TMI Blog1993 (4) TMI 321X X X X Extracts X X X X X X X X Extracts X X X X ..... ny was authorised to develop the plot of land owned by the petitioner after demolishing existing structures thereon. The building when completed was to be shared equally between the petitioner and the respondent. The petitioner has referred to clauses 20 and 29 of the Agreement which inter alias provided for indemnity and payment of a stipulated sum in the event of the respondent's failure to complete the building within the time referred to in the agreement and that no amendment or modification to this agreement shall become operative or binding on the parties unless agreed to in writing between the parties respectively. Clause 29 was primarily made use of by the petitioner to rebut the arguments of the respondent that the petitioner h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on completion of the project this amount was to be refunded to the respondent. Apparently this provision was made only to enable the petitioner to hire alternate accommodation and meet the rental expenses out of the earnings he makes by investing the-said sum of ₹ 7 lacs. The expenses on the rental are stated at the bar to be ₹ 5,000.00 per month and the balance earning is being retained by the petitioner. In the present petition the petitioner has made a grievance that the respondent having failed to complete the project within the stipulated time has become liable to pay the compensation to the petitioner @ ₹ 50,000.00 per month. The relevant clause reads as under:- THAT in case completion of work under the agr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner would indemnify the builder for the losses suffered by the builder during such period. In essence this clause appears to be a contract for indemnity. The contract for indemnity has been defined under Section 124 of the Indian Contract Act as a contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself or by the conduct of any other person.... (8) My attention was drawn by the learned counsel for the petitioner to the effect mat this provision was more in the nature of a clause making provision for liquidated damages for the recovery of a specific amount. The law relating to damages in India has been provided in Section 74 of the Indian Contract Act which reads as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e arisen prior to not only the filing of this petition but earlier in time to the service of the notice under Section 434 also. Apart from that the Memorandum of Understanding clearly brings out that substantial part of the construction had already been undertaken and completed but nevertheless certain very important aspects had remained unattended and had not been taken care of, the value whereof had been ascertained to be Rs.l5 lacs. The respondent has further pointed out that the petitioner had turned dishonest and had got the premises sealed through his influence with the civic authorities. The respondents have further said that they are even now prepared to go ahead and complete the entire unfinished job within six months provided the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of short delivery was not in dispute and it was only the value thereof which was the question for determination. In that case there was no question of determining what is the adequate compensation as provided or envisaged under Section 74 of the Indian Contract Act. In any event I am unable to accept the contention that for an amount even though unascertained and undetermined, subject to a maximum of ₹ 3 lakhs, inspire of having an interest free deposit of ₹ 7 lakes, the petitioner is entitled to maintain a petition for winding up of the company simply because a notice of demand under Section 434 of the Companies Act was served on the company and on its failure to pay in response thereto. The requirement of law is not satisfied ..... X X X X Extracts X X X X X X X X Extracts X X X X
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