1977 (1) TMI 153 - SC - Indian Laws

Summary

Issues involved: Quantum of damages for breach of contract for manufacture of guns for the Nizam's Hyderabad Government in 1947.

The Supreme Court judgment addressed the appeal concerning the quantum of damages for a breach of contract for manufacturing guns for the Nizam's Hyderabad Government in 1947. The plaintiffs claimed damages for breach of contract, with the trial Court awarding a decree of Rs. 5,42,704-14-6, which was reduced to Rs. 4,73,847-6-1 by the High Court. The main discrepancy was in the rate of damages for breach of contract based on estimated profits, with the trial Court awarding Rs. 1,87,500-0-0. The High Court, without sufficient reasoning, reduced this amount to Rs. 1,25,000-0-0, which the Supreme Court found unjustified due to lack of tangible material or factual basis for the reduction. The Supreme Court set aside the High Court's judgment and reinstated the trial Court's award of Rs. 1,87,500 for estimated profits, noting that this amount had already been recovered by the appellants. The Court directed the parties to bear the costs and agreed that neither party would have to pay any amount to the other, inclusive of court fees, to simplify the resolution.

In the grounds of appeal, the State did not provide specific reasons challenging the 15% damages awarded by the trial Court, with only a general ground mentioned in the memorandum of appeal. Despite attempts by the State's counsel to highlight facts supporting a reduction in damages, the Supreme Court declined to delve into the matter further as no specific ground had been raised in the appeal to the High Court. The High Court, in reducing the damages to 10% of the contract price, lacked convincing reasoning or tangible material to support this adjustment. The Supreme Court emphasized the importance of factual basis for altering a trial Court's finding and, finding none, set aside the High Court's decision on damages for breach of contract, reinstating the trial Court's award of Rs. 1,87,500 for estimated profits.

The Supreme Court judgment ultimately upheld the trial Court's award of damages for breach of contract at Rs. 1,87,500, as the amount had already been recovered by the appellants. The Court directed the parties to bear the costs and agreed that neither party would have to pay any amount to the other, inclusive of court fees, to simplify the resolution process.