A give B a bound for the repayment of Rs 1 000 with interest at 12 percent at the end of six months ...........

Indian Contract Act (ICA)1872 indemnity and guarantee

A give B a bound for the repayment of Rs 1,000 with interest at 12 percent at the end of six months, with a stipulation that, in case of default, interest shall be payable at the rate of 15 percent from the date of default.

B is entitled to recover from A, a reasonable compensation

B is not entitled to recover from A any compensation

B is entitled to recover from A, compensation and interest

Any of the above

छोटे Courses बड़े Results

Master indemnity and guarantee

Prepare through Micro-courses

Try Now

Explanation:

B is entitled to recover from A, a reasonable compensation

Explanation

The above question is similar to Illustration (d) to Section 74 of the Indian Contract Act. In the present case, It is a stipulation by way of penalty, and B is only entitled to recover from A such compensation as the Court considers reasonable.