Case of J&K Economic Reconstruction Agency vs Simples Projects Limited, HC Delhi Judgement dated 19thMay 2025. High Court held that the Liquidated Damages clause does not entitle a party to claim the whole Liquidated Damages sum automatically upon the occurrence of breach. Liquidated Damages can be claimed subject to proving the actual loss suffered. The court observed that it may be noted that as per law of damages evolved by courts in India, unlike UK, the Indian law does not recognise penalties as a measure of damages. The courts have therefore held that LD stipulated in contracts must not be in the nature of penalty but must be in the nature of a genuine pre- estimate of damages made by the parties.