In Brief
MTNL sought to recover amounts deducted from bills owed to Tata Communications for alleged failure to provide last-mile connectivity under a 2008 purchase order. Tata claimed the deductions were unlawful and exceeded contractual limits. The Court held that where an express contract exists, quantum meruit claims under Section 70 of the Contract Act cannot be pursued as an independent remedy, as that provision applies only to quasi-contractual situations with no underlying contract. The Court affirmed that liquidated damages are capped at 12% as stipulated in the contract, and amounts exceeding this ceiling must be refunded. Unilateral bill adjustments outside the contractual mechanism are impermissible.
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