A stipulation in a bond for payment of compound interest on failure to pay simple interest at the same rate as was payable upon the principal is not a penalty within the meaning of which of the following provision of the Indian Contract Act, 1872?

Question

cdquestions Admin · Accepted Answer

According to Section 74 of the Indian Contract Act, a stipulation for payment of compound interest upon default in paying simple interest is not considered a penalty, provided the interest rate remains the same as the principal.

Answer

<div>Section 73</div>

Answer

<div>Section 74</div>

Answer

<div>Section 75</div>

Answer

<div>Section 76</div>

A stipulation in a bond for payment of compound interest on failure to pay simple interest at the same rate as was payable upon the principal is not a penalty within the meaning of which of the following provision of the Indian Contract Act, 1872?

The Correct Option is B

Solution and Explanation

Top Questions on Laws of Contract

Questions Asked in AIBE exam