Legal Defense using provisions of Indian Contract Act, 1872

This is in reference to the suit filed by UIC against our company for the damages to the contract's
breach and the LD amount that they are claiming for the same as per the provision mentioned in
section 73 of the Indian Contract Act,1872.

“Section 73:
Compensation for failure to discharge obligation resembling those created by contract: When an
obligation resembling those created by contract has been incurred and has not been discharged,
any person injured by the failure to discharge it is entitled to receive the same compensation
from the party in default, as if such person had contracted to discharge it and had broken his
contract.”

We signed the agreement with UIC on 01/01/2020, and the project is to be completed by
01/12/2020. We were willing to complete the contract but were unable to do so due to
Government Lockdown Orders which prevented carrying forward work on site. The Government
imposed the nationwide lockdown under section 6 of the Disaster Management Act, where
COVID-19 was declared a notified disaster.

"Section 6 of Disaster Management Act: Subject to the provisions of this Act, the National
Authority shall have the responsibility for laying down the policies, plans and guidelines for
disaster management for ensuring timely and effective response to the disaster."

The government order prohibited all the movements and activities, so carrying out the project's
activities was unlawful and impossible. Since it became impossible to carry out the project for
reasons beyond our control and we were willing to complete the contract as we deposited an
amount of five crores as security against non-performance of the project, UIC's petition files
need to be discarded. So, we would like to invoke the doctrine of force majeure of  section 56 of
the Indian Contract Act 1872 and would like to declare the contract as void.

"Section 56: Agreement to do impossible act: An agreement to do an act impossible in itself.

is void.
Contract to do act afterwards becoming impossible or unlawful: A contract to do an act.
which, after the contract is made, becomes impossible, or, by reason of some event which
the promisor could not prevent, unlawful, becomes void when the act becomes impossible or
unlawful."

Further, as the section 65 of the Indian Contract Act 1872, UIC is bound to return the forfeited
earnest money, as it is a clear violation of the provision.

"Section 65: When an agreement is discovered to be void, or when a contract becomes void, any
person who has received any advantage under such agreement or contract is bound to restore,
it, or to make compensation for it, to the person from whom he received it."
      
So, we request the honorable court to declare the contract void and direct UIC to return the
rupees five crores forfeited money.