Judgment : P.K. Misra, J The present writ petition has been filed by Union of India and two others challenging the order passed by the Central Administrative Tribunal (in short "Tribunal), whereunder the Tribunal has allowed the Original Application filed by the present Respondent No.2 and directed refund of Rs.2,40,800/- with interest at the rate of 9% to Respondent No.2. 2. The facts giving rise to filing of such O.A.No.30 of 2005 and thereafter the present writ petition are recounted in a nutshell. The present Respondent No.2, who was the applicant before the Tribunal, was appointed under Railways under Talent Scouting Scheme as he was an eminent Table Tennis player. He served Railways from 7. 2001 to 7. 2004. At the time of employment, a service bond has been executed stipulating a condition that he should serve the Railways for a period of three years. While the applicant was so serving, he was offered with better employment by Indian Oil Corporation (I.O.C.). At that time, when the applicant wanted to resign from the post and to be relieved, he was advised as per the Railway Board Letter R.B.E.No.120/85 dated 24. 1985 to remit the salary for a period of three years as per the conditions of the bond executed by him at the time of his initial appointment. Thereafter, the applicant paid the said amount of Rs.2,40,800/-and was relieved from the Railways enabling him to join I.O.C. In the Original Application, the applicant claimed that he was forced to sign the service bond stipulating a condition that he would serve the Railways for a period of five years. It is stated by him "At the time of appointment the applicant was made to sign the printed service bonds with several blanks on it. Without understanding the legal implications and the consequences, the applicant signed the service bond and later on the officials filled up the blanks by themselves". It has been further stated that since the latter job offered by I.O.C. was at stake ". . . the applicant was forced to remit the entire amount demanded on 25.03.2003", representing three years salary of the applicant. 3. The Department in its reply had stated that the applicant was selected in Sports quota and at the time of entering into service, a bond was executed, wherein it was indicated that the applicant was required to serve the Railways for five years. 3. The Department in its reply had stated that the applicant was selected in Sports quota and at the time of entering into service, a bond was executed, wherein it was indicated that the applicant was required to serve the Railways for five years. As the applicant had applied to I.O.C., without the knowledge and consent of the Railways and subsequently when the applicant wanted that he should be relieved, it has called upon to pay three years salary as compensation as per the bond. In normal course, he would have been required to pay equivalent to five years salary, but taking a lenient view he was called upon to remit salary for three years and after such amount was paid, he was relieved. 4. The Tribunal found that a bond had been executed wherein it was indicated that the applicant had undertaken to serve the Railways for five years. The Tribunal, however, found that in Clause 5 of the bond, the amount required to be paid had been left blank. The Tribunal, therefore, concluded that as the amount had not been quantified, it is not clear as to how the Department had arrived at a figure of Rs.2,40,800/-. The Tribunal by relying upon Section 74 of the Contract Act and the decision of the Supreme Court in AIR 1963 SC 1405 (Fateh Chand V. Balkishan Dass), held that in the absence of any legal injury suffered by the Railways, no amount was payable, particularly when the amount payable had not been stipulated in case of infringement or violation of the condition. Accordingly, the Tribunal directed that a sum of Rs.2,40,800/- shall be refunded to the applicant with 9% interest. The aforesaid order is in question in the present writ petition filed by the Department. 5. It is of course true that in the bond no amount has been specifically indicated as the amount payable in case of default or infringement of the bond. As observed by the Supreme Court in AIR 1963 SC 1405 (cited supra), in case of default, a reasonable compensation not exceeding the penalty stipulated is payable. In a subsequent decision reported in AIR 2003 SC 2629 (Oil And Natural Gas Corporation Ltd., V. Saw Pipes Ltd.,) it was observed :- "64. . . . As observed by the Supreme Court in AIR 1963 SC 1405 (cited supra), in case of default, a reasonable compensation not exceeding the penalty stipulated is payable. In a subsequent decision reported in AIR 2003 SC 2629 (Oil And Natural Gas Corporation Ltd., V. Saw Pipes Ltd.,) it was observed :- "64. . . . Finally, the Arbitral Tribunal held that as the appellant has failed to prove the loss suffered because of delay in supply of goods as set out in the contract between the parties, it is required to refund the amount deducted by way of liquidated damages from the specified amount payable to the respondent. 65. It is apparent from the aforesaid reasoning recorded by the Arbitral Tribunal that it failed to consider Sections 73 and 74 of the Indian Contract Act and the ratio laid down in Fateh Chand case wherein it is specifically held that jurisdiction of the court to award compensation in case of breach of contract is unqualified except as to the maximum stipulated; and compensation has to be reasonable. Under Section 73, when a contract has been broken, the party who suffers by such breach is entitled to receive compensation for any loss caused to him which the parties knew when they made the contract to be likely to result from the breach of it. This section is to be read with Section 74, which deals with penalty stipulated in the contract, inter alia (relevant for the present case) provides that when a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, the party complaining of breach is entitled, whether or not actual loss is proved to have been caused, thereby to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named. Section 74 emphasizes that in case of breach of contract, the party complaining of the breach is entitled to receive reasonable compensation whether or not actual loss is proved to have been caused by such breach. Therefore, the emphasis is on reasonable compensation. If the compensation named in the contract is by way of penalty, consideration would be different and the party is only entitled to reasonable compensation for the loss suffered. Therefore, the emphasis is on reasonable compensation. If the compensation named in the contract is by way of penalty, consideration would be different and the party is only entitled to reasonable compensation for the loss suffered. But if the compensation named in the contract for such breach is genuine pre-estimate of loss which the parties knew when they made the contract to be likely to result from the breach of it, there is no question of proving such loss or such party is not required to lead evidence to prove actual loss suffered by him. Burden is on the other party to lead evidence for proving that no loss is likely to occur by such breach. Take for illustration: if the parties have agreed to purchase cotton bales and the same were only to be kept as a stock-in-trade. Such bales are not delivered on the due date and thereafter the bales are delivered beyond the stipulated time, hence there is breach of the contract. The question which would arise for consideration is — whether by such breach the party has suffered any loss. If the price of cotton bales fluctuated during that time, loss or gain could easily be proved. But if cotton bales are to be purchased for manufacturing yarn, consideration would be different. . . . 69. From the aforesaid discussions, it can be held that: (1) Terms of the contract are required to be taken into consideration before arriving at the conclusion whether the party claiming damages is entitled to the same. (2) If the terms are clear and unambiguous stipulating the liquidated damages in case of the breach of the contract unless it is held that such estimate of damages/compensation is unreasonable or is by way of penalty, party who has committed the breach is required to pay such compensation and that is what is provided in Section 73 of the Contract Act. (3) Section 74 is to be read along with Section 73 and, therefore, in every case of breach of contract, the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree. The court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. The court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. (4) In some contracts, it would be impossible for the court to assess the compensation arising from breach and if the compensation contemplated is not by way of penalty or unreasonable, the court can award the same if it is genuine pre-estimate by the parties as the measure of reasonable compensation. 6. There is no specific material on record to indicate as to what would be the reasonable compensation. The fact remains that the applicant had entered into the bond. It cannot be assumed even for a moment that execution of the bond was outcome of any coercion or undue influence. The applicant had agreed to serve the Railways for a period of five years. Admittedly the applicant had to undergo a training of 1½ months and thereafter the Railways were expected to utilise the services of the applicant at least for a period of five years. Though the Tribunal is correct in coming to the conclusion that there was no basis for the Department to insist for return of the amount equivalent to three years salary, yet one cannot lose sight of the fact that the applicant himself had paid the amount. 7. In normal course, we would have remanded the matter to the Tribunal for consideration as to what would be reasonable compensation in the facts and circumstances of the case. However, since the matter has remained pending and the applicant has already joined services under another employee, instead of remanding the matter, we feel interest of justice would be served by directing the Railways to refund a sum of Rs.1,75,000/-. However, we do not find there is any justification for direction regarding payment of interest as it is the applicant who has paid the money to the Railways. 8. For the aforesaid reasons, the writ petition is allowed in part and the Tribunals direction is modified. The Railways is directed to refund a sum of Rs.1,75,000/- (Rupees one lakh and seventy five thousand only) to the applicant. This should be done within a period of sixty days from the date of receipt of the order, failing which such amount shall carry interest at the rate of 10% thereafter. There shall be no order as to costs.