JUDGMENT : The plaintiff in a suit for realization of damages is the appellant in the second appeal. 2. The plaintiff is a public sector company. The first defendant was engaged by the plaintiff as a diploma trainee. As per the terms of the engagement, the first defendant had to be on training for a period of two years. He was entitled to only a consolidated stipend of Rs.600/- per month for the first year of training and Rs.750/- per month for the second year. The terms of the engagement also provided that on successful completion of the training, if the plaintiff desires to have the first defendant in their service, then the first defendant has to serve the plaintiff for a period of three years. The first defendant was also required to execute a bond along with a surety. The first defendant joined the services of the plaintiff on 1.2.1990 after executing the bond along with the second defendant, his father. As per the terms of the bond, the first defendant agreed, among others, that he will not leave the services of the plaintiff during the period of training and that he would refund the plaintiff the full amount of stipend received and pay 50% of the stipend receivable for the remaining period of training by way of damages, if he leaves the services of the plaintiff during the period of training. The case set out by the plaintiff in the plaint is that the first defendant left the services of the plaintiff while undergoing training, violating the terms of the bond, on 3.7.1991 and therefore, he is liable to pay to the plaintiff a sum of Rs.13,479.03 in terms of the bond. The suit was for realisation of the said amount with interest from the defendants. 3. The defendants resisted the suit contending, among others, that the secretary of the plaintiff, who instituted the suit on behalf of the plaintiff, was not competent to institute the suit on behalf of the plaintiff and that the suit is, therefore, not maintainable. It was also contended by the defendants that the bond relied on by the plaintiff is not one voluntarily executed by the defendants. It was further contended by the defendants that, at any rate, the plaintiff is not entitled to realize a sum of Rs.13,479.03 from the defendants. 4. It was also contended by the defendants that the bond relied on by the plaintiff is not one voluntarily executed by the defendants. It was further contended by the defendants that, at any rate, the plaintiff is not entitled to realize a sum of Rs.13,479.03 from the defendants. 4. The trial court rejected the contentions of the defendants and decreed the suit as prayed for. The defendants challenged the decision of the trial court in appeal. Though the appellate court found that Ext.A1 bond is one voluntarily executed by the defendants and the defendants are liable to the plaintiff for the amount claimed in the suit, it reversed the decision of the trial court and dismissed the suit holding that the secretary of the plaintiff who instituted the suit on behalf of the plaintiff was incompetent to institute the suit on behalf of the plaintiff. The plaintiff is aggrieved by the decision of the appellate court. 5. Heard the learned counsel for the appellant as also the learned counsel for the respondents. 6. The learned counsel for the appellant, placing reliance on Order 29 of Rule 1 of the Code of Civil Procedure ('the Code') and Rule 29 of the Civil Rules of Practice, contended that in terms of Order 29 of Rule 1 of the Code, the plaints in suits instituted by corporations can be signed and verified on behalf of the corporations by its Secretaries and in terms of Rule 29 of the Civil Rules of Practice, once such signed and verified pleadings are presented before the ministerial officer of the Court either the Secretary himself or his pleader or the registered clerk of the pleader, the institution of the suit is complete. According to the learned counsel, a suit instituted in the aforesaid manner cannot be dismissed as not maintainable. It was pointed out by the learned counsel that the appellate court found that the secretary of the plaintiff was not competent to institute a suit on behalf of the plaintiff, placing reliance on Article 129 (b)(7) of the Articles of Association of the plaintiff empowering its Managing Director and other Directors to institute suits on its behalf. It was pointed out by the learned counsel that the appellate court found that the secretary of the plaintiff was not competent to institute a suit on behalf of the plaintiff, placing reliance on Article 129 (b)(7) of the Articles of Association of the plaintiff empowering its Managing Director and other Directors to institute suits on its behalf. According to the learned counsel, Article 135 of the Articles of Association of the plaintiff empowers the secretary of the plaintiff to institute suits and other proceedings on behalf of the plaintiff and it is without adverting to the provision contained in Article 135 that the appellate court non-suited the plaintiff on the ground. 7. Per contra, the learned counsel for the respondents contended that Article 129(b)(7) of the Articles of Association of the company confers authority to institute suits on behalf of the plaintiff only to the Managing Director and the Directors of the plaintiff and Article 135 of Articles of Association does not confer such a power on the secretary of the company. It was also contended by the learned counsel that the finding rendered by the appellate court that the plaintiff was otherwise entitled to the decree prayed for, is unsustainable. The learned counsel elaborated the said contention pointing out that merely for the reason that defendants have executed a bond, the plaintiff is not entitled to the amount mentioned therein by way of compensation for the breach, if any, committed by the defendants. It was argued by the learned counsel that whatever be the stipulation contained in the bond or contract, a party complaining of breach of contract would be entitled to compensation only if it is shown that he/she has sustained loss on account of the breach committed and the stipulation in the contract as to the compensation payable for the breach is a reasonable one. According to the learned counsel, there is no pleading or proof in the plaint as to the loss caused to the plaintiff on account of the breach of the terms of the contract committed by the first defendant and also the various heads and provisions under which they are entitled to the compensation, in order to enable the court to consider whether the compensation claimed is a reasonable one. It was contended by the learned counsel that the finding rendered by the courts below that the plaintiff is entitled to a sum of Rs.13479.03 by way of compensation from the defendants is therefore, unsustainable and perverse. It was pointed out by the learned counsel that in the light of Order 41 Rule 22 of the Code, the defendants are entitled to raise such contentions in the appeal preferred by the plaintiff. 8. Article 129(b)(7) of the Articles of Association reads thus: Powers of company vested in directors: 129 (a) xxxx xxxx 129 (b) : Without prejudice to the generality of the powers conferred by the last preceding clause, and the other powers conferred by these presents, it is hereby expressly declared that the Directors shall have the following powers, that is to say, Powers: (1) xxxx xxxx xxxx (2) xxxx xxxx xxxx (3) xxxx xxxx xxxx (4) xxxx xxxx xxxx (5) xxxx xxxx xxxx (6) xxxx xxxx xxxx (7) To institute, conduct, defend compound or abandon any actions, suits, and legal proceedings by or against the company or its officers or otherwise concerning the affairs of the company and also to compound or compromise or submit to arbitration the same actions, suits and legal proceedings. Article 135 of the Articles of Association reads thus: Any Managing Director or the Secretary for the time being or any other person duly authorized by the Directors shall be entitled to make, give, sign and execute all and every warrant to sue or defend on behalf of the Company, all and every legal proceedings and compositions or compromise, agreement, and submission to arbitration and agreement to refer to arbitration as may be requisite, and for the purpose aforesaid, the Secretary, or such other person may be empowered to use their or his own name on behalf of the Company and they or he shall be saved harmless and indemnified out of the funds and property of the Company, from and against all costs and damages which they or he may incur or be liable to by reason of their or his name being so used as aforesaid. A conjoint reading of the aforesaid provisions in the Articles of Association of the plaintiff would indicate that the direction to institute a suit on behalf the plaintiff has to come from the directors of the plaintiff, and the secretary or any other person duly authorized by the directors is entitled only to sign and verify pleadings in such suits as provided for under Order 29 of Rule 1 of the Code. In other words, the secretary of the plaintiff cannot take a decision to institute a suit on behalf of the company. 9. In the circumstances, the following are the substantial questions of law arising for consideration in the second appeal: (i) Was the appellate court justified in non-suiting the plaintiff merely for the reason that the suit is instituted by the secretary of the plaintiff? (ii) Are the findings rendered by the courts below that the plaintiff is entitled to realize a sum of Rs. 13,479.03 by way of compensation from the defendants, perverse in law ? 10. Question (i) : Institution of a suit is a procedural matter and it is fundamental that procedural defects shall not defeat the cause of justice. The question, according to me, shall be addressed having regard to the said principle. There cannot be any dispute to the fact that the plaintiff would fall within the scope of the expression 'corporation' as contained in Order 29 Rule 1 of the Code. Order 29 Rule 1 of the Code reads thus: Subscription and verification of pleading.- In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. In the light of the extracted provision, the authority of the secretary of a corporation to sign and verify the plaint in a suit to be instituted on behalf of the corporation cannot be doubted. In the light of the extracted provision, the authority of the secretary of a corporation to sign and verify the plaint in a suit to be instituted on behalf of the corporation cannot be doubted. Rule 29 of the Civil Rules of Practice reads thus: Presentation of Proceedings and Documents.- (1) All plaints, written statement, memoranda of appeal, applications and other documents may be presented to or filed in Court by delivery of the same personally by the party, his pleader or pleader's registered clerk to the Chief Ministerial Officer of the Court or any officer specially authorized in that behalf, at any time before 3 p.m. or if the presiding officer so directs even after 3 p.m. during office hours. The said officer shall at once initial the paper endorsing thereon the date of presentation, and, if a proceeding is thereby instituted, noting thereon its serial number. As rightly pointed out by the learned counsel for the plaintiff, a combined reading of the aforesaid provisions would indicate that a plaint properly signed, verified and presented before the Ministerial Officer of the court either by the secretary himself or his pleader or the registered clerk of his pleader would amount to institution of the suit. The question is as to whether such a suit could be dismissed on the ground that the secretary is not empowered in terms of the Articles of Association of the company to institute the suit on behalf of the company. My answer is in the negative. The reason is that even while accepting the fact that it is for the directors of the company to take a decision as to whether a suit is to be instituted on behalf of the company in terms of the provisions contained in the Articles of Association, so long as the secretary is empowered to sign and verify the pleadings in the plaint, the institution of the suit by the secretary cannot be said to be illegal, for such institution is presumed to have been made under the authority of the directors of the company. The said authority can be either express or implied. The same need not necessarily be obtained before the institution of the suit. The conduct of the secretary in instituting a suit can be ratified also at a later point of time. Those are all internal matters of the company. The said authority can be either express or implied. The same need not necessarily be obtained before the institution of the suit. The conduct of the secretary in instituting a suit can be ratified also at a later point of time. Those are all internal matters of the company. Of course, in cases where the defendants contend that the suit is instituted without express or implied authority of the company, it would be obligatory for the secretary to establish that the suit has been instituted with authority [See United Bank of India v Naresh Kumar and Ors. (1996) 6 SCC 660 ]. 11. Coming to the case on hand, the defendants have no case in the written statement that the secretary of the company has instituted the suit without the authority of the company or its directors. Instead, their contention is only that the secretary is not empowered to institute the suit on behalf of the plaintiff. Paragraph 3 of the written statement reads thus: xxx xxx xxx In the absence of a specific plea that the secretary of the plaintiff has instituted the suit without the authority of the plaintiff or its directors, according to me, the appellate court has acted illegally in non suiting the plaintiff. The question is thus answered accordingly. 12. Question (ii) : Under Section 73 of the Indian Contract Act, when a contract is broken, what is recoverable is only the loss or damage caused, which naturally arose in the usual course of things from the breach or which the parties knew, when they meet the contract, to be likely to result from breach of it. Section 74 of the Contract Act which supplements Section 73 of the Contract Act clarifies that irrespective of the amount stipulated in the contract as the amount to be paid in the case of breach, the party complaining of the breach is entitled to claim only reasonable compensation and the amount stipulated could be taken only as the outer limit. Section 74 of the Contract Act also clarifies that reasonable compensation can be claimed in such cases irrespective of the question whether or not actual loss is proved to have been caused. If the extent of loss or damages is capable of being proved, such evidence provides a safe guide for the court to determine the quantum of reasonable compensation. Section 74 of the Contract Act also clarifies that reasonable compensation can be claimed in such cases irrespective of the question whether or not actual loss is proved to have been caused. If the extent of loss or damages is capable of being proved, such evidence provides a safe guide for the court to determine the quantum of reasonable compensation. If quantification of the loss or damage is not possible, still the party who suffered the loss can request the court to assess reasonable damages. Undoubtedly, the plaintiff has the duty to prove the damages actually suffered by it. In discharging that burden, the estimated stipulation as to the damages in the contract itself could be taken as evidence, even though it is not conclusive evidence. If the evidence shows that the stipulated amount is fair or that actual damages may go even above that figure, the court can certainly grant the stipulated amount by way of damages. When the stipulation is unreasonable, independent proof may be necessary. In short, what the court has to see in a case where liquidated damages is provided for the breach of the terms of the contract is whether the damages provided for in the contract is a reasonable one having regard to the facts of the case including the agreement, irrespective of the question as to whether actual damage is proved to have been caused [See Fateh Chand v Balkishan Dass ( AIR 1963 SC 1405 ), State of Kerala v United Shippers and Dredgers ( 1982 KLT 738 ) and The Fertiliser and Chemicals, Travancore Limited v. Ajayakumar and others [1991 LAB.I.C. 485]. 13. Coming to the case on hand, the contention taken by the defendants that Ext.A1 bond is not one voluntarily executed, has been rejected by the courts below. Though there is no specific pleading in the plaint as to how the amount of Rs.13479.03 claimed in the suit has been arrived at, the evidence tendered by PW1 indicates that what is claimed in the plaint is the amount payable by the defendants in terms of Ext.A1 bond. The amount payable in terms of Ext.A1 bond by a trainee who leaves the company before completing the training is the amount received by him way of stipend and 50% of the stipend receivable by him for the remaining period of training. The amount payable in terms of Ext.A1 bond by a trainee who leaves the company before completing the training is the amount received by him way of stipend and 50% of the stipend receivable by him for the remaining period of training. As noted, the first defendant joined the service of the plaintiff as a trainee on 1.2.1990 and he left the company after 17 months. The first defendant has no case that he has not received the stipend for the said period. The stipend at the rate of Rs.600/- per month for the first year and Rs.750/- per month for the second year would therefore, come to Rs.10950/-. It is seen that the balance amount claimed in the suit is less than 50% of the stipend payable to the first defendant for the remaining period of training. In so far as the first defendant has not completed the training and joined duty as a regular employee in the service of the plaintiff, it cannot be said that the stipend paid to him by the plaintiff during the period of training would not be a loss for the plaintiff. it is beyond doubt that other than the stipend, various expenses must have been incurred by the plaintiff for extending training to persons engaged like the first defendant such as remuneration/salary to the training staff, expenses for the infrastructure arrangements to be made for the training etc. It is very difficult to arrive at the exact amount incurred by the plaintiff for the purpose of extending training to a particular employee, when employees are being trained batch by batch. Provisions for liquidated damages are made to take care of situations of this nature. As indicated above, what is to be seen by the court in a case of this nature is whether the stipulation in the contract is a reasonable pre-estimate of the the loss. If the court finds that the stipulation in the contract is a reasonable preS. estimate of the loss, according to me, the court shall grant decree in terms of the agreement. If the court finds that the stipulation in the contract is a reasonable preS. estimate of the loss, according to me, the court shall grant decree in terms of the agreement. On the facts of the present case, it cannot be said that the stipulation in the agreement that the trainee who leaves the company before completing the training shall refund the stipend received and shall pay 50% of the stipend payable to him for the remaining period of training by way of damages for the loss caused to the plaintiff is not a reasonable pre-estimate of the loss. Question (ii) is also, therefore, answered in favour of the plaintiff. In the result, the impugned decree and judgment of the appellate court is set aside and the decree and judgment of the trial court is restored.