Srinagar, Aug. 20 -- The High Court of J&K and Ladakh on Tuesday held that forfeiture of the security deposit cannot be construed as penalty but legitimate and agreed contractual consequence of non-performance in a contract.

The observation was recorded in a case filed by one Syed Akhlaq Hussain against Vice Chancellor of Shri Mata Vaishno Devi University (SMVDU), Katra, and its other administrators for quashing contract for his G Active Security Service company for the university, besides forfeiting his security deposit in 2021.

The university had ordered cancellation of contract for the company on the basis of what it said had understaffed manpower.

Justice Wasim Sadiq Nargal while dismissing the petition by Hussain held "this court ...