Background  Modern economic analysis of contract law began few decades ago and, many scholars would agree, has become the dominant academic style of contract theory. Though this amalgamation is very young still it has various important and useful aspects. Economic analysis of contract law assumes that contracts cannot be designed to describe every future state of the world. Economic Principles like Indifference curves; Pareto curves and Coase theorem1 are the most important aspect, which apply in relation to law of contract.2 The conventional analysis of contracts based on fairness holds that the purpose of damages is to compensate the victim of breach for his injury caused by the non-performance of the contract. In instances of perfect contract which includes the clauses stating the amount of damages payable to the aggrieved party, the work of the Courts are limited to the enforcement of the contractu ....