A firm of film producers signed on a famous actress to play in a new film called Shangrila Again to be shot in the Himalayan region. They got the script written, hired players, arranged locations and made other arrangements. At the last minute, the leading lady repudiated the contract. As proper replacement could not be made, the project was abandoned. They calculated the loss to Rs$.3$ lakhs initial profit and had incurred Rs$.1,25,000$ as actual expenses of preparation. To what extent is the actress liable.