Dear KK ji,
With due respect to you Sir, I disagree to your first sentence which says- “Legally speaking, in terms of Contract Act 1872, there is no difference between a MOU and contract”. However, I agree with Advocate Ravichandran who said that MOU may become a contract subject to contract act 1872.
To add, I will say MOU is just a mutual consent or understanding. It is just a proposal. It is not a concluded contract.
According to my understanding, MOU possesses legal value as evidence in the eyes of law. It has no legal enforceability as such. But it is a very useful tool. You may convert MOU as a part of contract.
Legality of MOU arises when any party fails to perform the understanding reached. Even in HR prospective, if you agree to dis-agree the understandings reached with Union, what will be the legal effect?
Thanks with regards.
Keshav Korgaonkar