Munna Guest House Bar & Restaurant, Nani Daman.
Another joint where I spent plenty a pleasant hour, not rarely with the odd local calling for more snacks & not allowing you to pay for your bill, etc.
They told me it functions as a guesthouse too upstairs (logically so you might think, but as so often I never knew the place's name until I asked about it), not seen the rooms but I'd expect basic at that rate, in any case I was quoted (in Feb. 2009) Rs. 150 per person for a room with private bathroom here, so, well, that's certainly a bargain. Address: Jetty Road, PWD Office, Nani Daman, Daman 396210.
This is right by the Fort of St. Jerome's outer wall, if you walk up from town to the harbor there you can't really miss it, there's a number of (eating and drinking, not sure about sleeping) places here. Good and cosy family-type restaurant with a garden and an extensive cuisine nearby, too (and for those who prefer their stuff a little less hardcore perhaps ;) That family place is alcohol-free, I'm quite sure.) By night, stalls line up outside the Fort wall, it's all quite lively and attractive.