The court emphasized the importance of upholding the agreed terms and conditions of contracts, and rejected attempts to assert claims contrary to the agreed terms.

G.S. KULKARNI, J.

1. This appeal under section 37 of the Arbitration and Conciliation Act, 1996 (for short the 'Act') is directed against the order dated 8th June 2016 passed by the learned Single Judge whereby the appellant/claimant's petition under section 34 of the Act has been dismissed upholding the award passed by the learned sole Arbitrator.

2. The appellant was the beneficiary of a three year contract of “bulk advertising rights” awarded by the respondents namely General Manager, Western Railways, Churchgate, Mumbai for the Andheri, Jogeshwari and Goregaon Railway Stations in Mumbai. Disputes had arisen between the parties in relation to the said contract.

3. The appellant inter-alia had raised a claim for Rs.51,88,135/- along with interest against the respondents. The prayer clauses in the statement of claim, read thus:-

“The claimant therefore prays:-

(a) that this Hon'ble Tribunal be pleased to grant an award in terms of the Particulars of Claim annexed at Exhibit N hereto amounting to Rs.51,88,135/- (Rupees Fifty One Lakh Eighty Eight Thousand One hundred thirty five only) that this Hon'ble Tribunal be pleased to direct the respondent to pay interest and/or compensation and also loss of reputation by invoking bank guarantee on the amount to be awarded under the Statement of Claim from the date of Award till payment and/or realization at an exemplary rate to be fixed and/or decided by the Hon'ble Tribunal being not less than 18% per annum simple rate of interest;

(b) that this Hon'ble Tribunal be pleased to award costs of this Arbitration Reference and of all the proceedings precedent thereto by directing the respondent to pay the same to the claimant;

(c) this Hon'ble Tribunal may be pleased to pass further necessary orders as this Hon'ble Tribunal may deem fit and proper.”

4. The dispute underlying the above claim of the appellant was on the basis of an interim contract awarded by the respondents for the said advertisement work for a period of three months till finalization of the main contract under the tender issued by the respondents. In this regard the appellant by its letter dated 5 September 2006 offered to take up advertisement rights from the respondents-railways at the above stations on interim basis. This was at the same rate as for the main three year contract, namely at Rs.1,32,00,000/- which came to Rs.11,00,000/- per month as stated by the appellant in the said letter. In this letter, the appellant requested the respondents to provide 15 days gestation period from the date of the contract for business arrangement to be undertaken at these three stations. The appellant also stated that the interim award period be fixed till a final award letter in respect of the main tender is issued in favour of the appellant.

5. The respondents by their letter dated 13 September 2006 accepted the above offer of the appellant. It would be useful to refer to the contents of the said letter, as the controversy between the parties in the arbitration proceedings revolve around the “gestation period” as agreed between the parties. This letter of the respondents reads thus:-

“The competent authority has sanctioned the awarding of contract for Bulk Advertising Rights of Andheri station alongwith Goregaon and Jogeshwari as one whole cluster for an interim period on month to month basis till finalization of tender or maximum of 03 months at the same rate as bidded in the above referred tender and offered by you i.e. Rs.11,00,000/- per month.

The administration has agreed your request for granting 15 days as gestation period for putting up displays subject to condition that after finalization of tender, the contract period will start from the date of letter of acceptance and no gestation/grace period would be given.”

(Emphasis supplied)

6. It is clear from the above letter of acceptance that the respondents had agreed to the request of the appellant for granting 15 days as gestation period for installation of the advertisement su