JUDGMENT :

Shekhar B. Saraf, J.:

1. In the present case, there is an application under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) filed by the Union of India through South Eastern Railways seeking an order for setting aside of the arbitral award dated May 10, 2021 read with corrections dated August 18, 2021 to the said arbitral award. The award debtor/petitioner has filed two interlocutory applications being GA/1/2021 under section 36 of the Act seeking an order for stay on the entire arbitral award whilst pending adjudication of its Section 34 application and GA/2/2023 seeking amendment of the pleadings and grounds in Section 34 application.

2. In the meanwhile, the respondent/ claimant Rashmi Metaliks Limited has filed an execution application being EC/99/2022 seeking enforcement of the said arbitral award.

3. Pursuant to 2015 amendment to the Act, there is no automatic stay on the enforceability of an arbitral award in the event of filing and pendency of an application for setting aside the arbitral award. Instead the award debtor is required to successfully file a separate application for obtaining a stay on execution of the arbitral award.

4. Therefore, in this judgment, I have only dealt with the Railways interlocutory application being GA/1/2021 in AP/482/2021 seeking a stay on the entire arbitral award. The remaining applications including the Section 34 petition and its amendment shall be considered at a later stage.

Facts

5. The relevant facts for the determination of the matter are as follows –

a. As per the Wagon Investment Scheme (hereinafter referred to as ‘WIS’) policy, 2005 initiated by the Indian Railways, independent investors were invited to invest in rakes or wagons and transfer it to the Railways to be merged by them in the common pool of wagons. In return, specified benefits such as freight concessions and rebates, guaranteed supply of a certain number of wagons per month, bonus rakes per month, etc., were to be extended by the Railways to those investors.

b. The initial WIS agreement dated May 30, 2007 was executed between the East Coast Railways (hereinafter referred to as ‘ECoR’) and the respondent Rashmi Metaliks Limited, wherein the respondent/claimant agreed to procure and handover five numbers of rakes as owners thereof to ECoR. The said five numbers of rakes [305 BOXN - HS wagons] along with five brake vans were to be merged and operated in the general pool of wagons of Indian Railways. As per the terms of the said agreement, the loading station for all the aforesaid rakes was at Nayagarh private siding and the unloading station for Rake 1 was at Sukinda Road, Rakes 2 & 3 were at Nirgundi and Rakes 4 & 5 were both at Sukinda Road and Nirgundi. Naturally, the loading and unloading stations were within the ECoR’s jurisdiction.

c. As per clauses 5 and 6 of the said agreement, the respondent/claimant was assured of certain benefits in lieu of its investment in the rakes. The ownership of the BOXN - HS wagons procured by the respondent/claimant was to get transferred to the Indian Railways after a period of 10 years from the date on which the rakes would be handed over to the ECoR.

d. It appears, from the facts in hand, that the respondent/claimant provided three of the contractually agreed five rakes to ECoR on August 05, 2008, August 06, 2008 and May 09, 2009. The construction of private siding at Nayagarh railway station under Khurda road division of ECoR by the claimant was delayed on account of factors completely beyond the control of the parties and the reasons contributing to such factors could be classified as force majeure events. Further, the claimant stated that the contractual clause in the said agreement obligating the claimant to set up its railway siding was rendered nugatory and unenforceable due to the aforesaid reasons that made performance of such covenant impossible. [As per the WIS policy, private siding obligations will be governed by resp