( 1 ) THIS appeal has been preferred by Satluj Jal Vitran Nigam Ltd. (hereinafter referred to as sjvn ) impugning the order of the learned Single judge, wherein the learned Single Judge restrained the appellant from invoking the existing Bank Guarantee given by the respondent towards performance security and retention money for the purpose of recovery of outstanding ad hoc amount from the respondent at this stage. The learned Single Judge in the impugned order has further directed that the interest of the appellant could be safeguarded to the extent of the outstanding amount of the ad hoc payment by asking the respondent to furnish a new Bank Guarantee of the equivalent amount in favour of the appellant till the settlement of all the disputes between the parties in relation to the contract through the Departmental Review Board/adrb. This part of the impugned order of the learned Single Judge directing the respondent to furnish Bank Guarantee of the equivalent amount in favour of the appellant has been impugned by the respondent Jai Prakash Hyundai Consortium (hereinafter referred to as JHC) by filing another appeal being [fao (OS) no. 129/2005]. We propose to dispose of both the appeals by this common order as the facts and legal submissions made by counsel appearing for both the sides deal with the issues raised in both these appeals. JHC filed a petition under Section 9 of the Arbitration and Conciliation act, 1996 for grant of ad interim order restraining SJVN from encashing the bank Guarantee, i. e. Performance guarantees and guarantees in lieu of the retention money aggregating to a sum of Rs. 75 crores in order to effect recovery of its alleged claim of Rs. 53. 12 crores till the claims of JHC were finally settled in accordance with the modified Clause 67 of the General Conditions of the contract.

( 2 ) M/s JHC an Indian company incorporated under the laws of India engaged in the business of construction of river valley and Hydro-power projects on turnkey basis, entered into a contract in 1993 for execution of civil works for pressure shafts and power house complex. The said contract contained arbitration clause 67 for settlement of disputes and differences between the parties through Dispute Resolution Board (for short DRB ). In terms of Clause 10 of the General Condition of contract, M/s JHC was required to give performance guarantee as security for performance of its obligation in accordance with the contract. It was alleged that on account of delay owing to reasons attributable to sjvn, changes/variations from the original plans and execution of extra items of work, JHC filed the claim with the SJVN on account of claims of productivity losses, extension of time cost claims, claims for extra items, claims for revision of rates for works done beyond the period of completion, escalation claims, other miscellaneous claims amounting to more than Rs. 36 crores. It is the case of the JHC that after examining the claims in detail the SJVN agreed to release a sum of Rs. 5. 90 crores as ad hoc payment but asked for an undertaking that the amounts, if found to have been paid in excess, shall be recovered as and when the claims were settled. JHC gave an undertaking that the said amount could be recovered from the payment against these claims as and when these were settled. According to JHC, the total accumulated value of the claim of JHC exceeded Rs. 67. 36 crores till 25. 2. 1997 therefore, JHC requested the SJVN to release 75% of ad hoc payment pending final settlement. It is in this background SJVN released another sum of Rs. 12 crores on 31. 3. 1997 subject to similar undertaking as stated above. So the total became Rs. 17. 9 crores. The project was a World Bank funded project and in view of non-settlement of the dues of JHC by SJVN and delays in settling their final bill, on the advice and recommendation of the World Bank, SJVN hired the services of M/s Mc. Donough bolyard Peck, Virginia, USA, an internat