The Court held that the Tribunal's decision was not patently illegal or in violation of public policy and that the Tribunal had not committed any error of law. The Court also rejected NTPC's challenge to the rejection of its counterclaims.

1. These two petitions under Section 34 of the Arbitration & Conciliation Act, 1996 (’Act’) by the National Thermal Power Corporation Limited (‘NTPC’) challenge the partial Award dated 31st July 2002 and the final Award dated 6th January 2009 passed by the International Court of Arbitration (‘Tribunal’) of the International Chamber of Commerce (ICC) by which NPTC has been directed to pay the Respondent Siemens Aktiengesellschaft (‘SAG’) a sum of Euro 17,158,557 on account of Claims C-2 to C-8, with Claim C-9 being rejected and further that NTPC should pay SAG a sum of Euro 7,604,296.38 by way of interest at 6% simple per annum on the aforementioned sum for the period from 20th August 2001 till the date of the Award i.e. 6th January 2009 and post Award interest at 6% simple per annum. PTC was also directed to bear the cost of arbitration i.e. USD 877,000 excluding USD 30,000 set aside for stamp duty and Euro 989,100 towards attorneys’ fees, expert fees and related expenses. According to NTPC, the total liability without calculating interest as on the date of the making of the Award i.e. 6th January 2009 was approximately Rs.174 crores.

Background Facts

2. NTPC awarded SAG on 30th September 1989 the project of Gas Based Combined Cycle Power Project of 817 MW at Dadri, Uttar Pradesh. The contract was entered into on 6th December 1989 and the General Terms and Conditions of the Contract (‘GCC’) formed part of the contract.

3. The project was to be constructed in two stages. In the first stage, four Gas Turbine Generators being Unit Nos.1, 2, 3 and 4 were to be constructed where power was generated by the use of natural gas and the waste gases escaping into the atmosphere. This was “the open cycle”. The second stage involved construction of two Combined Cycle Modules, being Modules-1 and 2 where Unit Nos.1 and 2 and Units 3 and 4 respectively of Open Cycle were combined. Waste gases from the open cycle were combined and utilized in the further generation of power.

4. There were specific time schedules for each of the stages of the entire project.

5. Disputes arose between the parties about the delay in the opening by NTPC of the Letters of Credit (‘LC’) which in turn led to delays during the execution of the first open cycle. Under Clause 20.2 of the Contract, the dates by which items of the first combined cycle had to be readied for shipment and with reference to such dates, the dates by which LCs were to be established by the NTPC were specified. For instance, the emergency DG generator was expected to be shipped on 1st February 1990 and the LC had to be established one month prior to that i.e. by 1st January 1990. The electrical items (Item Nos.83, 86, 88 and 90) had to be shipped by 1st May 1990. Correspondingly, the LC had to be opened on 1st April 1990. In fact, the LC for both these sets of equipments was established on 24th November 1990 and the dispatch could take place on 22nd December 1990. The gas turbine as well as generator for Unit No.1 was expected to be shipped on 1st June 1990. The LC for the gas turbine was established on 9th August 1990, with the delay of 100 days and was ultimately shipped on 30th August 1990. The LC for the generator was established on 24th November 1990, with a delay of 207 days and was ultimately shipped on 22nd December 1990.

6. There were corresponding delays in the subsequent stages of the project also. Ultimately the completion of the project was delayed by 55 months. The Gas Turbine 1 was commissioned with a delay of 13 months, the Gas Turbine 2 with a delay of 12 months, the combined cycle No.1 with a delay of 51 months. Gas Turbine 3 and Gas Turbine 4 were commissioned with a delay of 11 and 14 months respectively. Combined Cycle 2 completed successful trial operation only on 8th March 1997 with a delay of 55 months.

7. The actual date of opening of the LCs by NTPC is not in dispute. However, NTPC explained its difficulties as being attributable predominantly to the fol