IA No. 1001 of 2015 (for exemption)

1. Exemption allowed subject to all just exceptions.

2. The application is disposed of.

OMP No. 82 of 2015 & IA No. 1000 of 2015 (for stay)

3. This is a petition under Sections 14 and 15 of the Arbitration and Conciliation Act, 1996 (‘Act’) filed by the Petitioner, MBL Infrastructure Limited (‘MBL’), seeking termination of the mandate of the sole Arbitrator on the ground that he has become “de-facto and de-jure” unable to perform his function as an Arbitrator and to appoint any independent arbitrator in his place.

4. By an agreement dated 10th December 2007 entered into with the Madhya Pradesh Road Development Corporation Limited, the Petitioner was awarded a contract of rehabilitation and upgradation of road between Nagod – Amanganj with a contract value of Rs. 80,59,20,611. By an agreement dated 22nd February 2008 entered between the Petitioner, the Respondent, Telecommunication Consultants India Limited (‘TCIL’) and SMH Infrastructure Private Limited (‘SMH’), it was agreed that the Petitioner and TCIL had jointly executed the aforementioned road project and that TCIL would get the work executed through SMH.

5. Relevant to the present petition is the arbitration clause in the agreement which reads as under:

“13. Arbitration

13.1 All disputes and differences that may arise between the parties hereto in regard to or touching these presents, the carrying out of the terms and conditions hereunder and or the interpretation thereof in any way whatsoever so as to the construction, meaning, validity of effect of this agreement or any cause, matter or thing herein contained or the rights and liabilities of the parties hereunder shall be referred to arbitration and the said arbitration shall be governed by the Arbitration and Conciliation Act, 1996 or any statutory modification or reenactment in force for the time being. The Arbitrator shall be appointed by CMD, TCIL. The award of the Arbitrator shall give reasons for the Award and the same shall be final and binding on both the parties. Such arbitration shall be conducted at New Delhi. The laws of India shall govern this Agreement including the arbitration.

13.2 Only Delhi Courts shall have the exclusive jurisdiction on the subject matter of the agreement.”

6. In terms of the agreement, the estimated sub-contract value for SMH was Rs. 78,98,02,199. TCIL was to pay the mobilization advance of 10% of the contract value to the Petitioner and also a work advance, including advance at any point, which would not exceed a balance of Rs. 8 crores. In terms of the said agreement, TCIL released to the Petitioner mobilization advance of Rs. 7,88,39,238. According to the Petitioner, of the above mobilization advance, a sum of Rs. 5,44,98,654 was recovered against various RA Bills and further by cheque dated 26th December 2011 the Petitioner paid TCIL an amount of Rs. 2,43,90,547 being the balance mobilization advance together with interest. Therefore, according to the Petitioner, the entire mobilization advance along with interest stood paid by the Petitioner to TCIL.

7. The Petitioner claimed that the contract was successfully completed and a completion certificate was issued by the Petitioner by its letter dated 17th November 2011 to TCIL. The final bill was raised by SMH for a sum of Rs. 73,97,30,756.

8. As far as the work advance for a sum of Rs. 8 crores is concerned, the Petitioner claims to have submitted bank guarantees (‘BGs’) to the extent of Rs. 4.6 crores to TCIL from time to time. On 5th December 2012 the Petitioner paid to TCIL a sum of Rs. 5.10 crores and requested the TCIL for release of the BGs. The balance sum of Rs. 2.90 crores was to be paid before expiry of the BGs.

9. To restrain TCIL from encashing the said BGs, the Petitioner filed OMP No. 802 of 2013 in this Court. In its order dated 14th August 2013, the Court recorded the submissions of learned counsel for the Petitioner that the Petitioner would have no difficulty if the Respo