The main legal point established in the judgment is that an Arbitral Tribunal's findings of fact cannot be interfered with unless based on no material or are perverse.

VIBHU BAKHRU, J.

1. The petitioner (hereafter “AAI”) has filed the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter “the Act”) impugning the arbitral award dated 30.07.2015 (hereafter “the impugned award”) passed by the Arbitral Tribunal comprising of a sole arbitrator, namely, Sh Pradeep Kumar Gupta (hereafter “the Arbitral Tribunal”). The impugned award was rendered in the context of disputes that have arisen between the parties in relation to a contract for “Expansion of Apron, Construction of Additional Link Taxi Way, Helicopter Parking Bay and allied works at Bagdogra Airport”.

2. By the impugned award, the Arbitral Tribunal has awarded an aggregate sum of Rs.1,56,37,019/- to the respondent along with interest at the rate 12% per annum. The impugned award is premised on the Arbitral Tribunal’s conclusion that AAI has, inter alia, committed a fundamental breach of contract and the performance of the contract (completion of works awarded) had been inordinately delayed for reasons attributable to AAI. It is contended on behalf of AAI that the impugned award is perverse and contrary to law and, thus, is liable to be set aside.

Factual background

3. AAI is a body constituted by the Central Government under Airport Authority Act, 1995 for the purposes of construction and development of airports across India. AAI issued a Notice Inviting Tender (NIT) for the work of “Expansion of Apron, Construction of Additional Link Taxi Way, Helicopter Parking Bay and allied works at Bagdogra Airport” in West Bengal. Pursuant to the aforesaid NIT, the respondent submitted its tender and quoted an amount of Rs.18,53,20,401.33/-. The said tender was accepted and, on 20.09.2007, an acceptance letter was issued to the respondent.

4. Thereafter, on 04.10.2007, the parties entered into an agreement (hereafter “the Agreement”), whereby the respondent agreed to execute the works relating to expansion of Apron, Construction of Additional Link Taxi Way, Helicopter Parking Bay and allied works at Bagdogra Airport. The said work was to be commenced on 30.09.2007 and the stipulated date of completion of the said works was 29.09.2008. Admittedly, there was a delay of four months in handing over the site to the respondent.

5. On 04.01.2008, the petitioner sent a letter to the respondent enclosing revised drawing/plan/BOQ for the said works. The respondent replied to the said letter on 17.01.2008 complaining that the scope of work was drastically reduced by Rs. 5,66,41,106/-, which is approximately 31% of the contract sum. The respondent further stated that it would suffer huge losses on account of such significant reduction in the value of work. Thereafter, several letters were sent by the respondent citing the non-handing over of the complete site as the main reason for the delay caused in the completion of works. On 20.04.2009, AAI sent a letter informing about the deviation in the total cost of work and further stating that the total cost of the project work would now be approximately Rs.1300 lacs. Thereafter, the respondent sent several letters requesting for refund of excess bank guarantee, which was submitted based on the value of the work as initially awarded. However, AAI did not accede to the said request.

6. The respondent applied for extension of time (EOT) for completion of the works and AAI granted EOT till 19.09.2009.

7. Admittedly, there was a delay of three hundred and fifty five days in the completion of the aforesaid works: the said works were completed on 19.09.2009. In terms of the Agreement, there was a provision for the defect liability period of twelve months from the date of completion, that is, till 19.09.2010.

8. The final bill was paid on 16.09.2010. Thereafter, disputes arose between the parties for non-payment of the amounts raised by the parties in the final bill. Consequently, on 18.01.2012, the respondent invoked the arbitration clause and, accordingly, a sole arbitrator was appointe