The interpretation of the Concession Agreement, particularly Article 16 regarding Change of Scope and payment for the same, was central to the court's decision.

JUDGMENT :

1. National Highway Authority of India (hereafter ‘NHAI’) has filed the present petition impugning the arbitral award dated 27.11.2019 (hereafter ‘the impugned award’) rendered by the Arbitral Tribunal comprising of three members. The impugned award was rendered in respect of disputes that had arisen between NHAI and M/s BSCPL Godhra Tollways Limited (hereafter ‘the Concessionaire’) in respect of the Concession Agreement dated 25.02.2010 (hereafter ‘the Concession Agreement’).

2. M/s BSCPL Infrastructure Ltd., a company incorporated under the Companies Act, 1956 submitted a Request For Proposal (RFP) in respect of “Contract for Four Laning of Godhra to Gujarat/ Madhya Pradesh Border Section of NH-59 from Km 129.300 to Km. 215.900 in the State of Gujarat on Design, Build, Finance, Operate and Transfer (DBFOT) basis under NHDP – III”(hereafter ‘the Project’). By a letter of intent dated 01.01.2010 (LOA), NHAI accepted the proposal, quoting a premium of Rs.7.83 crores, submitted by BSCPL Infrastructure Ltd. It was further agreed that the concession period would be for twenty-seven years including the construction period of nine hundred and ten days from the ‘Appointed Date’. In terms of the RFP Document, BSCPL Infrastructure Ltd. was required to incorporate a Special Purpose Vehicle (SPV) for the purposes of the Project. Pursuant to the said LOA, BSCPL Infrastructure Ltd. incorporated the respondent company (the Concessionaire) as the SPV. The Concessionaire entered into the Concession Agreement on 25.02.2010.

3. The Appointed Date for commencement of the work was fixed at 01.03.2011 and the construction of the Project was agreed to be completed within a period of nine hundred and ten days, that is, on or before 26.08.2013. The execution of the contract was delayed and the time for completion of the Project was extended. NHAI accepted the first Provisional Commercial Operation Date (PCOD) for 78.271 kms on 31.10.2013 and the second PCOD for 7.196 kms on 25.09.2015. The Completion Certificate was issued on 29.06.2016 upon completion of the remaining works.

4. Disputes arose between the parties in connection with the construction of Road Over Bridges (ROBs). The Contract provided for the construction of five ROBs. However, with mutual agreement, the Concession Agreement was modified to include construction of only four ROBs. Admittedly, the specification of the ROBs as indicated in the Concession Agreement were changed. The Concessionaire claimed that the same resulted in a Change of Scope (hereafter ‘COS’)and in terms of the Concession Agreement, it was entitled to additional cost. According to the Concessionaire, the additional costs were to be determined on the basis of actual costs incurred in construction of the ROB’s, less costs as envisaged for construction of ROB’s as per the specifications stipulated in Concession Agreement. The said disputes could not be resolved amicably and were referred to arbitration.

5. NHAI does not dispute that there was a change in the specifications of the ROBs as originally envisaged. In terms of the Concession Agreement, NHAI was obliged to secure the approval of the Railway Authorities for the General Arrangement Drawing (GAD) and was required to provide the same to the Concessionaire. NHAI got GADs prepared for the ROBs, which provided for concrete structures, and submitted the same for approval to the Railways. However, after the contract for execution of the project was awarded to the Concessionaire and the parties had entered into the Concession Agreement, the Railways revised their Guidelines for Construction of Standard Arrangement Composite Girders. The same was also confirmed by the Railway Board Policy Circular issued on 28.06.2010. Thereafter, the same was also confirmed by NHAI in their Policy Circular No. 72/2011 dated 20.06.2011. The Concessionaire claimed that the above