The inapplicability of the ground of patent illegality to international commercial arbitration and the importance of interpreting specific contractual clauses in determining the validity of claims and counter-claims.

JUDGMENT

Vibhu Bakhru, J. - The National Highways Authority of India (hereinafter 'NHAI') has filed the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter 'the A&C Act') impugning an Arbitral Award dated 30.04.2019 (hereinafter 'the impugned award') delivered by the Arbitral Tribunal comprising of three members (hereinafter 'the Arbitral Tribunal') in respect of disputes that had arisen between the parties in relation with an agreement dated 20.02.2007 (hereinafter 'the Agreement').Factual Context

2. NHAI invited bids for the work of "four laning of Hyderabad-Bangalore section from KM 293.400 to KM 336.000 ofNH-7, in the State of Andhra Pradesh" (hereinafter the 'Project') from all eligible contractors.

3. The respondent (hereinafter 'CEC'), a company incorporated in Taiwan, submitted its bid on 18.09.2006, pursuant to the aforesaid invitation to bid. CEC's bid was accepted by a Letter of Acceptance (LoA) dated 22.11.2006, and the contract for executing the Project was awarded to CEC.

4. Thereafter, on 20.02.2007, the parties entered into the Agreement. The date of commencement of works was stipulated as 15.03.2007, and the works were to be completed within a period of thirty months, that is, by 14.09.2007. The Project was not completed within the stipulated period and the causes of delay are also a subject matter of dispute between the parties.

5. NHAI claims that it granted Extension of Time (EOT) to complete the Project up to 15.02.2011 due to delay attributable to CEC. However, it did not levy any liquidated damages on the delay.

6. Thereafter, disputes arose between the parties. CEC contends that certain amounts were due to it on account of the work executed but NHAI disputes the same.

7. The disputes were referred to the Dispute Adjudication Board (hereinafter the 'DAB') on 18.09.2017, however, the DAB failed to give its recommendation within the stipulated period of eighty-four days, that is, by 11.12.2017.

8. On 04.01.2018, CEC, issued a letter invoking the Arbitration Agreement - Clause 67.4 of the Conditions of Particular Application (COPA) - and sought reference of the disputes to arbitration.

9. Before the Arbitral Tribunal, CEC filed its Statement of Claims. The claims made by CEC are tabulated below:

10. NHAI filed its Statement of Defence, however, it did not raise any counter-claims.

11. By the impugned award, the Arbitral Tribunal awarded (i) an amount of Rs. 7,23,30,632/- against CEC's claim for a sum of Rs. 8,32,38,846/- in respect of the works relating to RE Retaining Wall (Claim No. 1); (ii) a sum of Rs. l,09,58,464/- against CEC's claim for a sum of Rs. 1,19,54,697/- in respect of payment for construction of water harvesting units (Claim No. 2); (iii) an amount of Rs. 1,34,01,819/- as aga