JUDGMENT

Chandra Dhari Singh, J. The instant petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter "the Act, 1996") has been filed on behalf of the petitioner seeking the following reliefs:

"Under the aforesaid facts and circumstances of the case and in the interest of justice, the applicant most respectfully prays as under:

a) that the arbitral award dated 12.06.2020 be set aside.

b) That the counter claim of the petitioner be allowed, namely:

(i) demand note of the petitioner dated 5.12.2017 of Rs.26,07,99,874/- (Rupees Twenty Six Crore even Lacs Ninety Nine Thousand Eight Hundred and Seventy Four Only) be upheld and respondent be directed to pay the same with compound interest of 12% per annum from 2008 onwards (start of the first demand note) till date. The overall demand with interest comes to about Rs.79.89 Crores (Rupees Seventy-Nine Crores and Eighty-Nine Lakhs Only).

(ii) the petitioner may be permitted to enforce the performance Bank Guarantee submitted by the respondent

(iii) petitioner my be allowed litigation costs

c) The claim of the respondent/claimant be dismissed

d) any other order/direction that this Hon'ble Court may deem fit may be passed."

FACTUAL MATRIX

2. The petitioner is Bharat Sanchar Nigam Limited (BSNL), a company incorporated under the Companies Act and, is engaged in the telecommunications business, a unified access service provider that has been granted a license under Section 4 of the Indian Telegraph Act 1885.

3. Petitioner floated an Expression of Interest dated 19th September 2007 calling for bids in respect of its enabling projects.

4. The respondent, Smart Division Private Limited (SDPL) submitted its bid in response to the Expression of Interest (EOI). Respondent's bid was selected pursuant to which Franchise Agreements (FA) dated 10th December 2007 were entered into between the parties.

5. Under the said FA, the respondent was to provide internet protocol/broadcast TV/radio, video, audio on demand, and interactive gaming services to the subscribers of the respondent in 53 cities in India on a non-exclusive and revenue-sharing basis. The project had to begin by first doing a trial run in Gurugram and then in the other 52 cities.

6. In accordance with Clause 4.7 of the FA, the respondent had also duly submitted to the petitioner, 53 performance bank guarantees, one in respect of each of the cities allocated to it. The respondent was the content aggregator for the provision of the Services, which were to be delivered on the petitioner's infrastructure. In terms of Schedule III, Clause 3.6.3 of the Franchise Agreement, inter-city bandwidth was to be provided by the petitioner to the respondent for the provision of the services at competitive rates by the petitioner. However, no pricing guidelines regarding the said competitive rates were set out.

7. Further, the petitioner had a right of first refusal for the provision of bandwidth to deliver the services, in the exercise of which right, it was providing the intercity bandwidth services to the respondent.

8. The respondent consistently faced infrastructure and network issues concerning the delivery of the Services which were repeatedly flagged to the petitioner.

9. The petitioner raised a provisional Demand Note dated 28th August 2008 for the cities of Ghaziabad, Faridabad, and Noida for intra-city band-with charges from Gurugram for an amount of Rs.1,12,36,000/-.

10. The respondent vide its letter dated 6th October 2008 asked the petitioner to fix the charges as per Telecom Regulatory Authority of India (TRAI) rates. After the mandate of TRAI, a 50% discount was provided to Internet Protocol Television (IPTV) franchisees like the respondent.

11. The petitioner raised revised provisional demand note(s) separately for intracity bandwidth charges for the city of Faridabad, Noida, and Ghaziabad, dated 24th November 2008 giving a 50% discount as envisaged in the tariff circular of the applicant/petitioner dated 14th