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IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
National Highways Authority of India - Appellant
Versus
Punjab National Bank - Respondent
O.M.P. (COMM) 442 of 2020 & I.A. 6166 of 2020
Decided On : 04-01-2021
JUDGMENT
(Video-Conferencing)
1. The National Highways Authority of India (NHAI) seeks, by means of this petition, under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the 1996 Act"), to challenge the Award, dated 24th March, 2020, of the learned Arbitral Tribunal. The extent, to which NHAI is aggrieved by the impugned Award, would become apparent from the recital that follows.
Facts
2. NHAI invited bids, for construction, operation and maintenance of the Jetpur-Somnath section of NH-8D, spanning 127 km, in the state of Gujarat, on Design, Build, Finance, Operate and Transfer (DBFOT) basis. The bid of a consortium, comprising IDFC Projects Ltd and PLUS Expressways Berhad, of which IDFC Projects Ltd was the lead member, was accepted and a letter of award, dated 13th September, 2010, was issued in favour of the said consortium. The consortium, subsequently, incorporated a Special Purpose Vehicle, i.e. Jetpur Somnath Tollways Pvt. Ltd. (Respondent No 2 herein and referred to, hereinafter, as "JST"), for executing the contract.
3. A Concession Agreement, dated 7th February, 2011, followed, between JST and NHAI. Article 3.1 of the Concession Agreement granted the exclusive right, licence and authority to construct, operate and maintain the Project Highway, for 30 years from the Appointed Date, to JST. Subsequently, the Appointed Date was fixed, with consent of all parties, as 31st March, 2012, as recorded in the Minutes of the Meeting held, among the parties, on 27th March, 2012. Among the covenants of the Concession Agreement were the following:
(i) Article 14 dealt with the "Completion Certificate". Clause 14.2 stipulated that, upon completion of the construction works and on tests, carried out thereon, being successful, the Independent Engineer would issue, to the Concessionaire and NHAI, a Completion Certificate, in the form set forth in Schedule J to the Concession Agreement. Clause 14.3 provided for issuance of a Provisional Certificate and read, with its sub-Clauses, thus:
"14.3 Provisional Certificate
14.3.1 The Independent Engineer may, at the request of the Concessionaire, issue a provisional certificate of completion substantially in the form set forth in Scheduled-J (the "Provisional Certificate") if the Tests are successful and the Project Highway can be safely and reliably placed in commercial operation though certain works of things forming part thereof are outstanding and not yet complete. In such an event, the Provisional Certificate shall have appended thereto a list of outstanding items signed jointly by the Independent Engineer and the Concessionaire (the "Punch List"); provided that the Independent Engineer shall not withhold the Provisional Certificate for reason of any work remaining incomplete if the delay in completion thereof is attributable to the Authority.
14.3.2 The Parties hereto expressly agree that Provisional Certificate under this Clause 14.3 may, upon request of the Concessionaire to this effect, be issued for operating part of the Project Highway, if at least 75% (seventy-five percent) of the total length of the Project Highway has been completed. Upon the issue of such Provisional Certificate, the provisions of Article 15 shall apply to such completed part."
The Punch List items were required to be completed in terms of Clause 14.4, which read as under:
"14.4 Completion of Punch List items
14.4.1 All items in the Punch List shall be completed by the Concessionaire within 90 (ninety) days of the date of issue of the Provisional Certificate and for any delay thereafter, other than for reasons solely attributable to the Authority or due to Force Majeure, the Authority shall be entitled to recover Damages from the Concessionaire to be calculated and paid for each day of delay until all items are completed, at the lower of (a) 0.1% (zero point one percent) of the Performance Security and (b) 0.2%(zero point two percent) of the cost of completing such item
NHAI is contractually obliged to pay 90% of the Debt Due to lenders irrespective of defaults by the concessionaire, with no deductions permitted.
The main legal point established in the judgment is the limited scope of interference in an appeal under Section 37 of the Act, 1996 and the importance of interpreting and applying the provisions of ....
Point of Law - Limited scope of the jurisdiction of this Court vested in it by Section 34 of the 1996 Act, no occasion arises for this Court to revisit the said findings of the learned Arbitral Tribu....
Point of Law : Limited scope of the jurisdiction of this Court vested in it by Section 34 of the 1996 Act, no occasion arises for this Court to revisit the said findings of the learned Arbitral Tribu....
The court found that the contract in question is in the nature of a commercial contract and cannot be enforced specifically under the Specific Relief Act. The Tribunal held that NHAI's exercise of po....
The court determined that the petition for termination of the Concession Agreement by a non-party under Section 9 of the Arbitration Act was beyond its scope, as it sought final relief rather than in....
An expulsion under a contract must have legitimate causes, and unjustified actions by one party render such expulsion illegal, reaffirming constraints under arbitration frameworks.
In international commercial arbitration, challenges to awards are limited to specific legal grounds, and mere dissatisfaction with arbitral decisions does not constitute public policy violations.
The arbitral Tribunal found NHaI's actions to expel the respondent from the site was unjustified and illegal based on various grounds, including the delay in granting Extension of Time (EOT) and the ....
If the Concessionaire is able to recover any amount from NHAI, PNB would be well within its right to seek attachment of the said proceeds or take such steps for recovery of the amount from the Conces....
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