An arbitral tribunal's ruling on rates for substituted contract items and overhead compensations due to project delays is binding unless manifestly erroneous.

JUDGMENT

Vibhu Bakhru, J. The petitioner 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 20.11.2017 (hereinafter `the impugned award') delivered by the Arbitral Tribunal comprising of a learned Sole Arbitrator.

2. The impugned award was rendered in the context of disputes that have arisen between the parties in connection with a Contract Agreement bearing no 01/EE/CAG (hereinafter the `Agreement'). The petitioner is challenging the impugned award to the extent that the Arbitral Tribunal accepted Claim nos. 1.4, 1.5, 1.6 and 4 of the respondent.

3. The controversy in the present case arises in the following context:

4. On 06.08.2010, the petitioner invited tenders for the works regarding "C/0 ICED for CAG at Kant Kalwar area, Jaipur. (SH: Clo Academic Block, Hostel Block, Sports Block, Support Facility, Services Block &Residential Block, Air Tunnel i/c development work & internal Electrical Installation."(hereinafter the `Project'), on the terms and condition stipulated therein.

5. Pursuant to the said invitation for tenders, the respondent submitted its bid for an amount of Rs.44,35,87,494/- for executing the Project works. The respondent's bid was accepted on 05.05.2011 by the Executive Engineer, CAGPD. In terms of Clause 1 of the General Conditions of Contract (GCC) for CPWD Works, the respondent furnished a Performance Guarantee for an amount equivalent to Rs.2,21,79,375/-.

6. Thereafter, in the year 2011-12, the Agreement was executed between the parties. In terms of the Agreement, the stipulated date of commencement of the Project was 22.05.2011 and the stipulated date of completion of the Project was 21.03.2012. Admittedly, the works were completed on 21.11.2013.

7. It is averred in the petition that on 26.03.2015, the Final Bill for an amount of Rs.64,40,10,206/- and Rs.2,27,96,223/- for civil and electrical works respectively, was paid, and the payment was unconditionally accepted by the respondent.

8. Thereafter, by a letter dated 20.02.2016, the respondent submitted various points regarding the payments, which were due and payable to it and claimed an amount of Rs.16,36,09,815/- with interest at the rate of 18% per annum.

9. Thereafter, by a letter dated 04.04.2016, the petitioner rejected the claims preferred by the respondent as the same were outside the scope of the Agreement.

10. In view of the disputes between the parties, the respondent, by its letter dated 24.05.2016, invoked the agreement to refer the disputes to arbitration.

11. On 10.03.2016, in accordance with Clause 25 of the Agreement, the respondent referred the disputes regarding the payment of claims to the Superintending Engineer, JCC, CPWD, which were rejected by the Engineer on 07.04.2016.

12. Thereafter, on 24.05.2016, the respondent requested the Chief Engineer, NZ-III, CPWD to appoint an Arbitrator in terms of Clause 25 of the Agreement.

13. On 21.06.2016, the Chief Engineer, NZ-III, CPWD appointed Sh. G.C. Kabi as the Sole Arbitrator to adjudicate the disputes between the parties, however, on 13.01.2017, Sh. G.C. Kabi resigned from the said case. Thereafter, on 22.05.2017, the Chief Engineer, NZ-III, CPWD appointed Sh. Rajesh Banga as the Sole Arbitrator.

14. The tabular statement as set out in the impugned award, indicating the amounts awarded against the claims preferred by the respondent is reproduced below: