The court upheld the tribunal's award, concluding that the claims did not fall under 'excepted matters' and corroborated the contractor's entitlement to claims based on inadequate adjudication by the respondent.

JUDGMENT

Sanjeev Narula, J. (Oral)--The present petition filed by Union of India [hereinafter, "UoI"] under Section 34 of the Arbitration and Conciliation Act, 1996 [hereinafter, "the Act"] impugns the Award dated 11th October, 2019 passed by the Arbitral Tribunal adjudicating disputes arising out of work awarded on 7th February, 2016 to the Respondent-Chenab Construction Joint Venture [hereinafter, "CHENAB"] for `Design and construction of viaduct for single line B.G Railway Track between KM 32.690 and 33.853 in the Zone No. E-18 in Jammu-Udhampur Rail Link Project, including - soil investigation, detailed designs and construction of foundation, pier and abutments and super structure' [hereinafter, the "Project"].

2. The afore-noted work was initially allotted for a term of 24 months, however, due to various hinderances, nine separate extensions were granted to CHENAB and the work finally stood complete on 31st July, 2004 - after an additional period of 77 months.

3. After completion of the Project, CHENAB (Claimant therein) invoked arbitration for the first time vide letter dated 15th May, 2006 in respect of various disputes arising over non-payment of dues by UoI (Respondent therein), against work completed. UoI replied to the said letter on 10th November, 2006, denying referral to arbitration. This was rebutted by CHENAB vide letter dated 7th April, 2007, wherein referral to arbitration was sought.¹

4. Accordingly, the first Arbitral Tribunal was constituted, which passed an Award dated 25th September, 2009, holding UoI responsible for all delays and awarded certain claims in favour of CHENAB.² UoI's challenge to the said award was unsuccessful - both before the Single Judge³ as well as the Division Bench.⁴ After rejection of the appeal, payments were released to CHENAB, and thus, the first Award attained finality.

5. With respect to the claims rejected by UoI at the reference stage, CHENAB approached the High Court of Jammu & Kashmir under Section 11(6) of Arbitration and Conciliation Act, 1996, wherein a fresh Tribunal was directed to be constituted for the remaining/left-out issues vide Judgment dated 21st April, 2014.⁵ The Arbitral Tribunal was constituted vide letter dated 3rd June, 2015, and all remaining unadjudicated claims were referred to it. During the course of proceedings, on account of resignation of some members, the Arbitral Tribunal had to be reconstituted. Thereafter, the Tribunal vide Award on 11th October, 2019, partly allowed the claims in favour of CHENAB. Aggrieved with the same, UoI has filed the present petition.

6. The contentions of the parties and analysis of the Court on grounds of challenge urged by UoI are being decided on a claim-wise basis - with some of the claims being clubbed together, having regard to the commonality in the grounds of challenge urged.

CLAIMS NO. I, II, III & IV

7. The above-captioned claims raised by CHENAB are as follows:

(i) Claim No.1 for Rs.65,00,000/- on account of extra expenses incurred due to change in scope of work by adopting revised mix designs for construction of piers/abutment as compared to the tendered work/agreement.

(ii) Claim No.2 for Rs.95,00,000/- for extra expenses incurred in consuming additional quantity of reinforcement/structural steel as compared to the tendered one.

(iii) Claim No.3 for Rs.115.00 lacs on account of extra expenses incurred due to prolongation of contractual period.

(iv) Claim No.4 for Rs.58.00 Lacs on account of extra expenses due to casting of girder in one go, instead of stages.

CONTENTIONS OF UOI

8. Mr. Himanshu Upadhyay, counsel for UoI, challenges the Award in respect of the afore-note