Parties are entitled to interest on payments due under contracts; if no timeframe is specified, payments are due within 15 days of demand. The distinction between interest payments and debt repayment obligations is critical.

JUDGMENT

Sanjeev Narula, J. (Oral)--The present petition under Section 34 of the Arbitration and Conciliation Act, 1996 [hereinafter "the Act"] impugns the arbitral Award dated 14th August, 2021 passed by a three-member Arbitral Tribunal comprising of - Hon'ble Mr. Justice A.K. Patnaik (Retd.) (Presiding Arbitrator), Hon'ble Mr. Justice B. Sudershan Reddy (Retd.), and Mr. Raghav Chandra, IAS (Retd.) (Arbitrators) [hereinafter "impugned Award"].

BRIEF FACTS

The Contract

2. The Respondent/Vijaywada Tollways Pvt. Ltd. [hereinafter "VTPL"] being the L-1 bidder, was awarded the work of - "Six Laning of Chilkaluripet-Vijaywada Section of NH-5 from KM 355.000 to KM 434.15 (82.5 KM) in State of Andhra Pradesh to be executed as BOT (Toll) on DBFO Pattern under NHDP Phase-V" [hereinafter "Project"], vide letter of acceptance dated 21st February, 2008 issued by the Petitioner/National Highway Authority of India [hereinafter "NHAI"].

3. Parties entered into a Concession Agreement dated 04th June, 2008 [hereinafter "CA"]. The original Project length under the CA was 82.5 KM [hereinafter "Total Project Length"]. However, owing to various hinderances in a stretch of 14.5 KM (out of the Total Project Length), the Independent Engineer ["IE"] vide letter dated 18th December, 2009, directed VTPL to suspend the work qua the said stretch.

4. For afore-mentioned 14.5 KM stretch - parties entered into a Supplementary Agreement dated 09th September, 2013 [hereinafter "Supplementary Agreement"]. Therein, it was recorded that: (a) VTPL/Claimant proposed to exclude 14.5 KM stretch from the Project and the impediments arising thereunder. (b) In the event, NHAI was unable to fulfil its commitments qua the aforesaid stretch within three months or any further period as may be mutually agreed between the parties or any other further period w.e.f. signing of the Supplementary Agreement for handing over 14.5 KM stretch, the said stretch would be de-linked from the `scope of work'.

5. In the event of deletion of 14.5 KM of Chilakuripet Town stretch, it was further agreed that: (a) toll revenue for the stretch of 14.5 KM being collected by VTPL would be passed to NHAI from the date of collection of toll/appointed date i.e., 01st May, 2009; (b) maintenance expenditure on 14.5 KM stretch incurred so far and borne by VTPL would be reimbursed by NHAI (based on the recommendation of IE); (c) future maintenance expenses on the stretch of 14.5 KM would be borne by NHAI and maintenance could be done through VTPL or third-party (and payment thereon would be subject to certification by IE); and (d) VTPL would pay revenue sharing premium to NHAI as per Article 25 and 26 of CA for stretch of 68 KMs.

The Dispute

6. Disputes between the parties emanates from de-linking of 14.5 KM stretch from the Total Project Length. Since NHAI was not able to remove hinderances/impediments from the said stretch within three months from the date of the Supplementary Agreement, VTPL issued letters to NHAI to de-link the stretch of 14.5 KM from the `scope of work' and after nearly one and a half years from the date of the Supplementary Agreement (i.e., 09th September, 2012), conveyed the decision of the Executive Committee to de-link the aforesaid stretch from the `scope of work'.

7. Vide communication dated 01st November, 2018, NHAI sought recovery of Rs.16,76,66,383/- relying on the following clause of the Supplementary Agreement: (a) Clause B (iii) (i.e., toll revenue c