IN THE HIGH COURT OF DELHI
Chandra Dhari Singh, J.
GMR Pochanpalli Expressways Limited - Appellant
Versus
National Highways Authority of India - Respondent
O.M.P.(I) (COMM.) 396 of 2020
Decided On : 10-01-2023
| Table of Content |
|---|
| 1. facts of the concession agreement and disputes. (Para 2 , 3 , 4 , 5) |
| 2. details on amount deductions and disputes arising. (Para 6 , 7 , 8) |
| 3. petitioner's arguments against the deductions made. (Para 9 , 10 , 11 , 12 , 13 , 14 , 15) |
| 4. respondent's counterarguments and objections. (Para 16 , 17 , 18 , 19 , 20) |
| 5. court's observations on interim measures under section 9. (Para 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35) |
| 6. conclusion on the maintainability of the petition. (Para 36) |
| 7. final dismissal of the petition. (Para 38 , 39) |
ORDER
Chandra Dhari Singh, J. (Oral)--The instant petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter "Arbitration Act") read with Section 2(1) of the Commercial Courts Act, 2015 has been filed on behalf of the petitioner seeking the following reliefs:
"i. Pass an order of mandatory injunction directing the Respondent to reimburse/release the amount of Rs. 12,56,72,430/- which has been deducted illegally and arbitrarily by the Respondent in breach of the Arbitral Award from the 22nd Annuity paid to the Petitioner under the Concession Agreement dated 31.03.2006 along with interest @5% over SBI PLR from the due date of payment till the actual date of payment;
ii. Pass any such other or further orders as may be deemed fit by this Hon'ble Court in the facts and circumstances of the present case."
FACTUAL MATRIX
2. The parties had entered into a Concession Agreement on 31st March 2006, for the design, construction, development, finance, operations and maintenance of K.M. 367.00 (Adloor Yellareddy) to K.M. 447.000 (Kalkallu) covering 85,745 km and improvement, operation and maintenance of K.M. 447.000 (Kalkallu) - 464.000 (Gundla-Pochanpalli) covering 17,000 km on NH-7 in the State of Andhra Pradesh (hereinafter "the Project").
3. The petitioner, being a Special Purpose Vehicle incorporated and registered under the Companies Act, 1956, by the consortium of GMR Infrastructure Ltd. and GMR Energy Limited, is involved in construction, operation and maintenance of the Project arising out of the Concession Agreement between the parties. The respondent is the National Highways Authority of India responsible for maintenance, management and development of National Highways or stretch of the National Highways vested in or entrusted to it by the Central Government.
4. As per the Concession Agreement, the petitioner achieved the Provisional Commercial Operation Date within 30 months, i.e., on 26th March 2009, whereafter, the petitioner has been operating and maintaining the Project. The final Completion Certificate was also obtained by the petitioner on 25th July 2009.
5. Thereafter, disputes arose between parties regarding requirement to do renewal work every five years. After several attempts of resolution of such disputes, with the intervention of this Court in OMP (I)(COMM) No. 421/2018, an Arbitral Tribunal was constituted by the Indian Council of Arbitration and ultimately, the Award dated 14th January 2020 was passed. The following reliefs were given in the said Award:
"a. The Petitioner is not entitled to the claim amount of Rs.104,47,80,462/- on account of reimbursement of costs incurred for relaying the pavement at the end at the end of the fifth year and extra costs incurred due to the decision not to allow recycling of milled material.
b. Petitioner is entitled to the claim amount of Rs.10,78,61,8641- on account of deductions made by the Respondent towards damages. The Respondent is required to pay the aforesaid amount to the Petitioner along with interest @ 12% p.a. from the date of deduction, i.e., 27.03.2018, till the date of payment.
c. Petitioner is entitled to the litigation costs of Rs.30 lacs, which is required to be paid by the Respondent to the Petitioner. In addition to this amount, whatever amount the Petitioner has deposited with the ICA towards the share of the fees payable by the Respondent, Rs.57,65,250/-,
A court cannot grant permanent relief under Section 9 of the Arbitration and Conciliation Act, as its provisions are limited to interim measures to support arbitration, not for final outcomes.
The relief sought under Section 9 of the Arbitration Act is interim in nature and cannot be a permanent measure.
The main legal point established in the judgment is the wide powers of the court under Section 9 of the Arbitration and Conciliation Act, 1996 to grant interim measures and protect the subject matter....
An Arbitral Tribunal under the Arbitration and Conciliation Act cannot grant interim orders that effectively render final decisions on substantive claims, as this exceeds its jurisdiction.
The limited grounds for interference with an arbitral award under Section 34 of the Arbitration and Conciliation Act, 1996, emphasize the concept of patent illegality and the criteria for setting asi....
An arbitrator must adhere to the contractual terms regarding interest, and if parties explicitly waive interest claims, such claim cannot be awarded under Section 34 of the Arbitration and Conciliati....
The award holder can seek interim relief under Section 9 of the Arbitration and Conciliation Act, 1996 until the complete satisfaction of the award.
Limited grounds for interference with an Arbitral Award under Section 34 of the Arbitration Act
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.