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2021 Supreme(Mad) 2192

IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
M/s. SB Adithya Power Projects Pvt Ltd, Rep. by its Director, Sheik Bareed – Appellant
Versus
M/s. Siemens Gamesa Renewable Pvt. Ltd, [Previously known as Gamesa Renewable Pvt.Ltd and before that known as Gamesa Wind Turbines Ltd], Rep. by its Managing Director, Chennai – Respondent
Original Petition No. 481 of 2020
Decided on : 28-09-2021

Advocate Appeared:
For the Appellant :M.S. Krishnan, SC, K. Gowtham Kumar, Advocates.
For the Respondent:R. Parthasarathy, Advocate.

Headnote:

Arbitration and Conciliation Act,1996 - Section 34 and 18 - Indian Contract Act, 1872 - Section 54 - Agreement - Failure in Completion of Work - Breach of Contract - It is case of respondent that agreement entered between parties is valid for two years from date of agreement or till completion of works under agreement, whichever is earlier - Claimant has to implement project in full by doing services mentioned in agreement itself - Time is essence of agreement and in event of delay, respondent is entitled to claim liquidated damages - Whether failure in completion of work is attributable to petitioner is also decided against petitioner without considering evidence of respondent – Held, This Court is of view that when arbitral tribunal has concluded that there is a breach of contract on part of petitioner, and ordered only refund of advance amount, other than statutory payment already made, it cannot be said that counter claim has been ordered without any default - What has been ordered is only advance amount paid, that too after deducting statutory payments made - Learned arbitral tribunal has also clearly given reasons for refunding advance - Reasoning and conclusion of tribunal is more plausible and merely because evidence of R.W.1 has not been considered, it cannot be said that ordering counter claim goes to root of matter and fall within ambit of perversity - What has been ordered is only admitted advance paid after deducting statutory deduction - Court is of view that arbitral tribunal has considered entire evidence and documents and entire award is a result of adequate reasoning and intelligible - Therefore, none of grounds has been made out to interfere with will reasoned award of tribunal and there is no merits in petition - Petition dismissed.

JUDGMENT :

(Prayer: Petitions filed under section 34 of the Arbitration and Conciliation Act,. 1996 to set aside the impugned Award dated 19.04.2019 passed by the Arbitral Tribunal in the arbitration between the petitioner and the respondent allowing the counter-claim filed by the respondent and to allow the claims filed by the petitioner before the Arbitral Tribunal and for costs of the proceedings.)

1. Aggrieved over the three member arbitral tribunal dismissing the claim of the petitioner and allowing of the part of the counter claim, the present petition has been filed.

2. Brief facts leading to filing of this original petition is as follows:

2.1 The claimant is in the field of wind energy and its function and business is to provide land, civil foundation, power evacuation facilities, erection of wind turbines and other related infrastructure development works necessary to establish wind farm projects. The respondent approached the claimant in setting up wind farms in the state of Maharashtra at wind power project in Khanapur and there were correspondences between the parties. Thereafter, Land Procurement and development agreement dated 22.04.2013 came to be executed between the parties. Simultaneously evacuation facility and development agreement dated 22.04.2013 is also executed between them. The scope of the work mentioned in the schedule-1 and payment schedule is mentioned in the schedule 4 of the agreement. Based on the agreement, the claimant without any delay proceeded for getting statutory clearance pertaining to the land such as village NOC, mining NOC, DIC to secure and block the land parcels etc. He has also applied for sixteen locations for basic infrastructure clearance with Maharastra Energy Development Authority and obtained the final clearance for one location. Statutory charges were paid for nine locations [Rs.20,10,000/-] for each obligation with necessary required details. The claimant has also identified the entire land parcel required for 200 MW project and blocked the lands by a way of agreement of sale, lease deed, sale deed, token sale advance, consent deed etc. The claimant also identified the lands of ROW for a distance of 40 kms from the wind farm to Khadegoan sub-station to evacuate the power as per the evacuation facility and development agreement dated 22.04.2013. After repeated reminders, the respondent paid a partial advance of Rs.9.69 crores by 14.06.2018 after a delay of two months as against Rs.36 crores payable under the agreements. The claimant also taken steps requesting MSETCL to extend grid connectivity. However, the respondent has not adhered to terms and conditions of the agreements by not issuing work orders in time and not releasing the funds as agreed exposing the claimant to difficulties to speed up the work.

2.2 The claimant by an email dated 01.10.2013, updated the progress and delay in issuing work orders. MSETCL made a provisional demand note dated 11.10.2013 for paying the provisional supervision testing charges of Rs.74.56 lakhs. The claimant sent an email dated 09.01.2014 highlighting the milestone achieved and how the respondent is delaying the project requesting release of pending work orders and payments. The respondent paid Rs.74.56 lakhs on 25.01.2014. The delay in payment caused delay in the execution of all related works since they are all interlinked. The respondent failed to release the amount as agreed. When the matter stood thus, even without considering the enormous work carried out by the claimant, the respondent mooted the option to tap from some of the existing 220 KV the feeder instead of Khadegoan substation. The respondent also insisted new conditions to obtain LILO [Loop in Loop out] permission from MEDA before taking the project. Consequent to new conditions insisted, the claimant was forced to do new work and eventually the entire activities as processed with the earlier agreements came to a standstill in order to meet new conditions imposed. Review meeti

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