The main legal point established in the judgment is that the Arbitral Tribunal's award must be in line with the Contract Agreement and applicable legal principles, as evidenced by the judgments cited.

ORDER :

Being aggrieved and dissatisfied with the award dated 27.07.2020 passed by the learned Arbitrator, the petitioner had filed the present Arbitration Original Petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred as “the Act”) to set aside the award.

2. The arbitration proceedings were initiated in respect of disputes arising between the petitioner and the respondent out of the Contract Agreement bearing Ref.No.23/BCM/08-09 dated 12.11.2008 (hereinafter referred as “agreement”) entered between them for the purpose of construction of a new complex for the Tamil Nadu Legislative Assembly at Omandurar Government Estate.

3. Though the petitioner had raised very many grounds, at the time of arguments, he had restricted his arguments with regard to the Claim No.A2 (Refund of Liquidated Damages) and Claim No.D (Consequential Damages due to stoppage of work) and also filed the written submissions only with regard to the aforesaid claims.

4. As far as Claim No.A2 is concerned, the learned counsel for the petitioner would submit that despite holding that the respondent is also responsible for the delay in execution of the project, the Arbitral Tribunal proceeded to award the claim for refund of liquidated damages, which is contrary to the clause 49 of the agreement dated 12.11.2008.

5. It was also submitted by the learned counsel for the petitioner that at paragraph No.62 of the award, the Arbitral Tribunal had rightly rejected the request made by the respondent for the extension of time on the ground of stoppage of work during assembly session and held that the respondent was permitted to work. Hence, awarding the claim of liquidation damages in favour of the respondent is inconsistent to its own findings and totally contrary to Clause Nos.28, 29, 32 and 49 of the agreement.

6. It was also contended by the learned counsel of the petitioner that the respondent sought for the extension of time for the reasons attributed by both Contractor and the Employer. The contractor had given a reason of lack of resources and the Employer had given a reason of restricted access during assembly sessions. Therefore, if there is any delay, attributable either to the contractor or the employer or to both, and the contractor seeks and obtains extension of time for execution on that account, he will not be entitled to claim compensation of any nature, on the ground of such delay, in addition to the extension of time obtained by him.

7. Further, by referring the letter dated 06.12.2010 vide L. No: DB/JDO2/F440-10/1315/2010, the learned counsel submitted that subsequent to the request for extension of time, the petitioner had sent the aforesaid letter (Ex.R.15) by which the time was extended by imposing a condition on the respondent that the petitioner would continue to levy the liquidated damages as per the terms of the agreement. Since the respondent had accepted to the terms of the aforesaid letter, they are estopped from challenging the liquidated damages. However, these aspects were not taken into consideration by the Arbitral Tribunal.

8. The learned counsel for the petitioner would submit that as held by the Hon'ble Apex Court in the case of Ramnath International Constrcution Pvt Ltd vs. Union of India and ors reported in AIR 2007 SC 509, when the extension of time was granted with a specific condition to continue the levy liquidated damages, the same cannot be disputed at a later stage and hence, the Arbitral Tribunal's award for Liquidated Damages is blatantly hit by the above judgment and therefore, the award is against the fundamental policy of Indian law.

9. The learned counsel would also contend that the Arbitral Tribunal had failed to taken into consideration of another judgment of the Hon'ble Apex Court in Construction and Design Services vs. Delhi Development Authority reported in 2015 14 SCC 263, wherein it has held that for public utility project even if there is no specific evidence of loss suffered by