The main legal point established in the judgment is the interpretation of contract terms and the implications of accepting or declining contract extension conditions in the context of imposing penalties.

JUDGMENT

Sujoy Paul, J. - This appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996 (in short 'Arbitration Act') assails the order passed by learned Commercial Court in MJC AV No.249/2022 dated 03/02/2023, whereby the Court below has dismissed the application preferred by the appellant under Section 9 of the Arbitration Act,

Facts and contentions :

2. The admitted fact in this appeal are that the appellant pursuant to an offer dated 16/10/2018 submitted his candidature for grant of contract for construction of road over bridge including approaches in connection with up-direction single line flyover between Powarkheda - Jujharpur at NH-69. The Acceptance letter was issued to the appellant on 05/02/2019 initially for a period of 12 months. Indisputably, further 5th extension were granted upto order dated 01/04/2022. The last (6th) offer was given on 16/07/2022 (Annexure A/17). The appellant filed an application under Section 9 of the Arbitration Act on 21/07/2022 seeking stay of the order dated 16/07/2022.

3. In the said application, the appellant prayed for following relief :-

'(i) It is humbly and respectfully prayed to the Hon'ble Court may kindly be pleased to stay operation of order dated 16/07/2022 no. Pt.II/BPL/C/Cont/ROB/Up line flyover, issued by respondent No.2 imposing the penalty on the applicant firm till the arbitration proceedings which not initiated such order may be passed in the interest of justice.

(ii) It is humbly and respectfully prayed to the Hon'ble Court may kindly be pleased to restrain the respondent from initiated from any regularly on the basis of order imposing penalty dated issued by respondent No.2 from the running bill and applicant firm in the interest of justice.

(iii) Any other relief deems fit which may also be granted.'

(Reproduced as such)

4. Shri Atul Choudhari, learned counsel for the appellant submits that learned Commercial Court was kind enough in granting the interim protection to the appellant on 22/07/2022. However, when other party entered appearance and opposed the prayer, the matter was finally heard and decided by impugned order dated 03/02/2023 (Annexurre A/4).

5. Learned counsel for the appellant submits that the Court below in the impugned order has taken pains to reproduce the factual backdrop of the matter in sufficient details. The rival contentions of the parties were also reproduced in great details in the impugned order. However, while analyzing the prayer for interim relief, the basic findings were given in para-19 & 20 of the impugned order. By placing reliance on the judgment of Supreme Court in Welspun Specialty Solutions Limited vs. Oil and Natural Gas Corporation Limited, (2022) 2 SCC 382, the Court below opined that time was the essence of the contract and in this backdrop, the Court below opined that there will be no irreparable loss to the appellant because if appellant succeeds, the monitory loss by way of forfeiture of formal security of applicant may be compensated as per terms of contract by the concerned Arbitrator.

6. During the course of hearing, learned counsel for the parties fairly submitted that the extension of work offer was based on Clause 17(B) of Standard General Condition of Contract (GCC). The said Clause is pregnant with Annexure-VII (Proforma for time extension). During the course of hearing, it is agreed that the offer dated 16/07/2022 (Annexure A/17) is issued in consonance with Annexure - VII aforesaid, although the sentences/Clauses were rearranged in different sequence offer dated 16/07/2022 (Annexure A/17).

7. This document is relevant for the purpose of adjudication of the controversy, which reads as under :-

'No.Pt.II/BPL/C/Cont/ROB/Up line flyover/ Dated :16.07.202

M/s. Shree Manglam Buildeon (1) Pvt. Ltd.

SF-58 to 60, Hexzon Areade,

Nr. Jayaben Modi Hospital,

Opp. Shalimar Hotel, Valiya Road, GIDC

Ankleshwar - 393 002 Dist. Bharuch (Guj.).

Sub:Construction of Road Over Bridge including approaches at chainage 4590.55 of span (1x