Point of Law: Judicial interference in awards passed by Arbitral Tribunals should be minimal.

JUDGMENT:

Ujjal Bhuyan, J.

Heard learned counsel for the parties.

2. This appeal has been preferred by the Principal Secretary to the then Government of Andhra Pradesh in the Transport, Roads and Buildings Department and the then Andhra Pradesh Road Transport Development Corporation Limited (Corporation) under Section 37 of the Arbitration and Conciliation Act, 1996 (briefly, ‘the 1996 Act’ hereinafter), assailing the legality and validity of the order dated 18.11.2019 passed by the Commercial Court-cum-XXIV Additional Chief Judge, City Civil Court, Hyderabad, rejecting the petition filed by the appellants under Section 34 of the 1996 Act, being registered as C.O.P.No.12 of 2018.

3. Shorn of details, we may briefly narrate the facts leading to filing of the present appeal.

4. A work for construction of four high level bridges on Hyderabad-Guntur road was taken up by the Roads and Buildings Department of the then Government of Andhra Pradesh as a single package under the Build, Operate and Transfer (BOT) Scheme during the year 2002. The work was awarded to respondent No.1 i.e., Contec Syndicate Private Limited (briefly referred to hereinafter as ‘the contractor’), following which agreement dated 26.02.2003 was entered into between the parties.

5. According to the appellants, one of the salient features of the BOT contract was a concession period of 12½ years and out of which, the contractor was permitted to collect toll tax at Government approved rates for a period of 11 years.

6. It is stated that the contractor had completed construction of all the four bridges by 12.07.2004 and it collected toll tax at the Government approved rates for the period from 01.08.2004 to 31.07.2015.

7. There was a Terms of Reference for daily collection which was appended to the bid document. As per para 6 of the Terms of Reference, detailed procedure was laid down amongst others for revision of daily fee which could be altered with the prior approval of the Government.

8. Contractor made a representation to the Government under para 6.7 of the Terms of Reference for upward revision of the toll rates. The first representation was made on 18.11.2010, which was followed by the subsequent representation on 10.12.2010.

9. A steering group was constituted which made recommendation to the Government on 18.12.2013 calling upon the contractor to furnish revised proposal for prior approval of the Government.

10. When the contractor approached the Engineer-in-Chief, he made an endorsement on 23.12.2013 to the Managing Director of the Corporation to take up further necessary action. However, the Government, after gathering inputs, declined to grant prior approval to the contractor and rejected the request vide letter dated 27.06.2015.

11. Contractor invoked arbitration clause 19.2 (a) of the agreement dated 26.02.2003 on 03.07.2015 appointing a retired Judge of this court as its Arbitrator and requesting the appellants to appoint their Arbitrator as the second Arbitrator. When this was not done, the contractor filed an application under Section 11 of the 1996 Act before this court, which was registered as Arbitration Application No.95 of 2015. This court, by order dated 10.06.2016, constituted an Arbitral Tribunal under Section 11(6) of the 1996 Act for resolution of the dispute that arose between the parties in terms of the agreement dated 26.02.2003.

12. Following the aforesaid order of this court, appellants nominated a retired Judge of this court as their Arbitrator. The two Arbitrators i.e., one by the contractor and the other by the appellants viz., Justice R.Kantha Rao and Justice G.Bhavani Prasad, in turn, nominated Justice C.V.Ramulu as the third/Presiding Arbitrator of the Arbitral Tribunal.

13. Arbitral Tribunal commenced arbitral proceedings on and from 29.08.2016. While the contractor filed its claim statement, appellants filed written arguments. As per the claim statement, the contractor claimed compensation towards revised toll fee from 18.10.2010 to 31.07.