JUDGMENT

VIBHU BAKHRU, J

1. M/s IJM-Gayatri (JV) (hereinafter ‘IJM’) has filed the present appeal under Section 37(1)(c) of the Arbitration and Conciliation Act (hereinafter ‘the A&C Act’) impugning a judgement dated 12.05.2020 (hereinafter ‘the impugned judgement’) passed by the learned Single Judge, whereby National Highway Authority of India’s (hereinafter ‘NHAI’) application under Section 34 of the A&C Act, seeking to set aside an arbitral award dated 09.08.2017 (hereinafter ‘the impugned award’), was partially allowed.

Factual Context

2. NHAI issued a Notice Inviting Tender (NIT) for execution of the work relating to “widening of 4/6 lanes and upgrading of existing 2 lane Road of NH-5 in the State of Andhra Pradesh from Km. 291.000 to Km. 358.000 of Ongole-Chilakaluripet-Contract Package AP-13” (hereinafter ‘the Project’), on the terms and conditions stipulated thereon. Pursuant to the said NIT, IJM submitted its bid for executing the Project works. IJM’s bid was accepted by NHAI and by a Letter of Acceptance dated 20.04.2001 (hereinafter ‘the LoA’), the contract for implementation of the Project was awarded to IJM for a consideration of ₹225,39,46,841/-.

3. Subsequently, on 25.05.2001, the parties entered into a formal agreement [being Agreement no. 0040 /NH- 5/GQ/GM (E-l) /2001] (hereinafter ‘the Agreement’). In terms of the Agreement, the works were to be completed within a period of thirty-one months from the commencement date and the defect liability period was stipulated as twelve months.

4. Thereafter, on 29.05.2001, NHAI issued a notice to proceed with the work, in accordance with Clause 41.1 of the Special Conditions of Contract (hereinafter ‘the SCC’). In terms of the said notice, the scheduled date of commencement of work was stipulated as 01.06.2001 and the scheduled date of completion was stipulated as 31.12.2003.

5. The Agreement provided for sectional completion of the Project and was divided into three sections, that are, Section A: Km 292.000 to Km 300.000, Section B: Km 300.000 to Km 330.000 and Section C: Km 330.000 to Km 357.979.000 and Km 291.000 to Km 292.000. Admittedly, there were certain delays in execution of the Project works and IJM sought Extension of Time for completion of the works on successive occasions, which were approved by NHAI.

6. IJM claimed that it had immediately commenced the works and duly mobilised its resources, however, the sites/stretches were not handed over properly and/or free of encumbrances and thus, there were delays and interruptions in execution of the works on the part of NHAI. NHAI had disputed the same and according to it, the delays were on the part of IJM. The date of completion for each section was extended up to 24.03.2006, 31.12.2005 and 24.03.2006 respectively.

7. Thereafter, on 28.08.2007, IJM submitted the ‘Statement at Completion’, in accordance with Clause 60.10 of the Conditions of Particular Application (hereinafter ‘COPA’) to the Acting Resident Engineer. The Acting Resident Engineer certified certain payments, however, excluded some claims submitted by IJM with the ‘Statement at Completion’.

8. Thereafter, on 21.10.2008, NHAI issued a Defect Liability Period Certificate (hereafter ‘DLC’). Pursuant to the issuance of the DLC, on 27.02.2009, IJM submitted a Draft Final Statement (hereafter ‘DFS’), in accordance with Clause 60.11 of the COPA and asserted the claims submitted by it along with the ‘Statement at Completion’. The DFS was divided into two parts: Appendix A, which contained the final value of work done in terms of Clause 60.11(a) of the COPA; and Appendix B, which contained such further sums that IJM considered to be due to it under the Agreement in terms of Clause 60.11(b) of the COPA.

9. Thereafter, by a communication dated 02.03.2009, the Engineer effected certain recoveries from the DFS submitted by IJM. By a communication dated 03.03.2009, IJM conveyed its disagreement in respect of the recoveries effected by the Engineer and requested that the di