JUDGMENT (ORAL)

12.08.2024

1. This is a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, “the1996Act”hereinafter for appointment of an Arbitrator to arbitrate on the disputes between the parties.

2. The disputes arise in the context of an Engineering, Procurement and Construction (EPC) Contract dated 1 June 2020, executed between the petitioner and the respondent. The petitioner was contracted for transforming a two lane stretch of NH 117 to a 4 lane stretch.

3. Article 26 of the contract between the parties envisages resolution of disputes by arbitration. Sub Article 26(1), 26(2) and 26.3(i) thereof, read thus :

“26.1DisputeResolution

(i) Any dispute, difference or controversy of whatever nature howsoever arising under or out of or in relation to this Agreement (including its interpretation) between the Parties, and so notified in writing by either Party to the other Party (the "Dispute") shall, in the first instance, be attempted to be resolved amicably in accordancewiththeconciliationprocedureset forthin Clause26.2.

(ii) The Parties agree to use their best efforts for resolving all Disputes arising under or in respect of this Agreement promptly, equitably and in good faith, and further agree to provide each other with reasonable access during normal business hours to all non- privilegedrecords, informationanddatapertainingtoanyDispute.

26.2Conciliation

In the event of any Dispute between the Parties, either Party may call upon the Authority's Engineer, or such other person as the Parties may mutually agree upon (the "Conciliator") to mediate and assist the Parties in arriving at an amicable settlement thereof. Failing mediation by the Conciliator or without the intervention of the Conciliator, either Party may require such Dispute to be referred to the Chairman of the Authority and the Chairman of the Board of Directors of the Contractor for amicable settlement, and upon such reference, the said persons shall meet no later than 7 (seven) business days from the date of reference to discuss and attempt to amicably resolve the Dispute. If such meeting does not take place within the 30 (thirty) business day period or the Dispute is not amicably settled within 30 (thirty) days of the meeting or the Dispute is not resolved as evidenced by the signing of written terms of settlement within 30 (thirty) days of the notice in writing referred to in Clause 26.1.1 or such longer period as may be mutually agreed by the Parties, either Party may refer the Dispute to arbitration in accordance with the provisions of Clause 26.3 but before resorting to such arbitration, the parties agree to explore conciliation by the Conciliation Committees ofIndependent Experts set up by the Authority in accordance with the procedure decided by the panel of such experts and notified by the Authority on its websiteincluding its subsequent amendments. In the event of the conciliation proceedings being successful, the parties to the dispute would sign the written settlement agreement and the conciliators would authenticate the same. Such settlement agreement would then be binding on the parties in terms of Section 73 of the Arbitration Act. In case of failure of the conciliation process even at the level of the Conciliation Committee, either party may refer the Dispute to arbitration in accordance with the provisions ofClause26.3.

26.3Arbitration

(i) Any dispute which remains unresolved between the parties through the mechanisms available/ prescribed in the Agreement, irrespective of any claim value, which has not been agreed upon/reached settlement by the parties, will be referred to the Arbitral Tribunal as pertheArbitrationandConciliationAct.”

4. As disputes arose between the parties, the petitioner wrote to the Managing Director of the respondent on 2 January 2023 submitting that as the Engineer of the respondent had already communicated, in writing, disagreeing with the petitioner’s claim, referring the matter to the Authority Engineer (AE