$~J * IN THE HIGH COURT OF DELHI AT NEW DELHI Judgment reserved on: 03.02.2025 Judgment pronounced on: 17.04.2025 + ARB. A. (COMM.) 43/2024 & I.A. 36399/2024, I.A. 44028/2024 NATIONAL HIGHWAYS AUTHORITY OF INDIA .....Appellant Through: Mr. Tushar Mehta, Solicitor General with Mr. Manish Bishnoi, Ms. Gunjan Sinha Jain, Ms. Muskaan Gopal, Mr.

Khubaib Shakeel, Advs.

versus HK TOLL ROAD PVT. LTD.

.....Respondent Through: Mr. Mr. Parag Tripathi, Sr. Adv. with Mr. Vijayendra Pratap Singh, Mr. Aditya Jalan, Mr. Aditya Ganju, Ms. Shruti Garg, Mr. Pradyumna Sharma, Mr. Bharat Makan, Ms. Khushi Mittal, Ms. Mishika Bajpai, Advs.

CORAM:

HON'BLE MR. JUSTICE JASMEET SINGH

J U D G M E N T

: JASMEET SINGH, J INDEX TO THE JUDGMENT Digitally Signed ARB. A. (COMM.) 43/2024 Page 1 of 68 THE CHALLENGE ..............................................................................2 FACTUAL BACKGROUND ...............................................................3 RIVAL CONTENTIONS .....................................................................8 ON BEHALF OF NHAI ...............................................................................8 ON BEHALF OF THE RESPONDENT .......................................................... 14 REJOINDER ON BEHALF OF NHAI .......................................................... 19 ANALYSIS AND FINDINGS ........................................................... 20 SCOPE OF SECTION 37(2)(B) OF 1996 ACT ............................................. 20 AMBIT OF SECTION 17 OF 1996 ACT ...................................................... 25 WHETHER SOC IS SINE QUA NON FOR FILLING SECTION 17 APPLICATION. .............................................................................................................. 32 APPLICABILITY OF THE PROVISIONS OF AMENDED SECTIONS OF SRA. ... 35 ON MERITS QUA TERMINATION NOTICE DATED 22.01.2024.................. 65 CONCLUSION ................................................................................... 67 THE CHALLENGE

1. This is a petition filed under section 37 of Arbitration and Conciliation Act, 1996 (“1996 Act”) seeking setting aside of the order dated 08.08.2024 (“impugned order”) passed by the learned Arbitral Tribunal (“AT”) in the ongoing Arbitration Proceedings between HK Toll Road Pvt. Ltd. vs. National Highway Authority of India (“NHAI”) wherein the learned AT while deciding application filed under section 17 of 1996 Act by the respondent, directed as under:-

28.……………………. For all the foregoing reasons & in view of the legal position holding the field and given that the concerns raised by the Tribunal qua the financial Digitally Signed ARB. A. (COMM.) 43/2024 Page 2 of 68 wherewithal of the Claimant to execute Stage Construction Works stands addressed, this Tribunal issues the following directions:

28.1. The operation of the Termination Notice bearing No. NHAI/HQ/TN Div./HK/E-175436 dated 22.01.2024 issued by the Respondent is stayed till final determination in the present arbitral proceedings or till such further orders as maybe passed by the Tribunal;

28.2. The toll collected from the users of the Highway shall be deposited in the Escrow Account maintained by the parties.

28.3. The Claimant will execute the balance Stage Construction Works and complete the same expeditiously.

28.4. The security furnished by the Claimant by way of demand drafts will be put in a non-lien account within 2 weeks from the date of this Order which would remain under the directions of the Tribunal.

29. The Tribunal clarifies that the views expressed in this Order are prima facie. All rights and contentions of the parties are left open to be advanced in relation to the issues that may fall for consideration before this Tribunal.”

FACTUAL BACKGROUND

2. On 02.07.2010, the appellant i.e. NHAI and the respondent entered into a Concession Agreement (“Agreement”) for construction, operation and maintenance (“O&M”) of the existing road on Hosur- Krishnagiri Section of NH-7 from KM 33.130 to KM 93.00 (