*

IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on: 22.12.2014

Pronounced on: 30.04.2015

+

FAO(OS) 21/2009

PURI CONSTRUCTION P. LTD. AND ORS…

……Appellants.

Versus

LARSEN AND TOUBRO LTD. AND ANR.

……..Respondents

+

FAO(OS) 22/2009

MOHINDER PURI

…

……Appellant

Versus

LARSEN AND TOUBRO LTD. AND ANR.

……..Respondents

+

FAO(OS) 23/2009

PURI CONSTRUCTION P. LTD. AND ORS…

……Appellants.

Versus

LARSEN AND TOUBRO LTD. AND ANR.

……..Respondents

+

FAO(OS) 194/2009

M/S. LARSEN AND TOUBRO LTD.

……Appellant

Versus

PURI CONSTRUCTION LTD. AND ORS. .

……..Respondents

Through: Sh. Arvind Nigam, Sr. Advocate with

2015:DHC:3916-DB

Sh. M.R. Shamshad, Sh. Shashank Singh and Sh.

Abdullah Umar, Advocates, for petitioner in

FAO(OS)21/2009 and

FAO(OS)23/2009 and

respondent in FAO(OS)194/2009.

Sh. Ram Jethmalani, Sr. Advocate with Sh. Neeraj

Malhotra and Sh. P. Garg, Advocates, for

appellant in FAO(OS)22/2009 and Respondent

No.3 in FAO(OS)194/2009.

Sh. Ashok. H. Desai, Sr. Advocate with Sh.

Sameer Parekh, Ms. Rukmini Bobde, Sh. Kumar

Shashank, Ms. Sanjana Ramachandran and Sh.

Abhishek Vinod Deshmukh, Advocates, for L&T.

CORAM:

HON'BLE MR. JUSTICE S. RAVINDRA BHAT

HON'BLE MR. JUSTICE NAJMI WAZIRI

MR. JUSTICE S. RAVINDRA BHAT

%

1.

These appeals under Section 37 of the Arbitration and Conciliation

Act, 1996, (hereafter “the Act”) are preferred against the judgment and order

of the learned Single Judge dated 26.11.2008, in O.M.P. No. 26/2003. The

impugned judgment set aside the order of the learned Sole Arbitrator who

constituted the arbitral tribunal (hereafter “the Tribunal”), under Section 34

of the Act. The Tribunal had upheld claims by Puri Constructions Ltd and its

sister concerns (collectively referred to as “PCL”) against Larsen and

Toubro Ltd (“L&T”) and awarded, upon a finding of economic coercion of

PCL, damages to the tune of `35 crores against L&T on account of breach

of contract. L&T was directed to settle the claims of Lord Krishna Bank

(“LKB”) within four weeks - by repayment of loan of ` 6 crores with such

interest that may be due and payable. A further direction to L&T was issued

2015:DHC:3916-DB

to secure the release of title deeds of 15 acres of land from the bank and to

reimburse PCL’s interest charges and in default pay a sum of `75 crores for

loss of saleable area in respect of the said 15 acres of land mortgaged with

the LKB, within 4 weeks. Other consequential directions were issued in the

award.

2.

PCL and its sister companies were in possession of vast stretches of

land in Gurgaon District, Haryana. PCL secured licenses from the Director,

Town and City Planning, Haryana (hereafter “Town Planner”) to develop

these lands for residential group housing scheme purposes. Initially, PCL

had entered into an agreement with ITCREF (another company) and formed

a joint venture known as 'Florentine India Ltd' to develop these lands for

residential group housing project purposes. In terms of this joint venture,

ITCREF funded PCL for purchasing other lands and acquiring licenses etc.

Later, however, ITCREF decided to exit from property development

business. For this purpose, it negotiated with PCL and introduced L&T into

the project. ITCREF had unsettled claims against PCL. To secure its claim

ITCREF mandated that its interests in the project should be mentioned in the

agreement between PCL and L&T.

3. L&T (appellant in FAO(OS) 194/2009) and PCL (appellant in FAO

(OS) Nos. 21-23/2009) entered into an agreement for land development

(hereafter “the Development Agreement”) on 10-03-1998 (signed on 19-01-

1998). After the Development Agreement, a Supplementary Agreement was

entered into between the two on 30-12-1999 (called “Supplementary

2015:DHC:3916-DB

Agreement”). Pursuant to the Supplementary Agreement, a Tripartite

Agreement was entered into between PCL, L&T and Lord Krishna Bank

(LKB) on 10-01-2000 (hereafter “Tripar