National Highway Authority of India v. Rohtak Panipat Tollway Pvt. Ltd

judgment." (Emphasis Supplied)

¶46A reading of the above observations/findings of the learned Arbitral Tribunal would show that the learned Arbitral Tribunal has concluded that the said letter dated 18.09.2013 does not indicate any work outstanding towards the safety of the road.

¶47For appreciating the above findings, the letter dated 18.09.2013, so far as it is relevant to the present petition, is reproduced hereinbelow:-"We have examined the request of the Concessionaire for grant of Provisional Completion Certificate from km. 0+000 to km. 75+765. Our recommendations are as under:-

As per clause no. 14.3.2 (Article 14), of Concession Agreement "The Parties hereto expressly agree that a Provisional Certificate under this clause 14.3 may, upon request of the Concessionaire to this affect be issued for

operating part of the Project Highway, if at least 75% (seventy five per cent) of the total length of the Project Highway has been completed. Upon issue of such Provisional Certificate, the provisions of Article 15(ENTRY INTO COMMERCIAL SERVICE) shall apply to such completed part."

The Concessionaire has completed the project highway in a length of 75.765 (km 04000 to 75+765) out of total project length of 80.858 which is 93.70% of total project length. The completed 93.70% of the project highway is more than 75% of the total project length.

xxxxx

All the tests as required under Article 14 of the Concession Agreement to check the compliance of the project highway to the provisions of Schedule have been conducted in the presence of the I.E.'s representatives and Concessionaire's representative's. A list showing the status of various tests is enclosed as Annexure-I.

3 lists of outstanding works of the Project Highway have been prepared after Joint Inspection by the Independent Engineer and Concessionaire on 16.08.2013, 17.08.2013 and 04.09.2013 which are as under:-

(i) Appendix-A1 & A2 cover the Items of work which the Concessionaire will complete before issue of Provisional Completion Certificate.

(ii) Appendix B-The Punch list covers items which do not affect the safe Operation of the Project Highway and will be completed by the Concessionaire within 90 days of the issuance of the Provisional Completion Certificate as per clause no.

14.4.1 (Article 14) Vol-I of Concession Agreement.

(iii) Appendix-C covers Items of works, which could not be undertaken due to Land

Acquisition Issues and for reasons attributed to NHAI.

The Concessionaire has confirmed vide their letter no. SEL/RP/SITE/IC/1424 dt. 05.09.2013 that

(i) Items of Appendix-A1 & A2 will be completed before issue of Provisional Completion Certificate.

(ii) Items of Punch List Appendix-B will be completed within 90 days of the issue of Provisional Completion Certificate.

(iii) Items of Appendix-C will be completed as and when land is made available by NHAI.

xxxxx

The provision of the Article 14.3 permit the Independent Engineer to Issue Provisional Certificate at the request of Concessionaire if the tests are successful as per Schedule "I" of CA and the Project Highway can be safely and reliably placed to commercial operation. However, the Clause 12 of TOR of the Independent Engineer Consultancy Agreement with NHAI requires IE to take prior approval of NHAI before the issuance of the Provisional Certificate. The prior approval for issuance of Provisional Certificate is being sought vide this letter to enable the Concessionaire to commence Commercial Operation at the earliest. The draft Provisional Certificate as per Schedule "J" of Concession Agreement for the completed part of the Project Highway is attached herewith for your kind perusal (Annexure-II). Based on the above facts we are of the opinion that Project Highway can be safely and reliably placed in Commercial Operation." (Emphasis supplied)

¶48Appendix A-1 to the said letter is titled as under:-

"ITEMS REQUIRED TO BE COMPLETED BEFORE ISSUE OF PROVISIONS COMPLETION CERTIFICATE"

¶49Similarly Appendix A-2 is titled as under:- "Items required to be completed before issue of Provisional Completion Certificate – As per Safety Consultant."

¶50Clearly, therefore, by the above letter the IE had opined that the respondent shall have to complete the items of work mentioned in Appendix A-1 and A-2 to the said letter. The work mentioned in Appendix A-1 was to be completed by the respondent before issuance of PCC. It was based on the undertaking given by the respondent that these items will be completed before the issuance of the PCC, that the IE submitted the draft Provisional Certificate for the approval of the petitioner. The reliance of the learned Arbitral Tribunal on the said letter to conclude that no issue of safety was raised by the IE or that the said letter amounts to an unconditional opinion of the IE to the grant of Provisional Certificate to the respondent is, therefore, completely perverse and unfounded and against the bare reading of the letter itself. The opinion of the IE that the "Project Highway can be safely and reliably placed in Commercial Operation" was based on the undertaking of the respondent that it shall complete the work mentioned in Appendix A-1 to the letter before grant of PCC. It was therefore, conditional in nature and could not operate unless the respondent completes the work mentioned in Appendix A-1 to the letter to the satisfaction of the IE. The learned Arbitral Tribunal has, however, taken the said letter as an unconditional opinion of the IE that the PCC can be granted to the respondent. This finding, therefore, cannot be sustained.

¶51In fact, the learned senior counsel for the petitioner has also drawn my reference to the subsequent letter dated 25.10.2013 of the "Team Leader", which in turn records the Compliance Report of Pre-COD Safety Audit Report, and which in turn lists out certain items for which the IE has reported the work to be still in progress. The learned Arbitral Tribunal has ignored the said letter altogether. The said letter shows that even as on 25.10.2013 certain work to make the Project Highway safely and reliably to be put in Commercial Operation were pending at the end of the respondent.

¶52The learned Arbitral Tribunal while awarding Claim no.2 has taken 15 days from the date of the above letter as the start point for the loss of revenue awarded to the respondent. In view of my observation hereinabove, the start point for award of the claim to the respondent is therefore, contrary to the evidence on record and cannot be upheld.

¶53The learned counsel for the respondent, faced with the above, submitted that as Clause 14.3.2 provides that the PCC can be granted on completion of 75% of the Project Highway, whereas the respondent had sought the same on completion of 93.7% of the Project Highway, the work that was still remaining could not come in the way of grant of PCC to the respondent.

¶54In my opinion, however, as the learned Arbitral Tribunal has not considered the above submission nor has rendered its findings based thereon; the same being a factual issue, it is not for this Court to adjudicate thereon and to hazard a guess thereon while exercising its jurisdiction under Section 34 of the Act. This plea was to be considered by the learned Arbitral Tribunal at the first instance and cannot be considered by this Court in absence thereof.

¶55In view of the above, the Impugned Award on Claim no.2, even applying even the limited jurisdiction that this Court possesses under Section 34 of the Act, cannot be sustained.

RELIEF:

¶56In view of the above, the challenge of the petitioner to the impugned Arbitral Award on Claim no.1 is rejected. The Impugned Award, so far as it grants Claim no.2 in favour of the respondent, is, however, set aside.

¶57The petition is disposed of in the above terms.

¶58There shall be no order as to costs.

NAVIN CHAWLA, J. FEBRUARY 16, 2023/rv/DJ

* IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on:17.01.2023 Date of decision:16.02.2023 + O.M.P. (COMM) 286/2018 & I.A. 8863/2018, I.A. 2943/2019 NATIONAL HIGHWAY AUTHORITY OF INDIA ..... Petitioner Through: Mr.Narender Hooda, Sr. Adv. with Mr.Arun Kumar Batta, Ms. Neha Kumari, Mr. Abdul Wahid, Ms. R. Ahuja, Mr.Shaurya Lamba, Advs. versus ROHTAK PANIPAT TOLLWAY PVT. LTD. ..... Respondent Through: Ms.Roopali Chaturvedi and Ms.Sadiqua Fatima, Advs. CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. The present petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act"), challenging the Arbitral Award dated 06.10.2017 passed by the learned Arbitral Tribunal, as well as the order dated 20.02.2018 passed by the learned Arbitral Tribunal on an application under Section 33(1)(a) and (b) of the Act. 2. The disputes between the parties arose out of the Agreement for the work of "Four Laning of Rohtak - Panipat Section of NH-71A from KM 0.00 (KM 63.00 OF NH 10) to KM 80.858 (KM 83.39 of NH-1) in the State of Haryana under the NDPH Phase III on Design, Build, Finance, Operate and Transfer ("DBFOT") Basis" awarded by the petitioner to the respondent. 3. By the Impugned Award, the learned Arbitral Tribunal has allowed the claims of the respondent herein. SUBMISSIONS OF THE LEARNED SENIOR COUNSEL FOR THE PETITIONER: CLAIM NO. 1 4. Claim no.1 of the respondent was towards additional lead required for transportation of material on site. The learned senior counsel for the petitioner submits that the mining operation in the State of Haryana was lying closed since 01.03.2010. He submits that the Concession Agreement was signed between the parties on 09.03.2010 and the work commenced in April 2011, that is, after the closure of the mining operation. He submits that, therefore, the respondent could not have been allowed to take the benefit of Clause 41.1 of the Concession Agreement which provides for increase in costs due to change in law. 5. He submits that the claim for additional lead was raised by the respondent for the first time vide letter dated 13.05.2014, while the notice claiming arbitration was issued on 11.02.2016. He submits that, therefore, not only is the claim not maintainable in terms of the Concession Agreement, but is also barred by the Law of Limitation. 6. Placing reliance on Geo Miller and Company Private Ltd. v. Chairman, Rajasthan Vidyut Utpadan Nigam Limited., (2020) 14 SCC 643 and Bharat Sanchar Nigam Limited & Another v. Nortel Networks India Private Ltd., (2021) 5 SCC 738, the learned senior counsel for the petitioner submits that as the cause of action arose on 01.03.2010 and the notice claiming arbitration was issued only on 11.02.2016, the claim was barred by limitation. He submits that the learned Arbitral Tribunal has ignored these important facts in adjudicating the claim no.1 in favour of the respondent. 7. He further submits that as per the Government Order dated 21.04.2012, sand mine in the Districts of Sonepat and Panipat and two small stone mines in the District of Mahendergarh remained operational even after 01.03.2010. Therefore, there was no compelling reason for the respondent to have allegedly chosen to procure the material from outside the State of Haryana. In any case, for this unilateral decision of the respondent, its claim for differential in prices was not justified and could not have been granted. 8. He submits that the learned Arbitral Tribunal has erroneously placed reliance upon the Feasibility Report, despite the fact that the Clause 2.13 of the RFP clearly states that the Feasibility Report is only a preliminary document and that nothing contained therein would be binding upon the Authority nor would it confer any right on the bidders. He submits that the Feasibility Report was only for the purpose of appraising the Concessionaire about the topography of the area and other different details mentioned in the said document, which ar