Bgsctpl - Vil Consortium v. Airports Authority of India & Anr

NAVIN CHAWLA, J FEBRUARY 13, 2019/rv

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 22.01.2019 Date of decision: 13.02.2019 + O.M.P. (COMM) 140/2016 BGSCTPL - VIL CONSORTIUM ..... Petitioner Through: Mr.K.L. Varghese, Sr. Adv. with Ms.Santha Varghese, Mr.Sanand Ramakrishnan & Mr.Rajeev Mishra, Advs. versus AIRPORTS AUTHORITY OF INDIA & ANR. ..... Respondents Through: Mr.Sachin Datta, Sr. Adv. with Mr.Sonal Kumar Singh, Ms.Prity Sharma & Ms.Paromita Majumdar, Advs. + O.M.P. (COMM) 149/2016 & IA No. 533/2016 AIRPORTS AUTHORITY OF INDIA ..... Petitioner Through: Mr.Sachin Datta, Sr. Adv. with Mr.Sonal Kumar Singh, Ms.Prity Sharma & Ms.Paromita Majumdar, Advs. versus BGSCTPL-VIL CONSORTIUM ..... Respondent Through: Mr.K.L. Varghese, Sr. Adv. with Ms.Santha Varghese, Mr.Sanand Ramakrishnan & Mr.Rajeev Mishra, Advs. CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. These petitions under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act") have been Page 2 filed by the parties to the arbitration proceedings challenging the Arbitral Award dated 11.12.2014 passed by the Sole Arbitrator (hereinafter referred to as the "Impugned Award"). 2. In this order, the Airports Authority of India shall be referred to as the petitioner, while the BGSCTPL - VIL Consortium shall be referred to as the respondent. 3. The disputes between the parties were in relation to the award of Work of construction of new integrated Terminal Building and all allied structures including augmentation of water supply, sewerage system, HVAC, BMS system, internal and external electrification and fire fighting etc. at Madurai Airport awarded by the petitioner in favour of the respondent under Agreement dated 20.12.2007 4. The petitioner has challenged the Award under Claim no. 1A raised by the respondent towards wrong rates applied for quantities exceeding deviation limit. The respondent had claimed an amount of Rs. 46,31,088/-in this claim, while the Arbitrator has awarded a sum of Rs. 4,40,600/- in favour of the respondent. 5. The learned senior counsel for the petitioner submits that the respondent vide its letter dated 22.04.2010 had agreed to the rates for such deviated items. Though the respondent sought to raise a plea that the said letter was addressed under duress, the Arbitrator has rejected the said submission. Having rejected the said submission, the Arbitrator could not have proceeded to re-determine the rates and ignore the ones that have already been approved by the respondent. 6. On the other hand, the learned senior counsel for the respondent submits that the Arbitrator has duly considered the letter dated Page 3 22.04.2010 addressed by the respondent to the petitioner. The Arbitrator has refused to rely upon the same as, in his opinion, the said letter was not preceded by a notice under Clause 11 of the Agreement between the parties. He further places reliance on Clause 57.2 of the Agreement and submits that the respondent was permitted to raise a dispute in respect of any claim within 90 days of receiving the information from the petitioner that the final bill is ready for payment. Therefore, merely because the respondent has accepted the said rate at one stage, would not debar the respondent from raising such claim. 7. The Arbitrator in the Impugned Award has held as under:- "6.8. Where the rates were decreased from the BOQ rates, the Respondents did not provide any evidence to show that notices as required by clause 11.1 was issued at the appropriate time. It stands to common sense and fair play (and is indeed confirmed by clause 11.1) that a proper notice should have been given if the Respondents intended to reduce the rates. The Respondents failed to produce such notices. 6.9. Just as clause 11 puts the onus on the contractor to claim increased rates, Clause 11.1 puts the onus on the Respondents to give notices when the intention is to decrease the rates. Both the Claimant and the Respondent failed to fulfil this basic obligation impo