The National Highways Authority of India v. Afcons-Apil Joint Venture,

NAVIN CHAWLA, J JANUARY 31, 2018/rv

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + Reserved on: 23th January, 2018 Date of decision: 31st January, 2018 THE NATIONAL HIGHWAYS AUTHORITY OF INDIA ..... Petitioner Through: Ms.Pinky Anand, ASG with Mr.Rohit Jain, Mr.Sumit, Ms.Madhu, Ms.S.Mehra, Advs. versus AFCONS-APIL JOINT VENTURE ..... Respondent Through: Mr.Sandeep Sethi, Sr. Adv. with Mr.Manu Seshadri, Mr.Ishan Bisht, Mr.Tanmay Nandi, Advs. CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. This petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Act') has been filed by the petitioner challenging the Arbitral Award dated 14.08.2017 passed by the Arbitral Tribunal. The challenge is confined to the grant of claim no. 1 and claim no. 3. 2. As far as claim no. 1 is concerned, it is submitted by the learned Additional Solicitor General (hereinafter referred to as the 'ASG') that the Engineer while recommending the grant of extension of time for completion of work, had opined that the slow rate of progress achieved was due to respondent's own inefficiency, poor standard of equipments Page 2 and weak project management. It was further recommended that the respondent is not entitled to any additional financial compensation or costs as the respondent's plant and equipment had never been idle as areas were also available for the respondent to work. It is submitted that in terms of Clause 44.2 of the Conditions of Contract, it was the Engineer who was to decide whether and by how much the contract price is to be increased due to 'Compensation Events' and whether and by how much the 'Intended Completion Date' is to be extended; the Engineer having recommended that the respondent is not entitled to any increase in the contract price, the Arbitral Tribunal has erred in granting the same under claim no. 1 in favour of the respondent. 3. It is further contended by the learned ASG that in any case, the Arbitral Tribunal having awarded additional costs on account of Site and H.O. Overheads due to delay in completion of project in favour of the respondent, further amount on account of loss suffered due to lost opportunity to earn profit out of resources owing to delay in completion of works could not have been granted in favour of the respondent by the Arbitral Tribunal. 4. It is further submitted by the learned ASG that the Minority Award has rejected such claim, in her submissions rightly so, on the ground that Clause 44.1 of the Conditions of Contract indicates that there can be a possibility that the project can get extended due to various 'Compensation Events' listed in the said Clause; the Claimant/Respondent herein having quoted for the work knowing fully well that there is a provision in the Contract by which extension of Contract period was a possibility, cannot claim loss of profit due to such Page 3 extension. The Minority Award further held that there was no evidence led by the respondent to prove that the loss suffered by it was due to extension of time for completion of work and respondent's reliance on the NH 24 tender in this regard cannot be sustained. The learned ASG submits that the Minority Award takes the correct view on the dispute and should be accepted by this Court while setting aside the Award passed by the Majority. 5. As far as claim no. 3 is concerned, the same relates to award of interest at the rate of 12% per annum with effect from 10.12.2009. Relying upon Clause 43.1 of the Conditions of Contract, the learned ASG submits that the award of interest for the date prior to the Award, could not have been granted by the Arbitral Tribunal. It is submitted that it is only with the passing of the Award that the amounts awarded in the Impugned Award would get certified and, therefore, no interest can be awarded from the date prior to such certification. 6. I have considered the submissions made by the learned ASG on behalf of the petitioner. As far as the cause of delay in execution of the work is concerned, I