Delhi High Court - Orders
Ssangyong Engineering And ... vs National Highways Authority Of India ... on 13 April, 2023
Author: Chandra Dhari Singh
Bench: Chandra Dhari Singh
$~38
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P.(I) (COMM.) 112/2023
SSANGYONG ENGINEERING AND CONSTRUCTION CO. LTD.
..... Petitioner
Through: Mr. Navin Kumar, Ms. Rashmeet
Kaur, Ms. Aarti Mahto and Ms.
Bhagya Ajith, Advocates
versus
NATIONAL HIGHWAYS AUTHORITY OF INDIA (NHAI) &
ORS. ..... Respondents
Through: Mr. Ankur Mittal and Mr. Yash
Kapoor, Advocate for R-1
Mr. Ashish Rana, Advocate for R-
2/Bank of India (Through VC)
CORAM:
HON'BLE MR. JUSTICE CHANDRA DHARI SINGH
ORDER
% 13.04.2023
I.A. 6881/2023 (Exemption)
Subject to the petitioner filing the clear, original and legible/typed copies of any dim documents on which the petitioner may seek to place reliance, within four weeks from today, exemption is granted for the present.
The application is disposed of.
O.M.P.(I) (COMM.) 112/2023
1. The instant petition under Section 9 of the Arbitration and Signature Not Verified Digitally Signed By:DAMINI YADAV Signing Date:18.04.2023 13:00:47 Conciliation Act, 1996 read with Section 151 of the Code of Civil Procedure, 1908 has been filed on behalf of the petitioner seeking the following reliefs:
"a) restrain the Respondent No.1 from seeking further extension of the following Bank Guarantees and direct the Respondent to release the originals of the same to the Petitioner :
b) restrain the Respondent No.1 from en cashing the above stated Bank Guarantees;
in the alternative
a) maintain status quo till the time for filing Section 36 of the Arbitration and Conciliation Act, 1996 expires and direct the Respondent to deposit the cost of any charges towards extension of the above Bank Guarantees with the Hon'ble court and/or direct the Respondent to bear all expenses of any additional cost towards further extension of the above Bank Guarantees;
b) Pass such other or fm1her orders as this Hon'ble Tribunal may deem fit and proper in the facts of the case and in the interest of justice."
2. Learned counsel appearing on behalf of the petitioner submitted that the petitioner is aggrieved of the wrongful and illegal retention of its Performance Bank Guarantees (PBG) as well as the Retention Money Bank Signature Not Verified Digitally Signed By:DAMINI YADAV Signing Date:18.04.2023 13:00:47 Guarantee (RMBG) by the respondent despite the issuance of a recent Arbitral Award dated 9th April, 2023 passed in arbitration proceedings between the parties whereby it has been adjudicated that the said Bank Guarantees of the Petitioner was due to be returned by the respondent latest by 8th April, 2016.
3. It is submitted that these Bank Guarantees are valid only up to 21st April, 2023 and the petitioner has reasons to believe that the respondent will proceed to encash the said Bank Guarantees before 21st April, 2023. The aforesaid Bank Guarantee has been kept alive by the petitioner during the pendency of the arbitration proceedings by making as many as six extensions and are now valid up to 21st April, 2023. It is pertinent to note that aforesaid Bank Guarantees were originally to remain valid for a period of 30 months approx. i.e. sometimes up to the end of 2008. Since the contract was prolonged these Bank guarantees were to be kept alive till about April 2016. It has been held by the learned Arbitral Tribunal that after the expiry of the Defects Liability Period, said PBG and RMBG were retained by the respondent illegally and ought to have been returned to the petitioner as of 8th April, 2016 and 26th February, 2016.
4. It is submitted that while adjudicating upon the disputes between the parties in this regard, the learned Arbitral Tribunal has now made an Award dated 9th April, 2023 holding inter alia that the respondent is not entitled to any counterclaim against the petitioner and that the said Bank Guarantees were due to be returned to the petitioner as on 8th April, 2016 itself. The Award also awards to the petitioner all cost towards extension of the Bank Guarantees from 8th April, 2016 till the last extension of the Bank Guarantee whereby validity of Bank Guarantees was extended up to 21st April, 2023.
Signature Not Verified Digitally Signed By:DAMINI YADAV Signing Date:18.04.2023 13:00:475. It is submitted that special equities arise in favor of the petitioner and it would be in the interest of justice that this Court may restrain the respondents from seeking an extension of the Bank Guarantees and return the same to the petitioner forthwith. It is submitted that the petitioner is not in a position to keep these Bank Guarantees valid for any further period as the said extension of Bank Guarantee requires an extension of counter Bank Guarantees of foreign banks and this would result in a huge cost to the Petitioner. It is submitted that since a foreign bank is involved for issuance of these Bank Guarantees, the extension of the same is a time taking process and requires almost a period of one month. In any case all cost of extension of such Bank Guarantees till 21st April, 2023 has been awarded to the petitioner with interest vide Award dated 9th April, 2013 and since the Award has already been published, the dispute in this regard has come to an end.
6. Heard.
7. Issue notice. Learned counsel appearing on respondent no. 1 accepted notice and vehemently opposed the instant petition. He prayed for ten days' time to file reply/objection. Let the same be filed within ten days as prayed.
8. List on 20th April, 2023.
9. It is directed that the respondent no. 1 shall issue a prior notice of one week to the petitioner before invoking the Bank Guarantee, if any.
CHANDRA DHARI SINGH, J APRIL 13, 2023 gs/ak Click here to check corrigendum, if any Signature Not Verified Digitally Signed By:DAMINI YADAV Signing Date:18.04.2023 13:00:47