Delhi High Court - Orders
M/S Corporate Infotech Private Limited ... vs National Technical Research ... on 27 July, 2022
Author: Anup Jairam Bhambhani
Bench: Anup Jairam Bhambhani
$~37
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P.(I) (COMM.) 228/2022
M/S CORPORATE INFOTECH PRIVATE LIMITED THROUGH
ITS AUTHORISED REPRESENTATIVE ..... Petitioner
Through: Mr. Akhil Sibal & Mr. Jayant Mehta,
Senior Advocates with Mr.Bharat
Arora, Mr. Abhishek Singh,
Mr.Gourav Arora & Ms. Deboshree
Mukherjee, Advocates.
versus
NATIONAL TECHNICAL RESEARCH ORGANISATION
THROUGH ITS CHAIRMAN ..... Respondent
Through: Ms. Arunima Dwivedi, CGSC with
Ms. Ashi Sharma, Mr. Ved Prakash,
Mr. Anuj Kumar & Mr. Satbir Singh,
Advocates.
CORAM:
HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI
ORDER
% 27.07.2022 I.A. 11664/2022 (Exemption) Exemption granted, subject to just exceptions. Let requisite compliances be made within 01 week. Application stands disposed of.
O.M.P.(I) (COMM.) 228/2022 & I.A. 11663/2022 (Stay) By way of the present petition under section 9 of the Arbitration & Conciliation Act 1996 ('A&C Act' for short), the petitioner seeks interim measures of protection in relation to disputes that are stated to have arisen from a Contract for Supply, Installation Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:30.07.2022 O.M.P.(I) (COMM.) 228/2022 Page 1 of 4 16:25:50 and Integration of Network Solutions for Establishment of Secured Intranet Infrastructure dated 10.08.2018 signed between the petitioner and the respondent, which (latter) is an organisation functioning under the Government of India.
2. Mr. Akhil Sibal, learned senior counsel appearing for the petitioner draws attention to Clause 3 of Part II of the Standard Conditions of Contract, which comprises the arbitration agreement between the parties; and contemplates reference of disputes, which remain unresolved by mutual consultation, to arbitration under the provisions of the A&C Act; with a further stipulation that arbitral proceedings shall be held at New Delhi.
3. It is the petitioner's case that despite best efforts, the petitioner could not complete the supply, installation and integration of the intranet infrastructure at all 26 sites of the respondent, since the respondent was unable to provide requisite media connectivity at several sites, which was the respondent's obligation under the contract.
4. Mr. Sibal has taken the court through the averments contained in the petition and the documents filed therewith, to submit that of the total amount due under the contract, only a sum of about Rs. 7 crores, which is 10% of the entire amount, now remains due and payable by the respondent to the petitioner.
5. Furthermore, it is submitted that a performance bank guarantee, being Performance Bank Guarantee bearing No. 2158IGPER034818 dated 27.09.2018 issued by the Bank of Baroda, Corporate Finance Service Branch, New Delhi in the sum of Rs.7,14,13285/-,which was furnished by the petitioner to the respondent as part of its contractual Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:30.07.2022 O.M.P.(I) (COMM.) 228/2022 Page 2 of 4 16:25:50 obligations, with validity upto 19.08.2022, is presently being held by the respondent.
6. The immediate genesis of the dispute is a notice dated 08.07.2022 issued by the respondent, stated to have been received by the petitioner on 15.07.2022, whereby the respondent alleges that the tests conducted upon the equipment commissioned and installed by the petitioner have failed. The petitioner apprehends that this notice will lead-upto termination of the contract and invocation of the bank guarantee by the respondent.
7. Upon receipt of notice dated 08.07.2022, the petitioner is stated to have issued to the respondent a legal notice dated 20.07.2022; to which the respondent is yet to reply.
8. In this backdrop, the petitioner seeks several reliefs, of which the relief being pressed today, is only to restrain the respondent from encashing the aforesaid performance bank guarantee.
9. Issue notice.
10. Ms. Arunima Dwivedi, learned counsel appears on behalf of the respondent on advance copy; accepts notice; and seeks time to file a reply.
11. Let reply to the petition be filed within 06 weeks; rejoinder thereto, if any, be filed within 04 weeks thereafter; with copies to the opposing counsel.
12. Mr. Sibal submits that the petitioner is ready and willing to extend the performance bank guarantee by a period of six months beyond its present validity i.e. 19.08.2022, to begin with; and thereafter, as may be directed by this court.
Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:30.07.2022 O.M.P.(I) (COMM.) 228/2022 Page 3 of 4 16:25:5013. On instructions of Mr. Anuj Kumar, Scientist 'D', representing the respondent, Ms. Dwivedi fairly submits that at this stage, the respondent is agreeable to not encashing the performance bank guarantee, subject to the same being kept alive by the petitioner, as may be directed by the court.
14. On a prima-facie view of the matter, it is seen that while the petitioner's claim is for a sum of about Rs.7 crores, comprising 10% of the contractual amount claimed to be due; on the other hand, the respondent is holding a performance bank guarantee in the sum of about Rs. 7 crores, which bank guarantee the petitioner is willing to extend by a period of six months beyond its present validity which is upto 19.08.2022.
15. In the above view of the matter, based on what is fairly submitted by counsel appearing on both sides, it is directed that subject to the petitioner extending the performance bank guarantee for a period of 06 months beyond 19.08.2022, at this stage, the bank guarantee shall not be invoked or encashed by the respondent, without leave of the court.
16. Re-notify on 24th November 2022.
ANUP JAIRAM BHAMBHANI, J.
JULY 27, 2022/uj Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:30.07.2022 O.M.P.(I) (COMM.) 228/2022 Page 4 of 4 16:25:50