Bangalore District Court
M/S.Karnataka Road Development vs ) M/S.Brindavan Infrastructure on 8 June, 2020
IN THE COURT OF THE VI ADDL.CITY CIVIL & SESSIONS JUDGE
BENGALURU CITY
CCCH No. 11
DATED THIS THE 08TH DAY OF JUNE, 2020
PRESENT : Sri.Rama Naik, B.Com., LL.B.,
VI Addl.City Civil & Sessions Judge,
Bengaluru City.
A.S.No:96/2013
C/W
A.S.NO:109/2013
PLAINTIFF M/s.Karnataka Road Development
Corporation Limited
[In AS.No.96/2013] 1st Floor, # 16/J, Thimmaiah Road Cross
Miller Tank Bed Area,
Vasanthanagar, Bengaluru -560 052.
Reptd.by its Managing Director -
Mr.K.S.Krishna Reddy.
[By Pleader Sri.Aditya Sondhi]
[In Public Works Department
AS.No.109/2013] Government of Karnataka,
Multi Stories Building, Vidhana Veedhi,
Bengaluru -560 001.
Reptd. By its Authorised Signatory.
[By Pleader Smt.B.V.Nidhishree]
VS.
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2
DEFENDANTS 1) M/s.Brindavan Infrastructure
Co.Ltd.
[In AS.No.96/2013] No.13, 6th Cross, Jayamahal
Extension,
Nandi Durga Road,
Bengaluru -560 046.
[By Pleader Sri.C.K.Nandkumar]
2) The Principal Secretary,
Public Works Department
Government of Karnataka,
Multistories Building,
Vidhana Veedhi,Bengaluru -560 001.
[Exparte]
3) Mr.L.V.Sreerangaraju,
Presiding Arbitrator
No.537, 'Jyeshta' 3rd Main,
Hosakerehalli Cross, BSK III Stage,
III Main, Bengaluru -560 085.
4) Mr.V.Krishnamurthy,
Arbitrator,
"Krishna", No.483/36, 19th Main,
34th Cross, 4th 'T' Block, Jayanagar,
Bengaluru -560 041.
5) Mr.R.Basavanagouda,
Arbitrator
No.32, Taralabalu Enclave,
Bellary Road, Near Police Station,
Yelahanka, Bengaluru -560 064.
[Arbitrators]
1) M/s.Brindavan Infrastructure
[In AS.No.109/2013] Co.Ltd.
No.13, 6th Cross, Jayamahal
Extension,
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3
Nandi Durga Road,
Bengaluru -560 046.
[By Pleader Sri.C.K.Nandkumar]
2) M/s.Karnataka Road
Development Corporation
Limited,
1st Floor, # 16/J,
Thimmaiah Road Cross
Miller Tank Bed Area,
Vasanthanagar, Bengaluru -560 052.
Reptd.by its Authorised Signatory.
[By Pleader Sri.Aditya Sondhi]
3) Mr.L.V.Sreerangaraju,
Presiding Arbitrator
No.537, 'Jyeshta' 3rd Main,
Hosakerehalli Cross, BSK III Stage,
III Main, Bengaluru -560 085.
4) Mr.V.Krishnamurthy,
Arbitrator,
"Krishna", No.483/36, 19th Main,
34th Cross, 4th 'T' Block, Jayanagar,
Bengaluru -560 041.
5) Mr.R.Basavanagouda,
Arbitrator
No.32, Taralabalu Enclave,
Bellary Road, Near Police Station,
Yelahanka, Bengaluru -560 064.
[Arbitrators]
--
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4
COMMON JUDGMENT
These suits are filed by Plaintiffs
[Respondents No.1 and 2 in arbitral proceedings]
under Section 34 of the Arbitration and Conciliation
Act, 1996, Read with Rule 5 of the High Court of
Karnataka Arbitration (Proceedings before the
Courts Rules, 2001), for setting aside the award
dated 09.08.2013.
2) As both suits are arising out of single award
dated 09.08.2013, for the convenience of the
Court, they are taken together for passing common
judgment.
3) Facts infra, as stated by Plaintiff in AS
No.96/2013 are, Plaintiff is a Public Limited
Company wholly owned by the Government of
Karnataka established inter alia to promote surface
infrastructure by taking up road works amongst
other things.
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4) It is stated that, Plaintiff entered into a
Tripartite Concession Agreement dated 22.01.2004
to upgrade the erstwhile 2 Lane Bengaluru-Maddur
Section (11.6 Km to 45.4 Km, 51.2 km to 59.6 km,
62.1 km to 82.05 km) of Bengaluru-Mysore State
Highway (SH-17) to a 4 Lane divided carriageway.
Defendant No.1 was selected to undertake the
Project on a Build, Operate and Transfer basis on
Annuity Payment basis. Defendant No.1 was to
design, engineer, procure, finance, construct,
operate and maintain the Project/Project facilities.
Concession period was 10 years from the
commencement date including implementation
period. Project completion date was 24 months
from commencement date. Defendant No.1 was at
all times requires to adhere to the Construction
Requirements and achieve Commercial Operations
date on or before the project completion date.
Defendant No.2 was to pay to Defendant No.1
Rs.29,70,00,000/- on each Annuity Payment Date
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subject to the provisions of the Agreement.
Agreement also provided for bonus/reduction in
Annuity for early or delayed completion, as
applicable, determinable by an 'X' factor. Plaintiff
was required to handover 50% of the project site
within one month of the Agreement and balance
50% within six months. Despite facing severe
difficulties with respect to acquisition of land,
Plaintiff duly handed over the project site and
Defendant No.1 commenced work on 04.03.2004.
Defendant No.1 attained financial closure on
22.04.2004. Project Engineer declared 22.04.2004
to be the commencement date accordingly.
Commercial Operation Date of the Project was
30.06.2006.
5) It is stated that, during the course of
Agreement, certain disputes arose between the
parties, pursuant to which, Defendant No.1 initiated
arbitration proceedings. Arbitral Tribunal was
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constituted on 26.11.2009. After lengthy
proceedings, Tribunal passed an award dated
09.08.2013 awarding Defendant No.1 a sum of
Rs.43,30,15,727/- with simple interest at 15.5% per
annum till date of award, amounting to
Rs.44,86,57,604/- and allowed Claim Nos.1 to 5 of
Defendant No.1. Being aggrieved, Plaintiff has
challenged the said impugned award on the
following grounds :
(1) Impugned award is contrary to the
letter and spirit of the Arbitration and
Conciliation Act, 1996, particularly Section
34 thereof, the substantive law applicable
to the dispute, terms of Agreement,
evidence on record and case of the parties
put forth respectively.
(2) Impugned award is patently illegal
and opposed to public policy and opposed
to the terms of Agreement entered into
between the parties.
(3) Impugned award has grossly
misinterpreted the commencement date of
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the Agreement. Arbitral Tribunal has failed
to consider that financial closure was duly
achieved by Defendant No.1 as on
22.04.2004 and that Defendant No.1 had
chosen to proceed with the work at its own
risk and consequence. Indeed Defendant
No.1 had chosen to commence work as on
04.03.2004 at its own risk which by conduct
and by Agreement was deemed to be the
date of commencement.
(4) Impugned award is contrary to the
express provisions of the Agreement,
particularly Clause 5.4(a)(iii) whereby,
Defendant No.1 was permitted and in fact,
did commence construction works at its
own risk and cost. Under said clause
Defendant No.1 is precluded from seeking
any compensation in respect thereof from
the Plaintiff. Said clause is valid and binding
on both parties and as such, there could
have been no compensation awarded based
on commencement date calculated as on
22.07.2004 as has been erroneously done
under impugned award.
(5) Impugned award ignores the fact
that Defendant No.1 itself vide its letter
dated 15.11.2006 had duly accepted the
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commencement date as 22.04.2004. Said
communication binds the Defendant No.1.
Impugned award fails to notice that vide
said letter, Defendant No.1 had
categorically accepted the commencement
date and the said acceptance was binding
on the tribunal.
(6) Impugned award ignores the fact that
certain force majeure conditions inhibited
Plaintiff from fully handing over the site and
as such, in any case, without prejudice,
Arbitral Tribunal could not have awarded
compensation to Defendant No.1 by
invoking the later date at the date of
commencement.
(7) Impugned award has misdirected
itself by relying on stray letters written by
Project Engineers, when in fact, the
Agreement, correspondence and
significantly the conduct of the Defendant
No.1 left no room for doubt that the date of
commencement was 22.04.2004 and that
no compensation was payable to Defendant
No.1.
(8) Impugned award ignores the fact
that claim made by Defendant No.1 was
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squarely hit by limitation. Notice invoking
arbitration was sent only as on 19.12.2009,
when in fact, the cause of action for
Defendant No.1 arose on 22.07.2004 or at
any rate on 30.10.2004 when the Project
Engineer determined the commencement
date as 22.04.2004.
(9) Arbitral Tribunal has entirely
misdirected itself in relying on the time
spent on purported negotiation among the
parties when in fact the mere exchange of
correspondence with respect to such
purported negotiation would in no manner
extend the period of limitation.
(10) Arbitral Tribunal has failed to notice
that in any case the time period prescribed
for possible settlement under clause 16.1(b)
was merely 15 days after which the parties
were at liberty to submit their disputes to
arbitration. In the given case, an
extraordinary period of close to 5 years has
been sought to be excluded on the weak
ground that the parties were in negotiation.
Ex-facie the claim of Defendant No.1 was
liable to be dismissed on the ground of
limitation.
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(11) Impugned award erroneously
records that Plaintiff has waived its right to
raise limitation as a defence. Arbitral
Tribunal has failed to appreciate that the
provision of Limitation Act is applicable to
arbitrations as it applies to proceedings in
court vide Section 43 of the Arbitration and
Conciliation Act,1996. Section 3(1) of the
Limitation Act, 1963 provides that any
proceedings initiated after the period of
limitation shall be dismissed even if
limitation has not been set up as a defence.
(12) Various Judgments relied upon by
the Arbitral Tribunal in order to hold the
issue of limitation in favour of Defendant
No.1 are inapplicable and in any case
contrary to the express provisions of the
statute and distinguishable on the facts of
the case, wherein, as early as 30.10.2004
there was an express determination of the
issue of commencement date.
(13) Impugned award is contrary to the
express provisions of the Agreement,
whereby, the outer limit for any amicable
resolution of the disputes was 15 days and
on this sole ground the impugned award is
liable to be set aside.
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(14) Impugned award has grossly
misinterpreted the provisions relating to
force majeure in the Agreement. Impugned
award ignores the fact that non-political
reasons were excluded from the definition
of force majeure under clause 8.3(c) of the
Agreement.
(15) Impugned award has relied heavily
on alleged heavy rainfall and lorry owners'
strike as a ground to grant bonus based on
force majeure when in fact the said grounds
were not available under the Agreement
and in any case, said grounds were not duly
proved before the Arbitral Tribunal.
(16) Impugned award has erroneously
relied on documents that were disputed by
Plaintiff and the said documents were not
duly proved by way of oral evidence or
otherwise.
(17) Impugned award ignores the fact
that in any case Defendant had not issued
notice as contemplated under Clause 11.5
of the Agreement and in the absence of
mandatory compliance with the provisions
of the Agreement, force majeure could not
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have been applied to the benefit of
Defendant. Once again the impugned award
circumvents the express contractual
provisions and is therefore, patently illegal
and liable to be set aside.
(18) Impugned award virtually amends
the Agreement between the parties by
including nonpolitical events in calculation
of 'X' factor in order to grant benefit to
Defendant. Impugned award ignores the
fact that under clause 18.7 of the
Agreement any amendment would only be
valid if normally executed in writing and
agreed to by all parties. Said provision
stands overridden by the impugned award.
(19) Arbitral Tribunal has failed to
consider that Defendant's claims relating to
calculation of 'X' factor were rejected by the
Project Engineer by letter dated 03.04.2007.
Tribunal in calculating the 'X' factor has
accepted that there is a delay of 97 days
despite Defendant having failed to
satisfactorily establish the same.
(20) Arbitral Tribunal erred in not taking
into account the fact that it was Defendant
that owed Plaintiff amounts as per
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document No.R-9 towards (negative)
variation which was deductible from the
annuity and as such it was the Defendant
that owed Plaintiff moneys towards the
same.
(21) Impugned award has casually relied
on correspondence to create a claim in
favour of Defendant contrary to the
material on record and the express
provisions of the Agreement.
6) Facts, as stated by Plaintiff in AS
No.109/2013, are, Plaintiff is a Department of the
Government of Karnataka, which is responsible for
road works including maintenance on National
Highways, State Highways and major District Roads
and construction and maintenance of Government
Buildings. In addition to the grounds taken by
Plaintiff in AS No.96/2013, award has been
challenged on the following ground :
(1) Impugned award erroneously
upholds the propriety of impleading the
Plaintiff as a party to the arbitration
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proceedings at a belated stage, without due
notice to plaintiff. Tribunal has sought to
rectify the glaring lacuna of 1st Defendant's
case by making Plaintiff a party to the
arbitration when Defendant No.1 had itself
failed to take necessary steps in that regard.
For all these reasons, Plaintiffs pray for
setting aside the award.
7) Defendant No.1 marked appearance through
its counsel and filed its statement of objections
contending that, none of the grounds raised by
Plaintiff would in any manner attract the relevant
provisions of the Arbitration and Conciliation Act,
1996. Grounds raised in the suit are merely on
factual findings, which are beyond the scope of the
appeal provided under Section 34 of the Arbitration
and Conciliation Act, 1996. Plaintiff and 2 nd
Defendant are State entities. They appointed one
arbitrator. On behalf of 1st Defendant, one
Arbitrator was nominated. Two arbitrators
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appointed the Presiding Arbitrator. Impugned award
is unanimous and well reasoned. There is neither
any ambiguity, nor any error in the award. Award
considers all contentions and documents and
judgments put forwarded by the parties. Present
proceedings are not in the nature of an appeal and
the matter ought not be re-appreciated or reheard.
There cannot be any reasons to set aside the
award. Hence, prays for dismissal of the suit.
8) Heard arguments of learned Counsels for
Plaintiffs and Defendant No.1 in both suits. Perused
the common written arguments filed by learned
Counsels for Plaintiffs and Defendant No.1.
9) Points that arise for my consideration are :
(1) Whether Plaintiff has made out
any of the grounds as
enumerated in Section 34 of
the Arbitration and Conciliation
Act, 1996, to set aside the
award?
(2) What Order?
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10) My answer to above points are :
Point No.1 - In the Affirmative;
Point No.2 - As per final order, for
the following :
REASONS
11) Point No.1 : These suits came to be filed
by Plaintiffs, who are Respondents in arbitral
proceedings for setting aside the arbitral award
dated 09.08.2013 passed by Arbitral Tribunal, in
respect of disputes pertaining to work of
construction of 4 lane Bengaluru-Mysuru State
Highway [SH.17], Bengaluru-Maddur package
[Km.11.6 to Km. 45.4, Km. 51.22 to Km. 59.6 and
Km. 62.1 to Km. 82,5], whereby, the Arbitral
Tribunal was pleased to pass award for
Rs.43,30,15,727/- towards Claim Nos.1 to 4 and
Rs.44,86,57,604/- towards interest on Claim No.1 to
4 in favour of Defendant No.1, who is Claimant in
arbitral proceedings and against Plaintiffs.
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12) For the sake of convenience, the parties are
referred to as 'Claimant' and 'Respondents No.1
and 2', as they were referred to in arbitral
proceedings.
13) A tripartite Concession Agreement dated
22.01.2004 [for brevity 'Agreement'] got entered
into between Government of Karnataka,
represented by Principal Secretary, Public Works
Department [Plaintiff in A.S.No.109/2013],
Karnataka Road Development Corporation Limited
[KRDCL] [Plaintiff in A.S.No.96/2013] and
M/s.Brindavan Infrastructure Co. Ltd. [Defendant
No.1 in both suits], for up-gradation of existing 2
lane Bengaluru-Maddur Section of Bangalore-
Mysuru State Highway to 4 lane divided carriage
way. As per Agreement, Claimant agreed to
execute the work in accordance with specifications
by arranging his own finance within a period of 24
months and to maintain project for 8 years
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thereafter. Respondent No.1 agreed to pay annuity
of Rs.29,70,00,000/- on each annuity payment
date. Under Article 8.3(b) of the Agreement, each
annuity payment period was 180 calendar days.
Under Article 8.2(b), Respondent No.1 was under
obligation to provide an irrevocable Letter of Credit
for the sum equivalent to Rs.29,70,00,000/-. Under
Article 8.3(a), a provision was made for Claimant to
receive bonus for early completion of the project or
to incur reduction in the annuity for delayed
completion of the project. Under Article 8.3(c),
bonus or reduction in annuity was agreed to be
computed in accordance with the formula under
Article 8.3(c).
14) In short, Respondents' challenge to arbitral
award is that :
(i) they were unable to present their case
and thereby, principles of natural justice
have been violated;
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(ii) award is contrary to the terms of the
Agreement and same is passed in violation
of substantive law;
(iii) award is in conflict with Public Policy of
India.
15) Learned Counsel of Claimant is pleased to
submit that, Arbitral Tribunal has passed the award
within the purview of Agreement and
correspondences between the parties. Arbitral
Tribunal, having considered all materials placed
before it, has passed a reasoned award, which is
not liable to be interfered with under Section 34 of
the Arbitration and Conciliation Act, 1996. No
grounds have been made out by Respondents to
interfere with the impugned award. Learned
counsel for Claimant is pleased to rely upon ratio
laid down in the case of ASSOCIATE BUILDERS
VS. DELHI DEVELOPMENT AUTHORITY [(2015)
3 SCC 49. Para -33 reads as follows :
" 33. It must clearly be understood that
when a court is applying the "Public Policy"
test to an arbitration award, it does not act
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as a court of appeal and consequently errors
of fact cannot be corrected. A possible view
by the arbitrator on facts has necessarily to
pass muster as the arbitrator is the ultimate
master of the quantity and quality of
evidence to be relied upon when he delivers
his arbitral award. Thus an award based on
little evidence or on evidence which does not
measure up in quality to a trained legal mind
would not be held to be invalid on this score.
Once it is found that the arbitrators
approach is not arbitrary or capricious, then
he is the last word on facts".
16) At the same time, it is also relevant to take
note of Para-15, 16 and 17 of the Judgment supra.
"15. This section in conjunction with Section
5 makes it clear that an arbitration award that
is governed by Part I of the Arbitration and
Conciliation Act, 1996 can be set aside only
on grounds mentioned under Sections 34(2)
and (3), and not otherwise. Section 5 reads
as follows:
" 5. Extent of judicial intervention.-
Notwithstanding anything contained
in any other law for the time being
in force, in matters governed by this
part, no judicial authority shall
intervene except where so provided
in this Part."
16. It is important to note that the 1996 Act
was enacted to replace the 1940 Arbitration
Act in order to provide for an arbitral
procedure which is fair, efficient and capable
of meeting the needs of arbitration; also to
provide that the tribunal gives reasons for an
arbitral award; to ensure that the tribunal
remains within the limits of its jurisdiction;
and to minimize the supervisory roles of
courts in the arbitral process.
17. It will be seen that none of the grounds
contained in sub-section 2(a) of Section 34
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deal with the merits of the decision rendered
by an arbitral award. It is only when we come
to the award being in conflict with the public
policy of India that the merits of an arbitral
award are to be looked into under certain
specified circumstances".
(underlined by me)
17) From the ratio laid down in the Judgment
supra, it has been clear that, merits of arbitral
award can be assailed only when it is in conflict
with the Public Policy of India. Further, it has been
clear that, when a court is applying the 'public
policy' test to an arbitration award, it does not act
as a court of appeal and consequently, errors of fact
cannot be corrected. Having regard to the principles
of law laid down in the Judgment supra, it would be
just and reasonable to assail the contentions of the
parties.
18) First of all, Respondents contend that, after
final arguments were concluded in the arbitral
proceedings, two volumes of documents were filed
by Claimant before the Arbitral Tribunal.
Respondents filed their objections thereto
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contending that said documents are not admissible
and same cannot be relied upon. In the
proceedings dated 01.09.2012, Tribunal recorded
that orders on the application to file additional
documents will be passed along with the main
matter and in the same proceedings, it is recorded
that, the parties agreed that they had been given
full opportunity to be heard.
19) It is further contended that, Respondents, at
no point, countered the additional documents
produced by Claimant on merits. Even though,
admissibility of said documents was objected to by
Respondents, they were not given an opportunity
to counter the said documents on merits. Relied
upon said additional documents, Tribunal gave its
finding that there was a delay in handing over of
site by Respondents and passed award against
Respondents. Respondents were deprived of an
opportunity to defend their case effectively. When
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Tribunal came to finding that documents produced
by Claimant are admissible, it ought to have given
an opportunity to Respondents to meet the
additional documents produced by Claimant.
Hence, impugned award violates the principles of
natural justice and is against the Public Policy of
India.
20) It is contended that, as per Section 34(2)(a)
(iii) of the Arbitration and Concilication Act, 1996,
if the party was unable to present his case, the
arbitral award ought to be set aside. Claimant did
not prove the said documents in a manner known
to law. No evidence was led or witnesses tendered
for cross examination with respect to said
voluminous and disputed documents, which were
produced for the first time after the conclusion of
arguments. Impugned award is, therefore, patently
illegal and liable to be set aside.
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21) On the other hand, Claimant contends that
while arguing on claim in respect of bonus, one of
the aspects touched by Claimant was delay in
delivery of the project site by Respondents. Said
aspect relates to one of the provisions for the
calculation of the 'X' factor in Article 8.3(c)(ii). It is
in that context, the Arbitral Tribunal, during the 16th
& 17th Proceedings dated 5th & 6th January 2012 had
recorded that "the Tribunal during the proceedings
directed the parties to submit a strip plan of the
road showing various hindrances, land acquisition
details which indicate the dates on which the
hindrances were cleared in the respective
reaches". As per direction, same were filed by
Claimant during the hearing on 27.07.2012". S aid
instructions were given to both the parties.
Respondents raised no objection for such a
direction of the Tribunal at that time.
Accordingly, Claimant submitted a 'strip chart'
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in the 19th Proceedings dated 16.03.2012
showing the various hindrances. 'Strip Chart'
produced is diagrammatically identical to the
chart already submitted in the proceedings.
Tribunal gave liberty to Respondents to
examine this aspect and to file their response in
the next meeting. Respondents did not raise any
objection on this matter in the next meeting. Both
the parties were allowed to make oral submissions
on this issue by the Arbitral Tribunal during its 21st
& 22nd sittings of Proceedings held on 27 th & 28th
July' 2012. On conclusion of their respective
submissions, all parties agreed that the orders on
this may be passed in the final Award. Parties also
agreed therein that they had been given full
opportunity to present their case and had nothing
further to add. Thus, the present submission
regarding alleged lack of opportunity is wholly
without basis.
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22) It is contended that, conclusion reached by
the Tribunal on the documents, is that, most of the
documents are documents that originated from
Respondents and were relevant to the delivery of
site. Tribunal also concluded that any other
documents not falling in this category under
volumes C-VI/1 and C-VI/2 were not admissible.
Therefore, Tribunal proceeded to pass an award
based on only those documents, which are in
support of the statement already made available to
the Tribunal in volume C-II/1 and which originated
from Respondents and none else. Hence, there is
no perversity in the recording of the Tribunal while
passing the Award. As per Section 19 of the
Arbitration and Conciliation Act, 1996, Arbitral
Tribunal is not bound by the provisions of the Code
of Civil Procedure, 1908 and that it has power to
determine the admissibility, materiality and weight
of any evidence.
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23) In the backdrop of the rival contentions of
the parties, it is relevant to read findings of the
Arbitral Tribunal. Para-14, 77 and 78 of the award
read thus :
"14. During the 24th sitting the learned
counsel for the Respondent-2 filed his
objections to the application filed by the
Claimant for production of supporting
documents C-VI/1 & C-VI/2. The learned
counsel for the Respondent-1 adopted the
same objection. The parties argued on this
application and agreed that the orders on
this may be passed in the final award.
77. Firstly, addressing the contention of the
Claimant regarding the Volumes C-VI/1 & C-
VI/2 submitted by the Claimant in support of
obstructions and delays and in support of
the documents for calculation of 'X' Factor
needs to be examined. The Respondents
contended that these documents Vol.C-VI/1
& C-VI/2 were furnished at the end of the
arguments and cannot be relied upon by this
Tribunal. The Claimant refuted the
contentions of the Respondents and argued
that the documents contained these
volumes are with respect to; various
hindrances as recorded by the Respondent-2
himself; various Gazette notifications with
respect to land acquisition matters; and
various test reports as contemporaneously
signed by the Project Engineer during the
execution of the work.
78. The AT heard the parties on this matter.
The parties have agreed that orders on this
matter may be passed in the final award.
The Tribunal has examined these documents
in C-VI/1 & C-VI/2. The AT finds that these
documents contain; letters written by the
Respondent-2 in the matter of land
acquisition, documents which are signed by
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the Project Engineer and the Claimant for
recording the test results as a
contemporaneous records & Government of
Karnataka Gazette Notifications and other
correspondences. Therefore the AT finds
that such contemporaneous records
including the Gazette Notifications, letters
addressed by the Respondent to other
Government agencies and their reply cannot
be construed as any self sering documents
and therefore does not deserve to be
rejected. Therefore the Tribunal holds that
these documents pertaining to land
acquisition notification as per the Gazette or
the letters written from the electric utility
services, the letters written by the
Respondent-2 to the land acquisition officer
are to be construed as documents which are
admissible, relevant and material to the
disputes in accordance with Sec. 19(4) of the
Act. Any other documents not falling within
this category under Vol.C-VI/1 & C-VI/2 are
not admissible".
(underlined by me)
24) At this juncture, it is relevant to peruse the
proceedings of the meetings. 16th and 17th sittings
of the Arbitral Tribunal held on 05.01.2012 and
06.01.2012 make it clear that, the Arbitral Tribunal
directed the parties to submit 'strip plan'. Relevant
portion reads thus :
"5. The Tribunal during the proceedings
directed the parties to submit a strip plan of
the road showing various hindrances, land
acquisition details which indicate the dates
on which the hindrances were cleared in the
respective reaches".
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25) Proceedings of 19th sitting held on
16.03.2012 reveal that Claimant submitted a 'strip
plan'. Relevant portion reads thus :
"3. The Claimant submitted a strip chart
showing various hindrances. The Respondent
is given the liberty to examine this and bring
up his response on the same in the next
meeting."
26) Proceedings of 21st and 22nd sittings held on
27.07.2012 and 28.07.2012 disclose that Claimant
filed an application submitting the 'strip chart' and
the documents C6/1 and C6/2 and Respondent
No.2 filed objection and Respondent No.1 adopted
the same. Relevant portion reads thus :
"2. The Claimant filed an application
submitting the strip chart and the documents
C6/1 & C6/2. The Respondent-2 filed an
objection to this and also the filing of strip
chart by the Claimant and the Respondent-1
also adopted the same. Orders on this would
be made by the Tribunal after hearing the
parties in the next sitting".
(underlined by me)
27) Proceedings of 23rd and 24th sittings held on
31.08.2012 and 01.09.2012 go to show that,
Respondent No.2 filed its objections to application
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filed by Claimant for production of documents at
CVI/1 and CVI/2. Respondent No.1 adopted the
same. Further, it discloses that, arguments were
heard on the application for production of
documents and orders on the said application were
agreed to be passed in final award. Relevant
portion reads thus :
"3. The learned Counsel for the Respondent
No.2 filed their objections to the Application
filed by the Claimant for production of
documents No CVI/1 and CVI/2. The Learned
Counsel for Respondent No.1 adopted the
same.
4. The Arguments were made by both the
Counsel on this application and the parties
agreed that the Orders on this may be
passed in the Final Award".
28) From the proceedings recorded by Arbitral
Tribunal and findings of the Tribunal make it clear
that, during 16th and 17th sittings held on
05.01.2012 and 06.01.2012, Arbitral Tribunal
directed the parties to submit the 'strip chart',
accordingly, Claimant submitted 'strip chart'. In
19th sitting held on 16.03.2012, Claimant submitted
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'strip chart' and in 21st and 22nd sittings held on
27.07.2012 and 28.07.2012, Claimant filed an
application submitting the 'strip chart' and
'documents at CVI/1 and CVI/2' and Respondent
No.2 filed its objection and Respondent No.1
adopted the same. Proceedings further go to show
that orders on the said application would be made
by the Tribunal after hearing the parties in the next
sitting. Arbitral Tribunal, in 23rd and 24th sittings
held on 31.08.2012 and 01.09.2012, heard the
arguments on the application for production of
documents and it was recorded that orders will be
passed in the final award as agreed by the parties.
29) Arbitral Tribunal, at the time of passing of the
final award, has come to the specific conclusion
that said documents are admissible, relevant and
material to the disputes and thereby, allowed the
application of Claimant for production of documents
to the extent which the tribunal intended to rely
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upon. When Tribunal has allowed the application of
Claimant holding that the documents produced by
Claimant are admissible, it ought to have given
opportunity to Respondents to meet the said
additional documents on merits. Instead, the
Tribunal, without giving any opportunity to
Respondents to deal with the said documents
produced and relied upon by Claimant, has passed
the final award placing reliance upon said
documents. Reliance of the additional documents at
CVI/2 by the Arbitral Tribunal is apparent from Para-
81 of the award. Para- 81 reads thus :
" 81. There are Gazette Notification in C-VI/2
issued by the Government of Karnataka
regarding notifications under Sec.6(1) of the
Land Acquisition Act. In the notification at
Pg.361 Dt.: 07.08.2005 it is clear that the
4(1) notification in respect of the acquisition
of land itself was Dt.: 24.07.2004. Hence,
we find that the entire Project Site was not
completely handed over even on
22.07.2004, without any hindrances to the
Claimant. The second Gazette notification
under Sec.6(1) of the Land Acquisition Act is
Dt.: 29.12.2005 at Pg.363 of C-VI/2. The 4(1)
notification in respect of the various lands
to be acquired for the Project Site is Dt.:
10.06.2005. There is a third Gazette
notification Dt.: 16.03.2005 at Pg.376 of C-
VI/2. Further there are letters written by the
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Respondent-2 on various dates in C-VI/2;
22.07.2004 Pg.395, 17.02.2005 Pg.397,
06.12.2004 Pg.399, 13.06.2005 Pg.400,
23.11.2004 Pg.401, 26.03.2005 Pg. 403.
These letters addressed to the various land
acquisition authorities, the Deputy
Commissioners and other officers clearly
indicate that unencumbered project Site was
not handed over completely on 22.07.2004".
30) Claimant's contention is that, parties were
instructed to produce 'strip chart'. Said 'strip chart'
is only a diagrammatic representation of what was
exhibited in volume C-II/1. There is no pith and
substance in the contention of the Claimant.
Proceedings dated 27.07.2012 and 28.07.2012
make it abundantly clear that, Claimant filed an
application submitting 'strip chart' and 'documents
at C.VI/1 and C.VI/2'. Moreover, 'documents at
C.VI/1 and C.VI/2' make it clear that, they are the
supporting documents for calculation of 'X' factor
and Arbitral Tribunal, having placed reliance upon
such documents, gave its finding that there was
delay in handing over of site by Respondents, which
led to pass an award against Respondents.
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31) Section 34(2)(a)(iii) of the Arbitration and
Conciliation Act, 1996 provides that, "the party was
otherwise unable to present his case, the award
may be set aside". Section 18 of the Act states that,
"the parties shall be treated with equality and each
party shall be given a full opportunity to present his
case". In Indian Oil Corporation Ltd. V. Raj
Transport Pvt. Ltd. [2009 (8) SCC 520], the
Hon'ble Supreme was pleased to hold that, "Section
18 requires the Arbitrator to treat the parties with
equality (that is to say, without bias) and give each
party full opportunity to present his case". In the
instant case, Arbitral Tribunal, after allowing the
application holding the documents produced by
Claimant are admissible, neither directed the
Claimant to prove the said documents in the
manner known to law, nor evidence was led, nor
witnesses tendered to cross-examination with
respect to said documents. More important is that,
no opportunity was given to Respondents to
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counter the said documents. Arbitral Tribunal simply
relied upon the said additional documents and
passed the award.
32) In Associate Builders' case stated supra,
the Hon'ble Supreme Court was pleased to hold
that, 'audi alteram partem' principle is a
fundamental juristic principle in Indian Law is also
contained in Section 18 and 34(2)(a)(iii) of the
Arbitration and Conciliation Act. In para - 28 and 30,
it is held as follows :
"28. ..... ...... ..... . 38. Equally important and
indeed fundamental to the policy of Indian
law is the principle that a court and so also a
quasi-judicial authority must, while
determining the rights and obligations of
parties before it, do so in accordance with
the principles of natural justice. Besides the
celebrated audi alteram partem rule one of
the facets of the principles of natural justice
is that the court/authority deciding the
matter must apply its mind to the attendant
facts and circumstances while taking a view
one way or the other. Non-application of mind
is a defect that is fatal to any adjudication.
Application of mind is best demonstrated by
disclosure of the mind and disclosure of mind
is best done by recording reasons in support
of the decision which the court or authority is
taking. The requirement that an adjudicatory
authority must apply its mind is, in that view,
so deeply embedded in our jurisprudence
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that it an be described as a fundamental
policy of Indian law.
30. The audi alteram partem principle which
undoubtedly is a fundamental juristic
principle in Indian law is also contained in
Section 18 and 34 (2)(a)(iii) of the Arbitration
and Conciliation Act".
From the award, it is crystal clear that,
opportunity of being heard was denied to
Respondents to meet the additional documents.
33) Next important contention of Respondents is
that, Claimant's claims are severely barred by
limitation. It is contended that, primary dispute
between the parties pertains to fixing of
'commencement date'. According to Respondents,
'commencement date' is 22.04.2004. As per
Claimant, 'commencement date' is 22.07.2004.
Project Engineer gave his decision as to the
'commencement date' as early as 30.10.2014.
Hence, cause of action arose on 30.10.2014,
however, arbitration notice was issued to
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Respondent No.2 only on 18.02.2009 after lapse of
5 years from the date of cause of action.
34) On the other hand, Claimant contends that,
cause for arbitration will only arise where the
settlement process, which is part of the dispute
resolution process fails and therefore, such
reference to arbitration can be made within a
period of three years of failure of the settlement
talks. Arbitral Tribunal has, therefore, rightly
arrived at its conclusion, having regard to the
letters exchanged between the parties and Article
16.1 and 16.2 of the Agreement.
35) In the award, Arbitral Tribunal has held as
follows :
"37. From the above facts and
circumstances we find that the amicable
settlement in accordance with Article-16.1(b)
failed on 30.06.2009. Therefore the cause of
action for the disputes arose only on
30.06.2009. Thus, the commencement date
for limitation had not arisen till 30.06.2009.
Hence, the date of cause of action as per the
Contract to initiate the arbitral proceedings
would be only from 30.06.2009 and
accordingly the commencement of limitation
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period is to be held as commencing from
30.06.2009. As per Sec.43(1) of the Act, the
Limitation Act 1963 will apply to arbitration.
As the cause of action arose on 30.06.2009
there is no bar of limitation for the claims
from 30.06.2009 as per Article-137 of the
Limitation Act. The Arbitral proceedings
commenced on 19.12.2009 well within the
limitation period....."
36) In the light of the contentions of the parties
and findings of the Arbitral Tribunal, it is relevant to
take note of certain correspondences relied upon
by the parties before the Arbitral Tribunal.
37) Project Engineer by his letter dated
30.10.2004 [C-8] informed the Claimant that
22.04.2004 was commencement date and same
was confirmed by Project Engineer by his letter
dated 13.12.2004 [C-9]. Claimant, for the first time
after over a period of year on 09.11.2005 [C-13],
objected to 22.04.2004 being taken as the
commencement date contending that the peaceful
possession of the site was not handed over as on
date. Respondent No.2 by its letter dated
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28.11.2005 [C-14] informed that the site was
handed over within the stipulated time and the
date of financial closure is the date of
commencement. It is relevant to read particular
portions of the letter dated 28.11.2005.
"1. KRDCL has handed over ROW land for a
length of 43.30 Kms on 09.02.2004 vide letter
under reference92). This meets the
requirements of the article 3.1(a) of the
tripartite concessionary agreement executed
on 22.01.2004, as per which 50% of the
project site is required to be handed over
within one month from signing agreement.
2. Since the execution of substitution
agreement are financial closure of the project
was done on 21.04.2004 and as per the
definition of the commencement date, the
later of the, "(a) date of achievement of
financial closure or (b) the date on which the
project site is completely delivered to the
concessionaire in accordance with the
applicable provisions of this agreement" shall
be considered as the commencement date.
4. Further it may also be noted that the
balance length of project site was handed
over within 22nd July 2004, which also satisfies
the agreemental conditions as per Schedule-
E".
38) On 06.02.2006, Claimant wrote a letter
[C-16] to Respondent No.2 to reconsider the
decision regarding 'commencement date' and
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requested to confirm the 'commencement date as
22.07.2004'. Relevant portions of the letter read
thus :
"7. Summarizing the details given in para 4,
6 and 7 above the important dates which
has a say on the commencement date are
as under :
a) finance Close date 22.04.2004
(consulting Engineer Letters dated
30/10/2004 and 13.12.2004)
b) Handing over of 50% of Project site
without encumbrances 04.03.2004
(Executive Engineer's letter dated
30.03.2004)
c) Handing over of complete project site
with encumbrances 22.04.2004 (Executive
Engineers letter dated 22.07.2004)
d) The later date between (a), (b) and (c) is
22.07.2004.
8. As a good will gesture, in order to
finalise the "commencement date" without
any further loss of time, though the
complete site handed over by 22.07.2004
were not in line with Articles 3.1(a) and 6.1
as admitted in the Chief Engineer's letter
dated 06.09.04, the concessionaire accepts
22.07.2004 as the commencement date as
per the interpretation of the definition for
commencement date.
Copy to : The Project Engineer -in
reference to his letter
no.LASA/73143/BM/BICL/017 dated :
24.01.2006 - on the matter of
commencement date and SPCD with a
request to kindly remedy the default and
impact of his letter
no.LASA/73143/BM/BICPL/332 dated
13.12.2004 and M.D/KRDCL's letter dated
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28.11.2005, under the powers vested upon
the Project Engineer by Schedule -L, Section
2.5. The commencement date should be
22.07.04 and not 22.04.04 for reasons
stated in the letter above".
(underlined by me)
39) Respondent No.2, in its letter dated
18.02.2006 [C-17], rejected the request of Claimant
to consider the commencement date as 22.07.2004
and clarified that 22.04.2004 is the
commencement date. Relevant portion reads thus :
"5. Under the circumstances your request of
commencement date as 22.07.2004 cannot
be justified and hence, it is again clarified
that 22.04.2004 is the commencement date.
The independent Project Engineer vide his
letter under ref. 3 & 4, has also declared
22.04.2004 as the commencement date."
40) Despite this, Claimant again wrote a letter
dated 27.02.2006 [C-18] to consider 22.07.2004 as
commencement date. Project Engineer by his
letter dated 11.03.2006 [C-20] declared 22.07.2004
as the commencement date, which Claimant
accepted as 'commencement date'. Relevant
portion of letter dated 11.03.2006 reads thus :
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"5.0 However, having regard to the fact,
that the Concessionaire had also accepted
22.07.2004, as the commencement date
vide his letter dt 6th Feb 2006, it can be
once for all declared that the date
22.07.2004 as the date of commencement
thus foreclosing all avenues for raising this
core issue as a contentious one for any
adjudication at a later date".
41) Project Engineer vide letter dated 25.05.2006 [C-
28], having regard to the letter dated 18.02.2006 of
Respondent No.2, whereunder, the request of Claimant
for considering the commencement date as 22.07.2004
was rejected, once again clarified that 22.04.2004
being the commencement date for all purposes.
Relevant portions of the letter read as follows :
"3. The Concessionaire again requested the
Concessioning Authority vide letter no
BICL/KR/CC/2006/74 dated 6.2.2006 that
date of commencement should be treated as
22.7.2004 but the Concessioning Authority
clarified to the Concessionaire vide letter no
KRDCL/MD/BM Road/2005-06/2609 dated
18.2.2006 that commencement date is
22.4.2004 and accordingly, the request of
the Concessionaire for considering the
commencement date as 22.7.2004 was
rejected by the Concessioning Authority.
In view of the above facts, the
commencement date for the
commencement of project in accordance
with the provisions of Concession Agreement
is being treated as 22.4.2004 for all
purposes and this commencement date of
22.4.2004 shall continue to be treated by us
for assessing/determination of all the
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obligations, requirements and entitlements
of the Concessionaire."
42) Claimant again wrote a letter dated 12.06.2006
[C-31] stating that once the commencement date has
been concluded and declared as 22.07.2004, the
question of reconsidering it, is not supported by
Agreement. Relevant portions read as follows :
"6. From the above it is clear that the
Project Engineer had concluded and declared
that the date of Commencement is
22.07.2004 and foreclosed all avenues for
raising this issue at a later date for
adjudication.
7. Your statement about your having
reconsidered the decision on the
Commencement date in consultation with
the Concessionaire and the Concessioning
Authority is not correct because you have
never consulted us on this matter after your
letter dated 11.03.06. Further, the question
of your reconsidering any decision on this
aspect is not supported by the Concession
Agreement."
43) Project Engineer vide letter dated
04.07.2006 [C-32] reiterated his decision as to the
commencement date being 22.04.2004. Again
Claimant wrote a letter dated 18.07.2006 [C-34]
reiterating the commencement date as 22.07.2004.
Thereafter, a meeting was held on 30.06.2009
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[C-86], in which also, 22.04.2004 has been
reiterated as commencement date. Relevant
portions of the proceedings read thus :
" 3. The main issues were discussed in this
meeting, which are as follows :
Date of commencement
The Concessionaire disputed the
commencement date stating that the second
50% site was handed over to them with
encumbrances and hence to treat
22.07.2004 as the commencement date.
4. KRDCL officials explained that, as per
agreement the commencement date shall be
later of the ;
i) Date of financial close
ii) Date on which the project site is
completely delivered to the concessionaire in
accordance with applicable provisions of this
agreement and
As per schedule 'E' 50% of site to be handed
over within the month of signing the
agreement and balance 50% within 6 months
from agreement date. The date of signing
the agreement is 22.01.2004.
During the meetings held on 12.10.2007 and
31.10.2007 under the Chairmanship of
Principal Secretary, Public Works, Ports & IWT
Department the dispute regarding
commencement date has been rejected and
date 22.04.2004 which is also the date of
Financial closure has been decided as
commencement date.
5. M/s.BICL, the concessionaire clarified that
they had agreed for 22.04.2004 as
commencement date with a hope that
amounts withheld in the annuity payments
would be reimbursed.
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6. Since the arguments of both
concessionaire and Concessioning Authority
were conflicting, the Chairman opined that
no amicable settlement is possible and the
precedence of definition and schedule "E' of
the agreement to be considered as per
agreement clauses and action taken
accordingly by the KRDCL.
9. No amicable settlement is possible and
all the claims are rejected by KRDCL and
same is reiterated in this meeting. Hence as
per Clause 16.2 either party can refer to
arbitration. A panel of 3 may be submitted by
KRDCL for arbitration".
(underlined by me)
44) From the above correspondences, it is clear
that, Project Engineer by his letter dated
30.10.2004, for the first time, informed the
Claimant that 22.04.2004 was the commencement
date. On the other hand, Claimant by its letter
dated 06.02.2006, for the first time, requested the
Project Engineer to consider the commencement
date as 22.07.2004, which was reiterated by
Claimant in its subsequent correspondences. In the
proceedings of the meeting held on 30.06.2009, a
reference was made in respect of the meetings
held on 12.10.2007 and 31.10.2007, whereunder,
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dispute regarding commencement date was
rejected and 22.04.2004 was reiterated as
commencement date, as informed by the Project
Engineer by his letter dated 30.10.2004.
Moreover, in the meeting held on 30.06.2009,
Claimant clarified that he had agreed for
22.04.2004 as commencement date with a hope
that amounts withheld in the annuity payments
would be reimbursed.
45) Respondents contend that Project Engineer
informed his decision as to commencement date by
letter dated 30.10.2004, hence, cause of action
arose on 30.10.2004. On the contrary, Claimant
contends that, commencement date was finally
crystallized on 30.06.2009 in the meeting held on
30.06.2009, hence, cause of action arose on
30.06.2009. Claimant contends that, even if, earlier
letter dated 25.05.2006 and meetings dated
12.10.2007 and 31.10.2007 are taken into
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consideration, its claims are within the period of
limitation.
46) From the contentions of Claimant, it is clear
that, Claimant, in order to bring its claims within
limitation, is adopting convenient and suitable
dates. Claimant does not want to adopt any of the
dates earlier to 25.05.2006. Be that as it may. A
moot question is that, can it be said that
commencement date was finally crystallized in the
meeting held on 30.06.2009 as contended by
Claimant? A meaningful reading of the proceedings
of meeting held on 30.06.2009 make it clear that,
decisions taken in the meetings held on 12.10.2007
and 31.10.2007 have been reiterated in the
meeting dated 30.06.2009. It further makes it clear
that, no amicable settlement was arrived at in the
meeting held on 30.06.2009. Except this, no
decision was taken as to commencement date. It
also makes it clear that decision as to
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commencement date mentioned in meetings dated
12.10.2007 and 31.10.2007 is nothing but
reiteration of decision of Project Engineer, which
was informed to Claimant vide letter dated
30.10.2004. However, Claimant tried to keep alive
the dispute till issue of arbitration notice on
18.02.2009 by it and even after, till 30.06.2009.
Had the Claimant written a letter disputing the
commencement date and requested to hold a
meeting after the meeting dated 30.06.2009, then
also, Claimant's contention would be that, on the
date of letter so written or meeting so held, the
dispute as to commencement date is finally
decided. By writing any number of letters or
holding any number of meetings, the dispute may
be kept alive and in all that situations, it cannot be
invariably said that still there exists a live claim.
47) Learned Counsel for Respondents is pleased
to rely upon the Judgment in the case of State of
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Orissa and Others Vs. Debendranath
Mohapatra [1999 (2) OLR 623], wherein, it is
held that, subsequent exchange of correspondence
between the parties would not arrest the period of
limitation, when there is no specific material on
record indicating that the defendants had
acknowledged their liability in writing so as to
extend the period of limitation as contemplated
under Section 18 of the Limitation Act.
48) Learned Counsel also placed reliance on
M/s.Geo Miller & Co. Pvt. Ltd. V. Chairman,
Rajashthan Vidyut Utpadan Nigam Ltd., vide
Civil Appeal No.967/2010, wherein, the Hon'ble
Supreme Court was pleased to hold that, "the
threshold for determining 'breaking point' in
commercial disputes is lower where the party's
primary interest is in securing the payment due to
them, than in family disputes".
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49) Learned Counsel for Claimant is pleased to
rely on the decision in Harishankar Singhania
and Ors V. Gaur Hari Singhania and Ors. [AIR
2006 SC 2488], wherein, the Hon'ble Supreme
court, having regard to the facts of the case was
pleased to hold that :
" 27. In the instant case correspondence was
not merely in the nature of reminders but
also instruments to resolve the matter and
amicably negotiate. Therefore, when the
negotiations were taking place between the
parties by way of various letters written by
both parties the right to apply can be said to
accrue when it becomes necessary apply,
that is to say when a dispute in fact arose".
50) Also placed reliance of the Judgment in the
case of Madhucon Projects Ltd. V. UE
Development India Pvt. Ltd.
[MANU/AP/0027/2011]. The Hon'ble Andhra
Pradesh High Court, after citing the decisions in the
cases of Hari Shankar Singhania and Shreeram
Mills Ltd., was pleased to hold that, "the right to
apply accrues for seeking reference to arbitration
when the difference or disputes arise between the
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parties i.e. when the claim made by one party is
denied by the other party".
51) In Tamil Nadu Electricity Board Vs.
Kirloskar Constructions and Engineers Limited
and Ors. [2008 940 ARBLR 355 (Madras)], the
Hon'ble Madras High Court, having placed reliance
on Hari Shankar Singhania case, was pleased to
hold that, "the course of correspondence needs to
be noted before reaching a decision on limitation".
52) In Hari Shankar Singhania case, stated
supra, the Hon'ble Supreme Court, having regard to
the family settlement, was pleased to hold that
"the right to apply under section 20 of the
Arbitration Act, 1940 accrued to the appellants only
on the date of the last correspondence between the
parties and the period of limitation commences
from the date of the last communication between
the parties".
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53) In this case, Claimant disputed the
commencement date as 22.04.2004, which was
informed to it by the Project Engineer vide letter
dated 30.10.2004. Dispute as to commencement
date was dragged on by Claimant till 30.06.2009,
even after, the same was intimated to Claimant
vide letter dated 30.10.2004, instead, Claimant
insisted for fixing the commencement date as
22.07.2004. It is to be noted that Claimant issued
arbitration notice under Section 21 of the
Arbitration and Conciliation Act, 1996 for
adjudication of claims claimed in letter dated
05.09.2007. When matter being thus, there is no
substance in the contention of claimant that, the
cause for arbitration will only arise on 30.06.2009
when the settlement process, which is part of the
dispute resolution process, fails. There is no reason
to go for settlement under Article 16.1(a) after
initiation of arbitral proceedings.
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54) Article 16.1(a) of the Agreement states that,
any acts, decision or opinion of the Project Engineer
shall in the first instance be attempted to be
resolved amicably in accordance with the procedure
set-forth in Clause-(b). Clause-(b) states that, on
reference of dispute, the same is not amicably
settled within 15 days, dispute may be referred for
arbitration under Article 16.2. A bare reading of
Article 16.1 makes it clear that, before initiation of
arbitral proceedings regarding the dispute, such
dispute shall be referred to Principal Secretary,
Public Works Department for amicable settlement.
It does not mean that cause for arbitration will only
arise where the settlement process fails. There is no
co-relation between cause of action and settlement
process. Settlement process may take place at any
point of time before initiating arbitral proceedings.
There is no precondition in Article 16.1 to the effect
that only after settlement process fails, cause of
action would arise. If it is held so, same would be
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against the terms of contract. It is important to note
that, once the arbitration notice is issued, there
cannot be any further settlement under Article 16.1
of the Agreement. Claimant has relied on Section 77
of the Arbitration and Conciliation Act, 1996 and
contended that, under Section 77, invocation of the
arbitration clause is very much permissible even
while conciliation proceedings are pending and
therefore, even on this basis, the invocation of
arbitration clause by issuing notice dated
18.02.2009 is perfectly valid. This contention of the
Plaintiff does not hold water. Amicable settlement
process as contemplated in Article 16.1 was not
held under part II of the Arbitration and Conciliation
Act. There is no nexus between amicable
settlement contemplated under Section 16(1) and
Conciliation as contemplated under the Arbitration
and Conciliation Act. Be that as it may.
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55) In the arbitration notice, Claimant specifically
referred to letter dated 05.09.2007, whereunder,
Claimant had referred the disputes for amicable
settlement. When disputes referred to in letter
dated 05.09.2007 were not amicably settled,
claimant issued arbitration notice on 18.02.2009. As
observed above, there is no nexus between cause
of action and amicable settlement. In the meetings
dated 12.10.2007, 31.10.2007 and 30.06.2009,
commencement date, which was notified by the
Project Engineer vide letter dated 30.10.2004 has
been reiterated. Even in letter dated 25.05.2006,
commencement date has been reiterated. Hence, it
is clear that, whenever Claimant raised the dispute
as to commencement date, the same has been
reiterated under various correspondences. Under
such circumstances, it cannot be said that,
commencement date was finally crystallized in the
meetings dated 12.10.2007, 31.10.2007 and
30.06.2009 and by the letter dated 25.05.2006.
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56) In this background, having taken into
consideration of the letter dated 30.10.2004,
Claimant ought to have initiated arbitral
proceedings on or before 30.10.2007. During that
period, Claimant could have also referred the
dispute for amicable settlement. Even Claimant had
referred the disputes for amicable settlement vide
letter dated 05.09.2007, during the said period.
However, Claimant initiated arbitral proceedings
only on 18.02.2009, the date on which arbitration
notice under Section 21 of the Arbitration and
Conciliation Act, 1998 was issued.
57) Assuming that commencement date is
22.07.2004 as contended by Claimant vide letter
dated 06.02.2006, the cause of action to initiate
arbitral proceedings arose even prior to 30.10.2004
and in that situation, Claimant ought to have
initiated arbitral proceedings on or before
22.07.2007. If the letter dated 06.02.2006 is taken
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into consideration, in which, Claimant contended
the commencement date as 22.07.2004, Claimant
ought to have initiated arbitral proceedings on or
before 06.02.2009. Having considered all these
aspects of the matter, at any stretch of imagination,
it cannot be said that Claimant's claims remain
within limitation.
58) Respondents contend that, right to sue
accrues to Claimant on 30.10.2004 and claimant
ought to have initiated arbitral proceedings within
three years when right to sue first accrues, as
contemplated under Article 58 of the Limitation Act.
Claimant contends that period of limitation is three
years when the right to sue accrues under Article
137 of the Limitation Act. Schedule to Limitation Act
deals with period of limitation. First Division of Part-
III deals with suits relating to declarations. Article
58 reads as follows :
58. To obtain any other Three years When the right to sue
declaration first accrues.
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59) Part-X deals with suits for which there is no
prescribed period of limitation. Article 113 reads as
follows :
113. Any suit for Three years When the right to sue
which no period of accrues.
limitation is provided
elsewhere in this
Schedule.
60) Division III of Part II deals with other
applications. Article 137 reads as follows :
137. Any other Three years When the right to
application for which apply accrues.
no period of limitation
is provided elsewhere
in this division
61) Article 58 states that, to obtain any other
declaration, the period of limitation is three years
when 'right to sue first accrues'. Article 113
prescribes that any suit for which no period of
limitation is provided elsewhere in the schedule, the
period of limitation is three years when 'right to sue
accrues'. Article 137 states that any other
applications for which no period of limitation is
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provided elsewhere in the schedule, the period of
limitation is three years, when the 'right to apply
accrues'.
62) Article 137 has to be looked into in the
context of facts stated in Hari Shankar Singhania
case, wherein, it has been specifically held that :
"9. It is now well settled that Article 137 of
the Limitation Act, 1963 applies to an
application under Section 20 of the
Arbitration Act, 1940. Accordingly, an
application under Section 20 of the Act for
filing the arbitration agreement in Court and
for reference of disputes to arbitration in
accordance therewith is required to be filed
within a period of three years when the right
to apply accrues. The right to apply accrues
when difference or dispute arises between
the parties to the arbitration agreement. In
the facts of the case, it is therefore necessary
to find out as to when the right to apply
accrued."
63) Hence, the question of applying Article 137 of
the Limitation Act to instant case does not arise,
which is aptly applicable to other applications.
Relevant Articles that have to be considered are
Article 58 and Article 113. Both are residuary
Articles. When no period of limitation is provided
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elsewhere in the schedule for the suit, then only
Article 113 can be made applicable. However,
Claimant's claim in claim petition is in the nature of
declaration simplicitor. Under such circumstances,
applicable Article is, Article 58. Article 58 states
that, to obtain any other declaration, the period of
limitation is three years, when right to sue 'first
accrues'. Right to sue first accrues to Claimant on
30.10.2004 and under such circumstances,
Claimant ought to have initiated arbitration
proceedings on or before 30.10.2007. The Hon'ble
Supreme Court in Panchu Gopal Bose V/s Board
of Trustees for Port of Calcutta [AIR 1994 SC
1615] was pleased to hold that "The period of
limitation for the commencement of an arbitration
runs from the date, on which, had there been no
arbitration clause, the cause of action would have
accrued, just as in the cause of actions the claim is
not brought after the expiration of a specified
number of years from the date on which the cause
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of action accrued, so in the case of arbitrations, the
claim is not to be put forward after the expiration of
the specified number of years from the date when
the claim accrued".
64) Findings of the Arbitral Tribunal in respect of
cause of action is as follows :
"37. From the above facts and
circumstances we find that the amicable
settlement in accordance with Article-16.1(b)
failed on 30.06.2009. Therefore the cause of
action for the disputes arose only on
30.06.2009. Thus, the commencement date
for limitation had not arisen till 30.06.2009.
Hence, the date of cause of action as per the
Contract to initiate the arbitral proceedings
would be only from 30.06.2009 and
accordingly the commencement of limitation
period is to be held as commencing from
30.06.2009. As per Sec.43(1) of the Act, the
Limitation Act 1963 will apply to arbitration.
As the cause of action arose on 30.06.2009
there is no bar of limitation for the claims
from 30.06.2009 as per Article-137 of the
Limitation Act. The Arbitral proceedings
commenced on 19.12.2009 well within the
limitation period....."
65) Arbitral Tribunal has held that, "date of
cause of action as per the contract to initiate
arbitral proceedings would be only from
30.06.2009 as the amicable settlement in
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accordance with Article 16.1(b) failed". As
observed above, there is no co-relation between
limitation and settlement process. Wrong
interpretation of Article 16.1(b) and over
concentrating the proceedings of meeting dated
30.06.2009 make the Arbitral Tribunal to hold that
cause of action arose to Claimant only on
30.06.2009. There is no reason for Arbitral Tribunal
to harp upon the proceedings of the meeting dated
30.06.2009, when the arbitral notice had already
been issued on 18.02.2009 for initiation of arbitral
proceedings. Section 43(2) of the Arbitration and
Conciliation Act, 1996 specifically states that,
arbitration shall be deemed to have been
commenced on the date referred to in Section 21 of
the Act. Hence, arbitration proceedings shall be
deemed to have been commenced by Claimant on
18.02.2009. When matter being thus, there is no
reason for Arbitral Tribunal to hold that cause of
action arose to Claimant to initiate arbitral
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proceedings on 30.06.2009. Relying the
proceedings of the meeting dated 30.06.2009 by
the Arbitral Tribunal is wholly irrelevant and same is
patently illegal.
66) It is contended that, Respondent No.1
received claim statement only in December 2010.
So far as, Respondent No.1 is concerned, the
arbitration commenced only in December 2010 and
therefore, Claimant's claims against Respondent
No.1 are barred by time. It is contended that, where
no arbitration notice has been issued, then, the
date on which the pleading is filed before the
Arbitrator shall be deemed to be the date when
arbitration commences.
67) Claimant contends that, the proceeding of
the meeting dated 30.06.2009 reflects decision of
Respondent No.1 and same would be the relevant
date for initiation of arbitral proceedings against
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Respondent No.1. It is contended that, even if the
earlier meetings held on 12.10.2007 and
31.10.2007 are taken into consideration, are
relevant dates to consider the point of limitation in
respect of the claims against Respondent No.1. It is
contended that, the date when amicable
settlement failed would be considered as relevant
date to go to arbitration.
68) It is to be noted that award has been passed
in favour of Claimant against both Respondents. As
per award, both Respondents are equally liable to
pay the award amount. Most important is that,
Respondent No.1 was not added as a proper party.
Under such circumstances, there is no justification
in adding Respondent No.1 in the arbitral
proceedings without giving arbitration notice as
contemplated under Section 21 of the Act. Section
21 mandates that arbitration proceedings in
respect of the dispute commenced on the date on
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which a request for that dispute to be referred to
arbitration, is received by Respondent. However, in
the instant case, arbitration notice was issued to
Respondent No.2 only. No request was made to
Respondent No.1 for arbitration and under such
circumstances, receiving of arbitration notice by
Respondent No.1 does not arise. When there is no
request for arbitration, there shall be no arbitration
of dispute against the party to whom no notice of
arbitration has been issued. Without making
request to arbitration under Section 21 of the Act,
Claimant made a claim against Respondent No.1
and Arbitral Tribunal passed the award against
Respondent No.1 without taking into consideration
of mandatory provision as contained in Section 21
of the Arbitration and Conciliation Act.
69) It is contended that Respondent No.1
received claim statement in December, 2010.
Assuming that claim statement received by
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Respondent No.1 is considered as request for
arbitration, Claimant's claim against Respondent
No.1 is barred by limitation, since cause of action
arose on 30.10.2004. At the time of receiving claim
statement there was no live claim either against
Respondent No.1 or against Respondent 2.
70) In the award, it is held that Respondent No.2
has waived its contention of limitation. Para-32 of
the award reads thus :
"32. The AT heard the parties and perused
the various documents. As the Respondent-
2 has requested for waivel of his plea
regarding limitation during arguments and
the same is permitted and the AT holds that
there is no bar of limitation for the claims as
against Respondent-2".
71) In the light of observation of the Arbitral
Tribunal, it is relevant to mention Section 3 of the
Limitation Act, 1963. Section 3(1) reads as follows :
"3. Bar of Limitation.- (1) Subject to the
provisions contained in sections 4 to 24
(inclusive), every suit instituted, appeal
preferred, and application made after the
prescribed period shall be dismissed,
although limitation has not been set up as a
defence".
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72) Section 3(1) makes it clear that, it is
mandatory for the court to dismiss the claim made
after the prescribed period of limitation although
limitation has not been set up as a defence. Party
cannot waive defence of limitation. In Vijay
Narayan Thatte and Others v. State of
Maharashtra and Others, [(2009)9 SCC 92], the
Hon'ble Supreme Court was pleased to hold that :
"21. In our opinion, there can be no
estoppel against a Statute. Since the statute
is very clear, the period of limitation provided
in Clause (ii) of the proviso to section 6 of the
Act has to be followed, and concessions of
the counsel can have no effect. As already
stated above, the proviso is mandatory in
nature, and must operate with its full rigour
vide Ashok Kumar V. State of Haryana (2007)
3 SCC 470 (para 17)".
73) In Foreshore Cooperative Housing
Society Ltd. V. Praveen D.Desai and Ors.
[(2015) 6 SCC 412], the Hon'ble Supreme Court
was pleased to hold that :
"47. It is well settled that essentially the
jurisdiction is an authority to decide a given
case one way or the other. Further, even
though no party has raised objection with
regard to jurisdiction of the court, the court
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has power to determine its own jurisdiction.
In other words, in a case where the Court has
no jurisdiction; it cannot confer upon it by
consent or waiver of the parties".
74) Hence, it has been clear that, it is the
bounden duty of the Court to decide that whether
claim made before it, is barred by limitation or not
irrespective of the contentions of the parties.
Consent of the parties does not come in the way of
deciding the issue of limitation and same does not
confer or take away the power of Court to decide its
jurisdiction.
75) 'Force Majeure Events' : Claimant
contends that, there was obstruction of work due to
'force majeure' events being rains, flooding and lorry
strike and it made a claim for Rs.12,54,00,0000/-
under Article 8.3 of the Contract as a bonus.
76) Respondents contend that provisions of
contract clearly prohibit bonus from being given in
cases where the performance under the contract is
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prevented by floods or strikes. It is relevant to take
note of Articles 8 and 11 of the Agreement.
"11.1 Force Majeure Events
As used in this Agreement, Force
Majeure Event means any of the Non-Political
Events, the Political Events or Other Events
set out in sub-articles 11.2, 11.3 and 11.4
respectively including the
impact/consequence thereof which :
...............
11.2 Non-Political Events :
Any of the following events which
prevents the Affected party from performing
any of its obligations for a continuous period
of not less than 7 days from the date of its
occurrence, shall constitute a Non-Political
Event :
(a) earthquake, flood, inundation,
landslide;
(b) xxx xxx
(c) xxx xxx
(d) xxx xxx
(e) strikes, boycotts, labour disruptions or
any other industrial disturbances not
arising on account of the acts or
omissions of the Concessionaire or the
Contractor and,
(f) xx xx xx"
11.4 Other Events
.........
"8.3 Bonus/Reduction in Annuity
(a) The Concessionaire shall either
receive bonus for early completion of
the Project (the "Bonus") or incur
reduction in the Annuity for delayed
completion of the Project (the
"Reduction") as the case may be.
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(c) The Bonus or Reduction as the case
may be shall be computed as under :
(i) xxx xxx
(ii) xxx xxx
'X' =As determined by
the Project Engineer, the aggregate
number of days of delay caused by ;
(i) xxx xxx
(ii) xxx xxx
(iii) xxx xxx
(iv) xxx xxx
(v) Force Majeure Event
which is a Political Event
or Other Event".
77) Above terms of contract make it clear that,
while determining the 'X' factor, only Political event
or other event can be considered. Flood and strikes
squarely come under clause (a) and clause (e) of
Article 11.2, which are non-political events.
Findings of the Arbitral Tribunal are as follows :
154. Based on the above facts and
circumstances and the legal propositions we
find that there is an express agreement
between the parties in the definitions of Force
Majeure events under Article-11 as
reproduced earlier. The two Force Majeure
events Viz.; Flood and inundation under
Article-11.2(a) and the Truck Strike under
Article-11.2(e) are squarely covered under the
express terms of contract that they are non-
political evients of Force Majeure Events, in
the definition of 'X' factor, reproduced earlier,
to determine the total aggregate number of
days of delays caused by Force Majeure event.
It is expressly agreed that Force Majeure
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event which is 'a Political Event or other event'
is to be considered for determining the 'X'
factor. Force Majeure Events under
article11.2(a) & 11.2(e) are squarely covered
under the head non-political events. ........."
160. In fact we find under Article-8.3(c)
Sl.No.(v) under the determination of 'X' factor
what is stated is 'Force Majeure Event which is
a Political Event of Other Event'. From plain
reading of this clause it lends to a construction
that only one Force Majeure Event Viz.;
Political Event or Other Event is to be
considered in determination of 'X' factor. We
find that such reading of the clause without
taking into the various provisions of the
Contract and the facts & Law is not justified.
Therefore the provision under this article has
to be interpreted, taking into consideration
the other provisions of the Contract and the
conduct of the parties."
78) Arbitral Tribunal based on Minutes of the
Meeting dated 11.10.2006 has considered flood
and strikes in determining the 'X' factor. There
exists a finding in the award that flood and strikes
are non-political events, even though, Arbitral
Tribunal considered the same while determining the
'X' factor disregarding the terms of contract.
79) Section 28(3) of the Arbitration and
Conciliation Act, 1996 specifically states that, "in
all cases, the arbitral tribunal shall decide in
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accordance with the terms of the contract and shall
take into account the usages of the trade
applicable to the transaction".
80) Moreover, sanctity of Agreement executed
by the State has been enshrined in Article 299(1) of
the Constitution of India. It reads thus :
" (1) All contracts made in the exercise of
the executive power of the Union or of a
State shall be expressed to be made by the
President, or by the Governor of the State,
as the case may be, and all such contracts
and all assurances of property made in the
exercise of that power shall be executed on
behalf of the President or the Governor by
such persons and in such manner as he may
direct or authorise".
81) In the instant case, Agreement dated
22.01.2004 has been executed by Principal
Secretary, PWD on behalf of Governor of Karnataka.
In the Minutes of Meeting dated 11.10.2006, it is
resolved that Claimant's requests for considering
flood and strikes in determining the 'X' factor are to
be taken into consideration. Said Meeting was held
by Managing Director of Respondent No.2. It is no
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where stated in the Minutes of Meeting that, flood
and strikes are being considered as political or
other events. Further, there is no mention that
parties have come to mutual understanding that
the terms of contract are modified so as to consider
the flood and strikes as political or other events or
that the minutes of the meeting shall be read as
part and parcel of the contract. Under such
circumstances, Minutes of Meeting cannot be taken
into consideration in derogation of contract
executed on behalf of the Governor of the State.
Article 18.7 of the Agreement specifically states
that, "This Agreement and the Schedules together
constitute a complete and exclusive understanding
of the terms of the Agreement between the Parties
on the subject hereof and no amendment or
modification hereto shall be valid and effective
unless agreed to by all the parties hereto and
evidenced in writing". From Article 18.7, it is
crystal clear that, no amendment or modification
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shall be valid and effective unless agreed by all the
parties to the Agreement and evidence in writing.
Minutes of Meeting, dated 11.10.2006 specifically
disclose that it was held for discussing about
variation statement prepared by Project Engineer
resulting in change of scope, cannot be construed
as meeting convened by the parties to the
Agreement for amendment or modification of the
Agreement. When terms of contract are
unambiguous and plain, same do not invite for
interpretation. In the Agreement, it has been
clearly stated that, what are political events, what
are non-political events and other events. It has
been specifically stated that, flood and strikes are
non-political events and even Arbitral Tribunal has
held so. Under such circumstances, there is no
reason to place the events like flood and strikes in
political and other events against the terms of
contract in determining the 'X' factor. Had the
terms of contract were silent about which are
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political events, which are non-political events or
other events, then, interpretation of terms of
contract would be justifiable and under such
circumstances, it would be permissible to consider
the Minutes of the Meeting.
82) In Joshi Technologies Inc V. Union of
India and others [(2015) 7 SCC 728], the
Hon'ble Supreme Court was pleased to hold that,
"We have to keep in mind that the contract in
question is governed by the provisions of Article
299 of the Constitution. These are formal contracts
made in the exercise of the Executive power of the
Union (or of a State, as the case may be) and are
made on behalf of the President (or by the
Governor, as the case may be). Further, these
contracts are to be made by such persons and in
such a manner as the President or the Governor
may direct or authorize. Thus, when a particular
contract is entered into, its novation has to be on
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fulfillment of all procedural requirements...".
Hence, it has been clear that, unless fulfillment of
all procedural requirements, nothing can be added
to or subtracted from the solemn contract. When
fact being thus, Arbitral Tribunal has taken the task
of interpreting the contract against the terms of
contract and in violation of Section 28(3) of the
Arbitration and Conciliation Act, 1996.
83) In Associate Builders case, stated supra, it
is held that, the fourth head of public policy is
'patent illegality'. It is held that, award passed in
contravention of substantive law of India and the
terms of contract, same would amount to patent
illegality. It is further held that:
"The juristic principle of Wednesbury
reasonableness is that a decision which is
perverse or so irrational that no reasonable
person would have arrived at the same is
important and requires some degree of
explanation.
It is settled law that where :
(i) a finding is based on no
evidence, or
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(ii) an Arbittral tribunal takes
into account something
irrelevant to the decision which it
arrives at; or
(iii) ignores vital evidence in
arriving at its decision, such
decision would necessarily be
perverse".
84) At this juncture, it is necessary to mention
the claim made by Claimant and the claim awarded
by the Arbitral Tribunal. It is as follows :
" Claimant's claims before the Arbitral Tribunal are as
follows :
Claim No. Details of Claim Claimed Amount
Claim -1 Effect due to change in Rs.11,55,00,000/-
commencement date
Claim-2 Payment of Bonus under Sub-
Article 8.3.c(i)
a) Due to delay in delivery of Rs.19,47,00,000/-
project Site/ Concessioning
Authority's even of default
b) Due to change of Scope Rs. 49,50,000/-
c) Due to Adverse Effects of Rs.12,54,00,000/-
Force Majeure events.
Claim -3 Change of Scope Rs. 85,56,215/-
Claim -4 Arbitrary recoveries made from Rs. 6,99,78,603/-
Annuity payments
Claim -5 Interest from the date they are Rs.29,00,68,860/-
due @ SBIPLR + 3% p.a
compounded upto 31.12.2009
TOTAL Rs.80,91,53,678/-
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Award in respect of above claims is as follows :
Claim Details of Claim Awarded Amount Interest
No.
Claim -1 Effect due to change Rs.11,55,00,000/- Rs.11,69,46,124/-
in commencement
date
Claim-2 Payment of Bonus
under Sub-Article
8.3.c(i)
a) Due to delay in
delivery of project Rs.19,47,00,000/- Rs.20,53,79,162/-
Site/ Concessioning
Authority's even of
default
b) Due to change of Rs. 49,50,000/- Rs. 52,21,504/-
Scope
c) Due to Adverse Rs.12,54,00,000/- Rs. 7,13,60,556/-
Effects of Force
Majeure events.
Claim -3 Change of Scope Rs. 85,56,215/- Rs. 90,25,518/-
Claim -4 Arbitrary recoveries Rs. 4,16,58,512/- Rs. 4,07,24,741/-
made from Annuity
payments
Total = Rs.43,30,15,727/- Rs.44,86,57,604/-
85) It is to be noted that, Respondent No.1
agreed and undertook to pay to Claimant the sum
of Rs.29,70,00,000/- as annuity. It is not in dispute
that said amount has been paid to Claimant.
Despite this, Claimant made a claim of
Rs.80,91,53,678/- towards bonus for early
completion of work, effect due to change in
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commencement date, recoveries made from
annuity and interest. Arbitral Tribunal awarded a
sum of Rs.88,16,73,331/-. First of all, Claimant
claimed a sum of Rs.80,91,53,678/-, instead,
Arbitral Tribunal awarded a sum of
Rs.88,16,73,331/-. If the amount awarded is taken
into consideration, for the work of
Rs.29,70,00,000/-, Claimant has been awarded
117,86,73,339/-. It is a great bonanza to Claimant
from the exchequer of the State and at the same
time, it certainly, shocks the conscience of the
Court.
86) In Associate Builders case, stated supra,
the Hon'ble Supreme Court was pleased to hold
that, the third ground of public policy is, if an award
is against justice or morality. Award can be said to
be against justice only when it shocks the
conscience of the court.
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87) In Gopal Chandra Mukherjee Vs. Food
Corporation of India [MANU/WB/1488/2017],
decided on 12.01.2017, the Hon'ble Supreme Court
was pleased to hold as follows :
25. Ordinarily, courts in this country may
scarcely distinguish between one Party and
another based on its status as to whether it is a
State or an Instrumentality of the State within
the meaning of Article 12 of the Constitution.
But when it comes to squandering public
money or defrauding public exchequer, as has
been attempted by this appellant, courts have
a bounden duty under our Constitutional
scheme to arrest the mischief. It would be
opposed to the public Policy of India to allow
public funds to be plundered or squandered. It
would also be patently illegal, going to the very
root of the matter, to read a clause in a dead
and spent agreement to imply that the
obligation of retaining rotten food grain would
continue and infinitum. In a matter of the
present kind it is the obligation of the court to
sift through the maze of legal hurdles that the
disingenuous may present to strike at the root
and uproot the mischief."
88) Having considered all these aspects of the
matter, this Court holds that, award is patently
illegal and same has been passed in contravention
of Public Policy of India. Such illegality in passing
the award goes to the root of the matter. In that
AS.96/2013
C/w
AS.109/2013
82
view of the matter, it has to be said that, view
expressed by the Arbitral Tribunal in the award is
not a possible view and therefore, same needs to
be set aside; accordingly, I answer the above point
in the affirmative.
89) Point No.2 : In view of the foregoing
discussion and answer to Point No.1, I proceed to
pass the following :
ORDER
(1) Suits in AS.No.96/2013 and AS.No.109/2013 filed under Section 34 of the Arbitration and Conciliation Act, 1996, are hereby allowed.
(2) Award dated 09.08.2013 passed by Defendants No.3 to 5/Arbitral Tribunal; is hereby set aside.
AS.96/2013 C/w AS.109/2013 83 (3) Keep the Original of this judgment in AS.No.96/2013 and copy in AS.No.109/2013.
[Dictated to the Judgment Writer, transcribed and computerized by her, transcript thereof corrected and then pronounced by me in open court, on this the 8th day of June, 2020.] [RAMA NAIK] VI Addl.City Civil & Sessions Judge, Bengaluru City