Bombay High Court
Oil And Natural Gas Corporation Ltd. vs Newton Engineering And Chemicals ... on 17 October, 2025
Author: R.I. Chagla
Bench: R.I. Chagla
2025:BHC-OS:19596
J-CARBP 648.2021.doc
Kavita S.J.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
COMMERCIAL ARBITRATION PETITION NO.648 OF 2021
Oil and Natural Gas Corporation Ltd., ...Petitioner
Versus
Newton Engineering and Chemicals Ltd., ...Respondent
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Mr. Vishal Kanade a/w Mr. Virendra Pereira, Mr. Anagh Pradhan,
Ms. Aneesha Munshi, Mr. Anand Iyer, M.s Niyati Dasondi and Ms.
Palak Jain i/b Divya Shah Associates for the Petitioner.
Mr. Mayur Khandeparkar a/w Mr. Bernando Reis i/b Dr. Prem S.
Motiramani for the Respondent.
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CORAM : R.I. CHAGLA, J.
RESERVED ON : 22nd APRIL, 2025.
PRONOUNCED ON : 17th OCTOBER, 2025.
JUDGMENT :
1. By this Commercial Arbitration Petition, the Petitioner has impugned the Award dated 26th August, 2021 passed by the Arbitral Tribunal. By the impugned Award the Arbitral Tribunal has KAVITA directed the Petitioner to pay an aggregate amount of SUSHIL JADHAV Digitally signed Rs.27,43,69,720/- alongwith interest @ 12% per annum as well as by KAVITA SUSHIL JADHAV Date: 2025.10.17 17:16:35 +0530 costs as mentioned in the impugned Award. 1/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
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2. It is pertinent to note that by an Order dated 17 th April 2023, the present commercial Arbitration Petition had been admitted by this Court and execution of the impugned Award was stayed subject to deposit of the said amount. The Petitioner has deposited an amount of Rs.41,12,17,356/- with the learned Prothonotary and Senior Master of this Court on 25th May 2023, within the time stipulated by the said order.
3. A brief background of facts is necessary and which are as under:
(i) A Tender was floated for Modernization of the Effluent Treatment Plant ("ETP") at Uran Plant of Petitioner. The scope of work, which the successful bidder was required to inter-alia carry out included :
i. Process design, basic engineering, detailed engineering, manufacture, fabrication, supply, total procurement of all the Items including construction materials as defined in the special condition of the bid;
ii. demolition of existing surge pond and other 2/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc units;
iii. revamp of existing units as indicated in the bid;
iv. construction, erection, and installation, air- conditioning, ventilation, testing, painting, lining, insulation, commissioning and guaranteeing the entire modernization of ETP on turnkey basis to meet the treated effluent quality;
v. remove debris and sludge from the surge
pond.
(ii) A Pre-Bid Meeting was held on 10th January,
2014. Clarification was issued by the Petitioner that M/s Mumbai Waste Management Limited ("MWML") Taloja was the approved party for sludge disposal and bidders may fix a Contract with them.
(iii) On 6th May 2014, an Agreement and Memorandum of Understanding ("MoU") was executed between the Respondent and M/s UEM India Pvt. Ltd. 3/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
J-CARBP 648.2021.doc ("UEM"). As per Technical Collaboration Agreement between the Respondent and UEM, UEM was primarily responsible for basic design and engineering, detailed engineering, technical collaboration assistance / services, critical equipment supplies and expert supervision.
(iv) The Bid of the Respondent was submitted on 7th July, 2014. The Respondent's bid qualified for consideration. It is the Petitioner's claim that this was only because UEM was the Respondent's technical collaborator for execution of the project. The bid of the Respondent was accordingly reviewed considering the fact that UEM was meeting the criteria given in the tender document.
(v) A Letter of Award ("LOA") was issued by Petitioner to Respondent. The Petitioner claims that based on the submission of technical collaboration agreement with UEM, the Respondent's Bid was technically accepted and the Respondent was awarded the Contract.
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(vi) Pursuant to the Respondent having been awarded the Contract, a letter dated 1 st August, 2015 was addressed by the Respondent to Midland Oil Corporation Limited ("MOCL") accepting their offer for disposal of sludge from Surge Pond B @ Rs. 4000 per MT
- Sludge in Surge Pond A which was to be released only after Pond B equipment's were erected and commissioned and which may be commissioned after 8 months after Pond B is cleaned and handed over.
(vii) The Respondent for the first time on 29 th February, 2016 informed the Petitioner about the Contract with MOCL for recycling and safe disposal of sludge from surge pond B.
(viii) The Petitioner by letter dated 3rd March 2016, brought to the notice of the Respondent that in respect of sludge removal it was clarified in the pre-bid reply that "M/s. MWML, Taloja" was the only agency through whom the sludge could be disposed of in view of the MPCB consent granted to the Petitioner.
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(ix) The Petitioner by Letter dated 23 rd March 2016, informed the Respondent that MWML Taloja was approved by CPCB / MPCB for handling/disposal of sludge and the bidder was to fix Contract and disposal of sludge through that agency. It was mentioned that MOCL was not the authorized agency to dispose of sludge and that the consent available with MOCL was for waste oil and not sludge.
(x) On 29th March 2016, a detailed Contract Agreement was executed between the Petitioner and the Respondent.
(xi) A Letter dated 16th April, 2016 was addressed by the Respondent to the Petitioner pointing out that they were not bound to send the sludge to MWML - Taloja and that the pre-bid queries only suggested that they may approach them. It was pointed out that since sludge analysis was pending processing from MPCB Laboratory, the Respondent cannot proceed further and hence, delay for sludge disposal as recorded in Weekly Review Meetings (WRMs) was not due to 6/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Respondent.
(xii) A letter dated 21st April, 2016 was addressed by the Respondent to the Petitioner once again pointing out that sludge in Surge Pond could be processed by MPCB Authorized Reprocessor and the remaining sludge would be disposed off by incineration facility at any MPCB approved agency and requested for permission for the same.
(xiii) The Petitioner recorded by Letter dated 11 th July, 2016 that the Management Review Meeting to be held on 8th July, 2016 was constrained to be rescheduled since the Respondent's MD did not attend the meeting. The meeting was of grave importance since the important issues of sludge disposal and project progress were to be discussed.
(xiv) The MPCB on 7th September, 2016 directed the Petitioner to carry out sludge testing and accordingly, the Laboratory Report of Sludge Analysis was submitted by MWML, Taloja. The report established that almost 7/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc 30% of the contents of surge pond B consisted of hydro carbons i.e. crude oil and not waste oil.
(xv) A letter was addressed by the Petitioner on 9th November, 2016 to the Respondent that since the progress of the Respondent's execution of the subject Contract project was only 0.71% as against the scheduled target of 26.20% as on 9 th November 2016, it was abnormally low.
(xvi) The Petitioner once again by a letter dated 29th December, 2016 recorded that the progress of the project was only 0.72% against the schedule of 33.99% as on the date of the letter, which was abnormally low. (xvii) The Petitioner by a letter dated 13th February, 2016 recorded that the progress achieved by the Respondent upto 13th February, 2017 was highly unsatisfactorily to the extent of only 1.62% as against the scheduled progress of 59.42%.
(xviii) The Respondent through its letter dated 11 th March, 2017 stated that there were commercial issues 8/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc between the Respondent and UEM which were unresolved inspite of meetings held between UEM and the Respondent.
(xix) The Petitioner by a letter dated 15 th March, 2017 recorded that the project progress was only 1.8% against the schedule of 68.15%.
(xx) The Petitioner by a letter dated 31st March, 2017 recorded that the progress of the project is 2.01% against the schedule of 68.70% which was highly unsatisfactory and the Respondent was called upon to improve the performance forthwith.
(xxi) The Respondent by its letter dated 13th April, 2017 informed the Petitioner that the Project has slowed down because of the Sludge disposal issue.
(xxii) The Respondent by a letter dated 8 th May, 2017 informed the Petitioner about its progress with UEM. The Respondent accepted that there were agreed terms between them and UEM. The Respondent further admitted that there was delay in the start of the Project 9/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc as the issue pertaining to sludge was resolved only in November, 2016.
(xxiii) The Petitioner issued Notice of Termination dated 9th May, 2017 to the Respondent, notifying the Respondent to complete the minimum actions on design and engineering, procurement and construction activities within period of 30 days of the notice, as particularly set out therein.
(xxiv) A detailed letter dated 29th May, 2017 was addressed by the Respondent to the Petitioner pointing out all the difficulties faced by the Respondent in the execution of the Contract and the work done by them together with various documents annexed. The Respondent reiterated that the delay in execution of the project was due to the sludge issue. Due to delay in project the Respondent had invested huge sums in the project from its own pocket due to which the Respondent ran out of funds and couldn't pay their technology back up partners. The Respondent had paid more than 80 lakhs to UEM even though they had not been paid by the 10/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Petitioner. UEM was the technical collaborator but any Contractual liability would be on the Respondent. It was further informed to the Petitioner by the said letter that the commercial dispute with UEM had been resolved. (xxv) The Respondent addressed a Reply dated 3rd June, 2017 to the Termination Notice of the Petitioner, wherein it was claimed that the Respondent has submitted large number of engineering documents to the Petitioner. The Respondent also informed the Petitioner that some documents were simultaneously also pending for review with UEM.
(xxvi) A Confirmation Letter of Termination dated 15th June, 2017 was addressed by the Petitioner to the Respondent confirming termination by the Petitioner to the Respondent, wherein it is inter alia stated that the Respondent failed to take any steps to complete the activities that it was called upon to perform in the Termination Notice.
(xxvii) The Respondent by their letter dated 16th 11/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc June, 2017 replied to the Petitioner's Letter of Confirmation dated 15th June 2017, which terminated the Contract.
(xxviii) The Respondent issued a Notice invoking arbitration under the subject Contract on 27th June, 2017.
(xxix) The Respondent filed Arbitration Petition (L) No.289 of 2017 under Section 9 of the Arbitration and Conciliation Act, 1996 ("Arbitration Act") inter alia seeking injunction on invocation of the Performance Bank Guarantees. It is pertinent to note that no injunction was granted by this Court restraining the Petitioner from invoking the Bank Guarantees. (xxx) The Petitioner invoked the Bank Guarantees on 23rd June, 2017.
(xxxi) The Arbitral Tribunal passed the impugned Award on 26th August, 2021 after hearing the parties. The Arbitral Tribunal arrived at the conclusion that the Petitioner had wrongfully terminated the subject 12/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Contract on the reasons mentioned therein.
(xxxii) Being aggrieved by the impugned award, the Petitioner filed the present Commercial Arbitration Petition on 23rd November, 2021 inter alia seeking to quash and set aside the impugned Award. An Interim Application No.3169 of 2021 was also filed for stay of execution and implementation of the impugned Award. (xxxiii) This Court vide its Order dated 17 th April, 2023 admitted the present Commercial Arbitration Petition and granted stay of the impugned Award upon the Petitioner depositing the amounts under the Award with the learned Prothonotary & Senior Master of this Court.
(xxxiv) As per the direction in the Order dated 17 th April, 2023, the Petitioner deposited a sum of Rs.41,12,17,356/- in this Court on 25 th May, 2023. By virtue of this deposit, the impugned Award has been stayed.
4. Mr. Vishal Kanade, the learned Counsel appearing for the 13/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Petitioner has submitted that the Arbitral Tribunal had framed 34 issues for determination of the claim of the Respondent/Claimant therein and the Counter Claim of the Petitioner/Respondent therein. The Arbitral Tribunal awarded the monetary claim of the Claimant on issue Nos.10, 15, 16 & 17. The monetary claims have been allowed on the basis that the Petitioner failed to perform his Contractual obligations arising under the subject Contract 11th May, 2015 singed on 29th March, 2016 and that the Petitioner had breached the terms thereof because of which the Petitioner's termination has been held to be wrongful. This is covered by issue Nos.1, 2, 6, & 9.
5. Mr. Kanade has submitted that the Petitioner had terminated the said Contract on the grounds mentioned in the termination notice. The said Contract entered into between the parties i.e. the Petitioner and the Respondent primarily contemplated the Respondent to construct, erect and install the modernized effluent treatment plant and provide facilities in connection therewith. The Respondent was required to complete the works within a period of 32 months from the date of issuance of the Letter of Award (LoA) which was issued on 11th May, 2015 and the expected date of completion thus was 10th January, 2018. 14/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
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6. Mr. Kanade has submitted that the Respondent was responsible for inordinate delay in the completion of its Contractual obligations leading to the delay in the project. The Respondent had appointed one UEM as its technical collaborator and submitted the MoU with UEM to the Petitioner. As per the technical collaboration agreement UEM was responsible for basic design and detailed engineering, technical collaboration assistance, services, critical equipment supplies and expert supervision.
7. Mr. Kanade has submitted that in view of the delays on the part of the Respondent, on 9th May 2017 the Petitioner issued termination notice to complete minimum action on design and engineering within 30 days. The reason for termination by the Petitioner was on account of unsatisfactory performance of the Respondent for which remedy period of 30 days was provided under Clause 12.4 of the said Contract. During this period the Respondent was required to complete essentially six items.
8. Mr. Kanade has referred to the correspondence addressed by the Respondent which was without submitting any catch-up plan duly endorsed by UEM to arrest the delay. 15/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
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9. Mr. Kanade has submitted that the Arbitral Tribunal had found that the Respondent has no technical expertise for this project (Paragraph 107 of the impugned Award). Further, the Arbitral Tribunal held that but for participation of UEM, the Respondent could not have been awarded this tender (Paragraph 111 of the impugned Award). The Arbitral Tribunal further found that although signatures of UEM on the basic plans and engineering designs were not required but the fact remained that the Respondent had to satisfy the Petitioner that UEM was involved and had approved what was submitted (Paragraph 124 of the impugned Award).
10. Mr. Kanade has submitted that inspite of rendering the aforesaid findings, the Arbitral Tribunal gave a contradictory finding that although approval of UEM was not provided, the said Contract could not be terminated (Paragraph 163, 181 and 192 of the impugned Award).
11. Mr. Kanade has submitted that the Arbitral Tribunal has erred in equating the milestone payment for drawings at 5% as the basis of importance of submission of approved drawings without which construction could not have proceeded. He has submitted that 16/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc the value of preparation of plans cannot be conflated to the importance of approved plans, since it is only after plans for ETP were approved, could further work be carried out under the said Contract.
12. Mr. Kanade has submitted that once the Tribunal held in Paragraph 124 of the impugned Award that the Respondent had to satisfy the Petitioner herein that UEM was involved and had approved the plans that were submitted, it was for the Respondent to show that the said plans were approved by UEM. He has submitted that there is no such evidence on record. Despite rendering this finding, the Arbitral Tribunal in further portion of the said award has held that the said Contract does not provide for any involvement of UEM. He has submitted that the contradictory findings make the impugned Award perverse.
13. Mr. Kanade has submitted that there was no effective response to this argument of the Petitioner on the aforementioned issue. The findings on termination not being valid are ex facie erroneous necessitating interference under Section 34 of the Arbitration Act.
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14. Mr. Kanade has submitted that the Arbitral Tribunal has awarded monetary claims of the Respondent by deciding Issue No. 10, 15, 16 and 17 in its favour. He has submitted that the Respondent had sought the claim of work done not paid for inter alia the expenses incurred towards the purchase orders, sludge removal and shifting from Pond B to the excavated area, amounts paid to UEM and M/s. RPS (Engineering Consultant) and other work orders. In support of this claim, the Respondent had produced the Work Order/Purchase Orders, Invoices and Bank Statements in the Statement of Claim. The Petitioner had explicitly denied the contentions of the Respondent in the Statement of Defence and inter alia denied that the Respondent was entitled to any amounts under the head of work done not paid.
15. Mr. Kanade has submitted that the documents submitted by the Respondent having not been admitted by the Petitioner and denied on the ground that they were photocopies and some documents were not offered for inspection has not been considered by the Arbitral Tribunal.
16. Mr. Kanade has submitted that the Petitioner has pleaded that the Statements of Expenses have not been proved by the 18/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Respondent's witness and this further explicated the discrepancy in the purchase orders and bank statements produced by the Respondent. He has referred to the discrepancies in the documents relied upon by the Respondent. His submission is that the Statement of Expenses are not certified by the bank and is a mere print out and there are further discrepancies in the statement. He has submitted that there are no invoices which backed the Statement of Expenses and thus, no proof of payment.
17. Mr. Kanade has submitted that the work orders were not offered for inspection. Further, it does not contain acceptance by the Vendor. Hence, no evidence was led by Respondent to corroborate the same.
18. Mr. Kanade has submitted that the Arbitral Tribunal has awarded the claim of 'work done not paid' only on the basis of the statement made by the Respondent that it had made payments to various third parties, and in the absence of any supporting evidence. The Respondent had merely made bold assertions without any reasoning to support it, i.e., a bare ipse dixit.
19. Mr. Kanade has submitted that the Arbitral Tribunal has 19/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc rejected the Counter Claim of the Petitioner without furnishing reasons. On the contrary, the Arbitral Tribunal has erroneously observed that in the absence of any Counter-claim, the Respondent must be paid for work done / payments made, whether the Contract was terminated or not.
20. Mr. Kanade has submitted that the Respondent has claimed profit of 15% on the amount of work withdrawn on account of the alleged wrongful and illegal termination. However, the Respondent failed to substantiate with proof that such a loss or damage has actually been incurred. The Respondent was never prevented from performing its part of the Contract. The figure of 15% is arbitrary and unsubstantiated.
21. Mr. Kanade has submitted that the Arbitral Tribunal has erroneously awarded the claim for loss of profit on the basis that the termination of the said Contract was allegedly wrongful. He has submitted that in the event the Court interferes with the findings on termination, this issue of loss of profit would have to be answered in the negative.
22. Mr. Kanade has submitted that the Arbitral Tribunal has 20/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc erroneously awarded Rs.14,93,79,332/- for loss of profit only on the basis of the contentions made by the Respondent without any evidentiary proof thereof. Thus, such a claim could not have been awarded in the first place.
23. Mr. Kanade has submitted that the Petitioner has been directed to refund the performance bank guarantee only on the premise that the termination was invalid and Issue No. 9 being decided in favour of the Respondent. He has submitted that if the findings on Issue No. 9 i.e. the 'Issue on Termination' is found to be erroneous warranting interference under Section 34 of the Arbitration Act, the encashment of the performance bank guarantee cannot be faulted with.
24. Mr. Kanade has submitted that the Arbitral Tribunal has awarded interest of 12%. He has submitted that this is contrary to Clause 28.1(6) of the said Contract, wherein the parties have agreed that any claim for such interest made by any party shall be void. He has submitted that in view of this Contractual stipulation, the Arbitral Tribunal could not have awarded pendent lite interest on the claim granted under this issue.
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25. Mr. Kanade has submitted that the sludge cannot be equated to scrap. He has referred to the said Contract as well as the pre bid meeting held on 10th January, 2014. At the meeting the bidders which included the Respondent also consciously addressed separate queries on the method of disposal of sludge and scrap. He has submitted that the bidders including the Respondent were aware that sludge did not form part of the scrap generated from the dismantling activities under the said Contract. The Petitioner had satisfactorily answered the queries raised by different bidders clearly differentiating sludge from scrap and clarifying the method in which they had to be independently disposed. He has submitted that the clarifications provided by the Petitioner during the pre-bid meeting are to be read with and forms part of the said Contract.
26. Mr. Kanade has submitted that even in the terms of the Contract, more particularly Clause 1.11 of the Scope of Work it was postulated for a strict adherence to the statutory requirements and approvals and specifically connoted the term 'disposal' as the method of dealing with and removing sludge from the existing facilities contemplated. He has relied upon Clause 6.8 of General Conditions of Contract in support of his submission that even assuming that the 22/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Respondent herein was permitted to treat the sludge as its entitlement and dispose of the same in any manner it chooses, in view of inconsistency between discretion of the parties, the instruction of the Petitioner would prevail and the Respondent would be bound to implement the Contract in the manner as called upon by the Petitioner.
27. Mr. Kanade has submitted that the Arbitral Tribunal erred in not appreciating the test reports placed on record. The Arbitral Tribunal failed to notice that the reason for re-processing of the sludge content was a result of the 3 rd Test Report, which was conclusive in relation to presence of hydrocarbons. He has submitted that it was in that context that the Petitioner re-processed the sludge from surge pond B.
28. Mr. Kanade has submitted that the Petitioner's re- processing sludge from surge pond B has been disregarded by the Arbitral Tribunal.
29. Mr. Kanade has submitted that the Arbitral Tribunal has failed and erred in awarding the Claim for loss of revenue against sludge recycling. He has submitted that the basis of granting the 23/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc claim is that scrap and sludge are synonymous and that amount of Claim (Rs.4000/- per MT) is based on a single document being a purported letter dated 10th August 2015 from the Respondent to MOCL.
30. Mr. Kanade has submitted that the Petitioner had denied the aforementioned document in his Statement of Defence. This document had been relied upon by the Respondent's witness in his evidence, however, the contents of the documents have not been proved in evidence.
31. Mr. Kanade has submitted that the Respondent having failed to prove its case is evident from reading of Paragraph 234 of the said Award, inspite of which the Tribunal relied upon the approximate sludge quantity of 4459 MT, suo moto and without any basis increased this quantity to 5000 MT. He has submitted that there was no basis for this supposition and conjecture. He has submitted that even the rate mentioned of Rs. 4,000/- was not proved in as much as this is a quotation and not a final Contract. He has submitted that accordingly, the Arbitral Tribunal has arrived at findings which are not supported by evidence and / or has not dealt with objections of the Petitioner to the admissibility and reliance on 24/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc this document while granting the claim.
32. Mr. Kanade has accordingly submitted that the impugned Award be set aside as the impunged Award has been challenged within the scope and confines of Section 34 of the Arbitration Act on the ground that the impugned Award is patently illegal and perverse.
33. Mr. Kanade has in support of his submission that the impugned Award is vitiated on account of patent illegality and findings rendered in the impugned Award are merely based on the Respondent's herein contentions without dealing with the Petitioner's evidence is against the public policy of India has relied upon the Judgment of the Supreme Court in Ssangyong Engineering Construction Ltd. v. NHAI1 at Pargraphs 34 to 36 (Award being against public policy) and Paragraph 37 onwards (Setting out the grounds of patent illegality); Delhi Metro Railway Corporation Pvt. Ltd. v. Delhi Airport Metro Express Pvt. Ltd. 2 at Paragraph 29 onwards & Associate Builders v Delhi Development Authority 3 at Paragraph 27 onwards.
1 [(2019) 15 SCC 131] 2 [(2024) 6 SCC 357] 3[(2015) 3 SCC 49] 25/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc
34. Mr. Kanade has submitted that there is no proof of loss of profit adduced by the Respondent in support of its claim and the amount awarded is merely predicated on there being breach on behalf of the Petitioner. In support of his submission on this issue, he has relied upon the ratio laid down in the Judgments requiring the party claiming damages (including by way of loss of profit) to establish proof of the damages suffered upon established procedure and principles. These Judgments are as under:
(i) Bharat Coking Coal v LK Ahuja [(2004) 5 SCC 109] at Paragraph 24.
(ii) State of Rajasthan and Another Versus Ferro Concrete Construction Private Limited [(2009) 12 SCC 1] at Paragraph 24 read with Paragraphs 52 to 55.
(iii) Essar Procurement Services Ltd. v. Paramount constructions (2016 SCC OnLine Bom 9697) at Paragraphs 101 to 113.
35. Mr. Kanade has submitted that the Arbitral Tribunal has erred in awarding the claim for pendent lite interest, particularly in view of the Contractual bar contained in the said Contract between 26/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc the parties. He has in support of this submission relied upon Union of India v Manraj Enterprises4 at Paragraphs 23 to 36 & IOCL v. Shree Ganesh Petroleum Ltd.5 at Paragraphs 15 and 44.
36. Mr. Kanade has distinguished the Judgments cited on behalf of the Respondent as being inapplicable to the present case. He has submitted that the impugned Award be set aside as it has been challenged within the scope and confines of Section 34 of the Arbitration Act as being patently illegal and perverse.
37. Mr. Mayur Khandeparker, the learned Counsel appearing for the Respondent has submitted that the Arbitral Tribunal has arrived at findings with regard to the rival issues as to Performance of the Work and which are in Paragraphs 195 to 226 of the impugned Award.
38. He has submitted that disposal of the sludge was the prime activity without which the work could not be progressed. It is an expressed finding of the Arbitral Tribunal that the Petitioners wrongly insisted on the Respondent for disposing the sludge through incineration right from start of work. This is despite 3 Test Reports 4 (2021 SCC OnLine SC 1081) 5(2022 SCC OnLine SC 131) 27/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc on the record which clearly established that the sludge was to be recycled. He has referred to the three Reports which have been relied upon by the Arbitral Tribunal viz. Geo Chem Report dated 31st December, 2015; MPCB Report dated 17 th May, 2016 & MWML Report dated 07th September, 2016.
39. Mr. Khandeparkar has submitted that there were further activities as per the Planning Package which could not be achieved as the prime activity of disposal of sludge was still not completed due to the Petitioner's insistence in not allowing the Respondent to dispose sludge through recycling. Hence, the delay in progress though negligible, was purely on the Petitioner's Account.
40. Mr. Khandeparkar has submitted that finally after 18 Months on 29th November, 2016 the Petitioner gave permission and allowed the Respondent to shift the sludge inside the Plant in nearby area of Pond-B. Due to the bulk quantity of sludge of 7500 MT the Respondent consumed a period of 3.5 Months to shift the Sludge. The shifting was completed by March, 2017. It was only then that the Respondent could place orders for Equipment and submitted 143 Nos. of Drawings against Requirement of 129 Drawings as per Planning Package.
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41. Mr. Khandeparkar has submitted that the Petitioners by their Show Cause Notice dated 9th May, 2017 called upon the Respondent to show progress as per the Original Planning Package without considering the delay of 18 Months committed by the Petitioner in giving their decisions for disposal of the sludge.
42. Mr. Khandeparkar has submitted that the Respondent has in its correspondence shown its bonafides by placing orders of Equipment's, submitting Drawings with respect to progress of the work and requested the Petitioner not to compare the progress achievable as per the Planning Package. This due to the sludge having to be removed 18 months back but it was on the Petitioner's wrong insistence and wrong decision that the entire said period of 18 Months was wasted. He has submitted that the progress has to be calculated by giving effect of sludge removal from November, 2016 instead of May, 2015.
43. Mr. Khandeparkar has submitted that the Petitioner terminated the Contract on 15 th June, 2017 without dealing with any of the issues raised by the Respondent and without considering the aforementioned correspondence of the Respondent. 29/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
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44. Mr. Khandeparkar has referred to the findings of the Arbitral Tribunal at Paragraphs 223 & 224 of the impugned Award wherein there is a categorical finding that the Respondent had achieved a progress of 2.01% which as per the statistics in Planning Package only 1.62% could have been achieved without removal of sludge. Hence, the Respondent had achieved more than what was required.
45. Mr. Khandeparkar has submitted that the Arbitral Tribunal has awarded an amount of Rs. 1.06 Crores only for which the Respondent had submitted the Invoices & Work Orders of UEM, the Engineering Consultant and Vendors. The Respondent had also submitted the Bank Statements in support thereof. He has submitted that it is not the case of the Petitioner that the payments made to Vendors were pertaining to another Contract. The Bank Statements clearly establish that the payment of Rs. 1,06,91,238.00 was made by the Respondent to UEM, the Engineering Consultant and Vendors under the said Contract. The evidence of Respondent Witness was left uncontroverted as no questions were asked by the Petitioner in that regard. Accordingly, the awarded sum of Rs.1,06,91,238.00 was justified.
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46. Mr. Khandeparkar has submitted that reliance has been placed by the Petitioner on the Pre-Bid Meeting on the queries of the Bidders wherein the Petitioner had recorded that "MWML, Taloja an approved Party from CPCB / MPCB for handling / disposal. Bidder may fix Contract and dispose sludge". He has submitted that this was not an explicit condition but merely a suggestion on the part of the Petitioner.
47. Mr. Khandeparkar has submitted that it was the case of the Respondent that the Respondent had shifted 7500 MT of sludge in the area nearby to Pond-B inside the Plant allotted by the Petitioner. However, the said quantity was not awarded by the Tribunal against which the Tribunal awarded 5000 MT of sludge revenue to the Respondent. He has submitted that the impugned Award for quantity of 5000 MT was based on various documents on the record. The dimension of the Pond- B where sludge was lying was answered in pre-bid query by the Petitioners. Further, during cross-examination of RW-1, in Q.138, the witness has answered that the dimensions of the Pond were l00 meters x 35 meters; hence, the Quantity of Sludge can be worked out as 100 x 35 x 2.00 Depth = 7000 cum which translates to 7000 MT; the Petitioner's Suggestion to 31/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc the Respondent Witness CW-1 during cross examination was that the maximum capacity of the surge pond B is 7500 MT. CW-1 had confirmed that the Sludge of 7500 MT was shifted from one Pond to the other; it was the case of Petitioner that the sludge lying in the Pond was 7500 MT; Respondent's CW- 1 Evidence at Paragraph 31 has pleaded his case for Quantity of 7500 MT.
48. Mr. Khandeparkar has submitted that the impugned Award for quantity of 5000 MT is substantiated based on the documents produced. He has referred to the MPCB Letter dated 23 rd January 2013 which gave Consent to the Petitioner to operate for 5000 MT of oil sludge from the storage tank in Ponds under Sr. No. 3.3 of Schedule I of the HW Rules 2008 which provides for disposal through CHWTSDF for incineration / bioremediation / MPCB authorized reprocessor. Further, the Petitioner's Witness RW-1 in answer to Question 67 admitted that the 2014 consent to operate does not apply to the 5000MT of sludge which was lying in the surge ponds since the same was covered only by the earlier 2013 Consent to Operate. Hence RW-1 had admitted the quantity of 5000 MT lying in Surge Pond. Finally, Petitioner floated the Tender on 14 th March, 2017 for recycling of the said sludge and mentioned Estimate 32/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Quantity as 4459 MT of sludge. He has submitted that there was sufficient evidence to support at least minimum quantity of 5000 MT of sludge lying.
49. Mr. Khandeparkar has submitted that the Arbitral Tribunal had considered and allowed the quantity of 5000 MT of sludge revenue to the Respondent. The Petitioner has not dealt with the aforementioned documents in Rejoinder.
50. Mr. Khandeparkar has submitted that the objection to the rate of sludge of Rs.4000 Per MT is misplaced. There is sufficient material to justify the said rate considered by the Arbitral Tribunal. He has referred to the Order dated 01st August, 2015 placed on MOCL @ Rs.4000/ Per MT by the Respondent for disposal of sludge. The MOCL had attended and participated in the process of Sample Testing of the Sludge inside the Uran Plant. Further, MOCL was an Approved Agency for recycling, approved by MPCB & CPCB. He has also relied upon the DAR and Final Audit Report wherein it was recognised by the Petitioner's Audit Team that for recycling of sludge, the rate prevailing prior to the year 2000 was Rs.1600/-
51. Mr. Khandeparkar has submitted that the Respondent's 33/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc CW-1 Evidence at Paragraph 31 has pleaded its case and claimed the Rate of Rs.4000/- Per MT for the said quantity of sludge. This evidence was left uncontroverted as no questions were asked by the Petitioner in that regard. He has submitted that after a period of 17 years, it cannot be said that the rate of Rs.4,000/- is inflated and / or exaggerated. He has submitted that the Tribunal based on the aforementioned documents granted Award for the quantity of 5000 MT to be paid @ Rs.4000/- MT amounting to Rs.2.00 Crores to the Respondent and hence, the impugned Award insofar as this claim is concerned is justified.
52. Mr. Khandeparkar has then referred to the findings of the Arbitral Tribunal on the claim of loss of profit, in particular Paragraphs 195 to 226 of the impugned Award. The Arbitral Tribunal has rendered detailed justification with elaborate findings that termination of the Contract was declared as illegal and wrongful. Hence, the claim for Loss of Profit was justified.
53. Mr. Khandeparkar has submitted that the Petitioner's contentions that the Respondent was never prevented from performing its part of Contract is a mere Statement without any supportive document.
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54. Mr. Khandeparkar has submitted that the Respondent never lacked in achieving the progress and that the termination of the Contract was wrongful & unjustified. He has reiterated his submissions with regard to the sludge being recyclable and within the Respondent's Scope. The Respondent has relied on various documents to substantiate that the Respondent was very well prevented from progressing the work and the Petitioners action of terminating the Contract for short progress was highly erroneous since the Petitioner itself had delayed the work and hence could not have expected / sought the progress from the Respondent achievable as per planning package more specifically by giving decision of sludge on 29th November, 2016 which otherwise was to be given in May, 2016.
55. Mr. Khandeparkar has placed reliace upon A. T. Brij Paul Singh v. State of Gujarat,6 and Mohd. Salamatullah V. Govt.of A.P. 7 wherein the Supreme Court has laid down directives that the proof of expected profit cannot be given but on the grounds of wrongful termination and upon which the Loss of Profit claim will follow @ 15% towards the amount of balance remaining work. He has 6 (1984) 4 SCC 59) 7(1977) 3 SCC 590) 35/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc submtited that it is the Respondent's case that in the said Contract the Respondent Profit Margin was 15% on the entire Contract sum i.e. Rs.111,04,76,499/-.
56. Mr. Khandeparkar has submitted that the balance work remained to be executed was Rs.99,58,62,217/- after deducting the total work claimed to be done i.e. Rs. 11,46,14,282/- Hence, 15% on said balance remaining work of Rs.99,58,62,217/- comes to Rs. 14,93,79,332/-.
57. Mr. Khandeparkar has submitted that the Respondents through CW-1 Affidavit of Evidence has claimed 15% on the aforementioned balance remaining work which comes to Rs.14,93,79,332/-.
58. Mr. Khandeparkar has submitted that the evidence of Respondent's witness was left uncontroverted as no questions were asked by the Petitioner in this regard. He has submitted that the Arbitral Tribunal in Paragraphs 248 to 252 of the impugned Award has with sufficient justification awarded amount of Rs.14,93,79,332/- towards Loss of Profit.
59. Mr. Khandeparkar has submitted that the Petitioners' 36/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc contention that out of entire Contract sum of Rs.111,04,76,499/-, the Cost of Rs.16,74,85,000/- was towards the operation & maintenance work and hence the Loss of Profit ought not to have been granted by the Arbitral Tribunal for the said operation & maintenance work is misplaced. He has submitted that whereas the Respondent had a Profit Margin of 15% on entire Contract value including for the work of operation & maintenance of Rs.16,74,85,000/- since the said work was to maintain the ETP Plant i.e., the subject work itself. Hence, the Respondent had correctly claimed the Loss of Profit on the balance remaining entire subject Contract work. He has accordingly submitted that the finding of the Arbitral Tribunal of Rs.14,93,79,332/- which was the claim for Loss of Profits was justified and there is no error or discrepancy in such finding.
60. Mr. Khandeparkar has submitted that the Arbitral Tribunal in Paragraphs 195 to 226 of the impugned Award has rendered detail justification with elaborate findings that Termination of the Contract was declared as illegal and wrongful. Hence, the claim for refund of Bank Guarantee was justified. He has submitted that the Arbitral Tribunal in Paragraph 264 of the impugned Award allowed refund of Performance Bank Guarantee amount of 37/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Rs.9,42,99,150/- alongwith interest @ 12% from the date the Petitioner received the said amount from the Bank. This is totally justified.
61. Mr. Khandeparkar has submitted that the Supreme Court has laid down directives that in the Award if the reasons appear to be insufficient or inadequate but on a careful reading of the Entire Award, coupled with Documents recited / relied therein, the underline the reason, factual or legal, that forms the basis of the Award is in discernible / intelligible and the same Exhibits no perversity then the Court need not set aside the Award while exercising the powers under Section 34 and 37 of the Act. The Court may explain the existence of that underline the reason while dealing with a challenge laid to the Award and in doing so, the Court does not supplant the reasons of the Arbitral Tribunal but only explains it for a better and a clearer understanding of the Award. He has placed reliance upon the Judgment of the Supreme Court in OPG Power Generation Pvt. Ltd. V/s. Enexio Power Cooling Solutions India Pvt. Ltd. & Anr.,8 at Paragraph 148 in this context.
62. Mr. Khandeparkar has submitted that the jurisdiction of 8 2024 SCC Online SC 2600 38/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc the Courts under Section 34 is fairly narrow and the Court may interfere on merits on limited grounds under Section 34 of the Arbitration Act. He has in this context placed reliace upon the Judgment of the Supreme Court in UHL Power Co. Ltd. Vs. State of Himachal Pradesh9.
63. Mr. Khandeparkar has further relied upon the Judgment of the Supreme Court in Delhi Airport Metro Express Private Limited Vs. Delhi Metro Rail Corporation Limited10 in support of his submission that the Courts cannot re-appreciate evidence to conclude that the impugned Award suffers from patent illegality.
64. Mr. Khandeparkar has submitted that if the conclusion of the Arbitrator is based on a possible view of the matter, the Court should not interfere. In this connection he has placed reliance upon the Judgment of the Supreme Court in OPG Power Generation Pvt. Ltd. (supra).
65. Having considered the submissions, the Arbitral Tribunal has in the impugned Award held that the Petitioner / Respondent therein had failed to perform its Contractual obligations under the 9 (2022) 4 SCC 116 10 (2022) 1 SCC 131 39/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc said Contract dated 11th May, 2015 signed on 29th March, 2016. There is a finding that the Petitioner has breached the terms of the said Contract and because of which the Petitioner's termination has been held to be wrongful. This is a finding in relation to Issue Nos.1, 2, 6, & 9. It is by virtue of this finding that the Arbitral Tribunal has awarded the monetary claim of the Respondent / Claimant therein under Issue Nos.10, 15, 16 & 17.
66. The Petitioner has contended that the Arbitral Tribunal has erroneously held that the Petitioner has wrongfully terminated the Contract. It is their contention that the delay in performance of the said Contract i.e. delay in issuance of the basic plans and engineering design / drawings had resulted in the Termination Notice to complete minimal action on design and engineering within 30 days thereof. There is reliance upon the period within which the Respondent was to complete the works under the said Contract i.e. to construct, erect, install the modernized Effluent Treatment Plant and provide facilities for air-conditioning, ventilation, testing, painting, lining, insulation, commissioning and guaranteeing the entire modernization of ETP. These contentions are in my view misplaced and are contrary to the plain reading of the said Contract as well as 40/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc the documents on record / evidence which was before the Arbitral Tribunal and appreciated by them.
67. The Petitioner has called upon this Court exercising jurisdiction under Section 34 of the Arbitration Act to re-appreciate the evidence as well as arrived at an interpretation of the terms of the Contract contrary to that arrived at by the Arbitral Tribunal and particularly when the conclusion of the Arbitral Tribunal is a possible view. It has been held by the Supreme Court in Delhi Airport Metro Express Pvt. Ltd. (Supra) that Courts exercising jurisdiction under Section 34 of the Arbitration Act cannot re-appreciate evidence to conclude that the Award suffers from patent illegality. Further, the Supreme Court in OPG Power Generation Pvt. Ltd. (Supra) has held that if the conclusion of the Arbitrator is based on a possible view of the matter, the Court under Section 34 of the Arbitration Act should not interfere. The grounds raised by the Petitioner are directly hit by the aforementioned Judgments of the Supreme Court as these are considered to be not valid grounds to be raised under Section 34 of the Arbitration Act.
68. The contention of the Petitioner that the Arbitral Tribunal erred in equating the mile stone payment for drawings at 41/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc 5% as the basis of importance of submission of the approved drawings without which construction could not have proceeded is misconceived. The Arbitral Tribunal has in construing the Contract held that the disposal of the sludge was a prime activity without which the work of construction / engineering under the said Contract could not proceed. The Petitioner had wrongly insisted on the Respondent disposing the sludge through incineration right from the start of the work. The Arbitral Tribunal has placed reliance upon the three Test Reports viz. Geo Chem Report dated 31st December, 2015; MPCB Report dated 17th May, 2016 & MWML Report dated 07 th September, 2016 which clearly establish that sludge was to be recycled, inspite of which, the Petitioner insisted on the Respondents to dispose of the sludge through incineration.
69. The Petitioner's reliance on the work to be completed within a period of 32 months from the date of issuance of the LoA and there being delay in issuance of basic plans and engineering design / drawings is entirely misplaced. The issuance of the basic plans and engineering designs / drawings by the Petitioner cannot be read in isolation as the prime activity was the disposal of sludge, without which the construction work could not commence. 42/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
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70. It is to be seen that the Petitioner after a period of 18 months of execution of the said Contract, i.e. on 29th November, 2016 gave permission and allowed the Respondent to shift the sludge inside the Plant in nearby area of Pond-B. It is only after the period of 3.5 months consumed by the Respondent for shifting the bulk quantity of sludge of 7500 MT and which was completed by March, 2017, could the Respondent placed orders for equipment and submit 143 numbers of drawings against requirement of 129 drawings as per the planning package.
71. The Petitioner has relied upon findings of the Arbitral Tribunal that but for the participation of UEM who had technical expertise, the Respondent would not have been awarded the tender and that although the signatures of UEM on basic plans and engineering designs were not required but the fact remains that the Respondent had to satisfy the Petitioner that UEM was involved and had approved what was submitted. This Petitioner has by placing reliance on these findings contended that the Arbitral Tribunal gave contradictory finding that though the approval of UEM to the basic plans and engineering designs was not provided, the said Contract could not be terminated. This contention in my view is misconceived. 43/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 :::
J-CARBP 648.2021.doc This overlooks the conclusion arrived at by the Arbitral Tribunal that under the said Contract, the approval of UEM to such basic plans and engineering designs was not required.
72. The Termination of the Contract on 15th June, 2017 by the Petitioner was without considering the issues raised by the Respondent and the multiple correspondence addressed by them. The Arbitral Tribunal has in Paragraphs 223 and 224 given a categorical finding that the Respondent had achieved progress of 2.01% which as per the statistics and planning package only 1.62% could have been achieved, without removal of sludge. Hence, the Respondent had achieved more than what was required.
73. The Arbitral Tribunal after appreciating the evidence on record as well as terms of the said Contract has awarded the amount of Rs.1.06 Crores for work done but not paid and this after finding that the termination of the said Contract by the Petitioner was wrongful. This Court under Section 34 of the Arbitration Act, cannot re-appreciate the evidence which is in the form of invoices and work orders of UEM, the Engineering Consultants and Vendors as well as the bank statements which were produced by the Respondent and upon an appreciation of which the Arbitral Tribunal has held that 44/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc they establish payment of Rs.1,06,91,238/- made by the Respondent to UEM, the engineering consultants and vendors under the said Contract. Thus, I find no infirmity in the findings in the Award on the material forming part of the evidence and which has been appreciated by the learned Arbitrator.
74. In so far as the issue of loss of revenue against sludge recycling, the findings of the Arbitral Tribunal in the impugned Award for quantity of 5000 MT is based on the evidence on record as well as various documents produced by the Respondent. The evidence of the Respondent through its witness CW-1 has been referred to whilst recording the submissions on behalf of the Respondent. The Arbitral Tribunal having found that there was sufficient evidence to support at least minimum quantity of 5000 MT of sludge lying, this finding on evidence cannot be faulted with particularly by this Court exercising jurisdiction under Section 34 of the Arbitration Act. Further, it is well settled that re-appreciation of evidence is impermissible.
75. With regard to the rate of Rs.4000 per MT, the Arbitral Tribunal has held that there was sufficient material to justify the said rate and based upon which the Arbitral Tribunal has held that the 45/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc loss of revenue against sludge recycling is Rs.2 Crores. This finding of the learned Arbitral Tribunal is also on an appreciation of evidence, and cannot be re-appreciated as held above.
76. The claim for loss of profits of Rs.14,93,79,332/- awarded by the Arbitral Tribunal is pursuant to elaborate findings that the termination of the Contract by the Petitioner was illegal and wrongful. It has been held by the Supreme Court M/s. AT Brij Paul Singh (Supra) and Mohd. Salamatullah & Ors. (Supra) that proof of expected loss of profit cannot be given but on the grounds of wrongful termination. The loss of profit claim will follow at the rate of 15% towards the amount of balance remaining work. The attempt made by the Petitioner to distinguish these Judgments is entirely misconceived. The Arbitral Tribunal has awarded the sum of Rs.14,93,79,332/- on the basis of 15% on the balance remaining entire subject Contract work. This after taking into consideration the work done of Rs.11,46,14,282/- which has been deducted from the entire Contract sum of Rs.111,04,76,499/- leaving balance work as Rs.99,58,62,217/- from which 15% has been computed as the loss of profit. I am of the considered view that there is no infirmity in the Arbitral Tribunal awarding the claim of loss of profits of 46/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc Rs.14,93,79,332/- which is as per the terms of the said Contract and the settled law.
77. In so far as the claim of release / refund of Performance Bank Guarantee which has been awarded i.e. in a sum of Rs.9,42,99,150/-, this follows from the finding that the termination of the said Contract was illegal and wrongful. Hence, in view of this finding of the Arbitral Tribunal which has been upheld by this Court under Section 34 of the Arbitration Act, the Respondent is entitled to refund of Performance Bank Guarantee which has been invoked by the Petitioner on the grounds of termination of the said Contract. The interest awarded also cannot be faulted with as reasonable rate of interest has been awarded by the Arbitral Tribunal and this awarded claim is totally justified.
78. The reliance placed by the Petitioner on Ssangyong Engineering Construction Ltd. (Supra); Delhi Metro Railway Corporation Pvt. Ltd. (Supra) and Associate Builders (Supra) in contending that the impugned award is against the public policy of India and requires to be set aside is misplaced. These Judgments do not apply in the present case as the Arbitral Tribunal has appreciated the evidence on record and arrived at its findings based on such 47/48 ::: Uploaded on - 17/10/2025 ::: Downloaded on - 18/10/2025 01:02:14 ::: J-CARBP 648.2021.doc appreciation of which cannot be re-appreciated under Section 34 of the Arbitration Act as per settled law.
79. I further do not find merit in the reliance placed by the Petitioner in Bharat Coking Coal (Supra); State of Rajasthan (Supra) and Essar Procurement Services Ltd. (Supra) in support of their contention that the party claiming damages (including by way of loss of profits) is required to establish proof of damages suffered upon established procedure and principles. These Judgments are inapplicable in the present case as they are distinguishable on facts.
80. The Arbitration Petition having raised grounds of challenge to the impugned Award which are not valid under Section 34 of the Arbitration Act is dismissed. There shall be no orders as to costs.
81. The Prothonotary and Senior Master of this Court is directed to release the sum of Rs.41,12,17,356/- deposited by the Petitioner for stay of the impugned Award together with the accrued interest to the Respondent within a period of six weeks from uploading of this Judgment.
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