Case: Gujarat Water Supply & Sewerage Board v. Man Industries (India) Ltd., CIVIL APP. NO. 1 of 2024 In R/F APPEAL NO. 1257 of 2024
In the procurement of Mild Steel Pipes for the Gujarat Earthquake Reconstruction and Rehabilitation Project, a contractual dispute arose between the Gujarat Water Supply and Sewage Board (the appellant) and M/s. Man Industries Limited (the respondent). Allegations of delay in releasing the advance payment by the appellant and subsequent hindrances like rain caused delays in the project. A dispute emerged over the extension of time for supply and the penalty for delayed delivery. Arbitration ensued, resulting in a Sole Arbitrator’s award granting an 87-day extension for supply and directing the release of the balance amount to the respondent. Following this initial award, subsequent corrections and quantification of the awarded amount were made through arbitration proceedings, resulting in additional awards. The appellant challenged the award under Section 34 of the Arbitration Act, but the Commercial Court dismissed the challenge. Consequently, the appellant sought redress in the High Court of Gujarat (the Court) under Section 37.
The key issues, in this case, involve the extension of time granted by the Sole Arbitrator for completing the supply of pipes, the determination of the award amount, and the validity of the appellant’s challenge to the award under Section 34 of the Arbitration Act. Specifically, the dispute centres on whether the extension of time was reasonable, if the awarded amount was justifiable, and the legitimacy of the appellant’s challenge to the arbitration decision.
In the present case, the Court found that the Arbitrator’s decision to grant an extension of time for supply by 87 days was justified and within the scope of the contract and the original award. Consequently, the Court upheld the Arbitrator’s decision regarding the extension of time. The court observed that the additional award provided clarity on the exact amount payable under the original award and the contract. It determined that the additional award did not create any new liability beyond what was established in the original award. Therefore, the Court upheld the amount of the award as determined by the Arbitrator. Additionally, the Court affirmed that the Arbitrator had the authority to pass an additional award interpreting the original award and correcting typographical errors. It concluded that the Arbitrator had not exceeded his jurisdiction in issuing the additional award and upheld the decisions made by the Arbitrator, considering them to be within the scope of the contract and the applicable laws.
Consequently, the Court dismissed the appeal and upheld the order of the Commercial Court and the arbitration award, ensuring the enforceability and clarity of the original award through the additional award.

Author of this article:
Adv. Ravish Bhatt,
Partner, R&D Law Chambers,
Dual Qualified Lawyer Solicitor | International Tax Affiliate

Connect with Mr. Bhatt on Linkedin: https://www.linkedin.com/in/adit-ravishbhatt/

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