Case: National Highways Authority Of India Vs. M/S Kcc Buildcon Pvt. Ltd. O.M.P.(MISC.) (COMM.) 327/2024

In this case, a dispute emerged between the NHAI and M/S Kcc Buildcon Pvt. Ltd. (“Respondent”) over an Engineering, Procurement, and Construction agreement (EPC) initiated between them. Consequently, an Arbitral Tribunal was established on 23rd December 2021, with a mutually agreed six-month extension. However, delays in the arbitration process arose due to the Respondent’s requests for amendments to the written statement and statement of claims in September 2022. As the proceedings advanced to the Respondent’s cross-examination phase, the respondent opted to nominate a new arbitrator, citing concerns about the previous tribunal’s impartiality. Additionally, the respondent initiated a petition under Section 11 of the Arbitration and Conciliation Act, 1996 in the Delhi High Court (the Court), seeking the appointment of a new arbitrator and a fresh constitution of the tribunal. In response, the NHAI sought an extension of the Arbitral Tribunal’s mandate through an application under Section 29A of the Arbitration Act. 

The primary issue revolves around the validity of the allegations made by the Respondent against the Arbitral Tribunal. The Court had to determine whether these allegations had any substantial basis and were in line with the principles governing the arbitral process. Another crucial issue pertained to the responsibility for the delays in the arbitration proceedings. The Court needed to ascertain whether the delays, particularly in the presentation of evidence, were primarily attributable to actions taken by the Respondent or other factors.

The Court first addressed the validity of the allegations raised by the Respondent against the Arbitral Tribunal. By concluding that these allegations lacked substantial basis and were contrary to arbitration principles, the Court highlighted the importance of maintaining integrity and fairness in the arbitration process. Furthermore, the Court emphasized that such unfounded allegations not only undermine the spirit of arbitration but also contribute to unnecessary delays.

Later the court analyzed the responsibility for the delays in the proceedings. By determining that the delays were primarily due to actions taken by the Respondent, such as requests for amendments and submission of additional evidence, the Court highlighted the need for parties to adhere to procedural efficiency in arbitration cases.

Overall, the Court’s analysis determines the significance of upholding principles of fairness, integrity, and efficiency in arbitration proceedings. By extending the mandate of the Arbitral Tribunal, the Court aimed to ensure that the arbitration process proceeds in a manner consistent with these principles while discouraging unjustified accusations that could undermine its integrity.

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

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