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TMI Blog2019 (5) TMI 1915X X X X Extracts X X X X X X X X Extracts X X X X ..... remained unpaid, monies had been retained from the running bills by HCC and that huge amounts had been incurred by Ipex by way of idling cost due to a misrepresentation made by HCC with regard to the availability of hindrance free site. The fact that HCC coerced Ipex to extend the PBG from time to time is an aspect which also emerges from the record. Petition dismissed. - O.M.P. (COMM) 208/2019 - - - Dated:- 20-5-2019 - HON'BLE MR. JUSTICE RAJIV SHAKDHER For the Petitioner : Mr. Dayan Krishnan, Sr. Advocate with Mr. Rishi Agrawala, Advocate For the Respondent Through Mr. CP Khurana, Sr. Advocate with Mr. Sachin Sood Ms. Priya Soni, Advocates. ORAL RAJIV SHAKDHER, J. 1. This is a petition preferred under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter referred to as 1996 Act ) to assail the award dated 08.01.2019. 2. Brief facts, which, one would be required to notice to adjudicate upon the instant petition, are as follows: 2.1 The Petitioner i.e. Hindustan Construction Company Limited (hereafter referred to as HCC ) on 15.07.2014 entered into a Contract with Delhi Metro Rail Corporation Limited (in short DMRC ) to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause 4 of the LOI, the security deposit was to be created by crediting in favour of HCC 5% from the running bills that Ipex would submit during the course of execution of the sub-contract works, which ultimately was to be released to it upon submission of a bank guarantee of an equivalent value. The bank guarantee though was required to be kept alive till the expiry of the defect liability period which spanned a period of 12 months commencing from the date provided in Clause 4. This apart, Clause 5 of the LOI required Ipex to furnish a performance bank guarantee (in short PBG ) equivalent to 5% of the value of the sub-contract works. The PGB was required to be kept valid till 31.12.2015 and for a further period of 60 days thereafter; being the claim period. As required, Ipex furnished the PBG. 2.7 The record shows that there is much correspondence on the subject involving failure of HCC to furnish hinderance free site and the consequent losses caused to Ipex, inter alia, in the form of idling cost. There are also letters on record which demonstrate the concern of Ipex in HCC s failure to divert the utilities at the site which were causing hindrance and the resultant loss to it. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shows that there was a lot of back and forth on this issue. Ipex was reluctant to take such a step not only on account of mounting losses but also due to the fact that it was unable to make payment to its own staff and vendors. 3.5 Ipex s grievances with regard to HCC s: failure in opening the LOC, its losses on account of idling charges and non-payment of bills, and the resultant non-payment by Ipex of its dues qua staff and vendors are captured in the following communications exchanged between them: 13.05.2016. 23.06.2017, 07.07.2016, 25.07.2016 and 08.08.2016. 3.6 It was because of these reasons that Ipex, apparently, resisted the extension of the validity period of the PBG. 3.7 However, ultimately, albeit, under protest, Ipex on 13.09.2014 extended the validity of the PGB by a further period of six months. 3.8 Ipex followed this up by triggering the arbitration agreement on 29.09.2016. On 14.10.2016, HCC wrote to Ipex that it should submit its dispute to the project manager/construction head/Vice-President sub-contracts. Ipex, as advised, took the necessary steps and, in fact, on 10.12.2016 made attempts to resolve the disputes amicably. It appears that there was no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me with the learned arbitrator. 4.5 Admittedly, HCC failed to file its written submissions before the deadline set down by the learned arbitrator. The record filed before me shows that the written submissions were filed on behalf of HCC by its counsel on 14.12.2018, albeit, with the DIAC. As indicated above, the learned arbitrator had indicated that counsel for the parties will exchange their respective written submissions before filing the same with the learned arbitrator. 4.6 On being queried, counsel appearing for the HCC conceded that neither Ipex nor its counsel was served with a copy of the written submissions. 4.7 Given this position, the learned arbitrator proceeded to decide the matter based on the record placed before it. Via the impugned award, the learned arbitrator examined the six claims lodged before him by Ipex. These were: (i) claim in the sum of ₹ 75,72,369/- towards running bills raised by Ipex which remained unpaid; (ii) claim towards money in the sum of ₹ 25,52,807/- retained by HCC from running bills; (iii) release of bank guarantee amounting to ₹ 25 lakhs along with reimbursement of guarantee charges in the sum of ₹ 57,481/-; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rator for arguments, counsel for HCC chose not to advance any oral submission and instead sought an opportunity to file written submissions. The learned arbitrator acceded to this request and, accordingly, directed that the written submissions on behalf of HCC should be filed on or before 30.11.2018. A similar opportunity was given to Ipex. Ipex was required to file its written submissions by 7.12.2018. This fact is borne out from the procedural order dated 12.11.2018, which was handed over in the course of the arguments by Mr. Khurana, learned senior counsel, appearing on behalf of Ipex. 7.1 For the sake of convenience, the relevant part of the procedural order dated 12.11.2018 is extracted hereafter: Arguments have been heard on behalf of the claimant. Ld. Counsel for the Respondent states that he would like to place on record written synopsis on or before 30.11.2018. Claimant also, if so advised may file written synopsis by 07.12.2018. Both parties will exchange the written synopsis before filing to the Arbitrator 7.2 As noted hereinabove, it has been conceded by the counsel for HCC that written submissions dated 14.12.2018 filed on behalf of HCC were not served on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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