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TMI Blog2023 (10) TMI 417X X X X Extracts X X X X X X X X Extracts X X X X ..... opean Guideline) was never objected to by the Contractor at the time of design change suggested by the DMRC or that the same was not required. AT has further observed that even before the AT, the Contractor was unable to link the design change to the requirement of conformity with the European standard and the increase in the number of bolts. Even otherwise, it is seen that in terms of Clause 5.1 of the Contract, the Contractor was responsible for submitting the design in accordance with Clause 6.3.2 of the Contract, which was subject to DMRC s approval. Design was submitted by the Contractor on 03.06.2015 and the same was found to be deficient by DMRC which was conveyed to the Contractor vide its letter dated 08.06.2015. It is observed by AT in the award that the Contractor did not challenge DMRC s comments on the design submitted by it and on its own re-submitted a new bolt calculation on 19.09.2015 - the rates quoted in Item 8 of the BOQ are for quantities that are measured in metre length of the track of various radii. The quantities of individual items of the track fitting system was neither sought for by DMRC in the BOQ nor quoted by the Contractor when they submitted thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completion as 22.02.2017. A formal Contract was also executed between the parties. The work was completed on 06.08.2018 i.e., after a delay of 18 months. DMRC had granted extensions of time (hereafter, EOT ) for the entire prolongation of contract without levy of any liquidated damages. DISPUTES BEFORE THE AT 4. The Contractor filed its statement of claims (hereafter, SOC ) thereby raising as many as 12 claims. Claim Nos.2, 3, 4 and 12, that are in issue in the present proceedings, are extracted hereinbelow:- Claim No. Description of Claim Amount 2(a) Claim on account of extra Cost on increased Establishment Cost including Overheads, Salary of Regular and Contractual Staff, Inspection Vehicle hire Charges, etc. due to prolongation of contract Rs. 6,05,50,281.00 2(b) Claim on account of extra cost due to payment of bank charges for repeated extension of Performances Bank Guarantee beyond stipulated completion date Rs. 43,035.00 2(c) Claim on account of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eports whereby the Contractor was repeatedly informed about the shortage of manpower and material on the Project site. The EOTs were granted without imposition of liquidated damages and with payment of price escalations in terms of Clause No. 11.1.3 of Special Conditions of Contract (hereafter, SCC ). Insofar as the aspect of the design was concerned, DMRC contended that the same was, as per clause 5.1 of General Conditions of Contract (hereafter, GCC ), within the scope of the work awarded to the Contractor. The design was to be in conformity with the criteria of fastening system laid down by the Ministry of Railways which formed part of the Contract. The design proposed by the Contractor was subject to approval by the Engineer/Employer, who could propose changes thereto as per the requirement of the overall design. It was contended that the change in design sought by the EIC was attributable to the Contractor. DMRC also challenged the variation of quantity of work under Item 8 of BOQ pertaining to Supply of Track Fitting . It was contended that the BOQ rate for Item 8 were neither sought for by DMRC on the basis of number of bolts nor the same was quoted by the Contractor. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hus the claim for compensation with respect to those 12 months was rejected. However, considering the period of six months under the third EOT i.e., from 01.01.2018 to 30.06.2018, AT awarded proportionate amount under sub-claim Nos.2(a), (b) and (c). AT did not find any merit in the claims for loss of profit and extra cost claimed due to depreciation under sub-claim Nos.2(d) and (e). In concluding so, AT noted that the Contractor did not provide any cogent evidence for them. 8. Claim Nos.3 and 4 were taken up together for consideration as both pertained to Ballastless Track Fastening System. Claim No.3 related to change in design and Claim No.4 related to abnormal variation in the quantity of Ballastless Track Fitting System. AT observed that the claims related to deviation in quantity of Item No. 8 in BOQ. AT observed that under Clause 5.1 of the Contract, the design was in Contractor s scope, who was obligated to submit the same in accordance with Clause 6.3.2 of the Contract. The first technical design submitted by the Contractor on 03.06.2015 was found to be technically deficient with number of non-compliance issues as indicated by DMRC in its letter dated 08.06.2015 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Award holding the Contractor entitled for a sum of Rs. 3,93,03,109/- towards various claims along with interest @10% per annum on the awarded sum from the date of the Award till payment. 10. DMRC has not challenged the Award and the entire award amount has been paid to the Contractor. SUBMISSIONS BEFORE THIS COURT 11. It was contended on behalf of the Contractor that the partial rejection of Claim No. 2 by AT suffers from patent illegality, inasmuch, AT while limiting the compensation to six months, returned a perverse finding that in seeking EOT on the first, second and fourth occasion, the Contractor had not reserved its right to seek compensation, which amounted to a waiver. AT wrongly relied only upon Section 55 of the Indian Contract Act, 1873 (hereafter, ICA ) instead of reading it in conjunction with Section 73, ICA. The rejection of Claim Nos. 3 and 4 is also hit by the vice of patent illegality. AT overlooked that the insistence of DMRC to use four bolts instead of two on certain curves was in departure from International and National practice. Further, AT failed to appreciate that Clause at S. No. 31 of SCC had replaced the earlier Clause No. 12.5(ii)(f). Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. Also, consideration of documents which are not supplied to the other party is a facet of perversity falling within the expression patent illegality . 14. Through Claim No. 2, Contractor had claimed extra cost incurred due to prolongation of the project. As noted above, the Contract was delayed by 18 months for which, Contractor had sought four EOTs by way of four letters namely 17.02.2017, 12.10.2017, 26.12.2017 and 23.08.2018, which were granted by the DMRC. 15. Pertinently, DMRC granted EOT on all the four occasions without imposing any liquidated damages. Indisputably, the Contractor reserved its right to seek compensation only at the time of seeking third EOT vide its letter dated 26.12.2017, and in the earlier requests it did not claim any monetary compensation due to the extensions. 16. AT declined to compensate the Contractor for the remaining 12-month period holding that the Contractor had accepted EOT granted by DMRC without compensation and no right to claim the same was reserved by the Contractor, unlike the third EOT sought for the period 01.01.2018 to 30.06.2018. According to the Contractor, the AT committed a judicial error amounting to patent illegalit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ming to Claim Nos.3 and 4, the same relate to deviations in the quantity of Item No. 8 of BOQ which read as under: Item 8 Supply of Track Fitting Item No. Description of Items Unit Total Quantity Rate in Indian Rupees (INR) Rate in Foreign Currency Amount in Indian Rupees (INR) Amount in Foreign Currency 8. Supply of Track Fittings Item 8.1 for Straight Track curve having radius flatter than 1750m Item No. Description of Items Unit Total Quantity Rate in Indian Rupees (INR) Rate in Foreign Currency Amount in Indian Rupees (INR) Amount in Foreign Currency 8.1 For Straight Track curve having radius flatter than 1750m Set 160000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nveyed to the Contractor vide its letter dated 08.06.2015. It is observed by AT in the award that the Contractor did not challenge DMRC s comments on the design submitted by it and on its own re-submitted a new bolt calculation on 19.09.2015. 23. Be that as it may, the rates quoted in Item 8 of the BOQ are for quantities that are measured in metre length of the track of various radii. The quantities of individual items of the track fitting system was neither sought for by DMRC in the BOQ nor quoted by the Contractor when they submitted their rates. It would not have been possible for the AT to order variation in quantities on account of increase in the number of bolts installed, due to the design change, as was claimed by the Contractor, since, the same may have been contrary to the BOQ. In any case, the AT has dealt with the claim in a judicial manner, referring to the contract provisions and the evidence produced by the parties. 24. At the cost of repetition, it is never enough to reiterate that under Section 34, the Court is not called upon to reappreciate evidence or correct the legal errors that the AT may have committed in appreciating the evidence or interpret the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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