# Hindustan Steelwork Construction Ltd v. NOIDA

- **Citation:** (2023) 10 ILRA 551
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-09-22
- **Case number:** Act 1996 No. 219 of 2022
- **Bench:** Manoj Kumar Gupta, Vikram D. Chauhan
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/hindustan-steelwork-construction-ltd-v-noida-49480
- **Pages:** 9

## Headnote

Law
-
Commercial
Courts,
Commercial Division and Commercial
Appellate Division of High Courts Act,
2015 - Section 13 - Arbitration and
Conciliation Act, 1996 - Sections 32, 34
& 37 - Appeal against award - Scheme
of Act does not put any limitation on
court
from
applying
doctrine
of
severability to arbitral award while
deciding objections under Section 34 -
Court may sever, segregate and set
aside part of arbitral award while
upholding rest, provided (i) it does not
modify arbitral tribunal's findings and
(ii) surviving portion is self-sustaining
- Claim No. 2 for ₹35.92 crores towards
liquidated damages under Clause 13(ii)(b)
of GCC has been found unsustainable and
is distinct from other valid and lawful
claims - As these valid claims can stand
independently, without in any manner
affected by severance of Claim No. 2
towards liquidated damages - Applying
doctrine
of
severability,
only
award
relating to Claim No. 2 and its associated
pendente lite and future interest is set
aside - Rest of award remains intact. (Para
146, 147)

Appeal partly allowed. (E-13)

List of Cases cited:

## Text

10 All. Hindustan Steelwork Construction Ltd. Vs. NOIDA
551
award dated 26.9.2022 passed in Case No.
1689 of 2017 relating to Chandra Kishori
and award in Case No. 1690 of 2017
relating to Om Prakash is also set aside.

33. The Arbitrator shall re-determine
the compensation afresh in light of the
observations made by this Court including
taking note of the evidence already
produced and placed on record by the
parties in light of the provisions
contained under Section 3-G(7) of the
NHAI Act, 1956 read with Section 26
and
28
of
the
Right
to
Fair
Compensation and Transparency in
Land Acquisition, Rehabilitation and
Resettlement Act, 2013 expeditiously as
possible and preferably within a period
of six months from the date a copy of
this
order
is
placed
before
the
authorities concerned. It is clarified that
the appellants shall not be permitted to
lead any fresh evidence. Subject to the
above observations, both the appeals
are
allowed.
In
the
facts
and
circumstances of the case, there shall no
order as to costs.

34. The record of the court below
be returned forthwith.
----------
(2023) 10 ILRA 551
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 22.09.2023

BEFORE

THE HON'BLE MANOJ KUMAR GUPTA, J.
THE HON'BLE VIKRAM D. CHAUHAN, J.

Appeal U/S 37 of Arbitration & Conciliation
Act 1996 No. 219 of 2022

Hindustan Steelwork Construction Ltd.
 ...Appellant
Versus
NOIDA ...Respondent

Counsel for the Appellant:
Sri Varad Nath, Agarwal Archi Piyush, Sri
Pranay Agarwala, Sri Amit Saxena (Sr.
Advocate)

Counsel for the Respondent:
SriKaushalendra Nath Singh, Ms. Anjali
Goklani, Sri Manish Goyal (Sr. Advocate)

Civil
Law
-
Commercial
Courts,
Commercial Division and Commercial
Appellate Division of High Courts Act,
2015 - Section 13 - Arbitration and
Conciliation Act, 1996 - Sections 32, 34
& 37 - Appeal against award - Scheme
of Act does not put any limitation on
court
from
applying
doctrine
of
severability to arbitral award while
deciding objections under Section 34 -
Court may sever, segregate and set
aside part of arbitral award while
upholding rest, provided (i) it does not
modify arbitral tribunal's findings and
(ii) surviving portion is self-sustaining
- Claim No. 2 for ₹35.92 crores towards
liquidated damages under Clause 13(ii)(b)
of GCC has been found unsustainable and
is distinct from other valid and lawful
claims - As these valid claims can stand
independently, without in any manner
affected by severance of Claim No. 2
towards liquidated damages - Applying
doctrine
of
severability,
only
award
relating to Claim No. 2 and its associated
pendente lite and future interest is set
aside - Rest of award remains intact. (Para
146, 147)

Appeal partly allowed. (E-13)

List of Cases cited:

1. M/s Classic Motors Ltd. Vs Maruti Udyog Ltd.,
1997 (40) DRJ

2. Central Inland Water Transport Corp. Ltd. Vs
Brojo Nath Ganguly, 1986 (3) SCC 156

3. Balaji Pressure Vessels Ltd. Vs Bharat
Petroleum Corp. Ltd, 2014 SCC OnLine, Bombay
1079
552 INDIAN LAW REPORTS ALLAHABAD SERIES
4. Government of Andhra Pradesh Irrigation
Department Vs G. Kondala Rao, (2004) 1 An WR
526 (WB)

5. Dakshin Haryana Bijli Vitran Nigam Ltd. Vs
M/s Navigant Technologies Pvt. Ltd, 2021 (7)
SCC 657

6.
McDermott
International
Inc
Vs
Burn
Standard Co. Ltd., (2006) 11 SCC 181, (Paras
52, 68)

7. Ssangyong Engineering and Construction
Company Ltd. Vs National Highways Authority of
India (NHAI), (2019) 15 SCC 131

8. ONGC Ltd. Vs Western Geco International
Ltd, (2014) 9 SCC 263

9. Delhi Airport Metro Express Pvt Ltd Vs Delhi
Metro Rail Corp. Ltd, (2022) 1 SCC 131, (Para
29)

10. Municipal Corp. of Delhi Vs Jagan Nath
Ashok Kumar & anr., (1987) 4 SCC 497

11. St. of Jharkhand & ors. Vs HSS Integrated
SDN & anr., (2019) 9 SCC 798

12. NHAI Vs Progressive -NVR (JV), (2018) 14
SCC 688

13. Maharashtra St. Electricity Distribution Co.
Ltd. Vs Datar Switchgear Ltd, (2018) 3 SCC 133

14. Atlas Express Ltd. Vs Kafco (Importers &
Distributors) Ltd, QBD (1989) 1 All ER 641

15. Pao On& ors. Vs Lau Yiu Long & ors., 22 (1979) 3
All ER 65 (PC)

16.
Gas
Authority
of
India
Ltd
Vs
IndianPetrochemicals Corp. Ltd & ors., (2023) 3 SCC
629

17. Kalpraj Dharamshri & ors. Vs Kotak Investment
Advisors Ltd. & ors., 2021 (10) SCC 401

18. National Insurance Comp. Ltd. Vs Boghara
Polycab Pvt. Ltd., (2009) 1 SCC 267

19. K. Ramachandra Rao Vs U.O.I. & ors., 1994 Supp
(2) SCC 545 (2)
20. Supermint Exports Pvt. Ltd. Vs New India
Assurance Comp. Ltd. & ors., 2021 SCC OnLine Del
5237

21. New India Assurance Comp. Ltd. Vs Khanna
Paper Mills Ltd., (2022) SCC OnLine Del 4269, (Para
81)

22.
Associated
Constructions
Vs
Pawanhans
Helicopters Pvt. Ltd, 2008 (16) SCC 128, (Paras 26,
27, 30)

23. Unikol Bottlers Ltd. Vs Dhillon Kool Drinks, 1994
(28) DRJ 483

24. Sara International Ltd. Vs Rizhao Steel Holding
Comp. Ltd., 2013 SCC OnLine 2236

25. NTPC Ltd. Vs SPML Infra Ltd., 2023 SCC OnLine
SC 389, (Paras 47, 48)

26. Vidya Drolia & ors.Vs Durga Trading Corp.,
(2021) 2 SCC 1

27. Kinnari Mullick & anr. Vs Ghanshyam Das Damini,
(2018) 11 SCC 328, (Paras 15, 16)

28. Project Director, National Highways No.45 E and
220 National Highways Authority of India Vs M.
Hakeem & anr., (2021) 9 SCC 1, (Paras 19 to 22)

29. National Highways Authority of India Vs P.
Nagaraju @ Cheluvaiah & anr., 2022 SCC OnLine SC
864, (Para 26)

30. Secretary to Govt. Department of Education
(Primary) & ors. Vs Bheemesh Alias Bheemappa,
2022 AIR (SC 402)

31. R.S. Jiwani (M/s.) Mumbai Vs. Ircone
International Ltd. Mumbai, 2009 SCC OnLine
Bom 2021, (Paras 30 to 32, 35, 37)

32. J.G. Engineers Pvt. Ltd. Vs U.O.I. & anr.,
(2011) 5 SCC 758

33. National Highways Authority of India Vs The
Additional Commissioner, Nagpur & ors., 2022
(5) AIR Bom R 562, (Para 22)

34. John Peter Fernandes Vs Saraswati, 2023
SCC OnLine Bom 676, (Para 16)
10 All. Hindustan Steelwork Construction Ltd. Vs. NOIDA
553
(Delivered by Hon'ble Manoj Kumar
Gupta, J.)

1. The instant appeal has been filed
under Section 13 of the Commercial
Courts,
Commercial
Division
and
Commercial Appellate Division of High
Courts Act, 2015 read with Section 37 of
the Arbitration and Conciliation Act, 1996
(for the sake of brevity hereinafter referred
to as 'the Act') challenging the order of the
Commercial Court, Gautam Budh Nagar
dated 23.5.2022 in Arbitration Case No. 13
of 2015, setting aside the Arbitral Award
dated 15.12.2014, by the Sole Arbitrator, in
a dispute between the parties.

BACKGROUND

2. In the year 2002, the New Okhla
Industrial
Development
Authority
(NOIDA), the respondent herein, entered
into negotiation with U.P. State Bridge
Corporation Limited for construction of
two flyovers with clover leaves and allied
work at M.P. Road No.3 Express Highway
near Amity School and at T-junction near
Film City, Gautam Budh Nagar. It
submitted a proposal of Rs.106.10 crores
for execution of the Project on turnkey
basis, including centage charges but which
was not accepted.

3. The appellant herein, i.e.
Hindustan Steel Works Construction
Limited (HSCL), is a Government of
India Undertaking, registered under the
Companies Act, 1956. It also gave
proposal to NOIDA to execute the
Project at the same cost of Rs.106.10
crores. The offer of HSCL was accepted
by NOIDA and the parties entered into
a formal contract- a Memorandum of
Understanding (MoU) on 27.03.2003.
The work under the contract was to be
completed by the HSCL within 27
months from the date of start, which
was to be counted from 30 days after
the receipt of deposit advance from
NOIDA or from the date of possession
of land, which ever is earlier. The
HSCL
was
obliged
to
submit
performance security equivalent to 5%
of the contract value in shape of bank
guarantee. NOIDA was under obligation
to pay interest free deposit advance of
15% of project cost secured by the bank
guarantee (excluding centage charges)
within thirty days from the date of
award of work. The advance so paid
was to be adjusted in the subsequent
demand of funds on the basis of actual
work
executed
by
HSCL.
The
subsequent demand was to be submitted
after utilization of 75% of the deposit
advance released as above. Under
Clause 7, HSCL was entitled to price
variation in cost of building material as
per NHAI guidelines and formula for
computing the same was provided for in
the General Conditions of Contract
(GCC) executed between the parties in
addition
to
the
MoU.
Clause
11
stipulated
that
if
the
work
is
temporarily suspended due to any
reason which is not attributable to
HSCL, suitable extension of time shall
be granted by the NOIDA on the
request of HSCL. In case the work is
delayed due to reasons attributable to
HSCL, it was made liable to penalty at
the rate of 5% per month of centage
charges to NOIDA. The period for
which extension would be granted is
provided in the GCC. The GCC also
provided for compensation to HSCL in
case of suspension of work exceeding 30
days in certain circumstances. Clause 14
made the agreement irrevocable till the
expiry of defect liability period unless there
554 INDIAN LAW REPORTS ALLAHABAD SERIES
has been breach of any terms and
conditions
of
the MoU.
Clause
22
contained
an
arbitration
clause
for
resolution
of
disputes
or differences
between the parties, arising out of the
contract. It reads thus: -

"In the event of any question, dispute
or difference not being settled in between
the parties the matter shall be referred to
Chairman/C.E.O. NOIDA for nominations
of an arbitrator, whose decision shall be
final and binding on the both of the
parties."

4. The General Conditions of Contract
(GCC)
contained
specific
provisions
relating to - Extension of Time (Clause 2);
Interest Free Mobilization of Advance
(Clause 7B); Payment due to increase/
decrease in prices (Price Escalation) after
receipt of contract for works and the
manner of calculation thereof (Clause 8);
Foreclosure
of
Contract
Due
to
Abandonment or Reduction in Scope of
Work (Clause 11); Cancellation of Contract
in Full or Part (Clause 12); Suspension of
Work and payment of compensation to the
contractor in cases where such suspension
is not attributable to any default on part of
the contractor (Clause 13) etc.

5. In terms of the agreement, HSCL
started work since 7.04.2003.

6.

On
6.09.2003,
the
State
Government
directed
for
holding
of
enquiry, suspecting that contract value was
highly inflated. On 19.09.2003, the NOIDA
addressed a communication to HSCL
informing it that a Review Committee had
been constituted by it to review the cost of
the project. HSCL was required to submit
all drawings and other relevant details
before the said Committee. It was also
directed to slow down the project till it is
cleared by the Review Committee.

7. It seems that thereafter the Review
Committee got the costing done by M/s
SOWil Limited, a project planning and
appraisal company and Indian Institute of
Technology (IIT) Delhi. According to the
report of M/s SOWil, the cost was on
higher side by around 40 crores. The report
of IIT, assesses the costing to be inflated by
60 crores. Consequently, on 22.09.2003,
the appellant was directed to stop all work
with immediate effect. The work, therefore,
came
to
a
standstill
and
remained
suspended for 928 days.

8. Under Clause 13 (iii) of GCC, if
work remains suspended for more than four
months, HSCL had the option to treat it as
'foreclosure of contract' under Clause 11 of
GCC and thereby entitling it to payment for
the work already executed, cost of building
material lying at the construction site or its
stores
and
reasonable
compensation.
NOIDA would not be entitled to recovery,
if any done against Mobilisation Advance.
Any retention money held had to be
released. All Bank Guarantees would stand
discharged forthwith.

9. However, HSCL chose not to
invoke Clause 11 of GCC and it continued
to negotiate with NOIDA for resumption of
work. Series of meetings were held
between the parties. NOIDA insisted on
revision of rates, but which was not agreed
to by HSCL.

10. The Chief Executive Officer,
NOIDA
in
a
communication
dated
12.10.2004
addressed
to
the
Special
Secretary, U.P. Government, Lucknow
disclosed that NOIDA had taken legal
advice, according to which it would be
10 All. Hindustan Steelwork Construction Ltd. Vs. NOIDA
555
exposed to monetary claim of damages,
besides cost escalation, in case the contract
is terminated and that would not be in the
public interest and therefore it should make
effort for a negotiated settlement with
HSCL. It was also brought to the notice of
the Government that HSCL was, by that
time, paid Rs.49.98 crores and according to
report of experts, the value of work
executed was Rs.20 crores only. Thus,
there was excess payment of around Rs.30
crores.
Therefore,
he
suggested
that
NOIDA should be permitted to proceed
with the contract, subject to re-negotiation
of price and HSCL agreeing to the
amendments in the original contract.

11. In response, the State Government
by letter dated 11.03.2005 permitted
NOIDA to go ahead with the contract,
subject to re-negotiation of the terms of
MoU
to
make
the
contract
value
competitive.

12. According to HSCL, at that time,
it was under acute financial distress
because of abrupt suspension of work. It
was unable to meet its financial obligations.
It therefore agreed to give up its right to
claim damages and price escalation during
the period work remained suspended by its
letters dated 29.04.2005 and 10.05.2005.

13.

The
parties
executed
a
Supplementary MoU dated 22.03.2006.
The
letters
dated
29.04.2005
and
10.05.2005 of HSCL, wherein it agreed to
forego its claim towards damages and price
escalation during the period contract
remained suspended, were made part of the
Supplementary MoU. The Supplementary
MoU stipulated that the appellant would
complete the project at the original cost of
Rs.106.10
crores
and
not
claim
compensation and price escalation on
account of suspension of work.

14.

The
parties
signed
the
Supplementary MoU on 22.03.2006 and the
contract period was extended. The parties
also agreed that subject to any contrary
term in the Supplementary MoU, the
provisions contained in the earlier MoU
would continue to govern the rights of
parties.

15. On 8.04.2006, HSCL recommenced the work at the site and
completed the work on 30.04.2008.

16. On 25.02.2008, just before
completion of work, HSCL made claims
towards price variation under Clause 8 of
GCC. It referred to Clause (1) of
Supplementary MoU in contending that
Clause 8 of GCC would not stand
suspended by execution of Supplementary
MoU. It was emphasised that HSCL only
waived price escalation during suspension
period. The price escalation provision for
the period after recommencement of work
remained binding on the parties and
therefore NOIDA should honour its claim
towards
price
escalation.
Again
on
10.04.2008,
HSCL
send
another
communication to NOIDA, emphasising
that price escalation Clause 8 of GCC
remained suspended as per terms of
Supplementary MoU only during period of
suspension of work. It would stand revived
for the period post recommencement of
work. Therefore, its bills towards price
escalation for the said period be honoured
forthwith. To the same effect were the
letters dated 23.05.2008 and 16.09.2008.

17. It is noteworthy that during all
this period, HSCL never made any claim
towards damages on account of suspension
556 INDIAN LAW REPORTS ALLAHABAD SERIES
of work, either under Clause 13(ii)(b) of
GCC nor under any other provisions of the
Contract being conscious of the fact that
vide Clause 3 of Supplementary MoU, it
had agreed to forego all claims in respect
thereof.

18. However, vide a letter dated
16.02.2009,
almost
one
year
after
completion of work, HSCL made a claim
of Rs.37.12 crores towards damages during
suspension period relying on Clause
13(ii)(b)
of
GCC.
It
also
claimed
Rs.23.9420 crores towards price escalation
for the period - prior to and post
recommencement of work and Rs.42.00
lakhs towards extra work, apart from
interest i.e. total sum of Rs.76.8316 crores.
HSCL also invoked Clause 22 of the MoU
dated 27.03.2003 and requested NOIDA to
refer the dispute to arbitration. It made the
same request vide letter dated 20.03.2009.
However,
NOIDA
vide
letter
dated
17.06.2009 rejected all the claims relying
on Clause 3 of the Supplementary MoU
and refused to refer the matter to
arbitration.

REFERENCE TO ARBITRATOR

19. On 7.9.2009, HSCL approached
this Court under Section 11 of the Act for
appointment of arbitrator. In para 9 of the
said application, HSCL for the first time
alleged undue influence and coercion on
part of NOIDA in obtaining Supplementary
MoU containing clause relating to waiver
of
the
right
of
HSCL
to
claim
damages/liquidated damages under Clause
13(ii)(b) of GCC during the suspension
period. It also raised other claims. This
Court
allowed
the
application
under
Section 11 of the Act and referred the
matter to a sole arbitrator.

ARBITRATION PROCEEDINGS

20. HSCL filed its Statement of Claim
(SOC) before the Arbitral Tribunal under
nine different heads. There were two major
claims. The first major claim (Claim No.1)
of Rs.23.9420 Crores was in respect of
escalation of price while work was in
progress i.e. excluding the period when
work remained suspended. It was based on
Clause 7 of MoU read with Clause 8 of
GCC. The other major claim was Claim
No.2 towards damages allegedly suffered
on account of suspension of work. The said
claim was based on Clause 13(ii)(b) of
GCC for a sum of Rs.35.92 Crores. The
detail of all the claims is as follows :-

Claim
Head of Claim Amount
Claimed
Claim 1 On account of
Price Variation
Rs.
2394.20
Lakhs
Claim 2 On account of
Suspension
of
Work
Rs.
3592.00
Lakhs
Claim 3 On account of
delayed
payment IRA 3
and 4
Rs.
388.68
Lakhs
Claim 4 Damages
on
account of extra
Bank Guarantee
Charges
Rs.
27.44
Lakhs
Claim 5 Damages
on
account
of
expected loss of
profit
Rs.
1060.00
Lakhs
Claim 6 On account of
cost
of
Arbitration

Rs. 25 Lakhs
10 All. Hindustan Steelwork Construction Ltd. Vs. NOIDA
557
Claim 7 On account of
Interest
Rs.
5666.34
Lakhs
Claim 8 On account of
Pendente
lite
Interest
12%
on
Awarded
Amount
Claim 9 Extra items of
work
Rs.
36.18
Lakhs
Claim1
0
On account of
Final Bill
Rs.
48.85
Lakhs
TOTA
L

9677.61
Lakhs

21. The NOIDA denied the claims of
HSCL by filing Statement of Defence
(SOD). It specifically pleaded therein that
the claims relating to escalation/price
variation (Claim No.1) and compensation
owing to suspension of work (Claim No.2)
are not sustainable in view of HSCL having
unequivocally agreed to forego these
claims during process of re-negotiation and
also while entering into the Supplementary
MoU. It also pleaded that HSCL had not
alleged any coercion or duress at the time
of entering into Supplementary MoU nor
till the completion of work in pursuance of
Supplementary MoU. The plea of duress
and coercion was taken for the first time
before
the
arbitrator
and
thus
not
sustainable in law. It contended that in a
commercial bargain, plea of coercion and
duress is unsustainable, particularly in the
instant case, where HSCL is a Government
of India Undertaking and had at its disposal
best of legal advise and also the option to
treat the suspension of work to be
foreclosure of contract and in which event,
it would have been paid value of the work
executed and other amounts as envisaged
under Clause 11 of GCC.

22. The parties filed documentary
evidence and also various affidavits in
support of their respective cases. By order
dated 17.05.2012, the Arbitral Tribunal
permitted the parties to lead oral evidence,
but no oral evidence was led by any party.
The tribunal framed as many as twenty (20)
issues. It ultimately passed a final award on
15.12.2014 in favour of HSCL awarding a
sum of Rs.97.10 crores, inclusive of the
cost of arbitration, alongwith pendente lite
and future interest.

23. The issues framed by the Arbitral
Tribunal are as follows:-

1. Whether the purported question,
dispute
and
or
difference
regarding
execution of Supplementary MOU is
immoral,
one
sided,
wholly
unconscionable, unilateral, induced by
'Undue Influence', obtained under duress,
without free will and consent, under
coercion etc. as contained in paragraphs 7
and 8 of the Statement of Facts and Claims
is the subject matter of reference to
arbitration before the arbitral Tribunal for
adjudication?

2. Whether the arbitral Tribunal has
jurisdiction to decide and declare the
validity of Supplementary MOU in view of
allegations of coercion, duress, undue
influence etc.?

3.
Whether
the
Supplementary
Memorandum of Understanding is vitiated
by the purported contentions of coercion,
duress,
undue
influence,
economic
pressure, immoral and unreasonable?

4. Whether the Claimant's proposal of
Rs. (sic Rest.) 106,09,91,236/- for the
Work was accepted by the Respondent on a
lump sum turnkey basis?

5. Whether the GCC are the part of the
Claimant's proposal or the Respondent's
letter of acceptance and or the MOU or the
Supplementary MOU?
558 INDIAN LAW REPORTS ALLAHABAD SERIES

6. Whether the purported claims of the
Claimant are barred by limitation?

7. Whether the Claimant had made a
request for foreclosure of contract?

8. Whether the Claimant offered and
agreed to continue left over work on grant
of extension of time at a fixed cost of Rs.
106.10 crores?

9. Whether the Claimant agreed not to
pursue its claims pertaining to escalation
and compensation due to suspension of
Work?

10. Whether the suspension of Work
was due to reasons beyond the control of
New
Okhla
Industrial
Development
Authority?

11.
Whether
the
Claimant
has
complied the pre-requisite conditions in
respect of the purported disputes before
seeking reference to the arbitration.

12. Whether the costing/ estimation
done by IIT, Delhi for referred in
Reports/Letters is acceptable or not?

13. Whether the Claimant is entitled to
an amount on account of price variations?
If so, what amount?

14. Whether the Claimant is entitled to
an amount on account of Clause 13(b) of
GCC? If so, what amount?

14 (A). Whether the Claimant is
entitled to any amount on account of
nonpayment of 4" RA Bill in time? If so
what amount.

15. Whether the Claimant is entitled to
damages on account of extra Bank
guarantee charges? If so, what amount?

16. Whether the Claimant is entitled to
damages on account of loss of profit? If so,
what amount?

17. Whether the Claimant did extra
items? If so, what are such items and what
amount the Claimant is entitled in respect
thereof.

18. Whether the claim for extra items
is maintainable? If so, what amount the
Claimant is entitled.

19. Whether the Claimant is entitled
on account of final bill? If so, what
amount?
20. Whether the Claimant is entitled to
interest? If so, what amount and at what
rate and for what period.

23 (a). Issues no.1, 2 and 3 were
decided together. The tribunal held that the
issue relating to undue influence and
coercion was well within the scope of
reference; that it had jurisdiction to decide
the validity of Supplementary MoU on
basis of allegations of coercion, duress and
undue influence and that duress and undue
influence was played upon HSCL in
obtaining Supplementary MoU, NOIDA
being in a dominating position.

23 (b). Issue no.4 was decided in
favour of HSCL and it was held that the
contract price was lumpsum amount of
Rs.106,09,236/- plus price variation as per
the contract.

23 (c). Issue no.5 has also been
decided in favour of HSCL and it is held
that GCC was integral part of the main
contract.

23 (d). The plea of NOIDA relating to
the claims being barred by time was
decided vide Issue No.6. The plea was
repelled and it was held that HSCL had
invoked the arbitration clause well within
three years and therefore the claims were
not barred by time.

23 (e). Issue no.7 was decided in
favour of HSCL.

23 (f). Issue no.8 was decided in
favour of HSCL and it is held that the term
"fixed cost" is referable to the originally
agreed amount and does not preclude the
claim in respect of price variation etc. in
10 All. Hindustan Steelwork Construction Ltd. Vs. NOIDA
559
accordance with the MoU, GCC and
Supplementary MoU.

23 (g). Issue no.9 has been decided in
favour of HSCL and it has been held that
Clause 3 of the Supplementary MoU
prohibited claim in respect of escalation
and compensation only from 22.9.2003 till
recommencement of the work. It did not
preclude HSCL from making claim in
respect
of
compensation/escalation
subsequent to re-commencement of the
work.

23 (h). Issue no.10 as to whether
suspension of work was due to reasons
beyond control of NOIDA, was decided
against NOIDA holding that it was
responsible for unnecessarily holding up
the work for a period of 928 days.

23 (i). Issue no.11 has been decided in
favour of HSCL holding that the claimantappellant had complied with the prerequisite
conditions
before
seeking
reference to the arbitration.

23 (j). Issue no.12 as to whether
costing/estimation
done
by
IIT,
was
acceptable or not, has been decided in
favour of HSCL.

23 (k). Issue no.13 related to claim in
respect of price variation - post recommencement of the work. The tribunal,
after considering various clauses of the
MoU, GCC and Supplementary MoU made
distinction between claim in respect of
price variation and compensation under
Clause 13(ii)(b) of GCC. It held that Price
Variation Clause in the original MoU
(Clause 7) and GCC (Clause 8) remained
eclipsed only during work suspension
period. Post recommencement of work,
these clauses revived, and the claim of
Rs.23.94 crores towards price variation -
post recommencement of work, was fully
admissible and was allowed.

23 (l). Issue no.14 in respect of
damages @ Rs.4 lakh per day during work
suspension period has been decided in
favour of HSCL and a sum of Rs.35.92
crores has been awarded as liquidated
damages under Clause 13(ii)(b) of GCC.

23 (m). Issue no.14-A related to award
of interest on account of late payment of
4th RA bill. It has been decided in favour
of HSCL and a sum of Rs.1.66 crores has
been awarded in its favour.

23 (n). Issue no.15 relating to claim on
account of extra bank guarantee charges
was rejected.

23 (o). Issue no.16 relating to claim
for damages on account of loss of profit has
been rejected.

23 (p). Issues no.17 and 18 pertaining
to claim in respect of extra work have also
been decided against HSCL.

23 (q). Issue no.19 has been decided in
favour of HSCL and it has been awarded
Rs.48.85 lakhs towards final bill.

23 (r). Issue no.20 has been decided in
favour of HSCL and it is held that HSCL is
entitled to pendente lite and future interest
on the sums awarded.

24. Claim No.1 - towards price
escalation has been dealt with under Issue
No.13. It has been decided in favour of
HSCL. The other major Claim No.2 -
towards damages @ Rs.4 lakh per day for
the period work remained suspended, also
decided in favour of HSCL, is covered
under Issues No.1, 2, 3 and 14.

PROCEEDINGS
BEFORE
COMMERCIAL COURT (Sec. 34 of the
Act)

25. NOIDA, feeling aggrieved by the
award, filed objections under Section 34 of
the Act before the Commercial Court,
Gautam Budh Nagar, which has been
allowed by the impugned order dated
23.05.2022.