BEFORE THE ARBITRAL TRIBUNAL OF Shri K.K. Verma Shri. V.D. Gautam Shri. S.K. Jain In the matter of Arbitration between: M/s.

MBL Infrastructures Limited And National Highways Authority of India : Employer/Respondent : Claimant/Contractor … … … Presiding Arbitrator Arbitrator Arbitrator

In the matter of Arbitration under the provisions of Arbitration and Conciliations Act 1996 in “Short Term Improvement and Routine Maintenance work for Chilakaluripet to Vijayawada (Km. 355.00 to Km. 434.150) and Vijaywada to Eluru (Km.3.400 to Km. 81.600) Section of NH-5

INDEX S.No. DESCRIPTION 1 Statement of Defence of the Respondent incorporating amendments to the replies in respect of Claim Nos. A-1, A-5, A-6, A-7 & A-8 Filed by: RESPONDENT Through M. V. KINI & CO. Advocates & Solicitors KINI HOUSE 6/39, JANGUPRA B NEW DELHI – 110 014
Dated:

PAGE No. 1-

EMPLOYER/

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BEFORE THE ARBITRAL TRIBUNAL OF 1. Shri K.K. Varma, Additional Director General,(CPWD), Retd. EA-290, DDA-SFS Flats Maya Enclave, New Delhi-110064 Shri. V.D. Gautam IDSE, Retd. B-44, Jalvayu Vihar, Pocket 4, Plot # 8, Greater Noida 201308 Shri. S.K. Jain Jain-Lok, Kothi Gate, Hapur- 245101 : Presiding Arbitrator

2.

:

Arbitrator

3.

:

Arbitrator

IN THE MATTER OF ARBITRATION BETWEEN:M/s. MBL Infrastructures Limited 23A, N.S. Road, 3rd Floor, Room No.14, Kolkata AND NATIONAL HIGHWAYS AUTHORITY OF INDIA, G-5 & G-6, Sector – 10, Dwarka, New Delhi.

Claimant

Respondent

(ARISING OUT OF AGREEMENT DATED 24TH AUGUST, 2006) In the matter of Arbitration under the provisions of Arbitration and Conciliation Act, 1996 in “Short Term Improvement and Routine Maintenance work for Chilakaluripet to Vijayawada (Km. 355.00 to Km. 434.150) and Vijayawada to Eluru (Km.3.400 to Km. 81.600) Section of NH-5
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STATEMENT OF DEFENCE OF THE RESPONDENT INCORPORATING AMENDMENTS TO THE REPLIES IN RESPECT OF CLAIM NOS. A-1, A5, A-6, A-7 & A-8 MOST RESPECTFULLY SHOWETH: 1. That the contents of the SOC to the extent not specifically adverted to and replied herein shall be deemed to have been traversed in extenso and denied by the Respondent save and except those which are specifically admitted hereinafter.
2.

That wherever applicable, the Respondent has placed copies of correspondence/documents as annexure to the reply and reserves its right to rely on the same and further reserves the right to file such other correspondence/documents as may be deemed appropriate and to make detailed submissions at an appropriate time.

3.

That the Respondent reserves its right to add, to vary, modify or otherwise elaborate its reply, averments, contentions and submissions and to submit further documents as may be required. Further, the Respondent hereby reserves its right to lead oral as well as documentary evidence as may be required in support of its contentions. OBJECTIONS ON THE MAINTAINABILITY & ARBITRABILITY

That the Claimant has sought to make certain alleged claims before this Ld. Tribunal, which are either beyond the terms of the Contract or are clearly barred by the terms of the Contract and therefore are not maintainable or arbitrable, the details whereof are as under:
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iii) Claim No.towards loss of Goodwill. 33. A-8 Rs. A-7 Rs. That the present Contract was entered into between the Claimant and the Respondent for the purposes of “short term improvement and routine maintenance of NH-5 from Chilakaluripet to Vijayawada and Vijayawada to Eluru.towards loss due to prolongation of Contract period (Claim due to overheads and establishments).towards loss of profit due to reduction on account of Contract which could not be executed. As per the terms of the agreement. mental harassment etc. v) Claim No.2006 to 29.88. According to Clause 27. Reputation. ii) Claim No.17.94.15. 1.1. the Claimant was required to execute the work as mentioned in the “Scope of Works”. 5.00. This objection may kindly be treated to have been raised u/s 16 (2) of the Arbitration and Conciliation Act. A-6 Rs.07. 1996. A-1 Rs. Tribunal.00.i) Claim No.2006).803/. PRELIMINARY OBJECTIONS: 1. 18.978/..towards loss on account of delay in issue of letter to proceed (initial expenditure between 19.towards losses on account of price rise due to delays.74. iv) Claim No. the Engineer shall issue the Indents of the works in stages and the -4- .05.000/. 2. The aforesaid claims are clearly de hors the Contract and for the same reason not maintainable or arbitrable before this Ld.980/. A-5 Rs.08.788/.

1 of Part-I of GCC read with the Implementation Manual and Maintenance Intervention Levels (Section-6). along with monthly cash flow forecasts.08. The Contractor shall submit to the Engineer for approval a programme showing the general methods.10.72 of the Statement of Claim.08. 2. a review meeting was held.1 that the maintenance programme planning shall be in two stages.” Thus from the above it will be clear that the Claimant was to execute the works in accordance with the Indents issued to him by the Engineer from time to time within the time prescribed for completing the Indent.2006. On 09.Claimant shall submit the program to the Engineer for its approval.09. and timing for all the activities in the works.2006. The language of the Clause 27. After execution of the Contract dated 24. after the joint inspection and in consultation of the Claimant issued the First Indent to the Claimant. the Claimant failed to give any programme to the Respondent within the stipulated period of 28 days. the Letter to proceed with the work was issued by the Respondent to the Claimant on 29. a copy of which has been furnished by the Claimant as Document C-14 at pg. it is clearly laid down under clause 6.2006 the Engineer. order. which was represented by -5- . On 11. It is relevant to submit that in accordance with Clause 27.1 is reproduced herein below. and it is the primary responsibility of the Contractor to submit the first stage program within 28 days of issuance of the letter of commencement by the Employer. arrangements.3.2006. In spite of the said requirement under the Contract. “The Engineer shall issue the Indent of work in stages specifying the time limit for the same as and when required.

R-1 & R-2. the Claimant on his own admission had taken on lease an area of land measuring 3. 3. In the said meeting it was brought to the notice of the Claimant the poor rate of execution of the work.2006 Exhibit R-33.2007 whereas the work under the Contract had commenced on 12.2006 and 09.84 acres only on 19. after signing of the same.2006. Contrary to this.02. which will show that the Claimant initiated the breach of the Contract right from its inception. The copy of Claimant’s letter dt.11.the representatives of both the parties wherein it was pointed out to the Claimant that the scientific laboratory to carry out various tests had still not been established by the Claimant even though under Clause 53(i) read with Clause 15 (a) of the Contract. The claim of the Claimant that they had mobilized the heavy machinery and other staff and labour for commencement right from the beginning of June 2006 is totally bereft of any truth in as much as the Claimant has miserably failed to place any document in support thereof. As it transpired.01.09.09.09. That as a matter of fact the Claimant had failed to provide even the vehicles for routine maintenance and site management till as late as 18. the Claimant was bound to establish a fully equipped laboratory within a period of thirty days.2007 is appended hereto and marked as Exhibit R-41. it was pointed out that the Claimant had again failed to establish the laboratory. Claimant has to mobilize required machinery. As per conditions of the Agreement.10.11.2006 are annexed hereto and marked as Exhibit.2007. in as much as the Claimant had achieved only 5% against the required 67%. Copies of the minutes of the review meetings dated 09. the -6- .2006 and the Contract period was to end on 11. again in a Review meeting on 09. 05. Thereafter.

2006.3 of the Contract. Copies of some of the MOM’s and notices are appended hereto and marked as Exhibit -R-1 to R-6 as well as R-34 & R-35.2006 is annexed hereto and marked as Exhibit R4. It is pertinent to submit that the Claimant.12. the Respondent expressed concern over the non execution of the balance work in the First Indent. again during the review meetings held on.2006 and 09. That as already submitted no equipment/machinery whatsoever was available at site even after signing of the Contract to attend even ordinary / routine maintenance. 29.11.11.2006 and 18.39.2006 to the Claimant emphasized the need and the urgent requirement of the Hot Mix plant at the site.11.12. Copies of the minutes of the review meetings dt. copies whereof are appended hereto and marked as Exhibit R -36 to R.2006. 16. The Engineer again in letter dated 8.10.12.2006 are annexed hereto and marked as Exhibit.11.11. A bare perusal of the minutes of said meeting would reveal that the Claimant was unable even to start the work in terms of the provisions of the agreement. A copy of the letter dt.Claimant failed to do so in spite of a number of notices by the Engineer.2006. That That on 22.2006. 5.2006 and 09. -7- . Thereafter.R-5 & R-6.2006. a copy of whose minutes is appended hereto as Exhibit R-3.12. 29.2006 the Engineer placed the Second Indent on the Claimant.11.11. failed to install the Hot Mix plant despite notice in this behalf during the review meeting on 14. in gross violation of the requirement under Clause 6. 08. 04. 4.7. The failure of the Claimant in this regard and on various other issues was brought to the Claimant’s notice by the Consultant from time to time through his letters dated 07.

Thereafter.12. which was again not complied with by the Claimant. That it is submitted that the Claimant had continued with his lackadaisical approach in executing the work and submitted only a draft of the work program. which is extracted herein below.compliance of submission of Work Programme to the Engineer for approval as per the Contract. 2006.01. As per the above clause. 2006 (at the end of the first quarter).11.6.2007 (Document C-34 of the Statement Of Claim).3.2006. the Engineer further pointed out to the Claimant about his non-compliance with the requirement of Work Manual under Clause 6. pointed out to the Claimant his non. the Engineer made certain remarks vide letter dated 4th December. The Engineer in his letter dt. -8- . annexed hereto as Exhibit R-8 regarding yearly maintenance program. the Claimant is required to prepare a comprehensive document mentioning the assessment of various types of defects in each KM of road. “A comprehensive documentation shall be prepared separately by Engineer and Contractor mentioning their assessment of various types of defects in each km of road”. 2006 annexed hereto as Exhibit R-7 and gave a further reminder on 20th December.2006 and the same was received by the Engineer only on 30th December. 06. the Claimant resubmitted a back-dated work program on 11. that too belatedly after a delay of 70 days on 22. In the said letter.1(b)-(iii) under section 6 of the Contract. Since the work program was only in the form of draft.

7.12. 22. In the said letter.12. despite repeated notices and reminders of the Engineer/ Respondent on numerous occasions. 8.79% against the required 87.12. However. 18. Copies of some of the -9- . 04.2006.2006 (Exhibit R-9) the Respondent pointed out to the Claimant that despite repeated reminders through various letters and discussions in the monthly review meetings. 1 and the value of the works executed by the Claimant was a dismal 9.91% as per the approved Work Indent No. the said requests and entreaties fell on deaf ears in as much as there was no discernible improvement in the work performance of the Claimant. Again vide letter dt. That though the Claimant sought to furnish reasons for their various failures in a letter dt.2006 (Document C36 in the Statement Of Claim) requested the Claimant to expedite the work mentioned therein. the same were absolutely imaginary and unconvincing lame excuses. I/2006. the Claimant had failed to even complete the balance work under Indent No. Respondent vide its letter dt. The delay and dithering in the execution of the work led to numerous complaints from the Public regarding the deteriorating condition of the road owing to lack of maintenance and repairs. the Respondent also listed the failures of the Claimant in brief in executing various works. The Respondent through its letters from time to time had consistently apprised the Claimant regarding the complaints and emphasized the need for speed and expedition in the execution of the Work in a timely manner. The Respondent also sought the explanation from the Claimant as to why LD should not be levied. the Claimant exhibited lethargy in executing the work. That right from the date of commencement of work.

10. As if this was not enough. shrubs and similar plantation within the right of the way as per provisions of clause 4. 19.2007 Exhibit R-12 the Respondent informed the Claimant about non-compliance of various provisions of the Contract Viz.2007. manuring.2007 is annexed hereto and marked as Exhibit R-11. 3. deployment of qualified nursing staff. In the review meeting held on 09. but also miserably failed to fulfill the undertakings given by them in the .10 - .01. which fact was brought to the notice of the Claimant in a review meeting held on 19.1. The said incident of fire is a pointer to the gross neglect on the part of the Claimant in watering. the Claimant even failed to redevelop the lawn till 19. removal of hoardings. The callous attitude of the Claimant would be evident from the fact that instead of taking remedial steps as requested by the Respondent time and again through number of letters and reminders.04.04.04. deployment of Ambulances.complaints received from the Public are annexed hereto and marked as Exhibit R-10. the Claimant sought to disown their responsibility and resort to Arbitration proceedings.460 on Visakhapatnam side caught fire in the month of January 2007 despite the responsibility of the Claimant under the Contract to conserve all trees. The gross negligence on the part of the Claimant will be eloquent from the fact that the lawn in a traffic island around the Rotary at Km. trimming of the said area as per Contract in as much as the dry plantation became susceptible to fire.2.2007. 9. Not only did the Claimant fail to comply with the provisions of the Contract. A copy of the minutes of the review meeting dt.. submission of Monthly progress reports etc.

That as per the provisions of the Contract.2007.2007.02.02.3. the Ambulance services were operated without the qualified staff.2007 is annexed hereto and marked as Exhibit R-15.01.2007.11 - .88% against the targeted 35% until 31.2007 Exhibit R-16 it was observed by the Respondent that the Claimant was still to start execution of work under Indent No.02.13 & R-14. Furthermore. Again during the review meeting held on 9. 3. providing of mobile maintenance unit etc. However.2007. Copies of various letters on this subject from the Respondent to the Claimant are annexed hereto and marked as Exhibit -R. the due date in respect of which had already expired on 28. 12. the Claimant did not even commence the work against Indent No.02. A bare perusal of the various Minutes of the review Meetings will reveal that the Claimant had even failed to complete the First Indent in spite of the assurance that the same will be completed by 20.review meetings from time to time such as establishment of laboratory. despite several letters from the Respondent. till the date of termination of the Contract.03. 11. In the said meeting the Claimant was informed that the overall progress of the work was only 1. The Claimant was extremely lackadaisical in its approach in executing the work. From the above it will be evident that there was overall and comprehensive failure on the part of the Claimant in executing any . On 08. Apart from the non-completion of the First Indent. the due date of which was 28. the Claimant failed to establish the site laboratory.03. A copy of the minutes of the meeting dated 08.2007 a management meeting was held in the office of the Project Director. the Claimant was required to establish the fully operational laboratory within a period of 30 days.

In the said meeting the Claimant proposed non execution of certain BOQ items in view of a proposal for 6-laninig of the whole stretch of road between Chilakaluripet to Gundugolanu. by a letter dt. The Claimant further requested the Respondent to reduce the value of the work under the contract.24th May 2007 (Exhibit R-17) the Respondent conveyed the same to the Claimant. thus leaving no options to the Respondent except to levy Liquidated Damages on the Claimant as per terms of the Contract and accordingly. However. 14.2007 at NHAI Headquarters. The Claimant further made a request not to recover Liquidated Damages in the future bills citing cash-flow problems and further undertook to furnish an unconditional Bank Guarantee in lieu of Liquidated Damages until finalization of Extension of Time as well as the quantum of Liquidated Damages to be decided by the Respondent. Thereafter. in the month of June when the monsoon was already active. That a meeting was held on 29. the Claimant brought Hot Mix plant and Milling machinery to the site.12 - . That despite repeated promises to execute the work in terms of the Contract given during the various review meetings and in response to the numerous letters from the Respondent.08. the progress of work still remained dismal. no decisions were taken in respect of the Claimant’s proposals in the said meeting and no promise was held out to the Claimant regarding any reduction in the value of works or items except the subject of the bank guarantees to be provided by the Claimant and extension of .work as per the terms of the Contract and the untenable claims raised in the Statement of Claim are totally false and frivolous. the Claimant brazenly breached all such promises and undertakings. Notwithstanding this. 13.

44. was not approved by the Headquarters of the Respondent who returned the same with the remark that the same shall have to be submitted as per Clause 36. having regard to the scope of the Works and the sanctioned estimated cost.2007. have power to order only after approval from NHAI / as per NHAI guidelines.2007.09. in writing. in a bid to cover up his failures/ lapses unilaterally decided not to execute certain BOQ items on the excuse that the whole stretch of road between Chilakaluripet to Gundugolanu was proposed for six laning. “the Engineer shall.08.1 of Contract as a variation proposal. Variations within the scope of the Works he considers necessary or advisable during the progress of the works.38.10.69% vis-à-vis the requirement of 100% as on 11.31. which is self explanatory is appended hereto and marked as Exhibit R-18. Having failed to achieve the required progress in the work as scheduled. That the Respondent’s site inspection in the month of September revealed that the progress of work achieved by the Claimant till then was a dismal 12. .BG’s already provided. 15.13 - .” The above revised work programme. The Claimant.09. the Claimant submitted a revised work programme through a letter dated 10.19. It is a matter of record that no instructions whatsoever were issued by the Respondent or the Engineer to stop or suspend any work at any point of time.2007 unilaterally indicating a reduction in the scope of work under the Contract to Rs. As per Clause 36.60. Hence.117/-.65/. the revised work programme submitted by the Claimant is of no relevance contractually and the value of the work to be executed under the Contract remained as Rs. A copy of the Minutes of the Meeting dated 29.140.only.1 of Contract.

12. That on the request of the Claimant.2007 is annexed hereto and marked as Exhibit -R 19. the Respondent made it clear in the same letter that the LD already levied would continue to be recovered.10.2007.2007.6. The value of work executed by the Claimant was only Rs.72.141. 17.16. 10.9 and 3.70/against the agreement value of Rs.2007. 18. 3. the rate of execution of the works by the Claimant continued to remain tardy. the Claimant failed to appoint qualified nursing staff.28. a total of six (6) numbers of Indents were issued by the Engineer from time to time. vegetation and were unable to provide services of route petrol vehicles and the ambulances were being operated without the qualified staff. 3.2. The Claimant even resorted to false claims by showing executed quantities of work in excess of those actually executed under BOQ item No.31. the Respondent accorded approval for the EOT through a letter dated 28. That the Respondent reviewed the execution of the works by the Claimant till 31. It is a matter of record that despite numerous letters from the Respondent. in support whereof copies of the relevant Non Performance Reports are annexed hereto and marked as Exhibit -R-20 to R31. The Claimant failed to maintain and water the shrubs.2.50. The progress was abysmally low and even after expiry of 50% of the completion period.10.11.65/. The time for completion of the work was extended till 31. the value of work executed till then was much below 30% of the envisaged .14 - .359. However.44. of which the Claimant failed to execute even the first one fully. In all.12. That despite grant of the EOT.which will establish the comprehensive failure of the Claimant in all respects and breach of provisions of the contract on their part. A copy of the letter dt.11.

15 - .1 of the General Condition of Contract read along with Item 15 (a) of the Contract Data.12.2(i) of General Conditions of the Contract and demanded an explanation to show cause as to why the Contract cannot be terminated for his default.progress.53.02. In view of the said circumstances. the Claimant completely failed to setup a field laboratory with prescribed instruments in accordance with Clause 53. Clauses 53.2(h) are reproduced herein below. That it is germane to state that the Engineer gave a notice vide letter dated 07. bringing the case squarely within the provisions of Clause 53. but shall not be limited to. the Respondent . A copy of the notice dated 07.2: Fundamental breaches of Contract include.2007 is enclosed as Exhibit-R-54 20. the Claimant failed to complete even 30% of the total value of work even after grant of EOT up to 31. That in view of the fundamental breach of Contract committed by the Claimant the Respondent was within its rights under the Contract to terminate the same under Clause 53.2(h) of the General Condition of Contract.53.2007 wherein the Engineer had recorded that the Contractor had failed to perform the Contract as per Clause No.2007.2 (h): If the contractor has not completed atleast 30% of the value of work required to be completed after half of the completion period has elapsed” 19.2. the following: “53. there by amounting to fundamental breach of Contract under Clause 53. Furthermore. In the present case.02. “53.2(h) and 15(c) of Contract Data of General Conditions of Contract which amounted to fundamental breach of the Contract as per Clause No.2 and Clause 53.

if the Contract is terminated.12. equipment. “55. 21. the Claimant illegally removed all the plant and machinery from the site and therefore the security available to the Respondent under the terms of the Contract against breach of the Contract by the Claimant was illegally appropriated by the Claimant and the Claimant further failed to renew the performance bank guarantees also in accordance with the Contract subjecting the Respondent to avoidable costs and expenses. The Respondent is entitled to recover all the losses suffered by him from the Claimant / Contractor along with the pendente lite and . all property at the site shall be vested with the Employer as extracted herein below. That as per clause 55. and Respondent shall therefore be within its rights to recover the same from the Claimant from the amounts. Tribunal. That it is submitted that the Contractor is not entitled to any award or any interest or any cause including the cost of arbitration. 22.2007 to the Claimant. A copy of notice of termination dated 31.16 - . if any due and payable to the Claimant and reserves its rights to claim excess. if any by way of counter claims against the Claimant at an appropriate time before this Ld.12.was constrained to serve the notice of termination dated 31.2007 is annexed hereto and marked as Exhibit R-32. temporary work and works shall be deemed to be the property of the Employer for use for completing balance work if the contract is terminated because of the contractor defaults” Despite the above provision.1: All materials on the site. plant.1 of the Contract.

4 That the contents of Para 1-4 of the Statement of Claim are matters of record and need no reply. Tribunal for appropriate reliefs as prayed therein. 5. As it transpired. on account of which the Respondent has already moved an application u/s 17 of the Arbitration and Conciliation Act. That the contents of Para 6 of the Statement of Claim are disputed and denied. The tender conditions under ITB nowhere stipulate any time limit for issue of letter of acceptance.future interest and the cost of arbitration proceedings and such relevant costs as may be deemed fit by this Ld. are matters of record. if applicable as per provisions of clause 25. It is specifically denied that there was any unreasonable delay in the issue of the letter of acceptance as contended or at all. 1996 before this Ld. the Claimant has allowed the said performance securities given by way of Bank Guarantees to lapse and has failed and neglected to renew the same beyond the defect liability period stipulated in the Contract.3 (e) of the Contract. Tribunal. The contentions that the road was badly maintained by the Respondent in the mean time is also totally unsubstantiated and false in as . That the contents of Para 5 of the Statement of Claim. It is pertinent to submit here that the said performance securities furnished by the Claimant are meant to be kept valid till the end of the defect liability period and/or till conclusion of any arbitral proceedings. only to the extent that the Claimant had furnished performance security in the form of bank guarantee within 10 days. PARA WISE REPLY ON MERITS 1. 6.17 - .

the contract is signed by the Respondent with the concerned contractors. It is pertinent to submit that the complaints were received by the Respondent regarding road condition from the road users only after arrival of the Claimant at site on 03.2006. 8. That the contents of Para 8 of the Statement of Claim are irrelevant and immaterial and therefore disputed and denied.much as the claimant even at the time of taking over the road after the contract was finalized never recorded anything in writing with respect to the alleged bad quality of the road which is being raked up now solely with the intention to make illegal gains. The details of other contracts executed by the Claimant and referred to are of relevance to . The allegations contained herein are totally unsubstantiated in as much as the Claimant has not placed on record any document to show that this issue was ever raised by the Claimant at the relevant point of time. That the contents of Para 7 of the Statement of Claim are matter of record and needs no reply. it is customary for the Respondent to seek the confirmation from the bankers who have provided the bank guarantees towards performance securities to ascertain the veracity of the bank guarantees provided by the contractors. Only after satisfying itself with regard to the genuineness of such securities. This step was also followed in the instant case and only after receipt of such confirmation from the claimant’s bankers the present contract was signed between the parties. It is further submitted that signing the formal Contract was not a mere ritual as contended by the Claimant in as much as before signing of any such contract.10. Copies of the documents are appended hereto and marked as Exhibit R-10.18 - . 7.

Contrary to this.2006 and the Contract period was to end on 11. 9 & 10 That the contents of Para 9 of the Statement of Claim are denied and disputed. The claim of the Claimant that they had mobilized the heavy machinery and other staff and labour for commencement right from the beginning of June 2006 is totally bereft of any truth in as much as the Claimant has miserably failed to place any document in support thereof.09.establish any standard for the time limit for execution of the contract reckoned from the date of the letter of acceptance. It may be added here that the said contracts referred to by the Claimant were entered into for the purpose of maintenance wherein the earlier contracts given to other contracts had already expired and therefore there was urgency and priority for executing the further contracts immediately after expiry of the earlier contracts.09. As a matter of fact the Claimant had failed to provide even the vehicles for routine maintenance and site management till as late as 18. the same was solely at the discretion of the bidder and it is a matter of record that the Claimant willingly extended the validity of his bid for a period of more than 3 months.84 acres only on 19.19 - .09. It is also a pertinent to submit that as per terms of the ITB. the bids invited for the subject work or to be kept valid for a period of 90 days from the date of submission as per Para 15 of the Tender Conditions and for any further extentions of validity beyond the said period.2007.2006 Exhibit R-33.2007 whereas the work under the Contract had commenced on 12. the Claimant on his own admission had taken on lease an area of land measuring 3.01. The stretch under this Contract was all along being maintained by the Respondent departmentally/ piecemeal contracts and as such there was no urgency and priority to finalize the instant Contract. .

08. It is a matter of record that the Claimant addressed the letter dated 2006. the Claimant can not hold the Respondent responsible for any action or inaction prior to the date of the Contract. 13.2006. As already submitted no equipment/machinery whatsoever was available at site even after signing of the Contract to attend even ordinary / routine maintenance.2006. That the contents of Para 11&12 of the Statement of Claim are disputed and denied as false and concocted. It is also a matter of record that the Contract was executed between the parties on 24. 04. Claimant has to mobilize required machinery.2006. As it transpired.20 - . rest of the contentions . The content of Para 13 of the Statement of Claim only to the extent they are part of the record are admitted. the same claims are totally divide up any proof whatsoever regardless of the fact that even if the same were true. after signing of the same. With regard to the empty claims of the Claimant that they had provisioned the machinery and equipment for executing the work even prior to the date of the Contract.12.02. the Claimant failed to do so in spite of a number of notices by the Engineer. 16.The copy of Claimant’s letter dt.2007 is appended hereto and marked as Exhibit R-41.2006 and the letter to proceed with a work was also issued on the same date.12. The failure of the Claimant in this regard and on various other issues was brought to the Claimant’s notice by the Consultant from time to time through his letters dated 07. 05. 11-12.11.39. Copies of some of the MOM’s and notices are appended hereto and marked as Exhibit -R-1 to R-6 as well as R-34 & R-35. copies whereof are appended hereto and marked as Exhibit R -36 to R.11. As per conditions of the Agreement.2006 and 18.

where it is very clearly specified and it is the primary responsibility of the .3. Clause 27. It is further submitted that the Respondent is not answerable to any actions taken by the Claimant prior to the execution of the Contract.08.1 of Part-I of GCC and Section-6 implementation manual and maintenance intervention levels under clause 6.which are surmises of the Claimant are disputed and denied. C10 & C11 are matters of record and have no nexus or connection with the allegations contained therein. The copy of rainfall data as obtained from Meteorological Department is annexed as Exhibit R-40. it is denied that the Claimant could not commence the works due to the Monsoon season.1.2006. In as much as the Contract was signed on 28. The Exhibits of Claimant i.21 - . 15.. 14. the maintenance program planning shall be in two stages. With respect to Para 15 of the Statement of Claim it is submitted that as per the agreement entered into between the parties. It is also a matter of record that the first indent of items to be completed by Claimant related to simple maintenance of the stretch and had no nexus or connection with a monsoon and therefore.e. With respect to Para 14 of the Statement of Claim it is submitted that the actual monsoon Seasons in the area of works starts from June to September and dry season will start from the October. Moreover the actual rainfall data as obtained from the Meteorological Department would substantiate the fact that most of the month of September 2006 was without rainfall and there was ample scope for the Claimant to carry out the work. the monsoon was already coming to an end by that date and the dry season was to start by October.

17-18. That the contents of Para 16 of the Statement of Claim are totally devoid of any substance and hence disputed and denied.2006 appended hereto as Exhibit R-42 16. Further. any plea of the Claimant disputing the program is mischievous and mala fide. the same are disputed and denied for the reasons that they have no nexus or connection with the work undertaken by the Claimant under the Contract. it is submitted that the Respondent has already explained the failure of the Claimant and the other commissions and omissions on the part of the Claimant in the . That with respect to the contents of Paras 17 & 18. 19. 15. Further it is submitted that the first indent was finalized by the Engineer after a joint inspection of the site by the contractor and consultant.Contractor to submit the first stage program within 28 days of issuance of the letter of commencement by the Respondent.22 - . However. the Claimant admittedly failed to provide any program to the Respondent. After the joint inspection the Engineer had even requested the contractor for his comments and suggestions as substantiated by the copy of the Engineer letter dt. That the contents of Para 19 of the Statement of Claim are disputed and denied. In as much as the actions on the part of the Respondent referred to in the said paragraphs are concerned.09. they were no way connected with the work performance under the Contract and the Respondent was totally at liberty to take whatever action with respect under the Contract beyond the Contract period and for the same reasons the contents thereof deserve to be dismissed summarily. therefore.

Preliminary Submissions, which are not repeated here for the sake of brevity. As it transpired, the Claimant himself submitted the revised the work programme and requested for deletion of certain works from the Claimant’s scope on the plea that the same are not required due to the proposed 6-lanning of the stretch. The said request of the Claimant was forwarded by the Engineer to the Project Director of the Respondent, who in turn had forwarded the same to NHAI Headquarters, New Delhi for necessary approval as laid down in the Contract under Clause 36.1 of the Contract. In furtherance of the said request vide Exhibit R-48, the Claimant held out an undertaking that he will complete the balance work as per his revised work programme for a value of Rs.19,43,90,225.2 by 31.12.2007, which was forwarded by the then Project Director to NHAI Headquarters. As it transpired, the Claimant miserably failed to execute the work even to the promised reduced value as undertaken by them. Even otherwise, the said proposal of the Claimant (referred Exhibit R-48) was rejected by NHAI headquarters which clearly pointed out that any variations to the work under the Contract can be considered only after completion of the work under the Contract as enjoined therein and there was no scope to accede to the request of the Claimant. As such request for reduction of the Contract value to Rs. 19,43,90,225.2 did not have the approval of NHAI as enjoined by Clause 36.1 referred to above and the Engineer did not have any authority whatsoever to approve the same and the Claimant’s reliance thereon is contractually invalid. 20. That the contents of Para 20 of the Statement of Claim are baseless and preposterous and therefore strongly disputed and denied. It is submitted at the cost of prolixity that the stand of the
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NHAI headquarters had been consistent right from the beginning that in the scheme of the Contract and under the circumstances at that point of time, there was no question of accepting any revised work programme from the Claimant as sought to be made out by the Claimant. It was emphasized by the NHAI headquarters that the Claimant was bound to complete the work under the different indents and upon completion thereof, make a request to the Engineer/Respondent for extension of time, which may be granted with or without levy of Liquidated Damages as the case may be. In view of the aforesaid consistent stand of the Respondent, there was no need for submission of any revised work programme by the Claimant or its approval by the Respondent. Thus the alleged delay complained of by the Claimant on the part of the Respondent is without any basis whatsoever. Respondent reserves its rights to make further detailed submissions at an appropriate time in rebuttal of the contents of Para 20. It is further submitted that the Claimant’s letter dt. ______ (Exhibit C-58) that the work could be completed only to the extent stated therein itself is an admission on their part to the Claimant’s inefficiency to perform the work in accordance with the terms of the Contract, their bald denials notwithstanding. In as much as the said failure of the Claimant qualified for termination of the Contract by the Respondent, the Respondent was constrained to do so vide its letter dt. 31.12.2007 (Exhibit R-32). The inefficiency of the Claimant is compounded by the fact that all the activities stated in the Claimant’s letter Dt. 22.12.2007 (Exhibit C-58) are very simple and minor maintenance works which can be done by even a petty contractor through simple planning. The very fact the Claimant was

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unable to do so deservedly called for termination of their services which was done by the Respondent. 21. That the contents of Para 21 of the Statement of Claim are disputed and denied. As already stated, the failure on the part of the Claimant to execute the work in accordance of the terms of the Contract amounted to Fundamental Breach of the terms thereof and therefore the respondent rightly terminated the Contract on 31.12.2007. As admitted by the Claimant in C-60, the only dispute which remained to be settled between the Claimant and the Respondent as on 29.12.2007 was limited to adjustment of payment for variations in the actual percentage of bitumen in terms of Clause 507.9 & 509.9 of MORT & H specifications. This tantamounts to show that the claims as made by the Claimant under the SOC under reply are false, concocted and imaginary. The said claims, though are admissible as per terms of the contract have been kept in abeyance in as much as the Claimant invoked arbitration even before settlement of the same. 22. That the contents of Para 22 of the statement of claim are admitted only to the extent they are matters of record and anything which is not part of the record is disputed and denied. It is a matter of record that the Claimant failed to submit any inventory of items executed by them or any “as built” drawings as mandated by clause 52.1 of the Contract pursuant to termination of the Contract. In the absence thereof, the Engineer was constrained to measure the work and determine the inventory and made recoveries from the claimant’s dues accordingly, which are final and binding on the Claimant. With regard to the contentions of the Claimant that the termination notice dated 31.12.2007 is illegal, null and void, it is
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23-25.12. The failure of the Claimant to raise any dispute in respect thereof shall tantamount to a waiver and the Claimant is estopped from raising any incostinent dispute pertaining thereto before this Ld. The termination of the Contract was accordingly resorted to by the Respondent and it is also a matter of record that the Claimant did not seek to challenge the said action before the Engineer at any point of time thereafter.26 - . Not only the Claimant failed to complete the work as stipulated but also failed to take any cognizance of the said warning and even failed to address the said subject in any of his letters subsequent thereto.2007. Tribunal.2007 (Exhibit R-55) was itself a prior warning to the Claimant of the impending termination. The contents of notice dated 11.12.submitted that under Clause 53 which has been quoted by the Claimant. the same will invite the consequences under Clause 53 of the Contract.2007 (Exhibit R-55) from the Engineer to the Claimant is explicit enough to forewarn the Claimant that if the Claimant claimed to complete the work by 31. As already stated if the Claimant wanted to challenge . That the contents of Para 23-25 of the statement of claim save and except those which are already matters of record are disputed and denied. which dealt with the conditions under which the Contract can be terminated. the Employer is within his rights to terminate the Contract if the Contractor causes a Fundamental Breach of the Contract. The Claimant was also given an opportunity by the said notice to improve his performance.12. The Engineer’s notice dated 11. The Contract does not make any stipulations as to the timing of the termination and therefore the Contractor’s contention to the contrary are de hors the Contract and inadmissible. which he failed to do.

duly raised under the Contract is amenable for arbitration under the terms of Clause 25. the Claimant submitted the bill on 13.03. which subject matter. The said letter even otherwise can not be taken cognizance of in as much as the same was not signed by an authorized signatory as enjoined by the Contract. the Claimant elected to call the said termination in question address to the Project Director of the Respondent whereas in accordance with the Contract.2008 to Engineer and the Engineer. That the contents of Para 26 of the Statement of Claim are disputed and denied. the present alleged dispute sought to be raised by the Claimant is clearly not maintainable. 1996 before the Hon’ble .02. However.27 - . by virtue of the language of the said Clause is entirely within the domain of the Engineer and it is a matter of record that the Claimant did not care to raise any dispute in respect thereof before the Engineer at the relevant point of time. it ought to have been addressed to the Engineer.02.the said termination. In as much as a dispute. the Claimant initiated proceedings under section 9 of the arbitration and Conciliation Act.3 of the Contract. in turn submitted the same to Respondent on 29. 26. even while the said bill was under scrutiny. After termination of the Contract. As already stated the said failure to raise a dispute in respect thereof amounts to a waiver and the Claimant is estopped from raising any dispute with respect thereto. It is the scheme of the Contract under Clause 53 that the Contract can be terminated for Fundamental Breaches on the part of the Claimant.2008 Exhibit R-51. the Claimant had all the opportunities to raise the said objections before the Engineer soon after the termination which the Claimant failed to do. It is a matter of record that by a letter dated 03.2008 (Exhibit C-67) after a lapse of 2 months.

That the averments of the Claimant.2006 to 29. illegally allowed the Bank Guarantees provided by way of Performance Security to lapse. being in a narrative form. the said bills of the Claimant were not processed.) a) Loss on account of delay in issue of 2650158. Claim No.00 letter to proceed (Initial expenditure between 19. the claims raised by the Claimant are not eligible and reasons are placed also in further paras.00 due to delay c) Differential interest on Margin Money 263975. In view of the said directions of the court to maintain status Quo. In view thereof.00 of BG Total 3374980.A-1 : Claim No. unreasonably and illegally do not hold water. Tribunal was also constituted on 06. It is a matter of record that subsequent thereto. 27. save and except those which are already Description .High court of Calcutta and despite the orders for maintaining status quo given by the Hon’ble Court.2006) b) Additional Bank Guarantee Charge 460847.06. It is therefore submitted that the contents whereof.00 1.05.2008 pursuant to invocation of arbitration by the Claimant. the allegations of the Claimant to the effect that the Respondent has acted unfairly. A-1 Amount claimed (Rs. In view of the above explained facts. the present Ld. Claim No. are not capable of any para-wise replies.28 - .08.

In as much as the Contract was executed on 24. in support thereof. Tribunal. pertains to certain alleged losses purported to have been incurred by the Claimant during a period prior to the execution of the Contract. 4. may be deemed to have been traversed in extenso and rebutted by the Respondent. totally devoid of any contemporary documents in support thereof and is entirely based on the Claimant’s bald claim that in expectation of the Letter to Proceed. That the very fact that such a claim has been set up totally in the absence of any contemporary correspondences. by the Claimant’s own showing. they had to be demobilized and redeployed at considerable costs and expenses. payment receipts etc. 2.matters of record. machinery and manpower at the site and owing to the delay on the part of the Respondent to issue the Letter to Proceed.08. any claim which is prior to the said date is de hors the Contract and for the same reason is not maintainable before this Ld.2006. beginning from June 2006.29 - . militates against its veracity and credibility of the alleged claim.. the Claimant had mobilized all the plant. Since the onus of proving the claim is squarely on . (ii) idle manpower. way leaves and permits issued by concerned Govt. which are being claimed. authorities for movement of such heavy machinery. log books. 3. That the above alleged claim. (iii) extra charges for bank guarantees due to delay and (iv) extra differential interest on margin money for issuance of bank guarantees. That the present untenable claim has been built-up purportedly on account of costs and expenses incurred on account of (i) idle plant & machinery.

together with your written acceptance thereof. Whether the Claimant complied with the said requirement or not . A bidder may refuse the request without forfeiting his bid A bidder agreeing to the request will not be required or security. at any time prior to the award of Contract.” (ii) Clause 31.” Clause 33 referred in Sub-Clause32. the Employer reserves the right to accept or reject any Bid. prior to expiry of the original time limit. without thereby incurring any liability to the affected Bidder or bidders or any obligation to inform the affected Bidder or bidders of the grounds for the Employer’s action”. To be more explicit.30 - .2 enjoins the successful bidder to provide the performance security within 10 (Ten) days after receipt of the Letter of Acceptance. the said sub. The request and the bidders’ responses shall be made in writing or by cable. the Claimant has failed to discharge the said onerous obligation.Clause 32.1 : “ Notwithstanding Clause 30. The agreement provisions are as under : (i) Clause 15. 5.4 of P-80 of Agreement). but will be required to extend the validity of his bid security for a period of the extension and in compliance with Clause 16 in all respects. subject only to the furnishing of a performance security in accordance with the provisions of Clause 33.Clause reads as “ The notification of award will constitute the formation of the Contract.2 “ In exceptional circumstances. the Employer may request that the bidders may extend the period of validity for a specified additional period. (iii) Unless and until a formal Agreement is prepared and executed this Bid. and to cancel the bidding process and reject all bids.2 in particular is misplaced in as the said provision imposes a further condition for effective implementation of work under the Contract. permitted to modify his bid. That the partial reliance placed by the Claimant on Clause 32 of the ITB in general and Sub. 6.the Claimant. shall constitute a binding contract between us (Item No.

the successful bidder is required to furnish Performance Security within 10 days after receipt of the LOA. (iv) Under para-33.1 of the ITB. para 33 of ITB. – Refer page 18.06. (iii) Letter of Acceptance was issued by NHAI in the name of Maheshwari Brothers Ltd on 19.05.2006 and received by NHAI on 12.05.2006 in the name of Maheshwari Brothers Ltd and confirmed by the bank by letter dated 06.will be elucidated by the chronology of events as detailed hereinafter: (i) Bid was submitted by Contractor in the name of Maheshwari Brothers Ltd on 24.2006 – Refer page 116 of the Contract.31 - .2006 – Refer page 05 of the Contract. (vi) As per internal correspondence in NHAI Headquarters the Competent Authority discussed for the above subject work and it was decided to keep the file pending till .2005 – Refer pages 80 & 81 of Contract.12. (v) Performance Security in the form of Bank Guarantee was provided by the Contractor on 27.05. sub-para 33.06.7% during evaluation of bid on 03. (ii) Maheshwari Brothers Ltd offered a rebate of 1.2006 – Refer page 105 of the Contract.

2006. (ix) After receival of legal opinion.e.07.. . The same was discussed by the then Chairman on 31.2006 by the concerned Manager in Headquarters.08. (x) By a letter dated 07. it would be appropriate for the Respondent to enter into Agreement with MBL Infrastructures Ltd was referred for legal opinion by the Respondent vide letter dated 30.2006. Contractor formally informed NHAI regarding the change of name of the company with relevant documents from the ROC. Maheswari Brothers Ltd.07.08. (viii) Legal Opinion was received from M. on 26.obtaining legal opinion in respect of the work of Barwadda-Panagarh Section of NH-2 – Package-II. vide letter dated 25. The new Chairman has discussed and approved to sign the Contract on 17..V. (vii) On the request of the Claimant.32 - ..2006.R-67. it has been desired by the Chairman that the file be submitted to his successor.2006 – Ref Exhibit-R68.Refer pages 120. whether in the light of the change in the name of the bidder i. 121 & 122 of the Contract. Maheshwari Brothers Ltd to MBL Infrastructures Ltd.07. Advocates.2006 – Ref Exhibit.. the file was put up for signing of the Contract Agreement with M/s.Kini & Co. the issue.06.

33 - .2006 Bank issued amendment to the BG dated 27. the work under the First Indent did not call for mobilization of manpower.08.(xi) On 19. Contract stipulates mobile maintenance unit and minimum equipment to be deployed at siteRefer pages 73 and 74 of the Contract. Contractor wrote in continuation of earlier letters dated 07. (xiv) Contract was signed on 24. Refer page 68 of the Contract and the First Indent (Exhibit R-70) placed on the Claimant. (xiii) On 23.08.08. It is a matter of record that even the field laboratory. (xii) On 22.2006 in the name of MBL – Refer page 112 of the Contract.2006 enclosing copies of MOA & AOA of MBL and Maheshwari Brothers Ltd – Refer page 124 of the Contract.05.08.08. That the Claimant’s averments about massive mobilization are hollow and without substance. That it is therefore submitted that there was no delay on the part of the Respondent to sign the Contract once the performance .2006 – Refer page 03 of Contract. to the extent claimed by the Claimant. immediately after execution of Contract could not be set up by the Claimant in time.08. 7. It is also relevant to refer to the Claimant’s admission regarding its inability to mobilize heavy equipment in Exhibit C-23 at page 116. setting up of which was mandatory.2006 the Bank confirmed the Amended Bank Guarantee – Refer page 118 of the contract. plant & equipment etc.2006.2006 and 21. 8. Even otherwise.

14. certified but not paid (i) IPC-8 (ii) IPC-9 (iii) Work done but not certified Wrongful deductions for alleged non compliances Amount deducted for non acceptable recoveries Total = Amount (Rs.37.2006 was solely attributable to the Claimant.337/.4.37. Claim No.12. b.: Other recoveries amount Rs.security.00 The analysis of the deductions made by the Engineer is correct and the reasons for the said deductions are as under: a) BOQ Item No.) (b) (c) 16307725.: Description (a) Work done accepted.9.3 – Recovered Amount Rs.34 - .00 4924020.00 1257462.462/- .4.27. in accordance with Clause-33 of the ITB was provided by the Claimant and the reasons for signing the Contract on 24.00 15854841.08.2 – Recovered Amount Rs.: c) BOQ Item No.00 41737012.1 – Recovered Amount Rs.832.9.012/. The alleged claim therefore merits summary dismissal. c & c1) for Rs.2006 vis-à-vis the Letter of Acceptance dated 19.794/.: b) BOQ Item No.15.17.2.4.40.00 3392964.64/.05.A-2 (a.

the documentary proof whereof have been furnished in Exhibit-R20 to R31.6.   . Recovery towards photographs and video graph has been made as per the agreement conditions. Other recoveries for an amount of Rs. 4. The recovery towards nonconformance for BOQ Items 2.2.8.35 - . Recovery towards casualties of median plantation done as per the survey report. The total recovery amount shown in the Exhibit:R50/A (Amended). The recovery calculations were made by the Consultant Engineer is herewith enclosed as Exhibit:R-64.2 & 4.1.The Engineer had brought to the Claimant’s Notice to the said deductions as and when the same was effected from the monthly statements/IPCs it happens regarding various non-conformance and recoveries were made accordingly.27.462/was recommended by the Consultant to Respondent towards various non-conformance of BOQ items as under.3 were made as per the Scope of Work. survey report on termination of the contract was prepared and submitted to this office is herewith enclosed and based on that the recovery was made and it is correct. median plantation. recovery towards surface unevenness of BC was made as per section 6 of Agreement implementation manual and maintenance intervention level Clause No.  Non lettering of distance measuring stone of BOQ item 2.12.

That the contents of Paras are disputed and denied.14.1 Part-I of GCC read along with Clause No. Recovery towards non-carrying out roughness measurement has been made as per Standard Specification of MOST/IRC/IS Specification. Claim No. That as per Clause 27.00 total payment due Description The deduction of Liquidated Damages as well as deduction of 20% from balance work to be executed as per Clause 54 of the Agreement were resorted to by the Respondent strictly in accordance with the provisions of the Contract.3.41. 3. There is no rule that BT has continuous stretch for conducting the roughness index. A-2(c1) Amount claimed (Rs.014. Claim No. the Contractor has to conduct roughness index for the work done.) Liquidated damages accounted in 3.36 - . The contents of the Para 3 are disputed and denied. the contractor and the consultant within . hence it can be done even for 100m also therefore Claimant’s argument is herewith denied and recovery made by the Consultant is correct. PARA-WISE REPLIES ON MERITS: 1-2. The Respondent reserves its right to make detail submissions in support of the same at an appropriate time.1 of Section 6 of the Contract. 6.A-2(c-1) : Claim No.

2007.e. the monsoon season which will affect the work in the months of June. The work was programmed and indents were finalized keeping in mind. In view of the non submission of work programme by the Claimant. after lapse of 70 days from the date of commencement of work whereas in accordance with Clause No.. 2006 to May. the Engineer finalized the work program and issued the indents to the Claimant for execution. 4-5.11. It is clearly mentioned that the inspection was made on 7th & 8th September 2006 by the consultant and contractor for finalization of the works which were undertaken under 1st quarter only. Therefore.09. It is submitted that the Claimant was to execute the work during the currency of the contract period which was 12 months. Based on the above. detailed discussions were held by the Team Leader with the contractor on the work indent to be .2006 i.2006 (A copy of the same is marked as Document C/12) it is expressly mentioned that “Having identified the works to be taken up on priority in the Ist quarter.37 - .1 of Para-I of GCC the same was required to be submitted within 28 days from the date of commencement of work. identify the activities of routine maintenance. It is submitted the in the minutes off the meeting held on 08. It is a matter of record that the Claimant eventually submitted the work programme on 22. July and August.a period 28 days from the date of issuance of letter of commencement by the employer shall firstly. the dry spell is available from September. the Engineer was constrained to finalize and issue the indents even in the absence of the required details in the interest of work. 27.

there is no question of any discrepancy in finalization of first indent. The same was accepted and signed by the both the parties and therefore.09.1 for the period of 12. infact.The contractor was explained in detail about the items of works to be executed during the Ist quarter and to ensure the safety of traffic and to avoid inconvenience to the road users. Further it is stated that the contractor has mentioned preparation of yearly maintenance program which is not correct (refer the claimant’s document C/12) where it is clearly mentioned that the inspection was made on 7th & 8th September 2006 by the consultant and contractor for finalization of the works which were undertaken under 1st quarter only. Thus from the above it will be clear that the Ist Indent was finalized only after detailed discussions with the contractor. the Engineer had requested the contractor to go through the Indent again and give its suggestions. Also the contractor was requested to submit the methodology / method statement for the items finalized now and to quantify the items of work”.1 of Section 6 of the Contract.finalized. The views of the contractor were taken into consideration .3.2006 for the first quarter (3 months) are general and ordinary works and which required no need of heavy machinery.12. 6. The contents of Para 6 are disputed and denied. It is submitted that most of the works finalized under indent No.2006 to 11. Finally the draft work indent was prepared and presented to the contractor duly requesting the contractor to once again go through it and to offer their comments any. 6. That as per Clause 27.1 Part-I of GCC read along with Clause No.38 - . the contractor and the consultant within .

MBL Infrastructures Ltd. 2007. in letter dt. 9. That the contents of the Para 8 are disputed and denied. the Project Manager of Claimant.11. the Engineer issues the Indent to the contractor for the execution of the work.. Moreover. The work was programmed and indents were finalized keeping in mind the monsoon season which will affect the work in the months of June. secondly a management meeting shall then to be called within a period of 7 days which is to be attended by both the contractor and the consultant. That the contents of Para 7 are denied and the replies to Para 4 & 5 are reiterated in reply to the same. Only thereafter..20. the dry spell is available from September. M/s. However. Therefore. the contractor has not completed timely.12. July and August. submitted the work programme on 22. 8. That the contents of Para 9 are matter of record and need no reply. after lapse of 70 days from the date of commencement of work.e.2006 (A copy of the same is marked as . Based on the above. 7.a period 28 days from the date of issuance of letter of commencement by the employer shall firstly.2006 i. identify the activities of routine maintenance.3 is very simple and single activity even for these types of simple works. It is submitted that the Claimant was to execute the work during the currency of the contract period which was 12 months. the Engineer finalized the work program and issued the indents to the contractor for execution. 2006 to May. Therefore.39 - . Indent will be issued by the Engineer after due consultations with the Contractor and with the consent of the Contractor. The Indent No.

2006. However. It is denied that the Claimant had brought any machinery at the site for carrying out the works as contended. It is pertinent to submit that except for the 1st indent. 11.2006 shows that the contractor had failed to even complete the balance work of Indent No. Thus the claim of the Claimant with regard to mobilization of machinery at site is clearly false and fictitious. As a matter of fact the Claimant had taken the site on Lease and Submitted the lease documents to the Respondent only on 05.40 - .02.12.1 for the quarter ending with 11. 10. That the contents of the Para 10 are disputed and denied.12. the Claimant failed and neglected to cooperate with the consultant for . Therefore. contents of the present letter are sufficiently evident to prove beyond doubt that the contractor was lackadaisical in its approach in executing the work. the negligent attitude of the Claimant is clearly borne out from the letter. That the contents of the Para 11 are disputed and denied.2007 as clearly recorded in Exhibit R-41. a forecast of the future indents are issued to the Claimant for the purposes of the advance planning. Therefore. It is submitted that the contents of letter dt. 20. In the said letter the consultant also recommended penalty on the contractor up to completion. It is submitted that all the indents can not be issued at the same time in as much as the same have to fit in the work program and accordingly issued as and when the work under the earlier indent is accomplished.Document C/16 in the written statement) the Engineer has informed the Contractor about the absence of their Project Manager and the Vice President due to which the execution of the work was severely affected.

2006 to 30th April. The contractor did not raise any of these issues at the relevant point of time. However. on account of which the Respondent received as many as 70 complaints from the road users during the period of Claimant’s services under the Contract. Whit regard to the contents of sub paras a. Even though the Contractor has failed to cooperate with the Consultants in this regard. Non cooperation of the Claimant was also brought to the notice of the Claimant during various Management meetings. 27. The Claimant failed to carry out even simple maintenance of the reach. it is submitted that all the indents contain the details of the locations as well. d & e. 2007) corresponds to the work which was supposed to be completed by the Claimant under the 2nd indent. the Claimant had deliberately and intentionally continued with its non cooperation for reasons best known to them.1 of Para-I of GCC. . It is further submitted that the details of work to be performed as stated in C/17 (the items proposed from 1st December. b.finalization of further indents. 12 & 13.41 - . finalized and issued further indents. c. 14. Rest of the Para is wrong and denied. The Claimant never complied with the requirements of Clause No. That the contents of Para 12 & 13 are disputed and denied. a list whereof is appended hereto as Exhibit R-10. after the first indent even though the Consultant had initiated. That the contents of the Para 14 are to the extent they are matter of record are admitted. the indents were issued from time to time in accordance with the work programme with proper notice to the Claimant giving a forecast of future work.

2006. Hence. b) As per the requirement to fulfill the agreement condition. Almost all the above three indents fall in 2nd quarter. 16. mischievous and denied in entirety. Therefore.2006. all the indents issued based on the requirement of the site condition and available time factor. That the contents of the Para 16 are false. same cannot be allotted.15.42 - . 4th indent commencement date was fixed on 20. That the contents of the Para 15 are denied. . the Respondent had requested the Claimant to submit required documents. It is submitted that 2nd indent commencement date was fixed as 01. there is no delay on the part of Respondent. 3rd indent commencement date was fixed on 01.12. the crane must be 15 ton capacity.12. the Respondent gave the letter to proceed with the work without any delay.12. The Claimant failed to plan and programme the work which was also brought to their notice during various monthly meetings.2006. Therefore. It is submitted that after signing of agreement. c) As per agreement condition. for the same the consultant had requested clarification. (a) The premises of the Inspection Bungalow are not meant for establishing the Contractor’s work site. The indents issued on various dates during the agreement period are annexed as Exhibit R-42 to R-47.

e) As per the applicable Labour laws.08.. This issue was never raised by the Claimant during the period of contract. they should have obtained permission from Labour Department. some of the RFIs are not approved on the same lines and reasons were mentioned by the Consultants there itself.2006. But no such power of attorney in this regard had been submitted to Respondent. the kerb painting works to be done after the repairs. it seems that the Contractor is not carrying out the work properly as per standards.d) The claimant has appointed i) Shri Anju Maheshwari. it is stated that preparatory work was to be carried out for doing specified work i. Further. For the same the Respondent has requested to submit the authorization duly certified with notary as the names of above said persons are not included in the Agreement. Like wise. the date from which the work was to be proceeded with. are to be carried out. ii) Shri Suryanarayana Murthy. the RFI was not approved by the Consultants which is correct as per agreement conditions. The same was brought to the Claimant’s notice. the Consultants have rejected to work on public holiday. .43 - . Hence. If the Claimant wanted to work on public holiday. f) That it is a matter of record that the entire site was handed over to the Claimant on 28.e. iii) Shri Riyazuddin Pasha as authorized persons by the Directors of its Company. Due to the said reasons.

1 was 11th December 2006 and not 2007. That the contents of the Para 18. That the contents of the Para 17 are disputed and denied.2007 on certain conditions as per the meeting held at the Head Quarters of the Respondent. That the contents of paras 19 & 20. except those which are matters of record are disputed and denied. 2006 and 16th November.2007 marked as Exhibit: R-56 and once again failed to execute the work as per the terms of the Contract. The original date of completion of work under Indent No. 19 & 20. 18.07. However. However on 31st October. but did not give any cogent reasons for noncompletion of the work within the stipulated period.12. it is submitted that due to the inability of the Claimant to execute the work. It is denied that the Claimant was prevented by the Respondent from executing the work. In the said meeting. 2007 the Claimant represented with details and requested EOT and the same was granted up to 31.08. 2006 as the due date of completion. In view thereof.44 - .2007 and 02. except those which are matters of record are disputed and denied. The Consultant had brought to the Claimant’s notice from time to time their lapses during the management meetings as well as through correspondence on 7th November. the request for EOT could not be finalized by the Respondent. the Claimant had sought EOT on 02. A bare perusal of these letters would reveal that the Claimant had failed to mobilize its machinery in time at site and as a result thereof could not execute even the indented work in time. a meeting was .2007.17. the Claimant had promised to complete the work within the extended period. despite the said assurance the Claimant at the time of request for extension of time dated 13.08. Further.

A copy of the Contractor’s letter dt.65/.2007). 10.held at the Respondents Head Quarters wherein the Claimant requested for reduction in the scope of work in view of the tenure of the Contract and to exempt certain work on account of the prospect of 6-laning. 60. 10.31. 38. However.117/-.141.2007 had informally revised the indents as per the request of the Claimant without seeking prior approval from the Employer and the reliance of the Claimant on the said letter of the Engineer is totally misplaced and inadmissible.19. The Engineer. the said revised work programme was rejected by the Headquarters of the Respondent and accordingly the Claimant was requested to submit a detailed variation proposal.2007 is annexed hereto and marked as Exhibit .09.and remained so till the date of termination of the Contract.44.09. the reliance of the Claimant on the impugned revised work programme and revised value of work is de hors the Contract and have no sanctity whatsoever. vide his letter dt.12.45 - . Hence.2007 on account of which the revised value of work was shown by the Claimant as Rs.12. Subsequent to the meeting. the Claimant again committed breach of the condition to complete the works within the revised date of completion (31.R-48. the intended completion date of the work was 31. The value of work to be executed under the Contract was Rs.2007 as approved by NHAI pursuant to the request of the Claimant subject to the Claimant submitting a revised work programme for completion by that date and levy of Liquidated Damages by Respondent. .10. However. the Claimant submitted a revised work programme dt. 31. However.10.

The indents 5 & 6 were issued as per site requirements and the Claimant failed to co-operate with the Consultant for finalization of the indents and also certain items of works which did not need any machinery. That the contents of the Para 23 are disputed and denied as false. That the contents of the Para 21 are matter of record and needs no reply. Resultantly.21. 22. frivolous and hence denied. the Respondent was unable to release the bills as the final account has to be settled and also various recoveries are to be made. That the contents of the Para 24 are disputed and denied.46 - . the bills had to be returned to the Claimant several times due to insufficient information. As a matter of fact the Claimant never submitted any bills in time and if submitted. The Claimant never challenged the validity of Indent nos. 5 & 6 before the Respondent. 5&6. The failure and inability of the Claimant were willful and wanton and the Claimant’s efforts to foist the blame on the Respondent are mala fide and misplaced. It is pertinent to state herein that IPC 8 was submitted by the Claimant at the end of the extended period and IPC 9 was submitted after the termination of the Contract. 23. Therefore. The Claimant failed to perform even such activities. the Claimant cannot absolve himself from the liability to execute the work envisaged in Indent no. 24. much less to claim any compensation for the work executed. they were without the necessary documents. That the contents of the Para 22 are false. . Therefore.

26 & 27. Further it is submitted that as per Exhibit:R-43 the stretches covered in the indents were more than 400mts and it is a matter of record that in the revised work programme. That the contents of the Para 25 only to the extent they are matters of record are admitted. However. the Claimant . The liquidated damages were imposed and calculated IPC wise as per details given in Exhibit R-50 & 50/A (Amended) appended hereto. It is a matter of record that the extension of time was granted on the specific condition that the LDs would be imposed. The Claimant was well aware that the contract was for the repair and maintenance and quoted the price accordingly. Therefore. the recovery of liquidated damages became impossible due to the minor value of work executed by the Claimant and the priority for recovery of mobilization advance. any claim of the Claimant regarding the additional cost is wholly misconceived and liable to be dismissed. It is emphatically denied that the Respondent prevented the Claimant from completing the work under the indents. The Contract entered into between the parties was for maintenance and under any maintenance contract it is unlikely that the work will be executed only in continuous stretches. 28 That the contents of these Paras 28 are disputed and denied.47 - .25. That the contents of the Paras 26 & 27 are disputed and denied. Thus. the Respondent was unable to recover whatever amounts were shown in the Measurement Books for future recovery. In fact the Claimants did not need anybody to prevent them from completing any work in as much as the Claimant themselves are eminently capable of not completing any work assigned to them on their own.

Hence the Consultant has taken in to the consideration that the minimum period has to be given to the Claimant for mobilization of heavy machinery and also keeping in mind that the onset monsoon may start from June. the commencement date was fixed as 01. That the contents of the Para 29 are disputed and denied. after the lapse of 80 days of original commencement of work. The Claimant consciously entered in to Contract with the Respondent for the work covered therein and the extraneous considerations which are clearly outside the Contract cannot justify the failure of the Claimant in the faithful execution of the work. from 12/06 to 04/07 because the monsoon generally commences from June onwards. 29. That the contents of the Paras 30 to 35 are based on conjecture and surmises and therefore are disputed and denied in entirety. The contentions therefore merit summary rejection. As regards the 2nd indent. the Claimant failed to cooperate with the consultant in finalizing the Indents. It is very obvious that the Claimant has sought to invent reasons to cover up their inefficiency and ineptitude to handle a contract of this magnitude.himself submitted his work plan for stretches varying from 100m to 400m length for BC laying as will be evident from Exhibit:R-59. 2007.2006. The Respondent has narrated in detail the true and correct sequence of events in the Preliminary Submissions which are relevant to the present untenable claims and the same clearly negate the misconceived theories sought to be advanced by the Claimant in support of the untenable claim.12. However. the Consultant has finalized indents as per site requirement as well as the available dry spell i.e.48 - . 30-35. . It is submitted that after the First Indent.

The Claimant could not sustain even the costs associated with the execution of work under the Contract which clearly negate any substantial investments on the part of the Claimant as claimed or at all. It is submitted that the nature of items are proposed in the First Indent did not call for any heavy machinery and the items were ordinary / simple maintenance activities. indents are issued for various items which are required as per the site conditions and as and when certain item of work is required or forecasted. . the quantities thereof are also specified in the indents. The Claimant was reportedly facing personal cash flow problems which obviously reflected in the slow progress of work. the Claimant was not geared to handle even the simple work contemplated under the Contract due to improper planning. As per the Maintenance Intervention Levels given in page No. For the urgent repairs to eroded portion on V-V Section LHS. inefficiency and cash flow problems which resulted in the non completion of work within the indented dates. inability. That the contentions contained in Paras 36 to 38 are baseless and preposterous and therefore strongly disputed and denied. Further. Ramavarappadu on NH-5. Even then. It is emphatically denied that the said works were not specified in the Indents.49 - . That the contents of Para 39 are disputed and denied. In a maintenance contract. the pipes were to be realigned and a concrete body wall was to be reconstructed.36-38. These items were already included in the indent issued. the Claimant failed to fulfill the obligation as per the Contract.75 of Contract the alleged work executed by the Claimant in Para 58 was a maintenance work and a part and parcel of the Contract. 39.

40.2007 had informed the Claimant that the Claimant failed to achieve a minimum of 30% progress when in fact half of the Contract period was already over. 41 to 43. 46 & 47. That with respect to the contents of Paras 46 & 47 of the Statement of claim it is submitted that the work was revised and submitted by the Claimant for approval due to the failure of the Claimant to complete the work within the time prescribed under the Indents. The Respondent in its letter dated 18.04. That the contents of Para 41 to 43 are disputed and denied. That the contents of Paras 44 & 45 are disputed and denied. The establishment of field laboratory was not only for the bituminous works but also required as per the Contract conditions to test and verify the quality of work of various items of works which were under BOQ. It is further denied that due to the extension of time frame the Respondent lost its . The Respondent further informed the Claimant about its failure to establish the lab with all the prescribed equipment. In the Contract. That the contents of Para 40 are baseless and preposterous and therefore strongly disputed and denied. The untenable and far-fetched reasoning devoid of rationale adverted to by the Claimant cannot negate the evident fact that the execution of the work was too slow and the Claimant failed to execute the work in consonance with the work program. it was very clearly specified that within 30 days from commencement of work the field laboratory was to be established. It is emphatically denied that the Respondent had extended the time frame in view of its default. 44 & 45. The averments contained in the Preliminary submissions are reiterated and reaffirmed.50 - .

As a matter of fact in the letter granting extension of time.51 - . That the contents contained in Paras 50 & 51 are disputed and denied. . That the contentions contained in Paras 48 & 49 are baseless and preposterous and therefore strongly disputed and denied. It is submitted that the Claimant was under financial crisis and requested the Respondent not to recover the amount of LD from the payments and instead offered to submit BG’s of equivalent value in lieu of LD and upon acceptance of the same by the Respondent. The imposition of Liquidated damages by Respondent is as per Clause 45. The Respondent agreed in good faith and with a view to help Claimant to complete the work. it was very clearly specified that levy of the Liquidated Damages would continue. That the contents of Para 52 are disputed and denied. 50 & 51.1 of the GCC of the Contract. 48 & 49. Therefore the respondent recorded the LDs in the M-Book are tabulated and enclosed as Exhibit R-50 & 50/A (Amended) to adjust the same in future bills due to negative value of work done. submitted the same voluntarily as will be evident from Exhibit:R-60. The respondent had already withheld the amount towards liquidated damages in running bills as a paper adjustment because the value of work done by the contractor was very less in the beginning months and the amount was only sufficient to recover mobilization advance.right to levy LD on the Claimant. 52.

on account of continuous and consistent failures by the Claimant.12. the work was terminated on 31. Tribunal. That the contents of Para 61 are disputed and denied. The Liquidated Damages are imposed as per the terms of the Contract and any contention to the contrary is emphatically repudiated.2007.12. 60.2007 as promised by the Claimant. The Respondent will refer and rely upon the Preliminary submissions and explanations made in paras 19-20 in this claim. Therefore. original date of completion as per agreement condition and once again failed to complete the revised work program within extended time period i.A-2(f) : .e.53-57 That the contentions contained in Paras 53 to 57 are baseless and preposterous and therefore strongly disputed and denied. 61.09. the Contract was not extended further.2007.2007.. Therefore the Contract was terminated by the Respondent on 31. Claim No. That the Claimant failed to complete the work on or before 11. 31. That the contnts of the Para 60 are disputed and denied. That the contents of Para 58 are disputed and denied.12. 58.52 - . Due to the breach of the Contract by the Claimant. The work was not completed in time due to reasons totally attributable to the Claimant. That the contnts of the Para 59 are disputed and denied. 59. The contents of sub-paras (a) to (j) are also candidly disputed and denied and the Respondent reserves its right to make detailed submissions in rebuttal thereof at an appropriate time before the Ld.

A-3 : Claim No. After termination of the Contract. disputed and denied by the Respondent save and except those which are specifically admitted herein.) 53. It is further submitted that the contents of the SOC with respect to the above untenable claim.A-2(f) Description Deduction in IPC 9 on amount of 20% of the balance work to be completed Amount claimed (Rs. the Respondent reserves its right to make detailed submissions in rebuttal thereof at an appropriate time before the Ld.022.51.77. the Claimant submitted the bill on 13. which are not repeated herein for the sake of brevity. Amount claimed (Rs. Claim No.62. Further.00 That the contentions of the Claimant with regard to their alleged eligibility for the above misconceived claim are vebose and without any para numbers to facilitate any point-wise or para-wise Reply by the Respondent.Claim No.518/- That the contents of this para are disputed and denied. Claim No. Tribunal.02.53 - . to the extent not specifically adverted to and replied herein specifically shall be deemed to have been traversed in extenso . in turn submitted the . Suffice it would to state that the said recovery was made by the Respondent wholly in accordance with the Contract for the reasons and grounds already stated in the Preliminary Submissions and para-wise replies.A-3 Description Amount withheld from IPC-1 to IPC-9.) 1.2008 to Engineer and the Engineer. Claim No.

748. the Claimant initiated proceedings under section 9 of the Arbitration and Conciliation Act.) Respondent 15.49.1 of the GCC of the Contract as the value of work done by the Claimant was meagre during the initial period of the Contract and the amount was hardly sufficient to recover mobilization advance. However.00 Disallowed That the contents of the Para are disputed and denied. It is a matter of record that subsequent thereto.06. In view of the said directions of the court to maintain status Quo. illegally allowed the Bank Guarantees provided by way of Performance Security to lapse. even while the said bill was under scrutiny. However.A-4 Description Charges on Bank Guarantee for LDs and Differential interest on Margin Money of BG Amount Remarks of claimed the (Rs. the said bills of the Claimant were not processed. Tribunal was also constituted on 06.54 - .2008 Exhibit R-51. the Claimant offered to submit unconditional BG’s in lieu thereof in as much as the Claimant was . the present Ld.02.same to Respondent on 29. The Respondent had already withheld the amount towards liquidated damages in running bills as a paper adjustment in accordance with clause 45.A-4 : Claim No. 1996 before the Hon’ble High court of Calcutta and despite the orders for maintaining status quo given by the Hon’ble Court. Therefore the Respondent recorded the LDs in the Measurement Book [Exhibit R-50 & 50/A (Amended)] to adjust the same in future bills due to negative value of work done.2008 pursuant to invocation of arbitration by the Claimant. Claim No. Claim No.

A-5 Description Amount claimed (Rs.00 Losses on account of price rise due to delays 1. may be treated as reply to the averments of the Claimant contained herein. which again.A-5 : Claim No. as per . The contents of the reply to the said claim.) 18. 2.under financial crisis and requested the Respondent not to recover the amount of LD from the payments.55 - . A-1 and therefore is not being repeated for the sake of brevity. Claim No. the extra Bank Guarantees were submitted by the Claimant at their own option and therefore the above claim is clearly misconceived and untenable. Claim No.803. which has been dealt with in extenso in reply to Claim No. That the tenure of the services under the present Contract was limited to 12 months only and as per practice. That the present untenable claim. The Respondent agreed in good faith and with a view to help Claimant to complete the work. to the extent applicable. such short-term contracts do not qualify for price adjustments. which is clearly an after thought. Thus. accepted the same. has also been raised on account of the alleged delay between the date of the Letter of Acceptance and the actual date of signing of the Contract. Even otherwise the present claim cannot lie against the Respondent under the terms of the Contract.17.

2007 for failure on the part of the Claimant to achieve even the minimum progress in the work as prescribed under the Contract. which is not prescribed by the Contract..05.12. Thus. materials.e. That it has been contended by the Claimant that the Claimant had extended validity of its offer only till 26.2007.2007 and that by the time the Contract could be performed.12. 4. It is rather strange that having failed miserably to achieve even the minimum quantum of work as prescribed under the Contract.e. the reliance of the Claimant on WPI is misplaced. the other date. 31. In support of this contention. 3. the Claimant has also relied on C-63. i.2007 has been shown as actual date of completion. That the present untenable claim is inconsistent with the Claimant’s written undertakings given to the Respondent at different points of time [Refer to letter dated 03. It is also a matter of practice that even under contracts with price adjustment provisions.2006 (page 105 . wherein the Claimant has taken two reference dates to calculate the present untenable claim.05. the Contractor will be ineligible for the said benefit during the period of prolongation of work if the reasons for such prolongation is attributable to the Contractor. the Claimant seeks to claim a reward for such failure.practice are guided by Wholesale Price Index (WPI). While the base date has been taken as 12 months after the date of Letter of Acceptance i. As already stated in the Preliminary Objections (Refer paras 17 to 19).. machinery etc.56 - . there had been a general rise in labour. the Contract had to be terminated by Respondent on 31. which is categorically denied and repudiated by the Respondent.05. 12.

Description Amount claimed (Rs.e. 2. Claim No. Exhibit-C-23 (pages 115 to 118) and Exhibit R-56 (pages 172-173)]. to the extent applicable.88. may be treated as reply to the averments of the Claimant contained herein. No.3 of the Contract Data. A-1 and therefore is not being repeated for the sake of brevity.A. That the present untenable claim. Therefore. the Claimant’s argument herewith denied regarding loss on account price rise due to delays for sign of the Contract.of the Contract). on 24.57 - . 6.788/6 period (claim for overhead and establishment) 1. which has been dealt with in extenso in reply to Claim No. 5.. The contents of the reply to the said claim. has also been raised on account of the alleged delay between the date of the Letter of Acceptance and the actual date of signing of the Contract.08. That under Clause 17 of the General Conditions of Contract read with S. The present untenable claim is clearly de hors the provisions of the Contract and hence merits summary rejection. which is clearly an after thought.2006. the Completion Date for whole of the works is 12 months from the Start Date.loss due to prolongation of contract 5.) Claim No.94. The facts and reasons were already explained in Claim No. Therefore the contention of the .1 regarding signing of the Contract i.A-6 : Claim No.

2006 and accordingly. It is a matter of record that due to the miserable failure of the Claimant to achieve completion even after such prolongation. That the Letter to Proceed with the work was issued by the Engineer on 29. wherein the Hon’ble Supreme Court. on the request of the Claimant. which is clearly inapplicable to the present case. 4.Claimant to quantify alleged delay to be eight months reckoned from the date of the bid to the date of signing the Contract is totally misconceived and untenable. That the present untenable claim has been quantified by the Claimant in Exhibit.C-68. However.12.58 - . while discussing the method for computation of damages.2007 subject to levy of liquidated damages (Refer C-27). as elucidated in paras 1 to 14 of the Preliminary Objections. A perusal of the said exhibit reveals that the Claimant has sought to rely on the Hudson Formula. 3. The Claimant has already placed on record the judgment of Hon’ble Supreme Court in the matter of Mc Dermott International Inc Vs Burn Standard Limited and Ors reported in (2006) 11 SCC 181. the present claim is totally misconceived and untenable. the Claimant consistently failed to execute the work in a timely manner and as recorded in para-15 of the Preliminary Objections.08. the Contract perforce had to be terminated by the Respondent. including Hudson Formula can be applied for . In the above circumstances. which will buttress the fact that the alleged prolongation of contract period was only on account of reasons attributable to the Claimant exclusively. has acknowledged that certain formulae. the Respondent accorded approval of extension of time for completion of work by 31. the work was to be completed in all respects by the Claimant within 12 months from the said date.

The Hon’ble Court’ble Court has also held in para 97 of the said judgment that “a claim for overhead costs resulting in decrease in profit or additional management costs is a claim for damages”.07.  The Project Director submitted para-wise remarks for the claimant’s reference No. (c) The Authority may consider for grant of EOT to the Contractor duly imposing the liquidated damages (as per Clause 45. (b) The Contractor has to substantiate his claim for EOT as per Clause 28 in a prescribed format for consideration. It is rather strange that the Claimant.calculation of the damages.59 - . in total non application of mind.2007 also replies / recommendations of Consultant letter SWI/HIGH/N1066/07/754 dated 24. value of work and programme for completion of balance work.1 of GCC and 11 of Contract Data to GCC) for failure to achieve the indent which is already under implementation.2007 vide Exhibit:R108 wherein on page No. (a) The contractor has to represent the specific extension of time duly specifying the quantum of work.07.MBL/2007/541 dated 02.1429 the Project Director has opined that if the present contract is to be continued the authority may conduct the high level meeting to discuss and finalize the following issues. . if any. has sought to claim damages from the Respondent under the Hudson’s Formula to reward them for their failure to complete the work under the contract on the plea of prolongation of time in the teeth of the fact that such prolongation was requested by them with the condition that no claim will be made in respect thereof as elucidated hereunder.

1351 the Claimant stated that “Neither there is any escalation clause in the contract nor we intend to ask for the same for revised indented completion date upto 31.2007 (Exhibit:R-18) to review the progress of works.2007 afterwards vide Exhibit:R-88 & 92 (Volume-19) in Page No.12. (i) An unconditional Bank Guarantee amounting to Rs.08. the extension of time will not call for any extra expenditure to NHAI on other hand NHAI will able to get the work completed by us at the old price quoted by us”.2 crores towards the liquidated damages (within 3 days) already imposed and likely to be imposed. Wherein the Contractor has requested for EOT to complete the works and NHAI had advised to submit EOT proposal through Supervision Consultants together with the following.3. have monthly milestones. .60 - .(d) The Contractor has to submit unconditional undertaking after arriving the item of works.  The Contactor has submitted request for EOT on 30.08. 2008.  Accordingly a meeting was conducted at NHAI Headquarters on 29. As such. 2007.2007. work by December. (ii) (iii) An extension of the present performance Bank A programme of work for completing the balance It was specified that the programme shall Guarantee upto August. The LD already levied will continue to be recovered. quantum of works and programme for completion of balance works and he should not arise any claim for consideration of EOT with liquidated damages.

Pursuant thereto. Claim No.09. the Claimant had categorically undertaken not to make any claims in respect thereof against the Respondent as evidenced by Exhibits C-23.) 2. In other words. In view thereof.2006).1376 (Volume-19) wherein the Claimant stated that “we don’t intend to make any claims under the subject contract (agreement dated 24. 7.00 . 5.15. Along the extension of time the Contractor has submitted an undertaking on 10.07.A-7 : Claim No. Claim No. The present untenable claim is also de hors the provisions of the Contract and hence merits summary rejection. while seeking extension of time for completion of the work till 31. That the Claimant.2007 had admitted in unequivocal terms that the said extension of time. A-7 Description loss of profit due to reduction of amount of contract which could not be executed Amount claimed (Rs.08. if granted.61 - .2007 vide Exhibit:R-95 in Page No. extension of time was granted by the Respondent reserving its rights to levy liquidated damages for the delays.978.12. R-56 and R-18. the Claimant is legally barred from making the present untenable claim against the Respondent under the doctrine of “promissory estoppel”. would be without any financial implication whatsoever to the Respondent.

While the Claimant has placed on record a proposal from the Engineer 31.141. which is purely a figment of imagination on the part of the Claimant.38. 19.1.08.65p. as well as all further contentions as recorded by the Claimant are only surmises in as much as the Claimant has failed to place on record any document in support thereof. The Minutes of the Meeting held on 29. This.62 - . That it has only been contended by the Claimant that the Claimant “came to learn that major changes would take place along the highway…”. 31.44. is bereft of any substance whatsoever in as much as the contentions. The contents of Exhibit R-18 no where state that the total requirement of routine maintenance was scaled down from Rs. which are only surmises on the part of the Claimant. are devoid of any documents in support thereof. .2007 heavily relied upon by the Claimant.2007 (EX C-57 on page 298) suggesting reduction in the scope for also failed to place on record any instructions/directions either from the Engineer or the Respondent reducing the scope or value of work required to be performed by the Claimant under the six indents as contended.10. which is already on record as Exhibit R-18 (Page -60) only refers to the programme of work to complete the balance work and makes no mention of any revised programme of work as contended by the Claimant.as contended by the Claimant. That the present claim.10. conjured by the Claimant. to Rs.60. It is a matter of record that the work under the six indents could not be completed only for reasons solely attributable to the Claimant. 117/. The extent of failure on the part of the Claimant was such that the Respondent perforce had to terminate the Contract even after levying liquidated damages. 2.

12..09. As per Contract Data to GCC of Contract Agreement Vide Page In response to the above. i) The aforesaid recommendations are not in tune with the Minutes of Meeting dated 27.26 Sl. on his own proposed revised work program and stated that under the circumstances prevailing at site. The same was recommended by the Consultant vide Exhibit:R-89 and the same was forwarded to NHAI Headquarters vide Exhibit:R-90. 19. The Claimant himself submitted the work programme on 10. 5. 4.63 - . The statement by the Claimant is no evidence in support of this untenable claim. NHAI Headquarters has pointed out vide Exhibit:R-80 that the consolidated variation statement includes VO No.41. In view of the above.12.1 “The Employer is the Chairman of NHAI”. the Claimant.2007 to 31.3. ii) The status of submission of unconditional BG of Rs. For the same.2007 for the extended period.2007 vide Exhibit:R-48 wherein the Claimant stated that update work programme for the period from 12. No. NHAI Headquarters called for certain clarification / No.09.6 having saving variation of Rs.2 Crores is not known.2007 which do not speak about any modification in the balance work.350/.79. the total value of Contract works out to Rs.3. Until an . That vide Exhibit C-56 Page-278.60 Crores.08. observation vide Exhibit:R-86 viz. the Project Director has recommended the Final Variation Order to NHAI Headquarters vide Exhibit:R-77.on account of revised work programme whereas no such revised work programme was approved or ageed.

No evidence placed on record that NHAI informed the proposal for six laning of any stretch or consequent reduction in the Contractor’s work. Reduction in contract price is a major contractual issue and unless the signatories to the Contract effect a formal amendment to the Contract. As per Clause 36 of agreement. iii) If requested by the Engineer. 6. much less any reduction in the Contract Price. the Contractor shall provide the Engineer with a detailed cost breakdown of any rate in the Bill of Quantities. Further. the agreement amount cannot be reduced or altered.. 7. the Engineer shall adjust the rate to allow for the change. the Engineer has no powers regarding alteration for scope of work until approval from NHAI.2 of agreement viz. . as per Clause 35. there can be any assumptions in this regard. There is no such formal reduction on record.approval from Chairman. ii) The Engineer shall not adjust rates from changes in quantities without the prior approval of the Employer.64 - . i) If the Final quantity of the work-done differs from the quantity in the Bill of Quantities for the particular item by more than 25 per cent provided the change exceeds 1% of initial Contract Price.

2.65 - . Accordingly this issue will be deliberated when the 20% payment under the specific clause 54 is argued before the Ld. in view of the Engineer’s said statement.AT. Contractor’s reliance on Annexure-6 of CD-III in support of this claim is also misconceived as the Engineer has clearly recorded that the Contractor did not sign the said variation orders. 10. That the above alleged claim.8. Thus. Tribunal. . Reference may also be made to Exhibits R-79 & R-80 of Volume16. In Annexure-4 of CD-III. 3. and the same is clearly beyond the terms of the Contract and for the same reason is not maintainable and/or arbitrable. by the Claimant’s own showing pertains to certain alleged losses on account of price rise due to delay in the issuance of the letter of acceptance. the Engineer has stated that he has only expressed his opinion on the amount on which the 20% recoverable from the Contractor is to be calculated and that it is subject to legal interpretation. That the contentions of the Claimant in support of the above misconceived claim are disputed and denied. 9. 1. That the Respondent has already raised its objections in respect of the present claim as identified in Para 1 of the Preliminary Objections u/s 16 (2) of the Arbitration and Conciliation Act. this issue is open for determination by this Ld. 1996. on the second page of this letter (R-58). Hence contractor cannot rely on the same.

Amount claimed (Rs. by the Claimant’s own showing pertains to certain alleged losses on account of price rise due to alleged delay in the issuance of the letter of acceptance.000 That the above misconceived claim is preposterous and de hors the Contract. reputation. the present misconceived claim does not call for any reply on merits. Claim No. That the Contract was rightly terminated by the Respondent in accordance with the terms of the Contract and the procedures stated therein and was done for reasons wholly attributable to the Claimant. the present misconceived claim does not call for any reply on merits. 3.4.A-8 : Claim No. Claim No. 1996. Description loss of Goodwill.00. That the above alleged claim. 2. 4. and the same is clearly beyond the terms of the Contract and for the same reason is not maintainable and/or arbitrable. A-8 1. That for the reasons aforestated. harassment etc. That the Respondent has already raised its objections with regard to the maintainability and arbitrability of the present misconceived claim under Para 1 of the Preliminary Objections u/s 16 (2) of the arbitration and Conciliation Act. 5.) mental 1.66 - . .00. That for the reasons aforestated.

The Claimant was well aware that the contract was for the repair and maintenance and quoted the price accordingly. disputed and denied.2009 Exhibit R-52 intimated to the Respondent that the Claimant filed VAT 2007 returns and on scrutiny of such returns they appeared to be incorrect and incomplete and requested the Respondent to withhold an amount . Claim No.67 - . The Contract entered into between the parties was the maintenance contract and under the maintenance contract it is unlikely that the work will be executed only in continuous stretches.07. any claim of the Claimant regarding the additional cost is wholly misconceived and untenable and therefore liable to be summarily dismissed. and other connected items and allowing use of 4.C. A-9 on account of additional cost due to 94.00 getting work done in 100-400 meters length in lieu of 5-10km length of B.03.5-5mtrs width Sensor Paver in lieu of 9mtrs That the contents of this Para are false.Liability for 10 submitted) Description Service Tax (to Amount claimed (Rs. Government of Andhra Pradesh vide letter dt.A.) Claim No. Claim No.) be To be borne by the Respondent That the contentions contained in this para are not correct and hence denied. Description Amount claimed (Rs.A-9 : Claim No.87.Claim No.226. Therefore.A-10 : Claim No. Commercial Tax Department.

A-11 : Claim No.2008 to Engineer and the Engineer.41. Claim No. 1996 before the Hon’ble High court of Calcutta and despite the . However.41.A-11 Description Amount claimed (Rs. the Claimant initiated proceedings under section 9 of the arbitration and Conciliation Act.) Release of bank guarantees submitted as 3. 60.00.14.1 of Contract Agreement ‘the Respondent shall perform such duties in regard to the deduction of such taxes at source as per applicable law.000/.14.02. Claim No.A-12 : Claim No. the Claimant submitted the bill on 13.) Return of original performance 3.014. in turn submitted the same to Respondent on 29. Tribunal under Respondent’s Application u/s 17 of the Arbitration and Conciliation Act. As per Clause 42.2008 Exhibit R-51.014 security for liquidated damages since expired After termination of the Contract.towards likely demand of the Commercial Taxes Department.02. Claim No.” Accordingly the withheld amount is retained by the Respondent pending further instructions by the concerned Department of the Government of Andhra Pradesh. A-12 Description Amount claimed (Rs. even while the said bill was under scrutiny.00 security bank guarantee That this is a subject matter before this Ld. Claim No.68 - .of Rs. 1996 and accordingly the above untenable claim does not call for any separate reply.

illegally allowed the Bank Guarantees provided by way of Performance Security to lapse.14. Tribunal was also constituted on 06. It is however disputed and denied that the Claimant is entitled for payment of any amount whatsoever.A. the Respondent is entitled for exemplary costs and the present misconceived claim merits rejection.014 as claimed or at all.orders for maintaining status quo given by the Hon’ble Court.69 - . Claim No. Description Amount claimed (Rs. A. the said bills of the Claimant were not processed and the above bank guarantees were also retained by the Respondent.06.) 20. Claim No.A-13 : Claim No.000. In view of the said directions of the court to maintain status Quo. the present Ld.a) Legal Charges 13 b) Cost of reference & arbitration.41.00. It is a matter of record that subsequent thereto. much less Rs. Description Amount claimed (Rs. 3. present and As per actual .00 Claim No.A-14 : Claim No. various expenditure with reference to Arbitration That the miserable failure on the part of the Claimant to execute the work under the Contract led to the present untenable disputes raised by the Claimant. In as much as the Respondent has been unnecessarily dragged into disputes with resultant costs and expenses.2008 pursuant to invocation of arbitration by the Claimant.Claim for interest for past.) Claim No.

It is a matter of record that subsequent thereto. illegally allowed the Bank Guarantees provided by way of Performance Security to lapse.02. no interest whatsoever is due or payable to the Claimant as claimed or at all. COUNTER CLAIMS OF THE RESPONDENT That the Respondent seeks to make the following Counter Claims against the Claimant: Claim Particulars Total Amount (Rs. the said bills of the Claimant were not processed and the above bank guarantees were also retained by the Respondent.2008 pursuant to invocation of arbitration by the Claimant. In view of the said directions of the court to maintain status Quo. However. the Claimant initiated proceedings under section 9 of the arbitration and Conciliation Act. the Claimant submitted the bill on 13. even while the said bill was under scrutiny.70 - . the present Ld.06. However. Tribunal was also constituted on 06. in turn submitted the same to Respondent on 29.2008 Exhibit R-51.14 future @18% per interest on all claims year compound That the Claimant is eligible only for such payments which are in accordance with the Contract as quantified after finalization of the final bill.02. it is a matter of record that after termination of the Contract. Since Claimant made it impossible for the Respondent to release even such payments to which the Claimants are eligible under the Contract.2008 to Engineer and the Engineer.) Remarks . 1996 before the Hon’ble High court of Calcutta and despite the orders for maintaining status quo given by the Hon’ble Court.

This is also a subject matter under Respondent’s Application u/s 17 before the Ld.014 The Claimant has to renew the BGs / kept the BGs in force during the arbitration proceeding as per Agreement Clause No. 6.82.Will be intimated at the end of arbitration process as per directions of the Hon’ble Arbitral Tribunal 6.028 --.71 - .25.28.14.14.R-1 In lieu of Performance security bank guarantee 3. This Counter Claim is in lieu of the performance BG’s which have been allowed to lapse by the Claimant. Since the Claimant had allowed these BG’s to lapse.41. the Respondent is eligible to realize the said amount.41. various expenditure with reference to Arbitration (details will be submitted on the last date of hearing) Total Claim (except R-3) PRAYER .014 These BGs were furnished by the Claimant in lieu of Liquidated Damages which are yet to be realized by the Respondent as per terms of the Contract.Tribunal 3.3 (e).028 R-2 In lieu of Bank Guarantees submitted as security for Liquidated Damages R-3 (a) Legal Charges (b) Cost of reference & arbitration.82.28.

Place: Date: . E.The Respondent therefore respectfully prays that the Ld. KINI & CO. Reject and dismiss Claim Nos A-2 (a. A-7 and A-8 are not maintainable or arbitrable. A-1. RESPONDENT THROUGH M. A-9. A-12. A-13 and A-14. A-6. Allow the Counter Claims of the Respondent. A-4. A-5. Pass such Order/Orders as may be deemed appropriate under the facts and circumstances of the case. A-3. c & C-1). A-10. Advocates & Solicitors KINI HOUSE 6/39. JANGUPRA B NEW DELHI – 110 014 C. A-11. B. Tribunal may be pleased to: A. D. V.72 - . b. A-2 (f). Order costs in favour of the Respondent against the Claimant. Hold that Claim Nos.

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