BVSR-KVR Vs. RAIL VIKAS NIGAM LTD

JUDGEMENT

(1.) The present petition has been filed by the petitioner under Section 11(6) of the Arbitration & Conciliation Act , 1996 ("Act", for short), with the following prayers:

(2.) The petitioner is a Joint Venture comprising of M/ s BVR Constructions Pvt. Ltd. (Lead Partner) and M/s K. Venkata Raju Engineers & Contractors (Joint Partner) registered under the Indian Partnership Act , 1932. The respondent Company is Rail Vikas Nigam Limited (RVNL), which is a 100% owned PSU of Ministry of Railways, incorporated under the provisions of Companies Act , 1956. The respondent Company on February 24, 2010, under international competitive bidding, invited bids through tender notice No. RVNL/CPM/MAS/OBVPVKT/ OT-6 for "Proposed new BG line between Obulavaripalle and Venkatachalam Execution of earthwork in formation, bridges, road under bridges, Station Buildings, Staff Quarter, General Electrical Works including power line crossings from Km. 00 to Km. 17 between Obulavaripalle and Nethavaripalle in South Central Railway" ( "Project", for short). The petitioner submitted its bid, and subsequent to opening of bids by respondent Company on March 30, 2010, Letter of Acceptance ("LOA", for short) dated August 30, 2010, bearing letter No. RVNL/CPM/MAS/OBVP-VKT/OT-6, was issued in favour of the petitioner by the respondent Company. Thereafter, an agreement was entered into between the petitioner and the Chief Project Manager, Chennai, of the respondent Company on October 04, 2010 for a contract value of Rs.59,87,92,084.15/- with a contractual duration of 24 months ("Contract", for short). In terms of Clause 2 of the Contract, General Conditions of Contract ("GCC", for short) and other documents specified therein form part of the Contract.

(3.) It is the case of the petitioner that the designs and drawings furnished along with the Contract having under gone drastic deviations at the instance of the respondent Company, the scope of the contract had been altered drastically beyond comprehension, due to which various differences arose between the petitioner and the respondent Company with regard to completion of work as well as payments with regard to new rates for the increased quantities over and above the Bill of Quantities. It is averred that the petitioner continued with the work despite these issues on the assurance given by the respondent Company that all the differences / issues shall be settled amicably upon the completion of work. It is the case of petitioner that it undertook more than 90% of the work incurring huge financial losses in the process and that the respondent Company after completion of more than 90% of the work turned around and expressed their inability to remedy the grievances raised by the petitioner in an equitable manner.