MBL INFRASTRUCTURES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) I A No.13917/2017 (Exemption)

(2.) It is the case of the petitioner that it has been allotted the work of "Construction of Residential Complex for Judicial Staff at Sector- 19, Dwarka, New Delhi" under an agreement dated 07.11.2014 (hereinafter referred to as the Agreement). Stipulated date of start of construction was 08.10.2014 and the construction had to be completed by 07.04.2016. Drawing reference to the letter dated 01.02.2016 of the respondent, learned counsel for the petitioner submits that even as on that date, the respondent was not in a position to supply all the drawings that were required for the purpose of making the construction in terms of the agreement. She further submits that the petitioner, alleging default on part of the respondent, has been seeking extension of time for completion of the project and such extension has been granted in favour of the petitioner; the last extension being upto 30.09.2017. She further draws my attention to the drawing register to contend that drawings have been issued to the petitioner as late as 26.10.2017 and therefore, no default for completion of the project can be attributed to the petitioner and equally no liquidated damages can be claimed from the petitioner for such alleged default. Learned counsel for the petitioner, relying upon the judgment of Supreme Court in M/s J.G. Engineers Pvt Ltd v. Union of India, 2011 AIR(SC) 2477; Bharat Sanchar Nigam Ltd. v. Motorola India Pvt Ltd., 2009 2 SCC 337; Vishal Engineers & Builders v. Indian Oil Corporation Ltd., Manu /DE/6829/2011 and S.P. Virmani & Sons Pvt.Ltd. v. OTC Exchange of India, Manu /DE/3394/2017, submits that the respondent cannot unilaterally decide to levy liquidated damages; the question whether there was a delay in execution of the work and if so at whose account such delay was caused are the matters to be adjudicated by the arbitrator. It is further submitted that before the arbitrator the respondent also has to prove that it has suffered losses before it can claim such Liquidated Damages.

(3.) On the other hand, learned counsel for the respondent submits that in the petition no submission has been made with respect to intent to invoke arbitration. He submits that in absence of such averment, the present petition itself would not be maintainable. Further, relying upon Clauses 5.2 and 5.4 of the agreement, he submits that the causes for the delay have been examined by the "Engineer-in-Charge and these are binding on the petitioner. He further submits that Engineerin-Charge has attributed 138 days' delay on part of the petitioner. At this prima facie stage, such findings cannot be ignored. He further submits that proceedings under the Insolvency and Bankruptcy Code 2016 have been initiated against the petitioner by the creditors. He further submits that the security deposit and the performance bank guarantee that have been given under the agreement were in addition to the right of the respondent under Clause 29 of the agreement to exercise a lien on all amounts payable under this agreement.