AHLUWALIA CONTRACTS (INDIA)LTD Vs. RELIANCE INFRASTRUCTURE LIMITED

JUDGEMENT

(1.) This is a petition under Section 9 of the Arbitration and Conciliation Act (for short 'the Act') whereby the petitioner prays for the following interim reliefs pending the arbitral proceedings:-

(2.) Briefly the facts are :-

(3.) Respondent no.1 has appeared and has also filed reply affidavit of Mr.Omkar Raut, Senior Manager (Legal). In the affidavit, respondent no.1 has contended that the petitioner does not make out any case for an injunction on invocation of bank guarantee and that in fact the petition is a gross abuse of the process of the Court. Respondent no.1 has contended that the petitioner has suppressed material facts in seeking discretionary reliefs. Respondent no.1 contends that by a letter of award dated 17 May 2010 and subsequent work order dated 29 May 2010, respondent no.1 awarded the contract for Civil Works 2 (Package 2) in respect of 6X660 MW Sasan Ultra Mega Power Project, Sasan, Madhya Pradesh, to the petitioner for a composite sum of Rs.103,28,53,998.54/- (excluding taxes) and for which the Performance Bank Guarantee and the first and second Advance Bank Guarantees were furnished by the petitioner. It is stated that the petitioner was required to complete the entire contractual work within a period of 31 months from the notice to proceed dated 19 May 2010 that complete the same by 20 December 2012. It is the case of respondent no.1 that the petitioner failed to complete the work awarded within the stipulated time period. It is stated that there was substantial delay in mobilization and deployment of resources by the petitioner, as also inadequate resources were deployed at site, the milestones envisaged as per the project schedule were not achieved. Respondent no.1 has contended that during the execution of the project, respondent no.1 time and again highlighted these issues and communicated specific requirements to the petitioner interalia for deployment of additional manpower and resources. Respondent no.1 has stated that respondent no.1 was constrained to revise and reduce petitioner's scope of work and various packages, that were to be undertaken by it were offloaded to third parties. It is stated that in addition to the petitioner's failure, respondent no.1 was constrained to issue 24 amendments/revisions to the main work order. It is stated that consequent to this offloading, the contract value awarded to the petitioner was reduced to Rs.70,98,22,818.75. In paragraph 10 of the reply affidavit, respondent no.1 contends that the balance advance of Rs.7,58,00,296/- being 10% of Rs.71,54,49,368/- is yet to be recovered from the petitioner by respondent no.1 which can be recovered from the first and second Advance Bank Guarantees. It is contended that the petitioner left the contractual work incomplete and did not even make payments to the labour and/or sub-contractors engaged by it, creating serious unrest at the project site. This was informed by respondent no.1 to the petitioner on 27 August 2013. Respondent no.1 also was constrained to release additional payments to the extent of Rs.1,01,00,000/- in September 2013 in order to bring the situation under control at the Project site. This was the amount which is originally due and payable by the petitioner to his workers and which respondent no.1 had become entitled to recover. Respondent no.1 in reply affidavit has further stated that on the petitioner's failure and abandonment, respondent no.1 was also required to engage the services of third party contractors to complete the work forming part of the petitioner's scope of work. It is stated that respondent no.1 has placed various work orders on third party contractors amounting to Rs.4,92,67,608.5 and was also required to pay the said amounts. These amounts are therefore to the account of the petitioner.