National Highways Authority of India Vs Trichy Thanjavur Expressway Ltd. (Delhi High Court)
The Delhi High Court, in a landmark judgment delivered on August 21, 2023, in the case of National Highways Authority of India (NHAI) vs. Trichy Thanjavur Expressway Ltd. (TTEL) (Appeal Number: O.M.P. (COMM) 95/2023), delved into the power of courts to partially set aside arbitral awards. This judgement clarifies the legal landscape for challenging arbitral awards in India and sets a precedent for resolving disputes arising from such proceedings.
Background of the Case:
The National Highways Authority of India (NHAI) entrusted Trichy Thanjavur Expressway Ltd. (TTEL) with the construction of a highway project. During the project’s execution, disagreements arose between the parties regarding additional cost claims submitted by TTEL for unforeseen circumstances encountered during construction. Unable to reach an amicable resolution, the parties resorted to arbitration as per their contract.
Following deliberations, the arbitral tribunal issued an award, granting certain claims made by TTEL for additional costs. However, NHAI, dissatisfied with specific aspects of the award, challenged it before the Delhi High Court.
Issue:
- Whether the Delhi High Court could partially set aside the arbitral award issued by the tribunal.
The primary question before the Delhi High Court was whether it possessed the authority to partially set aside the arbitral award. Traditionally, courts in India were viewed as having limited options: either upholding the entire award or setting it aside in its entirety. This presented a challenge when the award contained both legally sound and potentially flawed elements.
Judgement:
