The Supreme Court of India has dismissed the cross-appeals by Reliance Infrastructure and Damodar Valley Corporation (DVC) in a case pertaining to the Rs 1500-crore arbitration award (including interest) that was in favor of the Anil Ambani’s Firm.
A Division Bench of Justices L. Nageswar Rao and B.R Gavai directed the Calcutta High Court to decide the Application made by DVC under Section 34, The Arbitration and Conciliation Act, 1996, to set aside the arbitral award, within 3 months. The Apex Court further granted DVC 4 week’s time to comply with High Court order.
DVC had moved against the single bench High Court order for directing that Reliance Infrastructure is under no obligation to furnish any fresh BGs to the PSU or to keep any of the BGs alive or renewed, whereas Reliance Infrastructure had moved against the Division Bench Order wherby it had issued Notice in DVC’s appeal and stayed the single judge’s order.
The case pertains to DVC’s 2 x 600 MW Raghunathpur thermal power project in West Bengal which was commissioned in 2012. Reliance Infrastructure was an engineering and construction contractor for the said project. The dispute arose regarding
DVC had challenged the High Court order as levy of liquidated damages for delay in completion of one unit, following which reliance had invoked arbitration.
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The three member arbitration tribunal directed DVC to pay Rs 896 crore and return the bank guarantees of Rs 354 crore within four weeks, failing which it would have to pay 15 % interest for any delay beyond 4 weeks.
Senior Advocate Harish Salve appearing on the behalf of Reliance Infrastructure submitted that DVC was not paying the award to us, because it is inconvenient for them, while Reliance Infrastructure is going bankrupt, even when the award was in their(our) favor.
Advocate appearing on behalf of DVC 4 week’s sought time to comply with the High Court order, while also seeking early disposal of Section 34 application before the Calcutta High Court.