11 May 2021, Tuesday

4 months ago

1. Styling as an interim measure, a Section 9-court cannot make orders amounting to a final adjudication (Delhi High Court)

Edited by Prashant Mishra

11 May 2021 | National Highways Authority of India v. Bhubaneswar Expressway Private Limited | FAO (OS) (COMM) 66/2020 | Rajiv Sahai Endlaw & Asha Menon JJ

In an appeal under Section 37 ACA arising from Section 9 ACA proceedings, three main questions arose.

The first question was: what was the length of the delay in filing the appeal? The respondent suggested it should be calculated from the day of the refiling because only a bunch of papers not “relatable” to the appeal was initially filed. The argument was rejected. The court found that though grounds had been added in the refiling, documents annexed, and there was a vast difference in the number of pages, a qualitative test--not quantitative—had to be applied. The original filing had a memorandum of appeal, affidavits, vakalatnama, court fees, a certified copy of the impugned order. What had been filed constituted a proper appeal. Filing copies of documents with the appeal was only a practice that evolved to decide appeals even on the first date. Moreover, in the times of the pandemic, so many other rules had been relaxed. The overall delay, calculated from the day of the filing, was 25 days.

The second question was: was there sufficient cause to condone the delay? Held, yes, the certified copy was immediately applied for and collected. Of course, the appeal was not filed immediately “as a natural person would have taken,” but it is unrealistic not to consider factors peculiar to the functioning of the Government (though the law of limitation is the same). (Citing Nagaland v. LipokAo, (2005) 3 SCC 752).

The third question was: was the Section 9-court right in granting a mandatory order directing NHAI to release to the respondent the claimed termination payment (INR 337,73,19,434.10) subject, however, to the award and furnishing a bank guarantee. The court ruled, no, and set aside the order:

  1. Though qualified as an “interim measure”, the order is final and amounts to allowing the claim and making an award for the recovery of money. Even in a case, a party admits the other party's entitlement, a final order is the domain of the tribunal and not the Section 9-court.
  2. Grant of relief in a mandatory form is contrary to settled principles.
  3. Jetpur Somnath Tollways Ltd. v. NHAI, 2017 SCC OnLine Del 9453 was a different case. The liability was admitted (is not admitted here, even the quantum is disputed), part payment also made (not the case here) and the NHAI had withheld the balance because it wanted to adjust its counterclaim.
  4. The Section 9-court gave conclusive findings on the agreement leaving nothing to the tribunal to decide. A tribunal would hesitate in deciding otherwise, once there is a judicial finding.
  5. The judgements in Value Source Mercantile Limited v. Span Mechnotronix, 2014 SCC OnLine Del 3313 and Ajay Singh v. Kal Airways Private Limited, 2017 SCC OnLine Del 8934 cannot be read as entitling a Section 9-court to decide substantive claims.

Access the court's decision here.

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