Judgement of the Day-Gammon India ltd & ors v National highways authority of India

Judgment dated 23rd june, 2020 case number- O.M.P (COMM) 392/2020

Facts-

A contract was executed between Gammon and National Highways Authority of India for some work. The Project was not executed within the prescribed time. Extensions for completing the Project were granted. The Contractor invoked arbitration clause. There were 3 claims. Various disputes inter alia with respect to delay in execution of the project and encumbrances on the land arose between the parties under the contract during execution of the project. Each of these disputes were referred to three different Arbitral Tribunals (“Tribunal 1”, “Tribunal 2” and “Tribunal 3”) in 2005, 2007 and 2008 respectively, leading to three separate awards.

Issue- 1. Whether multiple claim and multiple reference to arbitration at multiple stages is permissible from a single contract under the provisions of the Act?

Decision-

The Court cautioned against multiplicity of proceedings. Multiple proceedings will not only defeat the purpose of speedy dispute resolution but also be inherently counter-productive. Although the provisions of Civil Procedure Code, 1908 do not strictly apply to arbitration proceedings, the principle of Res Judicata is still applicable to arbitration proceedings. Keeping in mind the broad principles which are encapsulated in Order II Rule 2 CPC, as also Section 10 and Section 11 of the CPC, which would by itself be inherent to the public policy of adjudication processes in India, it would be impermissible to allow claims to be raised at any stage and referred to multiple Arbitral Tribunals, sometimes resulting in multiplicity of proceedings as also contradictory awards.”

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