S. No.,Particulars of Claims,"Quantified
Value (INR
Cr)
1.,"Cost incurred by Claimant on providing
supplies and services in the CHP
contracts",742.88
2.,"Overhead Cost Incurred by Claimant at
actuals (Overheads + Interest on BG)",110.41
3.,"Interest cost for works not compensated
by NTPC (12% Interest)",155.02
4.,Total Cost incurred by TSL (1+2+3),1008.30
5.,"Revised Contract Value of CHP
Contracts",670.72
6.,Claim Amount A (4-5),337.58
7.,"Claim for compensation arising out of
Loss of Profits",84.76
TOTAL CLAIM (6+7),,422.35
contracts leading to the unreasonable For the reasons stated in the application, the delay is condoned in execution of the works and significant",,
escalation in costs of the Claimant.,,
(c ) Directing the Defendant to bear all of the Claimant’s legal fees and any other cost(s) and fees relating to these proceedings, to be computed",,
at the end of the arbitration proceedings;â€,,
13. NTPC is contesting the aforesaid claims and filed its Statement of Defence. NTPC has also raised counter claims before the Arbitral Tribunal.,,
14. The impugned orders were passed in the application dated 02.09.2021 filed by TSL under Section 17 of the A&C Act. TSL had filed the said,,
application to impugn NTPC’s decision to terminate the contracts in question.,,
15. NTPC had issued notices dated 03.07.2021 alleging that TSL had failed to complete the Coal Handling Plant Package and the extended Coal,,
Handling Project within the stipulated time and had called upon TSL to cure the breach. Thereafter, NTPC had issued notices of termination dated",,
12.08.2021, terminating the aforesaid Contracts. TSL claimed that the said notices were illegal as the delay in completion of the works was entirely",,
attributable to NTPC. TSL claimed that claims made in the Statement of Claims were founded on the assertion that NTPC had delayed the execution,,
of the work and, the said dispute was an integral part of the subject matter being examined by the Arbitral Tribunal. TSL contended that since the",,
notices of termination were also premised on the allegation of delay, TSL could assail the notice of termination as its cause of action essentially",,
remained the same.,,
16. NTPC’s principal reason to terminate the Contracts in question is to proceed further by awarding the contract for the balance works to third,,
parties. Since, such an action on the part of NTPC would create third party interests to the prejudice of TSL; it claims that it was entitled to urgent",,
orders under Section 17(1) of the A&C Act.,,
17. TSL’s application under Section 17 of the A&C Act indicates that TSL relies on sub clauses (a) & (b) of Section 17(1)(ii) of the A&C Act,,
which are set out in its application. And, on the strength of the averments made in the application, TSL seeks the following reliefs:",,
“A. Allow the present application and set aside the termination of the Contracts i.e., “Coal Handling Plant Package†and “Extended Coal",,
Handling Plant Packageâ€, as the same being arbitrary and unlawful;",,
B. Pass an order restraining the Respondent from creating any third party interest in the work being executed by the Claimant pursuant to both,,
contracts;â€,,
18. NTPC is contesting the aforesaid application and had also filed an application under Section 16 of the A&C Act, inter alia, contending that the",,
disputes sought to be raised by TSL are outside the scope of arbitration and therefore, the Arbitral Tribunal did not have any jurisdiction to adjudicate",,
the same.,,
19. The Arbitral Tribunal took up TSL’s application dated 02.09.2021 under Section 17 of the A&C Act and NTPC’s application dated,,
06.09.2021 filed under Section 16 of the A&C Act for hearing on 14.09.2021. On that date, the Arbitral Tribunal passed an ad interim order, inter alia,",,
directing NTPC to maintain status quo with regard to creation of any third party rights in respect of the contracts in question till the applications were,,
decided. In addition, the Arbitral Tribunal also issued certain directions to TSL to file an affidavit providing certain details as mentioned in the said",,
order.,,
20. By the impugned order dated 29.09.2021, the Arbitral Tribunal has appointed a commissioner to record the measurements of the works executed",,
at the project site and to make an inventory of the plant and machinery, raw material, construction material lying at the site. The Arbitral Tribunal also",,
issued certain other directions for the Commissioner to follow in execution of the commission.,,
21. Mr Jain, learned senior counsel appearing for NTPC submits that the impugned orders are not in aid of the arbitral proceedings. TSL had",,
quantified its claims in the Statement of Claims and the only dispute before the Arbitral Tribunal is whether TSL is entitled to the sum of Rs. 422,,
crores as claimed by it. He further submits that the order under Section 17 of the A&C Act can be passed as an interim measure in aid of the arbitral,,
proceedings and not in aid of any further claim or any other dispute that any party may seek to raise at a future date.,,
22. He submits that in the present case, the direction to maintain status quo as to the projects and/or to direct joint measurements has no bearing on",,
the disputes before the Arbitral Tribunal.,,
23. Mr Puri, learned senior counsel appearing for the respondent countered the aforesaid submissions. He submits that the Arbitral Tribunal had",,
inspected the site and had thereafter, taken the decision that a joint measurement of the site was necessary. He, however, is unable to counter the",,
aforesaid submission that the order maintaining status quo or joint measurement of work is not relatable to the disputes pending before the Arbitral,,
Tribunal.,,
24. This Court is of the view that the reliefs sought by TSL in its application under Section 17 of the A&C Act as set out above are substantive reliefs.,,
Such reliefs are outside the scope of Section 17 of the A&C Act and cannot be granted.,,
25. The Arbitration and Conciliation (Amendment) Act, 2015 brought about significant amendments in the A&C Act, including relating to the powers",,
of an arbitral tribunal to grant interim measures of protection. The scope of Section 17 of the A&C Act as substituted is much wider than the scope of,,
Section 17 as it existed prior to its substitution. The language of Section 17 (1) of the A&C Act is similar to the language of Section 9(1) of the A&C,,
Act. Section 17(1)(ii)(e) of the A&C Act entitles a party to apply to the Arbitral Tribunal for such other interim measures of protection as may appear,,
to the Arbitral Tribunal to be just and convenient. The Arbitral Tribunal has the same powers for making orders as the court has for the purposes of,,
and in relation to any proceedings before it.,,
26. In the present case, TSL had referred to sub-clauses (a) and (b) of Section 17(1)(ii) of the A& C Act in support of its application.",,
27. It is at once clear that the relief sought by TSL is not covered under the aforesaid clauses. The preservation of the Contract is not a subject matter,,
of dispute before the Arbitral Tribunal and therefore, the prayer seeking setting aside of the notices of termination cannot by any stretch be considered",,
as orders in aid of preservation of the subject matter of the arbitration agreement. TSL’s prayer for setting aside the termination does not fall,,
within the scope of clause 17(1)(ii)(b) of the A&C Act which relates securing the amount in dispute in arbitration. As noticed above, the dispute in",,
arbitration relates to the petitioner’s quantified claim of Rs. 422 crores. The prayers made under Section 17 of the A&C Act are not for securing,,
that amount.,,
28. Undisputedly, the power of an Arbitral Tribunal to pass orders regarding interim measure or protection under Clause (e) of Section 17 (1) (ii) are",,
wide. However, they do not extend to passing orders that are not in aid of the final relief. The said clause also makes it clear that the Arbitral Tribunal",,
would have the same powers as the court has for the purposes of and relation to any proceedings. Thus, the principles that apply for grant of interim",,
orders under the Code of Civil Procedure 1908 (hereafter ‘CPC’) would also be applicable. It is well settled that an injunction under Order,,
XXXIX Rule (1) & (2) of the CPC shall be issued only in aid of the final relief. In the present case, interdiction of the termination of the contracts by",,
NTPC, does not in any manner aid the final relief as sought for by TSL in its Statement of Claims, which as noticed above, are quantified claims.",,
29. The contracts in question had been terminated and it is clear from the prayers made in the Statement of Claims that termination of the Contract is,,
not a subject matter of challenge before the Arbitral Tribunal. Plainly, TSL cannot raise a substantive dispute by way of an application under Section",,
17 of the A&C Act. In this view, the directions to NTPC to maintain status quo with regard to the projects or interdicting NTPC from awarding the",,
remaining works to other contractors are unsustainable. Insofar as joint measurement of work is concerned, the same is also not in aid of TSL’s",,
claim.,,
30. In view of the above, the appeal is allowed and the impugned orders, insofar as they direct NTPC to maintain status quo and to conduct joint",,
measurements, are set aside.",,
31. During the course of the arguments, Mr Jain had contended that in any event, in terms of the contracts in question, NTPC is bound to conduct the",,
joint measurement before handing over the site to any other contractor and NTPC would comply with this obligation.,,
32. Mr Puri also states that it would depute a responsible officer for conducting a joint inspection as and when called upon by NTPC.,,
33. NTPC is bound down to the statement made on its behalf. It is also further directed that if the exercise of joint measurement is conducted TSL,,
would fully cooperate in the said exercise, as committed by it. No further orders are required to be passed in this appeal.",,
34. It is clarified that all rights and contentions of the parties are reserved.,,
