Supreme Panvel Indapur Tollways Private Limited v. National Highways Authority of India

9. The following provisions of the Specific Relief Act, 1963 [hereinafter, “SRA”], as amended by Act 18 of 2018, have been cited in the impugned order and referred to in the course of hearing: “CHAPTER II: SPECIFIC PERFORMANCE OF CONTRACTS Section 10. Specific performance in respect of contracts: - The specific performance of a contract shall be enforced by the court subject to the provisions contained in sub-section (2) of section 11, section 14 and section 16. Section 14. Contracts not specifically enforceable: - The following contracts cannot be specifically enforced, namely: - (a) where a party to the contract has obtained substituted performance of contract in accordance with the provisions of section 20; (b) a contract, the performance of which involves the performance of a continuous duty which the court cannot supervise; Emphasis supplied.

(c) a contract which is so dependent on the personal qualifications of the parties that the court cannot enforce specific performance of its material terms; and

(d) a contract which is in its nature determinable.

Section 20A. Special provisions for contract relating to infrastructure project: - (1) No injunction shall be granted by a court in a suit under this Act involving a contract relating to an infrastructure project specified in the Schedule, where granting injunction would cause impediment or delay in the progress or completion of such infrastructure project. Explanation:- For the purposes of this section, section 20B and clause (ha) of section 41, the expression “infrastructure project” means the category of projects and infrastructure Sub-Sectors specified in the Schedule.

CHAPTER VII: INJUNCTIONS GENERALLY Section 36. Preventive relief how granted: - Preventive relief is granted at the discretion of the court by injunction, temporary or perpetual.

CHAPTER VIII: PERPETUAL INJUNCTIONS Section 38. Perpetual injunction when granted: (2) When any such obligation arises from contract, the court shall be guided by the rules and provisions contained in Chapter II. Section 41. Injunction when refused: - (ha) if it would impede or delay the progress or completion of any infrastructure project or interfere with the continued provision of relevant facility related thereto or services being the subject matter of such project.”

10. Section 20A and Section 41 (ha) of SRA have inter alia been inserted by the 2018 amendment. Section 10 has also been substituted for the following pre-amendment provision: - “Section 10: Cases in which specific performance of contract enforceable: - Except as otherwise provided in this Chapter, the specific performance of any contract may, in the discretion of the court, be enforceda) when there exists no standard for ascertaining actual damage caused by the non-performance of the act agreed to be done; or b) when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief. Explanation: - Unless and until the contrary is proved, the court shall presume-

(i) that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money; and

(ii) that the breach of a contract to transfer movable property can be so relieved except in the following cases: - (a) where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market; (b) where the property is held by the defendant as the agent or trustee of the plaintiff.”

IV. Findings of the Tribunal:

11. The Tribunal has rendered the following prima facie findings:a. It noted that, pursuant to the infusion of funds by the respondent under the OTFIS, Review Committee meetings were held which reflect that the appellant was unable to achieve the committed targets.[3] b. The minutes of the 21st OTFIS meeting on 24.01.2020 concerned replacement of the Engineering, Procurement and Construction [hereinafter, “EPC”] contractor by the appellant for part of the project and revised estimate of balance works. The Tribunal noted the appellant’s failure to infuse further funds, leading to its request dated 30.04.2020 for infusion of further funds by the respondent.[4] c. Lack of sufficient funding led to repeated requests by the appellant to the respondent for additional funding and unsatisfactory performance of the project by the appellant. Noting the minutes of various meetings of the OTFIS Review Committee, the Tribunal found that the appellant has been unable to demonstrate that it has the necessary funds and wherewithal to complete the project. 5 d. Although the appellant has invested a large amount in the project, the respondent has also infused significant funding but the progress of the project remained dismal even thereafter. While reserving the question of responsibility for this situation for decision at the stage of final adjudication, the Tribunal noted that the appellant has accepted the slow progress of the work in Paragraph 50 of the impugned order. Paragraph 52 of the impugned order. Paragraphs 53 and 54 of the impugned order.

OTFIS meetings and even requested for suspension of the project by a communication dated 10.08.2021.[6] e. The Tribunal also found prima facie against the appellant on the question of issuance of Provisional Commercial Operation Date [hereinafter, “PCOD”] under Clause 14.3.[2] of the CA. It noted that the appellant had accepted that no street lighting had been provided and that unrefuted photographs show that the road was not in a workable condition.[7] f. Even if PCOD had been issued, the appellant could not have been in a position to achieve Commercial Operation Date [hereinafter, “COD”] within 90 days as required by Clause 14.[4] of the CA, as it did not have sufficient funds to complete the project.[8] g. In the context of amendments to Sections 14, 20A and 41(ha) of the SRA, the Tribunal observed that the CA being determinable, is incapable of specific performance by virtue of Section 14(d) of the SRA. It is a commercial contract which can be determined and terminated, under Clause 37 of the CA, by either side on occurrence of conditions mentioned therein. 9 Paragraphs 53 and 55 of the impugned order. Paragraph 56 of the impugned order. Paragraph 57 of the impugned order. Paragraphs 61-64 of the impugned order. h. If the determination of the CA is ultimately found to be illegal, the aggrieved party would have to be compensated by payment of damages.10 i. The grant of stay of termination which has been in operation since 17.11.2021, at this stage, when the appellant has already been dispossessed from the project, would amount to final relief being granted at the interim stage.11 j. On the basis of above discussion, the Tribunal came to a conclusion that the appellant may have an arguable case but it does not have a strong prima facie case warranting stay of termination. The loss and injury, if any, suffered by the appellant was also found to be compensable in money.12 k. Having regard to the requirement of expeditious conclusion of the project, the balance of convenience cannot be said to be on the side of the appellant.13

12. Recording the aforesaid prima facie findings, the Tribunal has made it clear that the final adjudication of the case will be dependent upon the material adduced at trial and the Tribunal would, if it finds in favour of the appellant, grant such reliefs as the appellant is entitled to in law. Paragraphs 63 and 64 of the impugned order. Paragraphs 54 and 68 of the impugned order. Paragraph 72 of the impugned order. Paragraph 73 of the impugned order.

13. Having rejected the appellant’s application on the aforesaid reasoning, the Tribunal concluded by noting, nevertheless, that the appellant had invested a huge amount in project and achieved more than 88% physical progress. It, therefore, suggested that the parties may attempt to arrive at a mutually acceptable resolution having regard to the fact that even in the course of arbitration proceedings, the parties had made an attempt to settle the matter amongst themselves.14

14. The final observations of the Tribunal were, in fact, the starting point of the proceedings before this Court. As noted in the orders dated 02.11.2022 and 11.11.2022, learned Senior Counsel for both parties accepted the suggestion of the Tribunal and attempted to achieve a consensus. The appellant also expressed a desire to introduce a proposed investor. Regrettably, their attempts to resolve the matter mutually have been unsuccessful and I have, therefore, proceeded to hear the appeal on merits.

V. Submissions:

15. Mr. Jaideep Gupta, learned Senior Counsel for the appellant, submitted that the Tribunal has erred in finding the prima facie case established by the appellant to be insufficient for grant of interim relief. He pointed out that the appellant had admittedly completed 88% of the physical progress of the work. He emphasised that, in a BOT contract, the concessionaire makes the investment in the project in consideration of the right to operate the highway and collect toll for the concession period. In a case such as the present one, where the Paragraphs 77-79 of the impugned order. agreement is terminated on the verge of project completion, the termination has the consequence of depriving the appellant of consideration altogether. The threshold for applying for PCOD being 75% of project completion, the petitioner in fact applied for PCOD on 10.11.2021. Mr. Gupta submitted that, instead of considering the petitioner’s case for issuance of PCOD certificate, the respondent proceeded to terminate the CA altogether. He further submitted that the act of the respondent in terminating the CA without consideration of the appellant’s request for issuance of the PCOD, in fact, deprives the appellant of its right to collect toll revenue and is a mala fide attempt by the respondent to appropriate the revenue which would otherwise be available to the appellant to recoup its investment.

16. Mr. Gupta pointed out that the respondent itself had extended the time for completion of the project from time to time, including lastly by an order dated 11.08.2020, upto 31.03.2021. He submitted that in these circumstances, the respondent also agreed to continue the project as is evident from the fact that the respondent did not act upon the NITT dated 16.10.2020 until the impugned termination letter, issued 13 months thereafter.

17. Learned Senior Counsel submitted that a Public Interest Litigation [PIL No. 19/2021] has been instituted before the Bombay High Court, in which the High Court is monitoring the status of the project. Mr. Gupta referred to an affidavit filed by the respondent before the Bombay High Court on 15.11.2021, which inter alia states as follows:- “3. I further to say that the Four- Laning of Panvel- Indapur started in the year 2012 and was scheduled to complete during June

2014. The Project got delayed due to various issues i.e. Financial crisis being face by the Concessionaire, delayed handing over of encumbrance-free land including land belonging to Railways and Salt Pan Department, delay in shifting of various utilities, NBWL clearance for the eco-sensitive zone fo Karnala (20 Km length) received in October 2015.Diversion of forest land in December 2016, removal of encroachments. Majority of encroachments removed by March 2016, Long monsoon period, Public demand for various additional facilities and Poor performance by the Concessionaire. When aforesaid issues were mostly resolved and work is restarted in January 2017 with one time fund infusion (OTFIS) of Rs.540 Cr. by the NHAI. The Concessionaire has awarded the work from Km 0+000 to 38+000 (38 km in length) to EPC Contractor M/s JMM Infra Pvt Ltd. and From Km 38+000 to 84+600 (46 km in length) no EPC Contractor deployed by the Concessionaire up to October-2018. In November-2018 work from Km 38+000 to 64+300 (26 km in length) was awarded by the Concessionaire to M/s JMM Infra Pvt Ltd and in march-2019 work from Km 64+300 to 8.4+600 (20.60 km in length) to MD Infra / Rameshwar Construction. The Concessionaire has already carried out the works amounting of Rs. 540 Cr. and further funding of about 67 Cr. is required to complete the work required for achieving Provisional Commercial Operational Date (PCOD). l further say that with regards to other contentions raised referring to the Affidavit dated 25.08.2021 filed by this Respondent, it is necessary to mention here that Respondent by their affidavit has apprised this Hon'ble Court about the slow progress made in the their stretch along with difficulty faced with regard to finance and other financial constraints faced by the Concessioner. Based on the assurances given by the lenders during the VC held on EPC on 20.04.2021, whereby an additional funding of Rs.40 Crores was to have finalized within 10 to 15 days from the date of the said meeting. However, the assured, fund has not been infused by the lender Bank till date. The provisional completion is likely to be achieved by December 2021 subject to availability of the working season and the Concessioner arranging the funds. Going by the assurances given and the availability of working season and funds, the completion date may be expected by 31.03.2022. As far as the present status is concerned, the stretch is in motorable condition prior to the monsoon. However, due to damages occurred during the heavy rains and heavy vehicular traffic in certain sections, there were some patches, potholes and waterlogging which are being filled up with Paver blocks & Bituminous material. In addition to this, two dedicated Ambulances and Patrol vehicles are made available at 0+000 (Kharpada) & Km. 66+000 (Sukheli) so as to take care of emergency situations and safeguarding of the road users.

4. I say that repair and maintenance work on the Highway Project on the stretch from Panvel -Indapur section is being done regularly under the supervision of an independent Engineer and the Authority. I say that Respondent has issued intention to Termination Notice to the Concessionaire for slow progress of work, in October, 2020. However, thereafter, it was considered not to proceed for termination of the contract on assurance given by Lenders to infuse funds of Rs. 40 Cr. for achievement of PCOD. I say that till date physical progress is 88.08% of the work on the aforesaid section is complete.”15 Mr. Gupta submitted that the affidavit discloses that the respondent had decided not to act on the basis of the NITT dated 16.10.2020 and at the very least, was required to give a fresh notice in due compliance of the termination provisions. He submitted that the Tribunal has failed to consider the appellant’s argument with regard to the staleness of the cure notices issued by the respondent in the year 2017 vis-à-vis the NITT dated 16.10.2020 and, in turn, of the long period between the issuance of the said notice and the actual termination. Mr. Gupta relied upon a judgment of a coordinate bench in EFS Facilities Services (India) Pvt. Ltd. vs. Indeen Bio Power Limited16, to contend that consideration of the said material would have led to a different conclusion which in itself is a ground for interference with the impugned order in appeal.

18. With reference to the provisions of the SRA, as amended by the Amendment Act of 2018, Mr. Gupta submitted that the nature of specific performance as a discretionary remedy, to be granted only when monetary compensation would not afford adequate relief, has been done away with by the substitution of erstwhile Section 10(b) of the SRA. This is also reflected in the amendment to Section 14 whereby the bar on specific performance in such situations has been removed. He argued that the Tribunal’s analysis, to the extent that it considers whether damages would afford sufficient compensation to the appellant if it ultimately succeeds, is erroneous on this count.

19. Mr. Gupta further submitted that, in the context of a BOT contract, the finding of the Tribunal that damages would be adequate to compensate the appellant is also erroneous. He reiterated that such an approach condones a complete failure of consideration, as the only consideration available to a BOT contractor in return for its investment is the ability to operate the highway and collect toll revenue. He relied upon a decision of a coordinate bench in West Haryana Highways Projects Pvt. Ltd. vs. National Highways Authority of India 17, wherein the Court granted an injunction against suspension of a BOT contract upon a detailed consideration of the questions of balance of convenience and irreparable injury.

20. With regard to Section 20A of the SRA, also inserted by the 2018 amendment, Mr. Gupta submitted that the injunction sought by the appellant does not fall foul of the prohibition contained therein as the appellant wishes to make a proposal which would not cause impediment or delay in the progress or completion of the contractual Judgment dated 07.10.2020 in OMP(I)(COMM) 144/2020 and connected cases. work. He contended that the proposal of the appellant, which includes an introduction of an investor willing to put in over ₹150 crores to complete the CA, would obviate any apprehension that the progress of the CA would suffer, if an injunction were to be granted. In this connection, he also stated that after the impugned termination, the respondent has appointed an EPC contractor whom the appellant is also willing to use for the purpose appointed to enable continuity, and that the appellant would be willing to perform such additional work, if any, for which the respondent has issued notice inviting tenders, pursuant to the impugned termination.

21. Mr. Parag P. Tripathi, learned Senior Counsel for the respondent-NHAI, submitted that the arguments advanced on behalf of the appellant are beyond the scope of scrutiny of this Court under Section 37 of the Act. He emphasised that the appellate jurisdiction under Section 37 is limited to a finding that the view taken by the Tribunal is capricious or perverse. In this connection, Mr. Tripathi cited the decisions of the Supreme Court in Printers (Mysore) Private Ltd. vs. Pothan Joseph18 and Wander Ltd. and Anr. vs. Antox India (P) Ltd.19, and the decisions of this Court in Green Infra Wind Energy Ltd. vs. Regen Powertech Pvt. Ltd.20, Sona Corporation India Pvt. Ltd. vs. Ingram Micro India Pvt. Ltd. & Anr.21, Sanjay Arora & Anr. vs. Rajan (1960) 3 SCR 713.

Chadha & Ors.22 and Manish Aggarwal & Anr. vs. RCI Industries and Technologies Ltd..23

22. Without prejudice to this contention, Mr. Tripathi supported the decision of the Tribunal on all three facets relevant to grant of interim injunction i.e. prima facie case, balance of convenience and irreparable loss.

23. With regard to prima facie case, Mr. Tripathi submitted that although 88% of the physical progress of the project had been completed, the appellant was repeatedly in breach of the timelines for project milestones. He submitted additionally that the appellant’s failure to infuse the requisite funds for project completion had correctly been noticed by the Tribunal, and that the appellant was also in violation of its obligations with regard to operation and maintenance of the highway. He referred to the OTFIS progress reports and the independent engineer’s [hereinafter, “IE”] reports placed on record, to submit that the project was at a virtual standstill since July, 2021 which led to the decision to terminate. With regard to the appellant’s contention regarding the issuance of the PCOD, Mr. Tripathi referred to Clauses 14.3.[1] and 14.3.[2] of the CA to emphasise that PCOD issuance is not an automatic consequence of 75% completion of the project but dependent upon the fulfilment of various conditions, including requirement for testing in terms of Clause 14.1.

24. Mr. Tripathi referred to the orders dated 07.03.2022 and 10.10.2022 passed by the Bombay High Court in PIL No. 19/2021 to point out that the Division Bench found the pace of progress of the project disappointing and also had occasion to comment upon the stand of the respondent before this Court in the proceedings under Section 9 of the Act.

25. With regard to the apparent inconsistency between the stand taken in the affidavit dated 15.11.2021 filed by the respondent before the Bombay High Court, as opposed to the termination two days later, Mr. Tripathi submitted that the assurances given to the Bombay High Court with regard to provisional completion by December, 2021 and final completion by 31.03.2022 were expressly conditional upon availability of working season and funds being arranged by the appellant. He further submitted that the affidavit itself makes it clear that the respondent’s decision not to proceed with termination on the basis of the NITT issued in October, 2020 was based on an assurance by the appellant’s lenders that they would infuse funds of ₹40 crores for achievement of PCOD. According to Mr. Tripathi, these funds were not infused. Upon a query of the Court with regard to the failure of the respondent to inform the Bombay High Court in the said affidavit of any decision having been taken to terminate the CA with the appellant, Mr. Tripathi submitted, on examining the records of the respondent, that the decision had been taken earlier in October, 2021 but was somehow not communicated to the deponent of the affidavit so as to be placed before the Bombay High Court.

26. On the question of balance of convenience, Mr. Tripathi distinguished the decision of this Court in West Haryana Highways 24 on facts. He submitted that the said decision was based on the PCOD already having occurred and the highway being operational, on the finding that the NHAI was responsible for delay and on the fact that the impugned order in that case was one of suspension rather than final termination of the CA. He also submitted that in the facts of the present case, the perspective on the question of the balance of convenience would be different as the respondent had also invested a significant amount in the project.

27. Mr. Tripathi refuted the appellant’s submission with regard to the staleness of the cure notices and/or of the NITT on the ground that these are ultimately issues which will fall for final adjudication before the Tribunal, and cannot form the basis of appellate interference with the Tribunal’s assessment of prima facie case. He submitted that the cure notices and NITT were sent strictly in terms of the CA and the respondent’s failure to act immediately would not disentitle it to terminate the CA in the face of the appellant’s continued noncompliance with contractual provisions. The position of the appellant having become untenable, it was submitted that the respondent was well within its contractual right to terminate. Supra (note 17).

VI. Analysis:

28. The first question to be considered in the light of these submissions is with regard to the scope of this Court’s jurisdiction under Section 37(2)(b) of the Act. Mr. Tripathi submitted that the appellate power under Section 37(2)(b) of the Act is to be exercised in limited circumstances, relying upon four decisions of this Court.25 Although the aforesaid judgments have been rendered upon a consideration of the limitations on judicial interference in arbitration proceedings, reliance has been placed upon the judgment of the Supreme Court in Wander26, which is not a decision emanating from arbitration proceedings, but qualifies the extent of the general appellate power available under the Civil Procedure Code, 1908. The Supreme Court held, relying upon its earlier decision in Printers (Mysore) Pvt. Ltd.27, as follows:

29. The first of the judgments of this Court, cited by Mr. Tripathi, dealing with the power under Section 37(2)(b) of the Act is Green Infra Wind Energy Ltd.29 wherein a coordinate bench of this Court relied upon Wander30 to hold that appellate power cannot be exercised in the absence of a finding that the discretionary order of the tribunal was perverse or contrary to law. The Court also noticed the decisions Supra (note 20). of this Court in Ascot Hotels and Resorts Pvt. Ltd. vs. Connaught Plaza Restaurants Pvt. Ltd.31 and Bakshi Speedways vs. Hindustan Petroleum Corporation.32 The aforesaid decision was followed by another coordinate bench in Sona Corporation India Pvt. Ltd.33

30. In Dinesh Gupta and Ors. vs. Anand Gupta and Ors.34, this Court considered the matter with reference to Section 5 of the Act and the generally limited nature of the Court’s power in arbitration proceedings, to conclude as follows:

31. The aforesaid approach has also been taken in Augmont Gold Pvt. Ltd. vs. One97 Communication Ltd.36 and in Sanjay Arora37. In the latter case, the Court went on to hold as follows:

32. In Manish39, the Court relied upon Section 5 of the Act and the decision in Dinesh Gupta40 to hold as follows:

33. Mr. Gupta suggested that the observations of this Court in the aforesaid judgments, particularly those equating jurisdiction under Section 37 with jurisdiction under Section 34 of the Act, may be somewhat overstated. He relied upon the judgment of the Supreme Court in Government of Maharashtra vs. Borse Brothers Engineers and Contractors Pvt Ltd.42 to submit that there is, in fact, significant difference between Section 34 and Section 37 of the Act. Borse Bros.43, however, does not really concern the scope of appellate power but the question of limitation. That the provisions are not identical in all respects is also clear from judgments of this Court. For instance, Augmont44 makes it clear that the Court can under Section 37 of the Supra (note 23). Supra (note 34).

Ibid. Supra (note 36). Act modify an order while it is constrained under Section 34 of the Act either to uphold an award or set it aside.45

34. In any event, the judgments of this Court, quoted above, are binding upon me. Be that as it may, I am of the view it is not necessary in the context of the present case to examine this issue in greater detail as Mr. Gupta also readily accepts that the power of the Court would be circumscribed by the general appellate power in cases arising out of discretionary interlocutory orders. For this purpose, the guidance available in judgments of the Supreme Court in Printers (Mysore)46 and Wander47 is sufficient. Wander itself enjoins considerable circumspection in the appellate court’s interference with discretionary interlocutory orders, limited to the narrow category of cases enumerated in paragraph 14 of the judgment.48 This is the basis of the reasoning in Green Infra Wind49 and Sona Corporation50 also. The latter judgments of this Court add an additional line of reasoning based on the provisions of the Act, and a purposive interpretation thereof. However, at least for the present purposes, there is, in my view, little difference in the conclusion, regardless of the perspective from which the matter is approached. Paragraph 74. Supra (note 18). Extracted in paragraph 28 above. Supra (note 20). Supra (note 21).

35. In the light of the circumspect approach mandated by the aforesaid judgments, I do not find any reason to interfere with the decision of the Tribunal in the facts and circumstances of the present case. Although the Tribunal has recognized that the appellant has already completed more than 88% of the physical progress of the CA, it has recorded prima facie factual findings with regard to the appellant’s inability to provide sufficient funding for the completion of the project, repeated requests for additional funding from the respondent and the unlikelihood of issuance of the PCOD and COD within the stipulated time. These findings are based upon a consideration of several minutes of OTFIS Review meetings, and the factual material placed before it. A perusal of the documents demonstrates that the Tribunal’s prima facie findings are supported by the materials on record, which include the following: a. In the 5th OTFIS meeting held on 16.10.201751, the Committee noted that the appellant “could not achieve the committed targets during the period from April 2017 to September 2017 and the progress of work is extremely poor in section-II.” It was also pointed out that there was meagre deployment of resources and that since there was a failure to achieve the targeted progress, one month cure period notice should be issued by the IE. 5th OTFIS meeting dated 16.10.2017 at document-5 of the respondent’s list of documents. b. The IE wrote a letter dated 08.11.2017 to the appellant highlighting that no progress was being made in the project and the appellant had not replaced its EPC contractor, despite IE advising to do so earlier. It was also pointed out that there were maintenance and safety issues on the site that were not being attended by the EPC contractor deployed by the appellant.52 c. In the 8th OTFIS meeting dated 01.01.201853, the Committee noted that there was no progress in Section-II of the project since September 2017 and that there was no deployment of manpower and machinery in Section-II. d. In the 9th and 10th OTFIS meeting held on 06.02.2018 and 13.03.2018 respectively54, the Committee noted that the appellant was not “showing any interest in the project” as none of the assurances given by it in the previous meetings were being fulfilled. e. In the 14th OTFIS meeting held on 25.08.201855, the Committee noted that the appellant had not been able to deploy adequate resources despite availability of sufficient cash flow. Therefore, it was decided in the meeting that the Committee will recommend issuing an NITT under the provisions of the CA. Paragraph 50 of the impugned order. 8th OTFIS meeting dated 01.01.2018 at document-8 of the respondent’s list of documents. 9th OTFIS meeting dated 06.02.2018 and 10th OTFIS meeting dated 13.03.2018 at document-9 and 10 of the respondent’s list of documents respectively. 14th OTFIS meeting dated 25.08.2018 at document-14 of the respondent’s list of documents. f. The appellant wrote a letter to the IE on 10.08.2021 recommending invocation of Clause 36.[1] (suspension) by the respondent “with a view to get the balance work completed to achieve the Provisional Completion for the project for a maximum period of 180 days from the date of invocation of such clauses.”56 g. In response to the appellant’s request for PCOD dated 11.11.2021, the IE wrote a letter on 16.11.2021 stating that it was unlikely that PCOD could be achieved by 30.11.2021 because there was insufficient deployment of machinery and manpower by the appellant to achieve PCOD, rectification of work at the PCOD location was moving at a slow pace, there was a lack of clarity on funding for the PCOD and there were outstanding dues of EPC contractors which had not been cleared by the appellant. 57 The Tribunal’s findings, in the light of these materials on record, cannot be said to be arbitrary or perverse.

36. Mr. Gupta’s submission that the termination of the CA without consideration of the appellant’s request for PCOD itself renders the termination illegal or mala fide also does not commend to me, at least at this stage. It may be noted that even according to the appellant, it applied for PCOD only on 10.11.2021, whereas according to the Letter dated 10.08.2021 from the appellant to the respondent at document-30 of the respondent’s list of documents. Letter dated 16.11.2021 from the IE to the appellant at document-9 of the appellant’s list of documents. material placed on record, it had achieved 75% physical progress by May, 201958. This lends credence to Mr. Tripathi’s submission that the grant of PCOD was not contingent merely upon 75% completion of the work but upon satisfaction of various other conditions as stipulated in Clause 14.[3] of the CA. The Tribunal’s prima facie findings with regard to testing, non-availability of streetlights and the condition of the road support its conclusion that the appellant has not been able to make out a prima facie case of entitlement to PCOD.

37. It is also important to point out that Mr. Gupta’s arguments regarding the sequence of events leading to termination of the CA on 17.11.2021 focus on the fact that cure notices were sent by the respondent to the appellant in 2017, following which the NITT was issued only on 16.10.2020 and the termination letter was issued 13 months thereafter on 17.11.2021. While these are certainly matters to be considered by the Tribunal at the final hearing, I am unable to find a strong prima facie case in favor of the appellant on this count. Clause 47.[6] of the CA specifically supports Mr. Tripathi’s stand that mere forbearance with continued nonperformance, would not disentitle the respondent from terminating the CA. What does, however, appear quite incongruous is that the respondent filed an affidavit before the Bombay High Court only on 15.11.2021 in which the imminent termination was not dealt with. Mr. Tripathi has sought to offer some explanation for this situation, but it is a matter which Independent engineer’s report at page 1223 of appellant’s list of documents (It may be noted that, at least for the present purposes, the factual context of the said report was not disputed by the appellant.) will ultimately fall for the decision of the Tribunal, if raised by the parties before it.

38. In the light of the specific findings returned by the Tribunal, I am also unable to accept Mr. Gupta’s submission relying upon the judgment in EFS Facilities59. The analysis of the Tribunal with regard to the prima facie case made out by the Appellant is sufficiently detailed and reasoned, on the basis of the material before it. Keeping in mind the level of scrutiny required at the stage of consideration of interlocutory relief, the decision cannot be charecterised as perverse or arbitrary on the ground urged.

39. On the question of balance of convenience and irreparable injury also, I do not find the Tribunal’s findings to be vulnerable to interference. Mr. Gupta emphasised that the SRA, after its amendment in 2018, does not provide for adequacy of damages as a bar to specific performance. While that is undoubtedly so, a consideration of balance of convenience and irreparable injury remain part of the trinity of tests that the Court must apply before granting an interim injunction. In consideration of these questions, the adequacy of monetary compensation may, in given circumstances, inform the Court’s assessment. The Tribunal has expressly held that if the appellant is ultimately found, on evidence, to have established its case that the termination was illegal, consequential relief as available to it in law would follow. Mr. Tripathi did not, in the course of arguments in this appeal, suggest that the appellant would be disentitled to Supra (note 16). compensatory damages, although the extent of such compensation would naturally depend upon the contractual provisions and the evidence placed before the Tribunal.

40. With regard to the judgment of this Court in West Haryana Highways 60, I notice that factually, in that case, the PCOD certificate was already granted in favour of the concessionaire and the highway was operational when the impugned suspension order was passed by the NHAI.61 There was also an arbitral award dated 29.08.2019, whereby NHAI was found responsible for the delay in execution of the project.62 It is in the context of these facts that the Court found the suspension of the concessionaire’s right to collect toll to be unjustified, pending arbitration. The Court noted that the project was executed at the cost of the concessionaire.63 Even in such circumstances, while staying the suspension letters issued by the NHAI, the Court in fact reserved the NHAI’s right to terminate the contract in accordance with the CA.64 The Court also declined the concessionaire’s request to stay notices inviting tender for repair and maintenance work on a part of the concerned highway.

41. In the aforesaid important aspects, the facts before the Court in West Haryana Highways 65 were quite different from those subsisting in the present case, where the highway is not operational and the PCOD has not been issued. The undisputed facts are also, as noted by Paragraph 8 of the judgment. Paragraph 9 of the judgment. Paragraph 58 of the judgment. Paragraph 57 of the judgment. the Tribunal, that the highway has in fact been taken over by the respondent pursuant to the termination notice and grant of the relief sought in the application under Section 17 of the Act would in fact require the appellant to be put back in possession thereof. Significantly, in the present case, the respondent’s infusion of significant funds is also a distinguishing factor from the case in West Haryana Highways66.

42. Mr. Gupta also submitted that an assessment of balance of convenience must take into account the fact that the appellant is a special purpose vehicle constituted only for the purpose of the subject project. He submitted that a deprivation of the right to collect toll would potentially lead to a complete collapse of the appellant’s business, perhaps even disabling it from taking the ongoing litigation to its logical conclusion. In the context of the present case, I am unable to accept this submission. In the face of the Tribunal’s findings on the questions of prima facie case and the public interest in the project being completed, as well as the bar incorporated in Section 20A and Section 41(ha) of the SRA, this is not a sufficient ground to reverse the Tribunal’s finding on balance of convenience.

43. On the question of determinability of the contract, which concededly remains a ground to deny specific performance, the Tribunal relied upon the decisions of the Supreme Court in Indian Oil Corpn. Ltd. vs. Amritsar Gas Service & Ors.67 and of this Court in Ibid.

Inter Ads Exhibition Pvt. Ltd. vs. Busworld International68 and Bharat Catering Corporation vs. Indian Railway Catering and Tourism Corporation Ltd.69 To the extent that the judgment of the Division Bench in Bharat Catering Corporation70 specifically holds that a contract which has already been terminated ought not to be restored pending arbitral proceedings, the said decision militates against the grant of injunction to the appellant.

44. Mr. Gupta’s attempt to meet the requirements of Section 20A and 41(ha) of the SRA by proposing a workable solution for the continued implementation of the project also does not persuade me to a contrary conclusion. As noted above, both the Tribunal in the concluding paragraphs of its judgment, and this Court in the initial proceedings in this appeal, considered it appropriate to require the parties to attempt a mutually acceptable resolution in the interest of the project. It appears that there remains a significant variance in their respective understanding regarding the quantum of funds required to avoid impediment or delay in the progress or completion of the project. In such circumstances, for the Court to stay the termination requires a substantive review of the requirements and a satisfaction that the appellant’s proposal is sufficient to overcome the bar of Section 20A of the SRA. The appellant has not been able to satisfy the Court on this count, to an extent which would persuade the Court to

VII. Conclusion

45. For the aforesaid reasons, I am of the view that the impugned order is not liable to interference by this Court in the exercise of jurisdiction under Section 37(2)(b) of the Act. The appeal, alongwith pending applications are, therefore, dismissed. There will be no orders as to costs.

46. It is made clear that the observations in this judgment are only for the purposes of disposal of this interlocutory appeal and will not prejudice the parties in the final adjudication of their respective contentions before the Tribunal.