Bombay High Court

Oil And Natural Gas Corporation Of India vs Ganesh Benzoplast Ltd on 3 November, 2025

  2025:BHC-OS:19900


                                                                                              CARBPL.11401.2024 .doc



                                            IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                               ORDINARY ORIGINAL CIVIL JURISDICTION

                                                        IN ITS COMMERCIAL DIVISION

                                 COMMERCIAL ARBITRATION PETITION (L) NO. 11401 OF 2024
                                                       WITH
                                      INTERIM APPLICATION (L) NO. 24424 OF 2024
                                                        IN
                                 COMMERCIAL ARBITRATION PETITION (L) NO. 11401 OF 2024

                            Oil and Natural Gas Corporation Ltd.                                ....Petitioner
                                  Versus
                            Ganesh Benzoplast Ltd.                                              ....Respondent



                            Mr. Kevic Setalvad, Senior Advocate a/w. Mr. Bhushan Shah, Mr.
                            Aakash Mehta and Mr. Gaurav Edekar i/b Mansukhlal Hiralal & Co.,
                            for Petitioner/Applicant.

                            Mr. Gautam Ankhad a/w Mr. Gaurang Jhaveri, Mr. Harsh Nishar,
                            Mrs. Vandana Bait and Ms. Iti Sharma i/b Mr. Amey Deshpande for
                            Respondent.


                                             CORAM                     : SOMASEKHAR SUNDARESAN, J.
                                             RESERVED ON           :     April 14, 2025
                                             PRONOUNCED ON :             November 3, 2025


                       JUDGEMENT:

Context and Factual Background:

1. This is a Petition filed under Section 34 of the Arbitration and

Conciliation Act, 1996 ("the Act") challenging an arbitral award dated Digitally

AARTI AARTI GAJANAN November 3, 2025 GAJANAN PALKAR PALKAR Date: Aarti Palkar 2025.11.03 12:37:11 +0530

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October 31, 2023 passed unanimously by a three-member arbitral tribunal

("Impugned Award") in connection with a contract dated July 16, 2001

("Agreement") for operation and maintenance of a 'geotechnical vessel'

("GTV") called Samudra Sarvekshak ("GTV Vessel") owned by the Petitioner,

Oil and Natural Gas Corporation Ltd. ("ONGC").

2. ONGC is an owner of multiple GTVs and multipurpose support

vessels ("MSV") for which it regularly issues contracts for operations and

maintenance, some of which have been granted to the Respondent, Ganesh

Benzoplast Ltd. ("Benzoplast"). While the Agreement covers the services

relating to the GTV Vessel, ONGC and Benzoplast also have contracts relating

to similar activity relating to MSVs. The Agreement had a tenure between

May 1, 2001 and April 30, 2004 i.e. 3 years for a value of USD ~9.42 million

inclusive of operational consumables, docking cost, service charges and the

like, excluding Customs Duty. The Agreement was but an extension of an

earlier agreement governing the same GTV Vessel expiring on April 30, 2001.

3. Although the tenure of the Agreement was scheduled to expire on

April 30, 2004, ONGC terminated the Agreement on March 22, 2003, citing a

material breach of the Agreement. The disputes and differences between the

parties led to arbitration proceedings, culminating in the Impugned Award.

There were also disputes and differences relating to maintenance of other

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vessels including MSVs and this is relevant in view of what has been

contended in these proceedings.

4. While the Petition challenging the Impugned Award entails 29

grounds, in the course of the hearing of this Petition, ONGC has focussed on

and pressed one prime ground, namely, that the Impugned Award has been

passed by a tribunal without jurisdiction in the matter.

5. The factual matrix relevant for consideration of the challenge

formulated by ONGC in the hearing may be summarised thus:-

a) The Agreement contained an arbitration clause entailing

a three-member arbitral tribunal. When ONGC came to a view that

Benzoplast had materially breached the Agreement, ONGC issued a

cure notice dated January 17, 2003 invoking Clause 1.17.2, calling

for cure within 30 days from receipt of the notice (" Cure Notice"),

failing which the Agreement would be terminated;

b) The Agreement was terminated by notice March 22, 2003

("Termination Notice"), with the termination to take effect on

March 24, 2003;

c) On July 12, 2003, Benzoplast invoked arbitration,

claiming wrongful termination. An arbitral tribunal comprising

retired judges, Justice A.M. Ahmadi, Justice K.J. Shetty and Justice

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Ajit Sengupta came to be constituted and the first meeting was held

on September 25, 2003;

d) A Statement of Claim was filed on January 28, 2004 by

Benzoplast while a Written Statement was filed in response by

ONGC on May 21, 2004;

e) On December 23 and 24, 2004, Benzoplast presented

three separate applications seeking interim relief in relation to the

GTV Vessel and two other vessels Samudra Prabha and Samudra

Suraksha;

f) ONGC expressed its willingness to refer the disputes

relating to the GTV Vessel to the 'Outside Experts Committee'

("OEC") in terms of the Agreement and called upon Benzoplast to

send a written request for the OEC within 14 days. Benzoplast too

wrote in identical terms to ONGC on the same day;

g) On October 26, 2005, a three-member OEC was

appointed comprising Mr. T.N. Seshan, Mr. R.K. Bhargava and Mr.

R.K.D Shah. On April 21, 2008, owing to resignation by Mr.

Seshan, ONGC states that the entire OEC was re-constituted to now

comprise Mr. J.L. Zutshi, Mr. G.C. Raghubir and Mr.

Surendranath;

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h) On August 4, 2008, ONGC terminated the conciliation

proceedings citing Benzoplast's disagreement to conciliate through

the reconstituted OEC and on August 26, 2008, called on the

Learned Arbitral Tribunal to resume arbitration proceedings;

i) However, on October 21, 2008, yet another OEC was

formed comprising Mr. Ishwari Dutt, Mr. T.S. Vijayaraghavan and

Mr. Surendranath and on November 10, 2008 , ONGC wrote to

Benzoplast suggesting suspension of the arbitration proceedings

pending conciliation;

j) ONGC claims that Benzoplast was not agreeable to the

new OEC and only wanted to continue with the OEC with Mr.

Seshan being replaced. The OEC did not function until October

2011 - ONGC attributes this to adjournments sought by Benzoplast

on two occasions in February 2009 and March 2009. It is stated

that in October 2011, Benzoplast sought appointment of a new

member in place of Mr. T.N. Seshan, who had resigned due to ill

health, but ONGC did not agree;

k) On March 15, 2013, Benzoplast wrote to ONGC calling

termination of the conciliation proceedings and indicating that

arbitration would be invoked. This letter was clearly in relation to

the GTV Vessel;

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l) Eventually, on June 13, 2013, Benzoplast issued a fresh

invocation notice complaining that the OEC was not being manned

and the matter was kept pending and it would be appropriate to

resume arbitration. Benzoplast appointed Justice (Retd.) Devender

Gupta as the nominee arbitrator. This notice too was clearly in

respect of the GTV Vessel;

m) On August 21, 2013, ONGC wrote to Justice (Retd.) M.S.

Rane pointing to the invocation notice dated June 13, 2013 from

Benzoplast and appointed Justice Rane " without prejudice to its

rights and contentions" as its nominee arbitrator "from ONGC's

side for adjudication of disputes / claims of M/s GBL including

counterclaims of ONGC". This was copied to Benzoplast;

n) On the same day, another letter was written to

Benzoplast, intimating that Benzoplast had terminated the

conciliation proceedings on March 15, 2013 " but without

appointing your Arbitrator in terms of Contract provision ". Since

Benzoplast had for the first time indicated in June 2013 that it had

appointed Justice Gupta as arbitrator, ONGC had also nominated

Justice Rane as its arbitrator " without prejudice to its rights and

contentions";

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o) On September 18, 2013, Justice Gupta wrote to Justice

Rane that the earlier arbitral tribunal could not have functioned

because one arbitrator passed away and the other had resigned. He

suggested that the Presiding Arbitrator of the earlier tribunal

Justice Ahmadi could be appointed as the Presiding Arbitrator by

him and Justice Rane. ONGC made a similar suggestion too by its

letter dated September 25, 2013;

p) However, this did not come about and the two arbitrators

appointed Justice (Retd.) C.K. Thakker as the Presiding Arbitrator;

q) Pleadings were filed before the Learned Arbitral Tribunal

- Statement of Claim; Statement of Defence; Counter-Claim;

replies and rejoinders to the Claim and Counter-Claim; and indeed,

pleadings in an application from ONGC claiming that Benzoplast's

claim was now barred by limitation;

r) Arbitration proceedings went on. Eventually, Justice

Rane was replaced by Justice (Retd.) J.P. Devadhar in November

2019;

s) On October 31, 2023, the Impugned Award was passed.

The contention on limitation was repelled. The contentions on the

original invocation notice not being in conformity with the

Agreement were dealt with. In a nutshell:

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i) Benzoplast's claims were partly allowed granting

recovery of USD ~1.36 million and Rs. ~28.72 lakh and

Rs. 1 crore towards costs;

ii) ONGC's counter-claim relating to short deployment

of crew by Benzoplast was allowed for Rs. ~98.32 lakhs.

This was to be adjusted against what was payable to

Benzoplast by ONGC;

iii) The rest of the claims and counter-claims were

dismissed;

iv) The net all-inclusive and adjusted amount awarded

and payable by ONGC to Benzoplast was USD ~1.36

million and Rs. ~30.40 lakhs; and

v) Post-award interest at 12% per annum was granted

from the date of the Impugned Award until realisation.

Contentions of the Parties:

6. I have heard at length, Mr. Kevic Setalvad, Learned Senior

Advocate on behalf of ONGC and Mr. Ashwani Dhatwaliya, Learned Advocate

on behalf of Benzoplast. I have perused the material on record with the

benefit of their well-referenced written submissions bearing in mind what

was pressed by them in the course of these proceedings.

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7. The core objection to the Impugned Award is based on

jurisdiction. Mr. Setalvad makes multiple points on behalf of ONGC in this

regard. According to him, the Learned Arbitral Tribunal was totally without

jurisdiction.

8. According to Mr. Setalvad, the Learned Arbitral Tribunal had been

manned by the three arbitrators who had been appointed in 2003 and had

held their first meeting on September 25, 2003. However, the very

composition of the Learned Arbitral Tribunal that rendered the Impugned

Award is patently illegal, according to Mr. Setalvad inasmuch as Justice

Ahmadi ought to have been the Presiding Arbitrator. Justice Gupta and

Justice Rane could have been respectively, substitutes for Justice Sengupta

(who had passed away) and Justice Shetty (who had resigned). Justice

Ahmadi had neither resigned nor passed away when the Learned Arbitral

Tribunal comprising Justice Thakker, Justice Gupta and Justice Rane was

formed and this in itself is a foundational infirmity.

9. According to Mr. Setalvad, although ONGC had nominated Justice

Rane to the Learned Arbitral Tribunal, ONGC had always stated that such

nomination was without prejudice to ONGC's rights and contentions.

Therefore, ONGC's participation in the arbitral proceedings right from the

constitution of the Learned Arbitral Tribunal to the filing of pleadings and

making of submissions before it could not come in the way of a jurisdictional

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infirmity of the Learned Arbitral Tribunal. Therefore, Mr. Setalvad would

contend, the commencement and continuation of arbitral proceedings were

illegal.

10. The other core contention of Mr. Setalvad is that of limitation.

According to him, the termination of the agreement was on March 22, 2003

while the second invocation notice leading to the constitution of the Learned

Arbitral Tribunal was issued ten years later. According to Mr. Setalvad, this

cannot be saved by reliance upon Section 77 of the Act to exclude time spent

on conciliation from the period of limitation because the conciliation

proceedings commenced after the first arbitral tribunal was formed while it is

the second arbitral tribunal that was constituted ten years later to consider

claims barred by limitation. In aid of this contention, Mr. Setalvad would

contend that there are distinct differences in the content of the first

invocation notice and the second invocation notice and the latter cannot be

regarded as a continuation of the former.

11. Mr. Dhatwaliya, on behalf of Benzoplast would contend that

ONGC's contentions are completely untenable. He would point to the record

to indicate that the first arbitral tribunal was unavailable. Justice Shetty had

resigned, Justice Sengupta had passed away, and in fact, Justice Gupta had

recommended to Justice Rane that since Justice Ahmadi was available, the

two arbitrators appoint him. He would indicate that ONGC could have well

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supported this view at the relevant time but there is nothing to show that it

did. It is apparent, he would contend, that it was ONGC's nominee arbitrator

who did write back stating that the two nominee arbitrators would appoint

the third arbitrator. Therefore, it is apparent that the two arbitrators do not

appear to have had consensus on Justice Ahmadi.

12. For its part, Mr. Dhatwaliya would submit, Benzoplast had in fact

recommended appointment of Justice Ahmadi but it was ONGC that was

opposed to Justice Ahmadi being the presiding arbitrator. He would point to

a letter dated September 25, 2013 by which Benzoplast urged ONGC to

proceed with appointment of Justice Ahmadi as the presiding arbitrator so

that the long-pending proceedings could resume. That apart, he would

submit, it was for ONGC to have taken up such an objection before the

Learned Arbitral Tribunal, which it did not. No issue has been framed on this

subject, and this objection is purely an afterthought that is not found in the

record. Merely pointing to have appointed Justice Rane "without prejudice"

to ONGC's rights is of no consequence, Mr. Dhatwaliya would contend.

13. As regards limitation, Mr. Dhatwaliya would submit that the

parties were meant to engage in conciliation and work before the OEC

comprising Mr. Seshan had been underway. All that ONGC had to do was to

replace Mr. Seshan on his resignation but they appointed another OEC and

this has wasted time. The Learned Arbitral Tribunal has dealt with the issue

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of limitation raised by ONGC and has also returned plausible findings on

limitation and on merits, and does not deserve any intervention by this Court

under Section 34 of the Act.

ANALYSIS AND FINDINGS:

14. I have examined the record and the findings of the Learned

Arbitral Tribunal in the Impugned Award. A few foundational facts are clear

as daylight in the matter. The disputes and differences between the parties

originally covered not just the GTV Vessel but also three MSV Vessels. ONGC

had decided to terminate the contracts relating to all four vessels.

Composition of Tribunal and Invocation:

15. The disputes and differences between the parties in relation to the

three MSVs were resolved through the conciliation process and the parties

even executed a settlement agreement dated March 13, 2010 with a payment

of Rs. 15.26 crores by ONGC representing a full and final settlement. On

December 6, 2011, it was claimed by Benzoplast that the acceptance of

settlement had been under duress and in fact the recommendation for the

settlement amount had been in excess of what had been disclosed.

Arbitration was sought to be re-initiated on the premise that the settlement

was vitiated by non-disclosure and had not been in the spirit of the

settlement. A Learned Single Judge of this Court firmly repelled this

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contention when faced with an application under Section 11 of the Act on the

premise that ONGC was not appointing its nominee arbitrator. A challenge

to the same in the Supreme Court also was not entertained leaving open the

pursuit of any action available in law. This led to a Civil Suit having been

filed, which is pending.

16. In sharp contrast, in relation to the pending dispute in connection

with the GTV Vessel, ONGC nominated Justice Rane as its nominee

arbitrator. It is also clear that Benzoplast had indicated that Justice Gupta

was appointed in place and stead of Justice Sengupta who had passed away.

ONGC nominated Justice Rane but there was no expression of shock or

surprise since it was clear that the arbitration was pending in relation to

disputes connected to the GTV Vessel. ONGC has indeed used the phrase

"without prejudice to its rights and contentions " in its letter to Justice Rane

nominating him but all this does is to enable ONGC to raise the objection it is

now raising when the Learned Arbitral Tribunal actually conducted

proceedings. There is nothing on record to show an application under

Section 16 having been filed. On the contrary, Mr. Setalvad relies on the

letter dated August 21, 2013 written by ONGC to Justice Rane and the

incantation of the phrase "without prejudice to its rights and contentions ".

Thereafter, this is not an issue that appears to have been raised before the

Learned Arbitral Tribunal.

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17. In fact, the issue of the Learned Arbitral Tribunal not having

jurisdiction by reason of Justice Ahmadi not being the Presiding Arbitrator is

not part of the issues framed. There is nothing on record to show that this

issue was proposed by ONGC and was not framed and that ONGC protested.

It is quite apparent that this argument is completely an afterthought to attack

the Impugned Award. Benzoplast had indeed desired that Justice Ahmadi be

the Presiding Arbitrator as is seen from its submissions and in its letter to

ONGC. That Justice Gupta desired that Justice Ahmadi be the Presiding

Arbitrator is also clear in his letter to Justice Rane. Today, ONGC claims that

the only approach ought to have been for Justice Ahmadi to have been the

Presiding Arbitrator. There is not a whisper on the record as to why ONGC

did not pursue this line even when it was positively requested by Benzoplast.

After the Learned Arbitral Tribunal was constituted and ONGC participated

in it including by filing a Counter-Claim and when the framing of issues does

not indicate this was raised, in my opinion, it is late in the day to come up

with this novel argument at the stage of proceedings under Section 34 of the

Act.

18. In fact, the objection is inexplicable. Even while ONGC indicates

that under Section 16(2) of the Act there is an outer limit to raise a

jurisdictional objection, all Mr. Setalvad could allude to, for indicating the

objection before such statutory deadline, is ONGC's letter to Justice Rane

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asserting that he was being appointed without prejudice to its rights. If its

rights were intended not to be prejudiced by making the appointment, that

right should also have been exercised after the Learned Arbitral Tribunal was

constituted by filing an application under Section 16 of the Act. In my

opinion, this objection is wholly devoid of merit and deserves to be firmly

rejected.

Limitation:

19. The other objection raised on behalf of ONGC is that of limitation.

There are two facets to this objection. One is that it is the invocation notice of

June 13, 2013 that led to the Learned Arbitral Tribunal being constituted.

This was issued ten years after the termination of the Agreement. The other

facet is that claims sought to be pursued have to be made known in the

invocation notice "and not thereafter" in terms of the explicit language in the

arbitration clause contained in the Agreement. A comparison of the

Statement of Claim filed before the Learned Arbitral Tribunal would show

that there was more in it compared with the Statement of Claim filed before

the first arbitral tribunal. Therefore, there is no scope to rely on the first

invocation notice for such claims as now pursued, which would then mean

that they are barred by limitation.

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20. This too has to be stated to be rejected. The Learned Arbitral

Tribunal has examined these contentions. The Learned Arbitral Tribunal has

noticed the provisions of Section 77 of the Act, which are extracted below:-

77. Resort to arbitral or judicial proceedings.-- The parties shall not initiate, during the conciliation proceedings, any arbitral or judicial proceedings in respect of a dispute that is the subject-matter of the conciliation proceedings except that a party may initiate arbitral or judicial proceedings where, in his opinion, such proceedings are necessary for preserving his rights.

[Emphasis Supplied]

21. In the instant case, the facts are clear. The parties had a dispute.

They initiated arbitration. After the first meeting and fixation of schedule for

arbitration, they went in for conciliation before the OEC. While the OEC

before which the disputes relating to the GTV Vessel did not gain traction, the

OEC seized of the disputes relating to the three MSVs resolved the disputes.

The parties even executed a settlement agreement. Indeed, there was a

dispute about how consent for the settlement had been obtained but that is a

different matter. When refusing to refer to arbitration renewed disputes over

the three MSVs, a Learned Single Judge of this Court, by an order dated

September 28, 2012 firmly held a view that the OEC proceedings constituted

conciliation proceedings under the Act. That view was not interfered with by

the Supreme Court. What is clear is that the time spent before the OEC was

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time spent in conciliation and that too by consent of the parties. It is

apparent that ONGC sought to suspend the proceedings pending

consideration by the OEC. When Mr. Seshan could not continue, ONGC

sought to replace the entire OEC instead of replacing him. This was not

accepted and the conciliation was called off and arbitration resumed.

22. I have examined the letter nominating Justice Gupta and the

correspondence from advocates of Benzoplast with ONGC and

correspondence between Justice Gupta and Justice Rane. There is no doubt

that the dispute pursued in the arbitration was over the termination of the

Agreement governing the GTV Vessel. That was suspended and resumed.

ONGC is unable to explain why it did not do contemporaneously, what it is

canvassing today i.e. accept Justice Ahmadi as the Presiding Arbitrator. That

said, the Learned Arbitral Tribunal came to be formed but to continue the

arbitration that had already been invoked. A close reading of the Statement

of Claim filed before the Learned Arbitral Tribunal would show that the claim

is indeed about the termination of the Agreement. Section 77 prohibited

filing of the Statement of Claim when conciliation was underway. Once it was

put to bed, the Statement of Claim was filed.

23. The attempt to invoke the observation of the Supreme Court in

Geo Miller1 does not carry ONGC's case any higher. As set out in Paragraph

Geo Miller & Co. (P) Ltd. Vs. Rajasthan Vidyut Utpadan Nigam Ltd. - (2020) 14 SCC 643

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28 of that judgement, indeed, the Learned Arbitral Tribunal is required to

examine the negotiation history which must be pleaded and placed on record.

The Learned Arbitral Tribunal has done exactly that and found the breaking

point in the negotiations. Benzoplast wrote to ONGC to continue with the

OEC with a replacement for Mr. Seshan and when ONGC did not respond,

Benzoplast called off the conciliation and immediately nominated Justice

Gupta. Benzoplast always considered him to be a replacement for Justice

Sengupta, and it is the complexity added by ONGC having been (then)

desirous of a different Presiding Arbitrator that is now being sought to be

made the ground to challenge the composition. In any event, the findings of

the Learned Arbitral Tribunal on the facet of limitation and the interplay with

the conciliation efforts is a plausible view that must not be lightly interfered

with.

24. The above findings of the Learned Arbitral Tribunal cannot be

regarded as perverse at all. They speak to the facts and the material on

record. The Learned Arbitral Tribunal has compared the Statement of Claim

filed on January 28, 2004 before the Learned Arbitral Tribunal in its earlier

composition and the Statement of Claim filed before the Learned Arbitral

Tribunal on January 1, 2014. The Learned Arbitral Tribunal repelled the

contention that the first invocation notice had not quantified the claim and

therefore the quantification now being made is time-barred. The Learned

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Arbitral Tribunal found that the arbitration clause does not require a

quantification of claim. The dispute raised related to the assault on the

termination as illegal and that continued. The Act permits even a Statement

of Claim to be amended and supplemented. Benzoplast indicates that the

invoices raised until then had formed subject matter of the earlier invocation.

The Learned Arbitral Tribunal is right in its eminently plausible view that

merely quantifying the claim amount does not constitute a new claim not

made earlier.

25. What is strange is that when ONGC is raising the issue of the claim

being time-barred it has chosen to file a Counter-Claim before the Learned

Arbitral Tribunal, which the Learned Arbitral Tribunal has rightly held to be

maintainable.

Findings on Merits:

26. The Learned Arbitral Tribunal has also ruled on the limited tender

that had been issued by ONGC to replace Benzoplast during the life of the

relationship. Holding that the limited tender relating to the MSV's was

outside the scope of consideration of these arbitral proceedings, the Learned

Arbitral Tribunal has returned a clear plausible finding that the limited

tender in relation to the GTV Vessel had been issued without waiting for the

cure period, indicating a premediated mind to replace Benzoplast. This was

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also held to have sent a signal to the business community that Benzoplast was

in breach of obligations owed to ONGC. It was found that ONGC had acted in

undue haste to replace Benzoplast replacing with Shipping Corporation of

India. Examining the material on record including the reports of various

committees forming part of the evidence and the conduct of the parties, the

Learned Arbitral Tribunal, which is the master of the evidence and the final

forum for finding of facts has returned a clear unanimous view that the

termination of the Agreement was illegal and not tenable.

27. The Learned Arbitral Tribunal then went on to assess the

quantified claims and counter-claim components and returned the final

findings on what is owed by ONGC to Benzoplast and by Benzoplast to ONGC

to award the net amount as being payable by ONGC to Benzoplast. A number

of claims raised by both sides have also been rejected with reasons.

Loss of Profits:

28. What is assailed on behalf of ONGC is the award for loss of profit

that is said to be in conflict with Clause 18A of the Agreement, which is said

to bar consequential losses. The contention made today in the Section 34

proceedings about Clause 18A of the Agreement being a bar on award of loss

of profits does not find mention at all in the arbitral proceedings.

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29. The Written Submissions filed before me invokes Clause 18A of the

Agreement and alludes to this objection having been taken in the Statement

of Defence at Page 557 of the Petition. However, a reading of Page 557 of the

Petition would indicate that there is not even a whisper that consideration of

loss of profit is barred by contract. Therefore, the invocation of Ssangyong

Engineering2 is of no avail to ONGC since there is no basis for ONGC to

contend that the Learned Arbitral Tribunal misinterpreted the contract and

considered what was outside its scope of consideration. It was not even the

case of ONGC that Clause 18A of the Agreement rendered the consideration

of loss of profit as a consequential loss, for the Learned Arbitral Tribunal to

have been able to interpret this clause and return a finding. The contention

not having been taken before the Learned Arbitral Tribunal, it is not

appropriate for me to delve into whether loss of profit is necessarily a

consequential and indirect loss or whether it is a direct loss.

30. The objection based on Clause 18A is evidently yet another

afterthought brought to bear with hope to sustain the challenge to the

Impugned Award under Section 34 of the Act - quite similar to the

contention about the composition of the Learned Arbitral Tribunal and the

need to have had Justice Ahmadi as the Presiding Arbitrator (when ONGC

had not responded to the very same request from Benzoplast to have Mr.

SSyangyong Engg. & Construction Co. Ltd. V. NHAI - (2019) 15 SCC 131

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Ahmadi approved as the Presiding Arbitrator). The Statement of Defence

takes the stand that the termination not being illegal, there can be no claim.

That apart, the contention is that no loss having been suffered, there can be

no claim for loss of profit. This generic defence is now sought to be presented

as a cogent and specific objection relating to Clause 18A of the Agreement, to

contend that the Impugned Award is outside the scope of the Agreement.

31. I am afraid such an approach is unacceptable. There is nothing in

the contentions pressed before me that necessitates setting aside the

Impugned Award.

Scope of Review under Section 34:

32. I cannot lose sight of the scope of jurisdiction under Section 34 of

the Act - it is well covered in multiple judgements of the Supreme Court

including Dyna Technologies3, Associate Builders4, Ssyangyong, Konkan

Railway5 and OPG Power6. Even implied reasons that are discernible, may be

inferred by the Section 34 Court, to support the just and fair outcome arrived

at in arbitral awards. To avoid prolixity, I do not think it necessary to burden

this judgement with quotations from these judgements.

Dyna Technologies Private Limited v. Crompton Greaves Ltd - (2019) 20 SCC 1

Associate Builders vs. Delhi Development Authority - (2015) 3 SCC 49

Konkan Railways v. Chenab Bridge Project Undertaking - 2023 INSC 742

OPG Power vs. Enoxio - (2025) 2 SCC 417

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33. Suffice it to say (to extract from just one of the foregoing), in Dyna

Technologies, the Supreme Court held thus:

"24. There is no dispute that Section 34 of the Arbitration Act limits a chal- lenge to an award only on the grounds provided therein or as interpreted by various courts. We need to be cognizant of the fact that arbitral awards should not be interfered with in a casual and cavalier manner, unless the court comes to a conclusion that the perversity of the award goes to the root of the matter without there being a possibility of alternative interpretation which may sustain the arbitral award. Section 34 is different in its approach and cannot be equated with a normal appellate jurisdiction. The mandate un- der Section 34 is to respect the finality of the arbitral award and the party autonomy to get their dispute adjudicated by an alternative forum as provided under the law. If the courts were to interfere with the arbitral award in the usual course on factual aspects, then the commercial wisdom behind opting for alternate dispute resolution would stand frustrated.

25. Moreover, umpteen number of judgments of this Court have categorically held that the courts should not interfere with an award merely because an al- ternative view on facts and interpretation of contract exists. The courts need to be cautious and should defer to the view taken by the Arbitral Tribunal even if the reasoning provided in the award is implied unless such award portrays perversity unpardonable under Section 34 of the Arbitration Act."

[Emphasis Supplied]

November 3, 2025 Aarti Palkar

CARBPL.11401.2024 .doc

Conclusions:

34. To summarise:-

a) There is nothing wrong much less patently illegal in the

composition of the Learned Arbitral Tribunal;

b) The conduct of proceedings by the Learned Arbitral

Tribunal cannot at all be regarded as ex facie illegal as is being

contended by ONGC;

c) Far from there being an absence of waiver, ONGC did not

even file an application under Section 16 of the Act before the

Learned Arbitral Tribunal. Mr. Setalvad's reliance on the phrase

"without prejudice to its rights and contentions" in the letter from

ONGC to its nominee arbitrator does not constitute a

jurisdictional objection being raised before the Learned Arbitral

Tribunal. At best it is an assertion of rights generically, which

never translated into an actual attempt to enforce its perceived

(and reserved) right;