SC dismisses NHAI's plea against Chinese firm
The Supreme Court on Monday dismissed National Highway Authority of India's (NHAI) plea seeking to extend the bank guarantee of Rs 40 crore furnished by China Coal Construction Group Corporation for a road project in Uttar Pradesh.
By PTI |
NEW DELHI: The Supreme Court on Monday dismissed National Highway Authority of India's (NHAI) plea seeking to extend the bank guarantee of Rs 40 crore furnished by China Coal Construction Group Corporation for a road project in Uttar Pradesh.
A vacation bench comprising Justice Arijit Pasayat and Justice P P Naolekar dismissed the petition seeking extension of the date of Performance Bank Guarantee, which expired on June 16.
NHAI had challenged the Delhi High Court's order refusing to extend the bank guarantee for a work contract on National Highway-2 in the state during the pendency of appeal.
Senior counsel Mukul Rohtagi, appearing for NHAI, said China Coal had failed to execute the contract and the bank guarantee furnished by it should be extended or renewed till the appeal is disposed off by the High Court.
"The respondent being a foreigner has no property or other assets within the territory of India, out of which the outstanding dues could be recovered if the bank guarantee is not allowed to be extended till the final adjudication of the Appeal under Section 37 of the Act," NHAI said in its plea.
The amount recoverable from China Coal cannot be compensated by encashing the bank guarantee toward mobilisation and machinery advances alone, it said.
China Coal had furnished three bank guarantees totalling Rs 157.55 crore for four laning and strengthening of a section of National Highway-2 in March 2002. However, both NHAI and China Coal had terminated the contracts in June 2004.
The arbitration tribunal had rejected NHAI's claims as unjustified and contrary to the contract.
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