Synopsis

NHAI challenged an arbitral award that allowed the respondent’s claim for additional costs arising from changes in rates of Minimum Alternate Tax (MAT), Fringe Benefit Tax (FBT), and Service Tax under a Concession Agreement (BOT project). The High Court set aside the award, holding that: (i) the respondent failed to lead any evidence to prove that the enhanced taxes were actually paid; mere tabulated statements were insufficient; (ii) the award was unreasoned as it did not discuss the material evidence or address NHAI’s defences (including notifications claiming no service tax was leviable); (iii) the award was perverse and patently illegal. The court did not decide the limitation issue or the interpretation of “change in law” clauses.

Court: High Court of Delhi at New Delhi

Coram: Hon’ble Mr. Justice Avneesh Jhingan (Single Judge)

Date of Judgment: 6th May 2026

Citation: O.M.P. (COMM) 263/2018 (2026:DHC:3831)

Core Law: Arbitration and Conciliation Act, 1996 – Sections 34, 31(3); Patent illegality, perversity, unreasoned award.

1. Heading of the judgment

High court of delhi at new delhi

O.m.p. (comm) 263 of 2018 & i.a. 3084 of 2023

National highway authority of india (petitioner) vs. Gmr highways ltd (respondent)

Coram: hon’ble mr. justice avneesh jhingan

Judgment reserved on: 28th april, 2026; pronounced on: 6th may, 2026

2. Legal framework

Major laws and provisions involved:

• Arbitration and conciliation act, 1996 – section 34 (setting aside award), section 31(3) (requirement of reasoned award)

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