Prolongation Compensation Can't Be Granted If The Contractor Didn't Reserve Claim For Compensation At The Time Of The EOT: Delhi High Court

The Delhi High Court has held that no compensation can be awarded for the prolongation of the contract if the contractor did not reserve its right to such compensation at the time of the seeking Extension of Time. They ruled that the Tribunal's decision, which denied the prolongation cost due to the Contractor's failure to reserve this right during the EOT request, and because the EOT was granted without financial implications, is a plausible view which does not warrant intervention by the Court using its powers under Section 34 of the A&C Act. Aggrieved by this finding, the petitioner challenged the award under Section 34 of the A&C Act Grounds of Challenge The petitioner challenged the award on the following grounds: The finding of the arbitral tribunal suffers from the vice of patent illegality inasmuch as, the tribunal while limiting the compensation to six months, returned a perverse finding that in seeking EOT on the first, second and fourth occasion, the Contractor had not reserved its right to seek compensation, which amounted to a waiver. The Court held that the tribunal did not disallow the claims on the grounds of any prohibition in the contract but due to petitioner’s own waiver of the right to claim compensation, that happened in the first, second and fourth EOT sought by it.