The Delhi High Court recently observed that re-adjudication of the same issue is contrary to public policy and the courts must ensure that a litigant is not made to face the same kind of litigation twice over [Jaiprakash Associates Ltd Vs NHPC Ltd]..Justice Subramonium Prasad made the observation while delivering a judgment on a petition filed under Section 11 (appointment of arbitrator) of the Arbitration and Conciliation Act, 1996 by Jaiprakash Associates."The principle that a party cannot be permitted to re-adjudicate the same issue is based on public policy. The Courts of competent jurisdiction have to ensure that no one should be made to face the same kind of litigation twice over as such a process is contrary to fair play and justice," the Court observed. .The dispute centered around delays during the construction of the Dulhasti Hydro Electric Project on the Chenab River in Jammu and Kashmir. Originally, the project was awarded to another contractor. It was later undertaken by Jaiprakash Associates Limited, which signed a contract with NHPC Ltd in 1997. The project, initially slated for completion within 33 months, faced significant delays and was completed only in 2007.Jaiprakash Associates Limited (petitioner) sought ₹360.56 crores as additional costs for extended site occupation but NHPC Ltd rejected the claim. The matter was referred to arbitration, where the tribunal acknowledged the lack of evidence for the petitioner’s claims but still awarded ₹60 crores on the basis of "good conscience and reasonable estimation." In 2023, the High Court set aside the award, citing contradictions in the tribunal’s reasoning..Jaiprakash Associates subsequently sought the appointment of a new arbitral tribunal, arguing that the earlier proceedings failed to resolve the core dispute. The company cited legal provisions under the Arbitration and Conciliation Act which allows fresh arbitration if an award is set aside.NHPC Ltd opposed the petition on the ground that the claims had already been adjudicated and the petition was mala fide. It argued that revisiting the issue would waste public and private resources and that arbitration should not be used to revive "dead claims.".The High Court dismissed the plea for fresh arbitration.It emphasised the importance of finality in dispute resolution and referred to the Supreme Court’s judgment in SBI General Insurance Co. Ltd. v. Krish Spinning.“Allowing such claims to go forward would be a waste of resources and an improper use of the arbitration process, which is meant to resolve only those disputes that are legally viable,” the Court said. .The Court added that the present case was one where it ought to interfere to prevent wastage of resources. "The present matter falls in the category where ‘legitimate interference’ is necessitated and to prevent wastage of public and private resources. Applying the ‘eye of the needle’ test, this Court has no hesitation is observing that the prima facie scrutiny of the facts of the present case, leads to a clear conclusion that there is not even a vestige of doubt that the claim is non-arbitrable," it said. .The Court added that it is the duty of the referral court to ensure that parties are not forced to arbitrate a matter which is demonstrably non-arbitrable. It thus dismissed the petition under Section 11 for the appointment of an arbitrator. .Jaiprakash Associates Limited was represented by Senior Advocate Lovkesh Sawhney and advocate Rohit Kumar.NHPC Ltd was represented by advocates Gauhar Mirza (Partner), Hiral Gupta (Principal Associate), Sukanya Singh (Senior Associate), Rohit Rahar (Associate) and Devarshi Mohan (Associate) from Cyril Amarchand Mangaldas..[Read Judgment]
