Yogesh Khanna, J. - (1.) The brief facts of the case are the Northern Railway was implementing the construction of Udhampur-Srinagar-Baramulla Rail Link (USBRL) Project in the State of Jammu and Kashmir. A part of the project was being constructed by Konkan Railway Corporation Limited (KRCL) on behalf of Northern Railway. The work Construction of B. G. Single line tunnel No.2 (Kotli Tunnel) from Km 33.095 to 38.450 on Katra- Laole Section of Udhampur-Srinagar-Baramulla Rail Link Project was awarded by KRCL to M/s SMS Infrastructure Ltd (the petitioner herein) vide Contract Agreement No.KR/PD/J & K/ CONT Tunnel(T-2) dated 23.01.2000 was at a cost of Rs.133,07,42,870/-. The completion period of the contract was 36.5 (thirty six and half) months upto 26.12.2006.
(2.) Upto the date of completion (DOC) i.e. till 26.12.2006 less than 10% of the work was completed, and extension was granted upto 31.12.2008 without levying any penalty. However claimants did not accept the extension up to 31.12.2008, saying any of the four options as proposed by respondent would require at least 4 years to complete the work. In view of the financial crisis faced by the petitioner and due to unsafe conditions in approach road to P2, the claimants on their own, suspended the work in May 2007. Subsequently, vide letter dated 05.10.2007 the aforesaid contract was foreclosed by KRCL (the respondent herein).
(3.) Certain disputes arose between the parties during the execution of the contract No.KR/PB/J & K/CONT./TUNNEL/T-2, dated 23.01.2004 resulting in the present arbitration proceedings.;