The National Highways Authority of India (NHAI) has won a significant arbitration case related to the six-laning of the Kamrej–Chalthan section of NH-48 in Gujarat, with the Arbitral Tribunal rejecting nearly the entirety of a ₹174.49 crore claim raised by the contractor. Against those claims, the Tribunal awarded just ₹54 lakh — less than one-third of one per cent of the amount sought — resulting in substantial savings of public funds, according to an official statement issued on Friday, 8 May 2025.

Background of the Project

The dispute centred on the widening of the 15-km Kamrej–Chalthan section of NH-48 from four lanes to six lanes, which also included long-term remedial measures for four black spots on the Kamrej–Bharuch corridor. The project was awarded in June 2016 to contractor SCIW–Unique Construction (JV) in engineering, procurement, and construction (EPC) mode at a bid cost of ₹241.41 crore. Work was formally scheduled to begin on 21 March 2017, with 87.75% land availability declared at the time.

How the Contract Fell Apart

During execution, the contractor repeatedly cited land-related constraints and demonstrated persistently slow progress, failing to meet contract provisions. Only basic road and drainage work was carried out; critical components including major structures and flyovers were never taken up. Owing to continued performance deficiencies, the contract was mutually foreclosed on 11 May 2020 at a physical progress of approximately 49.79%. At the time of foreclosure, both parties had agreed that all claims were fully and finally settled, and the contractor had expressly undertaken not to raise any future claims.

The Arbitration Challenge

Despite the foreclosure agreement, the contractor initiated arbitration proceedings in 2022, claiming approximately ₹174.49 crore from the NHAI — a move that was contrary to the terms of the settlement already signed. The NHAI contested the claims vigorously, presenting detailed documentary and digital evidence before the Arbitral Tribunal. This included drone videography, digital project records, and technical documentation demonstrating that sufficient land had been available for the six-laning works and that substantial drainage work had already been completed along the right of way. The evidence further established that the contractor had failed to undertake the key and challenging components of the project, which significantly contributed to the foreclosure.

Tribunal's Award and What It Signals

In its award dated 10 March 2025, the Arbitral Tribunal virtually rejected all claims made by the contractor. Against the ₹174.49 crore sought, the Tribunal awarded only ₹54 lakh to the claimant. The outcome underscores the critical role of digitisation and technology-driven project monitoring in infrastructure dispute resolution. Notably, this is among the most lopsided arbitration outcomes in recent NHAI history — with the contractor recovering less than 0.31% of its claimed amount.

NHAI's Broader Commitment

The NHAI stated that the result reflects its commitment to contractor accountability, prudent contract management, and protection of public funds. The authority added that robust documentation practices, including drone-based surveillance and digital records, are now integral to its project monitoring framework. The case is likely to serve as a precedent in future infrastructure arbitration proceedings involving state highway agencies, reinforcing the evidentiary weight of digital monitoring tools in contract disputes.