Sannverse Railtech Private Limited vs Konkan Railway Corporation Limited
- Court
- Delhi High Court
$~33
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P.(I) (COMM.) 244/2026, I.A. 16924/2026 & I.A.
16925/2026
SANNVERSE RAILTECH PRIVATE LIMITED .....Petitioner
Through: Mr. Tarkeshwar Nath, Mr.
Anant Dev and Mr. Harshit
Singh, Advs.
versus
KONKAN RAILWAY
CORPORATION LIMITED .....Respondent
Through: Mr. Nakul Mohta, Ms. Saijal
Arora and Mr. Hitesh Nagar,
Advs.
CORAM:
HON'BLE MR. JUSTICE OM PRAKASH SHUKLA
JUDGMENT(ORAL)
% 23.07.2026
1. This is a petition filed under Section 9(1) of the Arbitration and
1
Conciliation Act, 1996 filed by the Petitioner substantially seeking
the relief of (i) Restraining/Injuncting the Respondents from taking
any action pursuant to their letter dated 19.05.2026, including levying
any damages, (ii) restraining the Respondent from invoking and/or
encashing the Bid Security Bank Guarantee dated 30.10.2025 for an
amount of Rs.2,00,00,000/- furnished by the Petitioner to the
Respondent, (iii) restraining the Respondent to issue any fresh notice
inviting tender etc.
2. Succinctly, the facts of the present case would reveal that the
2
North Easter Railways decided to undertake Civil Engineering
1
“the Act”, hereinafter
2
“NER”, hereinafter
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 1 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
Works, Electrification Works and signalling work of the new Single
Broad Gauge, line of Paniahwa-Chhitauni-Tamkuhi Road, through
EPC mode and subsequently a Tender Notice/ Request for proposal
was issued on 12.08.2025.
3
3. Apparently, a Memorandum of Understanding dated
29.10.2025 came to be executed between the Petitioner and the
Respondent to participate in the aforesaid tender floated by the NER.
In view of a term of the said MOU, a Bank Guarantee for
Rs.2,00,000,000/- was offered by the Petitioner as a Bid Security to
the Respondent, who in turn participated in the tender floated by NER
Subsequently, the Respondent was declared successful and
accordingly the work was awarded to them by NER.
4. It has been contended by the Petitioner that pursuant to the
award of the aforesaid work by NER to the Respondent, a letter dated
01.04.2026 was issued to the Petitioner for performance of the work
of the aforesaid tender on back-to-back basis.
5. Certain dispute arose between the Petitioner and Respondent,
resulting in certain delay in the submission of the performance
security by the Respondent to NER and although it has been submitted
that the Respondent subsequently submitted the performance BG and
additional BG, but since the said BGS’s were beyond time, the same
was returned by NER to the Respondent.
6. In the aforesaid conspectus of facts, this Court vide an order
3
“MOU”, hereinafter
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 2 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
dated 06.07.2026 recorded the following observations:
Admittedly, the relation between the petitioner and
“1.
respondent is by virtue of a Memorandum of Understanding dated
29.10.2025 however, this Court finds that arbitration clause is
conspicuously absent in the said MOU.
2. The petitioner has placed reliance on Clause 24 and 25 of
the Bid Document, which contains the arbitration clause between
the respondent and North Eastern Railway to contend that the
same is applicable for a dispute between the petitioner and Konkan
Railways, however, this Court does not find any subsequent
contract/agreement incorporating the said arbitration clause by
reference to adjudicate any dispute between the petitioner and the
respondent, except the letter of acceptance.
3. Even a facial reading of the letter of acceptance dated
01.04.2026 does not express that the parties were ad idem for
arbitration.
4. The supreme court in Para 22 of NBCC(INDIA) Limited vs.
Zillion Infrastructure Pvt Ltd. has held that mere reference in the
second contract to the terms and condition of the first contract, the
arbitration clause would not be ipso facto applicable unless there
is a specific mention or reference. The relevant para is reproduced
for kind of perusal
“22. As already discussed herein above, when there
is a reference in the second contract to the terms
and conditions of the first contract, the arbitration
clause would not ipso facto be applicable to the
second contract unless there is a specific
mention/reference thereto.”
5. Therefore, the petitioner has to rely on an existing
arbitration clause in order to invoke this court’s jurisdiction
section 9.
6. Upon putting a query as to the existence of an arbitral
clause between the party, the Learned Counsel for the petitioner
seeks and is granted an opportunity to satisfy the Court on the
maintainability of the present Section 9 petition in the absence of
any arbitration clause between the parties.
7. Accordingly, list this matter on 23.07.2026 for arguments
on maintainability.”
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 3 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
7. Mr. Tarkeshwar Nath, learned Counsel for the Petitioner has
submitted that the judgment of the Hon’ble Supreme Court as quoted
in the aforesaid order dated 06.05.2026 is distinguishable on facts and
in canvassing his submission has relied on the judgment of State of
4
U.P. v. Combined Chemicals Company Pvt. Ltd. .
8. As far as the Judgment of the Apex Court in State of U.P. v.
5
Combined Chemicals Company Pvt. Ltd. , is concerned, the issue in
aforesaid judgment was whether an arbitration clause contained in a
tender document became binding when no separate formal agreement
had been signed.
9. However, in the present case, dispute resolution clause is only
found in Clause 5 of the MOU dated 29.10.2025, executed between
the parties, wherein the dispute or controversies between the parties
were agreed to be settled by mutual discussion or negotiations.
Therefore, this Court is not able to find any clause, which would lead
this Court to hold that parties were in any manner ad idem for
adjudication of their dispute by the mechanism of Arbitration.
9. The learned Counsel for the Petitioner has submitted that there
exists an Arbitration clause in the tender Document/RFP executed
between the Respondent and NER and since the MOU executed
between the Petitioner and the Respondent is an outcome of the said
Tender document/RFP, the arbitration clause has to be construed to
have been borrowed into the MOU. Although, the said submission of
4
(2011) 2 SCC 151
5
(2011) 2 SCC 151
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 4 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
the learned Counsel appears to be attractive in the first blush,
however, this Court is not able to find any terms in the MOU, by
virtue of which the arbitration clause of the tender document/RFP has
been borrowed or incorporated into the MOU. Neither there is any
averment nor any submission on the part of the learned Counsel as to
how and in what manner the said arbitration clause came to be
inserted and/or transplanted into the MOU from the RFP/Tender
Document.
10. According to this Court, the judgment relied by the learned
Counsel for the Petitioner is distinguishable on the facts of the present
case, as the said judgment involved the same tender transaction and
the same parties and it did not involve an attempt to import an
arbitration clause from an independent principal contract between two
different parties ( i.e. NER and the Respondent) into a
subcontract/back-to-back contract entered between one of the parties
to the principal contract ( i.e. Respondent) with a third party ( i.e. the
Petitioner).
11. The learned Counsel for the Petitioner also sought to rely on the
6
judgment of Shinhan Bank v. Carol Info Services Ltd. , and Govind
7
Rubber Ltd. v. Louis Dreyfus Commodities Asia (P) Ltd. , to contend
that there exists an arbitration clause between the parties. However,
this court is afraid to hold it again that the ratio of the said judgment
does not support the case of the petitioner in any manner as even in
this case the agreements were executed between the same parties,
6
(2023) 20 SCC 388
7
(2015) 13 SCC 477
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 5 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
whereas in the present matter the arbitration clause is contained in the
Tender/RFP document executed between NER and the Respondent,
which contains the arbitration clause, whereas the MOU has been
executed between the Respondent and the Petitioner, wherein there is
no agreement for arbitration between them. It has to be understood
that party autonomy is the hallmark of any arbitration and in case
there is no indication in any of the documents, which would show that
the parties were ad idem for arbitration at the time of executing the
MOU, this court cannot stich an arbitration clause into the subsisting
agreement, which otherwise does not exist.
12. Since, the learned Counsel for the Petitioner is unable to point
out any document by virtue of which the arbitration clause existing in
the tender document executed between NER and the Respondent has
been sought to be incorporated or borrowed into the MOU dated
29.10.2025, either literally or by any necessary implications, this
Court is left with no alternative but to hold that there exists no
arbitration clause between the parties.
13. It goes without saying that to invoke this Court’s jurisdiction
under Section 9, there must be an arbitral clause between the parties. It
is a settled law that if there exists no arbitration agreement between
the parties, the proceedings under Section 9 of the Act are not
maintainable.
14. Accordingly, the present petition is dismissed as being not
maintainable, in the absence of any arbitration clause and liberty is
granted to the Petitioner to pursue, such other remedy as may be
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 6 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27
permissible under law.
15. Interim order, if any, stands Vacated.
16. Pending applications, if any, also stand dismissed.
OM PRAKASH SHUKLA, J
JULY 23, 2026/ gunn
Signature Not Verified
O.M.P.(I) (COMM.) 244/2026 Page 7 of 7
Signed By:GUNN
Signing Date:29.07.2026
16:55:27