**Executive Summary**
The National Highways Authority of India (NHAI) successfully defended an arbitration claim of Rs. 174.49 crore regarding the NH-48 widening project in Gujarat. Despite a mutual foreclosure in May 2020 and a prior agreement to waive future claims, the contractor initiated arbitration in 2022. On 10th March 2026, the Arbitral Tribunal awarded the contractor only Rs. 54 lakh, validating NHAI’s use of digital evidence to safeguard public funds.
**Key Points / Main Content**
**Project Specifications and Timeline**
* The project involved widening a 15 km section of NH-48 (Kamrej–Chalthan) from four to six lanes, including remedial measures for four "black spots."
* The contract was awarded to M/s SCIW–Unique Construction (JV) in June 2016 under the Engineering, Procurement, and Construction (EPC) mode at a bid cost of Rs. 241.41 crores.
* Work commenced on 21st March 2017, with NHAI providing 87.75% land availability at the start.
**Performance Issues and Foreclosure**
* The contractor demonstrated slow progress and failed to execute major structures and flyovers, focusing only on simple road and drainage work.
* The contract was mutually foreclosed on 11th May 2020 at a physical progress of 49.79% due to continued performance deficiencies.
* A Foreclosure Agreement was signed where both parties agreed that all claims were settled and the contractor would not raise future claims.
**Arbitration Proceedings and Evidence**
* The contractor violated the foreclosure terms in 2022 by initiating arbitration for Rs. 174.49 crore.
* NHAI defended the claim using digital project records, technical documentation, and drone videography.
* The evidence proved that sufficient land was available for work and that the contractor had neglected the most challenging components of the project.
* The Arbitral Tribunal virtually rejected all contractor claims, awarding a minimal sum of Rs. 54 lakhs.
**Impact Analysis**
**NHAI (National Highways Authority of India)**
**Impact**
NHAI successfully protected substantial public funds and reinforced the effectiveness of technology-driven project monitoring. The win establishes a precedent for using digital evidence to hold contractors accountable for non-performance.
**Action Required**
NHAI must continue to maintain robust documentation and utilize digital tools like drone videography and digital project records to manage future contract disputes and ensure evidence-based management.
**M/s SCIW–Unique Construction (JV) / Contractors**
**Impact**
The contractor's claims were largely dismissed due to proven performance deficiencies and the breach of a prior foreclosure agreement. The ruling emphasizes that slow progress and failure to execute key project components (like major structures) will not be financially rewarded through arbitration.
**Action Required**
Contractors must adhere to contract provisions, meet physical progress milestones for complex structures, and honor the "full and final settlement" clauses in foreclosure agreements to avoid unsuccessful and costly litigation.
Key Entities Referenced
National Highways Authority of India (NHAI): The primary authority that successfully defended a Rs. 174.49 crore arbitration claim related to the NH-48 widening project using digital evidence.
Arbitral Tribunal: The legal body that adjudicated the dispute, eventually awarding only Rs. 54 lakhs to the contractor after rejecting the majority of their claims.
NH-48 (Kamrej–Chalthan section, Gujarat): The specific 15 km long national highway project location where the disputed six-laning and construction work was scheduled to take place.
M/s SCIW–Unique Construction (JV): The contractor for the project whose claims were dismissed due to performance deficiencies and failure to adhere to the terms of the Foreclosure Agreement.
Foreclosure Agreement: The 2020 legal document between NHAI and the contractor that settled all claims and expressly barred the contractor from initiating future arbitration.
Ministry of Road Transport & Highways
NHAI Successfully Defends Arbitration Claim,
Safeguards Public Funds in a National Highway
Project
Posted On: 08 MAY 2026 5:53PM by PIB Delhi
Securing a significant arbitration win, NHAI successfully defended an arbitration matter related to the six-
laning of the Kamrej–Chalthan section of NH-48 in Gujarat, leading to substantial savings of public funds.
Against claims of around Rs. 174.49 crore raised by the contractor, the Arbitral Tribunal awarded only Rs.
54 lakh to settle the case, underscoring the importance of digital project monitoring, robust documentation
and evidence-based contract management by NHAI.
The matter pertained to the National Highway project for widening of 15 km long Kamrej–Chalthan
Section of NH-48 from four lane to six lane, that included implementation of long-term remedial measures
for four black spots on Kamrej–Bharuch Section. The project was awarded to the contractor M/s SCIW–
Unique Construction (JV) for development in Engineering, Procurement, and Construction (EPC) mode in
June 2016 at a bid cost of Rs. 241.41 crores. The appointed date for commencement of work was declared
on 21st March 2017 with 87.75% land availability.
During execution, the contractor repeatedly cited land-related constraints, demonstrated slow progress and
failed to execute the work in accordance with the contract provisions. Only simple work related to road
and drainage were carried out, development of major structures and flyovers were not taken up for
development. Owing to continued deficiencies in performance, the contract was mutually foreclosed on
11th May 2020 at a physical progress of around 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. However, in 2022, the contractor
initiated arbitration proceedings claiming around Rs. 174.49 crore against NHAI which was contrary to
the terms of the Foreclosure Agreement.
During the arbitration proceedings, NHAI presented detailed documentary and digital evidence before the
Arbitral Tribunal. This included drone videography, digital project records, and technical documentation
demonstrating that sufficient land was available for execution of the six-laning works and that substantial
drainage work along the edge of the Right of Way has already been completed.
The evidence further established that the contractor had not undertaken key and challenging components
of the project, including major structures and flyovers, which significantly contributed to the foreclosure
of the contract.
Based on the submissions and evidence presented the Arbitral Tribunal, in its award dated 10th March
2026, virtually rejected all claims made by the contractor. Against claims amounting to approximately Rs.
174.49 crore, the Tribunal awarded only Rs. 54 lakhs in favour of the claimant.The case highlights the critical role of digitization and technology-driven project monitoring in
infrastructure development and dispute resolution. The outcome also underlines NHAI’s steadfast
commitment to fix contractor accountability, prudent contract management and protection of public funds
in the implementation of National Highway infrastructure projects across the country.
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GDH/ DS
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