The document discusses various types of delays that can occur in construction projects and their classifications. It provides examples of: 1) Excusable delays such as labor disputes, fires, and unavoidable delays that are beyond the contractor's control. 2) Non-excusable delays like ordinary weather, subcontractor delays, and failures by the contractor to properly manage the site. 3) Compensable delays caused by unforeseen issues like transportation delays beyond the contractor's control. It also discusses the differences between critical and non-critical delays as well as concurrent delays caused by multiple parties. The key takeaway is that excusable, non-critical, and concurrent delays may provide grounds for claims for

1. DELAYS
Karthik Madhavan
SCMHRD, Pune.

2. CAUSES FOR DELAY
• Defects in
documents/design/decision.
• Incompetence of parties to cope
up with changes.
• Differing site conditions.
• Attitude of any one or both the
parties.

3. EXCUSABLE DELAYS
• The consideration to excuse would be:
– Non-foreseeable situation.
Non-critical in impact.
Concurrent with party's delay.
• Labour disputes.
• Fire.
• Unusual delay in deliveries.
• Unavoidable delays.

4. NON-EXCUSABLE DELAYS
• Ordinary and foreseeable weather
conditions.
• A subcontractor's delays.
• The contractor's failure to adequately
manage and coordinate the project site.
• The contractor's financing problems.
• The contractor's failure to mobilize quickly
enough.
• Delay by the contractor in obtaining

5. COMPENSABLE DELAYS
• Unforeseen delays in transportation.
• Other causes beyond „the contractor's control‟.
CRITICAL AND NON-
CRITICAL DELAYS
• Time is of the essence.
CONCURRENT DELAYS
• While one party undergoes a phase of delay of its own
making, the other party too is delayed due to its own
deficiencies.
Thus a non-critical, concurrent delay is Excusable and
therefore what gives rise to claim for damages is Critical,

6. GAIL INDIA LTD.
V/S
HINDUSTAN
CONSTRUCTION
COMPANY

7. FACTS
• Contract Awarded On 6th July 1994
• For upgradation of the Auraiya Gas Compressor
Station for HBJ Pipeline.
• To be completed by 27th February 1995.
• Actually completed on 31st October 1996
• Delay of about 20 months.
• GAIL claims that HCC was not serious about the
execution of the job awarded to it
• Various notices/letters were issued to HCC by
GAIL, and also by Engineers India Ltd. (`EIL')
who were the Engineer-in-charge of the project.

8. ISSUES
• HCC had already submitted its NCC while
requesting EoT by a letter dated 7th
March 1997.
• GAIL by its letter dated 14th January 1998
requested HCC to submit a fresh NCC.
This was done by the HCC on 16th
January 1998.
• HCC also issued another letter dated 16th
April 1999, that no further amount is due
to it under the contract in question.

9. ISSUES
• 6th October 1999: HCC filed it claims to arbitrator
• GAIL's objection as to maintainability of HCC's claim was
rejected by the learned Arbitrator in the impugned
Award dated 11th August 2003.
• HCC had imposed a condition for issuance of such NCC.
– “We shall have no claim whatsoever of any kind
towards the Contract and the works executed at GAIL
Dibiyapur subject to sanction of final extension of
time without levy of Liquidated Damages and
payment of our final bill”
• GAIL‟s reply:
– “You had submitted conditional No Claim Certificate
subject to extension of contractual completion period

10. JUDGEMENT
• HCC insisted on GAIL extending the period of
completion of the contract without imposition of
LD as a pre-condition to issuing the NCC.
• GAIL acceded to the said condition and
thereafter HCC issued the NCC.
• The two parties were in negotiation as regards
the settlement of the final bill and there was no
compulsion on HCC, much less any coercion, to
issue an NCC.
• For the aforementioned reasons, the Court sets
aside the impugned Award dated 11th August

11. SUDHIR GENSETS LTD
v/s
INDIAN OIL CORPORATION
LTD

12. FACTS
• Delayed the supply and installation of the
Gen-sets beyond the time limit.
• Work was not completed on time.
• EoT is not to be granted according to the
contract.
• Section 73 and 74 was violated to which
Indian Oil claimed LD.
• Time was extended by letter dated 4-12-
1996 with a specific demand that the
clause for liquidated damages would be

13. FACTS
• Sudhir Gen-sets had supplied the goods
• Indicates that they were agreeable to pay
liquidated damages.
• Sudhir gen-sets raised issue with arbitrator
claiming there was no loss to IOC.
• Arbitrator dismissed the claims.
• No justifiable reason for the Arbitral Tribunal to
arrive at a conclusion that still the purchaser
should prove loss suffered by it because of delay
in supply of goods.
• It was LD and not Penalty.

14. ISSUES
• There is specific stipulation in the agreement
that the time and date of delivery of the goods
was of the essence of the contract;
• In case of failure to deliver the goods within the
period fixed for such delivery in the schedule,
ONGC was entitled to recover from the
contractor liquidated damages as agreed;
• It was also explicitly understood that the agreed
liquidated damages were genuine pre-estimate
of damages;
• On the request of the respondent to extend the

15. ISSUES
• Specifically that time was extended but
stipulated liquidated damages as agreed would
be recovered;
• Liquidated damages for delay in supply of goods
were to be recovered by paying authorities from
the bills for payment of cost of material supplied
by the contractor;
• There is nothing on record to suggest that
stipulation for recovering liquidated damages
was by way of penalty or that the said sum was
in any way unreasonable.

16. JUDGEMENT
• Damages were pre-fixed by the
parties with regard to loss suffered by
IOC on account of delay in supplying
the equipment.
• It is not necessary for the respondent
to prove actual damages.
• Thus, the arbitrator was justified in
dismissing the claim of Sudhir Gen-
sets by virtue of Clause 13 of the

17. MAYURDWAJ COOPERATIVE GROUP
V/S
DELHI DEVELOPMENT AUTHORITY

18. •DELHI DEVELOPMENT AUTHORITY –
Defendants and Housing Society Ltd –
Plaintiff
FACTS
•Suit for recovery of Rs 61,42,790/-
•Plaintiff allotted 5 acres of land by
defendant in 1982
•As per plaintiff, land was sufficient for
construction of only 300 flats, whereas
the membership of the plaintiff-society,

19. • Defendant later offered additional
land to the plaintiff for the remaining
160 members and asked it to deposit
Rs 11,87,119.80/- towards cost of the
additional land.
• The plaintiff made payment of Rs
6,82,689.65/- and asked the
defendant to allot the additional land
to it.
• The defendant did not allot additional
land for the remaining 160 members

20. •The defendant directed the plaintiff
to deposit Rs 39,88,824.38/- for
granting extension of time for
construction of flats.
• The aforesaid amount was
deposited by the plaintiff under
protest
•Despite legal notices for possession
of additional land and refund of Rs
26 39,88,824.38/-, the defendant

21. • The plaintiff thus claimed the
aforesaid amount of Rs
39,88,824.38/- along with interest
@18% p.a. amounting to Rs
21,53,964.62/-, thus making a total
claim of Rs 61,42,790/-
• Defendant objected that the suit is
not maintainable for want of notice
under Section 53-B Delhi
Development Act.

22. •Due to the arbitration clause contained in Perpetual Lease
Deed, the suit is not maintainable and the matter is
required to be referred for arbitration.
•The plaintiff-society represented that it had 460 members
and requested for allotment of land measuring 7.666 acres
and also deposited Rs 8,53,800/- on 03rd March, 1982 but
only 5 acres of land was available in Patparganj.
•It was decided to allot land measuring 7.666 acres,
subject to payment of Rs 11,87,119.80/- towards cost of
additional land, but, the society failed to deposit the cost
of additional land.
• Since the society had paid Rs 25,28,300/- towards
premium 5 acres was allotted to it.
•The plaintiff paid Rs 3,00,000/- on 11th March, 1983, Rs
3,68,250/- on 30th April, 1983 and Rs 11,87,119/- on 21st
June, 1983 and interest, amounting to Rs 6,82,689.68 on

23. ISSUES
•Whether present suit is barred for want of
proper legal notice under Section 53-B of the
Delhi Development Act?
•Whether notice under Section 53-B of the
Delhi Development Act had been served on
the defendant?
•Whether the present suit is barred by time?
•Whether there is an arbitration agreement
between the parties, if so what would be its
effect?
•Whether plaintiff is entitled to claim the

24. JUDGEMENT
•It would make no difference to the merits of the
case as that there was no linkage between
construction on the land measuring 5 acres allotted
to the plaintiff-society at Patparganj and allotment of
additional land to it.
•This is not a suit for damages on account of delay
in allotment of additional land to the plaintiff-society
nor is this a suit for payment of interest on the
amount paid as premium for additional rent on the
ground that there was no delay on the part of the
DDA in allotting additional land to the plaintiff-
society, despite receipt of entire land premium from
it alongwith requisite interest.

25. • Since construction was not dependent
on allotment of additional land and
there was no hindrance such as
encroachment on the land at
Patparganj, non-completion of
construction within the time
stipulated was not justified.
• The lessor, therefore, was very much
entitled to recover composition fee
while acceding to the request of the

26. RAUNAQ INTERNATIONAL LIMITED
V/S
I.V.R. CONSTRUCTION LTD.

27. FACTS
•The Maharashtra State Electricity Board floated a tender
for design, engineering, manufacture, supply, erection
and commissioning of large diameter pipes and steel
tanks with all accessories and auxiliaries of Khaperkheda
Thermal Power Station, Maharashtra, each unit being of
210 MW.
•The qualifying requirements was that the bidder should
have designed
fabricated/manufactured, supplied, erected and
successfully commissioned large diameter piping system
comprising the supply of M.S. pipes not less than 2000
mm diameter and laid/buried for a minimum total length
of 3 kms. in a thermal power station.

28. • 4 tenderers qualified as per the qualifying
criteria. M/s. IVR Construction was one of
them.
• Raunaq International Ltd. had done work
for less than 3 kms but had done CW
piping for 210 MW units.
• M/s. IVR Construction Ltd. fell short of the
requisite experience by one year.
• Raunaq International Ltd.‟s offer was the
most competitive and hence tender
awarded to it.
• IVR Const. challenged this decision in High
Court.

29. JUDGEMENT OF SUPREME
•
COURT under the
Relaxation was permissible
terms of the tender. The relaxation
granted to M/s. Raunaq International Ltd.
is on valid principles looking to the
expertise of the tenderer and his past
experience although it does not exactly
tally with the prescribed criteria.
• IVR Construction Ltd. themselves do not
fulfil the requisite criteria. Thus, any
judicial is not valid in this case.
• Even if criteria can be relaxed both, offer

30. • Also stopping the performance of the
contract so awarded, there is a major
detriment to the public because the
construction of two thermal power
units is held up.
• There is no allegation of collateral
reasons for granting the contract to
Raunaq International Ltd.
• High Court has erred in granting the
interim order. M/s. IVR Construction

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