[CLINICAL COURSE- I MOOT COURT ASSESSMENT, 2025]

TEAM CODE: TC3471A

CLINICAL COURSE- I MOOT COURT ASSESSMENT, 2025

Before

THE HON’BLE DISTRICT COURT OF BOTSWANIA

Arising out of

SECTION 9 OF THE CODE OF CIVIL PROCEDURE, 1908

Under

CIVIL SUIT NO. _/2024

IN THE MATTER OF

MARC CONSTRUCTION LIMITED…………......................................……PLAINTIFF

REPUBLIC OF ALBANION...........................……………………………..DEFENDANT

MEMORANDUM ON BEHALF OF THE PLAINTIFF

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TABLE OF CONTENTS
TABLE OF CONTENTS 2

TABLE OF ABBREVIATIONS 1

INDEX OF AUTHORITIES 2

STATEMENT OF JURISDICTION 7

STATEMENT OF FACTS 8

ISSUES RAISED 11

SUMMARY OF ARGUMENTS 12

ARGUMENTS ADVANCED 14

ISSUE A: WHETHER THE GOVERNMENT OF ALBANION FULFILLED ITS

CONTRACTUAL OBLIGATIONS BY GRANTING AN EXTENSION OF TIME? 14

1. The Failure To Timely Transfer The Right Of Way Constitutes A Material Breach
Of Contract. 14

2. The Failure To Fulfill Reciprocal Promises Shall Result In The Repudiation Of The
Contract. 16

ISSUE B: WHETHER MCL IS ENTITLED TO COMPENSATION FOR ADDITIONAL

COSTS INCURRED DUE TO PROJECT DELAYS? 17

1. Extension of Time Does Not Nullify the Right to Compensation in Cases of

Concurrent Delay. 18

2. Delay In Handover Of The Construction Site Entitles The Contractor To

Compensation. 20

3. The Contractor Has Right to Compensation Despite a “No Damages for Delay”
Clause. 23

4. Exclusionary Clauses are invalid in case of Unequal Bargaining Power. 24

4.1 Doctrine of Blue Pencil. 25

5. A Party Is Not Liable For External Interferences Beyond Its Control Unless
Expressly Stated In The Contract. 26

ISSUE C: WHETHER MCL WAS RESPONSIBLE FOR SECURING THE PROJECT

SITE FROM TRIBAL ENCROACHMENT? 26
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1. The Government Was Responsible To Maintain An Encumbrance Free Site 26

2. The Removal Of Site Encroachment Does Not Come Under The Ambit Of MCL’s
Responsibilities 29

ISSUE IV: WHETHER THE CLAUSE GRANTING THE EXTENSION OF TIME

WITHOUT COMPENSATION IS UNENFORCEABLE? 31

1. It Violates Sections 73 and 74 Of The ICA, 1872 31

2. The Clause Goes Against Public Policy 32

PRAYER 35
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TABLE OF ABBREVIATIONS
ABBREVIATION DESCRIPTION

& And

§ Section

¶ Paragraph

AAEC Appreciable Adverse Effect on Competition

AIR All India Reporter

Anr. Another

Assoc. Association

CPC Code of Civil Procedure

MCL Marc Construction Limited

Ed. Edition

Hon’ble Honourable

Ltd. Limited

Ors. Others

Pvt. Private

SC Supreme Court of India

SCC Supreme Court Cases

SCJ Supreme Court Journal

v. Versus

Ed. Edition

[TABLE OF ABBREVIATIONS] Page | 1

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INDEX OF AUTHORITIES

Cases

A.T. Brij Paul Singh v State of Gujarat (1984) 4 SCC............................................................18

A.T. Brij Paul Singh v State of GujaratAIR 1984 SC 1703; K.P. Roy v State of Bihar AIR
1980 SC 2215.......................................................................................................................20
Alopi Parshad & Sons Ltd. v Union of India AIR 1960 SC 588.............................................29
Assistant General Manager v Radhey Shyam Pandey(2020) INSC 238.................................33
Beed District Central Coop Bank Ltd v State of Maharashtra (2006) 8 SCC 514..................24
Bharat Coking Coal Ltd. v L.K. Ahuja(2004) 5 SCC 109........................................................18
Bhopal Sanchi Highways Private Limited v National Highways Authority of India(2023) 223
SCC 482...............................................................................................................................16
Central Inland Water Transport Corporation v Brojo Nath Ganguly AIR 1986 SC 1571.....23
Costain Limited v Charles Haswell & Partners Limited(2009) EWHC 3140 (TCC).............18
DDA v M/s Sportine Payce Infrastructure Pvt Ltd (2024) 1 SCC 123....................................21
Delhi Transport Corporation vD.T.C Mazdoor Congress(1990) INSC 265...........................33
Eureka Forbes Limited v Allahabad Bank and Ors.(2010) 6 SCC 193...................................18
Fateh Chand v Balkishan Das(1964) 1 SCR 515....................................................................17
G.M. Northern Rly. v Sarvesh Chopra 2002 (4) SCC 45 (India).............................................16
G.M. Northern Rly. v Sarvesh Chopra(2002) 4 SCC 45..........................................................18
HUDA v Kedar Nath(2015) 1 SCC 186...................................................................................14
Indo Nabin Projects Ltd. v Powergrid Corporation of India Ltd.(2018) SCC OnLine Del
8405......................................................................................................................................18
Indore Development Authority v Manoharlal, 2020 SCC Online SC 316;Assam State
Electricity Board & Ors. v Buildworth Private Limited......................................................14
K. Marappan v Superintending Engineer, T.B.P.H.L.C Circle, Anantapur and Another 2008
ALD 4 148............................................................................................................................31
K.N. Sathyapalan v State of Kerala (2007) 13 SCC 43...........................................................23
KSS KSSIIPL Consortium v GAIL(India) Ltd.(2015) 4 SCC 210............................................13
M/s A.K. Ghosh and Sons v The State of West Bengal (2023) 1 SCC 456; Mitra Guha
Builders (India) Co v ONGC (2019) SC..............................................................................21
Moulin Bux v Union of India(1970) AIR 1955 SC 1955.........................................................22

[INDEX OF AUTHORITIES] Page | 2

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N.D.R. Israni v Delhi Development Authority(1989) 2 Arb LR 349 (Del)..............................19

Nabha Power Limited v Punjab State Power Corporation Limited2017 INSC 1008.............27
Nabha Power Ltd v Punjab State Power Corporation Ltd (2018) 11 SCC 508......................24
National Highway Authority Of India v Bel-Tbl (Joint Venture)2017 SCC Online DEL 8644.
..............................................................................................................................................29
National Highways & Infrastructure Development Corporation Ltd v T.K. Engineering
Consortium Pvt Ltd (2019) GAUAS 15454 (DB).................................................................27
National Highways Authority of India v D.S. Toll Road (P) Ltd., (2024) SCC OnLine Del 316
(India)...................................................................................................................................14
National Highways Authority of India v HCC Ltd. (2014) DHC 3147....................................31
National Highways Authority of India v HCC Ltd. (2014) DHC 3147; Karan Madaan And
Others v Nageshwar Pandey (2014) DHC 1661..................................................................19
NHAI v IJM Gayatri Joint Venture 2020 (3) Arb LR 463 (Del)..............................................18
P. Radhakrishna Murthy v NBCC Ltd. (2013) 3 SCC 747; MBL Infrastructures Limited v
Delhi Metro Rail Corporation (2023) DHC 9067(India)....................................................18
P.K. Ramaiah & Co. v Chairman & Managing Director, NTPC (1994) 3 SCC 126..............29
P.M. Paul v Union of India, (1989) Supp (1) SCC 368...........................................................25
Pacific Gas & Electric Co v G.W. Thomas Drayage & Rigging 1968Cal SC.........................33
Ramnath International Construction (P) Ltd. v Union of India(2006) INSC 987...................31
Rawla Construction Co. v Union of India (1982) RLR 20......................................................31
Rawla Construction Co. v Union of India ILR (1982) DEL 44...............................................19
S.v Samudram vThe State of Karnataka (2024).......................................................................14
Simplex Concrete Piles (India) Ltd v Union of India (2010) SCC OnLine Del 821...............24
Society for Preservation of Kasauli and its Environs v State of Himachal Pradesh ILR (1995)
1 HP 499...............................................................................................................................27
State of Kerala v M.K. Jose(2015) 9 SCC 433........................................................................16
State of M.P. vRuchi Printers (2016) 12 SCC 628..................................................................14
Texco Marketing (P) Ltd v TATA AIG General Insurance Co Ltd (2022) SCC OnLine SC
1546......................................................................................................................................24
The Union of India v Kishorilal Gupta and BrosAIR 1959 SC 1362......................................18
Unitech Limited and Others v Telangana State Industrial Infrastructure Corporation (Tsiic)
And Others2021 INSC 96....................................................................................................26
United India Insurance Company Limited v Manubhai Dharmasinhbhai Gajera 2008 INSC
730........................................................................................................................................26
[INDEX OF AUTHORITIES] Page | 3
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Foreign cases

Adyard Abu Dhabi v SD Marine Services(2011) EWHC 848 (Comm)...................................17

C.V. George and Company vM/s. Marshall Sons (Manufacturing) Ltd. (1983) MLJR 525.. .16
Carrothers Construction v City of South Hutchinson (2009) 288 Kan. 743............................28
Hadley v Baxendale (1854) 9 Exch 341...................................................................................20
Henry Boot Construction (UK) v Malmaison Hotel (Manchester)(1999) 70 Con. L.R.32A...17
Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26.....................16
Hounslow Borough Council v Twickenham Garden Developments Ltd. (1970) 3 WLR 538. 21
Mackentosh v Midland Counties Railway Co. (1845) 14 M&W 548......................................27
Mackentosh vMidland Counties Rly. Co.(1845)14 M&W 548................................................16
Polyperal Limited v Eon Energy Solutions Limited (2014) EWHC 3045 (QB)......................29
Royal Brompton Hospital NHS Trust vFrederick A Hammond(2000) EWHC 2037...............17
The Royal Brompton Hospital NHS Trust v Hammond(2001) 76 Con. L.R. 148....................17
Williams v Fitzmaurice (1858) 157 ER 709.............................................................................26

Statutes

The Indian Contract Act, 1872 (9 of 1782), s 23.....................................................................32

The Indian Contract Act, 1872 (9 of 1872), s 28(b).................................................................32
The Indian Contract Act, 1872 (9 of 1872), s 37.....................................................................13
The Indian Contract Act, 1872 (9 of 1872), s 55.....................................................................13
The Indian Contract Act, 1872 (9 of 1872), s 73.....................................................................30
The Indian Contract Act, 1872 (9 of 1872), s 74.....................................................................31
The Indian Contract Act, 1872(9 of 1872),s 23.......................................................................24
The Indian Contract Act, 1872, (9 of 1872), s73.....................................................................20
The Indian Contract Act, 1872, (9 of 1872)s 55......................................................................20
The Indian Contract Act, 1872, s 53........................................................................................29
The Indian Contract Act, 1872, s 54........................................................................................18

Treatises

UNIDROIT Principles of International Commercial Contracts, art 7.4.2...............................20

Books/Commentries

Avtar Singh, Law of Contract (4th edn, Eastern Book Company 1982).................................26
FIDIC Silver Book, cl 8.1; UNIDROIT Principles, art 7.1.1...................................................20

[INDEX OF AUTHORITIES] Page | 4

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Keating, Keating on Construction Contracts (12th edn, Sweet & Maxwell 2024).................26
Society of Construction Law, Delay and Disruption Protocol (2nd edn, 2017).....................17

Moot Proposition and clarification

Moot Prop para. ¶ 12................................................................................................................25

Moot prop para. 12...................................................................................................................23
Moot Prop para. 6.....................................................................................................................21
Moot Prop para. 8.....................................................................................................................19
Moot Prop para. 9.....................................................................................................................18
Moot Prop, para 6.....................................................................................................................18
Moot Prop. Para. 12.................................................................................................................22
Moot Prop. Para. 6...................................................................................................................23
Moot Proposition, para 12........................................................................................................28
Moot Proposition, para 14.b.....................................................................................................28

Online sources

Andrew Phang Boon Leong, ‘Vitiating Factors In Contract Law’ (2005) 17 SACLJ 148......24
Anmol Jain, ‘Exclusion Clauses under the Indian Contract Law: A Need to Account for
Unreasonableness’ (2020) 13 NUJS L Rev 4......................................................................32
Arunima Rathore, ‘Delay in the handing over of the Right of Way is a material breach of
contract if it affects the issuance of the Completion Certificate’ (SCC Online, 20 November
2024) <https://www.scconline.com/blog/post/2023/09/29/delhi-high-court-delay-handing-
right-of-way-contract-breach certificate-completion-legal-news/> accessed 19th March
2025......................................................................................................................................14
Ayush Bajpai, ‘Interpretation of Exclusionary Clauses Vis-A-Vis Rule of Damages’
(LiveLaw, 14 November 2024) <https://www.livelaw.in/lawschool/articles/interpretation-
of-exclusionary-clauses-vis-a-vis-rule-of-damages-249585?
fromIpLogin=70621.50808105459>accessed 20 March 2025............................................19
B R Sarma, ‘Adjudication of Claim for Damages under Sections 73, 74 and 75 of Indian
Contract Act, 1872’ (Manupatra Blog, 16 November 2024)
<https://docs.manupatra.in/newsline/articles/Upload/30C28D5D-262B-4A4A-AE17-
C4D86F92BCE0.pdf.> accessed 20th March 2025..............................................................22
Carl S Beattie, ‘Apportioning the Risk of Delay in Construction Projects’ (2004) 46 Wm &
Mary L Rev .........................................................................................................................22

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Jeremy Glover, ‘Liability for Defects in Construction Contracts - who pays and how much?’
(Fenwick Elliott,
14August2022)<https://www.fenwickelliott.com/sites/default/files/Liability%20for
%20Defects%20in%20Construction%20Contracts.pdf. accessed 20th March 2025..........21
Kenneth M Cushman and Bruce W Ficken, Delays and Disruptions in Construction
Litigation (2nd edn, West Group 1993) 639, 739–41..........................................................22
Ministry of Road Transport and Highways, ‘Revised Standard EPC Agreement for NH and
Centrally Sponsored Road Works Proposed’ (6 November 2024)
<https://morth.nic.in/sites/default/files/Revised_standard_EPC_Agreement_for_NH_and_
Centrally_sponsored_road_works_proposed_to_be_implemented_on_EPC.pdf.> accessed
20th March 2025....................................................................................................................21
Multilateral Development Bank, ‘Conditions of Contract for Construction’ (Asian
Development Bank, 14 November 2024)
<https://www.adb.org/sites/default/files/page/84077/fidic-gcc-construction.pdf.> accessed
20th March 2025....................................................................................................................20
PC Markanda, Naresh Markanda and Rajesh Markanda, ‘Compensation for Delay in Works
Contracts’ (Markanda Law, 2 November 2024) <https://www.markandalaw.com/wp-
content/themes/twentysixteen/pdf/COMPENSATION-FOR-DELAY-IN-WORKS-
CONTRACTS.pdf> accessed 19 March 2025.....................................................................18
Prashant Pakhiddey and Lakshmi Dwivedi, ‘Levy of Liquidated Damages by one party to a
contract: When arbitrable?’ (SCC Blog, 15 November 2024)
<https://www.scconline.com/blog/post/2020/10/10/levy-of-liquidated-damages-by-one-
party-to-a-contract-when-arbitrable-comments-in-light-of-sc-judgment-of-mitra-guha-v-
ongc/> accessed 20th March 2025........................................................................................20
Sadiqua Fatma and Tenzen Tashi Negi, ‘Concurrent Delays In Infrastructure Projects & The
Indian Contract Act, 1872’ (Mondaq, 6 June 2024)
<https://www.mondaq.com/india/contracts-and-commercial-law/1475408/concurrent-
delays-in-infrastructure-projects-the-indian-contract-act-1872#authors> accessed 20 March
2025......................................................................................................................................18
Sherif Awad Mohamed Elsherbiny, Samir Abdel-Fattah Gad and Ahmed Mohamed Abdel
Alim, ‘Critical Delay Factors in Construction Projects’ (2024) 72 Int J Eng Trends Tech 1.
..............................................................................................................................................23
Swain W, ‘Contracts “Not for the Public Good” and the Classical Law of Contract’ (2022)
43(1) J Legal Hist 1..............................................................................................................32
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Wayne Courtney, ‘Indemnities and the Indian Contract Act 1872’ (2015) 27 Natl L Sch India
Rev.......................................................................................................................................25

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STATEMENT OF JURISDICTION
It is humbly submitted that the Plaintiff has invoked the jurisdiction of the Hon’ble District
Court of Botswaniain pursuance of Sec. 9 of the Code of Civil Procedure of Albanion which
reads as under:

9. Courts to try all civil suits unless barred.—

The Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits
of a civil nature excepting suits of which their cognizance is either expressly or impliedly
barred.

[Explanation I].—A suit in which the right to property or to an office is contested is a suit of
a civil nature, notwithstanding that such right may depend entirely on the decision of
questions as to religious rites or ceremonies.

[Explanation II].—For the purposes of this section, it is immaterial whether or not any fees
are attached to the office referred to in Explanation I or whether or not such office is
attached to a particular place.]

[STATEMENT OF JURISDICTION] Page | 8

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STATEMENT OF FACTS

BACKGROUND

● The Republic of Albanion, the fifth-largest country by land area in Somalica, is

among the world's leading economies. The government proposed an infrastructure
project aimed at enhancing connectivity between the mineral-rich Marteenek district
and major industrial hubs and ports through the construction of a 230-kilometer-long
double-track railway line. As part of this initiative, bids were invited from both
international and domestic construction firms.

● Marc Construction Limited ("MCL"), an engineering and construction firm

headquartered in the Botswania district of Albanion, specializes in infrastructure
projects, including highways, railways, and large-scale structures. MCL participated
in the bidding process and emerged as the lowest bidder (L-1), securing the contract
through a Letter of Award issued on December 15, 2017.

● Subsequently, on January 1, 2018, an Engineering, Procurement, and Construction

("EPC") contract was formally executed between MCL and the Republic of Albanion.
The contract stipulated a completion deadline of December 31, 2021, covering a
three-year implementation period. Under its terms, MCL was responsible for
mobilizing personnel, procuring equipment, and sourcing raw materials essential for
the project's execution. In turn, the Government of Albanion was required to transfer
70% of the total land needed for the project within 30 days of signing the contract.

COURSE OF EVENTS

● Marc Construction Limited (MCL) duly fulfilled all its contractual obligations.
However, the Government of Albanion failed to meet its commitments regarding the
timely provision of the requisite land. Instead of transferring the agreed 70% of the
total land within 30 days of contract execution, the government provided only 40%
within the stipulated timeframe.

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● This delay significantly impacted the project's progress, causing an extension in the
construction timeline and hindering MCL’s ability to fulfill its contractual duties
within the originally agreed period.

● In response to these setbacks and their adverse effect on the project's completion,
MCL formally requested a four-month Extension of Time (EOT) from the
Government of Albanion, citing the government's failure to uphold its contractual
obligations.

● As a result, the project's completion deadline was extended from December 31, 2021,
to April 30, 2022. However, as per the contractual terms, the EOT was granted on the
condition that MCL would not be entitled to claim any additional costs or damages
arising from the delay.

● Due to delays in the land handover and the resulting project extension, Marc
Construction Limited (MCL) notified the Government of Albanion of the additional
costs incurred. Accordingly, MCL sought compensation for on-site overhead charges,
head office overheads, and loss of profit.

● In response, the Government of Albanion denied liability, arguing that MCL was
responsible for securing the land and preventing external interference, particularly
tribal encroachments. MCL, however, maintained that the primary cause of delay was
the government's failure to provide the land on time and that tribal encroachments
were beyond its control and should have been addressed by the government.

● MCL formally requested compensation on July 2, August 2, and September 2, 2021,

but the government rejected its claim via a letter dated September 10, 2021.
Aggrieved by this decision, MCL filed a suit against the Republic of Albanion on
September 1, 2024, before the District Court of Botswania under Section 9 of the
Code of Civil Procedure of Albanion.

TABLE OF DATES:

DATE EVENT

June 1, 2017 The Government of Albanion invites bids for a 230 km railway

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project connecting the Marteenek district to industrial hubs and ports.

December 15, 2017 MCL is awarded the project as the L-1 bidder after meeting technical
and financial qualifications, and a Letter of Award (LOA) is issued.

January 1, 2018 The Engineering, Procurement, and Construction (EPC) contract is

signed between MCL and the Government of Albanion, stipulating:

● MCL must deploy manpower, machinery, and raw materials.

● The Government must provide 70% of the land within 30

days.

● The project is to be completed within three years (by

December 31, 2021).

February 1, 2018 The Government of Albanion fails to hand over the required 70%
land, providing only 40% instead. This delay hinders MCL’s ability
to execute the project as scheduled.

Mid-2018 to Late Due to the delayed land handover, construction is affected, leading to
2020 a slowdown in work.

Early 2021 MCL realizes it cannot complete the project within the contractual
deadline (December 31, 2021) and formally requests an Extension of
Time (EOT) from the Government of Albanion.

April 30, 2022 Despite the EOT granted, MCL fails to complete the project within
the extended deadline.

May-August 2022 MCL argues that the delay was compounded due to:

● The late land handover, which disrupted the sequence of

construction activities.

● Additional costs incurred for maintaining manpower,

machinery, and operations over an extended period.

September 1, 2024 MCL files a suit against the Government of Albanion in the District

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Court of Botswania, arguing that:

● The Government failed its contractual obligation by delaying

the land handover.

● The EOT clause denying compensation is unenforceable.

● MCL was not responsible for securing the site from tribal
encroachments.

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ISSUES RAISED

ISSUE A: WHETHER THE GOVERNMENT OF ALBANION FULFILLED ITS

CONTRACTUAL OBLIGATIONS BY GRANTING AN EXTENSION OF TIME?

ISSUE B: WHETHER MCL IS ENTITLED TO COMPENSATION FOR ADDITIONAL

COSTS INCURRED DUE TO PROJECT DELAYS?

ISSUE C: WHETHER MCL WAS RESPONSIBLE FOR SECURING THE PROJECT

SITE FROM TRIBAL ENCROACHMENT?

ISSUE D: WHETHER THE CLAUSE GRANTING EXTENSION OF TIME WITHOUT

COMPENSATION IS UNENFORCEABLE?

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SUMMARY OF ARGUMENTS

ISSUE A: WHETHER THE GOVERNMENT OF ALBANION FULFILLED ITS

CONTRACTUAL OBLIGATIONS BY GRANTING AN EXTENSION OF TIME?

The Government of Albanion failed to fulfill its contractual obligations by not providing 70%
of the land within 30 days, constituting a material breach under Section 37 of the Indian
Contract Act, 1872. Courts have ruled that delays in handing over project sites entitle
contractors to damage. Time was of the essence, making the breach more severe under
Section 55. Furthermore, failure to fulfill reciprocal promises justifies contract repudiation, as
established in G.M. Northern Rly. v Sarvesh Chopra and State of Kerala v M.K. Jose. MCL is
entitled to compensation for the delay and damages arising from the breach.

ISSUE B: WHETHER MCL IS ENTITLED TO COMPENSATION FOR

ADDITIONAL COSTS INCURRED DUE TO PROJECT DELAYS?

MCL is entitled to compensation for additional costs incurred due to project delays caused by
the Government of Albanion’s failure to provide 70% of the land on time. The EOT clause
does not nullify MCL’s right to compensation, as delay damages remain recoverable under
Section 73 of the ICA, 1872. Courts have consistently ruled that contractors must be
compensated for employer-caused delays. The exclusionary clause denying compensation is
invalid, as contracts with unequal bargaining power cannot restrict statutory rights. The
Doctrine of Blue Pencil further allows severing unfair provisions. Thus, MCL is entitled to
recover on-site overheads, head office expenses, and lost profits.

ISSUE C: WHETHER MCL WAS RESPONSIBLE FOR SECURING THE PROJECT

SITE FROM TRIBAL ENCROACHMENT?

MCL is not responsible for securing the project site from tribal encroachments as the
Government of Albanion had an implied duty to provide an encumbrance-free site. The EPC
contract assigned land procurement to the government, not MCL. Courts have held that
extensions do not absolve employer liability. The contract did not impose site security

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obligations on MCL. Thus, the government’s failure to prevent encroachments constitutes

breach of contract, entitling MCL to compensation for resulting delays and financial losses.

ISSUE D: WHETHER THE CLAUSE GRANTING EXTENSION OF TIME

WITHOUT COMPENSATION IS UNENFORCEABLE?

The Extension of Time clause without compensation is unenforceable as it violates Sections

73 and 74 of the Indian Contract Act, 1872 and contravenes public policy. The government’s
failure to hand over land on time caused financial losses to MCL, entitling it to compensation
under Section 73. The clause unfairly absolves the government of liability, shifting the
burden onto MCL, making it oppressive and unconscionable. Public policy prohibits such
one-sided clauses, as seen in Delhi Transport Corporation v D.T.C. Mazdoor Congress.
Therefore, the EOT clause must be declared void and due compensation must be provided to
MCL.

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ARGUMENTS ADVANCED

ISSUE A: WHETHER THE GOVERNMENT OF ALBANION FULFILLED ITS

CONTRACTUAL OBLIGATIONS BY GRANTING AN EXTENSION OF TIME?

[1] It is most respectfully submitted before the Hon’ble Court that the government of
Albanion did not fulfil its contractual obligations by granting an extension of time. The
same has been established via a two-fold argument. Firstly, the failure to timely transfer
the Right of Way constitutes a material breach of contract[1]. Secondly, the failure to
fulfill reciprocal promises shall result in the repudiation of the contract [2].

1. THE FAILURE TO TIMELY TRANSFER THE RIGHT OF WAY CONSTITUTES A

MATERIAL BREACH OF CONTRACT.

[2] It is respectfully submitted before the Hon’ble Court that the Government of Albanion’s
failure to provide the requisite land within the timeframe stipulated in the contract
constitutes a material breach. This delay significantly impeded MCL’s operations,
hindering its ability to efficiently carry out construction activities.
[3] Section 37 of the Indian Contract Act, 1872 (“the Act”) states that the parties to a
contract must perform or offer to perform their respective promises unless such
performance is dispensed with or excused under the provisions of this Act. 1 The binding
nature of contractual obligations has been emphasized under Section 37. It was held that
non-performance of a party’s obligations or conditions precedent amounts to a breach,
making the defaulting party liable for damages.2
[4] Section 55 of the Act stipulates that when a party to a contract promises to do something
at or before a specified time, and fails to do it, the other party may, in case time is of the
essence of the contract, treat the contract as voidable at their option or claim damages for
the loss arising from such delay.3
[5] The Hon’ble Supreme Court has held that failure to meet contractual obligations within
the agreed timeline amounts to a breach. The Court emphasized that the defaulting party’s
delay in performance entitles the aggrieved party to compensation for the loss caused by

1The Indian Contract Act, 1872 (9 of 1872), s 37.

2KSS KSSIIPL Consortium v GAIL(India) Ltd.(2015) 4 SCC 210.
3The Indian Contract Act, 1872 (9 of 1872), s 55.
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such delay.The case underscores that timely performance is an integral part of a valid
contractual relationship.4
[6] The Hon’ble Court has also emphasized that time being of the essence must be
determined based on the explicit terms of the contract. If timelines are breached, the
defaulting party is liable to compensate for resulting losses.5
[7] In NHAI v D.S. Toll Roads Pvt. Ltd.,6 the court established the criteria for determining
whether a delay in handing over possession of the site constitutes a material breach. It
was held that if such a delay affects the issuance of the completion certificate or
postpones the commercial date of operation (COD), it amounts to a material breach of
contract.
[8] In this case, a single-judge bench, presided over by Justice Manoj Kumar Ohri, upheld an
arbitral award wherein the arbitrator found that the National Highways Authority of India
(NHAI) materially breached the contract by failing to provide the Right of Way or work
front to the contractor.7 This failure resulted in delays in both the issuance of the
provisional completion certificate and the commencement of commercial operations.
[9] The Court held that delays in land acquisition by the government can give rise to claims
for compensation, as the government remains liable for failing to fulfill its obligations. It
ruled that such delays constitute a breach of contract, and the government cannot evade
responsibility. 8 In S.v Samudram v The State of Karnataka, the Supreme Court addressed
government delays in handing over project sites, which hindered timely completion. The
Court held that such delays could justify claims for damages and reimbursement of
additional costs incurred by contractors.9
[10] In casu, according to the contract, the government was bound to provide 70% of the total
land to MCL within 30 days of signing the contract, i.e., by January 31, 2018. Generally,
in construction contracts, time is not considered of essence unless expressly stated.
However, the scenario is contrary in this case as there was a clear timeline stipulated for
the completion of the construction of the project, i.e., December 31, 2021.

4HUDA v Kedar Nath(2015) 1 SCC 186.

5State of M.P. vRuchi Printers (2016) 12 SCC 628.
6National Highways Authority of India v D.S. Toll Road (P) Ltd., (2024) SCC OnLine Del 316 (India).
7Arunima Rathore, ‘Delay in the handing over of the Right of Way is a material breach of contract if it affects
the issuance of the Completion Certificate’ (SCC Online, 20 November 2024)
<https://www.scconline.com/blog/post/2023/09/29/delhi-high-court-delay-handing-right-of-way-contract-breach
certificate-completion-legal-news/> accessed 19th March 2025.
8Indore Development Authority v Manoharlal, 2020 SCC Online SC 316;Assam State Electricity Board & Ors.
v Buildworth Private Limited
9S.v Samudram v The State of Karnataka (2024).
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[11] The contract specifically required the government to hand over 70% of the land within a
fixed time, i.e., 30 days. This makes time "of the essence" of the contract
[12] The govt’s failure to hand over 70% of the land within the stipulated 30 days constitutes a
clear breach of its contractual obligations under Section 37 of the Act. The explicit
timelines in the contract establish that time was of the essence, as corroborated by Section
55. Under Section 55, the government's failure to meet the deadline constitutes a breach
of its contractual obligation.10
[13] Furthermore, the government’s non-performance of a condition precedent necessary for
MCL to fulfil its obligations renders the breach undeniable, making the government liable
for violating the terms of the contract. This makes the contract voidable at MCL’s
discretion, and the petitioner is entitled to damages for the delay.

[14] In light of the foregoing, it is evident that the Government of Albanion’s failure to
provide the requisite land within the stipulated timeframe constitutes a material breach of
contract. The explicit contractual terms and judicial precedents establish that time was of
the essence, making the delay legally consequential. As a result, MCL is entitled to
damages for the losses incurred due to the government’s failure to meet its obligations.

[15] Therefore, it is respectfully submitted that the Hon’ble Court hold the government liable
for breach and grant appropriate relief to the petitioner.

2. THE FAILURE TO FULFILL RECIPROCAL PROMISES SHALL RESULT IN THE

REPUDIATION OF THE CONTRACT.

[16] It is respectfully submitted before the Hon’ble Court that the Government of Albanion’s
failure to fulfill its reciprocal promises, as stipulated in the contract, constitutes grounds
for repudiation. The partial handover of only 40% of the total land to MCL indicates a
failure to adhere to the agreed order of performance of reciprocal promises. 11
Consequently, MCL is not obligated to fulfill its contractual commitments.
[17] Section 37, which mandates that parties must perform their respective promises. This
obligation is fundamental to the contract's execution and is supported by the principles of
the Indian Contract Act, 1872.
[18] The principle of Pacta Sunt Servanda (Article 26, Vienna Convention, 1969) mandates
that contracts be honored in good faith. Aligned with this, the Doctrine of Fundamental

10Moot prop
11Ibid.
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Breach, holds that failing a fundamental obligation constitutes a repudiatory breach,

reinforcing the sanctity of contracts and justifying termination and damages.12
[19] Indian courts have consistently held that when an employer, in this case, the Government,
fails to fulfill its reciprocal obligations—which serve as a condition precedent to the
contractor’s performance—the contractor is entitled to treat such non-performance as
repudiation of the contract13.
[20] In G.M. Northern Rly. v Sarvesh Chopra,14 the court held that irrespective of whether
time is of the essence in the contract, failure by the employer to perform a mutual
obligation allows the contractor to rescind the contract, rendering it voidable at their
discretion. The Supreme Court in this case also addressed issues related to delays in
performance and breaches governed by Sections 55 and 56 of the Indian Contract Act,
1872.15
[21] The courts have consistently held that mere difficulty in performance does not absolve a
party from liability, as seen in Bhopal Sanchi Highways Private Limited v National
Highways Authority of India where the court ruled that impracticality does not equate to
impossibility.16
[22] In State of Kerala v M.K. Jose (2015), the Supreme Court of India held that delays in land
acquisition by the government, which prevent a contractor from executing the work,
amount to a breach of contract.17
[23] In the present case, the Government of Albanion failed to meet its contractual obligations
concerning the handover of possession and the provision of the Right of Way to MCL. 18
As per the contract, the Government was required to transfer at least 70% of the total land
necessary for project execution within 30 days of signing the agreement.19
[24] Given the Government of Albanion’s failure to fulfill its reciprocal promises, MCL is
justified in treating such non-performance as a repudiatory breach. The legal principles
and judicial precedents affirm that a fundamental breach entitles the aggrieved party to
rescind the contract and claim damages. The partial handover of land directly hindered
MCL’s ability to perform, making the contract voidable at its discretion.

12Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26.
13Mackentosh vMidland Counties Rly. Co.(1845)14 M&W 548.
14G.M. Northern Rly. v Sarvesh Chopra 2002 (4) SCC 45 (India).
15C.V. George and Company vM/s. Marshall Sons (Manufacturing) Ltd. (1983) MLJR 525.
16Bhopal Sanchi Highways Private Limited v National Highways Authority of India(2023) 223 SCC 482.
17State of Kerala v M.K. Jose(2015) 9 SCC 433.
18Moot prop para.
19Moot prop para.
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[25] In view of the aforementioned legal precedents, MCL is entitled to repudiate the contract
and claim compensation for breach under Section 55 of the Indian Contract Act, 1872.

ISSUE B: WHETHER MCL IS ENTITLED TO COMPENSATION FOR

ADDITIONAL COSTS INCURRED DUE TO PROJECT DELAYS?

[26] The Government of Albanion is liable to compensate MCL for on-site and head office
overhead charges, as well as the loss of profit resulting from the overall delay in project
completion. This delay was primarily caused by the Government’s failure to fulfill its
reciprocal obligations, thereby justifying MCL’s claim. 20 The said contention has been
established via a five-fold argument .first;y secondly

1. EXTENSION OF TIME DOES NOT NULLIFY THE RIGHT TO COMPENSATION IN

CASES OF CONCURRENT DELAY.

[27] Under the Indian Contract Act, 1872, particularly Section 73, a party suffering loss due to
the breach of contract is entitled to receive compensation for such loss. The Supreme
Court emphasized that compensation is to be awarded based on the actual loss suffered,
and the burden of proof lies on the aggrieved party to establish the loss incurred due to
the breach.21
[28] Concurrent delay occurs when multiple delays overlap during a project’s timeline, with at
least one attributable to the employer and another to the contractor. 22 As established in
Adyard Abu Dhabi v SD Marine Services, such delays must be of approximately equal
causative impact.23 This means that even if one delaying event had not occurred, the other
would still have resulted in project delay.24
[29] A concurrent delay may arise if an employer-caused delay coincides with a contractor-
caused delay on either the same activity path or parallel critical activity paths. 25 If both
delays independently impact the completion date, they are considered concurrent. 26

20 Moot prop para 9.

21Fateh Chand v Balkishan Das(1964) 1 SCR 515.
22The Royal Brompton Hospital NHS Trust v Hammond(2001) 76 Con. L.R. 148.
23Adyard Abu Dhabi v SD Marine Services(2011) EWHC 848 (Comm).
24Society of Construction Law, Delay and Disruption Protocol (2nd edn, 2017).
25Royal Brompton Hospital NHS Trust vFrederick A Hammond(2000) EWHC 2037.
26Henry Boot Construction (UK) v Malmaison Hotel (Manchester)(1999) 70 Con. L.R.32A.
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[30] In this case, the Government’s failure to provide 70% of the agreed land led to a
significant delay in the overall project completion. 27 Such delays directly affect a
contractor’s profitability,28 requiring them to bear additional costs, 29 including overhead
charges30 and loss of business opportunities.31 These financial burdens cannot simply be
offset by an extension of time (EOT). 32 The four-month EOT granted by the Government
does not adequately compensate MCL for the additional expenses incurred.33
[31] Section 54 of the Indian Contract Act, 1872, states that in reciprocal contracts, a party
failing to perform its obligation must compensate the other party for any resulting loss. 34
This provision upholds a contractor’s right to compensation in instances of concurrent
delay.35
[32] In cases of partial prevention, which does not amount to contract repudiation, 36 the
affected party retains the right to seek compensation and damages. 37 The Supreme Court
of India, in G.M. Northern Railway v Sarvesh Chopra, held that a failure to fulfill
reciprocal promises within the stipulated timeframe entitles the non-defaulting party to
claim damages for the benefits lost due to overall project delay.38
[33] This principle is reinforced by the Latin maxim nullus commodum capere de sua injuria
propria, meaning no one can benefit from their own wrongdoing. 39 A defaulting party
cannot demand performance from the other party without first compensating for its own
failure, as affirmed in Union of India v Kishorilal Gupta & Bros.40
[34] The Delhi High Court, in Rawla Construction Co. v Union of India, established that when
project delays stem from an employer’s breach, the contractor is entitled to claim
27Moot Prop, para 6.
28Indo Nabin Projects Ltd. v Powergrid Corporation of India Ltd.(2018) SCC OnLine Del 8405.
29A.T. Brij Paul Singh v State of Gujarat (1984) 4 SCC.
30NHAI v IJM Gayatri Joint Venture 2020 (3) Arb LR 463 (Del).
31Bharat Coking Coal Ltd. v L.K. Ahuja (2004) 5 SCC 109.
32Costain Limited v Charles Haswell & Partners Limited (2009) EWHC 3140 (TCC).
33 Moot Prop para. 9.
34 The Indian Contract Act, 1872, s 54.
35P. Radhakrishna Murthy v NBCC Ltd. (2013) 3 SCC 747; MBL Infrastructures Limited v Delhi Metro Rail
Corporation (2023) DHC 9067(India).
36 PC Markanda, Naresh Markanda and Rajesh Markanda, ‘Compensation for Delay in Works Contracts’
(Markanda Law, 2 November 2024)
<https://www.markandalaw.com/wp-content/themes/twentysixteen/pdf/COMPENSATION-FOR-DELAY-IN-
WORKS-CONTRACTS.pdf> accessed 19 March 2025.
37Sadiqua Fatma and Tenzen Tashi Negi, ‘Concurrent Delays In Infrastructure Projects & The Indian Contract
Act, 1872’ (Mondaq, 6 June 2024) <https://www.mondaq.com/india/contracts-and-commercial-law/1475408/
concurrent-delays-in-infrastructure-projects-the-indian-contract-act-1872#authors> accessed 20 March 2025.
38G.M. Northern Rly. v Sarvesh Chopra (2002) 4 SCC 45.
39Eureka Forbes Limited v Allahabad Bank and Ors. (2010) 6 SCC 193.
40The Union of India v Kishorilal Gupta and Bros AIR 1959 SC 1362.
[ARGUMENTS ADVANCED] Page | 21
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damages. An extension of time does not, in itself, negate this right unless explicitly stated
in the contract.41
[35] In M/S National Highways Authority of India v M/S HCC Ltd., the arbitral tribunal
awarded additional overhead costs and compensation for the extended presence of
machinery at the project site due to employer-caused delays, including failure to hand
over unencumbered land and local obstructions. The tribunal accepted the respondent’s
argument that multiple employer-caused delays prevented timely project completion,
leading to substantial financial losses.42
[36] Granting an EOT does not negate the contractor’s right to claim damages for additional
costs incurred due to project prolongation. 43 This is supported by the principle of nemo
judex in causa sua, which dictates that a party cannot be the judge in its own case.44
[37] Contractual provisions that restrict the right to claim damages cannot override statutory
rights under Section 73 of the Indian Contract Act. Preventing such claims would violate
public policy. 45
[38] In the present case, MCL was awarded a contract to construct a railway line with a
stipulated completion date of December 31, 2021. However, the Government of Albanion
failed to transfer the required 70% of land within the agreed timeframe, only providing
40%. This delay directly impacted MCL’s ability to mobilize resources and meet the
contractual timeline.
[39] MCL formally requested an Extension of Time (EOT) due to this delay, which was
granted but with the condition that no additional costs could be claimed. Despite this,
MCL incurred significant costs in retaining personnel and equipment on-site due to the
government's failure to provide the land, which constitutes a breach of the contract by the
government.
[40] The delays were not due to any fault of MCL but were a direct result of the government's
inadequate performance of its contractual obligations.Consequently, MCL remains
entitled to compensation from the Government, despite any contractual provisions to the

41Rawla Construction Co. v Union of India ILR (1982) DEL 44.

42National Highways Authority of India v HCC Ltd. (2014) DHC 3147; Karan Madaan And Others v
Nageshwar Pandey (2014) DHC 1661.
43 Moot Prop para. 8.
44N.D.R. Israni v Delhi Development Authority(1989) 2 Arb LR 349 (Del).
45Ayush Bajpai, ‘Interpretation of Exclusionary Clauses Vis-A-Vis Rule of Damages’ (LiveLaw, 14 November
2024) <https://www.livelaw.in/lawschool/articles/interpretation-of-exclusionary-clauses-vis-a-vis-rule-of-
damages-249585?fromIpLogin=70621.50808105459>accessed 20 March 2025.

[ARGUMENTS ADVANCED] Page | 22

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contrary, as the entity granting the EOT cannot unilaterally determine the contractor’s
entitlement to damages.

2. DELAY IN HANDOVER OF THE CONSTRUCTION SITE ENTITLES THE CONTRACTOR

TO COMPENSATION.

[41] In Under Section 73 of the Indian Contract Act, 46 the affected party is entitled to
compensation for losses from a breach. Hadley v Baxendale (1854)47 and Article 7.4.2 of
the UNIDROIT Principles affirm that damages should cover foreseeable losses. 48 The
Supreme Court has upheld compensation for increased costs due to employer delays.
Thus, MCL is entitled to damages for losses caused by the government's failure to
provide land on time.49
[42] The Doctrine of Fundamental Breach states that failure to perform an essential
contractual obligation constitutes a material breach, entitling the non-breaching party to
damages. This aligns with Clause 8.1 of the FIDIC Silver Book, Article 7.1.1 of the
UNIDROIT Principles,50 and Section 55 of the Indian Contract Act, 1872, all of which
recognize the right to compensation for delayed performance.51
[43] Judicial precedents reinforce this. In Ram Singh v State of U.P., the Supreme Court held
that failure to provide necessary resources is a material breach. Similarly, in ONGC v
Saw Pipes Ltd., the court ruled that damages must compensate the aggrieved party for
losses incurred. Thus, MCL is entitled to compensation for the government's failure to
provide land on time.
[44] In construction contracts, the term "site" refers to the designated location where all
activities related to storage and construction are to take place, and where necessary
equipment and materials must be delivered.52 A crucial issue that often arises is whether
the site has been transferred to the contractor in a timely manner, as stipulated in the
contractual agreement.53

46 The Indian Contract Act, 1872, (9 of 1872), s73.

47Hadley v Baxendale (1854) 9 Exch 341.
48UNIDROIT Principles of International Commercial Contracts, art 7.4.2.
49A.T. Brij Paul Singh v State of GujaratAIR 1984 SC 1703; K.P. Roy v State of Bihar AIR 1980 SC 2215
50FIDIC Silver Book, cl 8.1; UNIDROIT Principles, art 7.1.1.
51 The Indian Contract Act, 1872, (9 of 1872)s 55.
52Multilateral Development Bank, ‘Conditions of Contract for Construction’ (Asian Development Bank, 14
November 2024) <https://www.adb.org/sites/default/files/page/84077/fidic-gcc-construction.pdf.> accessed 20th
March 2025.
53Prashant Pakhiddey and Lakshmi Dwivedi, ‘Levy of Liquidated Damages by one party to a contract: When
arbitrable?’ (SCC Blog, 15 November 2024) <https://www.scconline.com/blog/post/2020/10/10/levy-of-
liquidated-damages-by-one-party-to-a-contract-when-arbitrable-comments-in-light-of-sc-judgment-of-mitra-

[ARGUMENTS ADVANCED] Page | 23

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[45] It is an established principle in construction law that the employer has an inherent duty to
provide the necessary land, enabling the contractor to fulfill their contractual
obligations.54 Most construction agreements either explicitly state this requirement as a
standard clause or recognize it as an implied obligation. In Hounslow London Borough
Council v Twickenham Garden Developments Ltd, the court emphasized that a
construction contract inherently mandates the building owner to grant the contractor
sufficient possession, occupation, or usage rights necessary for project execution.55
[46] The judgment in DDA v M/S Sportina Payce Infrastructure Pvt Ltd (2024) supports the
notion that compensation can be claimed if the delays were attributable to the other
party’s failure.56 The Supreme Court's underlines that when delays are caused by one
party, the other party is entitled to claim for overheads and loss of profit incurred as a
result.57
[47] As per Clause 8.2 of the Standard EPC Agreement, drafted by the Ministry of Road
Transport & Highways, failure to provide any portion of the site entitles the contractor to
seek compensation This provision underscores the employer’s liability in cases where
delays in site handover hinder project execution.58
[48] In the present case, the Government’s delay in transferring a substantial portion of the
required land to MCL significantly obstructed the contractor’s operations, thereby
impeding their ability to carry out the construction work within the stipulated timeframe. 59
[49] MCL is entitled to compensation as the Government of Albanion’s delay in land
provision constitutes a fundamental breach. The extension of time clause does not bar
MCL’s claim for on-site overheads, financial losses, and extended costs.
[50] These judgments collectively establish a legal precedent that supports the notion that
when government actions (or lack thereof) cause delays in project execution, contractors
like MCL may be entitled to compensation for additional costs incurred.

guha-v-ongc/> accessed 20th March 2025.

54Jeremy Glover, ‘Liability for Defects in Construction Contracts - who pays and how much?’ (Fenwick
Elliott, 14August2022)<https://www.fenwickelliott.com/sites/default/files/Liability%20for%20Defects%20in
%20Construction%20Contracts.pdf. accessed 20th March 2025.
55Hounslow Borough Council v Twickenham Garden Developments Ltd. (1970) 3 WLR 538.
56DDA v M/s Sportine Payce Infrastructure Pvt Ltd (2024) 1 SCC 123.
57M/s A.K. Ghosh and Sons v The State of West Bengal (2023) 1 SCC 456; Mitra Guha Builders (India) Co v
ONGC (2019) SC.
58Ministry of Road Transport and Highways, ‘Revised Standard EPC Agreement for NH and Centrally
Sponsored Road Works Proposed’ (6 November 2024)
<https://morth.nic.in/sites/default/files/Revised_standard_EPC_Agreement_for_NH_and_Centrally_sponsored_
road_works_proposed_to_be_implemented_on_EPC.pdf.> accessed 20th March 2025.
59 Moot Prop para. 6.
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[51] Given these circumstances, MCL is entitled to claim damages for the delay, as the
hindrance directly affected the timely performance of their contractual obligations.

3. THE CONTRACTOR HAS RIGHT TO COMPENSATION DESPITE A “NO DAMAGES

FOR DELAY” CLAUSE.

[52] It is respectfully submitted before the Hon’ble Court that the EPC contract between the
Government of Albanion and MCL includes a provision stipulating that, in the event of
any delay, both parties shall negotiate an extension of time (EOT) without imposing any
additional costs.60 This provision effectively functions as a “No Damages for Delay”
clause.61
[53] Such clauses are commonly incorporated into construction contracts to preclude the
contractor from claiming financial compensation for delays. Typically, these provisions
are drafted in broad terms, using language such as “any cause whatsoever,” making them
a contentious aspect of construction contracts.62
[54] They often conflict with fundamental principles of contract law, particularly the right to
claim compensation under Sections 73 and 74 of the Indian Contract Act, 1872. 63
However, there are specific circumstances where compensation claims remain valid
despite the existence of such a clause.
[55] According to the principles of contract law, specifically under the Indian Contract Act,
1872, a party is obligated to fulfill its contractual duties in accordance with the terms
agreed upon. Failure to do so amounts to a breach of contract. The Supreme Court of
India held that a party's failure to perform its obligations under the contract allows the
aggrieved party to seek damages for losses incurred due to that breach.64
[56] The entitlement to delay damages depends on the nature and impact of the delay. A delay
that disrupts the overall project timeline and affects its timely completion is classified as a

60Moot Prop. Para. 12.

61Carl S Beattie, ‘Apportioning the Risk of Delay in Construction Projects’ (2004) 46 Wm & Mary L Rev .
62Kenneth M Cushman and Bruce W Ficken, Delays and Disruptions in Construction Litigation (2nd edn,
West Group 1993) 639, 739–41.
63B R Sarma, ‘Adjudication of Claim for Damages under Sections 73, 74 and 75 of Indian Contract Act, 1872’
(Manupatra Blog, 16 November 2024) <https://docs.manupatra.in/newsline/articles/Upload/30C28D5D-262B-
4A4A-AE17-C4D86F92BCE0.pdf.> accessed 20th March 2025.
64Moulin Bux v Union of India(1970) AIR 1955 SC 1955.
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critical delay, particularly when it results from an employer-responsible event—such as

the late handover of the construction site or failure to remove site encumbrances. 65
[57] In the present case, the Government’s failure to hand over the remaining 40% of the site
constituted an employer-responsible event, directly causing a critical delay that postponed
the overall completion of the project.66
[58] The Government of Albanion's failure to transfer the required land constitutes a clear
breach of contract. MCL is entitled to seek damages for the losses incurred due to this
breach, as established in the Moulin Bux case and supported by the principles laid out in
the Indian Contract Act. Consequently, MCL has a legitimate right to claim damages, as
the delay was beyond its control and significantly hindered project execution.

4. EXCLUSIONARY CLAUSES ARE INVALID IN CASE OF UNEQUAL BARGAINING

POWER.

[59] It is respectfully submitted before the Hon’ble Court that the exclusionary clause
incorporated in the EPC contract between MCL and the Republic of Albanion is invalid
due to the presence of unequal bargaining power between the parties. 67 By including such
a clause, the Government of Albanion effectively exempts itself from liability for
compensating MCL in the event of delays in the handover of the construction site.68
[60] An exclusionary clause is a contractual provision that limits, restricts, or eliminates one
party’s liability for potential breaches of contract in advance. The Indian Contract Act,
1872, fundamentally upholds the principles of damages and liability, which are
undermined when contractual obligations are restricted or nullified through such clauses.
[61] An extension of time (EOT) in contracts is a common practice, but it must be
accompanied by the right to claim additional costs arising from delays not caused by the
contractor. The Supreme Court clarified that an extension of time does not preclude a
contractor from claiming compensation for losses incurred due to delays caused by the
other party.69

65Sherif Awad Mohamed Elsherbiny, Samir Abdel-Fattah Gad and Ahmed Mohamed Abdel Alim, ‘Critical
Delay Factors in Construction Projects’ (2024) 72 Int J Eng Trends Tech 1.
66 Moot Prop. Para. 6.
67Central Inland Water Transport Corporation v Brojo Nath Ganguly AIR 1986 SC 1571.
68 Moot prop para. 12.
69K.N. Sathyapalan v State of Kerala (2007) 13 SCC 43.
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[62] The Supreme Court in Nabha Power Ltd. v Punjab State Power Corporation Ltd. has
emphasized that exclusionary clauses must not impose “undesirable hardships” on parties
by restricting their right to claim compensation.70
[63] Furthermore, the Apex Court has repeatedly affirmed that contracts involving unequal
bargaining power should avoid the inclusion of exclusionary clauses to protect the
interests of the weaker party. In Simplex Concrete Piles (India) Ltd. v Union of India,71
the Court struck down an exclusionary clause under Section 23 of the Indian Contract
Act, 1872, deeming it void due to its complete exemption of liability.72
[64] EPC contracts are typically adhesion contracts drafted by the Government in a
standardized format, leaving construction companies with minimal scope for negotiation.
In Texco Marketing (P) Ltd. v TATA AIG General Insurance Co. Ltd., the Court noted
that when a dominant party, such as the Government, dictates contractual terms, the
weaker party is left with no choice but to accept them. Consequently, such contracts are
inherently one-sided and unfairly favor the stronger party.73
[65] In the present case, the contractual provision stating that “both parties will negotiate terms
for an extension of time (EOT) without additional costs” 74 places MCL in a position of
unequal bargaining power, effectively depriving it of its right to claim compensation. The
conditional EOT granted to MCL is invalid as it unjustly restricts MCL's right to claim
damages for losses incurred due to the government's breach of contract. Therefore, in
light of the aforementioned arguments, this clause is legally invalid.

4.1 DOCTRINE OF BLUE PENCIL.

[66] It is further submitted that exclusionary clauses are often rendered void through the
application of the Doctrine of Blue Pencil, which relies on the “main purpose rule” and
seeks a harmonious interpretation of contractual terms. 75 Contract drafters and interpreters
must ensure that a specific clause aligns with the contract’s overall objective and other
provisions, as well as the fundamental principles of the Indian Contract Act.76
[67] Under this doctrine, courts have consistently held that provisions conflicting with the
primary purpose of a contract and capable of being severed without affecting the
70Nabha Power Ltd v Punjab State Power Corporation Ltd (2018) 11 SCC 508.
71Simplex Concrete Piles (India) Ltd v Union of India (2010) SCC OnLine Del 821.
72 The Indian Contract Act, 1872(9 of 1872),s 23.
73Texco Marketing (P) Ltd v TATA AIG General Insurance Co Ltd (2022) SCC OnLine SC 1546.
74 Moot prop para. 12.
75Beed District Central Coop Bank Ltd v State of Maharashtra (2006) 8 SCC 514.
76Andrew Phang Boon Leong, ‘Vitiating Factors In Contract Law’ (2005) 17 SACLJ 148.
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contract’s enforceability should be removed. Such repugnant clauses hinder contractual

execution and contradict the contract’s core objectives.
[68] In the present case, the exclusion of MCL’s right to compensation for additional costs and
overhead expenses77 contradicts the fundamental purpose of the Indian Contract Act,
1872, which seeks to provide remedies to aggrieved parties in cases of contractual non-
performance.78 Thus, MCL is entitled to claim compensation.

5. A PARTY IS NOT LIABLE FOR EXTERNAL INTERFERENCES BEYOND ITS CONTROL

UNLESS EXPRESSLY STATED IN THE CONTRACT.

[69] Under the principles of contract law, a party is generally not liable for external
interferences that are beyond its control, unless such responsibility is expressly stated in
the contract. The Supreme Court held that when a party's failure to fulfill its obligations is
due to external factors, it cannot be held liable for damages.79
[70] MCL contends that the delays caused by tribal encroachments were beyond its control
and should have been managed by the Government of Albanion. The contract did not
stipulate that MCL was responsible for securing the land against external interferences.
The government's failure to provide the required land on time directly led to the delays,
and thus, MCL should not be held accountable for external factors that hindered project
progress.
[71] The Government of Albanion bears the responsibility for the delays caused by
external interferences, such as tribal encroachments. MCL should not be penalized for
these delays and is entitled to compensation for the additional costs incurred due to the
government's failure to meet its contractual obligations.

ISSUE C: WHETHER MCL WAS RESPONSIBLE FOR SECURING THE PROJECT

SITE FROM TRIBAL ENCROACHMENT?

[72] It is most respectfully submitted before the Hon’ble district court of Botswania that the
MCL shall not be held responsible for securing the project site from tribal encroachment
because firstly, the government was responsible to maintain an encumbrance free site[1].

77 Moot Prop para. ¶ 12.

78Wayne Courtney, ‘Indemnities and the Indian Contract Act 1872’ (2015) 27 Natl L Sch India Rev.
79P.M. Paul v Union of India, (1989) Supp (1) SCC 368.
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Secondly, the removal of site encroachment does not come under the ambit of the
responsibility of MCL[2].

1. THE GOVERNMENT WAS RESPONSIBLE TO MAINTAIN AN ENCUMBRANCE FREE

SITE

[73] It is submitted that Section 37 states that the parties to a contract must either perform, or
offer to perform, their respective promises, unless such performance is dispensed with or
excused under the provisions of this Act, or of any other law.80
[74] Both parties are required to perform or ensure the performance of their respective
promises as stipulated in the contract. If one party fails in fulfilling its obligations, it
constitutes a breach of contract.81
[75] In Unitech Limited and Others v Telangana State Industrial Infrastructure Corporation
(Tsiic) And Others, the Supreme Court categorically established that the Section imposes
upon the government, the responsibility to ensure that the land handed over for
development is free from encumbrances, as mandated by the Development Agreement. 82
[76] As per the “doctrine of implied terms”, the contract has to be interpreted beyond the
written terms. The doctrine suggests that certain terms, even if not explicitly stated in the
contract, are implied based on the nature of the agreement, the intention of the parties, or
the necessity for the contract’s performance.83
[77] The principle was recognised in Williams v Fitzmaurice,where it was held that even if the
terms do not specify the performance of a certain term, an inference from the language of
the specification can be drawn.84 The same has been recognised in the Indian
jurisprudence in United India Insurance Company Limited v Manubhai Dharmasinhbhai
Gajera where the Supreme Court ruled that an implied term can be included when it
reflects the true intentions of all parties involved in the contract.85
[78] Additionally, encumbrances refer to with regards to construction projects, refer to
mortgages, charges, pledges, liens, hypothecation, security interest, assignment, privilege,

80 The Indian Contract Act, 1872 (9 of 1872), s 37.

81Avtar Singh, Law of Contract (4th edn, Eastern Book Company 1982).
82Unitech Limited and Others v Telangana State Industrial Infrastructure Corporation (Tsiic) And Others2021
INSC 96.
83 Keating, Keating on Construction Contracts (12th edn, Sweet & Maxwell 2024).
84Williams v Fitzmaurice (1858) 157 ER 709.
85United India Insurance Company Limited v Manubhai Dharmasinhbhai Gajera 2008 INSC 730.
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or any other pending obligation that may have to be cleared before the possession of the
site is acquired.86
[79] According to the standard EPC contract, subject to the provisions of clause 8.2 which
expounds the procurement of the site as well as handing down the possession of the site to
the employer, it is the responsibility of the employer or the authority assigning the tender
to ensure that the land is free from all encumbrances and occupations.87
[80] Additionally, the contractor should not be required to make any payment vis-à-vis
compensations, costs or additional charges for the acquisition of the site. Under clause
8.6, the contractor shall bear all the costs and charges in connection to the provision of the
access to the site.
[81] In Nabha Power Limited v Punjab State Power Corporation Limited, the Supreme Court
held that implied terms should be inferred in contracts when necessary to give effect to
the transaction's business efficacy.88 Additionally, in National Highways and
Infrastructure Development Corporation Ltd. and Ors v M/S T. K. Engineering
Consortium Pvt. Ltd., the court laid that the Government must provide an unrestricted
right of way to the contractor.89
[82] Right of Way means the constructive possession of the site free from encroachments and
encumbrances, together with all-wayleaves, easements, unrestricted access, and other
rights of way, howsoever described, necessary for the construction and maintenance of
the Project Highway in accordance with this agreement.90
[83] In the international jurisprudence as well, the principle has been duly established. In
Mackentosh v Midland Counties Railway Co., the Exchequer Chamber held that an
employer, including a government, must provide a construction site free from
encumbrances so that the contractor can perform their obligations.91
[84] Furthermore, in Carrothers Construction v City of South Hutchinson, it was settled that if
a government entity delays providing an unencumbered site, the contractor is entitled to
damages.92

86A.T. Brij Paul Singh v State of Gujarat (1984) 4 SCC.

87ibid.
88Nabha Power Limited v Punjab State Power Corporation Limited2017 INSC 1008.
89National Highways & Infrastructure Development Corporation Ltd v T.K. Engineering Consortium Pvt Ltd
(2019) GAUAS 15454 (DB).
90 Society for Preservation of Kasauli and its Environs v State of Himachal Pradesh ILR (1995) 1 HP 499.
91Mackentosh v Midland Counties Railway Co. (1845) 14 M&W 548.
92Carrothers Construction v City of South Hutchinson (2009) 288 Kan. 743.
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[85] In casu, there was a failure to secure and protect the land from external disturbances,
especially tribal encroachments.93 It was wrongly alleged by the Government that the fault
of such encroachments was due to MCL’s own failure rather than their own unreasonable
delay.94 One of the contractual clauses also provided that the Government would be
responsible for the required manpower and machinery for the construction of the
project.95
[86] It was obligatory upon the government to fulfil the promises made in the contract with
MCL. Even though the contract may not explicitly state that the government must ensure
the land is free from encroachments, the nature of the agreement and the necessity for its
performance imply such an obligation.
[87] The failure of the government to secure the site and prevent tribal encroachments
constitutes a breach of this implied obligation, as the contractor, MCL, could not have
been expected to undertake such responsibilities that were inherently within the domain
of the government.
[88] Additionally, the government, by failing to provide the land in a construction-ready
condition, violated the fundamental requirement for delivering the site free from such
encumbrances as observed in the present case.
[89] The government's failure to ensure that the site is free from encroachments in the present
case directly contradicts the principle laid in National Highways case. Moreover, the
government’s unreasonable delay in providing possession led to circumstances that
obstructed MCL’s ability to carry out construction, shifting liability onto the government
rather than the contractor, MCL.
[90] Applying the internationally recognised principles to the present case, the government’s
failure to secure the site from tribal encroachments resulted in undue obstructions,
constituting a breach of contract.
[91] Therefore, the government should be held responsible for the tribal encroachments.
2. THE REMOVAL OF SITE ENCROACHMENT DOES NOT COME UNDER THE AMBIT
OF MCL’S RESPONSIBILITIES

[92] It is submitted that Section 53 provides that when a contract contains reciprocal promises,
and one party to the contract prevents the other from performing his promise, the contract
becomes voidable at the option of the party so prevented; and he is entitled to

93Moot Proposition, para 12.

94ibid.
95Moot Proposition, para 14.b.
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compensation from the other party for any loss which he may sustain in consequence of
the non-performance of the contract.96
[93] The general EPC contract makes a contractor responsibility for all aspects of the project,
including design, procurement, construction, commissioning, and the final handover to
the end user or owner.97
[94] In K.N. Sathyapalan v State of Kerala, it has been established that the government cannot
shift blame onto the contractor for delays caused by factors beyond the contractor’s
control, especially when the contract assigns responsibility to the government for site
readiness.98
[95] In the same spirit, the court in Alopi Parshad & Sons Ltd. v Union of India held thata
contractor cannot be made to bear unforeseen burdens that were not contemplated in the
contract, particularly when the risk was allocated to the other party.99
[96] Regarding the responsibility of a contractor during such situation, the court has also ruled
that if the government fails to clear the site or remove obstacles, the contractor cannot be
expected to proceed with the work, and the responsibility remains with the government. 100
Any delay in providing an encroachment-free site can amount to a material breach of
contract, entitling the contractor to compensation.101
[97] In National Highway Authority Of India v Bel-Tbl (Joint Venture), the court established
that the employer (government) must ensure possession of the site and clear access before
the contractor can commence work. If there is a delay in handing over the site, the
contractor is entitled to compensation for the loss caused due to reasons attributable to the
employer.102
[98] In casu, the contract between the Government of Albanion and MCL, categorically,
stipulated the contractual obligations of the MCL. The latter was responsible for
deploying manpower, machinery, and supplying raw materials necessary for the
execution of the Project.103 The contract did not vest any additional duties upon MCL
with regards to removal of site encroachments and ensuring the site is free from
encumbrances.

96 The Indian Contract Act, 1872, s 53.

97ibid.
98K.N. Sathyapalan v State of Kerala (2007) 13 SCC 43.
99Alopi Parshad & Sons Ltd. v Union of India AIR 1960 SC 588.
100P.K. Ramaiah & Co. v Chairman & Managing Director, NTPC (1994) 3 SCC 126.
101Polyperal Limited v Eon Energy Solutions Limited (2014) EWHC 3045 (QB).
102National Highway Authority Of India v Bel-Tbl (Joint Venture)2017 SCC Online DEL 8644.
103ibid.
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[99] The contractual clauses did not impose any duty on MCL regarding the removal of
encroachments or ensuring an encumbrance-free site. Consequently, MCL cannot be held
responsible for issues that fall outside its contractual scope.
[100] The encroachments constituted an external and unforeseen obstacle that MCL had no
contractual obligation to resolve. Since the contract expressly assigned the responsibility
of deploying necessary manpower and machinery to the government, it follows that any
failure in fulfilling this obligation cannot be transferred to MCL.
[101] Therefore, the responsibility to preserve and protect the land from tribal encroachments
does not come under the ambit of responsibilities of MCL, and it is the government which
is liable and should pay compensation for the damages caused thereof.

ISSUE IV: WHETHER THE CLAUSE GRANTING THE EXTENSION OF TIME

WITHOUT COMPENSATION IS UNENFORCEABLE?

[102] It is most respectfully submitted before the Hon’ble District of Botswania that the clause
granting the extension of time without compensation is unenforceable because firstly, it
violates Sections 73 and 74 of the ICA, 1872 [1]. Secondly, the clause goes against public
policy[2].

1. IT VIOLATES SECTIONS 73 AND 74 OF THE ICA, 1872

[103] It is submitted that Section 73 of the ICA provides that when a contract is breached, the
party that suffers from the breach is entitled to compensation for any loss or damage
arising naturally from the breach. The damages should be directly linked to the breach
and must not be too remote.104
[104] On a similar line, Section 74 addresses liquidated damages, which means that if a contract
specifies a predetermined sum for breach, the affected party can claim that amount.
However, it does not exclude the right to claim actual losses suffered due to the breach if
the liquidated damages clause is either absent or insufficient to cover the actual losses. 105
[105] In Rawla Construction Co. v Union of India, it was clarified that where the cause of delay
is due to the breach of contract by the employer, and there is also an applicable power to

104The Indian Contract Act, 1872 (9 of 1872), s 73.

105The Indian Contract Act, 1872 (9 of 1872), s 74.
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extend the time, the exercise of that power will not, in the absence of clearest possible
language, deprive the contractor of his right to damages for the breach.106
[106] Similarly, in Ramnath International Construction (P) Ltd. v Union of India, it was held
that an extension does not absolve the employer from liability for delays they
caused.107An extension of time does not prevent a contractor from claiming additional
costs incurred due to delays caused by the employer.108
[107] Furthermore, delays in completion due to the government’s actions cannot constitute
grounds for liability against the contractor. The contractor could not be held responsible
for delays that were not their fault.109
[108] In casu, the contract required the Government of Albanion to hand over 70% of the land
within 30 days of signing. However, the government only provided 40% within the
stipulated time, delaying the project.110 The delay forced MCL to keep its workforce,
machinery, and resources on standby, significantly increasing on-site overheads. MCL
also incurred head office expenses due to the extended project duration. 111 The delay
prevented MCL from taking on other projects, leading to a loss of profits.112
[109] The delay directly impacted MCL’s ability to carry out its contractual obligations,
causing financial harm. Since the damages suffered—such as increased overhead costs
and loss of profit—are a natural consequence of the government’s delay, MCL is entitled
to compensation under Section 73.
[110] The contract in question does not contain a liquidated damages clause that fully
compensates for MCL’s extended costs. Thus, MCL has the legal right to recover its on-
site overheads, head office expenses, and loss of profit, as these financial burdens were a
direct consequence of the employer’s breach.
[111] MCL suffered significant losses due to the delay, which forced it to retain workforce,
machinery, and resources on standby, preventing it from undertaking other profitable
projects. Denying MCL compensation while shifting the burden of delay onto the
contractor is not only inequitable but also legally unsustainable.
[112] Therefore, it results in violation of Sections 73 and 74 of the ICA, 1872.

106Rawla Construction Co. v Union of India (1982) RLR 20.

107Ramnath International Construction (P) Ltd. v Union of India(2006) INSC 987.
108National Highways Authority of India v HCC Ltd. (2014) DHC 3147.
109K. Marappan v Superintending Engineer, T.B.P.H.L.C Circle, Anantapur and Another 2008 ALD 4 148.
110Moot Proposition
111Moot Proposition
112Moot Proposition
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2. THE CLAUSE GOES AGAINST PUBLIC POLICY

[113] It is submitted that Section 23 of the ICA states about what consideration or objects are
considered lawful and what not and voids agreements if their object or consideration is
unlawful, fraudulent, or opposed to public policy.113
[114] The doctrine of public policy necessitates that contractual clauses are within the limits of
conscionability and do not arbitrarily harm the interests of a party to the contract. 114 If the
clause goes against this limit, the same constitutes a violation of public policy.
[115] Section 28(b) states that every agreement which extinguishes the rights of any party
thereto, or discharges any party thereto, from any liability, under or in respect of any
contract on the expiry of a specified period so as to restrict any party from enforcing his
rights is void to the extent.115
[116] Contractual terms that extinguish legal rights or restrict recourse to claim compensation
are void. Agreements cannot restrict a party’s ability to seek remedies for contractual
breaches.116
[117] The Supreme Court in Central Inland Water Transport Corporation v Brojo Nath
Ganguly recognised the same and held that contractual clauses that result from unequal
bargaining power can be struck down if they cause undue hardship. 117A party cannot be
made to bear unforeseen burdens that were not contemplated at the time of contract
formation, especially when the risk allocation was unfairly imposed.118
[118] In Delhi Transport Corporation v D.T.C Mazdoor Congress and Others, it was held that
contracts entered into under unfair circumstances, where one party has significantly more
bargaining power, could be declared void as they are injurious to public interest. 119
Similarly, it has been settled position of law that contracts that are unconscionable, unfair,
and unreasonable are detrimental to public interest and should be adjudged void.120
[119] Internationally, it has been established that a contractual extension of time does not bar
compensation claims when the delay was caused by the employer. 121 It is also recognised
113 The Indian Contract Act, 1872 (9 of 1782), s 23.
114 Swain W, ‘Contracts “Not for the Public Good” and the Classical Law of Contract ’ (2022) 43(1) J Legal
Hist 1.
115 The Indian Contract Act, 1872 (9 of 1872), s 28(b).
116Anmol Jain, ‘Exclusion Clauses under the Indian Contract Law: A Need to Account for Unreasonableness’
(2020) 13 NUJS L Rev 4.
117 Central Inland Water Transport Corporation v Brojo Nath Ganguly AIR 1986 SC 1571.
118 ibid
119Delhi Transport Corporation v D.T.C Mazdoor Congress (1990) INSC 265.
120Assistant General Manager v Radhey Shyam Pandey (2020) INSC 238.
121 ibid
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position that contract terms must be interpreted in light of fundamental fairness and the
intent of the parties.122
[120] In casu, due to the delayed land handover, MCL had to retain manpower, machinery, and
resources on-site beyond the originally planned period, significantly increasing on-site
overheads and head office expenses.123 Recognizing its own delay, the government
granted MCL an Extension of Time (EOT) for four months (until April 30,
2022).124However, this extension was granted on the condition that MCL could not claim
additional costs or damages, a one-sided, non-negotiable clause imposed by the
government.125
[121] The EOT clause, which denied MCL compensation despite government-caused delays,
was inherently unfair and imposed an unreasonable financial burden on MCL. The clause
allowed the government to escape liability while forcing MCL to bear the cost of the
delay, making it contrary to established principles of fairness. The object of their contract
was ultimately in opposition to the public policy.
[122] Applying the principle laid in Brojonath Ganguly case, the Government of Albanion, as
the contract-drafting authority, inserted the EOT clause unilaterally, leaving MCL with no
choice but to accept its terms. The clause was non-negotiable, and the risk allocation was
unfairly imposed on MCL, as it had no reasonable expectation that it would have to bear
costs resulting from government delays.
[123] Given the significant increase in MCL’s on-site and head office expenses due to this
delay, denying compensation under such circumstances is contrary to public policy and
established principles of fairness in contract law. Therefore, the clause violates public
policy.

122 Pacific Gas & Electric Co v G.W. Thomas Drayage & Rigging 1968 Cal SC.
123Moot Proposition
124Moot Proposition
125Moot Proposition
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PRAYER

Wherefore in light of the issues raised, arguments advanced and authorities cited, the Counsel for
the Plaintiffs humbly prays that the Hon’ble Tribunal may be pleased to find and declare that:

1. The companies have not entered into an anti-competitive agreement, violating

Section 3 of the Competition Act.

2. Alpha and Gamma do not have a separate anti-competitive agreement, distinct from
the one between the companies.

3. The proposed information exchange between Alpha and Gamma, as described in the
term sheet, would not violate the Competition Act.

4. Order against the companies as ordered by CCI be quashed.

And/or
any other order that the Tribunal may deem fit in light of justice, equity and good conscience.

~All of which is humbly prayed~

DATE: --/--/2025 S/D-

PLACE: C OUNSELS ON BEHALF OF
PLAINTIFFS

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