Ever wondered how big companies settle their arguments? Let's dive into a recent court case between Puri Constructions and Larsen & Toubro that took place in New Delhi.
Back in 1995, Puri Constructions bought land in Gurgaon, Haryana, planning to build a housing project. They partnered with ITC Ltd., but ITC later left the project. The development was then handed over to Larsen & Toubro (L&T) in 1998.
The Development Agreement included a rule that said if they couldn't solve their problems by talking, they'd have to go to arbitration, which is like a private court. By 2000, problems came up, and Puri Constructions asked for arbitration.
In 2001, Justice G. N. Ray was chosen as the arbitrator, and by 2002, a decision was made. However, Larsen & Toubro didn't agree with the decision, leading to a series of legal battles. The Delhi High Court changed parts of the decision in 2008, and more appeals followed.
On April 21, 2025, the Supreme Court said that while Larsen & Toubro did break some rules, how much they should pay needed more arbitration. They allowed Puri Constructions to continue with this.
After the Supreme Court's decision, Puri Constructions sent a new notice in May 2025, asking for arbitration on the claims that weren't settled. Attempts to solve the issue without arbitration didn't work, leading to the current request for a new arbitrator.
Justice Harish Vaidyanathan Shankar handled the case. Even though Puri Constructions wanted to focus only on deciding the amount of money owed, the court decided that all issues could be looked at. Justice Mukul Mudgal was chosen as the arbitrator.
"Court time is valuable and unnecessary arguments should be avoided."
The court stressed the importance of respecting the legal process and appointed an arbitrator to deal with all the unresolved issues. Both companies have to share the costs of arbitration equally.
