Delhi High Court Partially Sets Aside NHAI Arbitration Award for Kalpataru JV Kurukshetra Expressway, Termination Payment Claim Rejected

Delhi High Court Partially Sets Aside NHAI Arbitration Award

The Delhi High Court's order on July 28, 2026, partially set aside the arbitral award in the NHAI-KEPL dispute. Claims relating to the crucial Termination Payment and the interest accrued on it have been set aside by the court. Other non-termination claims under the arbitral award have been successfully upheld by the court.

Background: The Rohtak–Bawal Highway Project

The dispute arose from a Concession Agreement dated 13 July 2010 executed between the National Highways Authority of India (NHAI) and M/s Kurukshetra Expressway Private Limited (KEPL) for the design, construction, development, financing, operation and maintenance of the four-laning of the Rohtak–Bawal section of National Highway-71 in Haryana under the National Highways Development Programme (NHDP-III). The concession period was fixed at twenty-eight years commencing from the appointed date of 10 May 2011.

Following completion of substantial construction work, provisional completion certificates were issued in 2013 and 2014, toll collection commenced in September 2013, and the final completion certificate was issued on 13 August 2018.

Termination and Arbitration

In the financial year 2021-22, KEPL issued a notice of termination of the Concession Agreement vide letter dated 7th October, 2021 to NHAI on account of continuous disruption and blockade of traffic on National Highway-71 due to farmer agitation with stoppage of toll collection.

The joint venture previously secured a landmark arbitration award of more than ₹1,000 crore against NHAI in August 2024. KEPL had originally received two arbitration awards on August 16, 2024 related to the terminated Rohtak-Bawal NH-71 project.

The High Court's Reasoning

The Tribunal awarded Rs. 911.13 crore towards termination payment, computed on the basis of a "Total Project Cost" of Rs. 1045.5 crore notified through a disaggregation letter, as against the contractual ceiling of Rs. 650 crore prescribed under Article 48.1 of the Agreement.

The Court held that Arbitral Tribunal re-wrote Concession Agreement by allowing a unilateral disaggregation letter to override the contractually defined ceiling on "Total Project Cost", erasing risk allocation negotiated between the parties.

Status of Other Claims

In its July 28, 2026 order, the court upheld all claims except the Termination Payment and interest thereon, which were set aside following NHAI's Section 34 challenge filed in December 2024. The partial setback impacts the final settlement amount KEPL can claim from NHAI, though the majority of the awarded payments remain intact.

Next Steps

Kurukshetra Expressway Private Limited (KEPL) plans to file a legal appeal to contest the set-aside portion based on legal counsel.

About the Joint Venture and Parent Company

Kurukshetra Expressway Private Limited is a 49.57% joint venture of Kalpataru Projects International Limited. Established in 1981, Kalpataru Projects International Limited (KPIL) is among India's largest engineering and construction firms, publicly listed and renowned for its expertise in a diverse range of sectors. The company provides services including power transmission and distribution, building and factory construction, water supply and irrigation, railway infrastructure, urban infrastructure, and oil and gas pipeline construction.

KPIL reported annual consolidated revenue of ₹27,143 crore for FY26, representing a growth of 22% YoY. The company's consolidated net debt decreased by 53% YoY to ₹915 crore at the end of FY26.