HAL Offshore in $3m battle with ONGC

Vol 18, PW 15 (26 Mar 15) News in Brief

HAL Offshore has dragged ONGC to the Delhi High Court in a dispute over a three-year O&M contract for multi-support vessel Samudra Suraksha.

On April 16, Justice Rajiv Shakdher will ask ONGC to explain why it rejects the majority recommendation of a three-man arbitration panel set up after the contract expired in 2010 that HAL should be compensated for losses. “The arbitration panel agreed unanimously HAL should be compensated,” we hear.

“But there was a split verdict on the amount: two said HAL should receive Rs20cr ($3m), one said Rs8cr ($1.2m). HAL asked ONGC to accept the majority view but ONGC offered only Rs8cr saying, ‘take it or leave it!’” In a March 3 court note Justice Shakdher says, “The conduct of the respondent (ONGC) seems to be unfair.

The respondent (ONGC) seems, firstly, to take the stand that the (arbitration) recommendation is not binding. Secondly, if it is agreeable to abide by the minority view the (ONGC) Board needs to revisit the issue.