The Supreme Court has examined a high-stakes arbitration battle between SEPCO Electric Power Construction Corporation and GMR Kamalanga Energy Ltd. (GMRKE) over the construction of three coal-based power units in Odisha.
The dispute arose after delays, fuel shortages, and the suspension of a fourth unit triggered competing claims worth thousands of crores. In 2020, an arbitral tribunal directed GMRKE to pay SEPCO nearly ₹995 crore, holding that project delays were largely attributable to GMRKE.
GMRKE challenged the award before the Orissa High Court. While a single judge upheld the award, a division bench later overturned it, faulting the tribunal for misreading contracts, ignoring “no oral modification” clauses, and relying on incorrect technical data.
SEPCO then appealed to the Supreme Court, arguing that the High Court had exceeded its limited powers under the Arbitration and Conciliation Act by re-evaluating the merits. GMRKE maintained that the tribunal had effectively rewritten the contracts and denied it a fair hearing.
The apex court has reviewed arguments on the scope of judicial interference, the validity of waiver and estoppel in the face of strict contractual clauses, and the tribunal’s approach to termination rights and performance tests. The ruling is expected to have far-reaching consequences for large-scale infrastructure contracts and the enforcement of arbitral awards in India.
- Case: Sepco Electric Power Construction Corporation Vs Gmr Kamalanga Energy Ltd
- Citation: 2025 INSC 1171
- Bench: CJI B.R. Gavai, J Augustine George Masih
- Judgement Date: 26th September 2025
Click HERE for full judgmemt.
Written By: Shubh Tewari
Lawcutor 