In Brief
A contractor (SAPL) claimed enhanced rates for work performed under a sub-contract, arguing that as a "back-to-back" contract, it should receive the same rate increases that the intermediary contractor (PCL) had negotiated with the principal contractor (HSCL). An arbitrator awarded Rs. 19,38,357 based on these enhanced rates. The Supreme Court held that the sub-contract between SAPL and PCL lacked express incorporation clauses binding it to the HSCL-PCL agreement. The arbitrator therefore erred in applying contract terms not governing the parties' actual agreement. SAPL's entitlement was limited to escalation relief under Clause 16 (Rs. 7,17,560), not the enhanced rates claimed. The appeal was dismissed.
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