VA Tech Wabag Wins Arbitration Against Kerala Water Authority

Va Tech Wabag Ltd (WABAG) has secured a significant arbitration award against the Kerala Water Authority, as reported in a recent stock exchange filing. This development stems from a dispute concerning contract agreement no. 10/2006, dated October 13, 2006, related to the JBIC Assisted Kerala Water Supply Project, Package-1 works for the Cherthala Scheme, which includes the Intake Water, Raw Water Transmission Main, and Water Treatment Plant.

The Hon’ble High Court of Kerala appointed Justice (Retd) A. V. Ramakrishna Pillai, a former judge of the Kerala High Court, as the sole arbitrator on December 17, 2019, to adjudicate the disputes between the parties involved. After a thorough review of the case, the Hon’ble Arbitrator delivered a favourable verdict for Va Tech Wabag Ltd.

The arbitration decision rejected the counterclaims filed by the Kerala Water Authority amounting to ₹83 crore. Instead, the arbitrator upheld the claims made by Va Tech Wabag Ltd, including the return of a bank guarantee amounting to ₹23,24,29,700 and the release of ₹12,86,70,359. Furthermore, the arbitrator awarded 9% interest on these amounts from the date of the award, July 3, 2024, until the date of the payment realisation.

This decision marks a significant victory for Va Tech Wabag Ltd, reinforcing the company’s stance and claims in the prolonged dispute. The arbitration award not only ensures the return of a substantial bank guarantee but also secures the release of additional funds that will positively impact the company’s financial standing. The awarded interest further compensates WABAG for the period during which the funds were withheld, thereby enhancing the overall financial benefit of the award.

Va Tech Wabag Ltd is renowned for its expertise in water treatment solutions and has a strong track record of delivering complex water infrastructure projects globally. This arbitration award underscores the company’s commitment to upholding its contractual rights and reinforces its position as a reliable partner in the water management sector.

About Va Tech Wabag Ltd

Va Tech Wabag Ltd is involved in the water treatment business. The company’s principal activities include designing, installing, constructing, supplying, and operating drinking water, industrial water treatment, wastewater treatment, and desalination plants.

On July 4, 2024, the share price of Va Tech Wabag Ltd opened at ₹1,323.45, touching the day’s high at ₹1,344.10, as of 9:50 AM on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.