NSE/BSE Codes: NSE: KPIL, BSE: 522287

Summary of Key Information:

Nature of Event / Disclosure:

Regulatory disclosure under SEBI LODR Regulation 30 regarding ongoing litigation and court orders related to an arbitral award between the company's joint venture, Kurukshetra Expressway Private Limited (KEPL), and the National Highways Authority of India (NHAI).

Involved Parties / Authorities:

  • Kurukshetra Expressway Private Limited (KEPL): A 49.57% joint venture of Kalpataru Projects International Limited.
  • National Highways Authority of India (NHAI): The counterparty to the original Concession Agreement.
  • Hon'ble Delhi High Court: The judicial authority that issued the orders.
  • Arbitral Tribunal: The body that issued the original award in favor of KEPL.

Date / Timeline of Event:

  • 13th July 2010: Concession Agreement executed between KEPL and NHAI for the Rohtak-Bawal highway project.
  • 25th December 2020: Toll collection suspended due to farmer agitation (Force Majeure event).
  • 7th October 2021: KEPL issued a Notice of Termination of the Concession Agreement to NHAI.
  • October 2021: KEPL account declared an NPA as it could not pay lenders post-termination.
  • 16th August 2024: KEPL received two arbitration awards in its favor from the arbitral tribunal, including a "Termination Payment".
  • 11th December 2024: KEPL received advance copies of NHAI's application challenging the awards under Section 34 of the Arbitration Act.
  • 28th July 2026: The Hon'ble High Court passed an order partially setting aside the arbitral award, specifically setting aside the award for the Termination Payment and related interest.
  • 28th September 2026: The Hon'ble Delhi High Court upheld its earlier order dated 28th July 2026, dismissing KEPL's appeal under Section 37 of the Arbitration Act.
  • 29th September 2026: Kalpataru Projects International Limited intimated the exchanges of the court's order, received on 28th September 2026 at 6:32 PM.

Brief Description of Outcome / Dispute:

The dispute concerns the termination of a Concession Agreement for the four-laning of the Rohtak-Bawal section of NH-71 in Haryana on a DBFOT basis. The project was terminated by KEPL in 2021 citing a Force Majeure event (farmer's agitation leading to forcible suspension of toll collection). An arbitral tribunal awarded various payments, including a Termination Payment, to KEPL. NHAI challenged this award in court. The Hon'ble High Court partially set aside the award, specifically nullifying the Termination Payment and interest on it, while upholding awards on all other claims. KEPL's appeal against this partial setting aside was dismissed by the court.

Impact of Outcome:

Financial Impact:
  • The initial arbitration award included a "Termination Payment," but the exact monetary value was not disclosed in the provided documents.
  • The Hon'ble High Court has set aside the award for the Termination Payment and interest thereon. Therefore, this potential financial gain for KEPL (and consequently for KPIL) has been nullified by the court order.
  • As per the October 2021 disclosure, the company had to provide for an impairment in its investment in KEPL, the amount of which was to be communicated with Q2 results (not provided in this data).
  • The financial impact on the company from the latest court order is the confirmation of the non-receipt of the Termination Payment. The company stated that the financial impact upon crystallization of awarded claims would be disclosed in due course, but the key claim has been set aside.
Operational / Business / Strategic Impact:
  • The project was terminated in 2021, so there is no ongoing operational impact on the project itself.
  • The event led to KEPL's account being classified as a Non-Performing Asset (NPA) in October 2021 as per RBI guidelines, impacting its financial standing.
  • The strategic impact involves a prolonged legal battle with a government authority, consuming management time and legal resources.

Other Implications:

The implications are primarily legal and regulatory, involving the interpretation of concession agreements and arbitration outcomes in public infrastructure projects.

Next Steps / Required Actions:

  • Based on legal advice, KEPL believes it has a strong case and is taking appropriate legal steps to challenge the order dated 28th September 2026.
  • This includes filing an appropriate petition (likely a further appeal) in a higher court.