News & Media 2nd Dec 2021
Over the last few years, companies in the construction sector have been hit by cash flow concerns. While these companies may have obtained arbitral awards against government entities, it is seldom that the judgment creditor is able to secure the fruits of the award in a reasonable time, considering that a challenge to the award is a likely scenario. To bring much-needed relief to judgment creditors, National Institution for Transforming India Aayog (NITI Aayog) proposed measures to address the issues plaguing the construction sector, for consideration of the Cabinet Committee on Economic Affairs (CCEA). These measures have been introduced by way of amendment in the General Financial Rules, 2017.
Against this background, Naresh Thacker, Partner, supported by Alok Jain, Associate Partner and Ria Dalwani, Senior Associate & Sonia Dasgupta, Associate, Economic Laws Practice (ELP) have co-authored an article titled ‘A breather for construction projects under litigation’ for Construction Week Online. The article throws light on the significant relevance of the amendment, in the context of proceedings for the enforcement of an arbitral award under section 36 of the Arbitration and Conciliation Act, 1996. It further explains the implications of the recent insertion of Rule 227A in General Financial Rules (GFRs), 2017 for the construction companies.
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