NHAI Secures Major Arbitration Win in Bareilly–Sitapur Highway Case

BHPL submitted 30 claims worth around ₹3,177 crore, seeking compensation under various provisions of the concession agreement.

The National Highways Authority of India (NHAI) has secured a significant legal victory after an arbitral tribunal largely ruled in its favor in a long-running dispute over the Bareilly–Sitapur highway project in Uttar Pradesh, protecting thousands of crores of public funds.

The case relates to the 151-kilometre Bareilly–Sitapur BOT (Toll) highway project, which was developed by Bareilly Highways Project Limited (BHPL), a concessionaire promoted by Era Infra Engineering Limited. NHAI terminated the concession agreement in May 2019, leading to arbitration over financial claims and contractual obligations.

A three-member arbitral tribunal examined the claims filed by both parties before delivering its decision.

Only a small fraction of claims approved

BHPL submitted 30 claims worth around ₹3,177 crore, seeking compensation under various provisions of the concession agreement. After reviewing the evidence, the tribunal approved only three claims totaling ₹46 crore, along with applicable interest, while rejecting the vast majority of the concessionaire's demands.

The tribunal also upheld the validity of the Supplementary Agreement signed on 30 March 2015, concluding that delays in the project were the responsibility of both parties rather than being attributable to a single side. This finding played an important role in limiting the concessionaire's financial claims.

NHAI had also submitted counterclaims related to financial losses and inconvenience caused to the public. Although these counterclaims were not accepted, the authority successfully defended itself against the much larger compensation demands, significantly reducing its financial exposure.

Series of legal victories strengthens NHAI's position

The Bareilly–Sitapur decision adds to a string of favorable arbitration outcomes for NHAI this year.

In June 2026, the authority secured an arbitration award worth ₹1,202 crore in the Tumkur–Chitradurga six-laning project in Karnataka. Earlier, in April 2026, disputes linked to the Panipat–Jalandhar highway project involving concessionaire claims of about ₹8,375 crore and NHAI counterclaims of ₹2,888.64 crore were settled at ₹819.96 crore, producing another favorable outcome for the highway authority.

In May 2026, an arbitration case concerning the six-laning of the Kamrej–Chalthan section of NH-48 in Gujarat saw contractor claims of ₹174.49 crore reduced to an award of only ₹54 lakh.

Focus remains on protecting public funds

NHAI said the latest ruling reflects its commitment to strong contract management and an effective legal strategy in handling infrastructure disputes. The authority believes these outcomes reinforce transparency, contractual discipline and responsible use of public resources while supporting the continued development of India's national highway network.

The decision also highlights the importance of clearly defined contractual frameworks in large infrastructure projects, helping ensure that public investment is safeguarded while disputes are resolved through established legal mechanisms.