When Winning an Arbitration Case Isn’t Enough: Lessons from Executive Engineer (CCW), All India Radio v. M/s B Prasad & Co. (2026)

Background of the Case

The dispute arose out of a construction contract awarded in 2007 by the Civil Construction Wing of All India Radio for the construction of 38 staff quarters in Patna. The contract, valued at approximately ₹3.4 crore, was scheduled for completion in 2009.

Due to delays, the contract was ultimately terminated in 2012. Aggrieved by the termination, the contractor, M/s B Prasad & Co., invoked arbitration.

By an award dated 10 May 2014, the arbitral tribunal held that the delay was attributable to the government department and allowed the contractor’s claims. The tribunal awarded approximately ₹1.81 crore (inclusive of interest), along with future interest at the rate of 15% per annum until payment.

However, the dispute did not conclude with the award.

The government challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996. Simultaneously, the contractor initiated execution proceedings to enforce the award.

What Led to the High Court Proceedings

Over the years, the challenge proceedings remained pending. In the meantime, the contractor continued to pursue enforcement.

In June 2025, the executing court ordered attachment of the government department’s bank accounts due to non-payment of the awarded amount.

The government challenged this order before the High Court, contending that:

• The arbitral award was still under challenge
• Attachment of bank accounts would severely disrupt public functions
• The order was disproportionate and premature

Key Issue Before the Court

The principal question before the Court was:

Can coercive steps such as attachment of bank accounts be taken to enforce an arbitral award while a challenge to that award is still pending?

Decision of the Court

The High Court adopted a balanced and pragmatic approach.

It stayed the execution proceedings, including the attachment of bank accounts, and directed the concerned court to expeditiously decide:

• The Section 34 challenge to the award
• The application for stay under Section 36

Importantly, the Court imposed a strict timeline of 80 working days for disposal of these proceedings.

Through this approach, the Court sought to ensure that:

• The contractor’s right to enforcement is preserved
• The government is not subjected to irreversible financial consequences before final adjudication

Key Legal Takeaways

1. An Arbitral Award Does Not Ensure Immediate Recovery

• Enforcement may be contested
• Recovery can be delayed for years

2. A Section 34 Challenge Does Not Automatically Stay Enforcement

• Filing a challenge does not render the award unenforceable
• A separate application under Section 36 is required to seek a stay

3. Courts Exercise Discretion in Enforcement

• Whether the award is under challenge
• The financial and operational impact on parties
• Broader public interest

4. Delay Can Undermine the Value of an Award

5. Government Contracts Involve Additional Complexities

Conclusion

An arbitral award is only as effective as its enforcement.

For construction and infrastructure companies, dispute resolution does not end with arbitration. It extends into the enforcement stage—where legal strategy, timing, and execution ultimately determine the real outcome of the dispute.