The National Rohtak-Panipat

Concession
Highways Tollway Private
Agreement
Authority of India Limited
Date – 9th
(Referred as (Referred as
day of
Authority) Concessionaire)
March 2010

The purpose of
the Agreement
 According to Indian Our Observation as
Contract Law, 1872 Students of Law

Authority want the highway project to be

When at the desire of the promisor, the
taken up on DBFOT basis and the
promise or any other person has done or
concessionaire receives the license to
abstained from doing such act or abstinence
construct, operate and maintain this project
is called consideration for the purpose.
for 25 years from the date of appointment
 Express vs Specific Vs
Offer General
Implied

When one person

signifies to another
his willingness to do Offer in the form of Offer made to a
or to abstain from written or oral words is definite person is a
doing something with an express offer. Offer specific offer, Offer
a view to obtaining made by conduct of made to group of
the assent of the parties such as positive persons or to the
other to such an act acts or signs is known public at large is called
or abstinence, he is as an implied offer. general offer.
said to make proposal
or offer.
According to Indian
Contract Law, 1872
 Our Observation
as Students of Law

Bidders made a
expressed and specific
offer to the Authority on
11th February 2009 as
given below.
 According to Indian
Contract Law, 1872
Every person is competent to contract who is
the age of majority according to the law to
which he is subject, and who is of sound
mind and is not disqualified from contracting
by any law to which he is subject
Our Observation as
Students of Law
Authority shortlisted the bidders based on
the qualifications (RFQ) and further
checked the technical and commercial
terms and condition (RFP) to verify the
capacity of parties/bidders in this case.
 According to Indian Our Observation as
Contract Law, 1872 Students of Law

When the person to The Authority accepted

whom proposal is made, the offer by selecting the
signifies his ascent bidder based on the
thereto, the proposal previously discussed
(offer) is said to be terms on the date
accepted. A proposal 04.01.2010 and issues
(offer) when accepted letter of award (LOA) as
becomes a promise. Agreement shown below.
presented in the
next slide
 When two or more persons
According to Indian agree upon the same thing
Contract Law, 1872 in the same sense then it will
be considered as consent.

Since we did not have any of the below

exercised by the bidder towards the
Our Observation as
Authority –
Students of Law
Coercion
Undue Influence
Misrepresentation
Fraud
Mistake
We can conclude that the agreement
was made on free consent.
 Breach - Violation of any of the agreed
terms and conditions of a binding contract
is called breach of contract. It can be an
Actual breach or Anticipatory breach.

Actual Breach – The party performing the

According to Indian contract commits a breach of the essential
Contract Law, 1872 condition to the Contract.

Anticipatory Breach – When one party

announces in advance of the due date for
performance that it intends not to perform
its side of the bargain.
From our Observation as Students of Law – we present two
remedies for breach of contract defined in the concession
agreement as examples to understand the concept better.

Concessionaire, upon failure to meet any condition precedent, authority can

appropriate the relevant amounts from the performance security and
concessionaire should replenish or provide fresh security based on the
appropriated amount within 30 days, upon which he shall be entitled to a
cure period of 90 days for remedying the default.

In the event of delay (more than 90 days from the appointed date) to
procure and grant all the land included in the appendix for any reason other
than Force Majeure or breach of this agreement by concessionaire, it shall
pay to concessionaire damages in sum calculated as the rate of Rs. 50 per
day for every 1000 square meter commencing from the 91st day till the day it
is procured.
 We have seen that both Concessionaire and the
Authority, are binding to the agreement and
breach of any agreed condition would result in
the penalty as agreed upon.

Hence parties involving in concession

agreement formulate the remedies for breach
Observations as of contract specific to their agreement to
Students of Law safeguard the interest of both the parties and
the contract as a whole.

Apart from the specific remedies agreed by the

parties, there are generally specified remedies
to be attended in case of breach of contract as
defined under Indian Contract Law
 Suo Motu
Suo motu, means "on its own
motion," is a Latin legal term,
approximately equivalent to the
term sua sponte. For example, it is
used where a government agency
acts on its own cognizance, as in
"the Commission took suo
motu control over the matter."
Force Majeure
The term force majeure relates to
the law of insurance and is f
requently used in construction c
ontracts to protect the parties
in the event that a segment of
the contract cannot be performe
d due to causes that are outside t
he control of the parties,
such as natural disasters, that
could not be evaded through the
exercise of due care.
 Letter of
Award(LOA)
Written confirmation of
an award of a contract by a
customer (owner or principal) to a
successful bidder, stating the
amount of the award,
the award date, and when the
contract will be signed. It may also
contain a notice to proceed, and it
is sometimes also used in lieu of a
purchase order to a vendor.
Escrow
Account
Escrow account refers to a
bank account held in the name
of the depositor or an escrow
agent which does not belong to
the depositor, but is returnable
to the depositor on the
performance of certain
conditions. This is also called
escrow deposit.
 DBFOT

In this model, the party assumes

the entire responsibility for the
design, construction, finance,
operate the project for the
period of concession and
transfer it towards the end.
THANK YOU