NCLT Mumbai Dismisses JV Claim Against ITNL, Upholds Reduction After Contract Novation

April 7, 2026 : The Mumbai Bench-I of the National Company Law Tribunal has dismissed an application filed by a joint venture between Amritanshu Infrastructure & Management Private Limited and Beigh Construction Company Private Limited, challenging the reduction of its claim against IL&FS Transport Network Limited (ITNL). The Tribunal held that the joint venture’s claim could not survive once the underlying contract stood novated in favour of Beigh Construction Company.

The application was directed against Grant Thornton India LLP, acting as the Claim Management Agency (CMA) in the IL&FS resolution process, seeking reinstatement of a claim of ₹4.27 crore towards retention money and other dues.

The dispute arose from a tunnel excavation project in Jammu & Kashmir, for which the joint venture had submitted its claim in July 2019. While the CMA initially admitted the claim to a substantial extent, it later revised the admitted amount after being apprised of a novation agreement dated 1 August 2015.

The Tribunal noted that the joint venture, formed with a 51:49 shareholding between Amritanshu Infrastructure and Beigh Construction, had originally executed part of the contract awarded by ITNL. However, through a letter dated 31 July 2015 and subsequent communication dated 1 August 2015, the parties agreed that the remaining works would be executed solely by Beigh Construction. The novation resulted in substitution of Beigh Construction in place of the joint venture, with the latter ceasing to be a party to the contract.

On examining the legal effect of the novation, the Tribunal held that all rights and obligations relating to future performance stood transferred to Beigh Construction. It emphasised that the novation agreement clearly provided that the joint venture would no longer remain a contracting party.

Addressing the claim for retention money, the Tribunal observed that such amounts become payable only upon completion of the project and expiry of the defect liability period, which is linked to issuance of the final completion certificate. Since the completion was to be undertaken by Beigh Construction post-novation, entitlement to retention money would vest in that entity.

The Bench further noted that the novation agreement did not contain any saving clause preserving the joint venture’s right to claim retention money from ITNL. It observed that if the parties intended to retain such rights, the same should have been expressly stipulated in the agreement or related correspondence.

On the contention that the CMA lacked authority to revise an already admitted claim, the Tribunal held that upon being presented with material facts such as the novation agreement, the agency was duty-bound to update the claim in accordance with the correct legal position. It added that even if prior approval was required, the issue had now been independently examined on merits.

Concluding that the claim lacked merit in view of the novation, the Tribunal upheld the reduction of the admitted claim and dismissed the application. However, it clarified that its findings would not prejudice any independent rights of the applicant to seek recovery from Beigh Construction Company, if available in law.

Case Title: Amritanshu Infrastructure & Management Private Limited & Anr. v. Grant Thornton India LLP & Ors.
Case No.: CA No. 136 of 2022 in Company Petition No. 3638 of 2018
Coram: Shri Sushil Mahadeorao Kochey (Member Judicial) and Shri Prabhat Kumar (Member Technical)