NEW DELHI (Saturday, March 7, 2026) — Former Chief Justice of India UU Lalit has advocated for a specialized government agency to vet all infrastructure contracts before they are signed. Speaking at a conference in the national capital, he emphasized that rigorous early scrutiny could prevent massive arbitration disputes, potentially saving the public exchequer “thousands and thousands of crores.”
The Call for Specialised Screening
Justice Lalit delivered his remarks at the conference on “Dispute Resolution and Arbitration Norms for Construction and Infrastructure Sector: An Indian and International Perspective,” organized by the PHD Chamber of Commerce and Industry (PHDCCI).
- Primary Recommendation: Infrastructure and construction contracts should be screened by a dedicated agency within the respective ministry before “signing on the dotted line.”
- The “Profit Tool” Concern: He noted a troubling trend where arbitration claims in infrastructure projects often exceed the original project cost.
- Example: If a project cost is approximately ₹800 crore, claims frequently exceed ₹1,000 crore.
- Justice Lalit observed that this creates an impression that arbitration is being used by contractors as a tool to maximize revenue rather than simply resolve genuine disputes.
Key Drivers of Infrastructure Disputes
Drawing from his experience in nearly 20 construction arbitrations over the last three years, the former CJI identified several recurring issues:
| Issue | Description |
| Contractual Gaps | Poor drafting and a lack of precise norms for assessing claims at the tendering stage. |
| Environmental Halts | Recurring disruptions like GR-III and GR-IV measures (due to Delhi’s air pollution) are rarely anticipated in contracts, leading to idle-resource claims. |
| Inter-Departmental Lag | Projects involving multiple bodies—such as railway overbridges—often suffer from design changes after contracts are awarded. |
| Inaccurate Estimates | Insufficient attention paid to project planning and coordination before the execution phase. |
Supporting Perspectives
The inaugural session also featured former Supreme Court judge Justice Hema Kohli, who highlighted that as India undergoes massive investments in highways, railways, and logistics, the “legal architecture” must be as robust as the physical projects. She noted that in projects of such magnitude, disputes are not aberrations but “structural possibilities” that must be resolved with efficiency and predictability.
Sources
- Press Trust of India (PTI): “Early scrutiny of infrastructure contracts can save thousands of crores in disputes: Ex-CJI Lalit” (March 7, 2026)
- Millennium Post: “Ex-CJI Lalit advocates specialized agency for contract screening” (March 7, 2026)
- PHDCCI Official: Event Brochure – Dispute Resolution & Arbitration Norms (March 7, 2026)
- Hindustan Times: “Arbitration shouldn’t be a revenue tool for contractors: Former CJI UU Lalit” (March 7, 2026)
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