The Madras High Court has restrained Yuzhan Technology India, a Foxconn subsidiary, from continuing certain project works till June 29 amid an ongoing contractual dispute with BNR Infrastructure Projects.
According to a report by Bar and Bench, the dispute stems from an agreement signed between Yuzhan and BNR on Oct. 29, 2025, following which Yuzhan issued a letter of award to BNR. The relationship later soured over alleged delays in project execution, prompting Yuzhan to issue a partial termination notice on May 30.
The matter is currently before a sole arbitrator. Meanwhile, BNR approached the High Court seeking interim relief, including an injunction against the invocation of bank guarantees worth Rs 310 crore and a stay on the termination notice.
Justice K Kumaresh Babu examined the contractual provisions governing post-termination obligations and noted that Clause 18.1.3 grants BNR a 30-day period from the date of termination to complete certain obligations. These include handing over completed works, project materials, documents and facilitating the transition process.
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Since the termination notice was issued on May 30, the Court observed that the 30-day period would expire only on June 29.
“In view of the same, this Court is of the view that the respondent cannot claim to continue to do work either by itself or by any third parties till 29.06.2026,” Justice Kumaresh Babu said.
The Court held that Yuzhan's rights under Clause 18.1.7 to continue the remaining work would arise only after the expiry of the post-termination period and compliance with the contractual mechanism.
“Till the time expires under Clause 18.1.3, the respondent cannot be heard to say that under Clause 18.1.7, the respondent is entitled to continue the work,” the Court said.
BNR had argued that Yuzhan could not engage other contractors or use BNR-owned materials and equipment at the project site immediately after issuing the termination notice. Senior Advocate P.S. Raman, appearing for BNR, contended that delays were attributable to Yuzhan, including delays in handing over the site and finalising project designs.
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Yuzhan, represented by Senior Advocate Sathish Parasaran, argued that BNR had failed to complete the project within agreed timelines and that the delays jeopardised incentives linked to the timely establishment of the facility. The company also maintained that it was entitled under the contract to complete the remaining work on its own or through third parties after termination.
The Court declined to examine the merits of the dispute, noting that arbitration proceedings are already underway, and confined its ruling to the limited issue of whether Yuzhan could continue the works before the expiry of the contractual notice period.
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