AMARAVATI, India, May 15 -- Andhra Pradesh High Court issued the following order on April 10:

1. This is an application filed under Section 11 (5 & 6) of the Arbitration and Conciliation Act, 1996 (for short, "the Act of 1996"), seeking the appointment of an arbitrator for purposes of adjudicating the disputes arising out of and in connection with the Agreement, dated 01.07.2020.

2. The Agreement was executed, it is stated, for providing the Services of Mobile Medical Units (104 Ambulances) across the State of Andhra Pradesh. The agreement was to remain in force for a fixed period of seven years commencing from 01.07.2020 and ending on 30.06.2027.

3. It is further stated that upon confirmation of the applicant's selection as the service provider, the applicant furnished Performance Security in the form of Bank Guarantees amounting to approximately Rs.43.85 Crores issued by HDFC Bank, which were renewed from time to time and are stated to remain valid until 31.07.2027.

4. The applicant claims that it demonstrated exemplary performance in operating Mobile Medical Unit (MMU) Services, including medical outreach and health camps, in difficult conditions and in the public interest, despite which the respondent committed material breaches of the Agreement, which included delays in payment, arbitrary deductions and penalties imposed, without there being any contractual basis, and expanded the scope of work without corresponding reimbursements.

5. The applicant further claims that in the public interest and at the request of respondent, the applicant handed over the assets and operations to a new service provider, M/s. Bhavya Health Services Private Limited, which was without prejudice to the applicant's right to claim the outstanding dues.

6. It is also stated that the applicant sought unconditional release of the Bank Guarantees, which was rejected, and that steps were taken to invoke the Bank Guarantees without prior notice

7. The applicant submits that the invocation of the Bank Guarantees was stayed by the Commercial Court at Vijayawada in terms of Section 9 of the Act of 1996, vide order dated 15.10.2025.

8. A Notice dated 30.10.2025, under Section 21 of the Act of 1996, it is stated, was served upon the respondent, nominating Justice D. V. S. S. Somayajulu as their Arbitrator, which notice did not elicit any response from the respondent, and hence the present Arbitration Application.

*Rest of the document can be viewed at: (https://hcservices.ecourts.gov.in/ecourtindiaHC/cases/display_pdf.php?filename=I1mmm2bl4r4EREhYK63Kv5afQ1kyL6d3IAxNEV2BUTpJgXFKPF13Hqj4efLk5V3v&caseno=ARBAPPL/6/2026&cCode=1&cino=APHC010032112026&state_code=2&appFlag=)

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