The
learned counsel for the appellant invited our attention to the fact that
the decision in the case of Madhya Pradesh Rural Road Development
Authority was rendered nearly four years after the date of the award.
However, in paragraph 17 of the said decision, this Court observed that if an
award is already made by the Arbitrator and if the objection to
the jurisdiction of the Arbitrator was not raised at an appropriate
stage, the award may not be annulled only on that ground. The
learned counsel submitted that the respondents did not challenge
the order passed by the High100
Court under Section 11(6) of the Arbitration Act. The objection
regarding the jurisdiction of the arbitration was raised only in120 the written submissions. He
would, therefore, submit that the award could not have been set aside
based on the decision of this Court.
The
learned counsel for the respondents submitted that, as seen from the
award, a contention was raised in the written statement filed before the
Arbitrator that the appellant should have taken recourse to Section 7 of the
1983 Act. Therefore, the dispute was raised at the appropriate stage, and
hence, paragraph 17 of the decision in the200
case of Madhya Pradesh Rural Road Development Authority will have no
application.
A
few factual aspects will have to be noted. After the contract granted to
the appellant was rescinded, the appellant invoked Section 7 of the 1983
Act by240 approaching the
Arbitration Tribunal. By the order dated 19th April 2010, the
Arbitration Tribunal held that in view of the arbitration clause in the
contract, the 1983 Act will have no application and the appellant will have to
take recourse to the Arbitration Act.
In
view of this order, the appellant invoked the jurisdiction of the High Court
under Section300 11(6) of the
Arbitration Act by filing a petition for the appointment of an
Arbitrator. The order dated 22nd July 2011 passed by the High Court on the said
petition shows that the respondents' opposition was only on the merits of the
claim. The objection based on the applicability of the 1983 Act was not
raised.
The
respondents did not360
challenge the order of appointment of the Arbitrator passed by the High Court
under Section 11(6) of the Arbitration Act. Even before the learned Arbitrator,
Section 16(1) of the Arbitration Act was not invoked to raise the
jurisdiction issue. However, 400
in the written statement filed before the Arbitrator, the contention
regarding the applicability of the 1983 Act was raised.
Now,
coming to the decision of this Court in the case of Madhya
Pradesh Rural Road Development Authority, after considering the provisions of
the 1983 Act and the Arbitration Act, in the light of Section 2(4) of
the Arbitration Act, this Court held that although there was an arbitration
clause, the 1983 Act would apply. As noted earlier, in the facts480 of the case, before taking
recourse to the Arbitration Act, the appellant had taken recourse to Section 7
of the500 1983 Act. The order
of the Arbitration Tribunal, holding that the Arbitration Act will apply, led
the appellant to file a petition under Section 11(6) of the Arbitration Act,
which was not objected to on the grounds of the applicability of the
1983 Act. The objection of the State government was confined to the
merits of the claim.
The
award is only in the sum of Rs. 6,50,000/- with interest. The award was made on
25th April 2014. Therefore, in the facts of the case, it will be
unjust to set aside the award only on the ground of the600 failure of the appellant to take
recourse to the 1983 Act. In fact, the appellant had taken recourse to the 1983
Act before seeking the appointment of an Arbitrator. In this case,
as can be seen from the impugned judgment, the award has been set aside only on
the ground that the appellant ought to have invoked the provisions of the 1983
Act.
Even
assuming that the observations in paragraph 17 of the decision in the case
of Madhya Pradesh Rural Road Development Authority, are not applicable,
this is a fit case to exercise jurisdiction under Article 142 of the700 Constitution of India to ensure that
complete justice is done. Therefore, by setting aside the impugned
judgment, the appeal under720
Section 37 of the Arbitration Act will have to be restored with a
request to the High Court to decide the same on merits.
Accordingly,
the impugned judgment dated 12th May 2022 passed in the Review Petition
no.584 of 2021, and the order dated 5th July 2021 passed in the Arbitration
Appeal no.45 of 2019 are set aside. The Arbitration Appeal no.45 of 2019 is
restored to the file of the High Court of Madhya Pradesh, Principal Seat at
Jabalpur.800 The restored
appeal shall be listed before the roster bench on Monday, the 30th
September 2024. The parties to the appeal shall appear before the High Court on
that day, and no further notice of the date fixed in the840 appeal shall be given to the parties. On
30th September 2024, the High Court will fix a date for hearing the restored
appeal, which shall be heard and decided in accordance with law and in
light of the observations made in this judgment. All the issues on the
merits of the restored appeal under Section 37 of the Arbitration Act900 are kept open. However, the award should
not be set aside on the grounds of the applicability of the 1983 Act.
If
the appellant has withdrawn the amount paid as per the award, the same shall be
deposited by the appellant with the High Court within two months from today.
The amount shall be invested by the High Court in960 a fixed deposit with any nationalised
bank till the disposal of the restored appeal. The High Court, while
deciding the appeal, shall pass appropriate directions regarding the withdrawal
of the amount with interest accrued thereon.995
ENGLISH SHORTHAND LEGAL DICTATIONS
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