State of M.P. vs M/s. Singh Construction Company

V.K. Agrawal, J.

This revision is directed against the order dated 18.4.1995 passed in Execution Case No. 8-A/1994 whereby the application of applicant/judgment - debtor u/s. 47 C.P.C. r/w. sec. 37 (3) of the Arbitration Act as also r/w. Sec. 20 of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 has been dismissed.

The facts in brief leading to the present revision are; that the non-applicant/contractor was awarded 3 contracts, namely, (1) 7/D. L. 8081 (K. M. 73), (ii) 8/D. L./ 80-81 (kilometer 80) & (iii) 18/D. L./81-82 (kilometer 74). A dispute having arisen regarding the said contract, the non-applicant made a request to the Superintending Engineer for referring the dispute to the arbitrator and on his failing to do so, he filed an application u/s. 20 (i) of the Arbitration Act 1940 before the District Judge with a prayer that the dispute be referred to the arbitrator under the arbitration clause of the aforesaid contracts. The above application was registered by District Judge as Civil Suit No. 8-A/1985 and vide his order dated 8.11.1985 the said application was dismissed. The non-applicant filed Misc. Appeal No. 141/86 against the said order dated 8.11.1985, which was allowed by this Court vide order dated 30.11.1989 holding that the objections raised by the non-applicant were not tenable and direction was issued to the trial Court to dispose of the application expeditiously. Thereafter, allowing the said application, the District Judge referred the matter to the Arbitrator. Shri V. S. Subbarao, retired Chief Engineer was appointed as Arbitrator. The arbitrator awarded Rs. 12,60,370/- with interest @ 12% -per annum in favour of the non-applicant. The non-applicant applied to the District Judge for making the award a rule of the Court and by order dated 1 fi.4.1994 the said award was made a rule of the Court. The applicant again preferred an appeal No. 899/94 before this Court, which was dismissed by the Division Bench by its order dated 13.12.1994, as time-barred. Against the said order of the Division Bench, an SLP No. 7500 of 1995 was preferred in the Supreme Court, which has also been now dismissed.

The applicant in the execution proceedings filed objection u/s. 47 C.P.C. r/w. Sec. 37 (3) of the Arbitration Act and had asserted that though the non-applicant alleged that he raised certain claims before the Superintending Engineer in his first application u/s. 20 (i) of Arbitration Act, 1940 and that those claims were rejected by the Superintending Engineer, but the non-applicant in fact did not make any claim before the Superintending Engineer and, therefore, the question of rejection of any such claim by the Superintending Engineer does not arise at all. It has further been alleged that under clause 4.3.29 (1) of the Arbitration Agreement, the contractor was obliged to demand to Superintending Engineer for arbitration within 28 days of the refusal of the claim by the Superintending Engineer but such a demand was not made within the aforementioned prescribed time. Therefore, the award of the Arbitrator is vitiated because the proceedings were without jurisdiction, illegal and void.

It has also been urged in the present petition that the provisions of C.P.C. and Arbitration Act, 1940 are not applicable, in view of the fact that M.P. Madhyastham Adhikaran Adhiniyam, 1983 had come into force and, therefore, the jurisdiction regarding the dispute vested in the Arbitration Tribunal. Therefore, the proceedings before the Arbitrator are illegal, void and consequently ineffective. The non-applicant has not made his claim with clean hands and has suppressed material facts and, therefore, the award and proceedings are void and illegal.

The above objections which were raised by the applicant before the District Judge were replied to by the non-applicant. The District Judge dismissed the above objections raised by the applicant by the impugned-order dated 18.4.1995.

The first question in this revision is that in view of coming into force of the M.P. Madhyastham Adhikaran Adhiniyam, 1983, the District Judge had no jurisdiction to make reference to the arbitrator and, therefore, the whole proceedings before the District Judge as well as the Arbitrator and the consequent award and making it a rule of the Court are vitiated. It has next been urged that the non-applicant contractor did not make a demand with the Superintending Engineer for'' appointment of arbitrator therefore u/s. 37 (3) of the Arbitration Act, the non- applicant is not entitled to any benefit. Thirdly, it has also been urged during arguments by the learned counsel for the applicant that the claim of (he non-applicant should have been for on ascertained sum and should have been quantified.

As against this, the learned counsel for the non-applicant/contractor has urged that the objections of the applicant regarding applicability of Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983 and not making the demand for referral of the dispute to arbitrator the claim within 30 days, have already been decided by this Court in M. A. No. 141/86 vide order dated 30.11.1989 and those objections cannot br raised again. In support of the above contention, the copy of the said order dated 30.11.1989 in Misc. Appeal No. 141/86 has been filed. It is noticed that in the order passed in the said Misc. Appeal objection was raised by the applicant that proceedings u/s 20 of the Arbitration Act, in view of the bar contained is section-20 (2) of M.P. Madhyastham Adhikaran Adhiniyam, 1983. However, relying on the Division Bench case of Spodra Engineering Corporation v. State of M.P. 1988 J .L .J. 601, wherein it was held that the M.P. Madhyastham Adhikaran Adhiniyam, 1983 is prospective, it was observed that since in the instant case the request for making reference to the Arbitrator was pending before the Superintending Engineer on the date the said Adhiniyam was enforced, the objection was rejected. It is clear that in view of the above decision between the parties, the matter cannot be reagitated.

Similarly, the objection that the non-applicant did not make the demand to the Superintending Engineer within 20 days, i. e. with the stipulated period was also considered in detail, and it was held in Misc. Appeal No. 141/86 that the request for referring the matter to the arbitrator was made within the said period. Therefore, the application u/s. 20 of the Arbitration Act could not be rejected on the point of limitation. This point also being decided in favour of the non-applicant in the earlier dispute between the parties, by order dated 30.11.89 in Misc. Appeal No. 141/86, the matter cannot be permitted to be reagitated.

Now, the only ground that has been urged in this revision and which remains to be considered is as to whether the claim before the Superintending Engineer ought to have been put-up for ascertained sum or in other word, should have been quantified ? The learned counsel for the applicant was asked as to whether there is any clause in the agreement between the parties, which required such an action on the part of the non-applicant, to which the learned counsel replied in the negative. None of the provisions of the Arbitration Act necessitate putting up a quantified claim. In fact, probably the learned counsel for the applicant has based his arguments on the basis of definition of ''dispute'' up given in Section 2 (d) of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam 1983, which is reproduced as below :-

(d) "dispute" means claim of ascertained money valued at Rupees 50,000 or more relating to any difference arising out of the execution or non-examination of a works contract or part thereof;

The definition of ''dispute'' as-above, appears to have been amended by Act No. 9/1990 so as to include ascertained money dispute. However, as has been earlier mentioned, the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983 is not applicable to the dispute in hand between the parties, hence the contention of the applicant that the non-applicant was obliged to make claim for ascertained sum of money so to constitute dispute cannot be uphold. In fact, as has been pointed out earlier, there is no clause of the contract between the parties, which required ascertained sum of money of quantified claim we be putforth before the Superintending Engineer. There does not appear to be any other legal obligation on the part of the non-applicant to have done so. Therefore, the contention of the applicant that so as to constitute ''dispute'' the claim for ascertained sum of money should have been putforth cannot be sustained.

No other grounds have been urged is this revision, which according to me, merits to be dismissed, as devoid of substance.

Therefore, the revision is dismissed. The parties shall bear their own costs.