The main legal point established in the judgment is that in works contracts involving the State Government, disputes must be raised before the Tribunal constituted under the M.P. Madhyastham Adhikaran Adhiniyam, 1983, excluding the forum under the Arbitration and Conciliation Act, 1996.

Sanjay Yadav, J.

1. Rejection of application seeking amendment in the application for setting aside Arbitration Award under the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'AC Act') by order dated 14.2.2014 by the Seventh Additional District Judge, Bhopal has led the objector to an Award file this writ petition under Article 227 of the Constitution of India.

2. Undisputed facts borne from the record are that a contract for consultancy and its implementation services for third party evaluation and quality control/assurance for construction of building costing about Rs.75,372.31 lakh in accordance with specifications and relevant I.S. Codes using funds provided by Rajya Shiksha Kendra Bhopal was entered into between the petitioner and respondent on 29.1.2007.

3. That, on there being certain allegations of contractor entering into certain unlawful activities in respect of payment of first and second bills, an enquiry was caused. Pending the outcome of said enquiry, respondent-contractor was stopped from carrying out further work. This gave rise to a dispute for non-payment of bills and associate claim.

4. Since there exists an arbitration clause 16 in the Agreement stipulating that "Any dispute arising out of the contract, which cannot be amicably settled between the parties, shall be referred to adjudication at Bhopal in accordance with the Arbitration and Conciliation Act, 1996; contractor invoking the same sought the resolution of the dispute through an arbitration by filing an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 before the High Court vide Arbitration Case No.15/2008 for appointment of Arbitrator. That, sole arbitrator, retired Judge of this Court Hon. Shri Justice S.S. Jha, was appointed by order-dated 4.9.2008.

5. An Award came to be passed on 10.7.2010; whereby, while allowing the claim by the contractor, the counter claim by the State of M.P. (petitioner) was dismissed.

6. Aggrieved, the State Govt. and its functionaries brought an action under Section 34 of AC Act on 28.10.2010; wherein, on 7.8.2013, an application seeking amendment in the objection under Section 34was filed to the effect of incorporating the objection as regard to jurisdiction of the Arbitrator to entertain the dispute under AC Act on the plea that being a 'work contract' and the State Government being one of the parties to the contract, the jurisdiction lay with the Arbitration Tribunal constituted under the M.P. Madhyastham Adhikaran Adhiniyam, 1983. The amendment was objected at by the respondents herein on three grounds, viz. that -

(i) the ground for challenge being sought to be added after a period of 120 days is barred by time as the time limit prescribed under AC Act is absolute and unextendable;

(ii) the order appointing the sole arbitrator having been allowed to attain finality and the objector having participated in the proceedings is precluded from raising the objection having acquiesced and

(iii) the judgment in M.P. Rural Road Development Authority vs. L.G. Choudhary Engineers and Contractors : (2012) 3 SCC 495 is not applicable in the given facts.

7. Objections to amendment having found favour led the Court reject the application for amendment by impugned order by taking into consideration the fact that the objector having not questioned the appointment of Arbitrator which, in turn, was by virtue of order by the High Court in a proceeding under Section 11(6) of AC Act and thus, acquiesced to the proceedings is estopped from raising the objections which, if allowed, would swipe the very appointment of the Arbitrator. In order words, the objection as to jurisdiction of the Arbitrator, if allowed, to be taken the same would tantamount to question the correctness of order under Section 11(6) of AC Act, which attained finality. The Court also found that the preliminary objection raised at the stage of Section 34 of AC Act also suffers from limitation.

8. Assailing the order, it is