2017 Supreme(MP) 180

IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR
S.K. Seth, Sujoy Paul, J.P. Gupta, JJ.
Viva Highways Ltd. - Appellant
Versus
Madhya Pradesh Road Development Corporation Ltd. - Respondent
A.A. No.14 of 2017, 14 of 2017, A.C. No.27 of 2013, 79 of 2016
Decided on : 05-05-2017

The definition of "works contract" as defined under Section 2(I) of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 is wide enough to include the concession agreement if it fulfils the necessary ingredients of a works contract.

Headnote:

Whether, any agreement by whatever name called, if it falls within the meaning and definition of work contract as defined under Section 2(I) of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 has to be referred for adjudication before the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym? Whether, in view of statutory provisions of Section 7 of the Adhiniyam of 1983, the matter has to be referred to the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym, even in cases where the parties have incorporated a clause in agreement regarding resolution of dispute by some other forum or under the Arbitration and Conciliation Act, 1996? Which of the views taken by the Division Bench of Ashoka Infraways Ltd. is correct relying on Jabalpur Corridor (India) Pvt. Ltd. ? Whether, the substituted definition of work contract in the M.P. Madhyastham Adhikaran Adhiniyam, 1983 by Act No.7 of 2017 is clarifactory and is applicable to the pending or future contracts? Any other ancillary issues arising out of the reference order.

Fact of the Case:

The order of reference dated 31.1.2017 which occasioned the constitution of this Full Bench has been passed by a Division Bench in AC No.27/2013 (M/s ESSEL Infra Projects Ltd. v. State of M.P.). The relevant facts giving rise to the reference are that the aforesaid arbitration case filed under Section 11(6) of Arbitration and Conciliation Act, 1996 (for short 'Act of 1996') was listed before the learned Single Judge wherein it is prayed that an appropriate Arbitrator may be appointed as per the relevant dispute resolution clause in the agreement. During the course of hearing of the said matter before the learned Single Judge, the respondents have raised an objection as to maintainability of the application under Section 11(6) of the Act of 1996 on the ground that the provisions of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983 (Adhiniyam of 1983) are applicable for the dispute between the parties and; therefore, matter has to be referred to the Tribunal constituted under the Adhiniyam of 1983.

Finding of the Court:

Any agreement by whatever name called, if it falls within the meaning and definition of "works contract" as defined under Section 2(I) of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 has to be referred for adjudication before the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym. In view of statutory provisions of Section 7 of the Adhiniyam of 1983, the matter has to be referred to the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym, even in cases where the parties have incorporated a clause in agreement regarding resolution of dispute by some other forum or under the Arbitration and Conciliation Act, 1996. The view taken by the Division Bench in Ashoka Infraways Ltd. relying on Jabalpur Corridor (India) Pvt. Ltd. is correct. The substituted definition of work contract in the M.P. Madhyastham Adhikaran Adhiniyam, 1983 by Act No.7 of 2017 is clarifactory and is applicable to the pending or future contracts. The words "claim of ascertained money" have a definite connotation and therefore only such difference arising out of execution or non-execution of a 'works contract' which are related with claims of above nature will be covered under Section 2(d) of the Adhiniyam of 1983.

Issues: Whether, any agreement by whatever name called, if it falls within the meaning and definition of work contract as defined under Section 2(I) of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 has to be referred for adjudication before the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym? Whether, in view of statutory provisions of Section 7 of the Adhiniyam of 1983, the matter has to be referred to the M.P. Arbitration Tribunal constituted under Section 3 of the 1983 Adhiniym, even in cases where the parties have incorporated a clause in agreement regarding resolution of dispute by some other forum or under the Arbitration and Conciliation Act, 1996? Which of the views taken by the Division Bench of Ashoka Infraways Ltd. is correct relying on Jabalpur Corridor (India) Pvt. Ltd. ? Whether, the substituted definition of work contract in the M.P. Madhyastham Adhikaran Adhiniyam, 1983 by Act No.7 of 2017 is clarifactory and is applicable to the pending or future contracts? Any other ancillary issues arising out of the reference order.

Ratio Decidendi: The definition of "works contract" as defined under Section 2(I) of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 is wide enough to include the concession agreement if it fulfils the necessary ingredients of a works contract. The amendment in the definition of "works contract" is clarificatory in nature and is applicable to pending and future contracts. The words "claim of ascertained money" have a definite connotation and therefore only such difference arising out of execution or non-execution of a 'works contract' which are related with claims of above nature will be covered under Section 2(d) of the Adhiniyam of 1983.

Final Decision: The reference is decided accordingly.