An arbitral award cannot be annulled solely on jurisdictional grounds not raised during earlier proceedings, as failure to object constitutes a waiver of rights.

JUDGMENT

J.B. PARDIWALA, J.:

For the convenience of the exposition, this judgment is divided in the following parts: -

1. Leave Granted.

2. This appeal arises from the judgment and order passed by the High Court of Madhya Pradesh, Principal Seat at Jabalpur dated 07.01.2022 in Arbitration Appeal No. 79 of 2021 by which the appeal filed by the appellant herein under Section 37 of the Arbitration and Conciliation Act, 1996 (for short, the “Act, 1996”) came to be dismissed thereby affirming the order dated 20.12.2019 passed by the Commercial Court and 19th Additional Sessions Judge, Bhopal (M.P.) allowing application filed by the respondent herein under Section 34 of the Act, 1996.

3. It appears that the respondent herein suffered an award dated 08.07.2011 passed by the Arbitral Tribunal (for short, the “Tribunal”). The said award was challenged by the respondent Corporation under Section 34 of the Act, 1996. The appeal filed by the Corporation under Section 34 of the Act, 1996 came to be allowed on the ground that the Tribunal had no jurisdiction to pass the award in view of the provisions of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 (for short, the “MP Act, 1983”). The order passed by the Commercial Court and 19th Additional Sessions Judge, Bhopal (M.P.) came to be challenged by way of appeal before the High Court under Section 37 of the Act, 1996. The appeal came to be dismissed.

A. FACTUAL MATRIX

4. The facts giving rise to this appeal may be summarised as under:-

(i) The appellant executed a “works contract” dated 12.12.2005 with the respondent for “Rehabilitation and Strengthening of Khargone - Barwani Road (SH-26) Project Road No. 19” & “Rehabilitation and Strengthening of Khargone - Bistan Road (SH-31) Project Road No. 20” in the State of Madhya Pradesh. Clause 67.3 of the “General Conditions of Contract” read with Clause 67.4 of the “Conditions of Particular Application” provided for arbitration as the means for resolution of disputes between the Parties.

(ii) The arbitration agreement mandated that the tribunal shall comprise of three members, one to be appointed by each party and the two co- arbitrators had to nominate the presiding arbitrator.

(iii) Clause 67.4 of the Conditions of Particular Application – Part-II reads thus: -

“Sub-Clause 67.4 : Arbitration Any dispute in respect of which:

a) the decision, if any, of the Board has not become final and binding pursuant to Sub-Clause 67.2, and

b) amicable settlement has not been reached:

(i) In the case of dispute arising between the Employer and a domestic Contractor or between the Employer and a foreign Contractor who opts for the application of the Indian Arbitration and Conciliation Act, 1996 related to any matter arising out of or connected with this Contract, such dispute shall be referred to the award of two Arbitrators (one each to be appointed by each party) and an Umpire to be appointed by the Arbitrators, or if there is no agreement, to be appointed by the Arbitration Committee of the Indian Council of Arbitration. The Indian Arbitration and Conciliation Act, 1996 , the rules there under and any statutory modification or re-enactment thereof, shall apply to these arbitration proceedings; or (2) in the case of dispute arising between the Employer and a foreign Contractor, by application of the UNCITRAL Arbitration Rules related to any matter arising out of or connected with this Contract, such dispute shaft be referred to the award of two Arbitrators (one each to be appoin