M.P. Housing and Infrastructure Development Board & Anr. vs K.P. Dwivedi

HELD: 1. The case of the respondent – contractor that the earlier order passed by the High Court dated 20.08.2008 passed in Writ Petition No.9131 of 2008, referring the dispute between the parties for adjudication to the Arbitrator – Housing Commissioner and thereafter the award declared by the Arbitrator – Housing Commissioner dated 07.11.2008 are non-est and void and therefore, it was open for the contractor to file a fresh reference petition before the Arbitral Tribunal under Section 7 of the 1983 Act, cannot be accepted for the following reasons: (i) It was the respondent – contractor who approached the High Court by filing Writ Petition No.9131 of 2008 submitting that he has invoked the arbitration clause; (ii) The order passed by the High Court dated 20.08.2008 passed in Writ Petition No.9131 of 2008 referring the dispute between the parties to the Arbitrator – Housing Commissioner was a consent order; (iii) Thereafter the respondent – contractor submitted the claims before the learned Arbitrator – Housing Commissioner; (iv) The learned Arbitrator – Housing Commissioner passed an award which has attained the finality; (v) That the review petition filed by the contractor for clarification of the order dated 20.08.2008 passed in Writ Petition No.9131 of 2008 to clarify the aforesaid order to the extent that it did not take away the right of the contractor to file the reference petition before the Arbitral Tribunal under the 1983 Act came to be rejected and the same also attained finality;

(vi) The claims submitted before the Arbitrator – Housing Commissioner; before the High Court in Writ Petition No.9131 of 2008; and the claim submitted in Reference Petition before the Arbitral Tribunal under the 1983 Act are the same without any change; (vii) In the subsequent reference petition before the Arbitral Tribunal under the 1983 Act there was no reference to the earlier order passed by the High Court in Writ Petition No.9131 of 2008 referring the dispute between the parties for adjudication to Arbitrator – Housing Commissioner and the award passed by the Arbitrator – Housing Commissioner. Thus, there was a suppression on the part of the respondent – contractor;

(viii) The order passed by the High Court dated 20.08.2008 passed in Writ Petition No.9131 of 2008 referring the dispute between the parties for adjudication to the Arbitrator – Housing Commissioner as such was a consent order and thereafter the contractor participated in the arbitration proceedings before the Arbitrator – Housing Commissioner by submitting the claim is binding between the parties on the ground of ‘issue estoppel’. [Para 14][1101-G-H; 1102-A-H; 1103-A]

2. Apart from the fact that the award declared by the Arbitrator – Housing Commissioner was not challenged by the respondent – contractor, even, so long as the said award is not challenged before the higher forum the same is binding between the parties. Even the award or a nullity order has to be challenged before the appropriate forum/higher forum. In the present case it cannot be said that there was a total lack of jurisdiction of the Arbitrator – Housing Commissioner in passing the award as it was the High Court who passed the order with consent referring the dispute between the parties for the adjudication to the Arbitrator – Housing Commissioner. Therefore, unless and until it was challenged by the contractor before the higher forum, the respondent – contractor cannot be permitted to ignore and/or to avoid the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008. [Para 16][1103-C-E]

3. Even otherwise, it is required to be noted that what was filed before the High Court was the revision application filed by the contractor under Section 19 of the 1983 Act rejecting the reference petition as not maintainable. Therefore, as per Section

19 of the 1983 Act, Revision Application to the High Court shall be maintainable only against the award passed by the Arbitral Tribunal. Therefore, prima facie it appears that as such the order passed by the Arbitral Tribunal rejecting the reference petition was not maintainable as by order dated 27.02.2017, no award was passed by the Tribunal. However, as no such objection was raised before the High Court and no submission has been made by the parties, we rest the matter there. [Para 17][1103-E-F; 1104-E-G]

4. Even otherwise it is required to be noted that while passing the impugned judgment and order, the High Court has not set aside the award passed by the Arbitrator - Housing Commissioner dated 07.11.2008. Therefore, technically speaking the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008 stands even today. It is binding between the parties. So long as the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008 stands, there cannot be any subsequent fresh proceeding with respect to the same claims which were considered and adjudicated by the Arbitrator – Housing Commissioner while passing the award dated 07.11.2008. So long as the said award stands it is binding between the parties. [Para 18][1104-G-H; 1105-A-B]

5. Even otherwise it is required to be noted that no objection was raised by the respondent – contractor before the Arbitrator – Housing Commissioner on the jurisdiction of the Housing Commissioner to act as an Arbitrator. On the contrary, the order passed by the High Court referring the dispute between the parties for adjudication to the Arbitrator – Housing Commissioner was a consent order and the respondent contractor conceded to and accepted the said order and submitted his claim before the Arbitrator – Housing Commissioner. The Arbitrator – Housing Commissioner also passed an award on the said claim. Therefore, as no objections were raised by the respondent – contractor at the appropriate stage, the award cannot be annulled subsequently. At the cost of repetition, it is observed that at no point of time the respondent – contractor had challenged the award passed by the Arbitrator - Housing Commissioner and even no court has set aside the award declared by the Arbitrator – Housing Commissioner dated 07.11.2008 and the same has attained finality. Therefore, the same is binding between the parties. Hence, the subsequent fresh reference petition before the Arbitral Tribunal under the 1983 Act for the very same claims which were raised before the Arbitrator – Housing Commissioner would not be maintainable at all. This Court agrees with the view taken by the Arbitral Tribunal. [Para 19][1105-B-F]

Madhya Pradesh Rural Road Development Authority and Another vs. L.G. Chaudhary Engineers and Contractors, (2018) 10 SCC 826 : 2018 (5) SCALE 103; Hope Plantations Ltd. vs Taluk Land Board, Peermade and Another, (1999) 5 SCC 590 : [1998] 2 Suppl. SCR 514; Bhanu Kumar Jain vs Archana Kumar and Another, (2005)1 SCC 787 : [2004] 6 Suppl. SCR 1104; Pushpa Devi Bhagat (D) Th. LR. Sadhna Rai (Smt.) vs. Rajinder Singh & Ors., (2006) 5 SCC 566 : [2006] 3 Suppl. SCR 370; Rafique Bibi (Dead) By Lrs. vs. Sayed Waliuddin (Dead) by LRs and others, (2004)

1 SCC 287 : [2003] 3 Suppl. SCR 100; M.P.Road Development Authority and Anr. vs. L.G. Chaudhary Engineers & Contractors reported in (2012) 3 SCC 495 : [ 2012] 2 SCR 162; M.P. Rural Road Development Authority and Anr. vs. L.G. Chaudhary Engineers & Contractors reported in (2018) 10 SCC 826: 2018 (5 ) SCALE 103; Viva Highways Ltd. vs. MP Rural Road Development Corporation Ltd. I.A.No.14 of 2017 decided by the Full Bench of Madhya Pradesh High Court; M/s Essel Infra Projects Ltd. vs. The State of MP in Civil Appeal No.4250 of 2018 decided by the Supreme Court of India; Hindustan Zinc Ltd. vs. Ajmer Vidyut Vitran Nigam Ltd., (2019) 17 SCC 82: [2019]

15 SCR 113 – referred to.