Madhya Pradesh High Court
Yogi Edutransit Private Ltd. vs The State Of Madhya Pradesh on 15 April, 2026
NEUTRAL CITATION NO. 2026:MPHC-JBP:28898
1 AC-4-2025
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VIVEK JAIN
ON THE 15th OF APRIL, 2026
ARBITRATION CASE No. 4 of 2025
YOGI EDUTRANSIT PRIVATE LTD.
Versus
THE STATE OF MADHYA PRADESH AND OTHERS
Appearance:
Shri Soumil Ekadi - Advocate for the petitioner through VC.
Ms. Shanti Tiwari - P.L. for the State.
Shri Bhavishya Sharma - Advocate for the respondent Nos.2 & 3
through VC.
ORDER
The present application has been filed under Section 11(6) Arbitration and Conciliation Act, 1996 for appointment of Arbitrator to adjudicate upon the disputes arising between the parties emanating from agreement for Transportation Services for Pravasi Bhartiya Diwas, 2023 .
2. Counsel for the petitioner has argued that various claims are outstanding to be paid by the respondent Nos.2 and 3 to the petitioner and there is arbitration clause in the agreement.
3. The aforesaid is countered by learned counsel for the respondent Nos.2 & 3 on the ground that there is pre-arbitration settlement clause, which has not been adhered to by the petitioner and therefore, Arbitrator cannot be appointed.
Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PMNEUTRAL CITATION NO. 2026:MPHC-JBP:28898 2 AC-4-2025
4. Upon considering the aforesaid rival submissions, it is seen that the arbitration clause in the agreement is as under:-
"2.11 Disputes Resolution'
(i) Amicable Settlement:
The parties shall use their best efforts to settle amicably all disputes arising out of or in connection with this Agreement or the interpretation thereof. In the event a dispute, differences or claim arises in connection with, the' interpretation or implementation of this Agreement, the aggrieved party shall issue a written notice setting out the Dispute/differences or claim to the other Party. Parties shall first attempt to resolve such:-dispute through mutual consultation. If the dispute is not resolved as aforesaid manner- within 15 days from the date of receipt of written notice, the matter will be referred for Arbitration.
(ii) Arbitration:
In case the dispute is not resolved, any party may: issue a notice of reference, invoking resolution of disputes through arbitration in accordance - with the provisions of the. Arbitration and Conciliation Act, 1996. The arbitral proceedings shall be conducted by a Sole Arbitrator that may be appointed with the consent of Parties to such dispute. If there is no agreement among the Parties to the identity or appointment of such Sole Arbitrator within 30 days of issue of notice of reference, then the arbitral "
proceedings will be conducted by a panel of three arbitrators, one arbitrator to be appointed by MPSTDC and other appointed by Transport Operator and the third arbitrator to be mutually appointed by the other two arbitrators in accordance with provisions of Arbitration and Conciliation Act, 1996. Arbitration proceedings shall be conducted at Bhopal and following are agreed:
When any dispute is under arbitration, except for matters under dispute, the: Parties shall continue to exercise their remaining Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PM NEUTRAL CITATION NO. 2026:MPHC-JBP:28898 3 AC-4-2025 respective rights and fulfil . their remaining respective obligations under this Agreement;
The arbitration arbitrator award shall be final and binding on the Parties;
The arbitrator may award to the Party that substantially prevails on merit, its costs and reasonable expenses (including reasonable fees for Counsel);
The award shall be made in English language."
5. In terms of Clause 2.11(i), there is a provision for amicable settlement. The petitioner indeed had issued a notice for amicable settlement Annexure P-6 dated 04.11.2024, in which there is a clear request for amicable settlement, but the said notice has not been replied by the respondents and there is no assertion in the reply that the said notice was not received by the respondents No.2 & 3.
6. The rival pleadings do indicate that there is serious disputes between the parties and the petitioner having requested the respondents for pre-arbitration settlement, is also established.
7. Section 77 only prohibits the parties from initiating any arbitral or judicial proceedings during pendency of conciliation proceedings. The Hon'ble Supreme Court in the case of Demerara Distilleries Private Limited v. Demerara Distilleries Limited, (2015) 13 SCC 610 has held that any clause providing resolution of disputes by mutual discussions and mediation, etc., would be empty formality once there are serious disputes arising between the parties. It has been held that once a dispute has arisen between the parties, then it is difficult to hold that arbitration clause is not invocable. In Intercontinental Hotels Group (India) (P) Ltd. v. Waterline Hotels (P) Ltd., Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PM NEUTRAL CITATION NO. 2026:MPHC-JBP:28898 4 AC-4-2025 (2022) 7 SCC 662, the Apex Court has held that "when in doubt, do refer". Further, it has been held by Delhi High Court in the case of Ravindra Kumar Verma v. BPTP Ltd., 2014 SCC OnLine Del 6602 as under :
"11. Whereas the existence of conciliation or mutual discussion should not be a bar in seeking to file proceedings for reference of the matter to arbitration and which is necessary for preserving rights as envisaged by Section 77 of the Act, however, since in many contracts there is an effective need of conciliation etc. in terms of the agreed procedure provided by the contract, the best course of action to be adopted is that existence of conciliation or mutual discussion procedure or similar other procedure though should not be held as a bar for dismissing of a petition which is filed under Sections 11 or 8 of the Act or for any legal proceeding required to be filed for preserving rights of the parties, however before formally starting effective arbitration proceedings parties should be directed to take up the agreed procedure for conciliation as provided in the agreed clause for mutual discussion/conciliation in a time bound reasonable period, and which if they fail the parties can thereafter be held entitled to proceed with the arbitration proceedings to determine their claims/rights etc.
12. In view of the above, though this petition is dismissed and the impugned order is sustained by which the application under Section 8 of the Act has been allowed, it is however directed that before arbitration proceedings are effectively pursued, parties must resort to mutual discussions within a time bound reasonable period. In case, mutual discussions or conciliation proceedings do not successfully conclude within the time bound reasonable period of say three months, thereafter arbitration proceedings for determination of the rights can be continued. I note that I am fixing a period in this case because contractually no period has been prescribed for mutual discussion/conciliation procedure. This petition is accordingly dismissed and disposed of subject however to the aforesaid observations with respect to mutual discussion/conciliation procedure."
8. Further in the case of Abhi Engg Corpn. (P) Ltd. v. NTPC Ltd., 2022 SCC OnLine Del 4956 it has been held by the Delhi High Court as under:-
"15. A reference has also been made to the decision of this Court in Kunwar Narayan v. Ms. Ozone Overseas Pvt. Ltd. in ARB.P. 538/2020 decided on 10th February, 2021, wherein a similar mechanism for resolution of disputes was provided. Reliance has also been place on Demarara Distilleries Pvt. Ltd. v. Demerara Distillers Ltd. (supra) and Ravindra Kumar Verma v. BPTP Ltd., 2014 SCC OnLine Del 6602, wherein it was observed that nothing worthwhile would be achieved by relegating the parties to explore any avenue of amicable Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PM NEUTRAL CITATION NO. 2026:MPHC-JBP:28898 5 AC-4-2025 resolution. Besides, the appointment of an Arbitrator by this Court would not act as an impediment to the parties to resolve their disputes amicably should it be possible at any point of time.
16. In the present case, considering the nature of dispute, it may be an empty formality as observed above, to relegate the parties to first explore the possibility of mutual consultation. Moreover, this cannot be considered as a ground to dismiss the present petition under Section 11(6) of A&CAct, 1996."
9. In the present case, there was no conciliation clause and admittedly a serious dispute arises between the parties, hence, relegating the parties for amicable settlement would be empty formality, because in the entire reply filed before this Court, it is not contended by the respondent that it is willing for amicable settlement. Even no reply to notice for amicable settlement was sent by the respondents No.2 and 3. Therefore, it is a fit case for appointment of Arbitrator.
10. Consequently, the application for appointment of Arbitrator is allowed. Shri Justice Achal Kumar Paliwal, Former Judge, Madhya Pradesh High Court is appointed as Sole Arbitrator to decide the controversies and disputes arising between the parties.
11. The Registrar (Judicial-1) of this Court shall obtain necessary disclosure and consent of the proposed Arbitrator within 10 days, but not later than 29.04.2026 and if consent and disclosure is not received, then the case shall be listed before the Court on 30.04.2026 under the caption "directions". If consent and disclosure is received by 29.04.2026, then the case shall be treated as disposed of.
12. The parties shall appear before the learned Arbitrator firstly on 04.05.2026, and on such further dates as may be directed by the learned Arbitrator thereafter.
Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PMNEUTRAL CITATION NO. 2026:MPHC-JBP:28898 6 AC-4-2025
13. The application stands disposed of.
(VIVEK JAIN) JUDGE rj Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 4/17/2026 6:10:42 PM