Madhya Pradesh High Court
Rami Infra Projects vs Dilip Buildcon Limited on 15 January, 2026
1 AC-37-2025
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
AC No. 37 of 2025
(RAMI INFRA PROJECTS Vs DILIP BUILDCON LIMITED )
Dated : 15-01-2026
Shri Somesh Shukla - Advocate for the petitioner.
Shri Shreyas Dubey - Advocate for the respondent.
The present petition has been filed for appointment of Arbitrator under Section 11(6) of Arbitration and Conciliation Act, 1996 (for short hereinafter referred to as "Act 1996").
2. An agreement was entered into between the parties and work order was issued for the work of 'Raised Profile Edge Line Road Marking' with material rates for the project REHABILITATION CONFIGURATION AND UPGRADING TO 2 LANE/2 LANE WITH PAVED SHOULDER CONFIGURATION AND STRENGTHENING OF PRATAPGARH - PADI FROM KM 80/0 TO KM 180/0 SECTION OF NH- 113 IN THE STATE OF RAJASTHAN UNDER PHASE - 1 OF NATIONAL HIGHWAY INTER CONNECTIVITY IMPROVEMENT PROJECT (NHIIP).
3. As per Clause 28 of the work order dated 12.06.2019, there is an arbitration clause in the following terms:-
"28. In Case of dispute arising in execution of work under this work order & related payments, the same will amicably settled between both the parties or else will be resolved as per the Indian Arbitration & Conciliation Act 1996. For all legal matters relating to and arising out of this work order, the jurisdiction shall be the Civil Court at Bhopal, Madhya Pradesh. The obligation of the Sub-Contractor to execute the works shall prevail during the Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 1/16/2026 11:57:53 AM 2 AC-37-2025 course of the arbitration proceedings, unless the Authority / Contractor has given any specific instruction for stoppage of the work."
4. During execution of the work, certain disputes arose between the parties and the petitioner issued a notice Annexure A-7 dated 21.11.2023 to the respondents intimating therein that there is a claim of Rs.41.33 lakh, which is due to be paid to the petitioner by the respondent No.1, and he demanded the said amount.
5. The present petition for appointment of Arbitrator is being defended by the respondents by placing heavy reliance on their reply to this notice, which is Annexure A-8 dated 23.12.2023 to contend that the petitioner has not complied the mandatory prior process before seeking appointment of Arbitrators. It is argued before this Court that by paragraph 5(e) of the said reply Annexure A-8, it had been conveyed to the petitioner that there is a procedure for amicable settlement and the petitioner may contact the authorized representative of respondent No.1 for amicably resolving the said issues between the parties. It is being argued before this Court that since the petitioner did not approach the respondent No.1 for amicable settlement, therefore, in view of the language of the arbitration clause, for the petitioner not approaching respondent No.1 for amicable settlement, the application for appointment of Arbitrator is premature.
6. The aforesaid reply to notice Annexure A-8 is not an unqualified reply stating that the respondent No.1 is willing to look into the grievances of the petitioner and for that purpose he may approach the authorized representative. In the said notice, there was a categorical denial of the demand made by the petitioner, by stating in paragraph 3 and paragraph 5(e) Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 1/16/2026 11:57:53 AM 3 AC-37-2025 in the following terms:-
"3. That my Clients also instructs me to state that my Clients are not liable to pay any amounts to your client as the total amount pertaining to the past transactions between your client and my Client No. 1 (DBL), has already been paid in full by DBL and the same was duly accepted by your client. Therefore, the demand is based on completely baseless and frivolous grounds and has been raised for the purpose of initiating a frivolous legal proceeding against my Clients.
5(e). Thus from the records available, my Client is not liable to pay any outstanding amounts to your Client against the work carried out by them at the project site of my Client, However my client has instructed me to convey it your client that as per the terms of the Work Order any dispute in relation to the Work Order/ or payments to be made thereof were to be resolved amicably, therefore my Client instructs me to convey it to you and your Client that if any dispute with regard to the payments of work done still persists, your Client is requested to kindly contact the Authorized Representative of my Client no. 1, for amicably resolving the said issues between the Parties (if any)."
7. This notice was being issued on behalf of Directors of the respondent No.1 - company and once in the reply being submitted on behalf of Directors of the company containing categorical denial of any liability, then asking the petitioner to approach the authorized representative was in fact not a real offer to look into the grievances and not an offer for amicable settlement at all because there was already a clear cut denial.
8. The petitioner thereafter issued a notice Annexure A-11 under Section 21 of Act of 1996 invoking arbitration clause which is dated 13.12.2024 and in the said notice the arbitration clause was invoked and the petitioner sought appointment of Arbitrator.
9. The said notice was replied vide Annexure A-12 dated 28.12.2024 and in this reply to notice for appointment of Arbitrator there was no offer Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 1/16/2026 11:57:53 AM 4 AC-37-2025 for amicable settlement, neither any offer to contact the authorized representative, but there was a clear cut and unconditional denial of claim of petitioner and refusal to resort to arbitration process point. Paragraphs 3 & 6 of the said reply are as under:-
"3. That my Client also instructs re to state that my Client has time and again informed your Client that they are not liable to pay any amounts to your client as the total amount pertaining to the past transactions between your client and my Client, has already been paid in full by my Client, and the same was duly accepted ty your client, Therefore, the demand is based on completely baseless and frivolous grounds and has been raised for the purpose of initiating frivolous legal proceedings against my Client.
6. Further with regard to the your Notice dated 13.12.2024, for invocation of arbitration proceedings and appointment of Arbitrator, my Client instructs me to state that as there is no financial obligation or nonpayment of any dues in lieu of the demands raised by your Client, therefore my Client firmly believe that the demands raised by your Client do not constitute a 'dispute as required for the initiation of arbitration proceedings under the applicable contractual terms."
10. As there was a categorical denial of liability and denial to resort to arbitration process without giving any offer to approach the respondents for amicable settlement, therefore the objection that the petitioner has not resorted to amicable settlement, is misconceived and is hereby discarded.
11. As there is a dispute between the parties, whereby one party stakes some claim which is being denied by the other party, therefore, there is an arbitrable dispute. Consequently, this present application under Section 11(6) deserves to be allowed and arbitrator needs to be appointed.
12. This Court, therefore, proposes to appoint Shri Justice Ved Prakash Sharma, Former Judge, Madhya Pradesh High Court, 9-D, Orchard Residency, B-Block, Palace Orchard, Kolar Road, Bhopal (MP) Mobile:
94251-15150, as sole Arbitrator to decide the disputes arising between the Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 1/16/2026 11:57:53 AM 5 AC-37-2025 parties.
13. Let Registrar (J-I) of this Court obtain consent and disclosure of the proposed Arbitrator in accordance with law.
14. List on 28.01.2026 for further orders.
(VIVEK JAIN) JUDGE rj Signature Not Verified Signed by: RAJESH KUMAR JYOTISHI Signing time: 1/16/2026 11:57:53 AM