Madhya Pradesh High Court
Rajesh Agrawal vs Executive Engineer Public Works ... on 8 February, 2016
1
A.C. No.9/2013
8.2.2016
Shri Shekhar Sharma, learned counsel for the applicant.
Shri R.K. Mangal, learned counsel for the respondent.
Heard finally with consent.
This application under Section 11(5) & (6) of the Arbitration and Conciliation Act, 1996 has been filed for appointment of independent arbitrator to resolve the dispute between the parties.
The case of the applicant is that an agreement was entered into on 4.11.2010 between the parties for the work of construction of Simrol-Udainagar road and the contract amount was Rs.495 Lacs. The work was intermittently stopped due to objection by the forest department and vide communication dated 5.3.2013 the contract was terminated. The applicant had approached the Superintending Engineer in terms of Clause 29 of the contract agreement and appeal was rejected on 2.7.2013. Thereafter the applicant had served the notice dated 28.9.2013 for appointment of arbitrator and has approached this Court by way of the present application.
The respondents have filed their reply raising an objection that the applicant is required to approach the Madhyastham Tribunal constituted under the provisions of M.P. Madhyastham Adhikaran Adhiniyam, 1983.
Learned counsel appearing for the applicant submits that since the applicant is not claiming any ascertained sum of money, therefore, he is not required to approach the Arbitration Tribunal.
Learned counsel for the respondents has opposed the prayer.
2Having heard the learned counsel for the parties and on perusal of the record, it is noticed that in Paragraph 4.9 of the application, the applicant has specifically pleaded that he is not raising dispute of any ascertained money amounting to Rs.50,000/- or more. In the notice dated 28.9.2013 (Annexure A/9), the applicant had demanded the arbitration against the termination of contract on 5.3.2013, without raising any dispute about ascertained sum of money. Before this Court also counsel for the applicant has made a categorical statement at the Bar that the applicant wants to challenge the order of termination and he will be restricting the monetary claim below Rs.50,000/-.
In terms of the Section 7 of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 (for short "Madhyastham Act") a party to the works contract has remedy of referring the dispute to the tribunal and such a dispute is required to be decided in terms of the provisions contained in the Act. The dispute has been defined under Section 2(d) of the Act as under:-
2(d). "dispute" means claim of ascertained money valued at Rupees 50,000 or more relating to any difference arising out of the execution or non-execution of a works contract or part thereof."
If the condition specified in Section 2(d) are not satisfied, then the matter cannot be referred for arbitration under the Madhyastham Adhiniyam.
Similar controversy has been examined by the Principal Seat in the matter of M.P. Housing Board Vs. Satish Kumar Raizada in M.A. No.1030/99 vide order dated 16.2.2010 when learned Single Judge in the Principal Seat taking note of the 3 earlier judgments on the point has held as under:-
"14. The expression "ascertained money"
which we are concerned within the case at hand in its plain dictionary meaning would mean "known"
"made certain". In Black's Law Dictionary fourth edition the expression "ascertain" is defined as "to fix; to render certain or definite; to estimate and determine; to clear of doubt or obscurity."
15. In the case at hand the question for determination would be whether these dispute would satisfy the test that the claim is for "ascertained money". Going back to the claim, in the case at hand, it was for;
(a) excess quantities of excavation in hard rock and its rates.
(b) payment of rigid conduit pipe and its rate; and
(c) payment of water charges with lead and its rate.
16. Thus the claim was not for any 'known' amount but for fixing the rate so that the definite amount can be known. In view of this it cannot be said that the claim by the contractor was for "ascertained money" as would have given the jurisdiction to the Tribunal to adjudicate the matter.
17. Division Bench of this Court in M/s Progressive Constructions (Pvt.) Ltd. Vs. Madhya Pradesh Electricity Board, Jabalpur : Civil Revision No.136 of 1998 decided on 24.6.1996, was pleased to observe in respect of the scope of Adhiniyam, 1983 and the jurisdiction of the Tribunal in the following terms:-
"11. The Adhiniyam is a special enactment enacted with an object as is clear from its preamble, that is, an Act to provide for the establishment of a Tribunal to arbitrate in disputes to which the State Government or a Public Undertaking wholly or substantially owned or controlled by the State Government is a party and for matter incidental thereto or connected therewith. Section 2 of the Chapter I is a 4 Definition Clause. For the purpose of this revision definition of 'dispute' as defined in section 2(1)(d) of the Adhiniyam is relevant which means claim of ascertained money valued at Rupees 50,000/- or more relating to any difference arising out of the execution or non-execution of a works contract or part thereof. Chapter II deals with the constitution of the Tribunal. Chapter (I) contains section 7 to 15 which deals with commencement of proceedings before Tribunal and procedure of Tribunal. Chapter IV deals with the award and orders of the Tribunal and its Benches embarrassing Section 16 to 18. In Chapter IV section 17-A and 17-B where inserted by M.P. Act No.9 of 1990 whereas from 29-4-90 Section 17-A deals with inherent powers of the Tribunal and section 17-B deals with correction of clerical or arithmetical mistakes. Chapter V deals with the High Court powers of Revision as provided in section 19 of the Adhiniyam. Chapter VI miscellaneous provisions have been made which are contained in section 20 to 31.
16. The jurisdiction of the Tribunal can only be invoked on a dispute as defined in section 2(1)(d) of the Adhiniyam arising out of works contract by making a reference to the Tribunal under section 7 of the Adhiniyam]..."
18. Similarly, in M.P. Housing Board, Bhopal vs. Satish Kumar Raizada : 2003 (2) MPLJ 346 it was observed in respect of the aspect as to whether the dispute could be adjudicated by the M.P. Arbitration Tribunal even in respect of unascertained money:-
"The word "dispute" is defined in section 2(1)(d) of the M.P. Arbitration Tribunal Act, 1983 and the Tribunal 5 constituted under this Act can decide under section 7 of the Act such disputes only which are covered by this definition. The "dispute" under this definition must be for "ascertained money". It means the sum which is "known" or "made certain" or "fixed" or "determined" or "quantified". In this case the reference of the dispute before the Deputy Housing Commissioner was to fix the rates of the works already done by the contractor. His claim was not for any ascertained sum of money. Therefore, it could not be submitted before the Arbitration Tribunal for its decision. It has been held by a Division Bench of this Court in Progressive Constructions Private Ltd. Vs. M.P. State Electricity Board (C.R. No.136 of 1988 decided on 24-6-1996) that the jurisdiction of the Tribunal can only be invoked on a "dispute" as defined in section 2(1)(d) of the Act by making a reference to the Tribunal under section 7 of the Act. Therefore, it follows that the Tribunal could not entertain claim for fixation of rates and by the "arbitration agreement" between the parties this work has been assigned to the authority named therein."
19. In view of the above this Court does not find any discrepancy in the approach of Court below in rejecting the objections raised by the appellant as to the jurisdiction of the Arbitrator appointed under the Act of 1940 to adjudicate upon the dispute regarding unascertained money which cropped up between the appellant and the respondent. No other points have been urged by the appellants."
Since in the present case the applicant is not raising dispute relating to the claim of ascertained money valued at 6 Rs.50,000/- or more, hence the matter cannot be referred under Section 7 to the Madhyastham Tribunal. Counsel for both the parties have referred to various judgments in support of their respective plea; whether it is a works contract or not, but those judgments are not relevant and this Court need not go into that aspect of the matter since even if the contract is held to be a works contract but since the dispute itself is not covered under Section 2(d), hence it is not arbitrable under the Madhyastham Act.
Thus, I am of the opinion that the applicant has rightly approached this Court under the Arbitration and Conciliation Act, 1996. The arbitration agreement is also not in dispute.
In the aforesaid circumstances, the provisions of the Arbitration and Conciliation Act, 1996 are clearly attracted in the matter, therefore, considering the dispute between the parties, I am of the opinion that an independent Arbitration is required to be appointed to resolve the same.
Hence I propose to appoint Shri S.N. Sharma, Retd. District Judge to be the learned Arbitrator for resolving the dispute. Let the declaration in terms of amended Section 12 in the prescribed form as contained in the 6 th Schedule of the Act be obtained from the proposed Arbitrator by the Principal Registrar of this Court within three weeks.
List on 4.4.2016.
C.C. as per rules.
(Prakash Shrivastava) Judge trilok