[ad_1]
Supreme Court – Daily Orders
M/S Sew Infrastructure Ltd vs The Government Of Chhattisgarh on 7 May, 2025
Author: Pamidighantam Sri Narasimha
Bench: Pamidighantam Sri Narasimha
1
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. /2025
[@ SLP(C) No.23741/2024]
M/S SEW INFRASTRUCTURE LTD. Appellant(s)
VERSUS
THE GOVERNMENT OF CHHATTISGARH Respondent(s)
O R D E R
1. Leave granted.
2. This appeal is against the judgment and order passed by
the High Court of Chhattisgarh at Bilaspur in Writ Petition
Civil No. 1142/2019 dated 05-08-2024.
3. The appellant before us, a corporate entity, entered into
an agreement with the State of Chhattisgarh on 20.12.2007 for
construction of concrete dam(s) and allied work. As disputes
arose during the course of execution of the contract, in view
of the arbitration clause in the agreement, the appellant
sought adjudication and determination of the disputes through
arbitration under the Arbitration and Conciliation Act, 1996 1.
4. Sole arbitrator came to be appointed on 05.11.2015. The
arbitral proceedings culminated in the passing of the award on
Signature Not Verified
Digitally signed by
INDU MARWAH
Date: 2025.05.17
30.03.2017. It is not in dispute that before the Arbitral
15:44:31 IST
Reason:
Tribunal the respondent-State had not taken any objection
1
Hereinafter referred to as the ‘Act’.
2
about the applicability of the Chhattisgarh Madhyastham
Adhikaran Adhiniyam, 1983, (hereinafter referred to as the
‘State Act’).
5. However, when the State challenged the award on
jurisdictional ground under Section 34 of the Act, that the
State Act alone applies, the Commercial Court by its order
dated 05.12.2018 accepted the submissions and set aside the
award. For this purpose, the Commercial Court relied on the
decision in Lion Engineering Consultants v. State of Madhya
Pradesh and Ors2 that a ground of jurisdiction can be raised
at any stage.
6. Questioning the correctness of the decision of the
Commercial Court, the appellant filed a writ petition under
Article 226, which came to be dismissed by the High Court by
the order impugned before us on the ground of alternative
remedy under Section 37 of the Act.
7. In the order impugned, the High Court held as under:
“16. In the case at hand, the Commercial Court
while exercising the Jurisdiction under Section 34
of the Act of 1996 has allowed the application
under Section 34 of the Act of 1996 for the reasons
assigned therein. The Court in an appeal under
Section 37 of the Act of 1996 can very well confirm
the award of arbitration, set aside the order
passed under Section 34 or reject the application
under, Section 34 or appeal under Section 37.
17. In the case at hand, as per case of petitioner,
2
(2018) 16 SCC 758
3the Sole Arbitrator passed an award in its form and
it is the respondent who approached the Commercial
Court by filing proceeding under Section 34 of the
Act of 1996 and therefore, the grounds on which
this petition is filed can very well be considered
by the Court in an appeal under Section 37 of the
Act of 1996.
18. For the foregoing discussion, in the facts of
the case and decisions of Hon’ble Supreme Court in
case of Whirlpool Corporation (supra), Nivedita
Sharma (supra), Harbanslal Sinha (supra) and
Commercial Steel Limited (supra), in the opinion of
this Court, writ petition is not maintainable as
the petitioner is having efficacious alternate
remedy of appeal under Section 37 of the Act of
1996.
19. Accordingly, writ petition is liable to be and
is hereby dismissed, reserving liberty with the
petitioner to avail the remedy available, in
accordance with law.”
8. Mr. Harsh Parashar, learned advocate appearing for the
appellant submitted that the respondent-State has never
objected to the jurisdiction of the arbitrator in view of the
State Act. On the other hand, Mr. Karan Khetnai has submitted
that the jurisdictional question can be taken up at any stage.
9. We have been encountering cases where the States such as
Madhya Pradesh and Chhattisgarh, governed by special State
legislations for resolution of disputes through arbitration
are taking contradictory and inconsistent stands. It is under
these circumstances that this Court passed orders in M.P.
Rural Road Development Authority v. L.G. Chaudhary Engineers &
Contractors3, JMC Projects (India) Ltd. v. Madhya Pradesh
3
(2018) 10 SCC 826
4
Road Development Corporation4 and Sweta Construction v.
Chhattisgarh State Power Generation Company Ltd.5 It is
unfortunate that the State of Madhya Pradesh and Chhattisgarh
have contributed to unnecessary litigation. Issues relating to
jurisdiction must be taken at the earliest and this has two
important values to sub-serve. To start with, there must be
clarity and certainty about the existence or non-existence of
a statutory remedy for resolution of disputes. Secondly,
jurisdictional issues, if not taken at the earliest lead to
prolonged and unnecessary litigation, having a direct bearing
on time and expense. The State Governments must take immediate
action and issue necessary instructions about the invocation
of the State Acts at the earliest, whenever the State or the
contractor seeks arbitration under contracts with the State or
their instrumentalities.
10. Returning to the facts of the present case, we have a
precedent to follow. In similar circumstances, in L.G.
Chaudhary (supra) this Court adopted the following mode.
“17. We do not express any opinion on the
applicability of the State Act where award has
already been made. In such cases if no objection
to the jurisdiction of the arbitration was taken
at relevant stage, the award may not be annulled
only on that ground.
18. The appeals are, accordingly, disposed of.
4
(2024) 4 SCC 729
5
(2024) 4 SCC 722
5
CA No. 2616 arising out of SLP (C) No. 35641 of
2011
19. Leave granted. In view of the order [ Set out
in paras 15 to 18, above.] passed in CA No. 2751
of 2018 arising out of SLP (C) No. 16615 of 2012,
no objection having been raised by the
respondents in terms of Section 16(2) of the
Arbitration and Conciliation Act, 1996 at
appropriate stage within the time stipulated, the
award could not have been annulled.
20. Accordingly, this appeal is allowed, the
impugned judgment [Sarvesh Rai v. M.P. Rural Road
Development Authority, Misc. Appeal No. 2673 of
2006, order dated 17-8-2011 (MP)] is set aside
and the award is restored. It is, however, made
clear that this order will not debar proceedings
under Section 34 of the Arbitration and
Conciliation Act, 1996.”
11. A similar approach was adopted by this Court again in JMC
Projects (India) Ltd. v. Madhya Pradesh Road Development
Corporation and also in Sweta Construction v. Chhattisgarh
State Power Generation Company Ltd.
12. The present appeal arises out of an order of the High
Court dismissing the writ petition under Article 226 of the
Constitution and directing the appellant to avail the
alternative remedy of filing an appeal under Section 37 of the
Act. It is important to note that the decision of the
Commercial Court under Section 34 dated 05.12.2018 is only on
jurisdictional question and there was no occasion for the
Commercial Court to decide the case on merits. Following the
approach adopted by this Court in the above referred
6
precedents, it will be appropriate to restore Section 34
petition and enable the parties to contest or defend the award
on merits. This approach would enable the State to have the
opportunity to contest the award on merits, which it never had
and will also enable the appellant to defend the award on its
own merits.
13. In conclusion, while we uphold the decision of the High
Court that the appellant must exercise the alternative remedy
under the Arbitration and Conciliation Act, in exercise of our
jurisdiction under Article 142, we set aside the judgment and
order passed by the Commercial Court dated 05.12.2018 and
restore Section 34 petition in M.J.C. No 16-17 to its original
number and direct the Commercial Court to hear both the
parties on merits and decide the case as expeditiously as
possible.
14. With the above observations, the Civil Appeal stands
disposed of.
..……………………J.
[PAMIDIGHANTAM SRI NARASIMHA]
..……………………J.
[JOYMALYA BAGCHI]
New Delhi
07-05-2025
ITEM NO.27 COURT NO.11 SECTION IV-C
7
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Petition(s) for Special Leave to Appeal (C) No(s). 23741/2024
[Arising out of impugned final judgment and order dated 05-08-2024
in WPC No. 1142/2019 passed by the High Court of Chhattisgarh at
Bilaspur]
M/S SEW INFRASTRUCTURE LTD. Petitioner(s)
VERSUS
THE GOVERNMENT OF CHHATTISGARH Respondent(s)
Date : 07-05-2025 This petition was called on for hearing today.
CORAM : HON’BLE MR. JUSTICE PAMIDIGHANTAM SRI NARASIMHA
HON’BLE MR. JUSTICE JOYMALYA BAGCHI
For Petitioner(s) :Mr. Harsh Parashar, AOR
Ms. Kanu Garg, Adv.
Mr. Chanakya Sharma, Adv.
Mr. Harsh Parashar, AOR
For Respondent(s) :Mr. Bishwajit Dubey, A.A.G.
Mr. Vinayak Sharma, Standing Counsel, Adv.
Mr. Ravinder Kumar Yadav, AOR
Mr. Karan Khetnai, Adv.
UPON hearing the counsel the Court made the following
O R D E R
1. Leave granted.
2. The Civil Appeal is disposed of in terms of the signed
order.
3.Pending applications, if any, also stand disposed of.
(INDU MARWAH) (NIDHI WASON) AR-cum-PS COURT MASTER (NSH) (signed order is placed on the file)
[ad_2]
Source link