M.P. Road Development Corporation V. Baisakhi Alias Sadhu

Author – Aditi Goel, 4th year student at Symbiosis Law School NOIDA.

Citation – MISC PETITION NO. 1532/2021

Bench – VISHAL DHAGAT

Original Copy – N/A

Issues in Question :

• Whether the compensation awarded by a competent authority, and would the petitioner be liable to pay the same?

Background of the Case :

• A petitioner filed a miscellaneous petition regarding an order passed by First Additional District Judge, Mandla. The registry raised an objection regarding the maintainability of the said misc. petition. It pointed out that the aisc. appeal under Order 43 Rule 1 of CPC should have been filed by the petitioner instead of a misc. petition under Article 227 of the Constitution. 
• The petitioner filed an application under Section 34 of the Arbitration and Conciliation Act, 1996 which was returned so that they could file it in the appropriate civil court. The said court returned the petition stating that the Divisional Commissioner, Jabalpur has been appointed as an arbitrator by the Central Government. 
• Since the arbitrator’s seat was in Jabalpur, it was decided that the principal civil court in Jabalpur would have the authority to hear and determine an application filed under Section 34 of the Act of 1996. Petitioner’s application under Section 34 of the A&C Act was returned to him to be submitted before the appropriate court.

Judgement :

• The court stated an apex court judgement, Kandla Export Corporation and Another v. OCI Corporation and Another. The judgement held that:

1. )The court relied on the following judgements to understand the meaning of proviso. The judgements were: 

1. CIT v. Indo-Mercantile Bank Ltd.: A proviso is inserted as an exception to the particular statute, an exception which would fall under the enactment. 
2. Das, C.J. in Abdul Jabar Butt v. State of Jammu & Kashmir and Bhagwati, J., in Ram Narain Sons Ltd. v. Assistant Commissioner of Sales Tax: It was said that a proviso is to be harmoniously understood and read with the main enactment. 
3. Madras & Southern Maharatta Railway Co. v. Bezwada Municipality: Proviso generally creates an exception and carves out something which would otherwise fall in the ambit of the section. 

        2) Orders are not enumerated under Order XLIII of CPC, hence making it not appealable.  

        3) A plea mentioned in Arbitration Act’s Section 16 Clauses (2) and (3), would not be appealable under Section 37(2)(a) of the A&C Act and Section 13(1) of Commercial Courts Act, 2015 once it is rejected.  

• Keeping the above mentioned in mind, the court drew a conclusion that the Arbitration and Conciliation Act, 1996 will overpower provisions of Commercial Courts Act, 2015 and Code of Civil Procedure, 1908 because Act, 1996 is a special provision Act. 
• As an appeal is not viable under Section 37 of the Arbitration and Conciliation Act of 1996, the petitioner cannot file a miscellaneous appeal before this court under Order 43 of the Code of Civil Procedure read with Section 13 of the Commercial Courts Act. The same objection submitted by the registry was overruled.

• Relying on the principle laid down by the apex court in the case of Bharat Aluminium Co v. Kaiser Aluminium Technical Services Inc., it is obvious that there is no arbitration agreement between the parties establishing a seat of arbitration. The compensation for land acquisition for the construction/widening of the National Highway is set by the competent authority.

Critical Analysis :

• The parties did not agree with the sum established by competent authority. An application was filed to have an arbitrator, appointed by the Central Government, assess the amount of compensation. By decision dated 17.05.2013, the Central Government designated Commissioner, Jabalpur as an arbitrator for deciding compensation under Section 3G(5) of the National Highways Act, 1956.
• On August 29, 2017, the Commissioner of Jabalpur issued an award in accordance with sections 3G(5) and 3G(6) of the National Highways Act, 1956. The provisions of the Arbitration and Conciliation Act of 1996 are made relevant for the purpose of determining compensation by the Commissioner.
• According to the Central Government’s announcement, Commissioner Jabalpur was appointed as Arbitrator, and both parties participated in the arbitration procedures before Commissioner Jabalpur. As the seat and venue of the arbitration procedures were both in Jabalpur, an action for setting aside the award under Section 34 of the Act of 1996 will be heard by the Principal Civil Court of original jurisdiction in Jabalpur rather than in Mandla.
• The court concludes by saying that the Additional District Judge had not made any errors in the application that was filed and presented. The Order of the First Additional District Judge was affirmed, leading to the dismissal of the Misc. Petition.