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MSP Infrastructure Ltd. v. M.P. Road Development Corporation Ltd.

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 10778 of 2014)Decided 5 Dec 2014
Civil Appeal No. 10778 of 2014
Justice J. Chelameswar · Justice S.A. Bobde

Background

A road development dispute went to arbitration under the parties' agreement and a court-recorded settlement. After an award partly favoured the contractor, the road corporation challenged it and, two years later, sought to add a claim that only the State's statutory tribunal had jurisdiction. The High Court allowed the amendment.

Decision Breakdown

The Supreme Court set aside the High Court's order allowing the amendment. In this judgment, it held that the corporation should have raised its objection to the arbitral tribunal's jurisdiction by the stage of submitting its defence under Section 16, rather than after participating throughout and receiving an adverse award. The proposed objection did not become an independent public policy ground merely because it invoked a different statutory tribunal. The Court distinguished disputes whose subject matter cannot be arbitrated at all and did not decide which of the Central and State arbitration statutes otherwise prevailed.

Lesson Learnt

This 2014 ruling required parties to raise a tribunal-jurisdiction objection promptly rather than saving it for an adverse award. The ruling should be read in its procedural setting, including its distinction between jurisdiction objections and subjects that cannot be arbitrated.

Official source (sci.gov.in)View Judgment (PDF)

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