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2021 (12) TMI 174 - SC - Indian LawsPrinciple of Issue Estoppel - whether, in view of the award declared by the Housing Commissioner, M.P. Housing Board, who was appointed as an arbitrator pursuant to the order passed by the High Court in Writ Petition No.9131 of 2008, was it open for the respondent contractor thereafter to file a reference before M.P. Arbitration Tribunal with respect to the very claim/claims which were the subject matter of arbitration before the Arbitrator Housing Commissioner? HELD THAT - Apart from the fact that the award declared by the Arbitrator Housing Commissioner was not challenged by the respondent contractor, even, so long as the said award is not challenged before the higher forum the same is binding between the parties. Even the award or a nullity order has to be challenged before the appropriate forum/higher forum. In the present case it cannot be said that there was a total lack of jurisdiction of the Arbitrator Housing Commissioner in passing the award as it was the High Court who passed the order with consent referring the dispute between the parties for the adjudication to the Arbitrator Housing Commissioner. Therefore, unless and until it was challenged by the contractor before the higher forum, the respondent contractor cannot be permitted to ignore and/or to avoid the award passed by the Arbitrator Housing Commissioner dated 07.11.2008. As per Section 19 of the 1983 Act, Revision Application to the High Court shall be maintainable only against the award passed by the learned Arbitral Tribunal. Therefore, prima facie it appears that as such the order passed by the learned Arbitral Tribunal rejecting the reference petition was not maintainable as by order dated 27.02.2017, no award was passed by the Tribunal - technically speaking the award passed by the Arbitrator Housing Commissioner dated 07.11.2008 stands even today. It is binding between the parties. So long as the award passed by the Arbitrator Housing Commissioner dated 07.11.2008 stands, there cannot be any subsequent fresh proceeding with respect to the same claims which were considered and adjudicated by the Arbitrator Housing Commissioner while passing the award dated 07.11.2008. So long as the said award stands it is binding between the parties. As no objections were raised by the respondent contractor at the appropriate stage, the award cannot be annulled subsequently. At the cost of repetition, it is observed that at no point of time the respondent contractor had challenged the award passed by the Arbitrator Housing Commissioner and as observed and held hereinabove even no court has set aside the award declared by the Arbitrator Housing Commissioner dated 07.11.2008 and the same has attained finality. Therefore, the same is binding between the parties - the subsequent fresh reference petition before the learned Arbitral Tribunal under the 1983 Act for the very same claims which were raised before the Arbitrator Housing Commissioner would not be maintainable at all. We agree with the view taken by the Arbitral Tribunal. The impugned judgment and order passed by the High Court quashing and setting aside the order passed by the learned Arbitral Tribunal constituted under the 1983 Act dated 27.02.2017 is hereby quashed - Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Jurisdiction of the Housing Commissioner as Arbitrator. 2. Validity and finality of the award passed by the Housing Commissioner. 3. Maintainability of the fresh reference petition before the Madhya Pradesh Arbitration Tribunal. 4. Applicability of the principle of issue estoppel. 5. Interpretation of the Madhya Pradesh Madhyastham Adhikaran Act, 1983 (the 1983 Act) versus the Arbitration and Conciliation Act, 1996. Detailed Analysis: Jurisdiction of the Housing Commissioner as Arbitrator: The primary issue was whether the Housing Commissioner had the authority to act as an arbitrator in the dispute. The respondent contractor had initially approached the High Court, which referred the dispute to the Housing Commissioner as an arbitrator through a consent order. The contractor later argued that the Housing Commissioner lacked jurisdiction, as the dispute should have been adjudicated by the Tribunal under the 1983 Act. However, the court held that since the order was consensual and the contractor had participated in the arbitration proceedings, the jurisdiction of the Housing Commissioner could not be questioned later. The court emphasized that the contractor did not raise any objection to the jurisdiction at the relevant stage, thus binding the parties to the arbitrator's decision. Validity and Finality of the Award: The award passed by the Housing Commissioner on 07.11.2008 was not challenged by the respondent contractor under Section 34 of the Arbitration Act, 1996. The court noted that the award had attained finality and was binding between the parties. The contractor's subsequent review petition seeking clarification of the High Court's order was also dismissed, further solidifying the finality of the award. The court underscored that even an award perceived as a nullity must be challenged before the appropriate forum; otherwise, it remains binding. Maintainability of the Fresh Reference Petition: The contractor filed a fresh reference petition before the Madhya Pradesh Arbitration Tribunal under Section 7 of the 1983 Act, which was dismissed by the Tribunal as not maintainable. The Tribunal held that the dispute had already been adjudicated by the Housing Commissioner, and the award had attained finality. The High Court initially set aside this decision, but the Supreme Court reversed the High Court's order, restoring the Tribunal's decision. The Supreme Court emphasized that the same claims could not be re-litigated once they had been decided by a competent arbitrator. Applicability of the Principle of Issue Estoppel: The court applied the principle of issue estoppel, which prevents re-litigation of issues that have already been conclusively decided between the same parties. The court observed that the contractor had raised identical claims before the Housing Commissioner, the High Court, and the Tribunal. Since the Housing Commissioner's award had attained finality, the contractor was estopped from raising the same issues again. The court cited precedents to support the application of issue estoppel, reinforcing that the earlier arbitration proceedings and the resultant award were binding. Interpretation of the 1983 Act versus the Arbitration Act, 1996: The court addressed the contention that the 1983 Act, being a special statute, should prevail over the Arbitration Act, 1996. However, it was noted that the High Court's order referring the dispute to the Housing Commissioner was a consent order, and the contractor had accepted and participated in the arbitration process. The Supreme Court held that the consent order and the subsequent arbitration proceedings under the Arbitration Act, 1996, were valid and binding. The court also noted that the contractor had not raised any jurisdictional objections during the arbitration proceedings, further validating the process under the Arbitration Act, 1996. Conclusion: The Supreme Court allowed the appeals, setting aside the High Court's judgment and restoring the Tribunal's order dismissing the reference petition as not maintainable. The court reaffirmed the finality of the Housing Commissioner's award and applied the principle of issue estoppel to bar the contractor from re-litigating the same claims. The decision emphasized the binding nature of consent orders and the necessity of challenging awards through appropriate legal channels to prevent their binding effect.
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