1 2025:CGHC:50862 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR CR No. 119 of 2018 1 - M/s. Tirupati Build-Con Pvt. Ltd. A Private Limited Company , Through Its Managing Director, Shri Padam Kumar Singhania, Aged About 56 Years, Opp. Railway Station P. O. Burhar, District Shahdol M. P., District : Shahdol, Madhya Pradesh .. Petitioner versus 1 - The State of Chhattisgarh Through The Secretary, Public Work Department, Mahanandi Bhawan, Naya Raipur District Raipur Chhattisgarh, District : Raipur, Chhattisgarh 2 - The Chief Engineer, PWD, Bilaspur Zone, District Bilaspur Chhattisgarh, District : Bilaspur, Chhattisgarh 3 - The Superintending Engineer PWD, Bilaspur Circle, Bilaspur District Bilaspur Chhattisgarh, District : Bilaspur, Chhattisgarh Digitally signed by GOPAL SINGH Date: 2025.10.16 17:35:17 +0530 2 4 - The Executive Engineer PWD, Pendra Division, Pendra Road, District Bilaspur Chhattisgarh, District : Bilaspur, Chhattisgarh ... Respondents For Petitioner : Shri Shreyansh Dharmadhikari (through video conferencing) and Shri Harsh Wardhan, Advocates For Respondents/State : Shri R.S. Marhas, Additional Advocate General (Single Bench) Hon’ble Shri Justice Sanjay K. Agrawal Order on Board 13/10/2025 1. This instant revision under Section 19 of the Chhattisgarh Madhyastham Adhikaran Adhiniyam, 1983 (for short ‘the Adhiniyam of 1983’) is directed against the award dated 11.7.2018 passed by the Chhattisgarh Madhyastham Adhikaran, Raipur in Reference Case No.19 of 2016, by which the reference petition preferred by the petitioner herein under Section 7-A of the Adhiniyam of 1983 has been dismissed as barred by limitation and eventually also on merits. 2. The aforesaid challenge has been made on following factual background: 3 3. The petitioner herein was awarded a contract for work of widening and improvement of Basantpur – Kariyam Road in Kilometres 9 to 23 and accordingly agreement was executed for value of Rs.2078.06 lakhs and time period was 15 months from the date of award and work order was issued and ultimately during the course of execution of the work on 30.4.2015 liquidated damages amounting to Rs.31,17,900, was imposed against the petitioner. Ultimately, after conclusion of the contract on 17.9.2015, the petitioner was paid final bill on which Rs.31,17,900 was deducted towards the liquidated damages. 4. Feeling aggrieved against the deduction of liquidated damages to extent of Rs.31,17,900, the petitioner herein preferred an appeal before the Chief Engineer/Final Authority under Clause 28 of the agreement on 5.10.2015 questioning the order dated 30.4.2015 and other issues. Ultimately, on 13.10.2015, the appeal was dismissed by the Chief Engineer finding no merit. 5. Questioning the order dated 13.10.2015, the petitioner herein preferred reference petition under Section 7 of the Adhiniyam of 1983 before the Chhattisgarh Madhyastham Adhikaran, Raipur on 4.10.2016 questioning the order dated 13.10.2015. 4 That reference petition was dismissed as barred by limitation along with order on merits. Questioning that, the instant revision has been preferred. 6. Shri Shreyansh Dharmadhikari (through video conferencing) and Shri Harsh Wardhan, learned counsel appearing for the petitioner would submit that the Arbitration Tribunal is absolutely unjustified in dismissing the reference petition of the petitioner as barred by limitation as the Chief Engineer has decided the appeal of the petitioner under Clause 48 of the agreement only on 13.10.2015 and as per Section 7-B(1)(b) on 4.10.2016 within 1 year the revision has been preferred, therefore, it was within limitation and could not have been rejected as barred by limitation and once the Arbitration Tribunal has held the reference petition to be barred by limitation it could not have decided the reference petition on merits also. Therefore, the instant revision may be allowed and the reference petition may be held to be within limitation and it may be remanded back to the Arbitration Tribunal for deciding the same in accordance with law on merits. 7. Shri R.S. Marhas, learned Additional Advocate General appearing for the respondents/State would support the 5 impugned award. He would submit that the order dated 30.4.2015 was open for challenge by the petitioner during concurrence of the contract and, therefore, it has not been filed within 1 year from 30.4.2015 and as such the Arbitration Tribunal has rightly rejected the reference petition as barred by limitation. 8. I have heard learned counsel appearing for the parties, considered the rival submissions and gone through the record minutely. 9. Section 7-B of the Adhiniyam of 1983 provides as under: “7-B. Limitation.–(1) The Tribunal shall not admit a reference petition unless– (a) the dispute is first referred for the decision of the final authority under the terms of the works contract; and (b) the petition to the Tribunal is made within one year from the date of communication of the decision of the final authority: Provided that if the final authority fails to decide the dispute within a period of six months from the date of reference to it, the petition to the Tribunal shall be made within one year of the expiry of the said period of six months. xxx xxx xxx” 6 10. A careful perusal of Section 7-B(1)(b) of the Adhiniyam of 1983 shows that the Tribunal shall not admit a reference petition unless the petition to the Tribunal is made within one year from the date of communication of the decision of the final authority. 11. In the instant case, Rs.31,17,900 was deducted from the petitioner’s final bill on 17.9.2015 and thereafter the petitioner preferred an appeal under Clause 28 of the agreement (an arbitration clause) for wrongly deducting the damages on 5.10.2015 before the Final Authority/Chief Engineer and the Chief Engineer has dismissed the appeal on 13.10.2015. As per the record also, the reference petition under Section 7-A of the Adhiniyam of 1983 was filed before the Arbitration Tribunal on 4.10.2016. As per Section 7-B(1)(b) of the Adhiniyam of 1983, it appears that the Final Authority/Chief Engineer has passed the order on 13.10.2015 within 1 year and on 4.10.2016 the reference petition has been filed, which is apparently within the period of limitation prescribed under the aforesaid provision. It cannot be held to be barred by limitation. 12. The Madhya Pradesh High Court in the matter of Sanjay Dubey v. State of M.P. and another, 2012 (4) MPLJ 212 has 7 clearly held that when the contract contains an arbitration clause the jurisdiction of the Tribunal can be invoked only after approaching Final Authority as per terms of the contract. The Madhya Pradesh High Court held in paragraph 13 as under: “13. In view of the preceding analysis, we proceed to state our conclusions as under:ー (i) Where the works contract contains a clause like Clause 29, the jurisdiction of the Tribunal can be invoked only after approaching the Authority as provided under the terms of the works contract. (ii) However, subject to final adjudication of the issue by the Supreme Court as to whether Tribunal under the Act is a Court or not, in case where the dispute has arisen under an agreement prior to coming into force of section 7-B(2-A) of the Act which does not contain a clause like Clause 29, an aggrieved person has to approach the Tribunal within a period of three years from the date of accrual of cause of action. (iii) Where the works contract does not contain any provision like Clause 29 and the dispute has arisen after coming into force of section 7-B(2-A) of the Act, in such a case, sub-section (2-A) of section 7-B of the Act will apply and an aggrieved person can approach the Tribunal within a period of three years from the date on which the works contract is terminated, foreclosed, abandoned or 8 comes to an end in any other manner or when a dispute arises during the pendency of the works contract. (iv) In a case where the agreement is rescinded, two questions may arise for consideration. Firstly, which party to the agreement is at fault and consequently, claim for damages for breach of contract. Secondly, the claim with regard to payment of amount of the final bill before rescission of the contract in accordance with the rates prescribed in the agreement. In the first case, the limitation would commence from the date when the agreement is rescinded whereas in the second case, the limitation would commence from the date when the final bill is prepared. (v) The dispute under Clause 29 has to be submitted within the time limit which has been prescribed in the clause. The dispute cannot be submitted to the Authorities mentioned in Clause 29 of the Agreement within a period of three years as the provisions of Limitation Act do not apply to the Authorities under the Agreement as they are not the Courts. (vi) Clause 29 of the Agreement is not violative of section 28(b) of the Indian Contract Act, 1872.” 13. In that view of the matter, the petitioner was required to wait till the conclusion of the contract and thereafter rightly invoked the jurisdiction of the final authority under Clause 28 and against the decision of the Final Authority on 13.10.2015 preferred the reference petition under Section 7-B of the Adhiniyam of 1983 9 on 4.10.2016 which was within the period of limitation. As such, the Arbitration Tribunal is absolutely unjustified in rejecting the reference petition as barred by limitation under Section 7-B(1)(b) of the Adhiniyam of 1983. The reference petition is held to be within the period of limitation. 14. The further findings recorded by the Arbitration Tribunal for the rest of the matter on merits also deserve to be set aside. Once the Arbitration Tribunal has held that reference petition was barred by limitation, it was not obliged to decide the other issues on merits. Accordingly, the finding on other issues are also set aside. 15. The reference petition is restored to the Board of Chhattisgarh Madhyastham Adhikaran, Raipur for hearing and disposal in accordance with law on merits expeditiously as the contract was awarded to the petitioner on 11.4.2012. 16. Consequently, the civil revision is allowed to the extent indicated hereinabove. Sd/- (Sanjay K. Agrawal) JUDGE Gopal