Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Arbitration – Arbitral Award |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Arbitration – Arbitral Award – In the instant case, the State issued tender notice for construction of Masonry Dam and the appellant-contractor was successful bidder – During the course of work, the contractor requested for an alternate quarry which request was denied and the matter was referred for arbitration – Thereafter, the contractor made another request for another alternate quarry (Mahuar Quarry) – Upon inspection, the constituted committee approved the request and a conditional permission was granted to the contractor – Despite conditional permission, the contractor raised claim of Rs 5,51,03,040/- towards escalated cost of transportation – The claim was rejected by the authority but the same was accepted in arbitral proceeding by the Arbitrator – High Court upheld the award – Hence instant appeal – Held: A contractual clause which provides for the finality of rates quoted by the Contractor and disallows any future claims for escalation is conclusive and binding on the parties and if the clause debarring future claims permits escalation subject to certain conditions, and the conditions are satisfied, which in the present case were actually satisfied as the circumstances were beyond the control of the contractor, the Contractor will have a right to claim escalation. Contract: Government contracts – The rights and duties of the parties to the contract subsist or perish in terms of the contract itself – Even if a party to the contract is a governmental authority, there is no place for discretion vested in the officers administering the contract – Discretion, a principle within the province of administrative law, has no place in contractual matters unless, of course, the parties have expressly incorporated it as a part of the contract – It is the bounden duty of the court while interpreting the terms of the contracts, to reject the exercise of any such discretion that is entirely outside the realm of the contract. |
Judge | Hon'ble Mr. Justice Pamidighantam Sri Narasimha |
Neutral Citation | 2022 INSC 1217 |
Petitioner | The State Of Madhya Pradesh |
Respondent | M/s Sew Construction Limited & Ors. |
SCR | [2022] 9 S.C.R. 731 |
Judgement Date | 2022-11-18 |
Case Number | 8571 |
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