Amitava Majumdar (Raja)
Tripti Sharma
Deepanshi Kapoor
Published On June 11, 2026
The Supreme Court of India, in its recent judgment in Madhya Pradesh Road Development Corporation Ltd. v. M/s Jabalpur Corridor Pvt. Ltd. 1 , dismissed the appeal filed by Madhya Pradesh Road Development Corporation Ltd. (“MPRDC” / “Appellant”) challenging an arbitral award of approximately INR 49 crores together with pre-award interest at 14.75% (“Award”). In doing so, the Court came down heavily upon MPRDC, a wholly owned undertaking of the Government of Madhya Pradesh, for adopting every conceivable tactic to delay payment of contractual dues.
While noting that this was a classic case of ‘justice delayed is justice denied’, the Supreme Court expressed that the court has to ensure that arbitration is accepted as a norm, and its true essence of party autonomy and equality is realized. The Supreme Court also candidly observed that while arbitration as a dispute resolution mechanism has not failed in India, courts have, at times, failed arbitration through unnecessary intervention.
MPRDC invited bids for the construction of the Jabalpur Sagar Damoh Road Project (“Project”). Tiara Dhaya Maju Constructions (“TDM Constructions”), the successful bidder, incorporated a Special Purpose Vehicle, Jabalpur Corridor Pvt. Ltd. (“Respondent”) for the implementation of the Project.
The Appellant, along with the Respondent and TDM Constructions, entered into a Concession Agreement (“Agreement”) on 11.04.2003 for the construction of the Project. Pursuant to the Agreement, the Respondent entered into a loan agreement dated 23.07.2004 with EXIM Bank Malaysia.
Disputes arose between the Appellant and the Respondent under the Agreement in relation to the completion of the Project, primarily on account of delay by the Appellant in handing over vacant possession of land required for construction.
As the Project stalled, the Respondent filed a Writ Petition before the Madhya Pradesh High Court (“High Court”) seeking handover of vacant land. During the pendency of the Writ Petition, the Appellant terminated the Agreement on 12.07.2007. By that stage, the Respondent had already expended approximately INR 49.47 crores from the loan facility availed from EXIM Bank.
The said termination was challenged by the Respondent, who sought ‘termination payment’ under Clause 32.6 of the Agreement. The disputes were referred to arbitration.
During the pendency of arbitral proceedings, the Appellant challenged the jurisdiction of the Arbitral Tribunal under Sections 16 and 14 of the Arbitration and Conciliation Act, 1996 (the “Act”) and separately sought termination of the arbitrators' mandate, contending that the dispute was governed by the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983 (“Adhiniyam”) as the Agreement was a “works contract”. While the District Court initially accepted this contention, the High Court subsequently set aside that order and held that the disputes were arbitrable under the Act. The High Court's decision was challenged before the Supreme Court but ultimately attained finality after being affirmed by the Apex Court.
Subsequently, the Arbitral Tribunal passed a majority award dated 22.08.2014, allowing the claims of the Respondent and dismissing the Counter-claim of the Appellant. Costs, together with post-award interest at 18% per annum, were also awarded.
Thereafter, the Appellant moved an application under Section 34 of the Act before the District Court, which was dismissed. The District Court issued a detailed order rejecting every objection taken by the Appellant against the Award.
The Appellant, thereafter, filed an appeal under Section 37 of the Act before the High Court. The said appeal was dismissed by the High Court. Hence, the present appeal was filed by the Appellant before the Supreme Court.
