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of <h1>Petitioners must exhaust contractual remedy under Clause 71 before approaching court for contract disputes over Rs. 10 crore</h1> <h3>M/s. Gemini Promoters Builders Private Ltd., M/s. Ramji Das Dhal Construction Private Limited Versus Union of India and others</h3> MP HC held that petitioners must first exhaust contractual remedy under Clause 71 before approaching court. The clause mandates disputes in contracts ... Maintainability of petition - efficacious alternative remedy available to petitioners - Contractual dispute - completion or alleged completion of the Works or termination or determination of the Contract - Reference to the Dispute Resolution Board - Clause 71 of the General Conditions of Contract - HELD THAT:- Clause 71 provides for referring disputes first to the Disputes Resolution Board in case the contacts valuing to ₹ 10 crore or more, which would precede reference of dispute to the arbitrator under Clause 70 of the agreement. It is therefore Clause 71 which has to be first applied and the remedy available before the Dispute Resolution Board has to be first exhausted. We are not inclined to uphold the argument that Dispute Resolution Board could be constituted only if petitioner agreed and, therefore, since the petitioners have not given their consent, such Board could not be constituted. We are therefore persuaded to uphold the preliminary objection raised by the learned counsel for the respondents and direct the respondents to constitute a Dispute Resolution Board within a period of one month from the copy of passing of this order is produced before them and further direct that the Board shall, after providing opportunity of hearing to the petitioners as well as the respondents, give its verdict, within a period of three months thereafter. Petition disposed off. Issues:1. Whether an efficacious alternative remedy is available to the petitioners in a contractual disputeRs.2. Interpretation of Schedule A Notes in the agreements regarding GST reimbursement/refund.Issue 1:The judgment addresses the primary issue of whether an alternative remedy is available to the petitioners in a contractual dispute. The petitioners argued that despite the provision of alternative remedies in the contract, the court should entertain the writ petitions directly due to the absence of dispute resolution. The respondents contended that the contract provides for a Dispute Resolution Board and arbitration as alternative remedies. The court examined the relevant clauses in the contract, specifically Clause 39 of the Special Conditions and Clauses 70 and 71 of the General Conditions. It was highlighted that Clause 71 mandates the referral of disputes to the Dispute Resolution Board before arbitration if the contract value exceeds a specified amount. The court ruled that the remedy before the Dispute Resolution Board must be exhausted first. As the work awarded to the petitioners was ongoing, the court directed the respondents to constitute a Dispute Resolution Board within a month and provide a verdict within three months after hearing both parties.Issue 2:The second issue pertains to the interpretation of Schedule A Notes in the agreements concerning GST reimbursement/refund. The petitioners argued that the Schedule A Notes clearly state that the effect of GST shall be included in the quoted rates, and no reimbursement or refund on this account shall be admissible. The respondents, however, opposed this argument, emphasizing the terms of the contract. The court declined to delve into the interpretation of the Schedule A Notes, as the primary issue of alternative remedy availability needed resolution first. However, the court allowed both parties to present their arguments regarding the interpretation of the corrigendums before the Dispute Resolution Board. This issue was not conclusively decided in the judgment due to the prioritization of the alternative remedy aspect.In conclusion, the High Court of Madhya Pradesh addressed the issues raised in the writ petitions comprehensively. The judgment highlighted the importance of exhausting alternative remedies provided in the contract before resorting to court intervention. While the interpretation of the Schedule A Notes regarding GST reimbursement/refund was not directly resolved, the court allowed for further arguments on this matter before the Dispute Resolution Board. The detailed analysis and direction provided by the court ensure a structured approach to resolving the contractual dispute between the parties involved.
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