Indore (Madhya Pradesh): The Madhya Pradesh High Court has upheld the use of provisions of the Arbitration and Conciliation Act, 1996, to determine the fees of a panel appointed to decide a compensation dispute involving the Indore Municipal Corporation (IMC).
However, it ruled that an officer of the Indore Development Authority (IDA) serving on the panel would not be entitled to any remuneration.
A division bench comprising Justice Subodh Abhyankar and Justice Alok Awasthi dismissed two appeals filed by the IMC and others against identical orders passed by the writ court on Oct 10, 2023.
The dispute arose under Section 387 of the Madhya Pradesh Municipal Corporation Act, 1956, which deals with compensation claims following demolition by a municipal corporation.
The District Court, Indore, had constituted a two-member panel comprising IDA assistant engineer Kapildev Bhalla and Rajendra Pradhan to assess the claim. The panel appointed retired district judge Gulab Sharma as the umpire.
The claimant sought compensation of Rs 30.46 lakh. The panel subsequently fixed its fees under the Arbitration and Conciliation Act and directed the claimant and the IMC to share the expenses equally.
The corporation challenged the fee arrangement, arguing that the amount was excessive and that the claimant, having invoked Section 387, should bear the entire expense. After the writ court rejected its challenge, the IMC approached the High Court.
The division bench held that the Arbitration and Conciliation Act could apply to arbitration proceedings under another enactment unless its provisions were inconsistent with that law. It found no such inconsistency in the present case.
The court also observed that concerns regarding excessive claims or fees could be addressed by the arbitral tribunal under Section 31A of the 1996 Act.
While dismissing the appeals, the court modified the arrangement to clarify that the IDA officer would receive no fee. Any amount otherwise payable to him must instead be deposited in the IDA's account.
