MP High Court Pulls Up MPRTC For Delay In Paying Arbitral Award, Notes ₹1.5 Crore Grew To ₹6 Crore With Interest

The Madhya Pradesh High Court has recently pulled up the Madhya Pradesh Road Transport Corporation (MPRTC) for delaying payment of a Rs 1.5-crore arbitral award for years, observing that the liability has now escalated to more than Rs 6 crore due to accumulated interest, resulting in “misuse and wastage of public money.”

Setting aside an order of the executing court that had dismissed the execution proceedings for non-payment of process fee, a Division Bench of Justices Vivek Rusia and Pradeep Mittal restored the execution case in a dispute between A R Resource Management Consultants and MPRTC.

The bench remarked that

"It is very unfortunate that against the awarded amount of Rs. 1.50 Crore, the Respondent/Corporation is going to pay more than Rs. 6.00 Crores. Had the amount under execution been deposited before the Executing Court, the liability to pay interest would not have come on the corporation. This is nothing but misuse and wastage of public money, for which responsibility should have been fixed on the officers concerned dealing with this matter.”

The dispute arises out of an arbitral award dated October 27, 2008 directing MPRTC to pay Rs 1.50 crore to A R Resource Management Consultants along with interest at 12% per annum from March 30, 2004 till the date of the award, and further interest at 18% if the amount remained unpaid.

MPRTC had challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996, but the challenge was dismissed. Thereafter, an arbitration appeal filed before the High Court in 2012 continues to remain pending.

In the meantime, the award-holder initiated execution proceedings to enforce the award. By an order dated December 11, 2013, the High Court directed MPRTC to deposit Rs 50 lakh before the executing court. An application seeking modification of that order was dismissed on November 11, 2014, and MPRTC's Special Leave Petition before the Supreme Court was dismissed on July 19, 2016.

During the pendency of the appeal, MPRTC deposited Rs 3.83 crore before the executing court, and the amount was released to the award-holder. Even so, the execution case continued to remain on the file for several years and was ultimately dismissed on June 16, 2025 after the executing court recorded non-payment of process fee.

A R Resource Management Consultants challenged this dismissal before the High Court, pointing out that the execution proceedings had been pending for over a decade. It argued that process fees had been deposited on multiple occasions to secure service of notices, but the corporation did not respond despite those steps.

On examining the record, the High Court observed that the respondent had shown little inclination to take part in the execution proceedings, even though notices were attempted to be served repeatedly.

The bench recorded that "the petitioner/degree holder has been paying the process fee a number of times, but no response from the respondent side.”

The court observed that the corporation's conduct resulted in mounting interest liability on the principal award amount.

During the hearing, MPRTC Managing Director Manish Singh appeared through counsel and produced a demand draft of Rs 3,32,31,838 towards the remaining liability.

Taking note of this, the High Court quashed the order dismissing the execution case and restored the proceedings.

The court directed MPRTC to appear before the executing court on March 10, 2026, along with the demand draft so that the remaining amount may be deposited.

It further directed that the amount shall remain with the executing court and be released only after final disposal of the pending arbitration appeal, which the court said should preferably be decided within six months.

For AR Resource Management Consultants: Advocate Tabrez Sheikh

For MP Road Transport Corporation: Advocates Aditya Awasthi, Vasu Jain

For State of Madhya Pradesh: Additional Advocate General Janhavi Pandit

Managing Director of MPRTC: Manish Singh (present through counsel)