Hindustan Petroleum Corporation LTD vs. M.P. Poorv Kshetra Vidyut Vitran Co. LTD.

Held

The High Court held that the contract for the supply of transformer oil does not fall under the definition of 'Works Contract' as defined in Section 2(1)(i) of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983. The Court reasoned that the definition of 'Works Contract' specifically pertains to agreements for the execution of works relating to construction, repair, or maintenance of various structures, including transformers. A contract solely for the supply of oil to be used in transformers, without involving any construction, repair, or maintenance of the transformer itself, does not meet this definition. The Court noted that if the petitioner had been awarded the work of constructing, repairing, or maintaining a transformer, the dispute would have been covered. Since the petitioner was only contracted to supply oil, the Tribunal correctly dismissed the reference as not maintainable. The Court found no infirmity in the Tribunal's decision and no grounds to interfere with the impugned order.

Facts

Hindustan Petroleum Corporation Limited (HPCL), the petitioner, entered into a contract with M.P. Poorv Kshetra Vidyut Vitran Co. Ltd. (MPKVVL), the respondent, for the supply of transformer oil. HPCL supplied 931.015 Kilolitres of oil and raised a bill for Rs. 6,61,13,255.04. MPKVVL paid Rs. 5,47,60,326.96, withholding Rs. 1,13,83,164.11. This dispute led HPCL to file a reference under Section 7 of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983, before the Madhya Pradesh Arbitration Tribunal. The Tribunal dismissed the reference, holding that the contract for the supply of transformer oil did not fall under the definition of 'Works Contract' as per Section 2(1)(i) of the Adhiniyam, 1983. HPCL then filed the present Arbitration Revision before the High Court.

Key Issues

1. Whether the contract for the supply of transformer oil, as entered into between the petitioner and the respondent, constitutes a 'Works Contract' under Section 2(1)(i) of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983, thereby conferring jurisdiction on the Arbitration Tribunal? Petitioner's arguments: The petitioner contended that the Arbitration Tribunal failed to properly appreciate the definition of 'Works Contract' under Section 2(1)(i) of the Adhiniyam, 1983. They argued that the definition is inclusive and broad, intended to cover a maximum number of disputes. They further submitted that the supply of transformer oil is an integral ingredient for the functioning of a transformer, making it a 'work' or part of a 'work' related to transformers. Respondent's arguments: The respondent did not file any specific arguments in the High Court judgment provided. The Tribunal's reasoning, as reflected in the judgment, was that a contract for the supply of oil does not relate to the construction, repair, or maintenance of a transformer.