Andhra High Court Rules Writ Against NH Act Arbitration Award Not Maintainable

A Division Bench of the Andhra Pradesh High Court has firmly held that a writ petition under Article 226 directly assailing an arbitral award under the National Highways Act, 1956 cannot be entertained when the statutory remedy under Section 34 of the Arbitration and Conciliation Act, 1996 remains available. The bench of Justice Ravi Nath Tilhari and Justice Purushottam Kumar Chintalapudi allowed an appeal by the National Highways Authority of India (NHAI) , setting aside a Single Judge's order that had remanded the matter to the arbitrator.

The Dispute Over Land Valuation

The case originated from the acquisition of a parcel of land in Anakapalli Village and Mandal, owned by Kandukuri Rama and another petitioner, for a national highway project. The competent authority under the NH Act passed Award No.46/2018 on 5 November 2018 , fixing compensation. Dissatisfied, the landowners invoked arbitration under Section 3G(6) of the NH Act , which applies the 1996 Act to such proceedings. The arbitrator, in Arbitration No.195/2019, upheld the original award on 21 March 2022 .

Instead of filing a petition under Section 34 of the 1996 Act to set aside the arbitral award , the landowners directly approached the High Court in 2022 under Article 226. They argued that the arbitrator had failed to consider a 29 September 2018 letter from the Visakhapatnam Urban Development Authority (VUDA) , which indicated the land fell partly in an industrial zone. The Single Judge accepted this contention, set aside the award, and remanded the matter for fresh consideration of the VUDA letter.

NHAI's Challenge and the Maintainability Question

NHAI contended that the writ petition was not maintainable because the NH Act read with the 1996 Act provides a complete statutory remedy under Section 34, and none of the recognized exceptions to the rule of exhausting alternative remedies applied. The landowners, however, argued that the writ was maintainable and that the VUDA letter had not been properly appreciated.

The Bench's Reasoning

The Division Bench first examined the well-settled principles governing the exercise of writ jurisdiction in the face of an alternative statutory remedy. Citing the Supreme Court 's decisions in Whirlpool Corporation v. Registrar of Trade Marks , Commissioner of Income Tax v. Chhabil Dass Agarwal , and Rikhab Chand Jain v. Union of India , the bench reiterated that the High Court should ordinarily not entertain a writ petition when an effective alternative remedy exists. The recognized exceptions — violation of fundamental rights , breach of natural justice , lack of jurisdiction , or challenge to the vires of a statute —were found to be wholly inapplicable in this case.

"The N.H. Act and the Act, 1996 are complete code . The statute provides the remedy under Section 34 of the Act, 1996 to challenge the award of the arbitrator on specified grounds," the bench observed. "Challenge to the award directly under Article 226 of the Constitution of India without taking recourse to Section 34 of the Act, 1996, in the absence of any well recognized exceptions being attracted, must ordinarily fail on the ground of statutory alternative remedy ."

The VUDA Letter: A Misconception

Crucially, the bench found that the Single Judge had proceeded on an incorrect factual premise. The arbitrator had in fact considered the VUDA letter but declined to rely on it, noting that the letter did not specifically mention the acquired survey number and that the landowners had not produced evidence of payment of change of land use charges. The award reproduced the letter's content and discussed it at length.

"From the aforesaid, it is clear beyond any doubt that the letter of VUDA dated 29.09.2018 was taken into consideration while passing the award by the arbitrator but reliance was not placed for the reasons recorded in the award itself," the bench held. "So, in our view, it is not a case of ignoring or not taking into consideration the letter."

Key Observations

The court made several pointed observations:

  • "When the statutory alternative remedy was available but was not availed of the writ petition was not entertainable in the absence of the well recognized exceptions ."

  • "If a remedy is available to a party before the High Court in another jurisdiction, the writ jurisdiction should not normally be exercised on a petition under Article 226, for, that would allow the machinery set up by the concerned statute to be bye-passed."

  • "The writ petitioners however shall be at liberty to seek such other remedy as may be open to them under law, before the appropriate forum, if so advised."

Final Decision and Implications

The Division Bench allowed the writ appeal, setting aside the Single Judge's judgment dated 24 January 2025 in W.P.No.13038 of 2022. The order of remand was quashed. The landowners were left free to pursue any other remedy available before the appropriate forum. No order as to costs.

The judgment serves as a clear reminder that the High Court's writ jurisdiction is not a substitute for statutory remedies specifically designed to challenge arbitral awards. It reinforces the principle that where the statute provides a complete code for redressal, litigants must exhaust that mechanism before seeking constitutional remedies , unless they fall within the narrow exceptions carved out by judicial precedents .