IN THE HIGH COURT OF KERALA AT ERNAKULAM
GOPINATH P., SYAM KUMAR V.M., JJ.
Jameela W/o Shamsudheen – Appellant
Versus
National Highway Authority Of India-NHAI – Respondent
WA No. 645 of 2024
Decided on : 10-05-2024
NH Act, 1956 - Arbitration - Section 3G - The judgment discusses the applicability of the NH Act, 1956 and the Arbitration and Conciliation Act, 1996 in challenging the award of the Arbitrator. It highlights the limitations of challenging the compensation awarded by the Arbitrator under the NH Act, 1956 through a writ petition under Article 226 of the Constitution of India. The court emphasizes the need to file a petition under Section 34 of the Arbitration and Conciliation Act, 1996 for challenging the award.
Fact of the Case:
The appellants sought to set aside an award of the Arbitrator under Section 3G of the NH Act, 1956, claiming that crucial aspects were not considered and seeking a writ of Mandamus to re-consider the matter.
Finding of the Court:
The court held that the writ petition challenging the award of the Arbitrator under the NH Act, 1956 was not maintainable and directed the appellants to file an application under Section 34 of the Arbitration and Conciliation Act, 1996.
Issues: The main issue was the maintainability of the writ petition under Article 226 of the Constitution of India to challenge the award of the Arbitrator under the NH Act, 1956.
Ratio Decidendi: The court emphasized that the remedy for challenging the compensation awarded by the Arbitrator under the NH Act, 1956 lies in filing a petition under Section 34 of the Arbitration and Conciliation Act, 1996, rather than through a writ petition under Article 226 of the Constitution of India.
Final Decision: The writ appeal was dismissed, and the appellants were directed to avail the statutory remedy under Section 34 of the Arbitration and Conciliation Act, 1996. The time granted to the appellants to file the application under Section 34 was extended, and they were granted 2 days to vacate the acquired property.
The appellants are the petitioners in W.P (C) No.4947/2024. That writ petition was filed by the appellants/petitioners praying inter alia that an award of the Arbitrator under Section 3G of the National Highways Act, 1956 (In short 'the NH Act, 1956) should be set aside as certain crucial aspects which were statutorily required to be considered were not so considered by the Arbitrator.
2. It is the case of the learned counsel for the appellants that the acquisition of the portion of the building including the staircase and the lift room has resulted in a situation where the appellants will have to suffer substantial costs for relocating the said facilities which will also result in the usable area of the hotel coming down. It is her case that the damages so suffered by the appellants is also a matter that should have been taken into consideration by the Arbitrator while determining the compensation payable under the provisions of the NH Act, 1956. The appellants also have a case that they have not been paid any interest in terms of the provisions contained in the NH Act, 1956.
3. It is thus that the appellants were before this Court seeking to set aside the award of the Arbitrator and seeking a writ of Mandamus directing the Arbitrator to re-consider the matter taking note of Exts P5 and P6 reports and the provisions of the NH Act, 1956. The learned Single Judge on a consideration of the matter held as follows:-
4. Sri. K.P. Satheesan, learned Senior Counsel appearing for the National Highways Authority of India on the instructions of Adv. P. Mohandas would submit that the reliefs sought for in W.P (C) No.4947/2024 cannot be granted. It is submitted that the remedy of the appellants against the award of the Arbitrator under Section 3G of the NH Act, 1956 is to file an application under Section 34 of the Arbitration and Conciliation Act, 1996 before a competent court. It is submitted that it is clear from the decision of the Supreme Court in Sterling Industries v. Jayprakash Associates Ltd and others; AIR 2019 SC 3558, that a writ petition was not maintainable challenging the award of the Arbitrator under Section 3G of the NH Act, 1956. The learned Senior Counsel points out that the appellants have already received the compensation amount awarded by the Arbitrator. The learned Senior Counsel also pointed out that it is clear from Ext.R1 (a) that the appellants had already handed over the possession of the acquired property to the National Highway Authority.
5. Learned counsel appearing for the appellants in reply would submit that where the award of the Arbitrator is not in consonance with the provisions of the NH Act, 1956, it is open to the appellants to challenge the award by filing a writ petition under Article 226 of the Constitution of India. The learned counsel would submit that this court by judgment in Ammankovil Narayanan v. District Collector, Kannur; 2023 (7) KHC 655 had set aside the award of the Arbitrator in a Writ Petition under Article 226 of the Constitution of India. The learned counsel also placed reliance on the judgment of the Supreme Court in Samudram S.V. v State of Karnataka and another; (2024) 3 SCC 623, to contend that the Court under Section 34 of the Arbitration and Conciliation Act does not have the power to modify the award and therefore the only
Ammankovil Narayanan v. District Collector
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Sterling Industries v. Jayprakash Associates Ltd and others; AIR 2019 SC 3558
The High Court cannot entertain writ petitions challenging arbitral awards after the statutory limitation period has expired, reinforcing the need for adherence to legislative intent in arbitration m....
The High Court held that challenges to arbitral awards under the National Highways Act must be pursued through statutory remedies rather than under Article 226, ensuring procedural fairness in proper....
The main legal point established in the judgment is the limitation on the authority's power to remit back the matter under Section 3(G)(5) of the National Highways Act, 1956, and the restrictions on ....
The arbitrator's authority under the National Highways Act is limited to determining compensation, and parties waive their right to object to awards if they do not raise timely challenges.
The National Highways Act, 1956 exclusively empowers the Central Government to appoint an arbitrator for determining compensation disputes, overriding general arbitration provisions.
The court clarified that under Section 34 of the Arbitration Act, the scope of review is limited to setting aside awards for patent illegality or public policy violations, not for modification.
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