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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
SATYEN VAIDYA, J.
Ram Lal & Anr. - Appellants
Versus
National Highways Authority of India & Anr. - Respondents
Arbitration Appeal No. 2 of 2023 along with Arbitration Appeals Nos. 3, 4, 5, 6, 7, 8, 10, 12, 13, 14 and 15 of 2023
Decided On : 13-06-2023
National Highways Act, 1956 - Section 3A, G(5) - Arbitration and Conciliation Act, 1996 - Section 34 - Land Acquisition Act 1894 - Section 18 - Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - Sections 26 to 28 - Land Acquisition - Arbitral award - Enhancement of compensation - Appellants seeking enhancement of compensation - Arbitrator had not made his objective assessment as to market value of land by considering parameters prescribed under Sections 26 to 28 of 2013 Act. - Para 18
Finding of the Court :
Market value of land is to be assessed from view point of proposed seller and not of proposed purchaser - Award passed by learned Arbitrator suffered from patent illegality inasmuch as it had completely rejected a piece of evidence from being consideration and secondly its findings while drawing distinction between potentiality of acquired land of revenue estate Alsu and Village Dehar was either on personal knowledge of learned Arbitrator or his assumption, for no material or evidence had been made basis for such findings - Additionally, learned Arbitrator had not made his objective assessment as to market value of land by considering parameters prescribed under Sections 26 to 28 of 2013 Act - Award passed by learned Arbitrator required interference by learned District Judge being patently illegal - Accordingly, common judgment passed by learned District Judge and award passed by learned Arbitrator are set aside.
Result : Appeals disposed of.
JUDGMENT :
Satyen Vaidya, J.
All these Arbitration Appeals No. 2, 3, 4, 5, 6, 7, 8, 10, 12, 13, 14 and 15 of 2023 were heard and are being decided together as these arise from a common judgment passed by learned District Judge, Mandi. Additionally common questions of facts and law are also involved in all these appeals. The chronology and details of the matters included here are as under:-
| Sr. No. | Arbitration Appeal Number | Title | Particulars of the petition before the District Judge, Mandi. | Particulars of the case before the Arbitrator. |
| 1. | 2 of 2023 | Ram Lal vs. NHAI & Anr. | Arb. Pet. No. 18 of 2022. | Arb. Case No. 708 of 2015. |
| 2. | 3 of 2023 | Fulla Devi vs. NHAI & Anr. | Arb. Pet. No. 19 of 2022. | Arb. Case No. 712 of 2015. |
| 3. | 4 of 2023 | Amar Chand vs. NHAI & Anr. | Arb. Pet. No. 15 of 2022. | Arb. Case No. 711 of 2015. |
| 4. | 5 of 2023 | Sunder Lal vs. NHAI & Anr. | Arb. Pet. No. 9 of 2022 | Arb. Case No. 710 of 2015. |
| 5. | 6 of 2023 | Kamal Kumar vs. NHAI & Anr. | Arb. Pet. No. 16 of 2022. | Arb. Case No. 709 of 2015. |
| 6. | 7 of 2023
| Mangat Ram vs. NHAI | Arb. Pet. No. 13 of 2022. | Arb. Case No. 834 of 2015. |
| 7. | 8 of 2023 | Nand Lal vs. NHAI & Anr. | Arb. Pet. No. 14 of 2022. | Arb. Case No. 713 of 2015. |
| 8. | 10 of 2023 | Gangi Devi & Ors. vs. NHAI & Anr. | Arb. Pet. No. 17 of 2022 | Arb. Case No. 705 of 2015. |
| 9. | 12 of 2023 | Vidya Sagar vs. NHAI & Anr. | Arb. Pet. No. 5 of 2022. | Arb. Case No. 707 of 2015. |
| 10. | 13 of 2023 | Shiv Ram & Ors. vs. NHAI & Anr. | Arb. Pet. No. 6 of 2022. | Arb. Case No. 832 of 2015. |
| 11. | 14 of 2023 | Nikku (deceased) through LRs. vs. NHAI & Anr. | Arb. Pet. No. 4 of 2022. | Arb. Case No. 744 of 2015. |
| 12. | 15 of 2023 | Vidya Sagar vs. NHAI & Anr. | Arb. Pet. No. 12 of 2022. | Arb. Case No. 706 of 2015. |
2. The lands of appellants have been acquired in revenue estate Alsu, Tehsil Sundernagar, District Mandi, H.P., for building, four Laning etc., maintenance, management and operation of NH-21 (Bilaspur-Nerchowk Section). Notification under Section 3A of the National Highways Act, 1956 (for short “NH Act”) was issued on 21st April, 2012. The competent authority assessed market value of the acquired land of appellants at Rs. 31 lakhs per bigha irrespective of classification and nature of the land.
3. The appellants having remained dissatisfied with the compensation offered by the competent authority, approached the Arbitrator under Section 3G(5) of the NH Act individually. They claimed compensation @ of Rs. One Crore per bigha. Reliance was placed by them on an exemplar sale transaction Ex. Px. Appellants also challenged the potentiality assessed by the competent authority and claimed parity with the adjoining revenue estate Dehar, where competent authority had offered compensation @ Rs.35 lakh per bigha and on such basis, in alternative appellants claimed the compensation at the same rate as awarded for the land in revenue estate Dehar. Benefits in terms of judgment passed by Hon'ble Supreme Court in the case of Union of India vs. Tarsem Singh reported in (2019) 9 SCC 304 were also sought.
4. Learned Arbitrator vide common award dated 29.06.2019 declined any enhancement in the compensation payable to the appellants, however, he ordered payment of solatium @30% and interest at the rate of 9% per annum thereon in favour of the appellants. Learned Arbitrator declined to countenance sale transaction Ex. Px simply on the ground that it pertained to a period which was more than one year later than the issuance of notification under Section 3-A of the Act. As regards the claim of appellants seeking parity with the treatment given to landowners of revenue estate Dehar, learned Arbitrator declined such claim also on the ground that the potential value of the land in revenue estate Dehar was better than the revenue estate Alsu for
SupremeToday
Point of Law : If arbitral award is found to be suffering from patent illegality it can surely be interfered with.
In highway acquisitions under NH Act, small sale deeds usable for large tracts with deduction (no development charges needed); adjacent similar lands comparable; no 12% interest under LAA 23(1-A) per....
Judicial interference under Arbitration Act Sections 34/37 limited to patent illegality, public policy violation, or natural justice breach; no evidence reappreciation; challenger's failure to timely....
The nature and status of the land on the date of notification must be considered in determining compensation for land acquired under the NHAI Act, 1956, and settled legal principles must be applied i....
Post-notification sale deeds admissible for compensation if proximate, genuine, uninflated; severance awards upheld on uncontroverted evidence; minimal judicial interference in arbitral awards absent....
The potential value of land, particularly its location and possible future use, is a critical factor in determining compensation for land acquisition, and arbitrators have the discretion to enhance c....
The appeal emphasized the narrow scope of intervention under arbitration law, confirming reliance on smaller land sale deeds for larger valuations with required adjustments, and clarified interest aw....
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