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2026 Supreme(Mad) 1503

IN THE HIGH COURT OF JUDICATURE AT MADRAS
P. VELMURUGAN, K. GOVINDARAJAN THILAKAVADI, JJ.
S. Rajendran – Appellant
Versus
The Arbitrator/District Collector, Villupuram – Respondent
C.M.A. No. 3705 of 2021
Decided On : 15-04-2026

Advocates Appeared:
For the Appellant : R. Nalliyappan
For the Respondents: P. Gurunathan, Su. Srini

Narrow scope of judicial interference under Sections 34/37 of Arbitration Act in NHAI land awards; no re-appreciation of evidence.

Headnote:The National Highways Act, 1956 (Sections 3A, 3D, 3G) and Arbitration and Conciliation Act, 1996 (Sections 34, 37) govern land acquisition compensation disputes. Lands acquired for highway development were initially valued at Rs.37 per sq.mtr., enhanced 100% by arbitrator to Rs.74 per sq.mtr. after enquiry. Court found no perversity or jurisdictional error in proceedings or award upholding market value determination based on notification date under Section 3A. Issues framed: Whether arbitrator undervalued lands as house sites near amenities without proper document consideration; scope of court interference under Sections 34/37 limited to patent illegality or public policy violation. Ratio: Courts cannot re-appreciate evidence or modify awards on merits; arbitrator final on facts, claimant failed to produce substantiating documents (paras 6,9,11,12). Appeal dismissed, confirming dismissal of Section 34 application; no interference warranted.

Table of Content
1. land acquisition under nha for highway, compensation process outlined. (Para 2 , 7 , 8 , 10)
2. parties contend on land valuation and document consideration. (Para 4 , 11 , 11)
3. limited judicial review under arbitration act sections 34/37. (Para 6 , 9)
4. appeal lacks merit; award properly confirmed. (Para 13 , 14)

JUDGMENT :

K. GOVINDARAJAN THILAKAVADI, J.

1. This appeal is filed by the claimant/land owner against the fair and decreetal order dated 21.12.2020 passed in Arbitration OP.No.87 of 2017 on the file of the Principal District Judge, Villupuram.

2. The brief facts which are necessary for disposal of this appeal are as follows:

The lands in survey Nos.19/1C2, 19/1D2, 19/1F1, 19/2A, 19/2B1, 19/1B2, 19/1F1 and 19/2B1, measuring to a total extent of 3631 sq. mtr. in Chinna Salem Village, Chinna Salem Taluk, Villupuram District, belong to the appellant/land owner were acquired by the 2nd respondent for laying 4 way lane road under National Highways Authorities Act. A sum of Rs.1,34,347/- was awarded by the 2nd respondent to the appellant by fixing the land value at Rs.37/- per sq. mtr. The appellant, under protest, received the said amount and filed an application before the 1st respondent/Arbitrator on 14.03.2016. The 1st respondent conducted the enquiry and passed an Arbitration Award in proceedings in Na.Ka(Arbit) A2/11071/2016 dated 09.09.2016. Aggrieved by the same, the appellant/land owner filed an application under Section 34 of Arbitration and Conciliation Act, 1996 (herein after referred as “the Act’’) in Arb.OP.No.87/2017 before the Principal District Judge, Villupuram and the same was dismissed on 21.12.2020. Aggrieved by this, the present appeal is preferred.

3. The learned counsel for the appellant/land owner would submit that the 1st respondent/Competent Authority in the order dated 09.09.2016 has stated that the said lands are adjacent to Chinna Salem Circle, National Highways NH-68, Villupuram District and hence, the tribunal ought to have appreciated that the properties which were acquired by 3rd respondent are existing very near to the residential area, school, hotel, hospital, shopping complex , etc., and hence the same has to be valued as plotable site. Whereas, the 1st respondent, without considering the same, enhanced the compensation for all the applicants to the extent of 100% and passed the award without considering the document properly. He further submitted that the properties acquired by the 3rd respondent are house sites, hence, it is not correct to fix the value of the property at the rate of Rs.74/-per sq mtr and that the acquired property will easily fetch atleast Rs.80/- per sq. ft. The learned counsel for the appellant further submitted that the 1st respondent/District Collector/Arbitrator failed to consider the documents relied upon by the appellant/land owner for ascertaining the correct market value for the acquired lands. Further learned counsel submitted that the Learned Principal District Judge, Villupuram, failed to consider the contentions made by the appellant /land owner and erroneously dismissed the petition filed under Section 34 of the Act, warrants interference by this Court.

4. On the other hand, the learned counsel for the respondents would submit that, the lands in question were taken over by the National Highways. Thereafter, the Competent Authority (Land Acquisition), Salem, awarded a sum of Rs.1,34,347/- by fixing the land value at Rs.37/- per sq. mtr.. On an appeal by the land owner, the 1st respondent/Arbitrator, after conducting enquiry, passed an award on 09.09.2016, by enhancing the value fixed by the 2nd respondent by 100% for the acquired lands. Hence the learned counsel for the respondents contends that the award passed by the competent Authority is just and requires any interference by this Court. Therefore, prayed for dismissal of the appeal.

5. Heard on both sides, records perused.

6. The scope of interference under Section 34 and 37 of the Arbitrati

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