IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3^RD DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR MISCELLANEOUS FIRST APPEAL NO. 161 OF 2022 (AA)

BETWEEN:

NATIONAL HIGHWAYS AUTHORITY OF INDIA PIU-CHITRADURGA HAVING ITS OFFICE AT NEAR J.M.I.T NH-48 (OLD NH-4) (KM.202)

CHITRADURGA-577 502 REPRESENTED BY ITS PROJECT DIRECTOR SRI. D. SRINIVASULU NAIDU …APPELLANT (BY SMT. SHILPA GHANSHYAMBHAI SHAH, ADVOCATE)

AND:

1. SRI. VENKATESH S/O MUGAPPA Digitally signed by ANJALI M AGED ABOUT 45 YEARS Location: High Court of Karnataka 2. SRI GOVINDPPA S/O MUGAPPA AGED ABOUT 35 YEARS RESPONDENTS NO.1 AND 2 ARE THE LEGAL REPRESENTATIVE OF LATE MUGAPPA RESIDING AT BANGARAKKANAGUDDA VILLAGE, JAGALUR TALUK DAVANAGERE DISTRICT-577 228

3. THE ARBITRATOR/DEPUTY COMMISSIONER HOSPET-CHITRADURGA SECTION OF NH-13, (OLD NH-48)

DISTRICT ADMINISTRATIVE OFFICE HARIHAR-DAVANAGERE ROAD DAVANAGERE DISTRICT- 577 004

4. SPECIAL LAND ACQUISITION OFFICER AND COMPETENT AUTHORITY, NH-48 NATIONAL HIGHWAYS AUTHORITY OF INDIA P.G BUILDING, NEAR KSRTC BUS DEPOT CHITRADURGA DISTRICT-577 502 REPRESENTED BY ITS SPECIAL LAND ACQUISITION OFFICER …RESPONDENTS (RESPONDENTS NO.1 TO 4 ARE SERVED AND UNREPRESENTED)

THIS MFA IS FILED UNDER SECTION 37(1)(c) OF THE ARBITRATION AND CONCILIATION ACT, AGAINST THE JUDGMENT DATED 21.06.2021 PASSED IN AP.NO.13/2020 ON THE FILE OF THE PRL. DISTRICT AND SESSIONS JUDGE, DAVANAGERE, DISMISSING THE SUIT FILED UNDER SECTION

34 OF THE ARBITRATION AND CONCILIATION ACT 1996.

THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR

ORAL JUDGMENT

This appeal is filed under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as `A & C Act) by the appellant - National Highways Authority of India (in short `the NHAI'), being aggrieved by the judgment and order dated 21.06.2021 passed in AP No.13/2020 by the Court of the Prl. District and Sessions Judge, Davanagere.

2. By the said order, the learned District Court declined to interfere with the arbitral award in so far as quantum of compensation was concerned, but, held that, the land owners are entitled to solatium and statutory interest based on binding precedent of Hon'ble Supreme Court of India.

Brief facts of the case are as under:

3. The land measuring 1212 sq.mtrs. bearing Sy.No.42/2 situated in Bangarakkanagudda Village, Jagalur Taluk, Davanagere District belonging to one late Sri Mugappa was acquired by the appellant under the provisions of the NHAI Act, for the purpose of widening of NH-13. The competent authority determined compensation at the rate of Rs.49.50 per sq. mtrs and awarded a total sum of Rs.60,000/- which was disbursed to the land owner.

4. Dissatisfied with the compensation awarded, the land owners preferred proceedings before the Arbitrator appointed under the provisions of NHAI Act. However, by the award dated 21.08.2017 the Arbitrator rejected the claim for enhancement of compensation. Thereafter, the legal representatives of the land owner filed AP No.13/20 under Section 34 of the A & C Act seeking to set aside the Arbitral award and for remand to consider enhancement of compensation and other benefits.

5. The learned District Judge after hearing both the side held that, enhancement of compensation does not fall within the permissible grounds under Section 34 of A & C Act, nevertheless held that, the land owners are entitled to solatium and interest as per law declared by the Hon'ble Supreme Court in Union of India Vs. Tarsem Singh reported in (2019) 9 SCC 304, which struck down Section 3(j) of the NHAI Act to the extent it excluded the applicability of Secs.23(1)(A), 23(2) and 28 of Land Acquisition Act, 1894 (In short `the LA Act').

6. Being aggrieved by the impugned order of granting solatium and interest, now the appellant-NHAI has preferred this appeal. The principal contention urged by the appellant herein is that, learned District Ju