JUDGMENT

This appeal has been filed under Section 37 of the Arbitration and Conciliation Act, 1966, challenging the order dated 27.02.2019 passed by the learned Principal District Judge, Salem, in A.O.P. No. 146 of 2013 under Section 34 of the Arbitration and Conciliation Act, 1966, wherein the learned Principal District Judge, Salem has modified the Arbitral award dated 27.10.2003 passed by the District Collector under the National Highways Act, who has determined the compensation payable to the first respondent for the acquisition of his lands by the Appellant.

2. Under the impugned order, the learned Principal District Judge has passed the following order in A.O.P. No. 146 of 2013: “In fine the award passed by Arbitrator in proceedings Na.Ka.28/2003(B2), dated 25.08.2007 is confirmed with regard to the market value of Rs.3,14,037/- and the respondents concerned are directed to pay 12% on the supra market value per annum from the date of notification to the date of the award of the competent authority or the date of taking possession of property whichever is earlier; also directed to pay 30% solatium on the market value. The respondents are directed to pay a cost of Rs.20,000/- to the petitioner.”

3. As seen from the aforementioned order, though the learned Principal District Judge has confirmed the Arbitral award dated 27.10.2003 passed by the District Collector, in addition to that, he has modified the same by directing the Appellant to pay 12% interest on the additional market value from the date of notification to the date of the award and has also directed the Appellant to pay 30% solatium on the market value and has also directed the Appellant to pay a cost of Rs. 20,000/- (Rupees Twenty Thousand only).

4. It is now well settled as per the recent decision of the Hon'ble Supreme Court in the case of Project Director, National Highways vs. M.Hakeem and another reported in 2021 SCC Online SC 473 that an arbitral award cannot be modified by a court exercising power under section 34 of the Arbitration and Conciliation Act. The relevant paragraphs of the said decision are extracted hereunder:

"39. As has been pointed out by us hereinabove, McDermott (supra) has been followed by this Court in Kinnari Mullick (supra). Also, in Dakshin Haryana Bijli Vitran Nigam Ltd. v.Navigant Technologies Pvt. Ltd., 2021 SCC Online SC 157, a recent judgment of this Court also followed McDermott (supra) stating that there is no power to modify an arbitral award under Section 34 as follows:—

(f) In law, where the Court sets aside the award passed by the majority members of the tribunal, the underlying disputes would require to be decided afresh in an appropriate proceeding.

Under Section 34 of the Arbitration Act, the Court may either dismiss the objections filed, and uphold the award, or set aside the award if the grounds contained in sub-sections (2) and (2A) are made out. There is no power to modify an arbitral award.

40. It can therefore be said that this question has now been settled finally by at least 3 decisions of this Court. Even otherwise, to state that the judicial trend appears to favour an interpretation that would read into Section 34 a power to modify, revise or vary the award would be to ignore the previous law contained in the 1940 Act; as also to ignore the fact that the 1996 Act was enacted based on the UNCITRAL Model Law on International Commercial Arbitration, 1985 which, as has been pointed out in Redfern and Hunter on International Arbitration, makes it clear that, given the limited judicial interference on extremely limited grounds not dealing with the merits of an award, the ‘limited remedy’ under Section 34 is co-terminus with the ‘limited right’, namely, either to set aside an award or remand the matter under the circumstances mentioned in Section 34 of the Arbitration Act, 1996.

41. A look at the Arbitration Acts of England, the United States, Canada, Australia and Singapore also lead to the same conclusion. In each of th