Courts under Section 34 cannot re-appreciate evidence or enhance arbitral awards; must set aside and remit if perverse.

(Judgment of the Court was delivered by P.Velmurugan J.)

This Civil Miscellaneous Appeal has been filed by the National Highways Authority (NHAI) to set aside the order made in Arbitration O.P.No. 124 of 2011 dated 20.02.2020 on the file of the Principal District and Sessions Judge, Tiruvallur.

2. The learned Standing Counsel appearing for the appellants/NHAI would submit the 1^st respondent’s land was acquired by the competent authority by paying compensation of Rs.8068.80 per sq.mt and subsequently, the 1^st respondent preferred a claim before the Arbitrator and the learned Arbitrator disposed of the same by confirming the order passed by the competent authority. Challenging the same, the 1^st respondent preferred an Arbitration OP before the learned Principal District Judge, Tiruvallur seeking the relief of setting aside the arbitral award passed by the Arbitrator on the ground that the Arbitrator did not consider the documents produced by him for fixation of market value and determination of compensation, whereas, the learned Principal District Judge, traversed beyond the scope of Section 34 of the Arbitration and Conciliation Act 1996 (herein after “the said Act”) and modified the Award by enhancing the compensation. The leaned Principal District Judge has no authority to fix the market value or enhance the market value by re-appreciating the evidence by sitting as an appellate authority, which is beyond the scope of Section 34 of the said Act. If at all the learned Principal District Judge had found any perversity or patent illegality in the Award passed by the Arbitrator, he ought to have set aside the Award and remitted the matter back to the Arbitrator for fresh consideration. Enhancement made by the learned Principal District Judge providing solatium and interest in the impugned order, is legally unsustainable and beyond its power and jurisdiction. Hence, the same is liable to be set aside.

3. The learned counsel for the 1^st respondent/land owner would submit that the Arbitrator failed to consider the documents produced by the land owner which amounts to perversity and patent illegality. Therefore, the learned Principal District Judge, while deciding the O.P. considered those documents and enhanced the award. Therefore, there is no merit in this appeal.

4. Heard both sides and perused the materials available on record.

5. A reading of the order passed by the learned Principal District Judge in the Arbitration O.P. shows that the learned Principal District Judge has traversed beyond the scope and object of Section 34 of the said Act and also the relief sought for by the 1^st respondent in the Arbitration O.P. If at all the learned Principal District Judge found that the award passed by the Arbitrator is not within the scope and object of Section 34 of the said Act, at the best he ought to have set aside the award and remitted the matter back to the Arbitrator for fresh consideration and he cannot re-appreciate the evidence as an appellate authority and pass orders which amounts to patent illegality and also opposed to the public policy.

6. Therefore, this Court while exercising its power under Section 37 of the said Act finds that the order passed by the learned Principal District Judge suffers from patent illegality and therefore, the same is liable to be set aside. Accordingly, the order made in Arbitration O.P.No. 124 of 2011 dated 20.02.2020 on the file of the Principal District and Sessions Judge, Tiruvallur, is set aside.

7. Further, considering the facts that the finding of the learned Arbitrator in passing the award is perverse, the same is also set aside and the matter is remitted back to the Arbitrator and the A