NHAI v. Sayedabad Tea Co. Ltd. & Ors. (2009) - Special Provision Overrules General Provision

• National Highways Authority of India Vs Sayedabad Tea Co. Ltd
• Bench: Justices N.V. Ramana, Mohan M. Shantanagoudar, Ajay Rastogi
• Appellant: National Highways Authority of India
• Respondent: Sayedabad Tea Company Ltd. And Ors.

Issue

• Does Section 11 of the Arbitration And Reconciliation Act, 1996 provide for the appointment of an Arbitrator in case of failure of appointment by the Central government?
• Does Special law overpower general law?

Facts

• The appellant in discussion acquired the lands of the respondent with reference to the powers conferred under Section 3(D) of the National Highways Act, 1956 and the respondent alleged that the compensation received was not sufficient and thus moved forward for the invocation of Arbitration.
• Under Act (1956) in case of failure agreement towards a mutually acceptable compensation, an Arbitrator is appointed by the Central government and the Arbitration and Conciliation Act, 1996 Act would apply everywhere during this process.
• The respondent on the failure of appointment of an Arbitrator by the Central government moved to the court to appoint an Arbitrator where the court ordered for an appointment of the same.

Appellant's Contentions

• The counsel appearing for the appellant submitted that the respondent proceeded to the High Court even before the matter proceeded and held that it was unmaintainable since "Act" 1956 being a Special law would prevail over the general law.
• The counsel supported his submissions through the mention of one of the judgements (NHAI Vs Prakash Chand Pradhan) thus, it requested to quash the order of the HC.

Respondent's Contentions

• The respondent while supporting the judgement in this case by the HC held that if the authority under Act failed to appoint an arbitrator it was justified to take the path of applying the Chief Justice under Section 3 (G) of the "Act" 1956.
• It also held that there was no legal interference for the HC to order for the appointment of an arbitrator and also supported this with the submission of the judgement in Deep Trading Company Vs. Indian Oil Corporation and Others case.

Judgement

The court ordered for the appeals and set aside the judgement by HC also held that special provision overrules the general provisions.

Relevant Paragraphs

It is indeed true that the Arbitrator who was appointed by the Central Government subsequent to the filing of an application under Section 11 of the Act 1996 in April 2007 could not proceed after the Arbitrator was appointed pursuant to the Order impugned in the instant proceedings, who too has later recused and almost 12 years have rolled by now, we deem it appropriate to observe that there is no need to file any application by the respondent­applicant and the Central Government shall consider and appoint an Arbitrator in terms of Section 3G(5) of the Act 1956 within a period of 30 days with prior intimation to the respondents. As the litigation has consumed a sufficiently long time, we consider it appropriate to further observe that the Arbitrator so appointed by the Central Government may adjudicate and decide the dispute within a reasonable time but in no case later than six months after the respondent­applicant record its presence in the proceedings."

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