Case title:
National Highways Authority of India Vs P. Nagaraju @ Cheluvaiah
Date of Order:
11/07/2022
Bench:
Justices Indira Banerjee and AS Bopanna
Parties:
National Highways Authority of India – Petitioner
P. Nagaraju @ Cheluvaiah – Respondent
Subject
It was observed by the Supreme Court that an award passed by an Arbitrator under Section 34 or 37 of the Arbitration and Conciliation Act to either of the parties can be set aside by a court but can never be changed.
Facts
- The High Court of Karnataka, Bengaluru's decision upholding the awards made by the Deputy Commissioner and Arbitrator of National Highway 275 (land acquisition) and the Deputy Commissioner-1 and Arbitrator of Bengaluru Urban District was the subject of appeals brought by the National Highways Authority of India ('NHAI').
- By the aforementioned awards, the respective Arbitrators increased the compensation from what the Special Land Acquisition Officer (SLAO) had set at Rs.2026 per square metre and Rs.17,200 per square metre to Rs.15,400 per square metre and Rs.25,800 per square metre, respectively.
Arguments Advanced by the Petitioner
- The argument in this appeal was that the arbitrator's decision was ex-facie incorrect and clearly illegal because, in recalculating the compensation, the arbitrator took into account the guideline value specified in the notification dated 28.03.2016 released by the Department of Stamps and Registration, that is noticeably the market value fixed on a date after the 01.02.2016 acquisition notification.
Issues Raised
- If the market value provided as a guideline value in the notification dated 28.03.2016 was properly taken into account by the arbitrator, and if so, whether the ways in which the said guideline was properly considered deprived the NHAI of an opportunity and violated the principles of natural justice in contravention of Section 28. (2).
- If the guideline value determined in relation to "City Greens" and "Zunadu" being implemented inevitably to the property impugned was legitimate and if the learned Arbitrator has suggested valid grounds to place such reliance because the failure to assign reasons or engage in the discussion will also equate to patent illegality and be in violation of Section 31(3) of Act, 1996.
Judgment
- On the first point, the court decided that the Arbitrator had not clearly violated any laws by relying on the guideline value notice dated 28.03.2016 to determine the market price of the property obtained under the initial notification dated 01.02.2016.
- Regarding the other arguments, the bench noted that the Arbitrator had not provided sufficient justification for his decision to unanimously adopt the value of Rs. 15,400 per square meter set in regard to lands in a pattern that was specifically included in the notification.
Conclusion
It was ruled by the Supreme Court that a court can set aside the compensation decided by the arbitrator entirely but cannot modify the amount.
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