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National Highways Authority Of India ... vs Sangita Sunil Patil And Others
2026 Latest Caselaw 3280 Bom

Citation : 2026 Latest Caselaw 3280 Bom
Judgement Date : 1 April, 2026

[Cites 21, Cited by 0]

Bombay High Court

National Highways Authority Of India ... vs Sangita Sunil Patil And Others on 1 April, 2026

2026:BHC-AUG:13749


                       IN THE JUDICATURE OF HIGH COURT AT BOMBAY
                                  BENCH AT AURANGABAD


                            ARBITRATION APPEAL NO. 103 OF 2025

           National Highways Authority Of India PIU Jalgaon
           Through Its Project Director Shivaji V Pawar       ...Appellant

           VERSUS

           1.    Bhaskar Ninu Zambare,
           2.    Nalini Madhukar Zambare,
           3.    Hari @ Bhushan Madhukar Zambare,
           4.    Chhaya Dnyandev Bhangale,
           5.    Pushpa Yogesh Warke,
           6.    Ramchandra Bhaskar Zambare.                  ...Original Claimants/
                                                                 Respondents
           7.    The Competent Authority Land Acquisition
                 And Sub-Divisional Officer at Bhusawal.      ...Respondent
           ...
           Advocate for Appellant : Mr. Manorkar Deepak Suresh
           Advocate for Respondents No.1 : Mr. A. P. Bhandari h/f Mr. K. M. More a/w
           Shubham Zalte
           Advocate for Respondents- Competent Authority : Mr. R. R. Bangar
           ...
                                              WITH
                            CIVIL APPLICATION NO. 8404 OF 2025
                                        IN ARBA/103/2025

                                            WITH
                            CIVIL APPLICATION NO. 13976 OF 2025
                                      IN ARBA/103/2025
                                             ...

                                          AND
                            ARBITRATION APPEAL NO. 104 OF 2025

           National Highways Authority Of India PIU Jalgaon
           Through Its Project Director Shivaji V Pawar       ...Appellant

           VERSUS

           1.    Manohar Hari Patil (died) Thr Lrs
           1.1   Laxmibai Manohar Patil,
           1.2   Pramod Manohar Patil,
           1.3   Purushottam Manohar Patil,
           1.4   Shrikrishna Manohar Patil,
           1.5   Dinkar Hari Patil,                    ...Original Claimants/
                                                                 Respondents
           2.    The Competent Authority Land Acquisition
                 And Sub-Divisional Officer at Bhusawal.      ...Respondent


                                              Page 1 of 23
                                                             Arb Appeal 103-2025, oth



...
Advocate for Appellant : Mr. Manorkar Deepak Suresh
Advocate for Respondents No.1.1 to 1.5 : Mr. A. P. Bhandari h/f Mr. K. M.
More a/w Shubham Zalte
Advocate for Respondents- Competent Authority : Mr. R. S. Sarvadnya
...
                                  WITH
                CIVIL APPLICATION NO. 8406 OF 2025
                             IN ARBA/104/2025

                                WITH
                CIVIL APPLICATION NO. 13977 OF 2025
                          IN ARBA/104/2025
                                 ...

                              AND
                ARBITRATION APPEAL NO. 106 OF 2025

National Highways Authority Of India PIU Jalgaon
Through Its Project Director Shivaji V Pawar        ...Appellant

VERSUS

1.    Sangita Sunil Patil,
2.    Nilima Damodhar Warade,                       ...Original Claimants/
                                                       Respondents
3.    The Competent Authority Land Acquisition
      And Sub-Divisional Officer at Bhusawal.       ...Respondent
...
Advocate for Appellant : Mr. Manorkar Deepak Suresh
Advocate for Respondents No.1 : Mr. A. P. Bhandari h/f Mr. K. M. More a/w
Shubham Zalte
Advocate for Respondents- Competent Authority : Mr. R. R. Bangar
...
                                  WITH
               CIVIL APPLICATION NO. 13979 OF 2025
                             IN ARBA/106/2025

                                WITH
                 CIVIL APPLICATION NO. 8410 OF 2025
                          IN ARBA/106/2025
                                 ...

                              AND
                ARBITRATION APPEAL NO. 108 OF 2025

                                  Page 2 of 23
                                                                Arb Appeal 103-2025, oth




National Highways Authority Of India PIU Jalgaon
Through Its Project Director Shivaji V Pawar            ...Appellant

VERSUS

1.    Ganesh Nivrutti Varade,                           ...Original Claimant/
                                                           Respondent
2.    The Competent Authority Land Acquisition
      And Sub-Divisional Officer at Bhusawal.           ...Respondent


...
Advocate for Appellant : Mr. Manorkar Deepak Suresh
Advocate for Respondents No.1 : Mr. A. P. Bhandari h/f Mr. K. M. More a/w
Shubham Zalte
Advocate for Respondents- Competent Authority : Mr. R. D. Sanap
...
                                  WITH
                CIVIL APPLICATION NO. 8414 OF 2025
                             IN ARBA/108/2025

                                WITH
                CIVIL APPLICATION NO. 12518 OF 2025
                          IN ARBA/108/2025
                                 ...

                                CORAM            : ARUN R. PEDNEKER, J.
                                Dated            : April 01, 2026

JUDGMENT :

1. By the present Arbitration Appeals, the appellant - National Highway

Authority of India has challenged the order passed by the learned Principal

District Judge under Section 34 of the Arbitration and Conciliation Act,

1996, whereby the application filed by the appellant under Section 34 of

the said Act came to be rejected and the arbitral award passed by the

learned Arbitrator under Section 3G(5) of the National Highways Act, 1956

Arb Appeal 103-2025, oth

came to be confirmed.

2. Since all the Arbitration Appeals involve common questions of fact

and law, they are taken up together for hearing and are being disposed of

by this common judgment.

3. For the sake of convenience, the facts in Arbitration Appeal No.103

of 2025 alone are referred to. The brief facts of the appeal are as under :

The National Highways Authority initiated acquisition proceedings for

the purpose of widening National Highway No.6 from Jalgaon, Maharashtra

to the Gujarat boundary. A notification under Section 3A of the National

Highways Act, 1956 was issued on 11/11/2011. The said notification was

published in the newspapers pursuant to communication dated 30/12/2011

and the public notice was published on 23/01/2012. Subsequently, a

declaration under Section 3D of the said Act was issued on 10/10/2012.

4. The Competent Authority for Land Acquisition (CALA) thereafter

passed an award determining compensation at the rate of Rs.340/- per

square meter. In addition thereto, compensation to the extent of 10% of

the amount was granted towards easementary rights. The lands were

classified into two groups, wherein the lands situated at village Kothali and

village Muktainagar were treated as belonging to the same group.

Arb Appeal 103-2025, oth

5. Being dissatisfied with the amount of compensation awarded by the

Competent Authority, the claimants preferred arbitration proceedings

under Section 3G(5) of the National Highways Act seeking enhanced

compensation as well as statutory benefits under Section 3G(7)(a) to (d) of

the Act.

6. Before the Arbitrator, the claimants relied upon several sale

instances and led evidence in support of their claim. The relevant sale

deeds relied upon are as under:

(I) Sale Deed No.1674 of 2005 dated 22/11/2005 showing

consideration at the rate of Rs.3022/- per square meter in respect of

Plot No.7 from land Gut No.562 situated at village Muktainagar.

(ii) Sale Deed No.217 of 2010 dated 25/01/2010 showing

consideration at the rate of Rs.3375/- per square meter in respect of

land Gut No.1075 situated at village Muktainagar.

(iii) Sale Deed No.331 of 2012 dated 13/02/2012 showing

consideration at the rate of Rs.4000/- per square meter in respect of

land Gut No.542/1 and 543, Plot No.40 situated at village

Muktainagar.

Apart from the above sale deeds, other sale instances pertaining to

nearby villages were also placed on record.

7. Upon appreciation of the material on record, the learned Arbitrator

Arb Appeal 103-2025, oth

held that the registered sale deed dated 13/02/2012 was the most

proximate in point of time and therefore could be relied upon for

determination of market value. The Arbitrator further held that the

claimants were entitled to compensation for severance and loss of property

in terms of Section 3G(7)(b) and Section 3G(7)(c) of the National Highways

Act. Accordingly, by award dated 26/07/2021 the Arbitrator granted

enhanced compensation at the rate of Rs. 2800/- per square meter.

8. Being aggrieved by the said arbitral award, the appellants preferred

an application under Section 34 of the Arbitration and Conciliation Act

before the learned District Judge challenging the award. The said

application came to be dismissed. Hence, the present appeals under

Section 37 of the Arbitration and Conciliation Act have been filed.

9. The learned counsel Mr. D. S. Manorkar for the appellants has

challenged the arbitral award as well as the order passed under Section 34

on the following grounds:

(I) Illegal reliance on post-notification sale deed

It is contended that the Arbitrator committed patent illegality by

relying upon the post-notification sale deed bearing No.331 of 2012 dated

13/02/2012. According to the appellants, under Section 3G(7)(a) of the

National Highways Act, the market value of the land is required to be

determined as on the date of notification under Section 3A of the Act,

Arb Appeal 103-2025, oth

which in the present case was issued on 11/11/2011. Since the sale deed

relied upon by the Arbitrator is subsequent to the said notification, the

same ought not to have been considered for determination of

compensation.

(II) Comparison of dissimilar properties

It is further contended that the Arbitrator erroneously compared

dissimilar properties. The lands of the claimants are agricultural lands

situated at village Kothali, which is about one kilometer away from

Muktainagar. However, the Arbitrator relied upon transactions relating to

commercial plots situated within the municipal limits of Muktainagar. It is

also submitted that the Arbitrator failed to consider the "size factor", as

the sale instance relied upon pertains to a very small plot.

(III) Illegality in awarding interest

It is further submitted that the Arbitrator awarded interest at the rate

of 9% per annum from 10/10/2012, though the possession of the acquired

land was taken only after the award passed by the Competent Authority on

09/05/2013. Placing reliance on the judgment of the Supreme Court in R.

L. Jain vs. Delhi Development Authority & others reported in

(2004) 4 SCC 79 it is contended that interest is payable only from the

date of taking physical possession and not from the date of notification.

Arb Appeal 103-2025, oth

(IV) Award of compensation without evidence

It is further contended that the Arbitrator awarded compensation at

the rate of Rs.280/- per square meter towards severance and Rs.246/- per

square meter towards loss of easementary rights without there being any

documentary evidence such as panchanama or other material to establish

such loss. According to the appellants, the claimants failed to lead any

evidence to show that they suffered any injury to other immovable

property or loss of earnings due to the acquisition.

10. The learned Counsel for the appellant further submitted that the

District Court failed to exercise its jurisdiction under Section 34 of the

Arbitration Act to set aside the arbitral award.

11. Per contra, the learned Counsel Mr. A. P. Bhandari holding for Mr.

K. M. More appearing for the respondent/claimants relied upon the

judgment of the Hon'ble Supreme Court in Chimanlal Hargovinddas v.

Special Land Acquisition Officer reported in AIR 1988 SC 1652,

particularly para 4, clause (9) of the judgment, and submitted that even

post-notification sale deeds can be relied upon unless it is specifically

pleaded that the prices mentioned therein are inflated or the transaction

itself is challenged as not genuine. He further submitted that the sale deed

relied upon by the Arbitrator is executed only about three weeks after the

notification and there is no evidence to suggest that the price mentioned

Arb Appeal 103-2025, oth

therein is inflated. The sale deed is bona fide and has not been challenged

by the NH Authority on the grounds of fraud or inflation.

12. As regards the compensation towards easementary rights is

concerned, it is submitted that the Competent Authority for Land

Acquisition (CALA) itself granted compensation to the extent of 10%

towards easementary rights in accordance with the statutory mandate, and

the Arbitrator has granted consequential relief in consonance with the

enhanced compensation.

13. As regards compensation for loss of profit and severance in terms of

Section 3 G (7) (b) and (c) of the National Highways Act, 1956, it is

submitted that the claimants have specifically stated in their affidavit that

they have suffered losses on account of the acquisition, and the said

statement has not been controverted by the National Highways Authority.

14. Apart from the above submissions, the learned Counsel for the

respondent further submits that there were several other acquisition

proceedings pertaining to the same notification dated 11/11/2011. In one

such case, land bearing Gut No.453 of village Muktainagar came to be

acquired and compensation was awarded at the rate of Rs.3200/- per

square meter on the basis of a registered sale deed dated 13/02/2012. In

Arb Appeal 103-2025, oth

the said proceedings also, compensation was awarded towards

easementary rights as well as for loss of business. The said awards were

challenged by the Authority, however, the challenge failed and the same

was also not accepted by this Court. It is submitted that in respect of about

36 such cases, the awards have already been satisfied by the appellant.

15. The learned Counsel for the respondent, therefore, submits that once

the Arbitrator has passed the award on the basis of relevant considerations

and material placed on record, and the same has been confirmed by the

Court while exercising jurisdiction under Section 34 of the Arbitration Act,

this Court, in exercise of powers under Section 37 of the Arbitration Act,

would be slow in interfering with the same.

16. In support of the above submissions, reliance is placed upon the

judgments of the Hon'ble Supreme Court in Associate Builders v. Delhi

Development Authority reported in AIR 2015 SC 620 and PSA Sical

Terminals Pvt. Ltd. v. Board of Trustees of V.O. Chidambaranar Port

Trust, Tuticorin reported in (2023) 15 SCC 781.

17. Having considered the rival submissions, the first question that

arises for consideration before this Court is whether the Arbitrator could

have relied upon the sale deed dated 13/02/2012 or whether there is any

legal bar in relying upon the said sale deed.

Arb Appeal 103-2025, oth

18. The Hon'ble Supreme Court in Chimanlal Hargovinddas (Supra)

has laid down the parameters to be considered while determining

compensation. It has been observed that while determining market value,

various factors are required to be taken into consideration and one of such

factors is that even post-notification sale instances can be taken into

account if (i) they are very proximate in point of time, (ii) they are genuine

transactions, and (iii) the acquisition itself has not motivated the purchaser

to pay a higher price on account of the resultant improvement in

development prospects.

19. The said principle has also been followed by this Court in Goa

Industrial Development Corporation v. Maria Tereza N. Quadros

reported in 2016(3) All MR 810 and in Pandurang Ramrao

Somvanshi v. State of Maharashtra reported in 2025 BHC (AUG)

14723.

20. Considering the aforesaid judgments, there is no absolute bar in

taking into consideration a post-notification sale deed; however, the

market value is required to be determined with reference to the date of the

notification. Applying the principles laid down in Chimanlal

Hargovinddas (supra), it can be seen that the sale deed relied upon by

the Arbitrator is executed merely about three weeks after the notification.

Arb Appeal 103-2025, oth

There is no evidence on record to indicate that the sale price mentioned

therein is inflated and the transaction itself has not been challenged as not

being genuine. There is also no contest as regards the bona fide nature of

the said sale deed.

21. Even if the other sale deeds placed on record (noted at para 6

above) are considered and the prices therein are suitably adjusted for

yearly escalation, the resultant price would broadly correspond with the

price reflected in the sale deed dated 13/02/2012.

22. In such circumstances, when the Arbitrator has relied upon the said

sale deed dated 13/02/2012 for determination of compensation and the

District Court, while exercising jurisdiction under Section 34 of the

Arbitration Act, has not interfered with the same, this Court, while

exercising appellate jurisdiction under Section 37 of the Arbitration Act,

would be slow to interfere with the determination of compensation based

on the sale deed dated 13/02/2012.

23. As regards the compensation towards easementary rights is

concerned, the same was initially granted by the Competent Authority for

Land Acquisition (CALA) and the said grant was not specifically challenged

by the National Highways Authority while contesting the enhancement of

the market value of the land. Consequently, upon enhancement of the

Arb Appeal 103-2025, oth

compensation for the acquired land, there would naturally be a

corresponding increase in the total amount payable towards loss of

easementary rights. Similarly under Section 3 G (7)(c) compensation is

also granted by CALA.

24. As regards the grant of compensation under Section 3G(7)(b) and (c)

of the National Highways Act, 1956, it is to be noted that the claimants

have made specific statements in their affidavits regarding the losses

suffered by them on account of the acquisition. In the case of Krishna

Balchandra Hadfadkar and Ors. vs. Special Land Acquisition Officer

and The Managing Director, reported in MANU/MH/0159/2013, this

Court has held that even if the issue of severance is not raised or framed,

the same has to be considered if the facts justify severance. This Court in

Krishna (supra) has observed as under :

"22. it is true that in the reference application, the applicants had not claimed compensation towards severance charges. It is also true that no issue was framed int hat regard. However, the fact remains that due evidence was led by the applicants on this aspect. In the case of "Caetano Jose Filomeno (Dr.)"

(supra), this Court has held that the question of severance of land was liable to be considered even if no such issue was framed and even if no such plea was taken by the applicant in his application for reference."

25. Similarly in the case of Dr. Caetano Jose Filomeno Jacinto de

Arb Appeal 103-2025, oth

Loiola Pereira vs. Deputy Collector, South, Sub-Division and Ors.,

reported in 2005 (1) All MR 797, this Court at paragraph No.22 held as

under :

"22. The next grievance made on behalf of the applicant is that by the present acquisition their remaining property of survey No.363/1 was severed as a result of which it has now remained landlocked without there being any access. The applicant in his evidence before the Court had stated that in view of the acquisition the property under survey No.363/1 remained blocked without any access. There is no doubt that no issue on this aspect was framed by the Court nor such a plea was taken by the applicant in his application for reference. Nevertheless if the Court is required to determine the market value of the acquired land by sitting, on the armchair of a willing purchaser and in our view it is right so, this factor certainly ought to have been considered by the learned Trial Court. Shri Noronha has placed reliance on several decisions regarding this aspect of the case. In Government v. The Century Spinning and Manufacturing Co. Ltd. MANU/MH/0092/1941 : A.I.R.1942 Bom 105 wherein this Court observed that when large proportion of frontage is acquired and a relatively small amount of frontage is left with the owner of the remaining land, he is entitled to some compensation in respect of severance. Reliance has also been placed on the case of Radhey Shyam v. Haryana State MANU/PH/0155/1981 wherein it is observed that the claimants were entitled to compensation for severance. In the case of Smt. Kasturi Devi an Ors. vs. The Collector, Nainital MANU/UP/0607/1982: A.I.R. 1983 All 338 after the acquisition

Arb Appeal 103-2025, oth

of 20,000 Sq. ft. of land the remaining area was deprived of frontage on the road and a Division bench of that Court observed that this would certainly diminish the value of the land to some extent. However, no evidence was produced to show as to what extent the value of the remaining land had diminished, but still the Court held, that it was difficult to hold that severance of the disputed land had diminished the value of the remaining land and in the absence of positive evidence, the Court considered to award Rs.2000/- as damages sustained by the applicants on account of severance of land. Int he case of Amirbibi and Ors. vs. Special Land Acquisition officer, MANU/GJ/0146/1984: AIR1981 Guj 219 a division bench of that court stated that it could not be laid down as a rule of law that where expert assistance is not available and where a reasonable guess can be made form whatever evidence there is on record, the Court would be precluded form doing so only because the expert evidence is not led in a particular case. The Court further felt that damage suffered by the claimants could not go uncompensated altogether and that they should make their best endeavour to meet out justice to them, although they must be on guard while doing so, as their conclusion must be based on a broad basis and commonsense inference. The Court therefore proceeded after considering pros and cons of the questions to award compensation for injurious affection to Rs.2/- per sq. metre as it would serve the purpose."

26. The Arbitrator has considered the uncontroverted affidavits and the

evidence while determining the compensation. It is evident that the lands

Arb Appeal 103-2025, oth

of the claimants were not acquired in their entirety, but only partially for

the purpose of widening or expansion of the National Highway. This

position is also reflected in their claim applications filed before the CALA.

Each of the claimants specifically raised the issue of severance

before the CALA, and the same is duly recorded in the CALA awards. For

ready reference, one such objection and the corresponding finding are set

out in the table below -

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                                                                  P;k
                                                                  fno'kh
                                                                  d½
                                                                  lquko.kh
                                                                  P;k
                                                                  fno'kh
                                                                  uarj

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                xV ua-      ukjk;.k     laHkkO; fcu'ksrh Lo#ikph vWMOgksds vtZnkj @
               110@1        taxys oxSjs vlwu laikfnr {ks=kl pkyw V Jh- odhy xSjgtj-

jk- dksFkGh cktkj Hkkokus o izfr pkS- ok- ,- 1½ gjdrhr rk- eh- #-3000@& njkus egktu uewn ekx.;kaaP;k eqDrkbZuxj uqdlku HkjikbZ o ih- iq"B~;kFkZ ns.ksr ;koh- feGdr lh- dks.krkgh iqjkok okf.kT; {kersph vkgs pkS/kjh tksMysyk ukgh Eg.kwu pkS-QqV njkus@ pkyw ;kaps R;keqGs gjdr cktkj Hkkokus uqdlku odhyi= QsVkG.ksr ;sr HkjikbZ feGkoh- vkgs-

                                        2½ va'kr% {ks=                     2½ feGdrhps


                                                                   Arb Appeal 103-2025, oth



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                                     voewY;u y{kkr ?ksrk               laiknu gksmqu
                                     R;kph ;ksX; rh uqdlku             uqdlku HkjikbZ
                                     HkjikbZ feGkoh-                   ns.ksph dk;|kr
                                     3½ laiknu {ks=krhy                rjrqn ulysys
                                     ihOghlh ikbZiykbZu ¼fofgj         gjdr QsVkG.ksr
                                     1@2 fgLlk½ ;kaps                  ;sr vkgs-
                                     ewY;kadu gksmqu uqdlku            3½ la;qDr
                                     HkjikbZ ns.ksr ;koh-              ekst.kh i=dkr
                                     4½ tkxsps @                       uewn
                                     cka/kdkekps ,dq.k                 ikbZiykbZups
                                     fdaerhoj 10% ofgokV               ewY;kadu gksmqu
                                     jDde ns.ksr ;koh-                 uqdlku HkjikbZ
                                     5½ Hkwlia knu dk;nk               ns.ksr ;sbZy-
                                     1894 ps rjrqnhuqlkj               4 o 5½
                                     tfeuhps@cka/kdkekps ,dq.k         tkxsps@
                                     jdesoj 30% fnykl                  cka/kdkekps
                                     jDde o ;ksX; rs dkWiksuaV         fdaerhoj 10%
                                     ns.ksr ;kos-                      ofgokVhph
                                     6½ jk"Vªh; egkekxZ                jDde ns.ks]
                                     vf/kfu;e 1956 ps                  Hkwlia knu dk;|
                                     dye 3Mh e/khy                     kP;k rjrqnhuqlkj
                                     rjrqnhuqlkj ;ksX; rh              tfeuhps @
                                     uqdlku HkjikbZ                    cka/kdkekps
                                     ns.ksr ;koh-                      jdesoj 30%
                                                                       fnyklk jDde
                                                                       @ dkWaiksuaV
                                                                       ns.ksph dk;|kr
                                                                       rjrwn ulysus
                                                                       gjdrh
                                                                       QsVkG.ksr ;sr
                                                                       vkgs-
                                                                       6½ cktkj
                                                                       Hkkokizek.ks
                                                                       ewY;kadu
                                                                       Bjforkauk
                                                                       dk;ns'khj
                                                                       i/nrhpk voyac
                                                                       dj.ksr ;s.kkj
                                                                       vkgs-


27. The acquisition for widening of road takes place of a large strip of

land, generally narrow in width, affecting only a portion of larger land

Arb Appeal 103-2025, oth

holdings belonging to several land owners. As a result, such acquisition

may cause severance and may also adversely affect the usability and

economic utility of the remaining land. The Arbitrator, taking into

consideration the affidavits and statements of the claimants as well as the

nature of the acquisition, has granted compensation towards severance.

28. The power of the 'Court' to interfere with arbitral award under

Section 34 and of this Court under Section 37 of the Arbitration Act needs

to be noted before considering the above submissions on merits of arbitral

award. The Supreme Court in the case of PSA Sical Terminals Private

Limited Vs. Board of Trustees of V.O. Chidambaranar Port Trust

Tuticorn and Anr. reported in (2023) 15 SCC 781 has observed that it

is a settled legal position, that in an application under Section 34, the court

is not expected to act as an appellate court and reappreciate the evidence.

The scope of interference would be limited to grounds provided under

Section 34 of the Arbitration Act. The interference would be so warranted

when the award is in violation of "public policy of India", which has been

held to mean "the fundamental policy of Indian law". A judicial intervention

on account of interfering on the merits of the award would not be

permissible. However, the principles of natural justice as contained in

Section 18 and 34(2)(a)(iii) of the Arbitration Act would continue to be the

grounds of challenge of an award. The ground for interference on the basis

that the award is in conflict with justice or morality is now to be understood

Arb Appeal 103-2025, oth

as a conflict with the "most basic notions of morality or justice". It is only

such arbitral awards that shock the conscience of the court, that can be set

aside on the said ground. An award would be set aside on the ground of

patent illegality appearing on the face of the award and as such, which

goes to the roots of the matter. However, an illegality with regard to a mere

erroneous application of law would not be a ground for interference.

Equally, reappreciation of evidence would not be permissible on the ground

of patent illegality appearing on the face of the award.

29. The Hon'ble Supreme Court in PSA Sical Terminals Private

Limited (supra) has further observed that a decision which is perverse,

though would not be a ground for challenge under "public policy of India",

would certainly amount to a patent illegality appearing on the face of the

award. However, a finding based on no evidence at all or an award which

ignores vital evidence in arriving at its decision would be perverse and

liable to be set aside on the ground of patent illegality.

30. To appreciate the test of perversity, the Hon'ble Supreme Court in

PSA Sical Terminals Private Limited (supra) in para 42 has further held

as under :-

"42. To understand the test of perversity, it will also be appropriate to refer to paragraph 31 and 32 from the judgment of this Court in Associate Builders (supra), which read thus:

Arb Appeal 103-2025, oth

31. The third juristic principle is that a decision which is perverse or so irrational that no reasonable person would have arrived at the same is important and requires some degree of explanation. It is settled law that where:

(i) a finding is based on no evidence, or

(ii) an Arbitral Tribunal takes into account something irrelevant to the

decision which it arrives at; or

(iii) ignores vital evidence in arriving at its decision,

such decision would necessarily be perverse.

32. A good working test of perversity is contained in two judgments. In Excise and Taxation Officer-cum-Assessing Authority v. Gopi Nath & Sons [1992 Supp (2) SCC 312], it was held:

"7. ... It is, no doubt, true that if a finding of fact is arrived at by ignoring or excluding relevant material or by taking into consideration irrelevant material or if the finding so outrageously defies logic as to suffer from the vice of irrationality incurring the blame of being perverse, then, the finding is rendered infirm in law."

In Kuldeep Singh v. Commr. of Police (1999) 2 SCC 10, it was held:

"10. A broad distinction has, therefore, to be maintained between the decisions which are perverse and those which are not. If a decision is arrived at on no evidence or evidence which is thoroughly unreliable and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, howsoever compendious it may be, the conclusions would not be

Arb Appeal 103-2025, oth

treated as perverse and the findings would not be interfered with."

31. The Hon'ble Supreme Court at para 14 in the case of MMTC Limited

Vs. Vendanta Limited reported in (2019) 4 SCC 163 has further

observed that as far as interference with an order made under Section 34,

as per Section 37, is concerned, it cannot be disputed that such

interference under Section 37, cannot travel beyond the restrictions laid

down under Section 34. In other words, the Court cannot undertake an

independent assessment of the merits of the award, and must only

ascertain that the exercise of power by the Court under Section 34 has not

exceeded the scope of the provision. Thus, it is evident that in case an

arbitral award has been confirmed by the Court under Section 34 and by

the Court in an appeal under Section 37, this Court must be extremely

cautious and slow to disturb such concurrent findings.

32. As observed in above noted Judgment of Supreme Court i.e. PSA

and M.M.T.C., (Supra) the power of this Court to interfere with an arbitral

award is extremely limited. Unless the award suffers from patent illegality

or falls within the limited grounds contemplated under Section 34 of the

Arbitration and Conciliation Act, 1996, interference would not be

warranted. The scope of interference becomes even narrower while

Arb Appeal 103-2025, oth

exercising appellate jurisdiction under Section 37 of the said Act.

33. This Court has also taken into consideration that in respect of the

same acquisition proceedings, several other awards have attained finality

on account of delay in filing application under Section 34 of the Act.

34. Considering the totality of the circumstances, this Court is of the

opinion that no case is made out for interference with the award passed by

the Arbitrator. The Arbitrator has assessed the value of the land

considering the relevant material before him and has granted

compensation for severance, loss of business, and loss of easementary

rights. The same is based on the material on record and is in accordance

with the law as noted in the above-referred judgments of this Court.

Consequently, while exercising jurisdiction under Section 37 of the

Arbitration and Conciliation Act, 1996, this Court finds no reason to

interfere with the impugned judgment under Section 34 and the award,

passed by the Arbitrator.

35. In view of the orders passed in all the arbitration appeals today, all

civil applications seeking withdrawal of amounts are allowed. However,

since the National Highway Authority intends to challenge this order, the

Arb Appeal 103-2025, oth

applicants shall furnish an undertaking to this Court stating that, in the

event any favourable order is passed in favour of the National Highway

Authority, they will redeposit the amount withdrawn within a period of four

weeks.

36. All other pending applications for interim relief/ stay stand disposed

of.

( ARUN R. PEDNEKER, J. )

vj gawade/-.

 
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