Himachal Pradesh High Court
Narender Kumar & Others vs Nhai & Another on 16 October, 2024
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Arbitration Case No. 607 of 2024
Date of Decision :16.10.2024
Narender Kumar & others ...... Petitioners
Versus
NHAI & another ......Respondents
Coram:
The Hon'ble Mr. Justice Bipin Chander Negi, Judge
Whether approved for reporting?1
For the petitioner : Mr. Karun Negi, Advocate.
For the respondents : Ms. Shreya Chauhan, Advocate, for respondent
No.1.
Mr. Raj Kumar Negi, Additional Advocate General,
for respondent No.2/State.
Bipin Chander Negi, Judge (oral)
The arbitral dispute arises out of the land acquisition in District
Solan, H.P. for the purpose of building (widening/ four laning etc.)
maintenance, management and operation of National Highway- 22. The
land has been acquired under the provisions of National Highways Act,
1956.
2. Arbitration case No. 607 of 2024 pertains to Award No. 17 dated
27.06.2016, with respect to the aforesaid, the petitioner had preferred a
Claim Petition No. 333 of 2017, under Section 3(g) (5) of the National
Highways Act. In the aforesaid claim petition, the arbitrator had issued
notice for 27.09.2018. Reply in the claim petition was filed on 13.05.2020.
Whether reporters of Local Papers may be allowed to see the judgment? Yes
Vide order dated 26.05.2023, it was observed that the mandate of
arbitrator had expired. Hence, the aforesaid arbitral proceedings were
kept in abeyance, till the time period for completing the arbitral
proceedings, was extended under Section 29-A.
3. From a perusal of the aforesaid, it is evident that the Reference
Petition against the award had been filed by the land owners about 5
years back.
4. The relevant extract of the provisions involved in the present lis, as
amended by the Act No 33 of 2019 w.e.f 31.08.2019, are being
reproduced here-in-below for a ready reference:-
"29-A. Time limit for arbitral award.--(1) The award in
matters other than international commercial arbitration be
made by the arbitral tribunal within a period of twelve
months from the date of completion of pleadings under sub-
section (4) of Section 23:
(2)..............
(3) The parties may, by consent, extend the period
specified in sub-section (1) for making award for a further
period not exceeding six months.
(4) If the award is not made within the period specified in
sub-section (1) or the extended period specified under sub-
section (3), the mandate of the arbitrator(s) shall terminate
unless the court has, either prior to or after the expiry of the
period so specified, extended the period: Provided that
while extending the period under this sub- section, if the
court finds that the proceedings have been delayed for the
reasons attributable to the arbitral tribunal, then, it may
order reduction of fees of arbitrator(s) by not exceeding five
per cent for each month of such delay: Provided further that
where an application under sub- section (5) is pending, the
mandate of the arbitrator shall continue till the disposal of
the said application: Provided also that the arbitrator shall
be given an opportunity of being heard before the fees is
reduced.
(5) The extension of period referred to in sub-section (4)
may be on the application of any of the parties and may be
granted only for sufficient cause and on such terms and
conditions as may be imposed by the court.
Section 23. Statements of claim and defence
(4) The statement of claim and defence under this section
shall be completed within a period of six months from the
date the arbitrator or all the arbitrators, as the case may be,
received notice, in writing, of their appointment."
The sum and substance of the aforesaid provisions is that from the
date the arbitrator receives notice the statement of claim and defence
(pleadings) shall be completed within a period of six months there from.
Further the award shall be made by the arbitral tribunal within a period of
twelve months from the date of completion of pleadings. However, the
parties may, by consent, extend the period specified for making award for
a further period not exceeding six months. If the award is not made within
the period specified or the extended period specified the mandate of the
arbitrator shall terminate unless the court has, either prior to or after the
expiry of the period so specified, extended the period. The extension may
be on the application of any of the parties .The same may be granted only
for sufficient cause and on such terms and conditions as may be imposed
by the court.
5. Having gone through the order sheets appended with the petition
carefully, this Court is pained to observe that the proceedings have been
conducted by learned Arbitrator by observing statutory provisions as are
contained in the Arbitration and Conciliation Act, 1996 more in their
breach rather than in their observance.
6. This Court is of the considered view that when the law requires a
particular act to be done in a particular manner, then the same is
mandatorily required to be followed. In the case at hand, the onus was
upon the Arbitrator to perform the task entrusted to him within the time
schedule prescribed in the statute. The delay, if any, has to be bonafide
and explainable.
7. The record appended alongwith the present petition demonstrates
that the matters were adjourned by the learned Arbitrator on numerous
occasions. This Court fails to understand, as to how the Arbitrator can
with such a callous attitude take upon the task of deciding the arbitration
proceedings knowing fully well that if the proceedings are not completed
within the time schedule mentioned in the Act, then unless the same is
extended by a Court of Law, the mandate of the Arbitrator shall stands
terminated.
8. At this juncture, it would be appropriate to refer to the
judgment of the Apex Court delivered in Cognizance for Extension of
Limitation, In re, (2022) 3 SCC 117 : (2022) 1 SCC (Cri) 580 :
(2022) 2 SCC (Civ) 46 : (2022) 1 SCC (L&S) 501, wherein the
following direction had been issued:
"5.4. It is further clarified that the period from 15-3-2020 till
28-2-2022 shall also stand excluded in computing the
periods prescribed under Sections 23(4) and 29-A of the
Arbitration and Conciliation Act, 1996, Section 12-A of the
Commercial Courts Act, 2015 and provisos (b) and (c) of
Section 138 of the Negotiable Instruments Act, 1881 and
any other laws, which prescribe period(s) of limitation for
instituting proceedings, outer limits (within which the court
or tribunal can condone delay) and termination of
proceedings."
The benefit of exclusion of the aforesaid period specified herein
above also needs to be given to the petitioners before this Hon'ble Court.
9. The Divisional Commissioner, Mandi was appointed as an
Arbitrator in the case at hand vide order dated 22.03.2012 by the Central
Government, in pursuance to sub Section 5 of the National Highways Act,
1954 for the revenue District of Shimla and Solan.
10. Be that as it may, the Court is restraining from making any further
observation in the case, save and except, that hence forth, if the Court
finds the Arbitrator to be remiss in his duties then it shall not hesitate in
invoking its powers as are enshrined in Section 29 (A) (6) of the 1996 Act
to terminate the mandate of the Arbitrator de hors the fact that the
Arbitrator happens to be appointed, in terms of the aforesaid notification,
issued by the Central Government under the National Highways Act,
1956.
11. The lands of the petitioners have been acquired and they are
entitled to fair and just compensation, if in case, the mandate of the
learned Arbitrator is allowed to be terminated on account of him having
failed to complete proceedings within time great prejudice would be
caused to the petitioners who had been fighting for their rightful claim for
years together.
12. Consequently, in view of the above the petition is allowed with the
directions to the learned Arbitrator to conclude arbitration proceedings on
or before 16.04.2025. Learned Arbitrator is impressed upon to make a
time table, indicating therein the time schedule, in terms whereof, the
parties have to move forward in the matter.
13. Petition stands disposed of, so also the pending miscellaneous
applications, if any.
(Bipin Chander Negi)
October 16, 2024 (Nisha) Judge
