Karnataka High Court

The Special Land Acquistion ... vs Sri.Muthiah on 11 January, 2023

Bench: H T Prasad

                                              -1-
                                                       MFA No. 2930 of 2020




                        IN THE HIGH COURT OF KARNATAKA AT BENGALURU

                          DATED THIS THE 11TH DAY OF JANUARY, 2023

                                            BEFORE
                        THE HON'BLE MR JUSTICE H.T. NARENDRA PRASAD
                   MISCELLANEOUS FIRST APPEAL NO. 2930 OF 2020 (AA)
                   BETWEEN:

                   1.    THE SPECIAL LAND ACQUISTION OFFICER
                         COMPETENT AUTHORITY
                         NATIONAL HIGHWAY 48
                         NELAMANGALA HASSAN DIVISION
                         KUNIGAL, TUMKUR DISTRICT.

                   2.    THE PROJECT DIRECTOR
                         NATIONAL HIGHWAY AUTHORITY OF INDIA
                         PROJECT IMPLEMENTATION UNIT
                         HASSAN (WRONGLY SHOWN AS
                         KUNIGAL,TUMKUR DISTRICT)
Digitally signed
by                                                             ...APPELLANTS
DHANALAKSHMI
MURTHY
Location: High     (BY SRI.PADMANABHA HOLLA S., ADVOCATE)
Court of
Karnataka          AND:

                   1.    SRI.MUTHIAH
                         S/O LATE HANUMANTHAIAH
                         AGED ABOUT 70 YEARS
                         R/O SURAPPANAHHALI VILLAGE
                         THIPPASANDRA HOBLI
                         MAGADI TLAUK
                         RAMANAGARA DISTRICT 562120

                   2.    THE DEPUTY COMMISSIONER AND
                         ARSBITRATOR
                         RAMANAGAR DISTRICT 562159
                                -2-
                                      MFA No. 2930 of 2020




3.   THE TECHNICAL MANAGER
     N H 48, HOUSING BOARD COLONY
     KUNIGAL 572130.

                                           ...RESPONDENTS

(BY SRI.S.N.GANGADHARA., ADVOCATE
SMT. K.SHOBHA, HCGP. FOR R2
NOTICE TO R3 IS DISPENSED)
     THIS MFA IS FILED UNDER SECTION 37(1)(c) OF THE
ARBITRATION AND CONCILIATION ACT, AGAINST THE ORDER
DATED 07.01.2020 PASSED IN IA. NO.1/2018 ON THE FILE
OF THE PRL. DISTRICT AND SESSIONS JUDGE, RAMANAGARA,
ALLOWING THE PETITION FILED UNDER SECTION 34 OF
ARBITRATION AND CONCILIATION ACT.

     THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY,
THE COURT DELIVERED THE FOLLOWING:
                        JUDGMENT

This appeal is filed by the appellants under Section

37(1)(c) of the Arbitration and Conciliation Act, 1996 (for

short 'the Act') challenging the order dated 7.1.2020

passed by the Court of the Principal District and Sessions

Judge, Ramanagara in Arbitration Suit No.1/2018 filed

under Section 34 of the Act.

2. Brief facts of the case:

The respondent No.1 herein, Sri.Muthaiah is the

absolute owner of the land bearing Sy.No.29/1 measuring

MFA No. 2930 of 2020

7 guntas and Sy.No.29/6 measuring 4 guntas of land

situated at Soorappanahalli Village, Thippasandra Hobli,

Magadi Taluk, Ramanagara. The appellant-authority

herein acquired the said lands in dispute for the purpose of

construction and maintenance of National Highways under

primary notification dated 17.11.2006 issued under

Section 3A of the National Highways Act, 1956 and final

notification dated 26.10.2007 issued under Section 3D of

the National Highways Act. The Land Acquisition Officer

has passed the award on 28.6.2008 by fixing the value of

total 11 guntas of the land for a sum of Rs.80,136/-. Being

aggrieved by the same, the respondent No.1 herein

approached the Arbitrator by filing a petition under Section

3G(5) of the National Highways Act. The Arbitrator has

dismissed the petition and confirmed the award of the

Land Acquisition Officer. Being aggrieved by the same, the

respondent No.1 filed an Arbitration Suit No.1/2018 under

Section 34 of the Act before the Court of Principal District

and Sessions Judge, Ramanagara. The learned District

MFA No. 2930 of 2020

Judge has allowed the suit and modified the order of the

Arbitrator by enhancing the compensation. Being

aggrieved by the same, the appellants are before this

Court.

3. The learned counsel for the appellants submits

that against the award passed by the Arbitrator, the

parties can file an Arbitration Suit under Section 34 of the

Act before the District Court. The learned District Judge

can only confirm the order passed by the Arbitrator or set

aside the order and remand the matter to the Arbitrator,

but he has no power to modify the order passed by the

Arbitrator. In support of his contention he has relied upon

the decision of the Apex Court in the case of Project

Director, National Highways Authority of India vs.

M.Hakeem and another reported in (2021) 9 SCC 1.

Hence, he sought for allowing the appeal.

4. The learned counsel for the respondent No.1

has contended that the award passed by the Land

MFA No. 2930 of 2020

Acquisition Officer fixing the market value of the lands of

the respondent No.1 at Rs.80,136/- is on the lower side.

The Officer has not considered the market value of

property as per the guidelines issued by the Government.

Therefore, he approached the Arbitrator by filing a petition

under Section 3G(5) of the National Highways Act. The

Deputy Commissioner, who is an Arbitrator under the said

Act without application of mind has dismissed the petition

and confirmed the order of the Land Acquisition Officer.

Being aggrieved, the respondent No.1 filed an arbitration

suit under Section 34 of the Act before the Court of the

Principal District and Sessions Judge, Ramanagara. The

learned District Judge after hearing the parties and

considering the materials available on record has rightly

modified the order passed by the Arbitrator and enhanced

the compensation determined by the Land Acquisition

Officer. There is no error in the impugned order. Hence, he

sought for dismissal of the appeal.

MFA No. 2930 of 2020

5. Heard the learned counsel for the parties.

Perused the judgment of the Tribunal.

6. It is not in dispute that the respondent No.1

herein, Sri.Muthaiah is the absolute owner of the land

bearing Sy.No.29/1 measuring 7 guntas and Sy.No.29/6

measuring 4 guntas of land situated at Soorappanahalli

Village, Thippasandra Hobli, Magadi Taluk, Ramanagara.

It is also not in dispute that the said lands were acquired

by the appellant-authority for the purpose of construction

and maintenance of National Highways under primary

notification dated 17.11.2006 issued under Section 3A of

the National Highways Act, 1956 and final notification

dated 26.10.2007 issued under Section 3D of the National

Highways Act, 1956. The Land Acquisition Officer has

passed the award on 28.6.2008 fixing the value of total 11

guntas of said land for a sum of Rs.80,136/-. Being

aggrieved by the same, the respondent No.1 herein filed a

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

MFA No. 2930 of 2020

before the Arbitrator. The Arbitrator has dismissed the

petition and confirmed the award of the Land Acquisition

Officer. Being aggrieved by the same, the respondent No.1

filed an Arbitration Suit No.1/2018 under Section 34 of the

Act before the Court of Principal District and Sessions

Judge, Ramanagara. The learned District Judge has

allowed the suit and modified the order of the Arbitrator

by enhancing the compensation.

The Hon'ble Apex Court in the case of Project

Director, National Highways Authority of India vs.

M.Hakeem and another reported in (2021) 9 SCC 1,

while dealing with the powers of learned District Court in a

suit filed under Section 34 or the Act, in paragraphs 42

and 48 has held as follows:

"42. It can therefore be said that this question has now been settled finally by at least 3 decisions of this Court. Even otherwise, to state that the judicial trend appears to favour an interpretation that would read into Section 34 a power to modify, revise or vary

MFA No. 2930 of 2020

the award would be to ignore the previous law contained in the 1940 Act; as also to ignore the fact that the 1996 Act was enacted based on the UNCITRAL Model Law on International Commercial Arbitration, 1985 which, as has been pointed out in Redfern and Hunter on International Arbitration, makes it clear that, given the limited judicial interference on extremely limited grounds not dealing with the merits of an award, the 'limited remedy' under Section 34 is co-terminus with the 'limited right', namely, either to set aside an award or remand the matter under the circumstances mentioned in Section 34 of the Arbitration Act, 1996.

        XXXX
        48.   Quite      obviously       if    one   were     to

include the power to modify an award in Section 34, one would be crossing the Lakshman Rekha and doing what, according to the justice of a case, ought to be done. In interpreting a statutory provision, a Judge must put himself in the shoes of Parliament and then ask whether Parliament intended this result.

Parliament very clearly intended that no power

MFA No. 2930 of 2020

of modification of an award exists in Section 34 of the Arbitration Act, 1996. It is only for Parliament to amend the aforesaid provision in the light of the experience of the courts in the working of the Arbitration Act, 1996, and bring it in line with other legislations the world over."

7. In view of the above judgment of the Apex

Court, it is clear that the District Court in a suit filed under

Section 34 of the Act has only power either to confirm the

order passed by the Arbitrator or set aside the order and

remand the matter to the Arbitrator. But, in the case on

hand, the learned District Judge has modified the order

passed by the Arbitrator and the same is contrary to

Section 34 of the Act. Hence, the impugned order is

unsustainable.

8. Accordingly, the appeal is allowed. The order

dated 7.1.2020 passed by the Court of the Principal

District and Sessions Judge, Ramanagara in Arbitration