[Cites 4, Cited by 0]
Karnataka High Court
National Highways Authority Of India vs Narasimappa on 26 February, 2026
-1-
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MFA No. 172 of 2022
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 26TH DAY OF FEBRUARY, 2026
BEFORE
THE HON'BLE MS. JUSTICE JYOTI M
MISCELLANEOUS FIRST APPEAL NO.172 OF 2022 (AA)
BETWEEN:
NATIONAL HIGHWAYS AUTHORITY OF INDIA
PIU-CHITRADURGA,
HAVING ITS OFFICE AT NEAR J.M.I.T.,
NH-48, (OLD NH-4), (KM.202),
CHITRADURGA-577502,
REPRESENTED BY ITS PROJECT DIRECTOR,
SRI. D SRINIVASULU NAIDU
...APPELLANT
(BY SMT. SHILPA GHANSHYAMBHAI SHAH., ADVOCATE)
AND:
1. SRI NARASIMAPPA
S/O. LATE REDDEPPA,
Digitally signed by AGED ABOUT 35 YEARS
PREMCHANDRA M R
Location: HIGH
COURT OF 2. SRI. MAREPPA
KARNATAKA S/O. LATE REDDEPPA,
AGED ABOUT 20 YEARS,
RESPONDENTS NO.1 AND 2 ARE
LEGAL REPRESENTATIVES OF
LATE REDDEPPA,
R/AT BANGARAKKANAGUDDA VILLAGE,
JAGALUR TALUK,
DAVANAGERE DISTRICT-577228.
3. THE ARBITRATOR / DEPUTY COMMISSIONER
HOSPET-CHITRADURGA SECTION OF NH 13,
-2-
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MFA No. 172 of 2022
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(OLD NO. NH 48),
DISTRICT ADMINISTRATIVE OFFICE,
HARIHAR-DAVANAGERE ROAD,
DAVANAGERE DISTRICT-577004.
4. SPECIAL LAND ACQUISITION OFFICER AND
COMPETENT AUTHORITY, NH 48,
NATIONAL HIGHWAYS AUTHORITY OF INDIA,
P.G. BUILDING, NEAR KSRTC BUS DEPOT,
CHITRADURGA DISTRICT-577502,
REPRESENTED BY ITS
SPECIAL LAND ACQUISITION OFFICER
...RESPONDENTS
(BY SRI. MANJUNATHA RAYAPPA, AGA FOR R3 AND R4;
R1 AND R2 ARE SERVED AND UNREPRESENTED)
THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER
SECTION 37(1)(c) OF ARBITRATION AND CONCILIATION ACT,
1996.
THIS MISCELLANEOUS FIRST APPEAL IS LISTED FOR
FINAL HEARING, THIS DAY, THE JUDGMENT IS DELIVERED AS
UNDER:
ORAL JUDGMENT
Smt.Shilpa Ghanshyambhai Shah., counsel for the
appellant and Sri.Manjunatha Rayappa., Additional Government
Advocate for respondents 3 and 4 have appeared in person.
Notice to respondents 1 and 2 was issued on 12.01.2023.
A perusal of the office note depicts that respondents 1 and 2
are served and unrepresented. They have neither engaged the
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services of an advocate nor conducted the case as a party in
person.
2. The appeal is filed to set aside the judgment dated
21.06.2021, passed by the Principal District and Sessions
Judge, Davanagere, in A.P.No.14/2020 as far as the direction
for the payment of solatium and the statutory interest to
respondents 1 and 2 is concerned, and consequently to restore
the Arbitral Award dated 21st August 2017, passed by the third
respondent.
3. The Central Government, for the construction of
four laning from Kms.378.200 to Kms.418.500 (Hospet to
Chitradurga Section) issued a final notification under Section
3D (1) and (2) of the National Highways Act and the same was
published in the official gazette, declaring that amongst other
lands, the lands in Survey No.19/P8 to an extent of 808 square
meters situated at the said village rest absolutely with the
Central Government, free from all encumbrances. The fourth
respondent was appointed as the competent authority under
Section 3(a) of the National Highways Act, determined the
value at Rs.2,00,000/- per acre, equivalent to Rs.49.50/- per
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square meter vide award dated 26.03.2013. Being dissatisfied
with the market value determined by respondent No.4,
Sri.Reddeppa, the owner of the acquired lands, approached
respondent No.3 seeking enhancement of compensation. The
third respondent, with a common arbitral award dated
21.08.2017, rejected the claims of the land owners, including
that of Sri.Reddeppa, thereby confirming the market value
determined by the fourth respondent.
Respondents 1 and 2, the legal representatives of Late
Sri.Reddeppa, aggrieved by the Arbitral Award, approached the
Principal District and Session Judge at Davangere by filing a
suit under Section 34 of the Arbitration and Conciliation Act,
1996 seeking setting aside the Arbitral Award and
enhancement of the compensation., which later came to be
registered as A.P.No.14/2020 and after transfer to and re-
transfer from Commercial Court to the Principal District and
Sessions Judge, Davanagare. The appellant, through its
counsel, contested the matter by way of filing a written
statement, contended that there was no scope for modification
of the arbitral award, and the relief sought in the petition was
outside the scope of Section 34 of the Arbitration Act.
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The appellant also brought to the notice of the District
Court that, as on the date of the hearing of the main
arguments, the application seeking modification of the order
dated 19.09.2019 passed by the Hon'ble Supreme Court was
still pending before the Supreme Court. The District Court after
dismissing the suit, passed further orders awarding solatium
and statutory interest on the market value determined by the
respondent No.4. Under these circumstances, the appellant has
filed the appeal on several grounds as setout in the
Memorandum of appeal.
4. Counsel for the respective parties presented several
contentions.
Counsel for the appellant placed reliance on the following
decisions:
1. SRI.H.M.SHANKARAMURTHY V/S. NATIONAL
HIGHWAYS AUTHORITY OF INDIA AND OTHERS
reported in ILR 2010 KAR 3711.
2. NATIONAL HIGHWAYS AUTHORITY OF INDIA V/S.
MAHADEVI AND OTHERS reported in 2017 (4)
KAR.L.J. 674.
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3. S.V.SAMUDRAM V/S. STATE OF KARNATAKA AND
ANOTHER reported in (2024) 3 SCC 623.
4. THE UNION OF INDIA AND ANOTHER V/S.
SRI.KOTHARI SUBBARAJU AND OTHERS reported in
MFA NO.6525/2016 (AA).
5. Heard the arguments and perused the papers with
care.
6. The facts are sufficiently said and do not require
reiteration. The core issue for determination is whether the
award of solatium and statutory interest is legally sustainable
when the primary suit has been dismissed.
7. In the present case, the lands were acquired for a
public purpose and compensation was duly awarded by the
SLAO; the arbitrator rightly rejected the petition on
21.08.2017. As the suit was dismissed, the Trial Court acted
without jurisdiction in awarding solatium and interest.
It is a well-settled principle of law that under Section 34
of the Arbitration and Conciliation Act, 1996, the Court's
jurisdiction is confined to either upholding or setting aside an
arbitral award; it does not possess the power to modify the
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award's substantive findings. Moreover, the claimants did
not pray for the grant of solatium and statutory interest;
hence, the award of solatium and interest is untenable. In the
absence of a plea for the grant of solatium and statutory
interest, the award of the same was untenable. Needless to
observe upon dismissal of the suit, the Court became functus
officio regarding the subject matter, rendering the award of
solatium and interest is null and void.
Counsel for the appellant placed reliance on the decisions
referred to supra. But I do not think that the law is in doubt.
Each decisions turns on its own facts. The present case is also
tested in the light of the aforesaid decisions.
8. For the foregoing reasons, the appeal deserves to
be allowed and the judgment dated 21.06.2021, passed by the
Principal District and Sessions Judge, Davanagere, in
A.P.No.14/2020, as far as the direction for the payment of
solatium and the statutory interest to respondents 1 and 2 is
set aside, and the Arbitral Award dated 21st August 2017,
passed by the third respondent, is restored.
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9. Resultantly, the appeal is allowed.
Because of disposal of the appeal, interim order granted if
any stands discharged and pending interlocutory applications if
any are disposed of.
SD/-
(JYOTI M)
JUDGE
MRP
List No.: 1 Sl No.: 42
