Eliyamma vs The Deputy Collector
2021 Latest Caselaw 463 Ker

              IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                 PRESENT

               THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR

                                    &

                THE HONOURABLE MR. JUSTICE K.HARIPAL

     THURSDAY, THE 07TH DAY OF JANUARY 2021 / 17TH POUSHA, 1942

                           Arb.A.No.20 OF 2016

    AGAINST THE ORDER IN AOP 51/2012 OF DISTRICT COURT, PALAKKAD


APPELLANT/PETITIONER:

             ELIYAMMA
             W/O. AVARACHAN, AGED 54 YEARS,CHEERAMPOTTA VEEDU,
             PANTHALAMPADAM,PANNIYANKARA, VADAKKANCHERRY,
             PALAKKAD DISTRICT.

             BY ADV. SRI.JACOB SEBASTIAN

RESPONDENTS/RESPONDENTS:

      1      THE DEPUTY COLLECTOR
             AND SPECIAL ACQUISITION OFFICER,L.A.N.H,
             PALAKKAD-678001.

      2      THE NATIONAL HIGHWAY AUTHORITY OF INDIA
             NEW DELHI REP. BY THE PROJECT DIRECTOR,N.H.A.I,
             PALAKKAD-678001.

             R1 SRI.RENIL ANTO KANDAMKULATHY, GOVT. PLEADER
             R2 BY SRI.THOMAS ANTONY, SC, NHAI


     THIS ARBITRATION APPEALS HAVING COME        UP FOR ADMISSION ON
06/07/2020 ALONG WITH Arb.A.21/2016, THE         COURT ON 07/01/2021
DELIVERED THE FOLLOWING:
        Arb.A.Nos.20 & 21 of 2016          :2:



               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                   PRESENT

                THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR

                                      &

                 THE HONOURABLE MR. JUSTICE K.HARIPAL

     THURSDAY, THE 07TH DAY OF JANUARY 2021 / 17TH POUSHA, 1942

                            Arb.A.No.21 OF 2016

   AGAINST THE ORDER IN AOP 305/2012 OF DISTRICT COURT, PALAKKAD


APPELLANT/PETITIONER:

              O.P.GEORGE
              S/O.POULOSE,AGED 65 YEARS,ORAVANMARIVEL,
              CHAVITTUPADAM,PANNIYANKARA,PALAKKAD DISTRICT.

              BY ADV. SRI.JACOB SEBASTIAN

RESPONDENTS/RESPONDENTS:

      1       THE DEPUTY COLLECTOR
              AND SPECIAL LAND ACQUISITION
              OFFICER,L.A.N.H.,PALAKKAD,PIN-678001.

      2       THE NATIONAL HIGHWAY AUTHORITY OF INDIA
              NEW DELHI,REPRESENTED BY THE PROJECT DIRECTOR,
              N.H.A.I,PALAKKAD,PIN-678001.

              R1 BY SRI.RENIL ANTO KANDAMKULATHY, GOVT. PLEADER
              R2 BY SRI.THOMAS ANTONY, SC, NHAI


     THIS ARBITRATION APPEALS HAVING COME         UP FOR ADMISSION ON
06/07/2020 ALONG WITH Arb.A.20/2016, THE          COURT ON 07/01/2021
DELIVERED THE FOLLOWING:
 Arb.A.Nos.20 & 21 of 2016         :3:


                                                               C.R.
                            JUDGMENT

Haripal, J.

These are appeals preferred under Section 37(1)(c) of the

Arbitration and Conciliation Act, 1996, challenging the correctness

of the orders of the learned District Judge, Palakkad in Arbitration

O.P.No.51/2012 dated 23/12/2015 and O.P. No.305/2012 dated

17/12/2015, respectively. As the properties of both the appellants

were acquired by the National Highway Authority for the purpose

of widening the Valayar-Vadakkanchery sector of NH 47 under a

common notification, and since common grounds were urged, both

these appeals were heard together and are being disposed of by this

common judgment.

2. 0.0245 hectare of land in Survey No.211/4 in Block

No.36 of Kannambra-I village in Alathur taluk belonged to the

appellant in Arbitration Appeal No.20/2016 was acquired by the

respondents for the above purpose and compensation was awarded

by the Special Land Acquisition Officer. The amount was received

by her under protest and on the basis of the requisition made by her,

Arbitration Application No.98/2010 in LAC No.109/2009 was

preferred under the National Highways Act, 1956, which was

considered by the sole Arbitrator, the District Collector, Palakkad,

and by order dated 20/08/2011 an enhanced compensation was

granted to the appellant. The Special Land Acquisition Officer had

granted her compensation at the rate of Rs.60,000/- per Are and a

total compensation of Rs.2,65,252/- was allowed basing on

comparable sales method, relying on the consideration shown in

Sale Deed No.4720/2004 dated 20/12/2004. The Arbitrator

enhanced the land value at the rate of Rs.90,000/- per Are and also

granted 25% enhancement for the residential building and 20%

increase for the value of the remaining structures. Thus, an

additional compensation of Rs.1,04,449/- was granted as

enhancement, besides 9% interest on the enhanced amount from the

date of dispossession. Aggrieved by the same, the claimant moved

the District Court under Section 34 of the Arbitration and

Conciliation Act. By the impugned order, the learned District

Judge declined to interfere and the original petition was dismissed.

3. Turning to Arbitration Appeal No.21/2016, which was

also the subject matter of the same notification issued for the

purpose of widening the Valayar-Vadakkanchery sector of NH 47,

0.0445 hectare of land in Survey No.1/1 in Block No.43 of

Vadakkanchery-I village in Alathur taluk was acquired and the

claimant was given a compensation of Rs.3,37,337/-. Here also the

Special Land Acquisition Officer had based upon the very same

document, i.e., Document No.4720/2004, while adopting

comparable sales method. He also invoked the arbitration clause

and moved the Arbitrator, the District Collector, in Arbitration

Application No.238/2010 in LAC No.01/2009, who considered the

claim. By order dated 25/07/2011, the Arbitrator granted an

enhancement of Rs.1,67,215/-, which includes enhanced land value

of Rs.1,51,705/-, enhanced value of structure of Rs.309/- and

Rs.15,201/- as 10% user's right. He was also entitled to claim 9%

interest on the additional compensation. Aggrieved by the order of

the Arbitrator, the claimant moved the District Court with

Arbitration O.P.No.305/2012 and, by the impugned order dated

17/12/2015, that claim was also dismissed by the learned District

Judge.

4. Common questions have been raised in both these

appeals. We heard the learned counsel for the appellants and also

the learned Government Pleader for the respondents. In the nature

of the order we propose to pass, it is not necessary to call for the

trial records.

5. The learned counsel for the appellants has raised

mainly two arguments. Firstly, according to him, the claims made

under Section 3G(7) of the National Highways Act were not

considered by the Special Land Acquisition Officer or the

Arbitrator, and, therefore, in order to prove the prevailing market

value of the land and for quantifying the other damage suffered by

the appellants, they may be afforded one more opportunity and the

matters may be remanded, enabling them to adduce further

evidence. If that is not possible, he canvassed for setting aside both

the awards, so that matters will be taken afresh. In support of his

argument, the counsel relied on the decision of this Court in

Udayakumar v. Project Director and Another [2019 (1) KHC

740]. Secondly, he argued that he has not been granted solatium

and interest on solatium, which he is entitled as per the decision of

this Court in Paul Mani and others v. Special Deputy Collector

and Competent Authority (SLAO) and Another [2019 (4) KHC

465].

6. We shall deal with the initial contention first. After

going through the awards passed by the Arbitrator, it is quite certain

that the argument of the learned counsel that he could not bring in

evidence to buttress the claim of enhanced compensation is

factually incorrect.

7. Section 3G(6) of the National Highways Act provides

that, subject to the provisions of the Act, the provisions of the

Arbitration and Conciliation Act, 1996 shall apply to every

arbitration under the Act. Section 3G(7) reads, thus:

"(7) The competent authority or the arbitrator while determining the amount under sub-section (1) or sub- section (5), as the case may be, shall take into consideration-

(a) the market value of the land on the date of publication of the notification under section 3-A;

(b) the damage, if any, sustained by the person interested at the time of taking possession of the land, by reason of the severing of such land from other land;

(c) the damage, if any, sustained by the person interested at the time of taking possession of the land, by reason of the acquisition injuriously affecting his other immovable property in any manner, or his earnings;

(d) if, in consequences of the acquisition of the land, the person interested is compelled to change his residence or place of business, the reasonable expenses, if any, incidental to such change."

It is quite necessary that the competent authority or the Arbitrator

for determining the compensation under sub-section (5) of Section

3G has to take into consideration the market value of the land on

the date of notification issued under Section 3A, damage, if any,

sustained by the person interested in the property, etc. But from the

orders passed by the Arbitrator, it is obvious that even after

affording opportunity, the claimants did not produce any document

or evidence to prove the market value of the land prevailed on the

date of issue of the notification. It is true that both of them had

made claim statements. The appellant in Arbitration Appeal

No.20/2016 had claimed Rs.1,20,000/- per Are as land value

whereas the appellant in Arbitration Appeal No.21/2016 had

claimed Rs.10,00,000/- as compensation.

8. Even though both the appellants wanted to make the

competent authority believe that their properties would have

fetched higher market value, they remained dormant at the time of

taking evidence. It has come out from the impugned orders that the

Special Land Acquisition Officer had awarded land value basing on

the consideration shown in Sale Deed No.4720/04 dated

20/12/2004, which was executed about ten months prior to the date

of the notification. Comparable sales method, an acceptable mode

of fixing land value in land acquisition cases was adopted by the

Special Land Acquisition Officer. Later, when the matters were

referred for arbitration, the Arbitrator had issued notice to the

appellants and afforded opportunity to prove their claims that the

property would have fetched still higher value, they did not adduce

any evidence nor any document was produced for apprising the

Arbitrator that the property had a still higher value. In spite of the

same, taking into consideration the trends in the real estate market,

the Arbitrator took into account post-notification developments and

granted enhancement. He had granted enhancement under the

heads like land value, value of improvements and user's right

besides interest on additional compensation awarded by him.

9. That means, the Arbitrator did not place explicit

reliance on the valuation made by the Special Land Acquisition

Officer, but had taken into consideration increase in value of the

land subsequent to the date of notification and thus enhancement

was given to both the appellants. In other words, even in the

absence of the claimants producing supporting documents or proof,

the Arbitrator had taken into consideration post-notification

developments as well, while granting enhancement in land value as

well as value of structures.

10. There is no inviolable rule that post-notification

developments shall not be considered while fixing the land value.

In the absence of better materials or documents, it is always open to

the Land Acquisition Officer or the competent authority to take into

reckoning post-notification developments as well, for granting

reasonable and fair compensation to the owners of land whose

properties were acquired for a public purpose. As mentioned

earlier, the Arbitrator has granted enhancement in compensation

under all possible heads, making good the loss sustained by the

appellants.

11. When the appellants/claimants before the Arbitrator

contended that their properties would have fetched still higher

value, it is for them to prove the same. They have not adduced any

evidence. The evidential burden was on them. Thus, applying

'who will fail' theory, it can be concluded that the appellants could

not establish that their properties would have fetched much higher

value or they would have been entitled to get value of

improvements at a still higher rate than what was estimated by the

Arbitrator.

12. As adverted to earlier, the learned counsel also

canvassed for remanding the matter to the Arbitrator, facilitating to

adduce evidence and produce documents in support of their

arguments. The date of notification for acquisition was on

21/10/2005. The matter was considered by the Special Land

Acquisition Officer and the Arbitrator during 2010-2011. Now

more than fifteen years have elapsed and thus, in our view, it is idle

to remit the matters to re do the exercise, which is against the

interest of justice.

13. Secondly, it is the settled proposition of law that

matters cannot be remanded back to the authority below in order to

decide any question of fact which was not properly pleaded and no

evidence was let in by the parties in support of the claim. It is the

consistent stand of the Apex Court that an order of remand cannot

be passed in a routine or lighthearted manner facilitating a party to

fill up the lacuna or for production of fresh evidence, which

opportunity they had failed to utilise. Remand is permissible only

when the Appellate Court arrives at the finding that the judgment of

the trial court is erroneous and is liable to be reversed or set aside;

it is a condition precedent for passing an order under Rule 23/23A

of Order 41 of the Code of Civil Procedure. Moreover, in ordinary

parlance, the party seeking remand must show that any material

evidence was either ignored, misread or misconstrued or any other

illegality was construed by the authority below. Here, the

appellants have no such case. Hence the prayer for putting the

clock back for production of fresh evidence regarding market value

of the land for enhancement of compensation at this distance of

time cannot be accepted.

14. Still worse is the scope for such a prayer for remand in

a proceedings under the Arbitration and Conciliation Act. It is the

settled proposition of law, having regard to the scope and ambit of

Section 34 of the Arbitration Act, that its powers are merely

supervisory in nature and the Court cannot act as though exercising

the appellate jurisdiction. The Court cannot correct the errors from

the order of Arbitrator, but can only quash the order leaving the

parties free to begin the arbitration afresh, if they so desire.

Arbitrator is considered to be the sole Judge of the quality as well

as quantity of evidence. The Arbitration Act aims at keeping

supervisory role of the court at minimum level and this is justified

as the parties to the agreement make a conscious decision to

exclude the jurisdiction of the Courts by opting for arbitration,

which is an alternate dispute resolution mechanism as they prefer

expediency and finality offered by it.

15. From a bare reading of Section 34 it is clear that the

arbitral award can be set aside only if one of the major five grounds

contained in sub-section 2(a) of Section 34 of the Act or any one of

the two grounds contained in sub-section (2)(b) exists. After the

amendment of the Act on 23/10/2015, sub-section (2-A) also has

been incorporated which provides that an arbitral award arising out

of arbitrations other than international commercial arbitrations also

can be set aside by the Court, if the Court finds that the award is

vitiated by patent illegality appearing on the face of the award.

Besides these grounds the award can also be set aside if it is in

contravention to the provisions made under in Section 31(3) of the

Arbitration Act. In the absence of an agreement between the

parties it is mandatory for the Arbitrator to give reasons for the

award. The question of the award being contrary to the public

policy of India has to be invoked and substantiated. It is also

settled by law that the scope for setting aside the award is limited to

the grounds available under the Arbitration Act, which have been

well-defined by numerous authorities on the subject.

16. In this connection, it seems apposite to extract the

following proposition of the law laid down by the Delhi High Court

in Union of India v. Bharat Builders [2002 (2) RAJ 576 (Del.)]

in the context of Section 34 of the Act:

"It is settled law that court does not sit in appeal nor is it required to

re-appreciate or reassess or re-evaluate the documents/material placed before the arbitrator. Even if erroneous view has been taken by the arbitrator in respect of the finding of fact or interpretation of terms and clauses of the agreement, the court should be reluctant to interfere until and unless perversity or non-application of mind or error is writ large on the face of the award. Unless bias or partiality of the arbitrator is manifestly demonstrated, the award should not be set aside because the parties choose forum on their own and to assail the findings of facts based upon the material produced by the parties amounts to stultifying the statute and its object and purpose. The object of the Arbitration Act is to minimise the disputes between the parties and not to allow the parties to challenge the finding by way of appeal. Scrutiny or scanning of findings of facts of the arbitrator is neither permissible nor called for unless a party succeeds in establishing any of the ingredients of Section 34 of the Act. It is not entitled to subvert the award."

We are in agreement with the above proposition of law laid down

by the Delhi High Court.

17. The jurisdiction of the court under Section 34 being

supervisory, the scope and ambit of the jurisdiction of this Court

under Section 37 also cannot be enlarged further. High Court while

hearing an appeal under Section 37 cannot interfere with the award

unless the findings and conclusions of the Arbitrator are totally

perverse and illegal. In the decision in Kinnari Mullick and

Another v. Ghansyam Das Damani [(2018) 11 SCC 328], the

Apex Court has held, approving the decision in McDermott

International Inc v. Burn Standard Co. Ltd. and Others [(2006)

10 SCC 181], that no power has been invested by the Parliament in

the court to remand the matter to the arbitral tribunal except to

adjourn the proceedings of the court to the limited purpose

mentioned in sub-section (4) of Section 34. That means, the prayer

for remanding the matter to the Arbitrator is to be rejected. Thus,

the first contention of the learned counsel does not merit

consideration.

18. The second argument raised by the learned counsel was

that the appellants were not paid solatium and interest on solatium.

In this connection he has placed reliance on the decision of this

Court in Paul Mani's case (supra).

19. True that this contention has been raised by the

appellants for the first time before this Court in appeal. But, having

regard to the circumstances, we cannot deny the claim on the

technical ground that such a contention was not urged either before

the Arbitrator or the District Court. As pointed out by the learned

counsel, in Paul Mani's case (supra), where one of us was party

(Ravikumar, J), this Court had occasion to consider the claim and

the same was granted approving the decision of the Punjab and

Haryana High Court in M/s.Golden Iron and Steel Forging v.

Union of India [2011 (4) RCR 375 (Civil)] (CWP No.11461 of

2005 dated 28/03/2008), where the court had held that Section 3J of

the National Highways Act is violative of Article 14 of the

Constitution of India. Approving the dictum this Court held that

the appellants are entitled to claim solatium and interest thereon

since the proceedings under consideration was pending on

28/03/2008, the date of pronouncement of the judgment by the

Punjab and Haryana High Court.

20. Soon later, the Apex Court had occasion to consider the

vires of the said order of the Punjab and Haryana High Court and

by the decision reported in Union of India and Another v. Tarsem

Singh and Others [2019 KHC 6936], the Apex Court has held,

after making an elaborate survey of the rule position that the

provisions of the Land Acquisition Act 1894, relating to solatium

and interest contained in Section 23(1A) and (2) and interest

payable in terms of the proviso to Section 28 will apply to

acquisitions made under the National Highways Act; the Apex

Court thus declared that the provision of Section 3J of the National

Highways Act is, to this extent, violative of Article 14 of the

Constitution of India and therefore declared unconstitutional.

21. That means, it has become the law of the land under

Article 141 of the Constitution of India, that solatium and interest

on solatium can be granted to all cases of the land acquisitions

made under the National Highways Act which are live on the date

of making the declaration. In that view of the matter, even in the

absence of specific plea or proof, the appellants are entitled to

claim solatium and interest on solatium on the lines under Section

23(1A) and (2) and interest in terms of the proviso to Section 28 of

the Land Acquisition Act.

The appeals are allowed to the above extent. No costs. The

respondents are directed to quantify the amounts under Section

23(1A) and (2) and proviso to Section 28 of the Land Acquisition

Act and pay the same, at the earliest.

Sd/-

C.T.RAVIKUMAR JUDGE

Sd/-

K. HARIPAL JUDGE

okb/22/7/2020

//True copy// P.S. to Judge