Punjab-Haryana High Court
Union Of India vs Jagroop Singh And Others on 1 December, 2022
CR-5614-2022 (O&M) 1
129-2
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CR No.5614 of 2022 (O&M)
Date of Decision: 01.12.2022
UNION OF INDIA ......Petitioner
Vs
JAGROOP SINGH AND OTHERS .....Respondents
CORAM: HON'BLE MR. JUSTICE RAJ MOHAN SINGH
Present:Mr. Sunil K. Sharma, Advocate
for the petitioner.
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RAJ MOHAN SINGH, J.(Oral)
Vide order dated 30.09.2022, a bunch of cases with the
lead case bearing CR No.259 of 2022 was decided. In paras
No.29, 34, 35, 36, 38 and 39 following observations were made
by this Court:-
"[29]. In view of BGS SGS Soma JV case (supra),
the petitioners cannot be allowed to contend that as per
2019 Rules, there is automatic stay in contrary to Section
36 of the Arbitration and Conciliation Act. Reliance can
be placed upon Pam Developments and Private
Limited Vs. State of West Bengal, 2019(3) RCR (Civil)
603 and BCCI Vs. Kochi Cricket Pvt. Ltd., (2018) 6
SCC 287, where the contentions with regard to automatic
stay was deprecated by the Court and it was held that in
view of Section 36 of the Act, mere filing of an application
under Section 34 of the Act, shall not stay enforceability
of the award unless the Court grant a stay of operation of
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the arbitration award in accordance with the provision of
sub Sections 2 and 3 of Section 36 of the Act. No stay
has been granted by the Court at Bathinda in the
objection petition under Section 34 of the Arbitration and
Conciliation Act. Petitioners have deposited the awarded
amount as per the award by the Arbitrator at Faridkot. It
is only the enhanced amount for which this method has
been adopted by the petitioners under the garb of
Section 42 of the Act. The respondents are losing huge
amount per day towards interest. The amount has been
partly deposited by the petitioners in the executing Court.
Petitioners are not going to lose anything if the amount is
released to the claimants. Para No.1 of the award itself
shows that Government of India had appointed the
Commissioner, Faridkot, Division Faridkot as Arbitrator
under Section 3G(5) and (6) of the National Highways
Act, 1956 vide letter dated 16.07.2015 for Bathinda
District, Punjab, thereby creating seat of the Arbitrator at
Faridkot. In the proceedings arising out of the same
award, the petitioners have already deposited the
enhanced amount in the executing Court in Ex.535 of
2019 titled Harpreet Singh Vs. National Highway
Authority of India. Perusal of Arbitration Case No.10
dated 04.01.2016 titled Union of India and others Vs.
Ujjagar Singh and others decided on 29.01.2016 and
Case Code No.PBLD01-000559-2016 titled Nirmal
Singh and another Vs. Union of India and others
decided on 29.01.2020 would show that the petitioners
have admitted the jurisdiction of the Court, where the
award is passed. Even in those cases, the petitioners
had admitted that the objection petition under Section 34
of the Arbitration and Conciliation Act is maintainable in
the Court where the award is passed by the Arbitrator
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and the objection petition under Section 34 of the Act,
challenging the award can only be filed before the Court,
who is having jurisdiction over the place where the award
is passed. The stand has been taken in view of the
judgment of the Hon'ble Apex Court in Civil Appeal
No.2077 of 2015 arising out of SLP(C) No.8675 of 2014
titled M/s Bhandari Udyog Ltd. Vs. Industrial
Faciliation Council and another.
[34]. As regards CR No.831 of 2022, it can be
appreciated that as regards Rule 3 of the National
Highways (Manner of depositing the amount by the
Central Government; making requisite funds available to
the competent authority for acquisition of land) Rules,
2019 is concerned, the same does not create any
automatic stay as the Rule is only in respect of manner in
which the disbursement has to be made and also the
manner of making requisite funds available to the
competent authority. Rule 3 of the National Highways Act
deals with the manner of making requisite funds available
to the competent authority which shall be as follows:-
"3. The manner of making requisite funds
available to the competent authority shall be as
follows:-
(i) Subject to provisions of the Act, the
executing agency authorised by the Central
Government in this behalf, shall open and maintain
an account with one or more Scheduled
Commercial Banks for remittance of the amount for
land acquisition across the country, with
arrangements for access to such account by the
competent authority for specific jurisdiction as per
authorisation of limits by the executing agency. The
Executing Agency shall, on the demand raised by
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the competent authority before announcement of
the award, issue requisite authorisation limits in
favour of the competent authority for withdrawal of
amount from such account as per requirements
from time to time for disbursement to the
landowners or persons interested therein through
an electronic banking mechanism as per extant
Reserve Bank of India regulations and the said
authorisation limits, revolving in nature, shall entitle
the competent authority to withdraw money from
such account as per requirements, without any
further reference to the land acquiring agency, for
disbursement to the landowners or persons
interested therein, as follows:
(a) The amount determined under section 3-G
of the Act within fifteen days of the raising of
demand by the competent authority, and
(b) Where the amount determined by the
Arbitrator under sub section (7) of section 3-G of
the Act is in excess of the amount determined by
the competent authority, the excess amount,
together with interest, if any, awarded by the
Arbitrator, within 30 days of the communication of
Arbitrator's award, unless such Award has been
further challenged by either of the aggrieved
parties."
[35]. Bare perusal of the aforesaid Rule would show
that the Rules only govern the internal functioning of the
Government and has nothing to do with the enforcement
of the arbitral award. The Rules cannot create a law,
which has already been legislated and does not provide
for automatic stay. These rules are formulated as per
Clause (aa) of sub Section (2) of Section 9 of National
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Highways Act, 1956, which is reproduced hereasunder:-
"9. Power to make rules.-(1) The Central
Government may, by notification in the Official
Gazette, make rules for carrying out the purposes
of this Act.
(2) In particular and without prejudice to the
generality of the foregoing power, such rules may
provide for all or any of the following matters,
namely
(a) the manner in which, and the
conditions subject to which, any function in
relation to the development or maintenance of
a national highway or any part thereof may be
exercised by the State Government or any
officer or authority subordinate to the Central
Government or the State Government;
[(aa) the manner in which the amount shall be
deposited with the competent authority under
subsections (1) and (6) of section 3H
(b) the rates at which fees for services
rendered in relation to the use of ferries,
permanent bridges, temporary bridges and
tunnels on any national highway [and the use
of sections of any national highway] may be
levied, and the manner in which such fees
shall be collected, under section 7;]
(c) the periodical inspection of national
highways and the submission of inspection
reports to the Central Government;
(d) the reports on works carried out on
national highways;
(e) any other matter for which provision
should be made under this Act.
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[(3) Every rule made under this section shall be
laid, as soon as may be after it is made, before
each House of Parliament, while it is in session, for
a total period of thirty days which may be
comprised in one session or in two or more
successive sessions and if, before the expiry of the
session immediately following the session or the
successive sessions aforesaid, both Houses agree
in making any modification in the rule or both
Houses agree that the rule should not be made. the
rule shall thereafter have effect only in such
modified form or be of no effect, as the case may
be; so, however, that any such modification or
annulment shall be without prejudice to the validity
of anything previously done under that rule.]"
[36]. The Statute clearly states that the Rules are to
be formulated regarding the deposit of compensation
amount and does not provide for any stay of the
proceedings. It is also pertinent to mention here that
Section 3G(6) of the National Highways Act clearly states
that subject to the provision of this Act, the provisions of
the Arbitration and Conciliation Act, 1996 shall apply to
every arbitration under this Act. Once the matter has
been settled by the Arbitrator and award has been
passed, it becomes a decree to be enforced by the
executing Court while following law as per Code of Civil
Procedure. The provisions of the National Highways Act
shall not govern the proceedings once the arbitration
award has been passed.
[38]. Case titled Land Acquisition No.9689
of 2019 titled Ram Awadh Vs. Competent
Authority/Spl. Land Acquisition Officer, Bbk. and
another decided on 16.04.2019 is not applicable to the
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present case for the simple reason that in the aforesaid
case, the Court did not consider the fact that 2019 Rules
are not applicable so far as payments to landowners are
concerned. The Rules are framed under Section 9 of the
National Highways Act, 1956 and the Statute clearly
states that the Rules are to be formulated regarding
deposit of compensation amount and does not provide
for any automatic stay of disbursement. In the aforesaid
judgment, unamended Section 36 of the Arbitration and
Conciliation Act has been quoted without adhering to the
bar created in view of proviso to Section 36(3) of the Act.
Section 3G(6) of the National Highways Act clearly states
that subject to the provisions of this Act, provisions of
Arbitration and Conciliation Act shall apply to every
arbitration under this Act. Once the matter has been
decided by the Arbitrator and the award has been
passed, it becomes a decree to be enforced by the
executing Court after following procedure as mentioned
under Code of Civil Procedure. The provisions of
National Highways Act shall not govern the proceedings
once the award has been passed. Rule itself makes it
clear that the same is internal arrangement of the Central
Government/Highway Authority and the competent
authority only for making the funds available to the land
owners. 2019 Rules talks about the national highway
manner of depositing the amount by the Central
Government making requisite funds available to the
competent authority for acquisition of land.
[39]. Since in Ram Awadh's case (supra),
unamended Section 36 of the Act has been relied,
therefore, the same is distinguishable on the facts of
present case and in view of interpretation of Rules of
2019."
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The aforesaid order has also been upheld by the
Hon'ble Apex Court vide order dated 29.11.2022 passed in
Special Leave to Appeal (C) No.20804-20809 of 2022.
In view of aforesaid factual position, no interference is
called for in this case. The same is dismissed.
Pending application(s), if any, stand disposed of.
(RAJ MOHAN SINGH)
December 01, 2022 JUDGE
Atik
Whether speaking/reasoned Yes/No
Whether reportable Yes/No
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