Arbitration Petition No. 3 of 2020 · The High Court
Case Details
IN THE HIGH COURT OF ORISSA AT CUTTACK ARBA No.12 of 2023 In the matter of an Appeal under Section 37 of the Arbitration and Conciliation Act, 1996 assailing the judgment dated 19th April, 2023 passed by the learned District Judge, Keonjhar in Arbitration Petition No.3 of 2020. ---- Mukunda Pada Baral & Others …. Appellants -versus- Tahasildar-cum-Land Acquisition Officer & Competent Authority, NH-4(49) Project Bansapal, Keonjhar & Others …. Respondents Appeared in this case by Hybrid Arrangement (Virtual/Physical Mode): ================================================ For Appellants - Mr.P.S. Das, (Advocate) For Respondents
Legal Reasoning
- Mr.Amitav Das, (Advocate for R.2) Mr. G.N. Rout, ASC for R.1 CORAM: MR. JUSTICE D.DASH Date of Hearing : 19.12.2023 : Date of Judgment: 08.01.2024 D.Dash, J. The Appellant, by filing this Appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (for short ‘the A&C Act’ 1996), has assailed the judgment dated 19th April, 2023 Page 1 of 9 ARBA No.12 of 2013 {{ 2 }} passed by the learned District Judge, Keonjhar in Arbitration Petition No.3 of 2020 in the matter of an application under section-34 of the A & C Act, 1956 read with sub-section-6 of section-(G) of the National Highway Act, 1996. 2. Brief facts leading to the instant Appeal are as follows:- The Appellants are the recorded owner of the land measuring Ac.0.89 dec. in mouza-Tentuli in the District of Keonjhar. From out of the same, land to the extent of Ac. 0.035 dec. land was acquired for the purpose of expansion of National Highway No.49. The Appellant has been awarded competition of Rs.13,11,102/- The Appellants raised their objection as to the assessment of the above compensation. The main ground is that the structure of their residential building having around 3700 sq. ft. of plinth area for the acquisition of structure covering 410 sq ft. of the plinth area has became useless and unusable. Therefore, it is said that the whole building having become useless, the assessment of compensation ought to have been with the addition of the market value of the rest of the structures. 3. The matter thus went to the Arbitrator in Arbitration
Decision
Case No.16-2017-N.H.-6. The Arbitrator disposed of the matter directing the Respondent No.1 for fresh calculation of the compensation taking into consideration the land value of the acquired land, the structure value of Rs.5,28,571/- as decided ARBA No.12 of 2013 Page 2 of 9 {{ 3 }} in the original award and the left out structure value of Rs.7,30,989/- along with all other statutory benefits and interest @ 9 % per annum till payment. 4. The Appellant aggrieved by the said award filed an application under section 34 of the A & C Act. The learned District Judge has rejected the said application in refusing to set aside the award passed by the Arbitrator. 5. Heard Mr. P.S. Das, learned counsel for the Appellant; Mr.A. Das, learned counsel for the Respondent No.2 (NHAI) and Mr. G.N. Rout, learned Additional Standing Counsel at length. I have carefully read the judgment passed by the learned District Judge in disposing of the application under section 34 of the A & C Act and have also gone through the award passed by the Arbitrator. 6. The scope of the provision of section 37 of the A & C Act has been analyzed by the Supreme Court in MMTC Ltd. Vrs. M/s.Vedanta Ltd., 2019 (4) SCC 163 where it was held: “14. As far as interference with an order made under Section 34, as per Section 37, is concerned, it cannot be disputed that such interference under Section 37 cannot travel beyond the restrictions laid down under Section 34. In other words, the court cannot undertake an independent assessment of the merits of the award, and must only ascertain that the exercise of power by the court under Section 34 has not exceeded the scope of the provision. Thus, it ARBA No.12 of 2013 Page 3 of 9 {{ 4 }} is evident that in case an arbitral award has been confirmed by the court under Section 34 and by the court in an appeal under Section 37, this Court must be extremely cautious and slow to disturb such concurrent findings.” 7. A similar view has been taken by the Supreme Court delineated the scope of Section 37 of the A & C Act and observed thus: “8. So far as the impugned judgment and order passed by the High Court quashing and setting aside the award and the order passed by the Additional District Judge under Section 34 of the Arbitration Act are concerned, it is required to be noted that in an appeal under Section 37 of the Arbitration Act, the High Court has entered into the merits of the claim, which is not permissible in exercise of powers under Section 37 of the Arbitration Act. 9. As per settled position of law laid down by this Court in a catena of decisions, an award can be set aside only if the award is against the public policy of India. The award can be set aside under Sections 34/37 of the Arbitration Act, if the award is found to be contrary to, (a) fundamental policy of Indian Law; or (b) the interest of India; or (c) justice or morality; or (d) if it is patently illegal. None of the aforesaid exceptions shall be applicable to the facts of the case on hand. The High Court has entered into the merits of the claim and has decided the appeal under Section 37 of the Arbitration Act as if the High Court was deciding the appeal against the judgment and decree passed by the learned trial court. Thus, the High Court has exercised the jurisdiction not vested in it under Section 37 of the ARBA No.12 of 2013 Page 4 of 9 {{ 5 }} Arbitration Act. The impugned judgment and order passed by the High Court is hence not sustainable.” 9. The Supreme Court, has repeatedly reiterated in Mcdermott International Inc. v. Burn Standard Co. Ltd.4, NHAI v. M. Hakeem5 and K. Sugumar v. Hindustan Petroleum Corpn. Ltd. among others, that the A&C Act includes a provision for the supervisory role of courts, for the review of the arbitral award only to ensure fairness. 10. From a perusal of the judicial dicta cited hereinabove, it is discernible that the scope of interference under Section 37 of the A&C Act is narrow. Before interfering with an Award passed by the Arbitral Tribunal, which, in fact, has been concurred with by the First Appellate Court, this Court shall circumspect and refrain from reassessment or re-examination of the merits of the case, as if it were a Court of Appeal against the Award. In other words, the court cannot undertake an independent assessment of the merits of the award, and must only ascertain that the exercise of power by the court under Section 34 has not exceeded the scope of the provision. Thus, it is evident that in case an arbitral award has been confirmed by the court under Section 34 and by the court in an appeal under Section 37, this Court must be extremely cautious and slow to disturb such concurrent findings. ARBA No.12 of 2013 Page 5 of 9 {{ 6 }} 11. It is similarly fairly well settled law that the jurisdiction of the Court under Section 34 of the A&C Act is narrow and limited. Reliance in this regard may be placed upon the Supreme Court’s judgment in UHL Power Company Ltd. v. State of Himachal Pradesh, wherein it was observed that: “16. As it is, the jurisdiction conferred on courts under Section 34 of the Arbitration Act is fairly narrow, when it comes to the scope of an appeal under Section 37 of the Arbitration Act, the jurisdiction of an appellate court in examining an order, setting aside or refusing to set aside an award, is all the more circumscribed.” 12. The Supreme Court in State of Chattisgarh v. Sal Udyog reiterated its earlier observations in Delhi Airport Metro Express (P) Ltd. v. DMRC while referring to the facets of patent illegality, held as under: illegality. as patent “29. Patent illegality should be illegality which goes to the root of the matter. In other words, every error of law committed by the Arbitral Tribunal would not fall within the expression “patent illegality”. Likewise, erroneous application of law cannot be categorised addition, contravention of law not linked to public policy or public interest is beyond the scope of the expression “patent illegality”. What is prohibited is for courts to reappreciate evidence to conclude that the award suffers from patent illegality appearing on the face of the award, as Courts do not sit in appeal against the arbitral for interference with a domestic award under Section award. The permissible grounds In ARBA No.12 of 2013 Page 6 of 9 {{ 7 }} 34(2-A) on the ground of patent illegality is when the arbitrator takes a view which is not even a possible one, or interprets a clause in the contract in such a manner which no fair-minded or reasonable person would, or if the arbitrator commits an error of jurisdiction by wandering outside the contract and dealing with matters not allotted to them. An arbitral award stating no reasons itself susceptible this account. The conclusions of the arbitrator which are based on no evidence or have been arrived at by ignoring vital evidence are perverse and can be set aside on the ground of patent illegality. Also, consideration of documents which are not supplied to the other party is a facet of perversity falling within the expression “patent illegality.” An award might be set aside stating it to be patently for to challenge on findings would make its illegal, provided the illegality goes to the root of the award. If the illegality is of a trivial nature, it cannot be said that the award is against public policy. This proposition was reaffirmed by the Supreme Court in Hindustan Zinc Ltd. v. Friends Coal Carbonization. 13. It be stated at first that the Appellant had not filed an application before the Authority that his entire land be acquired in terms of section 94 of the RFCTLAR & R Act, 2013. There was no such prayer before the Authority. The Appellant simply prayed for reassessment and remeasurement of the entire land of the extent of Ac.0.089 dec. appertaining to Plot No.934/1784. ARBA No.12 of 2013 Page 7 of 9 {{ 8 }} 14. It appears that the Arbitrator has considered that case of the Petitioner and all those aspects raised by the Appellant and has directed to calculate the compensation afresh taking into consideration the land value of the acquired land, structure value as well as the left out structure value. It further appears on perusal of the impugned judgment that the learned District Judge was quite conscious of his power under section 34 of the A & C Act. It is seen that the impugned award has been perused and only after such perusal, the opinion has been rendered that the Arbitrator keeping in view the arena of challenge made by the Appellant has rightly arrived at the conclusion. 15. This Court does not find any merit in the contention that the learned District Judge has passed the impugned judgment without application of mind. In fact, the impugned judgment reveals that the parties have been heard, their contentions have been well assessed and taken care of. In the light of the discussion made above, keeping the settled principles of law in mind and for the reasons given above, this Court is of the considered view that the impugned judgment as well as the award passed by the Arbitrator warrant no interference in this Appeal under section 37 of the A & C Act. ARBA No.12 of 2013 Page 8 of 9 {{ 9 }} 16. Accordingly, the Appeal stands dismissed. There shall, however, no order as to cost. (D. Dash), Judge. Himansu Signature Not Verified Digitally Signed Signed by: HIMANSU SEKHAR DASH Reason: Authentication Location: OHC Date: 12-Jan-2024 15:11:33 ARBA No.12 of 2013 Page 9 of 9