- 1 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 28TH DAY OF JULY, 2025 PRESENT THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND THE HON'BLE MR. JUSTICE RAJESH RAI K COMMERCIAL APPEAL NO. 441 OF 2024 BETWEEN: NATIONAL HIGHWAYS AUTHORITY OF INDIA PROJECT IMPLEMENTATION UNIT, DOOR NO.3-29, BETHEL, THARETHOTA, NEAR PUMPWELL (NH-66), MANGALORE - 575 005, REPRESENTED BY ITS DGM (TECH) & PROJECT DIRECTOR MR. ABDULLA JAVED AZMI …APPELLANT (BY SRI. HANUMANTHA REDDY G, ADVOCATE) AND: 1. SMT. REENA ARSHIYA IBRAHIM, MAJOR, W/O. SOOPI IBRAHIM K.S. D/O. LATE YUSUF B.L. MAMTAZ MANZIL SAMARAGUNDI, GOLITHOTTU KADABA TALUK, PRESENTLY R/AT FLAT NO.005, WEST GATE LIYANA RESIDENCY, NANDIGUDDA MANGALORE-575 002 2. SRI. YUSUF HARIS CHIKAMANGALORE S/O. LATE YUSUF B.L. NO.33-143 (B) MARVA, Digitally signed by PANKAJA S Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 MAJID COMPOUND, MULOOR VILLAGE, MULOOR, UCHILA UDUPI-574 117 3. SMT. FATHIMA SHAFILABOLWAR W/O. ILYAS AHMED, FLAT NO.005, LIYANA RESIDENCY, BAPPAL ROAD, NANDIGUDDA, MANGALORE-575 002 4. THE ARBITRATOR (N.H.) AND DEPUTY COMMISSIONER AND ARBITRATOR, DAKSHINA KANNADA DISTRICT, MANGALORE-575 001. 5. THE COMPETENT AUTHORITY & THE SPECIAL LAND ACQUISITION OFFICER, (N.H.A.I), NH-75, HASSAZ-BC ROAD JUNCTION, NO.HIG-64, DTDC COURIER OFFICE BUILDING, 1ST FLOOR, KHB COLONY CHANNAPATTANA, OPP KSRTC NEW BUS STAND, HASSAN-573 201. …RESPONDENTS (BY SRI. RAJA SUBRAHMANYA BHAT B, ADVOCATE FOR R1-R3 R4 & R5 SERVED AND UNREPRESENTED) THIS COMAP IS FILED UNDER SECTION 13 (1A) OF THE COMMERCIAL COURTS ACT, 2015, PRAYING TO SET ASIDE THE JUDGMENT AND DECREE DATED 09.09.2024 PASSED BY IV ADDITIONAL DISTRICT JUDGE AND COMMERCIAL COURT, D.K. MANGALURU, IN ARBITRATION PETITION NO. 279/2023 AND CONSEQUENTLY SET ASIDE ARBITRAL AWARD BEARING NO.C.DIS.ARB (3) NH.LAQ.CR.155/2021-22 DATED 28.03.2023 PASSED BY RESPONDENT NO.4 AND ETC., THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE RAJESH RAI K - 3 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE RAJESH RAI K) This Commercial Appeal is filed by the appellant / National Highways Authority of India (NHAI), praying to set aside the impugned judgment dated 09.09.2024 in A.P.No.279/2023 passed by the IV Addl. District Judge and Commercial Court, D.K. Mangaluru (hereinafter referred to as the 'learned District Judge' for short) and to further set aside the impugned Arbitral Award dated 28.03.2023 in the proceedings bearing No. C.DIS.ARB(3) NH/LAQ/CR.155/2021- 22 passed by the fourth respondent - Arbitrator. 2. The abridged facts of the case are as under: The appellant was entrusted with the work of development, maintenance, management, upgradation and widening of National Highway No.75(48), amongst other lands. The land bearing Sy.No.2/1B4 measuring 30 sq.mtrs. (0.74 cents) belongs to respondent Nos.1 to 3 situated at Nellyadi Village of Puttur Taluk has been acquired for the purpose of widening National Highway No.75(48), under Section 3A(1) National Highways Act, 1956 (hereinafter referred to as the 'NH Act' for - 4 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 short) vide Notification S.O No.326(E) dated 06.02.2013, which was approved by the Central Government. The said notification was published in the gazette of India Extra-ordinary and also in two local newspaper namely Prajavani (Kannada) and Times of India (English) on 27.03.2013. The final notification as per Section 3D(1) was published in the Gazette of India extra- ordinary vide S.O.228(E) on 23.01.2014. Public notice was given in 'Udayavani' and 'The Times of India' newspapers on 16-02-2014. Respondent No.5 - SLAO & CA passed the award under NH Act, determining the compensation in Award No.LAQ/SLAO/HSN/AWD/DK-1 & 1A/NELLYADI/2015-16 dated 10-09-2015, awarding reasonable compensation. 3. Being aggrieved by the compensation amount determined by the SLAO and CA, respondent Nos.1 to 3 filed an application before the fourth respondent - Arbitrator for re- determination of compensation determined by the SLAO. The appellant had filed statement of objection opposing the claim petition. The Arbitrator had allowed the claim of respondent Nos.1 to 3 and passed the award on 28.03.2023 by enhancing the compensation at the rate of Rs.1,75,032/- per cent to an - 5 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 extent of 30 sq.mtrs. (0.74 cents) with 9% interest along with benefits admissible under the provisions of Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act 2013, (hereinafter referred to as the '2013 Act' for short). 4. The appellant-NHAI, being aggrieved by the Award passed by the respondent No.4-Arbitrator, approached the learned District Judge in A.P No.279/2023, whereby the learned District Judge dismissed the said Arbitration Petition filed by the appellant by its order dated 09.09.2024. The same is challenged under this appeal by the appellant-NHAI. 5. We have heard the learned counsel Sri. Hanumantha Reddy. G for the appellant and learned counsel Sri Raja Subrahmanya Bhat. G for respondent Nos.1 to 3. 6. The primary contention of the appellant is that the learned District Judge while dismissing the petition filed under Section 34(2) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'A & C Act' for short), failed to appreciate the aspect that respondent No.5-SLAO has - 6 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 determined the market value in respect of acquisition of land under NH Act by taking into consideration the average of three years of sale statistics of the land and guidance value of the land surrounding the land acquired and awarded suitable compensation. However, the learned Arbitrator while re- determining the compensation failed to take into account the criteria provided under Section 3G(7)(a) of NH Act and also Sections 26 to 30 of the 2013 Act. According to the learned counsel, the Arbitrator is bound to determine the market value as on the date of notification issued under Section 3A(1) of NH Act. He further contended that the Arbitrator has failed to take note of the aspect that the application was filed by respondent Nos.1 to 3 for enhancement, after lapse of limitation period of three years. In such circumstances, the learned District Judge erred in confirming the award passed by the Arbitrator by dismissing the arbitration petition. Accordingly, he prays to allow the appeal. 7. Per contra, the learned counsel for the contesting respondents submits that the Arbitrator and the learned District Judge, after meticulously examining the entire evidence on - 7 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 record and considering the value of the land acquired, determined the market value and despite the same, the appellant preferred this appeal only to drag on and to get time for depositing the award amount. He further contended that the market value of the land is determined as on the date of publication of notification under Section 3A(1) of NH Act, further the appeal is filed well within time. With this submission, he prays to dismiss the appeal. 8. Having heard the learned counsel for both the parties, the sole point that arises for our consideration is: Whether the learned District Judge is justified in dismissing the AP No.279/2023 by confirming the award dated 28.03.2023 in C.DIS.ARB(3)NH.LAQ/CR-155/2021-22 passed by the Arbitrator/respondent No.4? 9. We have given our anxious consideration to the arguments advanced by the learned counsel for their respective parties and also perused the record placed before us. 10. As could be gathered from records, a gazette notification was issued for acquisition of land of the respondent Nos.1 to 3 for widening of NH-75 (48). Further, as per Section - 8 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 3C of the NH Act, the SLAO had conducted the enquiry and received the objections and thereafter, rejected the same, since the land proposed for acquisition in the notification was essential and absolutely required for formation of four-lane National Highway. Accordingly, the final notification was issued under Section 3D(1) of NH Act on 23.01.2014. Thereafter the Competent Authority - SLAO has passed the award dated 10.09.2015. Hence, the SLAO has followed the procedure while acquiring the land and accordingly awarded the compensation. 11. The Arbitrator-respondent No.4 while determining the compensation amount, followed the procedure established under Section 3G(7) of NH Act and considered the market value, the damage sustained by the interested persons i.e., respondents 1 to 3 and the consequences of acquisition of land. It was also considered by the Arbitrator-respondent No.4 that the District where the land was acquired i.e., Dakshina Kannada is densely populated and hence the acquired land has good potential for future development and the same was converted for commercial purpose as per No.C.DIS.ALNSR.117/2002-03. The Arbitrator also obtained the - 9 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 report from the Tahsildar, Puttur to that effect. After considering all the above aspects, the Arbitrator determined the market rate at Rs.1,75,032/- per cent for the acquired land i.e., commercially converted. Admittedly, the said award was not challenged by respondent Nos. 1 to 3 - land owners. 12. Though the appellant challenged the said award by filing an arbitration petition invoking the provision of Section 34(2) of A & C Act before the learned District Judge, the learned District Judge has rightly observed that the appellant has failed to put forth any perversity in the arbitral award passed by respondent No.4 and since the scope of interference is very limited, the learned District Judge dismissed the petition. 13. On re-appreciation of the entire facts and circumstances of the case along with the documents placed before us, we are of the view that the award passed by the Arbitrator-respondent No.4 is justified for the reason that the acquired land is commercially converted land and situated adjoining to the National Highway within the District of Dakshina Kannada. Such being the position, we find no good - 10 - HC-KAR NC: 2025:KHC:28952-DB COMAP No. 441 of 2024 grounds to interfere with the award passed by the Arbitrator- respondent No.4 and the order passed in the Arbitration Petition No.279/2023 by the learned District Judge. 14. It is also pertinent to state that the appellant had not questioned the delay in filing the appeal before the respondent No.4-Arbitrator by the respondent Nos.1 to 3 against the order passed by the respondent No.5-SLAO. Hence, the same cannot be urged at this belated stage. In that view of the matter, the appeal lacks merit and the same is dismissed. Accordingly, we answer the point raised above in the 'affirmative' and pass the following: ORDER The Commercial Appeal is hereby dismissed. SD/- (ANU SIVARAMAN) JUDGE SD/- (RAJESH RAI K) JUDGE PKS/List No.: 1 Sl No.: 14