National Highways Authority of India v. Nihar Ranjan Sahu
2025-06-20
S K Panigrahi
body2025
DailyLaw.ai
JUDGMENT : S.K.PANIGRAHI, J. 1. Since both the Writ Petitions involve a common question of law and substantially similar facts, they are being heard and considered together. However, this Court feels it appropriate to treat W.P.(C) No.27589 of 2024 as the leading case for proper adjudication of both the matters. 2. W.P.(C) No.27589 of 2024has been preferred by the Petitioner challenging the legality and validity of Arbitration Award passed in Misc. (Arbitration) Case No.03/2019, NH - 6 dated 26.12.2023 u/s 3 - G(5) of the NH Act, 1956 passed by the Collector and Arbitrator, Keonjhar which directed the Tahasildar - Cum - CALA, NH - 6, Patna now LAO and CA, NH - 6, Keonjhar to recalculate the land acquisition compensation @ Rs.60,00,000/- per acre towards acquisition of Ac 1.17 dec of land pertaining to Plot No.289,290,297,299, 316, 287/528, 298/530, 311, 312, Khata No. 38/5, Kisam - Taila - I, Village Dumuriguda and to pay the differential compensation along with interest @ 9% over the said amount u/s 3 - H(5) of the NH Act, 1956. I. FACTUAL MATRIX OF THE CASE: 3. The facts giving rise to the present Petition can be pithily summarised as under: a. The present Petitioner is a statutory body established under the NHAI Act, 1988 being the Executing Agency on behalf of the Govt. of India, Ministry of Road Transport and Highways. b. The present private Opposite Parties are the recorded tenants of the subject land. c. That, Govt. of India, Ministry of Road Transport and Highways vide Notification No. S.O. 2768(E) dated 14.9.2013 notified U/s 3A of the N.H. Act 1956 to acquire the above subject land amongst others, in Dumurigoda for expansion of N.H.6 from Km.342+900 to Km.356+400 (Baharagora - Sambatpur Section) in Keonjhar District. The Notification was published u/s 3 - D of the N.H. Act 1956 on 10.9.2014. d. The Tahasildar - cum - Competent Authority, LA, N.H. 6 Project, Patna (hereinafter referred to as CALA) was appointed as the Competent Authority to acquire the land specified in the Schedule annexed to the said notification for building(widening / four - laning, etc.), maintenance, management and operation of National Highway No. 6 e. The CALA conducted detailed survey and after physical verification of plot / area etc. issued notice in favour of the private Respondents to receive land acquisition compensation worth Rs.4,16,863/- as determined in LA Case No.9/4/2016.
issued notice in favour of the private Respondents to receive land acquisition compensation worth Rs.4,16,863/- as determined in LA Case No.9/4/2016. This amount was arrived at by CALA keeping in mind the bench mark valuation report of the Village Dumurigoda @Rs.1,15,000/- per acre as per the cut off date of 14.9.2013 (date of notification). Furthermore, no registered sale deed was available for the Gharabari Kisam in the village during 2011-2013 and therefore, the CALA proceeded on the basis of the available bench mark valuation only. f. Accordingly, CALA passed an award of Rs.4,16,863/- in favour of the private Respondents. This amount has admittedly been disbursed and received by the present Respondents. g. Thereafter, the private Respondents filed Misc. (Arbitration) Case No.03/2019, NH - 6 before the Collector, Keonjhar - Cum - Arbitrator, NH - 6 Project, Keonjhar for redetermination of compensation. h. In Misc. (Arbitration) Case No.03/2019, notice was issued on 23.2.2019. The CALA was duly served and represented by the panel advocate. The defence statement as well as the written arguments were duly filed. i. Vide Arbitration Award passed in Misc. (Arbitration) Case No.03/2019, NH - 6 dated 26.12.2023 the CALA was directed to recalculate the land acquisition compensation @ Rs.60,00,000/- per acre towards acquisition of subject land and to pay the differential compensation alongwith interest @ 9% over the said amount. j. Accordingly, the CALA reassessed the amount and requested the Project Director, NHAI, Keonjhar for sanction of funds to satisfy the Arbitration Award passed in Misc. (Arbitration) Case No.03/2019, NH - 6 dated 26.12.2023. 4. At this juncture, the Petitioner has preferred the present Writ Petition challenging the legality of the award seeking quashing of the same apart from a direction to re - hear the matter after making the Project Director, NHAI, Keonjhar a party. As the facts leading up to the instant Petition have been laid down, this Court shall endeavour to summarise the contentions of the Parties and the broad grounds that have been raised to seek the exercise of this Court's writ jurisdiction. II. PETITIONER'S SUBMISSIONS: 5.The Ld. Counsel for the Petitioner submits that the Arbitral Award is illegal and invalid as the NHAI being the Executing Agency was not impleaded as a Party, nor was the Central Government given an opportunity of hearing. 6.
II. PETITIONER'S SUBMISSIONS: 5.The Ld. Counsel for the Petitioner submits that the Arbitral Award is illegal and invalid as the NHAI being the Executing Agency was not impleaded as a Party, nor was the Central Government given an opportunity of hearing. 6. Furthermore, it is contended that impugned award does not satisfy S.31 of the A and C Act and is therefore liable to be quashed. III. OPPOSITE PARTY NO. 1'S SUBMISSIONS: 7. On the other hand, Ld. Counsel for the private Opposite Party submits that the CALA was the Competent Authority empowered to conduct affairs on behalf of the Central Government. As such, the CALA was heard and the Arbitral Award was arrived at only after affording an opportunity of hearing to both parties. In this view of the matter, the NHAI being the Executing Agency need not be separately impleaded as it has been duly represented by an authority acting as it's agent. 8. Furthermore, it is submitted that the statutory scheme does not envision a scenario where the Central Government has to be heard separately from its Competent Authority, i.e. CALA. IV. ISSUES FOR CONSIDERATION: 9. Having heard the parties and perused the materials available on record, this court here has identified the following issues to be determined: A. Whether this Court can exercise its writ jurisdiction in the realm of arbitral awards? B. Whether this Court ought to interfere in the facts of the present case? V. ISSUE A: WHETHER THIS COURT CAN EXERCISE ITS WRIT JURISDICTION IN THE REALM OF ARBITRAL AWARDS? 10. As to what would be the scope of interference under Art.226/227 against orders passed by the Arbitral Tribunals, a number of judgments have been cited by both parties, however, recent decisions of the Supreme Court and of this Court have settled the issue. 11. While there is no doubt that the arbitral tribunal is a tribunal over which writ jurisdiction can be exercised, the said interference by a writ court is limited in nature. Recently, in Deep Industries Ltd. v. ONGC Ltd. 2020 (15) SCC 706 decided on 28th November, 2019, the Supreme Court considered S.B.P. and Company v. Patel Engineering Ltd. 2005 (8) SCC 618 : ( AIR 2006 SC 450 ) and Fuerst Day Lawson Limited v. Jindal Exports Limited 2011 (8) SCC 333 : ( AIR 2011 SC 2649 ) and observed as under: "17.
This being the case, there is no doubt whatsoever that if petitions were to be filed Under Art.226/227 of the Constitution against orders passed in appeals Under S.37, the entire arbitral process would be derailed and would not come to fruition for many years. At the same time, we cannot forget that Art.227 is a constitutional provision which remains untouched by the non - obstante Clause of S.5 of the Act. In these circumstances, what is important to note is that though petitions can be filed Under Art.227 against judgments allowing or dismissing first appeals Under S.37 of the Act, yet the High Court would be extremely circumspect in interfering with the same, taking into account the statutory policy as adumbrated by us herein above so that interference is restricted to orders that are passed which are patently lacking in inherent jurisdiction." 12. Recently, in Surender Kumar Singhal v. Arun Kumar Bhalotia , 2021 SCC OnLine Del. 3708 the Delhi High Court, after considering all the decisions, of the Supreme Court, Deep Industries (supra); Bhaven Construction v. Sardar Sarovar Narmada Nigam Ltd. 2022 (1) SCC 75 ; Punjab State Power Corpn. 6 Ltd. v. EMTA Coal Ltd. 2020 (17) SCC 93 ; Virtual Perception OPC (P) Ltd. v. Panasonic India (P) Ltd. 2022 SCC OnLine Del. 566 and Ambience Projects and Infrastructure (P) Ltd. v. Neeraj Bindal, 2021 SCC OnLine Del. 4023 has laid down circumstances in which such petitions ought to be entertained. The relevant portion of the said judgment reads as under: "24. A perusal of the abovementioned decisions, shows that the following principles are well settled, in respect of the scope of interference under Art.226/227 in challenges to orders by an Arbitral Tribunal including orders passed under S.16 of the Act: (i) An Arbitral Tribunal is a tribunal against which a petition under Art.226/227 would be maintainable. (ii) The non obstante clause in S.5 of the Act does not apply in respect of exercise of powers under Art.227 which is a constitutional provision. (iii) For interference under Art.226/227, there have to be exceptional circumstances. (iv) Though interference is permissible, unless and until the order is so perverse that it is patently lacking in inherent jurisdiction, the writ court would not interfere. (v) Interference is permissible only if the order is completely perverse i.e. that the perversity must stare in the face.
(iii) For interference under Art.226/227, there have to be exceptional circumstances. (iv) Though interference is permissible, unless and until the order is so perverse that it is patently lacking in inherent jurisdiction, the writ court would not interfere. (v) Interference is permissible only if the order is completely perverse i.e. that the perversity must stare in the face. (vi) High Courts ought to discourage litigation which necessarily interfere with the arbitral process. (vii) Excessive judicial interference in the arbitral process is not encouraged. (viii) It is prudent not to exercise jurisdiction under Art.226/227. (ix) The power should be exercised in "exceptional rarity" or if there is, "bad faith" which is shown. (x) Efficiency of the arbitral process ought not to be allowed to diminish and hence interdicting the arbitral process should be completely avoided." 26. A perusal of the above would show that it is only under exceptional circumstances or when there is bad faith or perversity that writ petitions ought to be entertained." 13. The power of superintendence vested in High Courts under Art.227 of the Constitution of India is a constitutional safeguard designed to ensure that subordinate courts and tribunals act within their jurisdiction and adhere to principles of fairness, legality, and procedural propriety. However, the exercise of this power in the context of arbitration proceedings governed by the Arbitration and Conciliation Act, 1996, has been subject to considerable judicial scrutiny and debate. The Arbitration Act is a self - contained code aimed at promoting minimal judicial interference and ensuring the speedy resolution of disputes through a quasi - judicial process. S.5 of the Act categorically mandates that judicial authorities shall not intervene in matters governed by the Act, except where expressly provided. This non obstante clause, coupled with the limited appellate mechanism under S.37, underscores a deliberate legislative intent to restrict court involvement and expedite the arbitral process. The Supreme Court in SBP and Co. v. Patel Engg. Ltd. 2005 (8) SCC 618 : ( AIR 2006 SC 450 ) emphasized the autonomy of the arbitral process, affirming that courts must respect the statutory scheme. While Art.227 is a constitutional provision and therefore cannot be ousted by statutory language, the Courts have repeatedly held that this extraordinary jurisdiction must be exercised with great restraint, especially in arbitration matters.
Ltd. 2005 (8) SCC 618 : ( AIR 2006 SC 450 ) emphasized the autonomy of the arbitral process, affirming that courts must respect the statutory scheme. While Art.227 is a constitutional provision and therefore cannot be ousted by statutory language, the Courts have repeatedly held that this extraordinary jurisdiction must be exercised with great restraint, especially in arbitration matters. Any intervention should be confined to cases where there is a patent lack of jurisdiction or perversity that is apparent on the face of the record. The overarching goal is to preserve the integrity and efficiency of the arbitral process. 14. In recent judicial pronouncements, including Deep Industries (supra), the Apex Court has emphasized that although Art.227 cannot be curtailed by any statutory enactment like S.5 of the Arbitration and Conciliation Act, the High Courts must exercise self - restraint while considering interference in arbitral proceedings. The Court acknowledged the supremacy of the constitutional provision but cautioned that indiscriminate use of writ jurisdiction would undermine the legislative objective of speedy and efficient dispute resolution through arbitration. It observed that entertaining petitions under Art.226 or 227 against interlocutory or even final orders passed under S.16 or 17 of the Arbitration Act would result in delaying the arbitral process and open floodgates for unwarranted challenges. Importantly, the Court held that only in instances where the order suffers from a patent lack of jurisdiction or where there is a manifest miscarriage of justice should the High Court step in. The rationale was rooted in the principle that arbitral tribunals, while not civil courts, are adjudicatory bodies that derive their authority from party autonomy and statutory recognition. Excessive judicial interference in this sphere would erode the foundational principles of arbitration and compromise its purpose as an alternate dispute resolution mechanism. The Court thus laid down a threshold of "exceptional rarity" as a guiding principle. Consequently, even if maintainability under Art.227 is established, the jurisdiction ought not to be exercised merely because an error of law or fact exists, unless such error amounts to perversity or a jurisdictional transgression. The Court was particularly wary of the potential derailment of the arbitral process if supervisory jurisdiction were exercised routinely over orders passed either by arbitral tribunals or in first appeals under Page 10 S.37 of the Act.
The Court was particularly wary of the potential derailment of the arbitral process if supervisory jurisdiction were exercised routinely over orders passed either by arbitral tribunals or in first appeals under Page 10 S.37 of the Act. Acknowledging the supremacy of the Constitution and the enduring nature of Art.227, the Court nevertheless maintained that statutory policy must be respected and judicial review should not be used as a backdoor appeal mechanism. The Court held that although the power under Art.227 is untouched by the non obstante clause in S.5, such power must be exercised with utmost circumspection and only in cases where orders are so patently lacking in inherent jurisdiction or are manifestly perverse that judicial conscience is shocked. This nuanced stance balances constitutional principles with statutory purpose. The Court further explained that if Art.227 petitions were freely entertained against S.37 orders, it would negate the legislative scheme that provides for only a single appeal and bars second appeals under S.37(3). Consequently, High Courts must tread carefully, ensuring that their intervention does not undermine the finality and expedition that the Arbitration Act seeks to promote. This decision thus reinforces the principle that while constitutional remedies remain available, they are not to be used as substitutes for appeals explicitly barred by a self - contained statute such as the Arbitration and Conciliation Act. 15. The decision in Surender Kumar Singhal (supra), further crystallized the judicial standards governing Art.227 interference in arbitral matters. After analyzing key Supreme Court precedents, the Delhi High Court unequivocally held that the supervisory power under Art.227 can only be exercised when there is demonstrable perversity or the order of the arbitral tribunal is patently without jurisdiction. The Court noted that arbitral tribunals, being private adjudicatory bodies created under the Arbitration and Conciliation Act, 1996, are distinct from statutory or constitutional tribunals. Despite this, given their function of adjudicating legal disputes and their obligation to adhere to principles of natural justice, they fall within the scope of judicial review under Art.227. However, the Act's statutory framework, particularly S.5 and S.37, reflects a clear legislative intent to restrict judicial intervention. S.5's non obstante clause ensures that in matters governed by the Act, no judicial authority shall intervene unless specifically provided. S.37, by allowing a limited and exhaustive list of appealable orders, reinforces the notion of finality and minimal interference.
However, the Act's statutory framework, particularly S.5 and S.37, reflects a clear legislative intent to restrict judicial intervention. S.5's non obstante clause ensures that in matters governed by the Act, no judicial authority shall intervene unless specifically provided. S.37, by allowing a limited and exhaustive list of appealable orders, reinforces the notion of finality and minimal interference. The Court warned that permitting Art.227 challenges as a routine remedy would effectively create a "second bite at the cherry," contrary to the Arbitration Act's policy and purpose. Therefore, only orders reflecting egregious illegality or mala fides warrant constitutional scrutiny. The judgment also crystallized the principles governing the exercise of writ jurisdiction over arbitral orders, emphasizing that such powers under Art.227 must be exercised only in the rarest of rare cases. The decision made clear that arbitral tribunals, though private in nature, are still "tribunals" within the meaning of Art.227 and therefore subject to the High Court's supervisory control. However, this supervisory control is not equivalent to appellate review. Rather, the writ court's role is confined to correcting manifest illegality, bad faith, or perversity so glaring that it indicates a patent lack of jurisdiction. The High Court reiterated that if orders passed by arbitral tribunals were routinely challenged and overturned under Art.227, it would ify the entire purpose of a separate arbitration regime and revert the process to the very judicial delays it sought to eliminate. The judgment stressed the necessity of discouraging such litigation unless the arbitral order offends the basic structure of justice. 16. While Art.227 cannot be statutorily ousted due to its constitutional origin, its invocation must be exercised with extreme caution in arbitration matters. If High Courts were to routinely entertain petitions under Art.227 against orders passed under S.37 of the Arbitration Act, the entire purpose of creating a streamlined arbitral regime would be frustrated. Arbitration proceedings, by their very nature, are intended to be quick and efficient alternatives to traditional litigation. Excessive judicial interference undermines this objective and delays finality in commercial disputes. Interference of this Court under Art.227 is not only exceptional but should be exercised in situations where the order in question is so perverse that it lacks inherent jurisdiction. It reaffirmed that routine errors of law or fact, or disagreements on the merits, cannot be grounds for invoking this extraordinary jurisdiction.
Interference of this Court under Art.227 is not only exceptional but should be exercised in situations where the order in question is so perverse that it lacks inherent jurisdiction. It reaffirmed that routine errors of law or fact, or disagreements on the merits, cannot be grounds for invoking this extraordinary jurisdiction. The policy underlying the Arbitration Act, reinforced by its non obstante clause in S.5 and constricted appellate structure in S.37, demands judicial deference to arbitral decisions. Therefore, unless there is an egregious illegality or an abuse of power that offends basic judicial conscience, this Court must refrain from invoking Art.227. VI. ISSUE B: WHETHER THIS COURT OUGHT TO INTERFERE IN THE FACTS OF THE PRESENT CASE? 17. Sections 3A to 3 - J of the National Highways Act, 1956 ("NH Act") exhaustively delineates the process of land acquisition, compensation determination, and disbursal. These provisions collectively establish a self - contained and comprehensive framework. The entire process, from notification of intent to acquire land to the final disbursement of compensation, is conducted under statutory authority. The Competent Authority for Land Acquisition (CALA) plays a central role in administering this process. 18. Arbitration proceedings under S.3G(5), intended to resolve disputes regarding compensation, occur exclusively between the person interested in the land and the CALA. This statutory design, carefully structured by Parliament, intentionally omits the necessity of involving NHAI or its officers, such as the Project Director, thereby affirming that their presence is not a condition precedent for the validity of arbitration proceedings. 19. The Competent Authority acts throughout the acquisition process as the delegate of the Central Government. This statutory delegation encompasses responsibilities ranging from issuing initial notifications under S.3A, hearing objections under S.3C, determining compensation under S.3G(1), and ultimately disbursing compensation under S.3H. At every stage, the CALA functions not in a personal capacity but as the legally recognized agent of the Union. Consequently, when disputes arise regarding the amount of compensation and arbitration is invoked under S.3G(5), the CALA alone is statutorily authorized to represent the acquiring authority. No provision in the NH Act requires or authorizes any officer of the NHAI to participate in this process. This legislative structure ensures a consistent and streamlined adjudication mechanism and precludes the introduction of administrative entities, like NHAI, which have no statutory adjudicatory role under the NH Act. 20.
No provision in the NH Act requires or authorizes any officer of the NHAI to participate in this process. This legislative structure ensures a consistent and streamlined adjudication mechanism and precludes the introduction of administrative entities, like NHAI, which have no statutory adjudicatory role under the NH Act. 20. While NHAI may initiate the request for land acquisition and is required to deposit the estimated compensation, its role is administrative and financial, not adjudicatory or representational. The NH Act does not contemplate any scenario in which the requisitioning body - NHAI - would assume a legal persona capable of representing the acquiring authority in disputes over compensation. The distinction between the requisitioning authority and the acquiring authority ought to be clearly preserved. The acquiring authority under the NH Act is the Central Government, represented solely by the Competent Authority. Legal challenges seeking to invalidate arbitral awards for non - implement of NHAI ignore this statutory distinction and attempt to confer a status on NHAI that the legislation deliberately withholds. 21. The National Highways Rules, 2019 further reinforce the position that NHAI has no legal role in arbitration under S.3G(5). These rules prescribe the procedures for deposit and disbursement of compensation funds but do not confer any adjudicatory or representative function upon NHAI. Instead, the rules make it clear that the funds are routed through and utilized by the CALA, who remains the sole functional and legal entity in charge of the acquisition process. By detailing only the financial flow and administrative obligations of the NHAI, the Rules reinforce its non - adjudicatory status. There is no clause or provision in these Rules that implies a requirement for NHAI's presence in legal or arbitral proceedings. This regulatory silence, in the face of exhaustive statutory and rule - based structuring of the acquisition and compensation mechanism, underscores the deliberate legislative exclusion of NHAI from such proceedings. 22. A basic principle of statutory interpretation is that where a statute provides a specific method for performing a duty or exercising a power, that method must be strictly followed. This principle, known as the doctrine of expression unius est exclusion alterius, supports the view that the NH Act's exclusive delegation of compensation responsibilities to the CALA implies the exclusion of all others, including NHAI. The Act does not envisage dual or parallel representation in arbitration proceedings. CALA's role is defined and exhaustive.
This principle, known as the doctrine of expression unius est exclusion alterius, supports the view that the NH Act's exclusive delegation of compensation responsibilities to the CALA implies the exclusion of all others, including NHAI. The Act does not envisage dual or parallel representation in arbitration proceedings. CALA's role is defined and exhaustive. To introduce another party into this framework would require legislative amendment, not judicial intervention. Any procedural challenge to an arbitral award premised on the absence of NHAI as a party fails to appreciate this strict statutory scheme and misreads the role envisaged for each stakeholder under the Act. 23. The argument that the non - impleadment of NHAI vitiates the arbitral award is inherently flawed. Once the CALA is impleaded, it is deemed that the acquiring authority - the Central Government - is effectively represented. The NHAI operates under the administrative control of the Ministry of Road Transport and Highways, which in turn is the nodal ministry overseeing the acquisition. The award passed under S.3G(5) remains valid and enforceable so long as the parties recognized under the statute - the person interested and the Competent Authority - are before the arbitral tribunal. To hold otherwise would not only be contrary to the statutory mandate but would also undermine the finality and purpose of the arbitration mechanism provided under the NH Act. 24. The Supreme Court and several High Courts have consistently held that procedures for land acquisition and compensation must be rigorously followed in accordance with statutory prescriptions. Land acquisition touches upon fundamental property rights under Art.300A of the Constitution, and the statutory framework must be construed strictly. The NH Act, by design, excludes NHAI from the compensation adjudication process. Hence, allowing a challenge to an arbitral award on the ground that NHAI was not impleaded runs afoul of these established principles. The law does not recognize a procedural defect in such omission where the necessary parties under the statute are properly represented. 25. Any grievance that NHAI may harbour regarding the amount of compensation or the arbitral award must be routed through the Competent Authority. This centralized channeling of concerns ensures consistency and clarity in representation. If multiple agencies were permitted to participate or contest compensation disputes, it would lead to legal uncertainty and procedural confusion.
25. Any grievance that NHAI may harbour regarding the amount of compensation or the arbitral award must be routed through the Competent Authority. This centralized channeling of concerns ensures consistency and clarity in representation. If multiple agencies were permitted to participate or contest compensation disputes, it would lead to legal uncertainty and procedural confusion. Furthermore, this would erode the authority vested in the CALA and dilute the purpose of creating a single statutory interface between the acquiring body and affected persons. Judicial economy and administrative efficacy demand that such representation remain unified. 26. The assertion that an arbitral award is invalid for non - joinder of NHAI overlooks the statutory fiction embedded in the Act. The Competent Authority, once appointed and vested with powers under the Act, steps into the shoes of the Central Government for the purposes of acquisition and compensation. This substitution is not administrative but legal. It follows that any action taken or defended by the CALA in arbitral proceedings is binding on the Central Government and, by extension, on all its departments, including the administrative apparatus under which NHAI functions. Consequently, the challenge based on NHAI's non - inclusion lacks legal merit and must be rejected in light of the representative sufficiency of the Competent Authority. 27. Sections 3G(5) of the National Highways Act, 1956, provides for arbitration in cases where the amount of compensation determined by the Competent Authority is not acceptable to either party. The statute does not create an open forum where any interested administrative body may claim participation. Rather, it sets up a targeted mechanism where the dispute is exclusively between the person interested in the land and the Competent Authority, who stands in for the Central Government. 28. The rule of law dictates that tribunals and courts must adhere to the boundaries established by legislation. In the case of acquisition and compensation under the NH Act, the statutory structure is unambiguous. It assigns clearly delineated roles to designated authorities and leaves no scope for interpretive expansion to administrative agencies not vested with legal authority. The reliance on NHAI's financial role to assert its legal necessity misunderstands the difference between financial obligation and legal standing. While NHAI may be tasked with transferring funds to the CALA for the purposes of compensation, this fiscal duty does not translate into a participatory right in arbitral proceedings.
The reliance on NHAI's financial role to assert its legal necessity misunderstands the difference between financial obligation and legal standing. While NHAI may be tasked with transferring funds to the CALA for the purposes of compensation, this fiscal duty does not translate into a participatory right in arbitral proceedings. The structure of the NH Act maintains a strict demarcation between financial facilitation and legal adjudication. Moreover, recognizing NHAI as a party would amount to revising the statutory framework to include a stakeholder expressly excluded by Parliament. This Court cannot permit such a revision by implication, especially in a context where statutory precision is essential to safeguard the constitutional right to property. 29. It is also pertinent to underscore that participation in arbitration proceedings cannot be justified on administrative convenience or internal governmental arrangements. The arbitration envisaged under S.3G(5) is a quasi - judicial process governed by the principles of natural justice and bound by the four corners of statutory authorization. Any party that seeks to be impleaded must demonstrate a clear legal mandate to be present. The NHAI's function as a requisitioning authority, while significant from an operational standpoint, does not confer it with a legal right to represent the acquiring authority or contest compensation determinations. Moreover, if the NHAI has concerns regarding an arbitral award, the proper course is to act through the Competent Authority or seek remedy through the administrative mechanisms available under its parent Ministry. It cannot independently interject into arbitration proceedings or be considered an indispensable party in a process that was never designed to accommodate its presence. 30. The submission that an arbitral award is vitiated for want of NHAI's impleadment presumes that the NHAI possesses a protectable interest in the quantum or method of compensation - an assumption not borne out by the statutory text. The NH Act does not grant NHAI independently, the power to determine or contest compensation. Its role is limited to initiating acquisition and funding compensation. The legal effect of compensation determinations, including arbitral awards, binds the Central Government, represented through the Competent Authority, not NHAI. Legal proceedings cannot accommodate every stakeholder with peripheral or logistical interests; only those with a legal nexus to the core issue may be heard as necessary parties. Therefore, an arbitral award passed under S.3G(5) remains unassailable merely on account of NHAI's personal absence from the record. 31.
Legal proceedings cannot accommodate every stakeholder with peripheral or logistical interests; only those with a legal nexus to the core issue may be heard as necessary parties. Therefore, an arbitral award passed under S.3G(5) remains unassailable merely on account of NHAI's personal absence from the record. 31. It is on record that the Competent Authority for Land Acquisition (CALA), who is the statutory delegate of the Central Government under the NH Act, actively participated in the arbitration proceedings and submitted objections before the Arbitrator. This participation satisfies the legal requirement of representation of the acquiring authority in terms of S.3G(5). Since the CALA functions not in an individual or discretionary capacity but as the appointed representative of the Central Government, its involvement is equivalent in law to the presence of the acquiring authority itself. Once the arbitral award is rendered and the Competent Authority is a party thereto, NHAI cannot claim that the absence of its impleadment renders the award infirm. Such an argument, raised post facto, is devoid of legal basis and contrary to the legislative scheme that treats the Competent Authority as the exclusive representative for such disputes. 32. The NH Act does not contemplate a dual - channel mechanism where both the Competent Authority and the NHAI can represent the Central Government or participate in compensation disputes in parallel. If NHAI, or any officer under it, disagrees with the outcome of arbitration, the proper and legally tenable course of action is to instruct the Competent Authority to challenge the award, if grounds so exist. A direct challenge by NHAI, on the plea that it was not a party to the arbitration, misconstrues the procedural safeguards built into the statute. Such a challenge disregards the representative capacity of the CALA and implies a requirement of impleading multiple Government functionaries in every arbitration, which the statute neither requires nor permits. Moreover, this approach would open the floodgates to collateral challenges on hyper - technical grounds, even where the correct authority has already participated and submitted its case. The objective of the NH Act - to streamline and expedite land acquisition for public purposes - would be severely undermined if arbitral awards could be destabilized merely on the basis of internal administrative structure or inter - departmental dissatisfaction. The integrity of arbitration proceedings would be eroded, and public projects adversely affected. 33.
The objective of the NH Act - to streamline and expedite land acquisition for public purposes - would be severely undermined if arbitral awards could be destabilized merely on the basis of internal administrative structure or inter - departmental dissatisfaction. The integrity of arbitration proceedings would be eroded, and public projects adversely affected. 33. It is a well - settled principle that courts exercising writ jurisdiction under Art.226 of the Constitution must act with circumspection when reviewing arbitral awards, especially in the absence of manifest illegality, jurisdictional error, or violation of natural justice. The present matter involves no such infirmity. The parties contemplated under the statute - the landowners and the Competent Authority - were present before the Arbitrator. Due process was followed, objections were recorded, and an award was passed. NHAI, not being a statutory party to such proceedings, cannot now invoke the writ jurisdiction of this Court merely on the premise that it was not personally heard or impleaded. Writ jurisdiction does not lie against arbitral awards where the grievance pertains to internal administrative dissatisfaction, particularly where the statute vests adjudicatory authority in a different agency altogether. The legislative intent behind S.3G(5) was to create a swift and final mechanism for resolving compensation disputes through arbitration. To allow a non - statutory party like the NHAI to raise belated procedural objections would defeat the purpose of this alternate dispute resolution framework and encourage avoidable litigation. This Court, therefore, finds no exceptional circumstance justifying interference with the arbitral award under writ jurisdiction. VII. CONCLUSION: 34. Public law remedies are not designed to accommodate inter - agency disputes where the statutory procedure has otherwise been followed. In light of the foregoing, this Court finds that the absence of the National Highways Authority of India from arbitration proceedings under S.3G(5) of the NH Act does not constitute a procedural or legal infirmity capable of vitiating the arbitral award. The participation of the Competent Authority ensures that the acquiring body - the Central Government - was duly represented, and no breach of natural justice or statutory requirement is disclosed. If NHAI seeks to challenge the award on substantive grounds, it must do so through the Competent Authority and not by asserting an independent right of participation. Any other interpretation would not only conflict with the statutory text but also open the door to administrative overreach and legal uncertainty. 35.
If NHAI seeks to challenge the award on substantive grounds, it must do so through the Competent Authority and not by asserting an independent right of participation. Any other interpretation would not only conflict with the statutory text but also open the door to administrative overreach and legal uncertainty. 35. Both the Writ Petitions are, accordingly, dismissed. There shall, however, be no orders as to costs. 36. Interim order, if any, passed earlier stands vacated.