Allahabad High Court Dismisses Writ Petition Challenging Arbitral Award in Compensation Dispute
Court Upholds Arbitration Mechanism for Disputes Under National Highways Act, 1956; Directs Petitioners to Seek Remedy Under Arbitration Act
In a significant ruling, the Allahabad High Court dismissed a writ petition filed by Ramashankar Yadav and another, challenging the arbitral award regarding compensation for land acquisition under the National Highways Act, 1956. The court, comprising Justices Mahesh Chandra Tripathi and Anish Kumar Gupta, emphasized the importance of adhering to the statutory arbitration framework for resolving such disputes.
The petitioners, residents of Hathras district, contested the compensation awarded for their land, which was acquired for the expansion of National Highway No. 91. Despite the land being converted from agricultural to non-agricultural use, the compensation was initially determined at agricultural rates. After a series of legal proceedings, the Statutory Arbitrator reassessed the compensation, setting it at Rs. 4,000 per square meter, treating the land as non-agricultural.
The petitioners argued that the compensation did not align with the circle rates of Rs. 14,500 and Rs. 12,000 per square meter as notified for their area. However, the High Court held that disputes regarding compensation adequacy should be addressed through the statutory remedy available under Section 34 of the Arbitration and Conciliation Act, 1996, rather than through writ jurisdiction.
The court highlighted that the arbitration mechanism established under Section 3G of the National Highways Act, supplemented by the Arbitration Act, 1996, provides a comprehensive framework for resolving compensation disputes. The court observed that the Arbitrator had substantially complied with judicial directions and had treated the land as non-agricultural, enhancing the compensation accordingly.
Citing several precedents, the court reiterated that writ petitions should not be entertained when an efficacious alternative remedy exists. The ruling underscores the legislative intent to resolve compensation disputes through specialized arbitration, preserving the integrity of the process.
The High Court's decision reinforces the principle that judicial intervention in arbitral awards is permissible only on limited grounds specified under Section 34 of the Arbitration Act. The court dismissed the writ petition as not maintainable, granting liberty to the petitioners to pursue their claims through the appropriate statutory forum.
Bottom Line:
Writ petitions challenging arbitral awards regarding compensation under Section 3G(5) of the National Highways Act, 1956 are not maintainable when an alternate statutory remedy exists under Section 34 of the Arbitration and Conciliation Act, 1996.
Statutory provision(s): Section 34 of the Arbitration and Conciliation Act, 1996, Section 3G(5) and Section 3G(6) of the National Highways Act, 1956, Article 226 of the Constitution of India.
Ramashankar Yadav v. Union of India, (Allahabad)(DB) : Law Finder Doc Id # 2795289
