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Paul Mani & Others v/s The Special Deputy Collector & Competent Authority (Salo), NHDP, Thrissur & Another

    Arb.A. Nos. 18, 21 & 22 of 2018

    Decided On, 05 August 2019

    At, High Court of Kerala

    By, THE HONOURABLE MR. JUSTICE C.T. RAVIKUMAR & THE HONOURABLE MR. JUSTICE N. NAGARESH

    For the Appellant: Raju K. Mathews, George Mecheril, Advocates. For the Respondents: Renil Anto Kandamkulathy, G.P., K.R. Deepa, Sr. Government Pleader, Thomas Antony, Advocate.



Judgment Text

Ravikumar, J.

1. The captioned appeals are preferred by awardees of compensation for acquisition of land, in different extent, under the National Highways Act, 1956 (N H Act), for the purpose of widening of National Highway 47 from Mannuthy to Wadakkancherry. Since the same issues pose for resolution in all the appeals they were heard simultaneously and are being disposed of by this common judgment. Shorn of detail the basic facts in each of the cases are as follows:-

Arb.A.No.18 of 2018

It relates to the acquisition of 7.45 Ares of land comprised in Survey No.20/5 of Pananchery Village from the appellant herein. The Land Acquisition Officer passed an award granting land value of Rs.4,25,000/- per Are and Rs.19,40,042/- towards value of structures and Rs.55,000/-towards incidental expenses and shifting charges. The Arbitrator enhaced the compensation under each of the aforesaid heads viz., Rs.17,04,340/- additionally towards land value payable, an amount of Rs.8,61,794/- additionally towards value of structures and an amount of Rs.55,000/- additionally towards incidental and shifting charges. It is dissatisfied with the quantum of enhancement that the petitioner preferred an application before the District Court, Thrissur under Section 34(1) of the Arbitration and Conciliation Act, 1996 (for brevity 'Arbitration Act'). The District Court as per the order in OP(Arbitration)No.744/2013 dismissed the petition.

Arb.A.No.21 of 2018

It relates to the acquisition of 7.45 Ares of land comprised in Survey No.20/5 of Pananchery Village from the appellant herein. The Land Acquisition Officer passed an award gra

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nting land value of Rs.4,25,000/- per Are and Rs.15,36,187/- towards value of structures and Rs.55,000/-towards incidental expenses and shifting charges. The Arbitrator enhaced the compensation under the aforesaid heads viz., Rs.20,12,990/- additionally towards land value payable, an amount of Rs.6,98,045/- enhanced towards value of structures and an amount of Rs.55,000/- towards incidental and shifting charges. It is dissatisfied with the quantum of enhancement that the petitioner preferred an application before the District Court, Thrissur under Section 34(1) of the Arbitration Act. The District Court as per the order in OP(Arbitration)No.784/2013 dismissed the petition.

Arb.A.No.22 of 2018

It relates to the acquisition of 8.52 Ares of land comprised in Survey No.552/1, 3082/17 of Peechi Village from the appellant herein. The Land Acquisition Officer passed an award granting land value of Rs.4,25,000/- per Are and Rs.19,04.042/- towards value of structures and Rs.55,000/-towards incidental expenses and shifting charges. The Arbitrator enhaced the compensation under each of the aforesaid heads viz., Rs.25,52,484/- additionally towards land value payable, an amount of Rs.10,90,478/- additionally towards value of structures and an amount of Rs.55,000/- additionally towards incidental and shifting charges. It is dissatisfied with the rate of enhancement that the petitioner preferred an application before the District Court, Thrissur under Section 34(1) of the Arbitration Act. The District Court as per the order in OP(Arbitration)No.758/2013 dismissed the petition.

2. The appellants challenge the aforesaid orders in the respective OP(Arbitration) filed under Section 34(2) of the Arbitration Act raising various contentions. The contention is that the District Court went wrong in holding that in respect of acquisition effected under the N H Act, in a petition under Section 34 of the Arbitration Act, Award of the Arbitrator could be challenged only on any of the grounds specified under Section 34 (2) (a) (i) to (v) and (b) (i) and (ii) of the Arbitration Act. The District Court held that in the absence of any grounds envisaged under the aforesaid section of the Arbitration Act an Arbitral Award could not be interfered with. It is consequent to such conclusions and findings that the petitions filed by the appellants herein under Section 34(1) of the Arbitration Act were dismissed.

3. The contention of the appellants is that, the District Court went wrong in holding that interference with the Awards passed by the Arbitrator in respect of acquisition under the N H Act, invoking the procedures under the Arbitration Act is possible only on establishing any one of the grounds under Section 34(2) of the Arbitration Act. It is specifically stated in the appeals that though claim for solatium and interest on solatium under the Land Acquisition Act, 1894 (L A Act) was made, the District Court held that there is no reason to interfere with the rejection of said claim by the Arbitrator as in view of Section 3J of the N H Act , the provisions under the L A Act are inapplicable. The question is whether those grounds for dismissal are legally correct and sustainable?

4. Firstly, we will consider the tenability of the contentions raised against the rejection of the claim for solatium and interest on solatium under the L A Act. Learned counsel submitted that the rejection of the claim for solatium and interest as in the case of allowable under Section 23(2) and 28 of the L A Act cannot be sustained in the light of the decision of the Apex Court in Sunita Mehra and Ors v. Union of India (UOI) and Ors reported in 2016 (8) SCALE 582. Obviously, after referring to its earlier decision in Gurpeet Singh v. Union of India reported in (2006) 8 SCC 457 whereunder in respect of acquisition under the N H Act it was held that the benefit of solatium and interest on solatium in view of the provisions under Section 23(2) and 28 of the L A Act are available in respect of proceedings pending till 28.03.2008. In such circumstances it is submitted that the appellants ought to have been granted solatium and interest on solatium despite the provisions under Section 3J of the N H Act, making the provisions under the L A Act, inapplicable.

5. Learned Standing Counsel appearing for the National Highway Authority would submit that in the light of Section 3J of the N H Act the District Court cannot be said to have committed an error in declining the benefit of solatium and interest on solatium available under Section 23(2) and 28 of the L A Act.

6. As already stated the appelants' specific claim for solatium and interest on solatium was rejected by the District court citing provisions under Section 3J of the NH Act. Section 3J of the NH Act, reads thus:-

5. “3J. Land Acquisition Act 1 of 1894 not to apply.- Notwithstanding in the Land Acquisition Act, 1894 shall apply to an acquisition under this Act.”

7. In the context of the contentions advanced based on Section 3J of the N H Act and taking note of the fact that solatium and interest on solatium were denied to the appellants based on Section 3J of the N H Act it is only appropriate to refer to the decision of the Hon'ble High Court of Punjab and Haryana in M/s.Golden Iron & Steel Forgings v. Union of India in CMP No.11461 of 2005 dated 28.03.2008. The Hon'ble High Court of Punjab and Haryana held Section 3J to be violative of Article 14 of the Constitution of India. It was held there in thus:-

“We, therefore, strike down Section 3J and 3G of the Act as arbitrary and violative of Article 14 of the Constitution, in so far as they deny payment of solatium and interest and hold that landowners, who are compulsorily diverted of their property under the impugned statute would henceforth be entitled to solatium and interest as envisaged by the provisions of Section 23 and Section 28 of the Land Acquisition Act.”

8. In view of the position obtained from the decision in Golden Iron & Steel Forging's case (supra) the decision of the Hon'ble Apex Court in Kusum Ingots & Alloys Ltd. v. Union of India and another reported in (2004) 6 SCC 254 would assume relevance. Paragraphs 21 and 22 therein read thus:-

“21. A parliamentary legislation when it receives the assent of the President of India and is published in the Official Gazette, unless specifically excluded, will apply to the entire territory of India. If passing of a legislation gives rise to a cause of action, a writ petition questioning the constitutionality thereof can be filed in any High Court of the country. It is not so done because a cause of action will arise only when the provisions of the Act or some of them which were implemented shall give rise to civil or evil consequences to the petitioner. A writ court, it is well settled, would not determine a constitutional question in a vacuum.

22. The Court must have the requisite territorial jurisdiction. An order passed on a writ petition questioning the constitutionality of a parliamentary Act, whether interim or final keeping in view the provisions contained in clause (2) of Article 226 of the Constitution of India, will have effect throughout the territory of India subject of course to the applicability of the Act.”

Thus in view of the conjoint impact of the aforesaid decisions there can be no doubt that the District Court ought not to have relied on Section 3J of the N H Act to deny solatium and interest on solatium, to the appellants.

9. Now, we will consider the contentions in the said question.

10. In view of the decision of the Apex Court in the decision in Sunita Mehra's case (supra) rendered after referring to its earlier decision in Gurpeet Singh's case (supra) the Apex Court held thus:-

“We have considered the submissions advanced. In Gurpeet Singh v. Union of India MANU/SC/4736/2006 : (2006) 8 SCC 457, this Court, though in a different context, had restricted the operation of the judgment of this Court in Sunder v. Union of India, MANU/SC/1680/2001 : (2001) 7 SCC 211 and had granted the benefit of interest on solatium only in respect of pending proceedings. We are of the view that a similar course should be adopted in the present case also. Accordingly, it is directed that the award of solatium and interest on solatium should be made effective only to proceedings pending on the date of the High Court order in Golden Iron & Steel Forgings v. Union of India and Ors. i.e. 28.03.2008. Concluded cases should not be opened. As for future proceedings, the posititon would be covered by the provisions of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (came into force on 01.01.2014) which Act has been made applicable to acquisitions under the National Highways Act, 1956 by virtue of notification/order issued under the provisions of the Act of 2013.”

11. Now, the question is whether the proceedings were pending on the date of the decision of the High Court in Golden Iron & Steel Forgings' case (supra) viz., on 28.03.2008? It is submitted by both the sides that proceedings in connection with the acquisition of land under N H Act from the appellants were pending on 28.03.2008. Hence, the appellants are entitled to solatium and interest on solatium in terms similar to those contained under Sections 23(2) and 28 of the L A Act. In Sunita Mehra's case the Hon'ble Apex Court held that the appellants therein are to be paid solatium and interest on solatium

12. The next question is whether the finding of the District Court that in a petition filed under Section 34(1) of the Arbitration Act, in respect of acquisition effected under the NH Act, interference with the Arbitral Award is permissible only if any of the grounds available under Section 34(2) (a) (i) to (v) and (b) (i) and (ii) of the Arbitration Act, can be sustained? In the contextual situation it is only appropriate to refer to Section 3G (6) and (7) of the said Act and they read thus:-

“(6) Subject to the provisions of this Act, the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall apply to every arbitration under this Act.

(7) The competent authority or the arbitrator while determing the amount under sub-section (1) or sub-section (5), as the case may be, shall take into consideration-

(a) the market value of the land on the date of publication of the notification under section 3A;

(b) the damage, if any, sustained by the person interested at the time of taking possession of the land, by reason of the severing of such land from other land;

(c) he damage, if any, sustained by the person interested at the time of taking possession of the land, by reason of the acquisition injuriously affecting his other immovable poperty in any manner, or his earnings;

(d) if, in consequences of the acquisition of the land, the person interested is compelled to change his residence or place of business, the reasonable expenses, if any, incidental to such change.”

(underline supplied)

13. Going by Section 3G (6) of the N H Act the provisions of Arbitration Act would apply to every arbitration only subject to the provisions of N H Act. Section 3G (7) of the N H Act further provides that the cometent authority or the arbitrator while determining the amount under sub-section (1) or sub-section (5), shall take into consideration the matter specifically enlisted thereunder as (a) to (d). Needless to say that on a perusal of clause (a) to (d) of sub-section(7) of Section 3G would reveal that for determining the amount under those heads evidence is to be adduced by the claimant concerned. In such circumstances, if in a case where the competent authority or the Arbitrator has failed to take into consideration all or any of the matters under clause (a) to (d) of sub-section (7) of Section 3G, despite the production of evidence by the claimant concerned those matters are also available for consideration in a petition filed under Section 34(1) of the Arbitration Act in respect of an acquisition made under the N H Act.

14. In all these appeals copies of the Awards of the Arbitrator were produced. They would go to show that the Arbitrator had considered compensation admissible under Sections 3G (7) (b) (c) and (d) of the N H Act. Enhancement of compensation payable under such grounds were granted by the Arbitrator. Grounds raised for further enhancement were rejected by the District Court assigning the aforesaid reason. However, we find it difficult to sustain the reasoning of the District Court. It is to be noted that going by Section 3G (7) of the N H Act the competent authority or the Arbitrator, under sub-section (1) or sub-section (2) thereof, as the case may be, is bound to consdier the matters specified under clauses (a) to (d) of Section 3G (7). In such circumstances, if evenafter production of materials and evidence they were not considered definitely, such grounds are also available to be raised in a petition filed under Section 34(1) of the Arbitration Act arising from an arbitral award in respect of acquisition of land under N H Act. Hence, the finding of the District Court that only those grounds under Section 34(2) (a) (i) to (v) and (b) (i) and (ii) are set aside. However, in this case, the Arbitrator himself considered the admissibility of compensation under clauses (a) to (d) of Section 3G (7) of the N H Act and granted the benefits. On our perusal of the materials available on records, no further interference with the orders impugned, on such grounds is called for. As a matter of fact, such grounds were not pressed into service for further enhancement.

15. In the said circumstances, the appellants are entitled to succeed in the appeals to the extent their claim for solatium and interest on solatium was dismissed by the District Court. We have also set aside the findings of the District Court that on inference in a petition filed under Section 34(2) of the Act arising from arbitral award in respect of acquisition of land under N H Act, is available only if any of grounds under Section 34(2) (a) (i) to (v) and (b) (i) and (ii) of Arbitration Act, is established. Hence, the impugned orders in OP(Arbitration) No.744/2013 dated 11.10.2017, OP(Arbitration) No.784/2013 dated 08.08.2017 and OP(Arbitration) No.758/2013 dated 26.07.2017 stand set aside to the aforesaid extent. It is declared that the appellants are entitled to get solatium and interest on solatium in terms similar to those contained in Sections 23(2) and 28 of the L A Act. Needless to say that such quantification and grant of solatium and interest in terms similar to those contained in Section 23(2) and Section 28 of the L A Act shall be effected expeditiously.

Appeals are disposed of accordingly with no orders as to costs
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