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2023 DIGILAW 2538 (PNJ)

National Highways Authority of India v. Ashok Kumar Garg

2023-08-22

GURVINDER SINGH GILL

body2023
JUDGMENT Mr. Gurvinder Singh Gill, J. The petitioner - National Highways Authority of India (NHAI) assails order dated 17.01.2023 (Annexure P-6) vide which the learned Additional District Judge, Patiala, while allowing an application filed by the petitioner under section 36(2) of the Arbitration and Conciliation Act, 1996 (for short 'the Act') seeking stay of operation of the award dated 27.09.2019, imposed a condition to deposit the entire enhanced awarded amount alongwith requisite interest, within 4 months, in terms of the award dated 27.09.2019 of Arbitrator, before the CALA and directed that 50% of amount shall be released to the land-owner subject to his furnishing indemnity bonds of double of the amount with one surety of the like amount and balance of the 50% amount be kept in the shape of FDR and not to be released till final disposal of the petition under Section 34 of the Act. 2. A few facts, necessary to notice for disposal of the instant revision petition, are that the land belonging to respondent No.l as well as other land-owners was acquired under the provisions of National Highway Act, 1956. The Competent Authority -cum- SDM, Ludhiana assessed the compensation for the acquired land at the rate of Rs.213.52 per square meter apart from other statutory benefits. Thereafter, the matter was referred to the Arbitrator, who enhanced the compensation to Rs.8373/- per square meter vide award dated 27.09.2019 (Annexure P-1). 3. The petitioner filed a petition under Section 34 of the Act in the Court of District Judge, Patiala assailing the award dated 27.09.2019 (Annexure P-l) passed by the Arbitrator. Along with the said petition, the petitioner also moved an application under Section 36(2) of the Act seeking stay of the operation of the award. The Court of Additional District Judge, Patiala considered the said application and disposed of the same by passing a detailed order dated 17.01.2023 (Annexure P-6), the operative portion of which is reproduced hereinunder: "16. However, applying the yardsticks of the above referred authorities and in the interest of justice, the present application filed under section 36 (2) of the Arbitration and Conciliation Act is allowed and operation of the award dated 27.9.2019 is stayed till the disposal of the objection petition under Section 34 of the Act. However, applying the yardsticks of the above referred authorities and in the interest of justice, the present application filed under section 36 (2) of the Arbitration and Conciliation Act is allowed and operation of the award dated 27.9.2019 is stayed till the disposal of the objection petition under Section 34 of the Act. However, same is subject to the deposit of entire enhanced awarded amount alongwith requisite interest, within four months, in terms of the award dated 27.9.2021 of Arbitrator, before the CALA and 50% of amount shall be released to the land owner subject to his furnishing indemnity bonds of double of the amount with one surety of the like amount, as per award dated 27.9.2021 and balance of the 50% amount be kept in the shape of FDR and not to be released till final disposal of the petition under Section 34 of the Act. The application is accordingly allowed in the aforestated terms." 4. According to learned counsel for the petitioner, operation of the Award dated 27.09.2019 sought to be stayed, inter alia, on the ground that the compensation has been enhanced arbitrarily and also on the ground that the Presiding Officer has been passing inconsistent orders in cases of identical nature. It has been submitted that vide order dated 27.07.2022 (Annexure P-7) passed in Arb. No.710 of 2019 titled 'Union of India v. Vijay Kumar' and order dated 21.09.2022 (Annexure P-8) passed in Arb. No.7 of 2022 titled 'Union of India v. Darbara Singh', the same very Presiding Officer had stayed the operation of the impugned Award while directing the entire compensation be kept invested in the shape of FDR and be not released till the final disposal of the petition under Section 34 of the Act. 5. This Court has heard the learned counsel for the petitioner and perused the paper book, impugned order dated 17.01.2023 (Annexure P-6) as well as orders dated 27.07.2022 (Annexure P-7) and 21.09.2022 (Annexure P-8). 6. Before proceeding further, it is apposite to refer to the provisions of Section 36 of the Act, which are reproduced hereinunder: "36. 5. This Court has heard the learned counsel for the petitioner and perused the paper book, impugned order dated 17.01.2023 (Annexure P-6) as well as orders dated 27.07.2022 (Annexure P-7) and 21.09.2022 (Annexure P-8). 6. Before proceeding further, it is apposite to refer to the provisions of Section 36 of the Act, which are reproduced hereinunder: "36. Enforcement - (1) Where the time for making an application to set aside the arbitral award under section 34 has expired, then, subject to the provisions of sub-section (2), such award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908 (5 of 1908), in the same manner as if it were a decree of the court. (2) Where an application to set aside the arbitral award has been filed in the Court under section 34, the filing of such an application shall not by itself render that award unenforceable, unless the Court grants an order of stay of the operation of the said arbitral award in accordance with the provisions of sub-section (3), on a separate application made for that purpose. (3) Upon filing of an application under sub-section (2) for stay of the operation of the arbitral award, the Court may, subject to such conditions as it may deem fit, grant stay of the operation of such award for reasons to be recorded in writing: Provided that the Court shall, while considering the application for grant of stay in the case of an arbitral award for payment of money, have due regard to the provisions for grant of stay of an money decree under the provisions of the Code of Civil Procedure, 1908 (5 of 1908). Provided further that where the Court is satisfied that a prima facie case is made out that- (a) the arbitration agreement or contract which is the basis of the award; or (b) the making of the award, was induced or effected by fraud or corruption, it shall stay the award unconditionally pending disposal of the challenge under section 34 to the award. Explanation - For the removal of doubts, it is hereby clarified that the above proviso shall apply to all court cases arising out of or in relation to arbitral proceedings, irrespective of whether the arbitral or court proceedings were commenced prior to or after the commencement of the Arbitration and Conciliation (Amendment) Act, 2015." 7. Explanation - For the removal of doubts, it is hereby clarified that the above proviso shall apply to all court cases arising out of or in relation to arbitral proceedings, irrespective of whether the arbitral or court proceedings were commenced prior to or after the commencement of the Arbitration and Conciliation (Amendment) Act, 2015." 7. A perusal of the aforesaid provisions particularly Section 36(3) would indicate that while considering grant of stay of an arbitral award pertaining to payment of money, the Court is to have due regard to the provisions for grant of stay of a money decree under the provisions of the Code of Civil Procedure, 1908. It is, thus, apparent that the Court is expected to bear in mind that a money decree is ordinarily not to be stayed in routine and that mere instituting a petition under Section 34 of the Act will not operate as an automatic stay, as it used to be under the pre amended provisions i.e. prior to the amendments brought out in Section 36 by the Arbitration and Conciliation (Amendment) Act, 2015. 8. As far as the ground taken regarding the Presiding Officer passing inconsistent orders in identical cases is concerned, a perusal of orders dated 27.07.2022 (Annexure P-7) and 21.09.2022 (Annexure P-8) does show that the Presiding Officer in those cases had taken a different view in identical situation and had virtually stayed the operation of the Award, while directing the NHAI to deposit the awarded amount in FDR, which was not to be encashed until the conclusion of the proceedings under Section 34 of the Act. 9. However, the impugned order was passed much later in the next year i.e. in the year 2023 and wherein while passing the orders, the Presiding Officer has taken note of some judgments delivered by Hon'ble the Supreme Court i.e. judgment rendered in National Highways Authority of India v. Sheetal Jaidev Vade. Civil Appeal No.5256-2022 decided on 24.08.2022 and another judgment rendered in The Project Director. National Highways Authority of India v. Saraswatibai Chandrakant Shinde, Appeal (C) No.12409 of 2022 decided on 01.08.2022. Hon'ble the Supreme Court in Sheetal Jaidev Vade's case (supra) had issued the following directions: "(i) NHAI shall deposit 50 percent of compensation amount, as awarded by Arbitral Court, with Executing Court within period of four weeks. Paid amount shall be released to land owners unconditionally. Hon'ble the Supreme Court in Sheetal Jaidev Vade's case (supra) had issued the following directions: "(i) NHAI shall deposit 50 percent of compensation amount, as awarded by Arbitral Court, with Executing Court within period of four weeks. Paid amount shall be released to land owners unconditionally. (ii) District Court, before whom proceedings under section 34 of Arbitration Act are pending, shall make endeavour to decide such proceedings within period of six months from next date of hearing before Court. (iii) Balance amount of compensation as per Award to be passed under section 34 of Arbitration Act, shall be deposited by NHAI with Executing Court within four weeks after such determination. Amount shall also be released by Executing Court in favour of land owners subject to rights and remedies available to parties in law." 10. A perusal of the aforesaid extract from the judgment dated 24.08.2022 would show that Hon'ble the Supreme Court had ordered release of 50% of the compensation unconditionally while directing District Court to decide proceedings under Section 34 of the Act expeditiously preferably within 6 months. The balance 50% amount of the compensation was ordered to be deposited with the Executing Court within 4 weeks after such determination. 11. One of the orders in respect of other identical cases i.e. order dated 27.07.2022 (Annexure P-7) was passed by the Court below before the judgment delivered by Hon'ble the Supreme Court, whereas order dated 21.09.2022 (Annexure P-8) was passed little later. In the impugned order, which was passed much later, the Presiding Officer has duly taken note of subsequent development of law particularly judgment dated 24.08.2022 and has accordingly passed an order following the view of Hon'ble the Supreme Court. The impugned order cannot be said to be inconsistent with the view of the Hon'ble Supreme Court. Rather, the Presiding Officer by changing her view in the matter of stay shows that the Presiding Officer keeps herself updated with the latest development of law. This Court does not find any infirmity or illegality in the impugned order dated 17.01.2023 (Annexure P-6) and the same is hereby upheld. 12. The instant petition is sans merit and is hereby dismissed.