Orissa High Court
The National Highways Authority Of vs Nihar Ranjan Sahu & Ors. …. Opposite … on 20 June, 2025
Author: S.K. Panigrahi
Bench: S.K. Panigrahi
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Location: ORISSA HIGH COURT, CUTTACK
Date: 24-Jun-2025 16:53:36
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.27589 of 2024
and
W.P.(C) No.28108 of 2024
(In the matters of applications under Articles 226 and 227 of the
Constitution of India, 1950).
The National Highways Authority of .... Petitioner(s)
India
(In Both the Writ Petitions)
-versus-
Nihar Ranjan Sahu & Ors. .... Opposite Party (s)
(In Both the Writ Petitions)
Advocates appeared in the case through Hybrid Mode:
For Petitioner(s) : Mr. Umesh Chandra Mohanty, Adv.
For Opposite Party (s) : Mr. Amit Prasad Bose,Adv.
CORAM:
DR. JUSTICE S.K. PANIGRAHI
DATE OF HEARING:-19.03.2025
DATE OF JUDGMENT:-20.06.2025
Dr. 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)
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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 & Arbitrator, Keonjhar
which directed the Tahasildar-Cum-CALA, NH-6, Patna now LAO &
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 3-A of the N.H. Act 1956 to acquire the above
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Date: 24-Jun-2025 16:53:36subject 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. 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.
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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.
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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
Section 31 of the A&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:
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Date: 24-Jun-2025 16:53:36A. 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 Article 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.1 decided on 28th November, 2019, the Supreme
Court considered S.B.P. & Company v. Patel Engineering Ltd.2
and Fuerst Day Lawson Limited v. Jindal Exports Limited3 and
observed as under:
“17. This being the case, there is no doubt whatsoever
that if petitions were to be filed Under Articles 226/227
of the Constitution against orders passed in appeals
Under Section 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 Article 227 is a
constitutional provision which remains untouched by the
non-obstante Clause of Section 5 of the Act. In these(2020) 15 SCC 706
12
(2005) 8 SCC 618
3
(2011) 8 SCC 333Page 6 of 24
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petitions can be filed Under Article 227 against
judgments allowing or dismissing first appeals Under
Section 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 Bhalotia4 the
Delhi High Court, after considering all the decisions, of the Supreme
Court, Deep Industries (supra); Bhaven Construction v. Sardar
Sarovar Narmada Nigam Ltd.5; Punjab State Power Corpn.
Ltd. v. EMTA Coal Ltd.6; Virtual Perception OPC (P)
Ltd. v. Panasonic India (P) Ltd.7 and Ambience Projects &
Infrastructure (P) Ltd. v. Neeraj Bindal8 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 Articles 226/227 in
challenges to orders by an Arbitral Tribunal including
orders passed under Section 16 of the Act:
(i) An Arbitral Tribunal is a tribunal against which a
petition under Articles 226/227 would be maintainable.
4
2021 SCC OnLine Del 3708
5
(2022) 1 SCC 75
6
(2020) 17 SCC 93
7
2022 SCC OnLine Del 566
8
2021 SCC OnLine Del 4023
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(ii) The non obstante clause in Section 5 of the Act does
not apply in respect of exercise of powers under Article
227 which is a constitutional provision.
(iii) For interference under Articles 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
Articles 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 Article
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
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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. Section
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 Section 37, underscores a deliberate legislative
intent to restrict court involvement and expedite the arbitral process.
The Supreme Court in SBP & Co. v. Patel Engg. Ltd.9 emphasized the
autonomy of the arbitral process, affirming that courts must respect
the statutory scheme. While Article 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 Article 227 cannot be
curtailed by any statutory enactment like Section 5 of the Arbitration
(2005) 8 SCC 618
9
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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 Articles 226 or 227 against interlocutory or even final orders
passed under Sections 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 Article 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
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Section 37 of the Act. Acknowledging the supremacy of the
Constitution and the enduring nature of Article 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 Article 227 is
untouched by the non obstante clause in Section 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 Article 227 petitions were freely entertained
against Section 37 orders, it would negate the legislative scheme that
provides for only a single appeal and bars second appeals under
Section 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 Article 227 interference in arbitral
matters. After analyzing key Supreme Court precedents, the Delhi
High Court unequivocally held that the supervisory power under
Article 227 can only be exercised when there is demonstrable
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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 Article 227. However, the
Act’s statutory framework, particularly Sections 5 and 37, reflects a
clear legislative intent to restrict judicial intervention. Section 5‘s non
obstante clause ensures that in matters governed by the Act, no
judicial authority shall intervene unless specifically provided. Section
37, by allowing a limited and exhaustive list of appealable orders,
reinforces the notion of finality and minimal interference. The Court
warned that permitting Article 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 Article 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 Article 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
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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
Article 227, it would nullify 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 Article 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 Article 227 against orders passed under Section 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 Article 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 Section 5 and constricted
appellate structure in Section 37, demands judicial deference to
arbitral decisions. Therefore, unless there is an egregious illegality or
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an abuse of power that offends basic judicial conscience, this Court
must refrain from invoking Article 227.
VI. ISSUE B: WHETHERTHIS COURT OUGHT TO INTERFERE IN
THE FACTS OF THE PRESENT CASE?
17. Sections 3-A 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 Section 3-G(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 Section 3-A, hearing objections under Section 3-C, determining
compensation under Section 3-G(1), and ultimately disbursing
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compensation under Section 3-H. 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 Section 3-G(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. 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-impleadment of NHAI
ignore this statutory distinction and attempt to confer a status on
NHAI that the legislation deliberately withholds.
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21. The National Highways Rules, 2019 further reinforce the position that
NHAI has no legal role in arbitration under Section 3-G(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. To introduce another party into this framework would
require legislative amendment, not judicial intervention. Any
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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 Section 3-G(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 Article
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
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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.
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.
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27. Section 3-G(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 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.
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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
Section 3-G(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
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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 Section
3-G(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 Section 3-G(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
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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. It is a well-settled principle that courts exercising writ jurisdiction
under Article 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
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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 Section 3-G(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 Section 3-G(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
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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.
(Dr.S.K. Panigrahi)
Judge
Orissa High Court, Cuttack,
Dated the 20th June, 2025/
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