Case Note & Summary
This Miscellaneous First Appeal was filed under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 before the High Court of Karnataka, challenging the order dated 13.02.2026 passed by the Principal District and Sessions Judge, Bengaluru Rural District, in A.P.No.42/2024. The underlying dispute concerned compensation for land measuring 1398 sq. mtrs. in Survey Nos.42/2 and 179/1 of Kumbalagodu Village, Kengeri Hobli, Bengaluru South Taluk, acquired for upgradation/widening of NH-275 under the National Highways Act, 1956. The land belonged to respondent No.2, C. Pramod. The Special Land Acquisition Officer passed an award on 05.01.2017 determining compensation at Rs 4,07,92,483 based on land value of Rs 8,646 per sq m for agricultural land. Dissatisfied, the landowner approached the Arbitral Tribunal under Section 3G(5) of the NH Act. The Tribunal's first award dated 08.07.2021 was set aside by the District Court on 22.11.2022 in A.P.No.10/2022 and remanded. On fresh consideration, the Tribunal passed a second award on 01.12.2023, applying the Guideline Value Notification dated 28.03.2016 which indicated Rs 19,380 per sq m for Kumbalagodu Industrial Area. The appellants, after receiving the award on 08.12.2023, filed an application under Section 33 of the A&C Act on 09.05.2024, contending that the award erroneously treated the land as fully developed, and sought correction. The Tribunal rejected this application on 13.06.2024 both on merits and on limitation. The appellants then filed a Section 34 petition, which the District Court dismissed, holding no patent illegality or violation of public policy. Before the High Court, the appellants argued that the Arbitral Tribunal erred in rejecting the Section 33 application on limitation without considering their condonation of delay application under Section 5 of the Limitation Act. They contended that statutory arbitration under the NH Act was not governed by Section 43 of the A&C Act, and because no express exclusion existed, Sections 4 to 24 of the Limitation Act applied under Section 29(2). They cited decisions such as Union of India v. Popular Construction Co., Government of Maharashtra v. Borse Brothers, North Delhi Municipal Corporation v. S.A. Builders Limited, and Deputy Commissioner v. S.V.Global Mill Limited to argue that limitation periods were not sacrosanct and delay could be condoned. The respondent argued that delay in filing a Section 33 application cannot be condoned, relying on Tantia Construction Ltd. v. Ircon International Ltd. and other decisions, and warned that permitting condonation would allow tactical extensions of the Section 34 limitation period. The High Court commenced its reasons by noting that the question of Section 5 applicability to Section 33 was not dispositive in the given facts. The extracted judgment concludes at that observation, without a final operative direction. Consequently, the final decision on the appeal is not available in the provided text.
Headnote
A) Arbitration - Application under Section 33 of Arbitration and Conciliation Act, 1996 - Condonation of Delay and Limitation Act Applicability - Arbitration and Conciliation Act, 1996, Sections 33, 43, 2(4); Limitation Act, 1963, Sections 5, 29(2), 4 to 24; National Highways Act, 1956, Section 3G(5) - The appellants filed an application under Section 33 beyond the 30-day period with a condonation of delay request under Section 5 of the Limitation Act, which the Arbitral Tribunal dismissed as time-barred. The appellants contended that in statutory arbitration under the NH Act, Part I of the A&C Act and Section 43 were excluded due to inconsistency, and Sections 4 to 24 of the Limitation Act applied by virtue of Section 29(2). The High Court noted that the issue of Section 5 applicability was not dispositive in the given facts. (Paras 10-15, 17) B) Arbitration - Challenge to Arbitral Award under Section 34 - Patent Illegality and Public Policy - Arbitration and Conciliation Act, 1996, Section 34(2)(b)(ii) - The appellants contended that the arbitral award was patently illegal because it adopted the Guideline Value Notification dated 28.03.2016, issued after the preliminary notification dated 02.02.2016, and because the subject land was not fully developed. The District Court held that the award was not vitiated by patent illegality and was not opposed to public policy, as the matter had already been remanded and compensation was based on documents on record. (Paras 8-9) C) Land Acquisition - Compensation Determination under National Highways Act, 1956 - Market Value and Guideline Value Notification - National Highways Act, 1956, Sections 3G(5), 3-A(1), 3-D(1) - The SLAO initially determined compensation at Rs 4,07,92,483 for the subject land based on agricultural land value of Rs 8,646 per sq m. The Arbitral Tribunal, after remand, determined compensation using the Guideline Value Notification dated 28.03.2016, which specified Rs 19,380 per sq m for Kumbalagodu Industrial Area. The Tribunal noted that the land was converted for industrial use prior to the preliminary notification. (Paras 3-5) D) Arbitration - Remand and Fresh Consideration - Effect of Setting Aside Prior Award - Arbitration and Conciliation Act, 1996, Section 34 - The first arbitral award dated 08.07.2021 was set aside by the District Court in A.P.No.10/2022 by order dated 22.11.2022, and the matter was remanded for fresh consideration. The District Court in the subsequent Section 34 petition held that the matter could not be re-referred. (Paras 4, 9) E) Arbitration - Statutory Arbitration under National Highways Act, 1956 - Applicability of Part I of A&C Act and Limitation Act - Arbitration and Conciliation Act, 1996, Sections 2(4), 43; Limitation Act, 1963, Section 29(2) - The appellants argued that Part I of the A&C Act was inapplicable to inconsistencies with the NH Act and that Section 43 did not apply, permitting Limitation Act provisions including Sections 4 to 24. This was contested by the respondent, who argued that condonation would permit tactical extensions of the Section 34 limitation period. (Paras 11, 16)
Issue of Consideration
Whether Section 5 of the Limitation Act, 1963 is applicable to condone delay in filing an application under Section 33 of the Arbitration and Conciliation Act, 1996 in a statutory arbitration under the National Highways Act, 1956; and whether the arbitral award dated 01.12.2023 is vitiated by patent illegality for adopting a Guideline Value Notification dated 28.03.2016 issued after the preliminary notification under Section 3-A(1) of the NH Act.
Final Decision
Not mentioned in the extracted text; judgment text ends before the final operative order.
Law Points
- Section 5 of Limitation Act may apply to Section 33 A&C Act in statutory arbitration under NH Act via Section 29(2) if no express exclusion
- Section 34(3) proviso expressly excludes Section 5
- Section 37 delay can be condoned under Limitation Act
- Section 33 application cannot be used as tactical device to extend Section 34 limitation
- guideline value notification issued after preliminary notification may be considered but its adoption must not be patently illegal
- district court cannot re-refer matter after remand
- statutory arbitration under NH Act functions as reference court
