NATIONAL HIGHWAYS AUTHORITY OF INDIA versus SHEETAL JAIDEV VADE & ORS. on 24 August 2022

1. Feeling aggrieved and dissatisfied with the impugned judgmentand order dated 01.04.2022 passed by the High Court of Judicature ofBombay at Aurangabad in Writ Petition No.144 of 2021 by which in awrit petition filed by the respondents herein – original land owners, inexercise of powers under Article 226 of the Constitution of India, theHigh Court has directed the appellant – NHAI to deposit the entirecompensation amount as awarded by the learned Arbitrator andthereafter permitting the original land owners – original writ petitionersto withdraw the amount as mentioned in paragraph 4, the NHAI haspreferred the present appeal.

2. That the land of the respondents herein – original land owners– original writ petitioners came to be acquired by the NHAI under theprovisions of the NHAI Act. That the amount of compensation came tobe enhanced by the learned Arbitrator. The award passed by the learnedArbitrator has been challenged by the NHAI by availing the statutoryremedy under Section 34 of the Arbitration Act to the extent of theenhanced amount. That as there was no stay of the award passed bythe learned Arbitrator in a proceedings under Section 34 of the ArbitrationAct, the respondent herein – original land owners instead of filing theexecution petition to execute the award declared by the learned Arbitratorenhancing the amount of compensation, filed the writ petition before theHigh Court and prayed for a Writ of Mandamus and/or appropriatedirections/orders directing the NHAI to deposit the amount with the A

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ACompetent Authority, Land Acquisition and Sub-Divisional Officer inpursuance of the award dated 12.06.2018. By the impugned judgmentand order the High Court has disposed of the said writ petition by directingthe appellant – NHAI to deposit the entire amount along with interestwith the Land Acquisition Authority and thereafter has directed the originalwrit petitioners – land owners to withdraw 50% of the amount alongBwith interest on filing an affidavit of undertaking that if in the litigationjourney, an adverse order is passed against them and they are found tohave withdrawn excess amount, the said amount would be re-depositedwith the authority. So far as the remaining 50% of the amount withinterest is concerned, the High Court has permitted the original writCpetitioners – original land owners to withdraw 25% of the amount bytendering a solvent surety and the remaining 25% of the amount to bedeposited with the competent authority with a liberty to invest the saidamount in a fixed deposit account in any Nationalized Bank. Feelingaggrieved and dissatisfied with the impugned order passed by the HighCourt, the NHAI has preferred the present appeal.D3. Ms. Aishwarya Bhati, learned ASG appearing on behalf of theappellant – NHAI has vehemently submitted that the Hon’ble High Courthas seriously erred in passing the impugned order in exercise of powersunder Article 226 of the Constitution of India.

E3.1 It is further submitted by Ms. Bhati, learned ASG that as theaward passed by the learned Arbitrator was executable before theconcerned Executing Court and therefore when the original writpetitioners had a statutory remedy available to execute the award byinitiating the execution proceedings before the concerned ExecutingCourt, the High Court ought not to have entertained the writ petitionsFunder Article 226 of the Constitution of India to execute the award passedby the learned Arbitrator.

3.2 It is further submitted by Ms. Bhati, learned ASG that evenotherwise the Hon’ble High Court has committed a serious error inpermitting the writ petitioners – original land owners to withdraw 75%Gof the amount of compensation with interest, when the appellant hadalready availed the statutory remedy available to the NHAI to challengethe award passed by the learned Arbitrator, by way of appeal/applicationunder Section 34 of the Arbitration Act.

3.3 Ms. Bhati, learned ASG has placed reliance on the order passedHby this Court in Special Leave to Appeal No.12409 of 2022 passed in the case of The Project Director, National Highways Authorityof India vs. Saraswatibai Chandrakant Shinde & Ors. by which, onthe similar set of facts and circumstances this Court has directed theNHAI to deposit 50% of the compensation amount, as awarded by theArbitral Tribunal with the Executing Court and has permitted the originalland owners to withdraw the same unconditionally, and the balanceamount of compensation as per the award to be passed under Section34 of the Arbitration Act to be deposited by the NHAI with the ExecutingCourt within four weeks after such determination.

4. Present appeal is vehemently opposed by Mr. Shirish K.Deshpande, learned Advocate appearing on behalf of the privaterespondents herein – original writ petitioners – original land owners.

4.1 It is submitted that in the facts and circumstances of the casemore particularly considering the fact that there is no stay of the awardpassed by the learned Arbitral Tribunal/Court in a proceeding underSection 34 of the Arbitration Act and that NHAI took possession of theland without paying any compensation, the Hon’ble High Court has notcommitted any error in passing the impugned order. However, learnedCounsel appearing on behalf of the private respondents herein – originalland owners – original writ petitioners, is not in a position to dispute andis not disputing that the award passed by the learned Arbitral Tribunal/Court is executable by way of an execution proceeding before theconcerned Executing Court.

5. We have heard the learned counsel for the respective partiesat length.

6. At the outset, it is required to be noted that the privaterespondents herein – original writ petitioners filed the writ petition beforethe High Court and prayed for the following reliefs in exercise of powersunder Article 226 of the Constitution of India:

“(a)This Writ Petition may kindly be allowed.

(b) That, by way of writ of mandamus of the direction like innature the respondents No.1 and 2 may kindly be directedto deposit the amount with respondent No.3 in pursuanceof the award dated 12.06.2018 vide No.2016/LA/NH-351/CR-01 passed by the respondent No.3 forthwith.

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A(c)That, by way of writ of mandamus of the directions like innature the respondent No.3 may kindly be directed to makethe payment to petitioners forthwith after the respondentsNo.1 and 2 deposit the amount.”

6.1 Therefore, reliefs which have been sought by the privateBrespondents herein - original writ petitioners were in the nature ofexecution of the award passed by the learned Arbitral Tribunal/Court.

6.2 Apart from the fact that the award dated 12.06.2018 has beenchallenged by the NHAI by initiating proceedings under Section 34 ofthe Arbitration Act which are reported to be pending, the High CourtCought not to have entertained the writ petition under Article 226 of theConstitution of India seeking the reliefs to execute the award passed bythe learned Arbitral Tribunal/Court, when the award passed by the learnedArbitral Tribunal/Court is to be executed by initiating an executionproceeding before the concerned Executing Court. But, by passing theimpugned order/directions the High Court has virtually converted itselfDinto Executing Court. Therefore, once the original writ petitioner washaving an efficacious, alternative remedy to execute the award passedby the learned Arbitral Tribunal/Court, by initiating an appropriateexecution proceeding before the competent Executing Court, the HighCourt ought to have relegated the original writ petitioners to avail theEsaid remedy instead of entertaining the writ petition under Article 226 ofthe Constitution of India which was filed to execute the award passedby the Arbitral Tribunal/Court. If the High Courts convert itself to theExecuting Court and entertain the writ petitions under Article 226 of theConstitution of India to execute the award passed by the Arbitral Tribunal/Court, the High Courts would be flooded with the writ petitions to executeFawards passed by the learned Arbitrator/Arbitral Tribunal/Arbitral Court.

7. We disapprove the entertaining of such writ petitions underArticle 226 of the Constitution of India to execute the award passed bythe learned Arbitral Tribunal/Court, without relegating the judgmentcreditor in whose favour the award is passed to file an executionGproceeding before the competent Executing Court.

7.1 In view of the above discussion, we would have set aside theimpugned judgment and order passed by the High Court on the aforesaidground alone. However, taking into consideration the similar order passedby this Court in the case of Saraswatibai Chandrakant Shinde (supra),H

NATIONAL HIGHWAYS AUTHORITY OF INDIA v. SHEETALJAIDEV VADE & ORS. [M. R. SHAH, J.]

we deem it appropriate to dispose of the present proceedings/appealwith the following directions:

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(i) The NHAI shall deposit 50 per cent of the compensationamount, as awarded by the Arbitral Court, with the ExecutingCourt within a period of four weeks. The said amount shallbe released to the land owners unconditionally.

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(ii) The learned District Court, before whom the proceedingsunder Section-34 of the Arbitration Act are pending, shall makean endeavour to decide such proceedings within a period ofsix months from the next date of hearing before the said court.

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(iii) The balance amount of compensation as per the Award to bepassed under Section 34 of the Arbitration Act, shall bedeposited by the NHAI with the Executing Court within fourweeks after such determination. The said amount shall alsobe released by the Executing Court in favour of the landowners subject to the rights and remedies available to theDparties in law.

With these observations and directions, the Appeal is disposed of.

The impugned order passed by the High Court of Bombay dated01.04.2022 stands modified in above terms.

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Pending application(s), if any, shall stand disposed of.

Divya Pandey

Appeal disposed of.

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