Mr. Stany D Souza Alias Stanislaus D Souza v. National Highway Authority of India

NC:(2026:KHC:7113-DB( MFA(No.(7016(of(2024( ( , ,,HC-KAR( ( (

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

THDATED THIS THE 6 DAY OF FEBRUARY, 2026

PRESENT THE HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE AND THE HON'BLE MR. JUSTICE C.M. POONACHA MISCELLANEOUS FIRST APPEAL NO. 7016 OF 2024 (AA)

BETWEEN:

MR. STANY D SOUZA ALIAS STANISLAUS D SOUZA AGED ABOUT 65 YEARS

S/O LATE ANTHONY D SOUZA R/O KALLADKA POST KALLADKA GOLTHAMAJALU VILLAGE

BANTWAL TALUK DAKSHINA KANNADA DISTRICT 574222

Digitally PROPRIETOR OF STANS signedtiby NIRMALA SHOPPING CENRE, SOUZA COMPLEX, DEVI KALLADKA,

Location: GOLTHAMAJAL VILLAGE, HIGH0COURT BANTWAL TALUK, OF D.K.DISTRICT. KARNATAKA

…APPELLANT (BY SRI. CYRIL PRASAD PAIS.,ADVOCATE)

AND:

¶1NATIONAL HIGHWAY AUTHORITY OF INDIA PIU MANGALORE DOOR NO. 3-29 NC:(2026:KHC:7113-DB( MFA(No.(7016(of(2024( ( , ,,HC-KAR( ( ( BETHEL THARETHOTA NEAR PUMPWELL (NH-66) MANGALORE 575005 REPRESENTED BUY ITS DGM (TECH ) AND PROJECT DIRECTOR

¶2THE COMPETENT AUTHORITY AND SPECIAL LAND ACQUISITION OFFICER (N.H.A.I), N.H 75 HASSAN -B .C ROAD SECTION NO. HIG-64, DTDC COURIER OFFICE BUILDING 1ST FLOOR, KHB COLONY CHANNAPATTANA OPP KSRTC NEW BUS STAND HASSAN 573201

¶3THE DEPUTY COMMISSIONER AND ARBITRATOR DAKSHINA KANNADA DISTRICT MANGALURU 575008

…RESPONDENTS

THIS MFA IS FILED UNDER SECTION 37(1)(c) OF THE ARBITRATION AND CONCILIATION ACT, AGAINST THE ORDER DATED 30.05.2024 PASSED IN AP.NO.158/2023 ON THE FILE OF THE I ADDITIONAL DISTRICT JUDGE, D.K.MANGALURU, DECREEING THE ARBITRATION PETITION FILED U/S 34 OF THE OF THE ARBITRATION AND CONCILIATION ACT R/W ORDER 7 RULE 1 OF CPC.

THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE and HON'BLE MR. JUSTICE C.M. POONACHA

ORAL JUDGMENT (PER: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE)

¶1The appellant has filed the present appeal under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 [hereafter A&C Act] impugning an order dated 30.05.2024 [impugned order] passed by the learned I Additional District Judge, D.K, Mangaluru, [the District Court] in A.P.No.151/2023 & A.P.No.158/2023. The said appeals had been preferred by the parties challenging the arbitral award dated 11.01.2023 rendered by respondent No.3 (Arbitral Tribunal) pursuant to an application filed by the appellant under Section 3G(5) of the National Highways Act, 1956 [NH Act]. The appellant filed the said application being aggrieved of the compensation of ₹3,925 per cent as determined by the Arbitral Tribunal in respect of 162 sq.mtrs. of land falling in Survey No.32/2 of Golthamajalu Village, Bantwal Taluk, which was acquired for widening of the national highway under the provisions within NH Act. The Arbitral Tribunal had enhanced the compensation from ₹3,925 per cent to ₹4,881 per cent. Challenging the said award before the learned District Court; the appellant had filed A.P.No.151/2023 and respondent No.1 had filed A.P.No.158/2023.

¶2The learned District Court dismissed the petition filed by respondent No.1, i.e., A.P.No.151/2023. However, had allowed the petition filed by the appellant and had set aside the award. Although the appellant had succeeded in seeking setting aside of the impugned award, the appellant has preferred the present appeal solely on the ground that the learned District Court had simply set aside the impugned award, but had not remanded the matter to the Arbitral Tribunal for consideration afresh.

¶3An application under Section 34 of A&C Act is to determine whether the arbitral award is required to be set aside on the limited grounds as set out therein. The Court while exercising powers under Section 34 of the A&C Act does not have any power to remand the matter to the Arbitral Tribunal.

¶4The learned counsel appearing for the appellant contends that the Arbitral Tribunal has a power to remand the matter to the Arbitral Tribunal under Section 34(4) of the A&C Act. He contends that in the present case, the learned District Court was required to take recourse to the said provision.

¶5Section 34(4) of A&C Act is set out below:

34 . Application for setting aside arbitral award. **** 4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside the arbitral award.

¶6A plain reading of Section 34(4) of the A&C Act indicates that the scope of the said provision is of a limited remand. The Court can, in certain circumstances, adjourn the proceedings to enable the Arbitral Tribunal to resume the arbitral proceedings to eliminate the grounds for setting aside the award.

¶7It is clear from the plain language of the said provision that in certain circumstances, the Court may adjourn the proceedings to enable the Arbitral Tribunal to resume the arbitral proceedings and to take such other action as in the opinion of the Arbitral Tribunal will eliminate the grounds for setting aside the arbitral award.

¶8In the present case, the learned District Court had found it apposite to set aside the award. However, has granted liberty to the parties to avail the remedy in accordance with law to re-initiate

the arbitration proceedings afresh. Paragraph 40 of the impugned order which clearly sets out the said decision is reproduced below;

¶40In view of the above discussion the impugned award is set aside. The parties would be at liberty to avail remedy in accordance with law for initiation of fresh arbitration.

¶9In view of the above, we find no merit in the appeal, accordingly, it is dismissed.

¶10Pending IAs., if any, stand disposed of.

Sd/- (VIBHU BAKHRU) CHIEF JUSTICE

Sd/- (C.M. POONACHA) JUDGE

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