V. M. Mathew v. National Highway Authority of India & Ors. Arb. A. No. 60 of 2018

Scope of Challenge Under Sec. 34 of The Arbitration & Conciliation Act

In an order dated 25 January 2021 (V. M. Mathew v. National Highway Authority of India & Ors), the Kerala High Court concurred with the District Court on the limited grounds available to set aside an arbitral award.

Background

Aggrieved by the compensation amounting to INR 7,19,040 provided by the Special Land Acquisition Officer for the acquisition of a plot of land owned by the Appellant for the development of National Highway 47, the Appellant filed an arbitration petition under Section 3(c)(5) of the National Highways Act to seek enhancement of the compensation. The District Collector being the Arbitrator, rendered an award enhancing the compensation and fixed it at INR 12,56,640. Dissatisfied by the amount awarded, the Appellant sought to set aside the award under Section 34 of the Arbitration and Conciliation Act 1996 before the District Court. Since the district Court refused to set aside the award, the Appellant preferred an appeal under Section 37(1)(b) of the Arbitration and Conciliation Act before the High Court of Kerala.

Decision

The Division Bench declined to reverse the decision of the District Court and concurred with the following finding of the District Court:

“An Award of the Arbitrator could be challenged only on the grounds enumerated in Section 34 of the Act

and it could not be set aside merely on the ground that compensation awarded was insufficient.”

However, having observed that in the arbitral award no amount was paid towards solatium or interest thereon, the Bench partially allowed the appeal and held that the appellant is entitled to solatium and interest on solatium as provided under Section 23(1A) and (2) of the Land Acquisition Act 1894.

Comment

This judgement continues to reinforce the principle of minimum curial intervention in arbitral awards limiting judicial review to specific grounds identified and established in a long line of judgements rendered previously.