Case title: 

National Highway Authority of India & Ors. v. Smt. Sampata Devi & Ors.

Date of Order: 

31st October, 2023

Bench: 

Hon’ble Mr. Justice Om Prakash Shukla

Parties: 

Appellant(s): National Highway Authority of India and Ors.

Respondent(s): Smt. Sampata Devi & Ors.

SUBJECT:

The Hon’ble High Court of Allahabad (hereinafter referred to as ‘the High Court’ or ‘the Court’) dealt with the appeal lodged by the National Highway Authority of India (NHAI), contesting the legal validity of the judgment passed by the Additional District Judge, concerning the compensation granted for the development of National Highway No. 28. The compensation relates to land that NHAI acquired for this project. To streamline the process, the parties have all these appeals heard together, leading to a single, unified decision through the present common order.

IMPORTANT PROVISIONS:
The Arbitration and Conciliation Act, 1996 (ACA):

• Section 37
• Section 34

The Limitation Act, 1963 (Limitation Act):

• Section 5

The Code of Civil Procedure, 1908 (CPC)

National Highways Act, 1956 (NHA):

• Section 3(C)
• Section 3(A)
• Section (g)(5)
• Section 3H

OVERVIEW:

• NHAI needed land to construct National Highway No. 28 and issued a notice under the NHA in 2004 regarding the same in 2 daily newspapers. Objections were invited about the determination of the said compensation in the “Dainik Hindustan” and “Dainik Jagran” in 2005.
• The Special Land Acquisition Officer in Barbanki decided on the compensation based on section 3(g)(7) of the NHA.
• The NHAI deposited the full compensation amount as prescribed by the Special Land Acquisition Officer, as per section 3(H) of the NHA. And the amount was accepted by all the landowners, including the respondents, without any objections. They have been in possession of this compensation for five years without raising any concern.
• The respondent filed an arbitration application under section 3(g)(5) of the NHA in 2010, i.e., after a lapse of 5 years, claiming that the land in question has commercial value and the compensation should thus be raised. The appellant objected to the arbitration application.
• Despite NHAI’s objections, the District Magistrate issued an award in 2015.
• NHAI applied section 34 of ACA in response claiming that the arbitral award conflicted with the principles of Indian Law and was blatantly illegal.
• The Additional District Judge reviewed the arguments and upheld the Arbitrator’s findings. The Judge agreed with the assessment that the land, located near the highway should be valued as non-agricultural land rather than agricultural land.
• The appellant has now challenged the decision under section 37 of ACA.

ISSUES RAISED:

• Can an appeal be entertained when time-barred?

ARGUMENTS ADVANCED BY THE APPELLANT:

• Arbitration appeal was filed very late.
• Determination of compensation was done in accordance with law.
• The determination was done based on the nature of the land existing at the time of notification, with no irregularities.
• No limitation has been provided in section 37 of the NHA but section 34 of NHA mandates the application of section 5 of the Limitation Act.
• There were no deliberate delays in filing the appeal under section 37.

ARGUMENTS ADVANCED BY THE RESPONDENT:

• Decision of the Additional District Judge should be upheld.
• Appeal is time-barred as it was not filed within applicable limits of the law.
• Section 37 differs from section 34 of the NHA and does not incorporate section 5 of the Limitation Act.
• The delaying in filing the appeal is deliberate on the appellant’s part with no reasonable explanation given for the same.
• Appeal should be dismissed.

JUDGEMENT ANALYSIS

• Citing the case of Nusli Neville Wadia v. Ivory Properties (2020), the Court observed that the facts regarding the time limit are not in issue.
• While the legal principles are not in dispute, the judgments cited by the appellant relating to the time limit for filing an appeal under sec 37 of ACA do not directly assist the appellant in addressing this specific issue.
• The appellant has not provided any reasonable explanation for the delay in filing an appeal. Their application for an extension of the time limit is brief and fails to offer a satisfactory or legally acceptable justification, falling short of the “sufficient cause” requirement.
• Although the appellant’s counsel argued that the permission to file appeal was granted in January 2023, but were unable to file due to the nominated counsel’s illness. However, no substantiative documents or details were provided.
• The Act in question does not specify a particular time limit for filing these appeals. However, Section 43 of the Act, 1996, states that the Limitation Act will apply to arbitrations in the same way it is applied to proceedings in court. This means that the general time limitations set out in the Limitation Act are relevant for appeals in arbitration matters.
• Articles 116 and 117 in the schedule of the Limitation Act set out a 90-day limit for filing an appeal from any other Court to a High Court and a 30-day time limit for an intra-court appeal, about cases where a Single Bench’s order is being appealed to a Division Bench, provided such an appeal is allowed by the law before the Division Bench.
• Articles 116 and 117 of the Schedule of the Limitation Act apply to appeals of this nature.
• Section 5 of the Limitation Act allows for an extension of the prescribed time limit, provided the court is satisfied that there was “sufficient cause” for the delay.
•  It is to be noted that the Commercial Courts Act, 2015 has introduced changes to the time limits for filing appeals under section 37 of ACA. As a result, all arbitration matters are under the jurisdiction of a commercial court, provided that the commercial dispute in question exceeds the specified value.
• The proviso to section 13(1A) states that an appeal under section 37 of the ACA be filed before the Commercial Court, and this appeal must be filed within 60 days.
• The proviso to Section 13(1A) states that an appeal under Section 37 of the Arbitration & Conciliation Act should be filed before the Commercial Court, and this appeal must be filed within 60 days.
• In the case of Union of India v. Virendera Constructions Ltd (2020), the Supreme Court established a limitation period of 120 days from the date of the order and stated that no further delay beyond 120 days can be allowed. The Supreme Court reasoned that since a Section 34 application must be filed within a maximum period of 120 days, including a grace period of 30 days, an appeal filed from the same should follow the same rule.

CONCLUSION

In the present case, the High Court observed that the NHAI filed an appeal under section 37 of NHA, however, this appeal was filed well beyond the allowable 60-day time frame and lacks valid “sufficient cause” to justify the delay and therefore the appeals were rejected for condonation of delay in filing. Resultantly, the Court dismissed on the grounds of limitation with no order as to costs.