NATIONAL HIGHWAY AUTHORITY OF INDIA, vs SMT. KUSUMA G. SUVARNA ALIAS KUSUMA,

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 6TH DAY OF NOVEMBER, 2026


PRESENT

THE HON'BLE MRS. JUSTICE ANU SIVARAMAN

AND

THE HON'BLE MR. JUSTICE T.P.VIVEKANANDA

MISCELLANEOUS FIRST APPEAL NO. 5039 OF 2025
C/W
MISCELLANEOUS FIRST APPEAL NO. 7070 OF 2025 (AA)


IN MFA No. 5039/2025




BETWEEN:

NATIONAL HIGHWAY AUTHORITY OF INDIA
PIU-MANGALORE, DOOR NO.3-29
BETHEL, THARETHOTA
NEAR PUMPWELL (NH-66)
MANGALORE-575 005
REPRESENTED BY ITS
PROJECT DIRECTOR
…APPELLANT








(BY SRI: SHOBHITH N SHETTY, ADVOCATE)
Digitally signed by
PREMCHANDRA M R
Location: HIGH
COURT OF
KARNATAKA
AND:

1. SMT. KUSUMA G SUVARNA
ALIAS KUSUMA
W/O LATE GOVINDA SUVARNA
RESIDING AT SUVARANA MANDIR
NEAR SRINIVAS HOSPITAL
MUKKA, SURTHKAL
MANGALORE

2.
SMT. PRAMEELA
D/O LATE GOVINDA SUVARNA
RESIDING AT SUVARNA MANDIR

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NEAR SRINIVAS HOSPITAL
MUKKA, SURTHKAL
MANGALORE

3. SMT. POORNIMA
D/O LATE GOVINDA SUVARNA
RESIDING AT SUVARNA MANDIR
NEAR SRINIVAS HOSPITAL
MUKKA, SURTHKAL
MANGALORE

4. SRI. GIRISH SUVARNA
S/O LATE GOVINDA SUVARNA
RESIDING AT SUVARNA MANDIR
NEAR SRINIVAS HOSPITAL
MUKKA, SURTHKAL
MANGALORE

5.
THE COMPETENT AUTHORITY AND
SPECIAL LAND ACQUISITION OFFICER
NATIONAL HIGHWAY-66
NGO BUILDING, NEAR CLOCK TOWER
MANGALURU, D.K. DISTRICT-575 001

6. THE DEPUTY COMMISSIONER
AND ARBITRATOR
DAKSHINA KANNADA DISTRICT
MANGALURU-575 008
…RESPONDENTS
(BY SRI: SACHIN B S, ADVOCATE FOR R1 TO R4;
SRI: BYREGOWDA N, AGA FOR R5 & R6)

THIS MFA IS FILED UNDER SECTION 37(1)(C) OF THE
ARBITRATION AND CONCILIATION ACT, AGAINST THE ORDER
DATED 01.04.2025 PASSED IN A.P.NO.123/2023 ON THE
FILE OF THE IV ADDITIONAL DISTRICT AND SESSIONS JUDGE,
COMMERCIAL COURT, DAKSHINA KANNADA, MANGALURU,
DISMISSING THE PETITION FILED UNDER SECTION 34 OF

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ARBITRATION AND CONCILIATION ACT READ WITH SECTION
3G(6) OF THE NATIONAL HIGHWAYS ACT, 1956.


IN MFA NO. 7070/2025
BETWEEN:
1. MRS. KUSUMA G SUVARNA
@ KUSUMA
W/O LATE GOVINDA SUVARNA
AGED ABOUT 74 YEARS

2. MRS. PRAMILA
D/O LATE GOVINDA SUVARNA
AGED ABOUT 52 YEARS

3. MRS. POORNIMA
D/O LATE GOVINDA SUVARNA
AGED ABOUT 48 YEARS

4. SMR. GIRISH SUVARNA
S/O LATE GOVINDA SUVARNA
AGED ABOUT 45 YEARS

APPELLANT NOS.1 TO 4 ARE
RESIDING AT SUVARNA MANDIR
NEAR SRINIVAS HOSPITAL
MUKKA, SURTHKAL
MANGALORE-575 021
... APPELLANTS
(BY SRI: SACHIN B S, ADVOCATE)
AND:
1. THE SPECIAL LAND ACQUISITION OFFICER
OFFICER AND COMPETENT AUTHORITY
NATIONAL HIGHWAYS
KUNDAPUR-SURATHKAL SECTION
NEAR MINI VIDHANA SOUDHA
OPP. TOWN HALL, HAMPANKATTA
MANGALORE-575 001

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2.
NATIONAL HIGHWAYS AUTHORITY OF INDIA
PROJECT IMPLEMENTATION UNIT
THARETHOTA, MANGALORE-575 002
REPRESENTED BY ITS
PROJECT DIRECTOR

3. THE ARBITRATOR AND
DEPUTY COMMISSIONER
DAKSHINA KANNADA DISTRICT
NEAR HAMILTON CIRCLE
MANGALORE- 575 001
...RESPONDENTS
(BY SRI: BYREGOWDA N, AGA FOR R1 & R3;
SRI: SHOBITH N. SHETTY, ADVOCATE FOR R2)
THIS MFA IS FILED U/S.37(1)(c) OF THE
ARBITRATION AND CONCILIATION ACT, 1996, AGAINST
THE JUDGMENT DT. 01.02.2024 PASSED IN
A.P.NO.16/2023 ON THE FILE OF THE IV ADDITIONAL
DISTRICT AND SESSIONS JUDGE, DAKSHINA KANNADA,
COMMERCIAL COURT, MANGALURU, DISMISSING THE
PETITION FILED U/S.34 OF THE ARBITRATION AND
CONCILIATION ACT, 1996.
THESE APPEALS, HAVING BEEN HEARD AND RESERVED
FOR JUDGMENT ON 24.09.2026 AND COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY,
T.P.VIVEKANANDA J., PRONOUNCED THE FOLLOWING:

CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN
and
HON'BLE MR. JUSTICE T.P.VIVEKANANDA

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CAV JUDGMENT
(PER: HON'BLE MR. JUSTICE T.P.VIVEKANANDA)

MFA.No.5039/2025 is filed by the appellant-National
Highway Authority of India challenging the award dated
03.01.2023 passed by the Arbitrator and the Deputy
Commissioner, Dakshina Kannada District, in proceedings
No.C.DIS.ARB(2)NH.LAQ.CR-38/2019-20, so also the
judgment dated 01.04.2025 in AP.No.123/2023 passed by
IV Additional District Judge and Commercial Court,
Dakshina Kannada, Mangaluru.


2. MFA.No.7070/2025 is filed by the landowners
challenging the aforesaid judgment and award being
dissatisfied with the determination of market value by the
learned Arbitrator, which has been confirmed by the
Commercial Court.
3. The brief facts leading to filing of the present
appeals are as follows:

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3.1 The land measuring 291.38 square meters (7.2
cents) in Survey No.27/5B of Surathkal Village, Mangaluru
Taluk, was notified for acquisition through Preliminary
Notification dated 08.09.2012 under Section 3A(1) of the
National Highways Act, 1956, (herein after referred to as
“the Act” for short), which was followed by the Final
Notification dated 29.08.2013 issued under Section 3D(1)
of the Act.
3.2 It is stated that the husband of the first
respondent-landowner namely Sri. Govinda Suvarna had
filed W.P.No.672/2014 along with other landowners
challenging the acquisition notifications on several
grounds. During the pendency of the said writ petition, the
Special Land Acquisition Officer, NHAI, passed an award
under Section 3G of the Act determining the market value
of the acquired land at Rs.43,262/- per cent. Simultaneous
with the challenge to the acquisition proceedings, the
respondents-landowners had filed a petition under Section
3G(5) of the Act before respondent No.6 seeking
redetermination of compensation for the acquired land.

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The said petition having been allowed by order dated
03.01.2023 resulted in redetermination of the
compensation at Rs.3,24,800/- per cent considering the
subject land as a garden land.
4. To arrive at the aforesaid value, respondent
No.6 - Deputy Commissioner/Arbitrator has relied upon an
award dated 22.09.2011 concerning the land situated at
Surathkal Village. The prayer of the landowners for
determination of market value at Rs.21,000/- per square
meter has been rejected by the learned Arbitrator holding
that in support of the said claim, no documentary evidence
was placed on record. It was the observation of the
learned Arbitrator that, determination of the market value
of the land shall be on the basis of the value prevailing as
on the date of issuance of Section 3A(1) Notification and
according to the learned Arbitrator, the award passed on
22.09.2011 in respect of an another extent of land in
Surathkal Village could be the guiding factor.
5. Before the learned Arbitrator, the landowners
have produced a copy of the sale deed dated 03.12.2012,

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which was registered after three months from the date of
issuance of the Notification under Section 3A of the Act.
The learned Arbitrator had refused to consider the said
sale deed on the ground that the said sale deed was
executed and registered after the issuance of the
Preliminary Notification. Therefore, the same cannot be
considered for the purpose of determination of the market
value.
6. Aggrieved by the determination of market value
at Rs.3,24,800/-, NHAI had filed AP.No.123/2023 before
the IV Additional District Judge and Commercial Court,
Dakshina Kannada, Mangaluru. Similarly, being dissatisfied
with the determination of market value by the learned
Arbitrator, the landowners have filed AP.No.16/2023
before the very same Court. Though, both the petitions
were pending before the same Court, for the reasons best
known to the parties, no request was made for clubbing of
both the Arbitration Petitions. AP.No.16/2023 filed by the
landowners had been disposed of on 01.02.2024 and

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AP.No.123/2023 filed by the NHAI was disposed of on
01.04.2025.
7. The fact of disposal of AP.No.16/2023 was not
brought to the notice of the very same Court, in which
AP.No.123/2023 was pending. Nevertheless, both the
Arbitration Petitions filed by the landowners, so also by the
NHAI have been dismissed confirming the award passed
by the learned Arbitrator. While dismissing the Arbitration
Petitions filed by the landowners, so also the NHAI, the
District Court/Commercial Court has held that the
petitioners in both the petitions have failed to make out a
ground for setting aside the award of the learned
Arbitrator within the parameters and the grounds
enumerated in Section 34(2) of the Arbitration and
Conciliation Act, 1996. It is the specific finding of the
District Court that the petitioners in both the petitions
have failed to make out a ground for setting aside the
arbitral award.
8. There is a finding by the District Court in the
appeal filed by the landowners that, since the subject land

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was abutting the National Highway and the portion of the
land belonged to the petitioners have been acquired for
the purpose of expansion of National Highway, though, the
land is an agricultural land, the potentiality of the
agricultural land for use of the same for non-agricultural
purposes cannot be ruled out. It is also the observation of
the District Court that the learned Arbitrator was
persuaded to redetermine the market value, since the
subject land is a garden land.
9. As stated supra, the NHAI as well as the
landowners are before this Court through these two
separate appeals. The grounds urged in the appeal filed by
the NHAI are that the landowners are entitled for the
market value, which was prevailing on the date of
issuance of the Preliminary Notification. However, the
learned Arbitrator has not considered the market value of
the land as on the date of Preliminary Notification.
Therefore, the award suffers from the patent illegality. The
claim of the landowners for redetermination of
compensation could not have been considered by the

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learned Arbitrator. It is his further submission that in view
of the pendency of W.P.No.672/2014, the possession of
the notified land was never handed over/surrendered by
the landowners to the National Highway Authority.
Therefore, even if this Court were to confirm the award of
the learned Arbitrator, so also the judgment of the District
Court, the landowners cannot be made entitled for
payment of interest on the market value in terms of
Section 3H(5) of the NHAI Act.
10. The appeal filed by the landowners is with the
delay of 504 days. Learned counsel for the NHAI has
brought to our notice that the landowners have filed
Execution Case No.76/2025 to execute the award of the
learned Arbitrator dated 03.01.2023 and in the said
execution proceedings, the NHAI has deposited 50% of the
compensation. Simultaneously, the husband of respondent
No.1 in MFA.No.5039/2025 filed by the NHAI and appellant
No.1 in MFA.No.7070/2025 was prosecuting
W.P.No.672/2014, whereby the acquisition proceedings
itself was challenged. When that being the position, the

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reasons assigned for inordinate delay of 504 days do not
constitute sufficient reason. Therefore, the application for
condonation of delay is liable to be rejected.
11. Learned counsel for the landowners has relied
upon the judgment of the Hon’ble Supreme Court in the
case of Suresh Kumar Vs. State of Haryana and
Others reported in 2025 Supreme (SC) 695 to persuade
this Court to condone the delay of 504 days on the ground
that in the cases relating to acquisition of land and grant
of compensation liberal approach to be adopted while
considering the application for condonation of delay. We
notice that the said judgment was rendered in the context
of acquisition of land under the Land Acquisition Act, 1894
and therefore, the same cannot be made applicable to the
facts of the present case.
12. Learned counsel has further relied upon the
judgment of the High Court of Kerala in the case of
National Highways Authority of India Vs. P.V.George
reported in 2024 Supreme (Ker) 733 and contends that
the National Highways Act does not prescribe a limitation

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period for arbitration and therefore, the Limitation Act
does not apply. The said judgment is rendered in the
context of filing a petition before the learned Arbitrator
and not while considering an appeal under Section 37 of
the Arbitration and Conciliation Act, 1996. The facts
involved in the judgment relied upon by the learned
counsel for the landowners is not applicable to the facts of
the present case.
13. The learned counsel for the appellant in
MFA.No.7070/2025, that is, the appeal filed by the
landowners, has advanced the contention that a sale
exemplar subsequent to the issuance of the preliminary
notification could also be considered if the date of sale is
within close proximity to the date of issuance of the
preliminary notification. In support of the said contention,
reliance is placed on the judgment of the Hon'ble Apex
Court in the case of Chimanlal Hargovinddas v. Special
Land Acquisition Officer, Poona, reported in (1988) 3
SCC 751 , and also on other judgments laying down the
very same proposition. It is the submission of the learned

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counsel that the sale deed dated 03.12.2012, which was
registered within three months of issuance of the
preliminary notification, discloses a sale consideration of
Rs.14,964/- per square metre and that the said value
ought to have been considered by the learned Arbitrator.
14. The aforesaid contention deserves to be
rejected for the reason that the purchaser of the property
under the sale deed referred to supra is one Sri
Sadananda A.V., and the land purchased by him under the
said sale deed was also notified for acquisition in the very
same preliminary notification. The said purchaser has also
approached the learned Arbitrator for redetermination of
compensation. The learned Arbitrator had rejected the
claim of Sri Sadananda A.V. for redetermination of
compensation, taking note of the sale consideration shown
in the sale deed dated 03.12.2012. From the above, it is
discernible that, knowing fully well that the land was
notified under the preliminary notification, Sri Sadananda
A.V. had purchased the land at a higher value, probably
with a view to claim compensation at the same rate as the

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sale consideration reflected in the registered instrument
multiplied by applicable factor under 2013 Act. This
transaction of sale under the sale deed dated 03.12.2012,
entered into by a person whose land was itself notified for
acquisition, cannot be considered a bona fide transaction
so as to place reliance on the registered sale deed for the
purpose of redetermination of market value in respect of
all the lands covered under the preliminary notification in
question.
15. It is not in dispute that the present appeal rose
out of the proceedings under Section 37 of the Arbitration
and Conciliation Act, 1996, challenging the judgment
passed by the Commercial Court in the proceedings under
Section 34 of the Arbitration and Conciliation Act, 1996.
Though, the appeal filed by the NHAI and landowners are
classified as miscellaneous first appeals, however, in
effect, the appeals are not only under Section 37(1)(c) of
the Arbitration and Conciliation Act, 1996, it is also under
Section 13(1A) of the Commercial Courts Act, 2015.
Therefore, law of limitation in respect of the appeals filed

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under the provisions of the Commercial Courts Act is
equally applicable in respect of the present appeals. The
Hon'ble Supreme Court in the cases of Government of
Maharashtra (Water Resources Department) Vs.
Borse Brothers Engineers and Contractors Private
Limited reported in (2021) 6 SCC 460 has clearly held
that sufficient cause for condonation of delay must be
assessed in the context of the statutory object of speedy
resolution of disputes. The Hon'ble Supreme Court held
the following:-
"58. Given the object sought to be achieved
under both the Arbitration Act and the Commercial
Courts Act, that is, the speedy resolution of disputes,
the expression “sufficient cause” is not elastic
enough to cover long delays beyond the period
provided by the appeal provision itself. Besides, the
expression “sufficient cause” is not itself a loose
panacea for the ill of pressing negligent and stale
claims. This Court, in Basawaraj v. LAO , has held :
(SCC pp. 85-88, paras 9-15)

“9. Sufficient cause is the cause for which
the defendant could not be blamed for his
absence. The meaning of the word “sufficient”
is “adequate” or “enough”, inasmuch as may
be necessary to answer the purpose intended.
Therefore, the word “sufficient” embraces no
more than that which provides a platitude,
which when the act done suffices to accomplish
the purpose intended in the facts and
circumstances existing in a case, duly

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examined from the viewpoint of a reasonable
standard of a cautious man. In this context,
“sufficient cause” means that the party should
not have acted in a negligent manner or there
was a want of bona fide on its part in view of
the facts and circumstances of a case or it
cannot be alleged that the party has “not acted
diligently” or “remained inactive”. However,
the facts and circumstances of each case must
afford sufficient ground to enable the court
concerned to exercise discretion for the reason
that whenever the court exercises discretion, it
has to be exercised judiciously. The applicant
must satisfy the court that he was prevented
by any “sufficient cause” from prosecuting his
case, and unless a satisfactory explanation is
furnished, the court should not allow the
application for condonation of delay. The court
has to examine whether the mistake is bona
fide or was merely a device to cover an ulterior
purpose.

10. In Arjun Singh v. Mohindra Kumar this
Court explained the difference between a
“good cause” and a “sufficient cause” and
observed that every “sufficient cause” is a
good cause and vice versa. However, if any
difference exists it can only be that the
requirement of good cause is complied with on
a lesser degree of proof than that of “sufficient
cause”.

11. The expression “sufficient cause”
should be given a liberal interpretation to
ensure that substantial justice is done, but
only so long as negligence, inaction or lack of
bona fides cannot be imputed to the party
concerned, whether or not sufficient cause has
been furnished, can be decided on the facts of
a particular case and no straitjacket formula is
possible.

12. It is a settled legal proposition that law
of limitation may harshly affect a particular

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party but it has to be applied with all its rigour
when the statute so prescribes. The court has
no power to extend the period of limitation on
equitable grounds. ‘A result flowing from a
statutory provision is never an evil. A court has
no power to ignore that provision to relieve
what it considers a distress resulting from its
operation.’ The statutory provision may cause
hardship or inconvenience to a particular party
but the court has no choice but to enforce it
giving full effect to the same. The legal maxim
dura lex sed lex which means “the law is hard
but it is the law”, stands attracted in such a
situation. It has consistently been held that,
“inconvenience is not” a decisive factor to be
considered while interpreting a statute.

13. The statute of limitation is founded on
public policy, its aim being to secure peace in
the community, to suppress fraud and perjury,
to quicken diligence and to prevent oppression.
It seeks to bury all acts of the past which have
not been agitated unexplainably and have from
lapse of time become stale. According to
Halsbury's Laws of England, Vol. 28, Para 605
p. 266:

‘605. Policy of the Limitation Acts.—The
courts have expressed at least three differing
reasons supporting the existence of statutes of
limitation, namely, (1) that long dormant
claims have more of cruelty than justice in
them, (2) that a defendant might have lost the
evidence to disprove a stale claim, and (3) that
persons with good causes of actions should
pursue them with reasonable diligence.’

An unlimited limitation would lead to a
sense of insecurity and uncertainty, and
therefore, limitation prevents disturbance or
deprivation of what may have been acquired in
equity and justice by long enjoyment or what
may have been lost by a party's own inaction,
negligence or laches.

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14. In P. Ramachandra Rao v. State of
Karnataka this Court held that judicially
engrafting principles of limitation amounts to
legislating and would fly in the face of law laid
down by the Constitution Bench in Abdul
Rehman Antulay v. R.S. Nayak .

15. The law on the issue can be
summarised to the effect that where a case
has been presented in the court beyond
limitation, the applicant has to explain the
court as to what was the “sufficient cause”
which means an adequate and enough reason
which prevented him to approach the court
within limitation. In case a party is found to be
negligent, or for want of bona fide on his part
in the facts and circumstances of the case, or
found to have not acted diligently or remained
inactive, there cannot be a justified ground to
condone the delay. No court could be justified
in condoning such an inordinate delay by
imposing any condition whatsoever. The
application is to be decided only within the
parameters laid down by this Court in regard
to the condonation of delay. In case there was
no sufficient cause to prevent a litigant to
approach the court on time condoning the
delay without any justification, putting any
condition whatsoever, amounts to passing an
order in violation of the statutory provisions
and it tantamounts to showing utter disregard
to the legislature.”

x x x x x

63. Given the aforesaid and the object of
speedy disposal sought to be achieved both
under the Arbitration Act and the Commercial
Courts Act, for appeals filed under Section 37
of the Arbitration Act that are governed by
Articles 116 and 117 of the Limitation Act or
Section 13(1-A) of the Commercial Courts Act,
a delay beyond 90 days, 30 days or 60 days,

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respectively, is to be condoned by way of
exception and not by way of rule. In a fit case
in which a party has otherwise acted bona fide
and not in a negligent manner, a short delay
beyond such period can, in the discretion of
the court, be condoned, always bearing in
mind that the other side of the picture is that
the opposite party may have acquired both in
equity and justice, what may now be lost by
the first party's inaction, negligence or laches."


16. In the case of State of Uttar Pradesh Vs.
Satish Chand Shivhare and Brothers reported in 2022
SCC ONLINE SC 2151 , the Hon'ble Supreme Court
declined to interfere with the dismissal of an appeal under
Section 37 where sufficient cause had not been shown for
a delay of 337 days. It was held that the right of appeal is
subject to limitation and that a liberal approach requires a
plausible explanation for the delay.

17. In the light of the aforesaid enunciation of law
by the Hon'ble Supreme Court, we do not find it
appropriate to condone the long delay of 504 days in filing
the appeal by the landowners. Accordingly, the
application for condonation of delay is rejected and
consequently, the appeal is also dismissed.

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18. Insofar as the appeal filed by the NHAI is
concerned, the District Court has rendered a categorical
finding that the NHAI has not made out any ground for
setting aside the arbitral award within the parameters of
Section 34(2) of the Arbitration and Conciliation Act, 1996.
If the District Court while exercising the power under
Section 34(2) of the Arbitration and Conciliation Act, 1996,
has held that no grounds are made out for setting aside
the arbitral award, this Court while considering an appeal
under Section 37 of the Arbitration and Conciliation Act,
1996, is not in a position to take a different view than that
of the view taken by the District Court under Section 34 of
the Arbitration and Conciliation Act, 1996. The grounds
urged by the NHAI in the memorandum appeal, so also the
arguments advanced would not in any way make out a
ground for interference of the arbitral award and
confirmed by the District Court.
19. The scope of interference of this Court in an
appeal under Section 37 of the Arbitration Act has been
categorically laid down by the Apex Court MMTC Ltd. v.

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Vedanta Ltd. reported in (2019) 4 SCC 163. The Apex
Court held as follows:-
"11. As far as Section 34 is concerned, the
position is well-settled by now that the Court does
not sit in appeal over the arbitral award and may
interfere on merits on the limited ground provided
under Section 34(2)(b)(ii) i.e. if the award is
against the public policy of India. As per the legal
position clarified through decisions of this Court
prior to the amendments to the 1996 Act in 2015,
a violation of Indian public policy, in turn, includes
a violation of the fundamental policy of Indian
law, a violation of the interest of India, conflict
with justice or morality, and the existence of
patent illegality in the arbitral award. Additionally,
the concept of the “fundamental policy of Indian
law” would cover compliance with statutes and
judicial precedents, adopting a judicial approach,
compliance with the principles of natural justice,
and Wednesbury reasonableness. Furthermore,
“patent illegality” itself has been held to mean
contravention of the substantive law of India,
contravention of the 1996 Act, and contravention
of the terms of the contract.

12. It is only if one of these conditions is met
that the Court may interfere with an arbitral
award in terms of Section 34(2)(b)(ii), but such
interference does not entail a review of the merits
of the dispute, and is limited to situations where
the findings of the arbitrator are arbitrary,

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capricious or perverse, or when the conscience of
the Court is shocked, or when the illegality is not
trivial but goes to the root of the matter. An
arbitral award may not be interfered with if the
view taken by the arbitrator is a possible view
based on facts.
14. As far as interference with an order made
under Section 34, as per Section 37, is
concerned, it cannot be disputed that such
interference under Section 37 cannot travel
beyond the restrictions laid down under Section
34. In other words, the court cannot undertake an
independent assessment of the merits of the
award, and must only ascertain that the exercise
of power by the court under Section 34 has not
exceeded the scope of the provision. Thus, it is
evident that in case an arbitral award has been
confirmed by the court under Section 34 and by
the court in an appeal under Section 37, this
Court must be extremely cautious and slow to
disturb such concurrent findings."
20. These principles were reaffirmed in Konkan
Railway Corpn. Ltd. v. Chenab Bridge Project reported
in (2023) 9 SCC 85 , wherein the Apex Court held that
the jurisdiction of the court under Section 37 of the
Arbitration Act is akin to its jurisdiction under Section 34
of the Arbitration Act, and that the scope of interference in

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an appeal under Section 37 of the Arbitration Act, while
examining an order setting aside or refusing to set aside
an award, is restricted to and subject to the same grounds
as a challenge under Section 34 the Arbitration Act. It was
also held that the jurisdiction under Sections 34 and 37
the Arbitration Act is not in the nature of normal appellate
jurisdiction.
21. The narrow jurisdiction under Section 37 of the
Arbitration Act was also laid down in UHL Power
Company Ltd. v. State of Himachal Pradesh reported
in (2022) 4 SCC 116 . This line of reasoning was further
affirmed in Larsen Air Conditioning & Refrigeration
Co. v. Union of India reported in (2023) 15 SCC 472 ,
wherein the Apex Court held that the jurisdiction of the
court under Section 34 of the Arbitration Act is limited and
extremely circumscribed, permitting interference only on
the ground of patent illegality which goes to the root of
the matter and is not of a trivial nature.

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22. The Apex Court in Punjab State Civil
Suppliers Corporation Limited and Another v. M/s
Sanman Rice Mills and Others reported in 2024 INSC
742, held that an Arbitral Award is not liable to be
interfered with only on the ground that the award is illegal
or is erroneous in law, that too upon reappraisal of the
evidence adduced before the arbitral trial. Even an award
which may not be reasonable or is non-speaking to some
extent cannot ordinarily be interfered with by the Courts.
It is also well settled that even if two views are possible,
there is no scope for the Court to reappraise the evidence
and to take the different view other than what has been
taken by the arbitrator.
23. Further, in Somdatt Builders-NCC-NEC(JV)
v. National Highways Authority of India and Ors.
reported in 2025 INSC 113 , the Apex Court after
considering the case law on the point, held as under:-
"42. As already discussed above, the Arbitral
Tribunal had interpreted Clause 51 in a reasonable
manner based on the evidence on record. This
interpretation was affirmed by the learned Single Judge

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exercising jurisdiction under Section 34 of the 1996
Act. Therefore, Division Bench of the High Court was
not at all justified in setting aside the arbitral award
exercising extremely limited jurisdiction under
Section 37 of the 1996 Act by merely using expressions
like ‘opposed to the public policy of India’, ‘patent
illegality’ and ‘shocking the conscience of the court’. As
reiterated by this Court in Reliance Infrastructure Ltd.
(supra), it is necessary to remind the courts that a
great deal of restraint is required to be shown while
examining the validity of an arbitral award when such
an award has been upheld, wholly or substantially,
under Section 34 of the 1996 Act. Frequent interference
with arbitral awards would defeat the very purpose of
the 1996 Act."

24. It is brought to our notice that the total extent
of land in Survey No.27/5B is 617 square meters, out of
which, 202.35 square meters is a converted land and
414.65 square meters is a garden land. Out of 414.65
square meters of garden land, 291.38 square meters is
acquired by the NHAI. The fact that the portion of the very
same survey number has been converted for non-
agricultural purpose is a clear indication that the other
extent of the very same survey number had the same
potentiality of the converted land. It is also a fact that the

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subject land is abutting and facing the National Highway.
Therefore, the determination of the market value by the
learned Arbitrator based on an award passed in the year
2011 in respect of an another extent of land in the very
same village cannot be found fault with. It is now well
established that there cannot be different yardstick for
determination of the market value in respect of the lands
situated in the very same village.
25. In addition to the above, before the learned
Arbitrator except the oral statement and the averment
made in the petition that the subject lands are very near
to National Highway and within the limits of Mangaluru
City Corporation and located within the vicinity of several
Engineering Colleges and Hospitals, no other material
evidence was placed by the claimants. Therefore, it cannot
be said that the reliance placed on the earlier award in
respect of the land in the very same village is erroneous
when the said award has been accepted by NHAI.
26. We have also noticed from the award of the
Land Acquisition Officer, which is produced by the learned

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counsel for the landowners along with the memo, wherein
it is erroneously observed by the Land Acquisition Officer
that 202.35 square meters of converted land is also
acquired. However, the fact remains that what is acquired
is 291.38 square meters, which is a garden land. We find
no illegality much less patent illegality in the award passed
by the Arbitrator and the judgment of the District Court so
as to interfere under Section 37 of the Act.
27. In the result:
(i) MFA.No.5039/2025 filed by the NHAI and
MFA.No.7070/2025 filed by the landowners are
dismissed .
(ii) It is clarified that the entitlement of interest at
9% per annum on the compensation
redetermined by the learned Arbitrator/Deputy
Commissioner would be only from the date on
which the landowners surrenders/handover the
acquired land in favour of the NHAI in terms of

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Section 3H(5) of the National Highways Act,
1956.
(iii) The aforesaid observation is made in the light
of the contention advanced by the learned
counsel for NHAI that in view of pendency of
W.P.No.672/2014, which was disposed of on
08.06.2026, the landowners have not either
surrendered or handed over possession to the
NHAI and NHAI could not carry out any
developmental work in the subject lands.


Sd/-
(ANU SIVARAMAN)
JUDGE


Sd/-
(T.P.VIVEKANANDA)
JUDGE






PB