THE NATIONAL HIGHWAYS AUTHORITY OF INDIA vs IRAVVA W/O CHANNABASAPPA P

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IN THE HIGH COURT OF KARNATAKA AT DHARWAD

®


TH
DATED THIS THE 9 DAY OF JULY, 2026

PRESENT

THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV

AND

THE HON'BLE MRS JUSTICE K.G.SHANTHI

MISCELLANEOUS FIRST APPEAL NO.105456 OF 2025 C/W


MISCELLANEOUS FIRST APPEAL NO.105455 OF 2025 (AA)

IN MFA NO. 105456/2025:

BETWEEN:
1. THE NATIONAL HIGHWAYS AUTHORITY OF INDIA,
THROUGH IS PROJECT DIRECTOR SHIRISH GANGADHAR,
AGE: MAJOR, OCC. THE PROJECT DIRECTOR IN CHARGE,
PIU, CHITRADURGA, R/O. PROJECT IMPLEMENTATION
UNIT, CHITRADURGA-577501.

2. THE MANAGER (TECH)/ SLAO AND OFFICE OF
THE COMPETENT AUTHORITY OF INDIA FOR LAND
ACQUISITION, NATIONAL HIGHWAYS AUTHORITY OF
INDIA, KSRTC DEPO ROAD, CHITRADURGA,
ST
NOW AT: 1 MAIN ROAD, BANK COLONY,
CHITRADURGA-577501.

- APPELLANTS
(BY SRI. B.P. MATHAPATI AND SRI. S.G. HIREMATH, ADVOCATES)

AND:








VINAYAKA
B V

Digitally signed by
VINAYAKA B V
Location: High Court of
Karnataka, Dharwad
Bench
Date: 2026.07.22
14:29:52 +0530
1. IRAVVA W/O. CHANNABASAPPA P.,
AGE: 69 YEARS, OCC. HOUSEHOLD,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

2. THE DEPUTY COMMISSIONER AND ARBITRATOR,
NH-4, HAVERI, DIST. HAVERI-581110.

- RESPONDENTS
(BY SRI. LAXMAN T. MANTAGANI, ADVOCATE FOR R1;
SRI. PRAVEEN K. UPPAR, AGA FOR R2)

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THIS MISCELLANEOUS FIRST APPEAL IS FILED U/S 37(1) OF
ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO SET
ASIDE THE REVISED JUDGMENT PASSED BY THE PRINCIPAL
DISTRICT AND SESSIONS JUDGE, HAVERI IN ARBITRATION PETITION
NO.93/2022 DATED 31.01.2024 AND ETC.

IN MFA NO. 105455/2025:
BETWEEN:
1. THE NATIONAL HIGHWAYS AUTHORITY OF INDIA,
THROUGH ITS PROJECT DIRECTOR SHIRISH GANGADHAR,
AGE: MAJOR, OCC. THE PROJECT DIRECTOR IN CHARGE,
PIU, CHITRADURGA, R/O. PROJECT IMPLEMENTATION UNIT,
CHITRADURGA-577501.

2. THE MANAGER (TECH) / SLAO AND OFFICE OF THE
COMPETENT AUTHORITY OF INDIA FOR LAND ACQUISITION
NATIONAL HIGHWAYS AUTHORITY OF INDIA,
KSRTC DEPOT ROAD, CHITRADURGA,
ST
NOW AT: 1 MAIN ROAD, BANK COLONY,
CHITRADURGA-577501.

- APPELLANTS
(BY SRI. B.P. MATHAPATI AND SRI. S.G. HIREMATH,
ADVOCATES)

AND:
BALABHEEMAPPA @ BASAPPA THROUGH LEGAL
REPRESENTATIVES MANOHAR AND ORS,

MANOHAR S/O. BASAPPA MALAGOD @ DODDAMANI,
SINCE DECEASED BY HIS LRS,

1. GIRIJAVVA W/O. GIRISH GACHCHINAMANI,
AGE: 35 YEARS, OCC. HOUSEHOLD,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

2. DARMARAJ S/O. MANOHAR MALAGOD,
AGE: 35 YEARS, OCC. AGRICULTURE,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

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3. CHANDRAKALA W/O. VENKATESH PATRODI,
AGE: 29 YEARS, OCC. HOUSEHOLD,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

4. SHIVANAND S/O. MANOHAR MALAGOD,
AGE: 30 YEARS, OCC. AGRICULTURE,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

5. KUMAR S/O. MANOHAR MALAGOD,
AGE: 28 YEARS, OCC. AGRICULTURE,
R/O. DEVAGIRI-YALLAPUR,
TQ. HAVERI, DIST. HAVERI-581110.

6. THE DEPUTY COMMISSIONER AND ARBITRATOR,
NH-4, HAVERI, DIST. HAVERI 581110.

- RESPONDENTS
(BY SRI. LAXMAN T. MANTAGANI, ADVOCATE FOR R1 TO R5;
SRI. PRAVEEN K. UPPAR, AGA FOR R6)

THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER
SECTION 37(1)(E) OF THE ARBITRATION AND CONCILIATION
ACT 1996, PRAYING TO SET ASIDE THE REVISED JUDGMENT
PASSED BY THE HON’BLE PRINCIPAL DISTRICT AND SESSIONS
JUDGE, HAVERI IN ARBITRATION PETITION NO.92/2022 DATED
30.01.2024 AND ETC.

THESE MISCELLANEOUS FIRST APPEALS COMING ON FOR
FURTHER ORDERS, THIS DAY, JUDGMENT WAS DELIVERED
THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV
AND
HON'BLE MRS JUSTICE K.G.SHANTHI

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ORAL JUDGMENT
(PER: HON'BLE MRS JUSTICE K.G.SHANTHI)

Since both the appeals are arising out of the same
question of law and facts they are taken up together for
discussion.

2. The judgment and award passed by the learned
Principal District & Sessions, Haveri (for short, ‘ trial
Court ’) in Arbitration Petition No. 92/2022 and No.93/2012
dated 22.05.2023 are under challenge in these appeals
under Section 37(1) of The Arbitration and Conciliation
Act, 1996 (for short, ‘ Act ’) by the National Highways
Authority of India (for short, ‘ NHAI ’).

3. Brief facts of the case of the appellant is that the
lands of the respondents herein was acquired by the
appellant for four lane project of the NHAI at Devagiri-
Yellapur village. The award was passed by the competent
authority and acquired lands particulars are disclosed in
the following chart.

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Case No. Order
No. (LAQ
/ARBT/
NH/CR)
Sy. No. Acquired
area in
Sq.Mtrs
(Dry
land-NA
land)
Awarded
rate by
SLAO
per
Sqm.
Award of
Arbitrator
Arb.P.92/22 546/
2009-10
92/2+3/13 4957 35.60 346/-
Arb.P.93/22 3/2013-
14
95/1+2/B &
2(95/1+2/B)
11620 35.60 346/-
Arb.P.96/22 390/
2009-10
92/1A+2B &
100
2326 and
1671
35.60 346/-

Aggrieved by the rates fixed for acquisition, the claimants
have filed claim petitions which are referred to the
Arbitrator and the Arbitrator awarded compensation at the
rate of Rs.346/- per sq.ft. Being aggrieved by the same,
the NHAI filed Arbitration Petition No. 92/2022 and
93/2022 which were disposed of vide judgment dated
22.05.2023 confirming the award of the Deputy
Commissioner/Arbitrator, Haveri. The landlosers preferred
Review Petition before the trial Court seeking review of the
judgment. The trial Court on hearing the matter modified
the award of the Arbitrator by order dated 31.01.2024
which have been challenged in the present appeals.

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4. Upon service of notice the respondents appeared
through their counsel and opposed the contention taken in
the appeal.

5. Learned Advocate for the appellant in the appeals
contended that the trial Court has violated the provisions
of Section 34 of the Act, wherein it modified the award
which is not permissible under law. Further, it is argued
that the trial Court has reviewed its own judgment in
Review Petition No. 11/2023 and No. 12/2023 which is
beyond the scope of the Civil Court.

6. Learned Advocate for the appellant has drawn the
attention of this Court the order passed by the Coordinate
Bench of this Court in the case of The Deputy General
Manager (Tech) and The Project Director, National
Highways Authority of India and Another Vs.
Durgavva and another (M.F.A. No. 102334/2024)
dated 28.10.2024 which is passed under similar
circumstances. In the said judgment a reference is made to

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the judgment of the Apex Court in the case of Project
Director, National Highways Authority of India Vs.
M.Hakeem and another (2021) 9 SCC 1 wherein the
Apex Court while dealing with the powers of the District
Court in a suit filed under Section 34 of the Act, in
paragraphs No. 42 and 48 has held as under:
“42. It can therefore be said that this question has now
been settled finally by at least 3 decisions of this Court.
Even otherwise, to state that the judicial trend appears to
favour an interpretation that would read into Section 34 a
power to modify, revise or vary the award would be to
ignore the previous law contained in the 1940 Act; as also
to ignore the fact that the 1996 Act was enacted based on
the UNCITRAL Model Law on International Commercial
Arbitration, 1985 which, as has been pointed out in Redfern
and Hunter on International Arbitration, makes it clear
that, given the limited judicial interference on extremely
limited grounds not dealing with the merits of an award,
the ‘limited remedy’ under Section 34 is co-terminus with
the ‘limited right’, namely, either to set aside an award or
remand the matter under the circumstances mentioned in
Section 34 of the Arbitration Act, 1996.
Xxxx
48. Quite obviously if one were to include the power to
modify an award in Section 34, one would be crossing the
Lakshman Rekha and doing what, according to the justice

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of a case, ought to be done. In interpreting a statutory
provision, a Judge must put himself in the shoes of
Parliament and then ask whether Parliament intended this
result. Parliament very clearly intended that no power of
modification of an award exists in Section 34 of the
Arbitration Act, 1996. It is only for Parliament to amend
the aforesaid provision in the light of the experience of the
courts in the working of the Arbitration Act, 1996, and
bring it in line with other legislations the world over.”

7. Further, the Hon'ble Apex Court in Gayathri
Balaswamy v. M/s ISG Novasoft Technologies
Limited (Civil Appeal No.(s) 6178-6179/2025 , the
Apex Court observed at conclusion (f) has observed as
under:
“(f) Hakeem (supra) is not per incuriam insofar as it
held that a Section 34 Court cannot modify the award and
will be read with the only exception made in this judgment
now. On the principle of actus curiae neminem gravabit
(act of Court shall prejudice no one) computation, clerical
and typographical errors or other errors of similar nature is
permissible to be corrected by the Section 34 Court, in
terms of the holding above.”

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8. The Hon’ble Apex Court in the case of Oil and
Natural Gas Corporation Ltd., Vs. Saw Pipes Ltd.,
reported in AIR 2003 Supreme Court Cases 2629 , has
held as under:
“31. Therefore, in our view, the phrase “public policy of
India” used in Section 34 in context is required to be given
a wider meaning. It can be stated that the concept of public
policy connotes some matter which concerns public good
and the public interest. What is for public good or in public
interest or what would be injurious or harmful to the public
good or public interest has varied from time to time.
However, the award which is, on the face of it, patently in
violation of statutory provisions cannot be said to be in
public interest. Such award/judgment/decision is likely to
adversely affect the administration of justice. Hence, in our
view in addition to narrower meaning given to the term
“public policy” in Renusagar case10 it is required to be held
that the award could be set aside if it is patently illegal. The
result would be — award could be set aside if it is contrary
to:
(a) fundamental policy of Indian law; or
(b) the interest of India; or
(c) justice or morality, or [pic](d) in addition, if it is
patently illegal.
Illegality must go to the root of the matter and if the
illegality is of trivial nature it cannot be held that award is
against the public policy. Award could also be set aside if it
is so unfair and unreasonable that it shocks the conscience

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of the court. Such award is opposed to public policy and is
required to be adjudged void.”

9. The Apex Court in Project Director, National
Highways no. 45 E and 220 National Highways
Authority of India Vs. M. Hakeem and another at
paragraphs no. 42 and 48 has held as under:
“42. It can therefore be said that this question has now
been settled finally by at least 3 decisions of this Court.
Even otherwise, to state that the judicial trend appears to
favour an interpretation that would read into Section 34 a
power to modify, revise or vary the award would be to
ignore the previous law contained in the 1940 Act; as also
to ignore the fact that the 1996 Act was enacted based on
the UNCITRAL Model Law on International Commercial
Arbitration, 1985 which, as has been pointed out in Redfern
and Hunter on International Arbitration, makes it clear that,
given the limited judicial interference on extremely limited
grounds not dealing with the merits of an award, the
‘limited remedy’ under Section 34 is co- terminus with the
‘limited right’, namely, either to set aside an award or
remand the matter under the circumstances mentioned
in Section 34 of the Arbitration Act, 1996.

xxxx

48. Quite obviously if one were to include the power to
modify an award in Section 34 , one would be crossing the
Lakshman Rekha and doing what, according to the justice
of a case, ought to be done. In interpreting a statutory

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provision, a Judge must put himself in the shoes of
Parliament and then ask whether Parliament intended this
result. Parliament very clearly intended that no power of
modification of an award exists in Section 34 of the
Arbitration Act, 1996. It is only for Parliament to amend the
aforesaid provision in the light of the experience of the
courts in the working of the Arbitration Act, 1996 , and
bring it in line with other legislations the world over.”

10. The Apex Court in Mcdermott International INC
Vs Burn Standard Co. Ltd., and Others reported in
(2006) 11 Supreme Court Cases 181 has held at
paragraphs no. 52 and 59 as under:
“52. The 1996 Act makes provision for the supervisory
role of courts, for the review of the arbitral award only to
ensure fairness. Intervention of the court is envisaged in
few circumstances only, like, in case of fraud or bias by the
arbitrators, violation of natural justice, etc. The court
cannot correct errors of the arbitrators. It can only quash
the award leaving the parties free to begin the arbitration
again if it is desired. So, scheme of the provision aims at
keeping the supervisory role of the court at minimum level
and this can be justified as parties to the agreement make
a conscious decision to exclude the court's jurisdiction by
opting for arbitration as they prefer the expediency and
finality offered by it.
xxxx

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59. Such patent illegality, however, must go to the root
of the matter. The public policy violation, indisputably,
should be so unfair and unreasonable as to shock the
conscience of the court. Where the Arbitrator, however, has
gone contrary to or beyond the expressed law of the
contract or granted relief in the matter not in dispute would
come within the purview of Section 34 of the Act. However,
we would consider the applicability of the aforementioned
principles while noticing the merit of the matter.”

The Apex Court observed that:
“The Court cannot correct the errors of Arbitrator. It can
only quash the award leaving the parties free to begin the
arbitration again if it is so desired”. The Arbitral Award can
be set aside, which is contrary to:
(a) fundamental policy of Indian law; or
(b) the interest of India; or
(c) justice or morality; or
(d) in addition, if it is patently legal.”

11. The Apex Court in S.V.Samudram Vs. State of
Karnataka and another reported in (2024) 3 SCC 623 ,
it is observed as under:
“Any Court under Section 34 of the 1996 Act would
have no jurisdiction to modify the arbitral award, which at
best, given the same to be in conflict with the grounds
specified under Section 34 of the 1996 Act would be wholly
unsustainable in law.

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It is also observed that,
Any attempt to ‘modify an award’ under Section 34
would amount to ‘crossing the Lakshman Rekha’.

13. In Gayatri Balaswamy (supra) the Apex Court in
detail observed as under:
“(a) The Courts exercising power under Section 34 and
Courts hearing appeals thereunder have no power to
‘modify’ an award;
(b) The power to modify is not a lesser power to that of
the power to set aside, as the two operate in separate
spheres and are not of the same genus.
(c) The inherent power under Section 151 C.P.C. cannot
be used to modify awards as it will be contrary to the
express power mentioned in Section 34. Similarly, there is
no scope for applying the doctrine of implied power to
modify awards.
(d) Article 141 of the Constitution of India will not be
exercised by this Court to modify awards passed by
arbitrators as it is well settled that the Article 142 power
cannot be used to give a go by to the substantive statutory
provision.
(e) Interest awarded also cannot be modified in exercise
of powers of setting aside and the course of action under
Section 34(4) will have to be adopted as discussed in the
judgment.”

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14. In the case on hand the trial Court reviewed and
modified its own judgment which is not sustainable. This is
when the law is clear that the Court has no jurisdiction to
modify the award under Section 34 of the Act. Hence this
Court is of the opinion that the impugned judgment and
award passed by the trial Court in a case filed u/S 34 of
the Act, is not proper and correct. The principle and law is
very clear that the District Court has the power either to
confirm or set aside the award of the Arbitrator and
remand the matter to the Arbitrator. However, in the case
on hand the trial Court has modified the award of the
Arbitrator passed u/S 34 of the Act which is not sustainable
in law.

15. For the foregoing reasons, this Court is of the opinion
that the impugned award passed by the Learned Principal
District Judge is liable to be set aside and matter is
remanded back for fresh consideration in accordance with
law. Ordered accordingly.

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Pending application/s also stand disposed of.


Sd/-
(S.SUNIL DUTT YADAV)
JUDGE


Sd/-
(K.G.SHANTHI)
JUDGE
BVV
LIST NO.: 2 SL NO.: 47