Arbitrator's land valuation for commercial use upheld; enhanced easementary rights justified by remaining land.

The National Highways Authority of India (NHAI) acquired 2542 Sq. Mtrs. of land from Gat No. 213 in Pimpri Sekam, Taluka Bhusawal, District Jalgaon, for highway expansion.

The claimant, Kerman Sam Amroliwala, operated a petrol pump on the adjacent and acquired land.

The competent authority initially awarded Rs. 19,69,229/- as total compensation, including Rs. 15,12,498/- for land at Rs. 595/- per Sq. Mtr., and Rs. 1,51,249/- (10% of land value) for easementary rights.

Aggrieved, the claimant sought enhanced compensation before the Arbitrator.

The Arbitrator enhanced the compensation to Rs. 1190/- per Sq. Mtr. for land, directed 10% of this enhanced land compensation for easementary rights, awarded Rs. 1,10,000/- for loss of business, and 9% interest on enhanced compensation.

Both the claimant and NHAI challenged this arbitral award under Section 34 of the Arbitration and Conciliation Act, 1996, before the District Court, which dismissed both applications via a common judgment and order dated 13.04.2016.

These present appeals, filed under Section 37 of the Act, challenge that common judgment.

Whether the Arbitrator's enhancement of land price from Rs. 595/- to Rs. 1190/- per Sq. Mtr. was without evidence or reason.

Whether the award of 10% for loss of earning was erroneous without production of account statements of prior and later income.

Whether the separate award of 10% for easementary rights was erroneous, given that ownership of the land was acquired.

Whether the compensation granted by the arbitrator was inadequate, as the land was already used for commercial purposes despite being treated as N.A. potential.

Whether the appeals under Section 37 warrant interference with the arbitral award based on the grounds of public policy or patent illegality.

The court primarily applied Section 37 of the Arbitration and Conciliation Act, 1996, governing appeals from orders under Section 34.

It also referenced Section 34, which outlines the limited grounds for setting aside an arbitral award, including conflict with public policy of India, or patent illegality appearing on the face of the award.

The court relied on precedents from the Supreme Court, specifically *PSA Sical Terminals Private Limited Vs. Board of Trustees of V.O. Chidambaranar Port Trust Tuticorn and Anr.* (2023) 15 SCC 781, for the limited scope of judicial interference under Section 34 and 37, explicitly stating that courts should not act as appellate bodies to reappreciate evidence and that interference is warranted only when an award shocks the conscience or involves patent illegality rooted in the matter, not merely an erroneous application of law or reappreciation of evidence.

It further cited *MMTC Limited Vs. Vendanta Limited* (2019) 4 SCC 163, emphasizing that Section 37 cannot travel beyond Section 34 restrictions and that concurrent findings should be disturbed only with extreme caution.

The court also referred to *Union of India & Anr. Vs. Tarsem Singh & Ors.* 2019 AIR (SC) 4689, which clarified that easementary rights are subsumed in ownership rights during acquisition but recognized compensation for rights of user for persons other than the owner.

The court, guiding itself by the limited scope of review under Sections 34 and 37 of the Arbitration and Conciliation Act, emphasized that it cannot re-evaluate the merits of the arbitral award.

It acknowledged that the acquired land was already in commercial use (petrol pump), and the Arbitrator's enhancement of compensation from Rs. 595/- to Rs. 1190/- per Sq. Mtr. was based on this commercial nature, correcting the competent authority's assessment of N.A. potential.

The court found the 10% loss of income and easementary rights, as fixed by both the competent authority and the Arbitrator, to be reasonable and based on record, especially since the NHAI never challenged the initial 10% award for business loss.

Regarding the easementary rights, while *Tarsem Singh* (supra) stated such rights are subsumed in ownership, the court distinguished that here, only the frontal part of the claimant's land was acquired, and the remaining petrol pump business continued, suffering a loss of easementary right due to the impact of highway expansion (e.g., divider).

Therefore, awarding 10% for loss of easementary right for the remaining land was deemed not to travel beyond the law established in *Tarsem Singh*.

The court rejected the claimant's reliance on a sale instance from Taluka Bhusawal for higher compensation, noting it was from a developed municipal area, unlike the rural acquired land.

The court found no patent illegality or violation of public policy warranting interference with the Arbitrator's decision on compensation for land, business loss, or easementary rights.

Arbitration Appeal No. 4/2024 filed by the claimant was disposed of with directions.

The court held that the Arbitrator's decisions on enhancing land compensation, loss of profit, and easementary rights were reasonable and did not constitute patent illegality or conflict with public policy.

However, it directed the Arbitrator to compute statutory benefits, including solatium, as per the *Tarsem Singh* judgment, after hearing the parties, within four months.