Arbitrator Appointed Under National Highway Act Can Determine Market Value Of Property For Recalculation Of Compensation Awarded By Competent Authority: Kerala HC
The Kerala High Court observed that an arbitrator appointed under the National Highway Act can determine the market value of a property for recalculation of compensation awarded by a competent authority.
The Court upheld the Punarnava Ayurveda Hospital Pvt. Ltd’s (petitioner's) challenge against the Competent Authority for Land Acquisition (CALA) by ordering reconsideration of an application for the appointment of an expert commissioner for the calculation of the true market value of a property.
The Bench referred to the decision in Unnikrishnan v. Arbitrator (District Collector) Collectorate, Thrissur (2023 (4) KHC 521), where the Kerala High Court discussed the role of the Arbitrator as a fact-finding authority akin to an arbitrator under the Arbitration and Conciliation Act, 1996. The judgment explained that under Section 3G of the National Highway Act, 1956 (the Act) if the amount fixed by the competent authority was not acceptable to either party, the said amount could be decided by an arbitrator appointed by the Central Government by filing an application.
A Single Bench of Justice Viju Abraham observed, “Since the property of the petitioner under acquisition is a dry land having commercial importance and situated adjoining to NH 66 on its eastern side as per the guidelines issued the property should have been considered as one falling under Category-I, but CALA included the property under Category-VI by mistake and without taking into account the guidelines issued in this regard.”
Advocate M.K. Sumod represented the appellant.
After the petitioner's property was acquired for the widening of the National Highway through an award, they submitted a petition invoking Section 3G of the Act. Despite being a dry land with commercial importance and located adjacent to the National Highway, the petitioner's property was categorised under Category VI in the award, prompting the contention that it should have been classified under Category I.
The petitioner had filed an application for the appointment of an arbitrator/expert commissioner under Section 26 of the Arbitration and Conciliation Act, 1996.
The Special Deputy Collector had rejected the petitioner’s request for a report of the expert to decide the true market value of the property acquired. Category-I included dry land having commercial importance adjacent to the National Highway and Category-VI were dry lands having Corporation road facility.
Earlier, a Division Bench of the High Court had directed an arbitrator to decide the true market value of the property acquired. Inspite of this specific direction, the arbitrator rejected the request of the petitioner solely for the reason that CALA had filed an objection.
The Court held that the petitioner, dissatisfied with the categorization of their property by the Competent Authority for Land Acquisition (CALA), had the right to challenge it. They could request the appointment of an Expert Commissioner to ascertain the actual value of the property.
Accordingly, the High Court disposed of the petition.
Cause Title: M/S Punarnava Ayurveda Hospital Pvt. Ltd v. The Arbitrator For NH & Ors. (Neutral Citation: 2024:KER:31690)
Appearance:
Appellant: Advocates M.K. Sumod, Vidya M.K., Raj Carolin V. and Thushara.K