# N.H.A.I v. Parimal Bajpai & Ors

- **Citation:** (2023) 12 ILRA 45
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-11-17
- **Case number:** Act 1996 No. 901 of 2023
- **Bench:** Ajay Bhanot
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/n-h-a-i-v-parimal-bajpai-ors-49603
- **Pages:** 5

## Headnote

National Highways Authority of India Act,
1988 - Section 3-G(5) - Arbitration and
Conciliation Act, 1996 - Section 34(4) -
Arbitral award - Challenge - Application
for setting aside arbitral award - Section
34(4) of the Arbitration and Conciliation
Act,
1996
contemplates
a
second
opportunity to the arbitral tribunal to
revive arbitration proceedings to cure the
defects in the award. The prerequisites of
exercise of powers u/s 34(4) are twofold:
(i) the Court in proceedings u/s 34 has to
46 INDIAN LAW REPORTS ALLAHABAD SERIES
come to a conclusion that it is appropriate
to give the arbitral tribunal an opportunity
to resume arbitral proceedings or to take
such other action as will eliminate the
grounds for setting aside the arbitral
award, which requires application of mind
to the grounds taken by the parties in
their
Section
34
application
and
examination of the material evidence on
record; and (ii) there should be a request
by a party, which can be gleaned out from
the grounds taken in the application under
Section 34. In the instant case, the
competent
authority
determined
compensation; objections were filed both
by the appellant/NHAI as well as the
claimants before the Arbitrator - Arbitral
Tribunal while drawing its award failed to
consider
the
objections
of
the
appellant/NHAI
and
based
its
determination
solely
on
respondents'
objections - In application u/s 34 of the
Act appellant/NHAI explicitly pleaded the
deficiencies in the award however the
Court below failed to advert to those
grounds Held : Additional District Judge
misdirected itself in fact and law in
declining to remit; Court remitted the
matter
to
the
Arbitrator
to
resume
proceedings and to determine appellants'
objections on merits. (Para 10 - 18)

Allowed. (E-5)

## Text

12 All. N.H.A.I. Vs. Parimal Bajpai & Ors.
45

17. The applicant/appellant has
averred that his counsel has advised that
the period of limitation for filing an
appeal against the order passed under the
Act of 1996 is 90 days as it was earlier
held by the Hon'ble Apex Court in N.V.
International Vs. State of Aassam &
Anr reported in (2020)2 SCC 109, the
applicant's counsel had no knowledge
that
the
aforesaid
case
has
been
overruled by Hon'ble Apex Court vide
its judgment and order passed in Borse
Brothers (supra).

18. The delay caused in filing the
appeal is due to wrong advice give by the
applicant's counsel regarding period of
limitation for filing the appeal. Thus, there
was no negligence on the part of the
applicant in filing the appeal after a lapse
of 29 days of the limitation period, the
delay was caused due to wrong advice
given by his counsel about the limitation
period in filing the appeal against the
impugned order.

19. In the case of Oil and Natural
Gas Commission Vs. Tridib Nath Sanyal
& Ors. AIR 1983 Cal 124; the Culcutta
High Court has held that;

"A
litigant
would
not
be
responsible for negligence of his counsel
unless there has been some remissness on
the part of the litigant."

20. Apart from this, considering the
facts and circumstances of the case and
period of delay in filing the appeal, we are
of the considered view that there is
sufficient cause that the delay in filing
appeal should be condoned under Section 5
of
the
Limitation
Act.
The
applicant/appellant is granted benefit of
Section 5 of the Limitation Act and the
delay of 29 days in filing the appeal is
condoned accordingly.

21. The delay condonation application
is allowed accordingly.

22. Office to allot regular number to
the appeal, if there is no other legal
impediment.

23. Put up as fresh on 21st December,
2023 for admission of appeal.
----------
(2023) 12 ILRA 45
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 17.11.2023

BEFORE

THE HON'BLE AJAY BHANOT, J.

Appeal U/S 37 OF Arbitration And Conciliation
Act 1996 No. 901 of 2023

N.H.A.I. ...Appellant
Versus
Parimal Bajpai & Ors. ...Respondents

Counsel for the Appellant:
Sri Aloke Kumar

Counsel for the Respondents:
Sri Suresh Chandra Verma, Sri Saumitra
Dwivedi, Sri Shashank Shekhar Mishra, Sri
Devesh Kumar Verma

National Highways Authority of India Act,
1988 - Section 3-G(5) - Arbitration and
Conciliation Act, 1996 - Section 34(4) -
Arbitral award - Challenge - Application
for setting aside arbitral award - Section
34(4) of the Arbitration and Conciliation
Act,
1996
contemplates
a
second
opportunity to the arbitral tribunal to
revive arbitration proceedings to cure the
defects in the award. The prerequisites of
exercise of powers u/s 34(4) are twofold:
(i) the Court in proceedings u/s 34 has to
46 INDIAN LAW REPORTS ALLAHABAD SERIES
come to a conclusion that it is appropriate
to give the arbitral tribunal an opportunity
to resume arbitral proceedings or to take
such other action as will eliminate the
grounds for setting aside the arbitral
award, which requires application of mind
to the grounds taken by the parties in
their
Section
34
application
and
examination of the material evidence on
record; and (ii) there should be a request
by a party, which can be gleaned out from
the grounds taken in the application under
Section 34. In the instant case, the
competent
authority
determined
compensation; objections were filed both
by the appellant/NHAI as well as the
claimants before the Arbitrator - Arbitral
Tribunal while drawing its award failed to
consider
the
objections
of
the
appellant/NHAI
and
based
its
determination
solely
on
respondents'
objections - In application u/s 34 of the
Act appellant/NHAI explicitly pleaded the
deficiencies in the award however the
Court below failed to advert to those
grounds Held : Additional District Judge
misdirected itself in fact and law in
declining to remit; Court remitted the
matter
to
the
Arbitrator
to
resume
proceedings and to determine appellants'
objections on merits. (Para 10 - 18)

Allowed. (E-5)

(Delivered by Hon'ble Ajay Bhanot, J.)

1. The competent authority under
Section 3-G of the National Highway
Authority of India Act, 1988 determined the
compensation amount liable to be paid to the
claimants by award dated 27.08.2020. The
Arbitral Tribunal was constituted under
Section 3-G(5) of the National Highway
Authority of India Act, 1988. The appellant
before this Court as well as the respondentclaimant preferred objections against the said
award before the Arbitrator. The Arbitral
Tribunal while drawing its award neglected
to consider the objections raised by the
appellant and made the final determination
solely on the footing of the objections
tendered by the respondents-claimants.

2. Thus, aggrieved, the appellants took
out proceedings under Section 34 of the
Arbitration
and
Conciliation
Act,
1996(hereinafter referred to as 'the Act')
before the learned District Judge which came
to be registered as Arbitration Case No. 17 of
2022 (National Highway Authority of India
vs. Parimal Bajpai and Others).

3. In the aforesaid proceedings, the case
of the appellants before the Court below was
that the challenge to the compensation
determined by the competent authority was
specifically made by the NHAI before the
Arbitrator. The Arbitrator failed to make any
finding on the objections raised by the
appellants/ petitioners and the arbitral award
dated 27.08.2020 was passed while the said
application remained pending in Case No.
C202103000000613.

4. A ground in regard to the aforesaid
illegality which vitiates the arbitral award
was taken in the proceedings under Section
34 of the Act registered as Arbitration Case
No. 17 of 2022 (National Highway Authority
of India vs. Parimal Bajpai and Others)
before the learned court below. The relevant
pleadings are extracted hereunder:

"It is pertinent to mention that
NHAI had challenged the award dated
27.08.2020 in C202103000000613 before
Ld. Arbitrator wherein respondent is also a
party, however, Ld. Arbitrator wherein
respondent is also a party, however, Ld.
Arbitrator has not decided the aforesaid
case and same is still pending."

5. The learned court below did not
advert to the said grounds and no finding in
this regard was made in the impugned order
12 All. N.H.A.I. Vs. Parimal Bajpai & Ors.
47
dated 27.08.2020 rendered by the court
below while deciding the said Arbitration
Case No. 17 of 2022 (National Highway
Authority of India vs. Parimal Bajpai and
Others). These are the undisputed facts of
the case.

6. Shri Aloke Kumar, learned counsel
for the appellants submits that the failure of
the court below to decide the said
categorical
objections
taken
in
the
proceedings under Section 34 of the Act
perpetuates the error of the arbitral tribunal.
And as a consequence thereof, an award
which is contrary to the fundamental policy
of Indian law and also in conflict to the
basic notions of morality and justice is
sought
to
be
executed
against
the
appellants.

7. Per contra, Shri Shashank Shekhar
Mishra, learned counsel assisted by Shri
Devesh Kumar Verma, learned counsel on
behalf of the respondents contends that the
prerequisites for exercise of powers under
Section 34 of the Act are not satisfied in as
much as no request under Section 34(4) of
the Arbitration and Conciliation Act, 1996
was made before the court below to adjourn
the proceedings to give the Arbitral
Tribunal an opportunity to resume the
arbitral proceedings and cure the errors.

8. Heard learned counsels for the
parties. At the outset, it would be apposite
to reproduce Section 34 of the Act,
interpretation of which will govern the fate
of the controversy.

"Section
34.
Application
for
setting aside arbitral award. -

(1). Recourse to a Court against
an arbitral award may be made only by an
application for setting aside such award in
accordance with sub-section (2) and subsection (3).

(2). An arbitral award may be set
aside by the Court only if-

(a)
the
party
making
the
application 1[establishes on the basis of the
record of the arbitral tribunal that]-

(i) a party was under some
incapacity, or

(ii) the arbitration agreement is
not valid under the law to which the parties
have subjected it or, failing any indication
thereon, under the law for the time being in
force; or

(iii)
the
party
making
the
application was not given proper notice of
the appointment of an arbitrator or of the
arbitral proceedings or was otherwise
unable to present his case; or

(iv) the arbitral award deals with
a dispute not contemplated by or not falling
within the terms of the submission to
arbitration, or it contains decisions on
matters beyond the scope of the submission
to arbitration:

Provided that, if the decisions on
matters submitted to arbitration can be
separated from those not so submitted, only
that part of the arbitral award which
contains decisions on matters not submitted
to arbitration may be set aside; or

(v) the composition of the arbitral
tribunal or the arbitral procedure was not in
accordance with the agreement of the
parties, unless such agreement was in
conflict with a provision of this Part from
which the parties cannot derogate, or,
failing such agreement, was not in
accordance with this Part; or

(b) the Court finds that-

(i) the subject-matter of the
dispute is not capable of settlement by
arbitration under the law for the time being
in force, or
48 INDIAN LAW REPORTS ALLAHABAD SERIES

(ii) the arbitral award is in
conflict with the public policy of India.

Explanation. ?Without prejudice
to the generality of sub-clause (ii) it is
hereby declared, for the avoidance of any
doubt, that an award is in conflict with the
public policy of India if the making of the
award was induced or affected by fraud or
corruption or was in violation of section 75
or section 81.

(3). An application for setting
aside may not be made after three months
have elapsed from the date on which the
party making that application had received
the arbitral award or, if a request had been
made under section 33, from the date on
which that request had been disposed of by
the arbitral tribunal: Provided that if the
Court is satisfied that the applicant was
prevented by sufficient cause from making
the application within the said period of
three
months
it
may
entertain
the
application within a further period of thirty
days, but not thereafter.

(4). On receipt of an application
under sub-section (1), the Court may,
where it is appropriate and it is so
requested
by
a
party,
adjourn
the
proceedings
for
a
period
of
time
determined by it in order to give the arbitral
tribunal an opportunity to resume the
arbitral proceedings or to take such other
action as in the opinion of arbitral tribunal
will eliminate the grounds for setting aside
the arbitral award."

9. Section 34(4) of the Arbitration and
Conciliation Act, 1996 contemplates a
second opportunity to the arbitral tribunal
to revive arbitration proceedings to cure the
defects in the award.

10. The prerequisites of exercise of
powers under Section 34(4) of the Act are
two fold. Firstly, the learned court in
proceedings under Section 34 of the Act
has come to a conclusion that it is
appropriate to give the arbitral tribunal an
opportunity to resume arbitral proceedings
or to take such other action as in the
opinion of the arbitrator will eliminate the
grounds for setting aside the arbitral award.
This precondition requires the court to
apply its mind to the grounds taken by the
parties in their application for setting aside
an arbitral award and also to examine the
other material evidences in the record.

11. The second condition precedent
for exercise of powers under Section 34(4)
of the Act is that the party should make a
request for giving the arbitral tribunal such
an opportunity. The legislative intent of
Section 34(4) of the Act can be determined
from the words used in the provision. The
legislature has not used legalese or formal
legal terms, but the provision is in a less
formal cast. The phrase "so requested by a
party" stands in contradistinction to "a
formal prayer made by the party" or "a
specific relief sought by the party". The
request by a party as contemplated in
Section 34(4) of the Act can be gleaned out
from the grounds in the application under
Section 34 of the Act. The pleadings as
regards the deficiencies in the award have
been explicitly made in the application
under Section 34 of the Arbitration Act. In
these circumstances, it is safe for the court
below to accept the same as a request by
the party contemplated under Section 34(4)
of the Act.

12. In the facts of this case, there is
no difficulty in concluding that the said
prerequisite for exercise of powers under
34(4) of the Act was duly satisfied as the
appellants have taken specific grounds
as regards the errors in the arbitral
award.
12 All. Vinay Jaiswal Vs. State of U.P. & Anr.
49

13. The court below neglected to make
any finding in regard to the objections to the
arbitral award, while passing the impugned
order. The impugned order is vitiated by non
application of mind.

14. In these facts, the prerequisites for
exercising powers under Section 34 of the Act
are fully satisfied. Learned court below
misdirected itself in fact and law by declining
to give the arbitral tribunal an opportunity to
resume the arbitral proceedings and cure the
aforesaid defects.

15. The question now arises as to
whether the matter should be remitted to the
court below for resuming proceedings under
Section 34 of the Act or to the arbitral tribunal
for resuming arbitral proceedings.

16. In light of the provisions of Section 34
of Arbitration and Conciliation Act, 1996 and the
appellate powers of this Court, interest of justice
which are consistent with the provisions of law
will be served by remitting the matter to the
Arbitral Tribunal. The narrative will be fortified
by authorities in point. The Supreme Court in
National Highways Authority of India Vs. P.
Nagaraju and Ors. reported at 2022 SCC
OnLine SC 864 while examining the course of
action before the appellate court while dealing
with the infirmities in an arbitral award has held:

"That being the fact situation and
also the position of law being clear that it
would not be open for the court in the
proceedings under Section 34 or in the appeal
under Section 37 to modify the award, the
appropriate course to be adopted in such event
is to set aside the award and remit the matter to
the learned Arbitrator in terms of Section
34(4) to keep in view these aspects of the
matter and even if the notification dated
28.03.2016 relied upon is justified since we
have indicated that the same could be relied
upon, the further aspects with regard to the
appropriate market value fixed under the said
notification for the lands which is the subject
matter of the acquisition or comparable lands
is to be made based on appropriate evidence
available before it and on assigning reasons for
the conclusion to be reached by the learned
Arbitrator. In that regard, all contentions of the
parties are left open to be put forth before the
learned Arbitrator."

17. The impugned order dated 21.08.2023
passed by learned Additional District Judge,
Kanpur Nagar in Arbitration Case No. 17 of
2022 (National Highway Authority of India vs.
Parimal Bajpai and Others) is liable to be set
aside and is set aside.

18. The matter is remitted to the
Arbitrator to resume proceedings in Case
No. C202103000000613 and to determine
the objections raised by the appellant on
merits. The proceeding shall be completed
within a period of two months. The
Arbitrator shall decide the objections made
by the appellants against the award by the
competent authority in accordance with law
and after giving an opportunity of hearing to
both the parties.

19. The appeal is accordingly allowed.
----------
(2023) 12 ILRA 49
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 26.10.2023

BEFORE

THE HON'BLE NALIN KUMAR SRIVASTAVA, J.

Crl. Misc. Anticipatory Bail Cancellation
Application No. 390 of 2023

Vinay Jaiswal ...Applicant
Versus
State of U.P. & Anr. ...Opp. Parties