# Smt. Tulsarani & Anr v. Union of India & Ors

- **Citation:** (2022) 11 ILRA 295
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-09-26
- **Case number:** Matter under Article 227 No. 56 of 2022
- **Bench:** J.J. Munir
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/smt-tulsarani-anr-v-union-of-india-ors-47815
- **Pages:** 7

## Headnote

A. Civil Law - National Highways Act,
1956-Section
3G(5)-Arbitration
and
Conciliation
Act,
1996-Section
34Commercial
Courts
Act,
2015-Section
2(1)(c)-Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation
and
Resettlement
Act,
2013-Section
113(1)
and
67Compensation-Petitioner's land has been
acquired
for
purpose
of
a
National
Highway-petitioner
challenged
the
Statutory
award
for
seeking
enhancement-property belonging to the
petitioner
was
compulsorily
acquired
under the provisions of the Act, 1956,
therefore it is by no means a 'commercial
dispute' within the meaning of section
2(1)(c) of the Commercial Courts Act,
2015- Thus, the Application u/s 34 of Act
of 1996 would not be maintainable before
Commercial Court.(Para 1 to 20)

The writ petition is dismissed. (E-6)

List of Cases cited:

## Text

11 All. Smt. Tulsarani & Anr. Vs. Union of India & Ors.
295

25. It is open to the plaintiff/
respondent to file suit for the relief
claimed, if so, advised, before the revenue
court.
----------
(2022) 11 ILRA 295
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 26.09.2022

BEFORE

THE HON'BLE J.J. MUNIR, J.

Matter under Article 227 No. 56 of 2022

Smt. Tulsarani & Anr. ...Petitioners
Versus
Union of India & Ors. ...Respondents

Counsel for the Petitioner:
Sri Nand Kishor Mishra, Shilpa Ahuja

Counsel for the Respondents:
A.S.G.I., C.S.C., Sri Jai Krishna Narain Sharma,
Sri Pranjal Mehrotra

A. Civil Law - National Highways Act,
1956-Section
3G(5)-Arbitration
and
Conciliation
Act,
1996-Section
34Commercial
Courts
Act,
2015-Section
2(1)(c)-Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation
and
Resettlement
Act,
2013-Section
113(1)
and
67Compensation-Petitioner's land has been
acquired
for
purpose
of
a
National
Highway-petitioner
challenged
the
Statutory
award
for
seeking
enhancement-property belonging to the
petitioner
was
compulsorily
acquired
under the provisions of the Act, 1956,
therefore it is by no means a 'commercial
dispute' within the meaning of section
2(1)(c) of the Commercial Courts Act,
2015- Thus, the Application u/s 34 of Act
of 1996 would not be maintainable before
Commercial Court.(Para 1 to 20)

The writ petition is dismissed. (E-6)

List of Cases cited:
1. UOI & anr. Vs Tarsem Singh & ors. (2019) 9
SCC 304

2. Richa Bisht Vs UOI (2020) AIR Online UTR
478

(Delivered by Hon'ble J.J. Munir, J.)

1. This petition under Article 227 of
the Constitution is directed against an order
of the Presiding Officer, Commercial
Court, Jhansi dated 28.09.2021, to the
extent it directs return of Arbitration Misc.
Case No. 52 of 2021 and Arbitration Misc.
Case No. 2 of 2021, under Section 34 of the
Arbitration and Conciliation Act, 1996, for
presentation to the proper Court.

2. It is common ground between
parties that the petitioners' land comprised
in a part of Arazi No. 73 of Village
Raimalpura,
Tehsil
Kulpahar,
District
Mahoba, was acquired by the Central
Government for widening of National
Highway No. 76 from 89.600 kms. to
133.520 kms. The petitioners' land in Arazi
No. 73 aforesaid, which shall hereinafter be
called ''the land in question' was acquired
through a Notification No. 2345 dated
18.08.2017, issued and published by the
Central Government under Section 3(2) of
the National Highways Act, 1956 (for
short, ''the Act of 1956'). The notification
last
mentioned
was
followed
by
Notification No. 3378 dated 08.12.2017,
published in the Gazette Extraordinary
dated 08.12.2017 of the Government of
India. Under the said notifications, a total
0.7507 hectare of land was acquired in
Village Raimalpura, out of which 0.6587
hectare was found to be agricultural land,
while the balance 0.0920 hectare was
determined as State land. The land in
296 INDIAN LAW REPORTS ALLAHABAD SERIES
question is part of the aforesaid total area
of land acquired in Village Raimalpura.

3. A notification was published in two
local newspapers i.e. Dainik Jagran and
Times of India dated 22.12.2017, asking
persons affected to produce their claims for
compensation under Section 3G of the Act
of 1956. The first petitioner laid claim to
the land in question supported by necessary
evidence before the Competent Authority
under
Section
3G.
The
Competent
Authority/
Special
Land
Acquisition
Officer, Banda passed an award dated
07.07.2018, assessing compensation for the
entire land acquired in Village Raimalpura,
including the land in question, on the basis
that it is agricultural land. Compensation
was determined, treating the land to be
agricultural.

4. The petitioners, aggrieved by the
award passed by the Competent Authority
dated 07.07.2018, moved the Statutory
Arbitrator,
appointed
by
the
Central
Government under Section 3G(5) of the
Act of 1956, seeking enhancement of the
compensation
awarded.
The
Statutory
Arbitrator, appointed in terms of a
notification dated 30.07.2020 issued by the
Government of India for acquisitions made
in District Mahoba, was notified to be the
District Magistrate, Mahoba. The Statutory
Arbitrator dealt with all objections relating
to the entire land in Village Raimalpura,
admeasuring 0.6587 hectare, that was
found to be bhumidhari.

5. The petitioners' case relating to a
higher rate compensation for the land in
question was also dealt with together with
those of others, who had approached the
Statutory
Arbitrator.
The
Statutory
Arbitrator did not accept the petitioners'
contention, as he did not for other land
similarly situate that the land in question
was residential in character and ought to be
compensated
for
its
acquisition
at
residential rates. It was held to be
agricultural.
In
agreement
with
the
Competent
Authority,
the
Statutory
Arbitrator/ District Magistrate, Mahoba
upheld the Competent Authority's award
dated 07.07.2018 by his arbitral award
dated 10.12.2020 passed in Case No. 00333
of 2020.

6. The petitioners, like others,
aggrieved by the Statutory Arbitrator's
award, moved the Commercial Court,
Jhansi under Section 34 of the Arbitration
and Conciliation Act, 1996 (for short, ''the
Act of 1996') with a prayer to set aside the
Statutory Arbitrator's award.

7. All the applications by landholders
of acquired land in Village Raimalpura,
who were aggrieved by the Statutory
Arbitrator's award dated 10.12.2020, were
consolidated and heard together with
Arbitration Misc. Case No. 51 of 2021
being treated as the leading case. The
petitioners' cases are Arbitration Misc.
Case Nos. 52 of 2021 and 2 of 2021.

8. The Commercial Court, Jhansi held
that the Statutory Arbitrator's award could
not be questioned under Section 34 of the
Act of 1996 and the petitioners' remedy
was to seek a reference under Section 67 of
the Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement Act, 2013
(for short, ''the Act of 2013') to the Land
Acquisition
and
Rehabilitation
and
Resettlement Authority, constituted under
Section 51 of the Act of 2013. Accordingly,
the Presiding Officer, Commercial Court,
Jhansi directed return of the applications
under Section 34 of the Act of 1996 under
11 All. Smt. Tulsarani & Anr. Vs. Union of India & Ors.
297
Order VII Rule 10 CPC for presentation to
the proper Court. It was further directed
that in case steps were not taken to take
back the applications, the applications
would stand rejected under Order VII Rule
11 (d) CPC.

9. It is this order of the Presiding
Officer, Commercial Court, Jhansi that the
petitioners have impugned in the present
petition.

10. Heard Mr. Nand Kishor Mishra,
learned Counsel for the petitioners, Mr.
Pranjal
Mehrotra,
learned
Counsel
appearing on behalf National Highway
Authority of India, respondent no.5, Mr. Jai
Krishna Narain Sharma, learned Central
Government Counsel appearing on behalf
of the Union of India and Mr. Sanjay
Kumar Singh, learned Additional Chief
Standing Counsel for respondent nos.2, 3
and 4.

11. The moot point involved in this
case is whether the award of the Statutory
Arbitrator passed under Section 3G(5) of
the Act of 1956 can be questioned through
an application under Section 34 of the Act
of 1996? If yes, before which Court or
Tribunal?

12. The provisions of Section 3G of
the Act of 1956 read:

3G.
Determination
of
amount
payable as compensation.-(1) Where any
land is acquired under this Act, there shall
be paid an amount which shall be
determined by an order of the competent
authority.

(2) Where the right of user or any right
in the nature of an easement on, any land is
acquired under this Act, there shall be paid
an amount to the owner and any other
person whose right of enjoyment in that
land has been affected in any manner
whatsoever by reason of such acquisition
an amount calculated at ten per cent, of the
amount determined under sub-section (1),
for that land.

(3) Before proceeding to determine the
amount under sub-section (1) or subsection (2), the competent authority shall
give a public notice published in two local
newspapers, one of which will be in a
vernacular language inviting claims from
all persons interested in the land to be
acquired.

(4) Such notice shall state the
particulars of the land and shall require all
persons interested in such land to appear in
person or by an agent or by a legal
practitioner referred to in sub-section (2) of
section 3C, before the competent authority,
at a time and place and to state the nature
of their respective interest in such land.

(5) If the amount determined by the
competent authority under sub-section (1)
or sub-section (2) is not acceptable to either
of the parties, the amount shall, on an
application by either of the parties, be
determined
by
the
arbitrator
to
be
appointed by the Central Government.

(6) Subject to the provisions of this
Act, the provisions of the Arbitration and
Conciliation Act, 1996 (26 of 1996) shall
apply to every arbitration under this Act.

(7) The competent authority or the
arbitrator while determining the amount
under sub-section (1) or sub-section (5), as
the
case
may
be,
shall
take
into
consideration-

(a) the market value of the land on the
date of publication of the notification under
section 3A;

(b) the damage, if any, sustained by
the person interested at the time of taking
possession of the land, by reason of the
severing of such land from other land;
298 INDIAN LAW REPORTS ALLAHABAD SERIES

(c) the damage, if any, sustained by
the person interested at the time of taking
possession of the land, by reason of the
acquisition injuriously affecting his other
immovable property in any manner, or his
earnings;

(d)
if,
in
consequences
of
the
acquisition
of
the
land,
the
person
interested is compelled to change his
residence or place of business, the
reasonable expenses, if any, incidental to
such change.

13. Upon hearing the learned Counsel
for parties and perusing the impugned
judgment, this Court finds that the
Presiding Officer, Commercial Court may
not be wrong in saying that he does not
have the jurisdiction to entertain the
application under Section 34 of the Act of
1996, but he is certainly wrong in thinking
that the award of the Statutory Arbitrator
under Section 3G(5) of the Act of 1956
cannot be challenged by an application
under Section 34 of the Act,
last
mentioned. Sub-Section (6) of Section 3G
clearly mentions that subject to the
provisions of the Act of 1956, the
provisions of the Act of 1996 shall apply to
every arbitration under the former Act.
There is nothing in the scheme of Section
3G of the Act of 1956 to exclude the
application of Section 34 vis-à-vis the
award of the Statutory Arbitrator, passed
under Section 3G(5) of the Act of 1956. An
award by the Statutory Arbitrator may be
questioned before the Court of competent
jurisdiction under Section 34 of the Act of
1996, like any other award by an
Arbitrator.

14. This Court is of opinion that the
Commercial Court was misled by the
application of the provisions of the Act of
2013
relating
to
determination
of
compensation in accordance with the First
Schedule, rehabilitation and resettlement in
accordance with the Second Schedule and
infrastructure amenities in accordance with
the Third Schedule to acquisitions made
under the Act of 1956, by including it in
the Fourth Schedule to the Act of 2013.
The said provisions of the Act of 2013 have
been made applicable to acquisitions under
the Act of 1956 by the Central Government
issuing an order in exercise of powers
under sub-Section (1) of Section 113 of the
Act of 2013.

15. The provisions of the Act of 2013
have been made applicable to acquisitions
under the Act of 1956 for the limited
purpose of calculation of compensation and
entitlement to solatium, interest etc. in
order to place land oustees under both the
statutes at par. It is not that the entire
procedure,
including
remedies
for
determination and assailing the quantum of
compensation awarded under the Act of
1956, have been subsumed by the Act of
2013 by the limited extension of certain
benefits under the Act of 2013 to
acquisitions made under the Act of 1956.
The provisions of reference to the Land
Acquisition,
Rehabilitation
and
Resettlement Authority under the Act of
2013
for
the
purpose
of
seeking
enhancement of compensation awarded
available to a land oustee, would not be
available to a land oustee, whose land is
acquired under the Act of 1956. His
remedies are confined to the four corners of
Section 3G of the Act of 1956.

16. This is the clear import of the
holding of their Lordships of the Supreme
Court, to the understanding of this Court, in
Union of India and another v. Tarsem
Singh and others, (2019) 9 SCC 304. In
Tarsem Singh (supra), it has been held:
11 All. Smt. Tulsarani & Anr. Vs. Union of India & Ors.
299

13. The First Schedule to the said Act
provides that solatium equivalent to 100%
of the market value multiplied by various
factors, depending on whether the land is
situated in a rural or urban area, constitutes
minimum compensation package to be
given to those whose land is acquired. The
Fourth Schedule to this Act, to be read
along with Section 105, expressly includes
under Item 7, the National Highways Act,
1956. In Item 9, this Schedule also includes
the Requisitioning and Acquisition of
Immovable Property Act, 1952. By a
Notification dated 28-8-2015 issued under
Section 105 read with Section 113 of the
2013 Act, it is provided that the 2013 Act
compensation provisions will apply to
acquisitions that take place under the
National Highways Act. The result is that
both before the 1997 Amendment Act and
after the coming into force of the 2013 Act,
solatium
and
interest
is
payable
to
landowners whose property is compulsorily
acquired
for
purposes
of
National
Highways. This is one other very important
circumstance to be borne in mind when
judging the constitutional validity of the
1997 Amendment Act for the interregnum
period from 1997 to 2015.

48. It is thus clear that the
Ordinance as well as the notification have
applied the principle contained in Nagpur
Improvement Trust [Nagpur Improvement
Trust v. Vithal Rao, (1973) 1 SCC 500] , as
the Central Government has considered it
necessary to extend the benefits available to
landowners generally under the 2013 Act to
similarly placed landowners whose lands are
acquired under the 13 enactments specified in
the Fourth Schedule, the National Highways
Act being one of the aforesaid enactments.
This being the case, it is clear that the
Government has itself accepted that the
principle of Nagpur Improvement Trust
[Nagpur Improvement Trust v. Vithal Rao,
(1973) 1 SCC 500] would apply to
acquisitions which take place under the
National Highways Act, and that solatium
and interest would be payable under the 2013
Act to persons whose lands are acquired for
the purpose of National Highways as they are
similarly placed to those landowners whose
lands have been acquired for other public
purposes under the 2013 Act. This being the
case, it is clear that even the Government is
of the view that it is not possible to
discriminate between landowners covered by
the 2013 Act and landowners covered by the
National Highways Act, when it comes to
compensation to be paid for lands acquired
under
either
of
the
enactments.
The
judgments delivered under the 1952 Act as
well as the Defence of India Act, 1971, may,
therefore, require a re-look in the light of this
development. [ The Defence of India Act,
1971, was a temporary statute which
remained in force only during the period of
operation of a proclamation of emergency
and for a period of six months thereafter --
vide Section 1(3) of the Act. As this Act has
since expired, it is not included in the Fourth
Schedule of the 2013 Act.] In any case, as has
been pointed out hereinabove, Chajju Ram
[Union of India v. Chajju Ram, (2003) 5 SCC
568] , has been referred to a larger Bench. In
this view of the matter, we are of the view
that the view of the Punjab and Haryana High
Court [Union of India v. Tarsem Singh, 2018
SCC OnLine P&H 6036] , [Jang Bahadur v.
Union of India, 2018 SCC OnLine P&H
6034] , [Union of India v. Abhinav Cotspin
Ltd., 2016 SCC OnLine P&H 19319] is
correct, whereas the view of the Rajasthan
High Court [Banshilal Samariya v. Union of
India, 2005 SCC OnLine Raj 572 : 2005-06
Supp RLW 559] is not correct.

52. There is no doubt that the learned
Solicitor General, in the aforesaid two
orders, has conceded the issue raised in
these cases. This assumes importance in
300 INDIAN LAW REPORTS ALLAHABAD SERIES
view of the plea of Shri Divan that the
impugned judgments should be set aside on
the ground that when the arbitral awards
did not provide for solatium or interest, no
Section 34 petition having been filed by the
landowners on this score, the Division
Bench judgments that are impugned before
us ought not to have allowed solatium
and/or interest. Ordinarily, we would have
acceded to this plea, but given the fact that
the Government itself is of the view that
solatium and interest should be granted
even in cases that arise between 1997 and
2015, in the interest of justice we decline to
interfere with such orders, given our
discretionary jurisdiction under Article 136
of the Constitution of India. We therefore
declare that the provisions of the Land
Acquisition Act relating to solatium and
interest contained in Sections 23(1-A) and
(2) and interest payable in terms of Section
28 proviso will apply to acquisitions made
under
the
National
Highways
Act.
Consequently, the provision of Section 3-J
is, to this extent, violative of Article 14 of
the Constitution of India and, therefore,
declared
to
be
unconstitutional.
Accordingly, appeal arising out of SLP (C)
No. 9599 of 2019 is dismissed.

17. From a reading of the principles
extensively laid down in Tarsem Singh, it is
evident that what has been made applicable
by the Central Government through their
order dated 28.08.2015, quoted in extenso in
Paragraph No. 47 of the report in Tarsem
Singh, is a limited application of the
provisions of the Act of 2013 relating to
determination of compensation, rehabilitation
and
resettlement
and
extension
of
infrastructure amenities. It is not a complete
supplant of the provisions of the Act of 1956
by those of the Act of 2013. The Commercial
Court has, in our opinion, therefore,
completely gone wrong in holding that the
remedy against the award passed by the
Statutory Arbitrator under the Act of 1956
would not be an application under Section 34
of the Act of 1996, but a reference to the
Authority constituted under Section 51 of the
Act of 2013. It is held, accordingly.

18. There is another aspect of the
matter. And, that is, what would be the forum
before which the application under Section
34 of the Act of 1996 would lie. The
petitioners thought that since it is an
arbitration application, they should go to the
Commercial Court, instead of the Principal
Civil Court of original jurisdiction in the
district. This issue fell for consideration
before the Uttarakhand High in Richa Bisht
v. Union of India, AIROnline 2020 UTR
478. It was held in Richa Bisht (supra):

13.From the scheme of the Act, it
is apparent that only a commercial dispute
can be tried by a commercial Court. For a
dispute to qualify as commercial dispute, it
must fall within one of the clauses of Section
2 (i) (c) of the Commercial Courts Act, 2015.
A dispute will not become a commercial
dispute merely because it is an arbitration
matter and has been dealt with separately
under Sections 10 and 15(2) of the said Act.

14.Every application filed under
Section
34
of
the
Arbitration
and
Conciliation Act cannot be transferred to
the commercial Court under Section 15(2)
of the Commercial Courts Act, 2015 and
only such applications will be required to
be transferred, which are relating to a
commercial dispute of a specified value.

15.The dispute, which petitioners
raised before learned District Judge does
not fall under any clause of 8 Section 2 (1)
(c) of the Act, which defines 'commercial
disputes'.

16. Clause (xxii) of Section 2 (1)
(c) enables the Central Government to
11 All. Gangu Vs. Smt. Alka Arora & Anr.
301
include any other dispute in the definition of
'commercial dispute' by notification.

17. On 03.03.2020, Mr. Manoj
Kumar,
learned
Central
Government
Standing
Counsel
was
asked
to
get
instructions whether the Central Government
has issued any notification, as contemplated
under Section 2(1) (c) (xxii) of the
Commercial Courts Act, 2015. He was
further asked to get definite instruction as to
whether the dispute arising out of land
acquisition for the purpose of construction of
highway has been treated as commercial
dispute by any notification issued by the
Central Government under Section 2(1) (c)
(xxii) of the Act.

18. Today, Mr. Manoj Kumar,
learned
Central
Government
Standing
Counsel, on instructions, submitted that no
such notification has been issued by the
Central Government under Section 2(1) (c)
(xxii) of the aforesaid Act.

19. It is nobody's case that
petitioners are into real estate business.
Learned counsel appearing for respondent no.
2 fairly concedes that petitioners are not
doing trade or business in immovable
property. It is an admitted position that the
property belonging to the petitioners were
compulsorily acquired under the provisions
of National Highways Act, 1956, therefore,
Clause-vii of Section 2(1) (c) of the
Commercial Courts Act, 2015 also cannot be
pressed into service for treating 9 the dispute
raised by the petitioners before the District
Judge, as commercial dispute.

20. In view of the aforesaid
discussion, this Court has no hesitation in
holding that the dispute raised by the
petitioners before the learned District Judge is
not a 'commercial dispute', therefore, learned
District Judge erred in transferring the
application filed by the petitioners under
Section 34 of the Arbitration and Conciliation
Act to the Commercial Court, Dehradun.

19. The principles in Richa Bisht are
squarely applicable to the facts here,
because the petitioners' land has been
acquired for the purpose of a National
Highway. It is by no means a 'commercial
dispute' within the meaning of Section
2(1)(c) of the Commercial Courts Act,
2015. For the said reason, the application
under Section 34 of the Act of 1996 would
not be maintainable before the Commercial
Court. Thus, for reasons very different
from those that have weighed with the
Commercial Court in passing the order
impugned, this Court concurs in the
conclusions reached. It is made clear that
upon return of the application under
Section 34 of the Act of 1996 to the
petitioners, it would be open to them,
subject of course to the law of limitation, to
institute proceedings, if so advised, before
the Court of competent jurisdiction, entitled
to hear an application under Section 34 of
the Act of 1996.

20. Subject to the above clarifications,
this petition is dismissed. There shall be no
order as to costs.
----------
(2022) 11 ILRA 301
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 29.09.2022

BEFORE

THE HON'BLE J.J. MUNIR, J.

Matter Under Article 227 No. 2725 of 2022

Gangu ...Petitioner
Versus
Smt. Alka Arora & Anr. ...Respondents

Counsel for the Petitioner:
Sri Sunil Kumar Srivastava

Counsel for the Respondents:
Prakhar Tandon