CMA/3705/2021 of S.RAJENDRAN Vs THE ARBITRATOR/DISTRICT COLLECTOR
C.M.A.No.3705 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 15.04.2026
CORAM
THE HONOURABLE MR.JUSTICE P.VELMURUGAN
and
THE HONOURABLE MRS. JUSTICE K. GOVINDARAJAN THILAKAVADI
C.M.A.No.3705 of 2021
S. Rajendran ...Appellant
Vs.
1.The Arbitrator/District Collector,
Collectorate, Villupuram
2.The Authorized Officer/Special District Revenue Officer,
Land Acquisition (National Highways No.68)
Salem-4.
3.The Project Director,
National Highway Authority of India,
Narasothipatti, Salem-636 004. ...Respondents
Prayer: This Civil Miscellaneous Appeal is filed under Section 37(1) (a) of the
Arbitration and Conciliation Act, 1996, to set aside the order dated 21.12.2020
passed in Arbitration OP.No.87 of 2017 on the file of the Principal Dist rict
Judge, Villupuram.
For Appellant : Mr.R.Nalliyappan
1/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
For Respondents: Mr.P.Gurunathan
Additional Government Pleader for R1 & R2
Mr.Su.Srinivasan, Standing Counsel for R3
JUDGMENT
K. GOVINDARAJAN THILAKAVADI,J.
This appeal is filed by the claimant/land owner against the fa ir and
decreetal order dated 21.12.2020 passed in Arbitration OP.No.87 of 2017 on the
file of the Principal District Judge, Villupuram.
2. The brief facts which are necessary for disposal of this appeal are as
follows:
The lands in survey Nos.19/1C2, 19/1D2, 19/1F1, 19/2A, 19/2B1,
19/1B2, 19/1F1 and 19/2B1, measuring to a total extent of 3631 sq. mtr. in
Chinna Salem Village, Chinna Salem Taluk, Villupuram District, bel ong to the
appellant/ land owner were acquired by the 2nd respondent for laying 4 way lane
road under National Highways Authorities Act. A sum of Rs.1,34,347/- was
awarded by the 2 nd respondent to the appellant by fixing the land value at
2/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
Rs.37/- per sq. mtr. The appellant, under protest, received the said a mount and
filed an application before the 1 st respondent /Arbitrator on 14.03.2016. The 1 st
respondent conducted the enquiry and passed an Arbitration Award in
proceedings in Na.Ka(Arbit) A2/11071/2016 dated 09.09.2016. Aggrieved by
the same, the appellant /land owner filed an application under Section 34 of
Arbitration and Conciliation Act, 1996 (herein after referred as “the Act’’) in
Arb.OP.No.87/2017 before the Principal District Judge, Villupuram and the
same was dismissed on 21.12.2020 . Aggrieved by this, the present appeal is
preferred.
3.The learned counsel for the appellant/land owner would submit that the
1st respondent/Competent Authority in the order dated 09.09.2016 has stated
that the said lands are adjacent to Chinna Salem Circle, Nat ional Highways
NH-68, Villupuram District and hence, the tribunal ought to have appre ciated
that the properties which were acquired by 3 rd respondent are existing very near
to the residential area, school, hotel, hospital, shopping complex , et c., and
hence the same has to be valued as plotable site. Whereas, the 1 st respondent,
without considering the same, enhanced the compensation for all the appl icants
to the extent of 100% and passed the award without considering the doc ument
3/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
properly. He further submitted that the properties acquired by the 3rd
respondent are house sites, hence, it is not correct to fix the value of the
property at the rate of Rs.74/-per sq mtr and that the acquired pr operty will
easily fetch atleast Rs.80/- per sq. ft. The learned counsel for the appellant
further submitted that the 1 st respondent/District Collector/Arbitrator failed to
consider the documents relied upon by the appellant/land owner for ascertaining
the correct market value for the acquired lands. Further learned counsel
submitted that the Learned Principal District Judge, Villupuram, failed to
consider the contentions made by the appellant /land owner and erroneously
dismissed the petition filed under Section 34 of the Act, warrants interference
by this Court.
4.On the other hand, the learned counsel for the respondents would
submit that, the lands in question were taken over by the National Highways.
Thereafter, the Competent Authority (Land Acquisition), Salem, awarded a sum
of Rs.1,34,347/- by fixing the land value at Rs.37/- per sq. mtr.. On an appeal
by the land owner, the 1 st respondent / Arbitrator, after conducting enquiry,
passed an award on 09.09.2016, by enhancing the value fixed by the 2nd
respondent by 100% for the acquired lands. Hence the learned counsel for t he
4/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
respondents contends that the award passed by the competent Authority is just
and requires any interference by this Court. Therefore, prayed for dismissal of
the appeal.
5.Heard on both sides, records perused.
6. The scope of interference under Section 34 and 37 of the Arbitrati on
Act, regarding NHAI land compensation is strictly narrow, limit ed to setting
aside awards for perversity, lack of jurisdiction or, violation of publi c policy.
Courts cannot re appreciate evidence or substitute their own views on valuation
as the arbitrator is the final authority on facts.
7.On perusal of records, it is seen that, the land owner, dissatisfied with
the award, sought for arbitration, under Section 3G(5) of the National Highways
Act. The District Collector, who was appointed as an Arbitrator, after
conducting enquiry, enhanced the value fixed by the 2 nd respondent by 100%,
by its order dated 09.09.2016. This award was sought to be set aside in an
application under Section 34 of the Arbitration and Conciliation Act, 1996, filed
before the Principal District Judge, Villupuram. The learned Pri ncipal District
5/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
Judge, Villupuram, dismissed the said application on 21.12.2020. It is this or der
of the learned Principal District Judge passed under Section 34 of the Act,
which is subject matter of the challenge.
8.The learned counsel for the appellant/land owner contended that the
lands acquired and the lands adjacent thereto possessed of similar potentialities.
It is not in dispute that the National Highways Authority of India, ha s acquired
lands of the appellant/land owner as per Section 3A(1) of the National
Highways Act, 1956 and the same was published in Government Notificati on
No.890 S O 1564 (E) dated 26.06.2008 and 3A (3) notice was also published in
Tamil and English daily on 20.08.2008. As per Section 3 D (1) of National
Highways Act, 1956(48/1956), notification was also published in Central
Gazette Notification No.438 SO 675 (E) dated 13.03.2009 and also 3G (3)
notification was also published in Tamil and English daily paper on 12.04.2009.
On the basis of the notification the land owners were enquired and the
documents were perused by the 2nd Respondent and order was passed by an
order No.286 of 2009 dated 07.09.2009.
6/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
9.According to the appellant/land owners the competent authority under
the NHA, had determined very low compensation for the land owners. I t is
settled law that when an arbitral award is challenged unde r Section 34 of the
Arbitration Act, no challenge can be made on the merits of the arbitral award. It
is also well settled that it is the duty of the claimant to produce relevant
documents before the competent authority and the District Collector f or fixing
the market value of the acquired lands.
10.The 2 nd respondent /Competent Authority (Land Acquisition) passed
the award on 07.09.2009 determining compensation for the lands acquired. It is
not in dispute that the lands were acquired for public purpose under the National
High Ways Act, 1956 and not for any commercial purpose. It is to be noted that,
the competent authority or the arbitrator while determining the amount under
Sub Section (1) or Sub Section (5) of Section 3(G) of the NH Act, as a case may
be, shall take into consideration :-
(a) the market value of the land on the date of publication of the
notification under Section 3 A;
(b) the damage, if any, sustained by the person interested at the time of
7/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
taking possession of.
11.Therefore, the market value of the land on the date of publication of
notification under Section 3A is the relevant date and no other rele vant date can
be considered. The appellant has solely contended that the tribunal ought to
have appreciated that the properties which were acquired by 3 rd respondent are
house sites, whereas, the 1st respondent, without considering the same, enhanced
only 100% of the value fixed by the 2 nd respondent, which is very meager. It is
pertinent to note that, the appellant has not produced any documents to
substantiate his claim before the respondents. Therefore, the argument of the
learned counsel for the appellant / land owner that, the learned Di strict Judge
failed to consider the enhancement of the compensation claim submitt ed by the
land owner cannot be accepted.
12.As mentioned earlier, the scope of judicial interference under Sec tion
34 (setting aside) and Section 37 (appeal) of the Arbitration and C onciliation
Act, 1996, any compensation awarded for land acquired by the National
Highway Authority of India is extremely narrow and circumscribed. The
Hon’ble Supreme Court has mandated that courts cannot re-appreciate evidence,
8/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
correct errors or modify the award on its merits. But, can only set aside if it falls
under limited statutory grounds. The Arbitrator is the final court of facts.
Therefore, courts cannot re appreciate evidence to determine if land plots are
similar or if deduction rates are appropriate. Under Section 34, a Court cannot
modify, vary, or increase/decrease the compensation amount awarded by t he
arbitrator. It can only set aside the award entirely or in pa rt, leaving the parties
to initiate fresh arbitration. Interference is only permitted if the award is
patently illegal (going to the root of the matter), violates public policy of India
or suffers from fundamental procedural unfairness (natural justice violat ion).
The scope of the petitioner under Section 37 of the Act is narrower than
Section 34. The appellate court cannot undertake an independent assessment of
the merits and must only check if the Section 34 Court overstepped its
jurisdiction.
13.On perusal of the records, it is seen that the 1 st respondent has strictly
acted within the provisions of law and followed all the procedures i n arriving at
the compensation amount and passed a well considered Award by following the
mandatory provisions of law after affording reasonable and adequate
opportunity to the appellant and the same was confirmed by the learned
9/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
Principal District Judge, Villupuram, warrants any interference.
14. This Court is of the considered view that there is no merit i n this
appeal and the learned Principal District Judge, Villupuram, under the
impugned order dated 21.12.2020 passed in Arb.OP.No.87 of 2017 under
Section 34 of the Arbitration and Conciliation Act has rightly dismissed the said
application. There is no infirmity in the impugned order and the civil
miscellaneous appeal is dismissed. No costs.
(P.V.J.,) (K.G.T.J.,)
15.04.2026
Index: Yes/No
Internet: Yes/No
Speaking/Non-Speaking order
bga
To
1. The Principal District Judge, Villupuram.
2.The District Collector/Arbitrator
Villupuram District, Tamil Nadu,
10/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
3.The Authorized Officer/Special District Revenue Officer,
Land Acquisition (National Highways No.68)
Salem-4.
4.The Project Director,
National Highway Authority of India,
Narasothipatti, Salem-636 004.
11/12
https://www.mhc.tn.gov.in/judis
C.M.A.No.3705 of 2021
P.VELMURUGAN,J.
and
K.GOVINDARAJAN THILAKAVADI,J.
bga
C.M.A.No.3705 of 2021
15.04.2026
12/12
https://www.mhc.tn.gov.in/judis