The Chhattisgarh High Court has reinforced the statutory obligation to conclude arbitration proceedings within prescribed timelines, directing the NHAI Arbitrator to decide a pending land acquisition compensation claim within four months. This order underscores the judiciary’s growing emphasis on procedural efficiency in public infrastructure disputes, where prolonged delays undermine the constitutional right to just compensation.
Background & Facts
The Dispute
The petitioner, Narsingh Sahu, is the recorded owner of two parcels of land totaling 0.102 hectares in Village Tedesara, Rajnandgaon, acquired by the National Highway Authority of India (NHAI) for highway construction. The Land Acquisition Award dated 25.02.2019 classified the land as non-irrigated Padat land, but the petitioner contends it is diverted land, entitling him to higher compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
Procedural History
The petitioner filed an application on 29.04.2023 before the Commissioner and Arbitrator (NHAI), Durg, seeking revision of the compensation amount. This application was registered as Land Acquisition Case No.32/A-82/2024-25 on 05.11.2024. Despite the case being formally registered, no decision has been rendered even after 14 months, causing undue hardship to the petitioner.
Relief Sought
The petitioner sought a writ under Article 226 directing the Arbitrator to decide the pending application expeditiously and in accordance with law, along with costs of litigation.
The Legal Issue
The central question was whether the Arbitration and Conciliation Act, 1996 imposes a binding obligation on arbitrators to conclude proceedings within a reasonable time, even when no explicit deadline is stipulated in the acquisition process.
Arguments Presented
For the Petitioner
Learned counsel relied on Section 29A of the Arbitration and Conciliation Act, 1996, which mandates that arbitral tribunals must render an award within 12 months from the date of entering appearance. He argued that the prolonged inaction by the Arbitrator violated the petitioner’s right to timely justice under Article 21 and amounted to denial of effective remedy. He also cited S.B.P. & Co. v. Patel Engineering Ltd. to emphasize that arbitration is a statutory mechanism designed for speed and finality.
For the Respondent
The State and NHAI contended that the matter was under active consideration and that delays were due to procedural complexities inherent in land acquisition cases. They submitted that no malafide intent existed and that the case would be decided expeditiously, without committing to a specific timeline.
The Court's Analysis
The Court examined the nature of the Arbitrator’s role under the NHAI framework and held that the Arbitration and Conciliation Act, 1996 applies mandatorily to all arbitrations initiated under statutory schemes, including land acquisition. The Court rejected the argument that administrative delays could override statutory timelines.
"The purpose of arbitration is to provide a speedy and efficacious alternative to litigation. Delay in adjudication defeats the very object of the statute."
The Court noted that while Section 29A prescribes a 12-month period, it also permits extension by mutual consent or court order. Here, no such extension had been sought or granted. The Court further observed that the petitioner had waited over a year without resolution, and the State’s vague assurance of "expeditious disposal" was insufficient to discharge its duty under Article 14 and Article 21.
The Court concluded that the Arbitrator’s inaction constituted a failure to perform a statutory duty, warranting judicial intervention to enforce compliance.
The Verdict
The petitioner succeeded. The Court held that Section 29A of the Arbitration and Conciliation Act, 1996 applies to NHAI arbitrations and directed the Commissioner and Arbitrator to decide the pending application within four months from receipt of the order. The Court emphasized that delay in compensation adjudication violates the right to livelihood and property under Article 21.
What This Means For Similar Cases
Arbitration Timelines Are Non-Negotiable
- Practitioners must now treat Section 29A as a mandatory ceiling, even in statutory arbitrations like land acquisition
- Failure to decide within 12 months (or extended period) invites writ jurisdiction under Article 226
- Vague assurances of "expeditious disposal" will no longer suffice to resist judicial intervention
Compensation Claims Cannot Be Stalled Indefinitely
- Landowners in acquisition cases can now invoke Article 21 to demand timely adjudication
- Delay beyond six months without justification becomes grounds for a writ petition
- Courts will not tolerate bureaucratic inertia in matters affecting livelihood
NHAI Arbitrators Are Subject to Judicial Oversight
- NHAI-appointed Arbitrators are not immune from writ jurisdiction
- Their role is quasi-judicial and bound by the same procedural discipline as civil arbitrators
- Petitioners may now seek specific timelines in writ petitions, not just general directions
