National Highways Authorityof India vs Sayedabad Tea Company Ltd. and Ors.

HELD: 1.1 The National Highways Act, 1956 is a comprehensive code and a special enactment which provides an inbuilt mechanism not only in initiating acquisition until culmination of the proceedings in determining the compensation and its adjudication by the Arbitrator to be appointed by the Central Government and if still remain dissatisfied, by the Court of law. In compliance of the mandate of Sections 3A to 3F of the Act, 1956, after the land is acquired, there shall be paid an amount of compensation which shall be determined by an order of the competent authority under sub-sections (1) or (2) of Section 3G of the Act, 1956 and any person who is aggrieved by the amount so determined by the competent authority or what being determined is not acceptable to either of the parties, on an application being filed by either of the parties, has to be determined by the Arbitrator to be appointed by the Central Government in terms of sub-section (5) of Section 3G of the Act, 1956. After analysing the scheme, it can be assumed that the legislature intended the Act, 1956 to act as a complete code in itself for the purpose of acquisition until culmination including disbursement and for settlement of disputes and this conclusion is further strengthened in view of Section 3J of the Act which eliminates the application of the Land Acquisition Act, 1894, to an acquisition under the Act, 1956. [Para 16, 17, 18][734-G-H; 735-A-D]

1.2 It is settled principles of law that when the special law sets out a self-contained code, the application of general law would impliedly be excluded. In the instant case, the scheme of Act, 1956 being a special law enacted for the purpose and for appointment of an arbitrator by the Central Government under Section 3G(5) of Act, 1956 and sub-section (6) of Section 3G itself clarifies that subject to the provisions of the Act 1956, the provisions of Act 1996 shall apply to every arbitration obviously to the extent where the Act 1956 is silent, the Arbitrator may take recourse in adjudicating the dispute invoking the provisions of the Arbitration and Conciliation Act, 1996 for the limited purpose. But so far as the appointment of an Arbitrator is concerned, the power being exclusively vested with the Central Government as envisaged under sub-section (5) of Section 3G of Act 1956, Section 11 of the Act 1996 has no application. [Para 19][735-D-F]

1.3 The plea of the respondents that they have rightly taken recourse in the facts and circumstances of Section 11 of the Act, 1996 cannot be accepted for the reason that Section 3G(6) of the Act, 1956 clearly stipulates that the provisions of the Act, 1996 will apply subject to the provisions of the Act, 1956. The usage of the expression “subject to” clearly indicates that the legislature intended to give overriding effect to the provisions of the Act, 1956 where it relates to the disputes pertaining to determination of the amount of compensation under the Act. The irresistible conclusion is that the legislature in its wisdom intended to abrogate the power for appointment of an Arbitrator under the provisions of the Act, 1996. [Para 20][735-G-H; 736-A]

1.4 The High Court was not holding its competence to appoint an Arbitrator invoking Section 11 of Act, 1996. [Para 21][736-B]

1.5 In view of the power being vested exclusively with the Central Government to appoint an Arbitrator under Section 3G(5) of the Act 1956, being a special enactment, the application filed under Section 11(6) of the Act 1996 for appointment of an Arbitrator was not maintainable and provisions of the Act, 1996 could not be invoked for the purpose. [Para 23][736-F]

1.6 The submission that as the appellant failed to make an appointment of the Arbitrator pursuant to a letter dated 8th December, 2006 in terms of Section 3G(5) of the Act, 1956 within a period of 30 days, the High Court alone was holding its competence to appoint an Arbitrator and application was submitted by the respondent-applicant on 7 th March, 2007 the right of appointment of an Arbitrator by the Central Government stands forfeited is of without substance for the reason that there is no statutory limitation provided under sub-section (5) of Section 3G of Act 1956 for the Central Government to appoint an Arbitrator but that may not give an unguided discretion to the authority and in the absence of any statutory limitation, it must be within the reasonable time and if the Central Government fails in discharge of its statutory duty in appointing an Arbitrator on a request being made by either of the party aggrieved, it will be open to the party to invoke either the writ jurisdiction of the High Court under Article 226 of the Constitution of India or the Civil Court for the purpose. But as long as the power is exclusively vested with the Central Government for appointment of an Arbitrator under Section 3G(5) of the Act 1956, the provision of Section 11 of Act 1996 has no application. [Para 24][736-G-H; 737-A-C]

1.7 The Arbitrator who was appointed by the Central Government subsequent to the filing of an application under Section 11 of the Act 1996 in April, 2007 could not proceed after the Arbitrator was appointed pursuant to the Order impugned in the instant proceedings, who too has later recused and almost 12 years have rolled by now, it is deemed appropriate to observe that there is no need to file any application by the respondentapplicant and the Central Government shall consider and appoint an Arbitrator in terms of Section 3G(5) of the Act 1956 within a period of 30 days with prior intimation to the respondents. As the litigation has consumed a sufficient long time, it is appropriate to further observe that the Arbitrator so appointed by the Central Government may adjudicate and decide the dispute within a reasonable time but in no case later than six months after the respondent-applicant record its presence in the proceedings. [Para 25][737-E-H]

1.8 The orders passed by the High Court are set aside. The Arbitrator may be appointed by the appellants in terms indicated. [Para 26][738-A]

General Manager (Project), National Highways and Infrastructure Development Corporation Ltd. v. Prakash Chand Pradhan & Ors. Civil Appeal No. 5250 of 2018 decided on 16.05.2018 – relied on.

Deep Trading Company v. Indian Oil Corporation and Others (2013) (4) SCC 35 : [2013] 2 SCR 470 – held inapplicable.

Gujarat Urja Vikash Nigam Ltd. v. Essar Power Limited 2008 (4) SCC 755 : [2008] 4 SCR 822 – referred to.