The Himachal Pradesh Court recently observed that the consent of parties for extending arbitral period need not necessarily be in writing.
Land, building, trees etc. of the appellants situated in Mandi District were acquired by the competent authority-Land Acquisition for National Highways Authority of India (NHAI). The acquisition was for construction of building and maintaining the four lane road i.e. NH-21. The award was finally passed on 01.09.2015 under Section 3(G) of the National Highways Act 1956.
The applicants-appellants preferred petition under Section 3 (G) (5) of the National Highways Act before the Arbitrator i.e. Divisional Commissioner Mandi seeking enhancement of the compensation. Other similarly situated persons, whose lands were acquired under the same award, also preferred petitions under Section 3(G) (5) of the NH Act before the Arbitrator.
The Arbitrator decided all the petitions vide a common award dated 05.09.2017. Market value of the acquired land was enhanced from Rs. 5,68,000/- per bigha to Rs. 17,00,000/- per bigha along with all statutory benefits.
Respondent-National Highways Authority of India (NHAI) moved application under Section 34 of the Arbitration and Conciliation Act before the District Judge, Mandi with a prayer for setting aside the award dated 05.09.2017. The NHAI contended that Arbitrator had erred in enhancing the amount awarded by the Competent Authority Land Acquisition.
The District Judge allowed the application moved by the respondent NHAI holding that the Arbitrator had erred in proceeding ahead with the matter after expiry of one year from the date of entering the reference without taking either the express consent of the parties or without seeking an extension from the Court as required under Section 29A of the A&C Act.
In the instant case, the Arbitrator entered upon the reference on 08.07.2016. Permissible period of 12 months within which the award could have been validly pronounced under Section 29A(1) lapsed on 07.07.2017. However, both the contesting parties continued with the proceedings. None of the parties objected to the arbitration proceedings conducted by the Arbitrator beyond 07.07.2017.
The fact that respondent NHAI had consented to the continuation of proceedings beyond 12 months is apparent from the fact that even while agitating against the award passed by the Arbitrator, it had not taken any such ground before the learned District Judge that the award passed by the Arbitrator was bad in the eyes of law on the count that mandate of the Arbitral Tribunal had lapsed on 07.07.2017.
The Court of Justice Jyotsna Rewal Dua observed that “In view of above discussion on facts & law, it has to be held that consent of the parties envisaged under Section 29A(3) of the 2015 Arbitration & Conciliation Act for extending the arbitral period need not necessarily be either express or in writing. There can be a deemed consent, an implied consent of the parties, which can be gathered from their acts and conduct”
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