Himachal Pradesh High Court
Nhai vs Paras Ram & Others on 22 December, 2025
1
( 2025:HHC:45058 )
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
.
CMPMO No. 767 of 2025 a/w CMPMO
Nos.766, 765, 764, 763, 762 & 761 of 2025
Date of Decision: 22.12.2025
1.CMPMO No.767 of 2025
NHAI
...... petitioner
of
Versus
Paras Ram & others
......Respondents
rt
2. CMPMO No. 766 of 2025
NHAI
...... petitioner
Versus
Atma Ram and others
......Respondents
__________________________________________________________
3. CMPMO No. 765 of 2025
NHAI
...... petitioner
Versus
Chain Singh and others
......Respondents
__________________________________________________________
4. CMPMO No. 764 of 2025
NHAI
...... petitioner
Versus
Madan Lal and another
......Respondents
_______________________________________________________
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2
5. CMPMO No. 763 of 2025
NHAI
...... petitioner
.
Versus
Rattani Devi and another
......Respondents
_______________________________________________________
6. CMPMO No. 762 of 2025
NHAI
...... petitioner
of
Versus
Soma Devi and others
......Respondents
_______________________________________________________
rt
7. CMPMO No. 761of 2025
NHAI
...... petitioner
Versus
Mansa Ram and another
......Respondents
___________________________________________________________
Coram:
The Hon'ble Mr. Justice Bipin Chander Negi, Judge
1
Whether approved for reporting?
For the petitioner(s) : M/s Sumit Raj Sharma, Mohit, Ritu Sharma, Advocates, in all the petitions.
For the respondent(s) : Nemo.
Bipin Chander Negi, Judge(oral) The present petitions have been preferred against the impugned order dated 28.06.2025, whereby the objections filed before the District Judge, Bilaspur by the present petitioner(s), seeking 1 Whether reporters of Local Papers may be allowed to see the judgment?
::: Downloaded on - 02/01/2026 20:36:16 :::CIS 3rejection of the Section 34 petition filed by the present respondent(s), laying challenge to the award passed by the Arbitrator, being not .
maintainable, as according to the petitioner(s), the seat of arbitration in the case at hand was Mandi, therefore, Section 34 application could have only been preferred before the District Judge at Mandi, have been rejected.Since a common question arises for consideration, therefore, of the present petitions are being taken up together.
2. The arbitrator in the case at hand is appointed by the Central Government under section 3-G (5) of the National Highways rt Act, 1956.The same reads as follows;
3-G. Determination of amount payable as compensation.
(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.
3. Section 3-G (6) of the National Highways Act, 1956 makes the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996)applicable to every arbitration under the National Highways Act, 1956. Generally speaking, regulation of arbitration consists of four steps under the Arbitration and Conciliation Act, 1996:
::: Downloaded on - 02/01/2026 20:36:16 :::CIS 4(a)In Part I, of the Arbitration and Conciliation Act, 1996 (26 of 1996)Section 8 regulates the commencement of arbitration;
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(b) In Part I, of the Arbitration and Conciliation Act, 1996 (26 of 1996)Sections 3, 4, 5, 6, 10 to 26, 28 to 33 the conduct of arbitration;
(c) In Part I, of the Arbitration and Conciliation Act, 1996 (26 of 1996)Section 34 regulates the challenge to the award; and of
(d) In Part I,of the Arbitration and Conciliation Act, 1996 (26 of 1996) Sections 35 and 36 the recognition or enforcement of the award.
Sections 1, 2, 7, 9, 27, 37, 38 to 43 are ancillary rt provision(s) that either support the arbitral process or are structurally necessary. Thus, it can be seen that Part I deals with all stages of the arbitrations which take place in India.See paras 121,122 of Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552.
4. Sections 2(2) and 2 (4) contained in Part I of the Arbitration Act, 1996 read as follows:
(2) Scope--This part shall apply where the place of arbitration is in India:
Provided that subject to an agreement to the contrary, the provisions of Sections 9, 27 and clause (a) of sub-section (1) and sub-section (3) of Section 37 shall also apply to international commercial arbitration, even if the place of arbitration is outside India, and an arbitral award made or to be made in such place is enforceable and recognised under the provisions of Part II of this Act.
2. (4) This Part except sub-section (1) of Section 40, Sections 41 and 43 shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that other enactment were an arbitration agreement ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 5 except insofar as the provisions of this Part are inconsistent with that other enactment or with any rules made thereunder."
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5. Section 2(4) of the Arbitration Act makes Part I applicable to "every arbitration under any other enactment for the time being in force". Hence, there must be an enactment "for the time being in force"
under which arbitration takes place. Any "other enactment" would in its of ordinary meaning contemplate only an Act made by the Indian Parliament. By virtue of Article 245, "Parliament may make laws for the whole or any part of India".
6. rt The aforesaid two sub-sections merely recognise that apart from the arbitrations which are consensual between the parties, there may be other types of arbitrations, namely, arbitrations under a statute like 3-G (5) of the National Highways Act, 1956 as in the case at hand.
Such arbitrations would have to be regarded as covered by Part I of the Arbitration Act, 1996, except insofar as the provisi any rules made thereunder. The arbitration would be deemed to be in pursuance to an arbitration agreement "and as if that other enactment were an arbitration agreement".
7. As already stated supra in terms of 3-G (6) of the National Highways Act, 1956 the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996), shall apply to every arbitration under the National Highways Act, 1956. Other than the aforesaid in view of ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 6 Section 2(4) of the Arbitration and Conciliation Act, 1996 (26 of 1996) Part I thereof is made applicable to every arbitration under the National .
Highways Act, 1956 except insofar as the provisions of Part I are inconsistent with the National Highways Act, 1956 or any rules made thereunder. By virtue of the deeming provision contained in Section 2(4) of the Arbitration and Conciliation Act, 1996 (26 of 1996) the National of Highways Act, 1956 is treated as an arbitration agreement.
8. The Arbitration Act, 1996 refers to "the place" of arbitration and defines "court", and indicates which courts have jurisdiction in rt relation to arbitral proceedings in several sections in Part I. In this respect Sections 2(1)(e), 2(2)(already referred supra), 20,31(4) and 42 of the Arbitration Act, 1996 of the Arbitration Act, 1996 are relevant.
Sections 2(1)(e) reads as follows:
"2. Definitions.--(1) In this Part, unless the context otherwise requires
(e) "Court" means--
(i) in the case of an arbitration other than international commercial arbitration, the principal civil court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject-
matter of the arbitration if the same had been the subject- matter of a suit, but does not include any civil court of a grade inferior to such principal civil court, or any Court of Small Causes;
9. The aforesaid provision came up for consideration in Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 7 (2012) 9 SCC552 wherein the apex court held Section 2(1)(e) to be purely jurisdictional in nature as it has a reference and connection with .
the process of dispute resolution. Its purpose is to identify the courts having supervisory control over the arbitration proceedings. The same as per the apex court has to be construed keeping in view the provisions in Section 20 which recognizes party autonomy. The apex of court categorically held under the arbitration act legislature has intentionally given jurisdiction to two courts one where the cause of action is located and the other where the arbitration takes place. The rt relevant extract reads as follows;
96.....................................We are of the opinion, the term "subject-matter of the arbitration" cannot be confused with "subject-matter of the suit". The term "subject-matter"
in Section 2(1)(e) is confined to Part I. It has a reference and connection with the process of dispute resolution. Its purpose is to identify the courts having supervisory control over the arbitration proceedings. Hence, it refers to a court which would essentially be a court of the seat of the arbitration process. In our opinion, the provision in Section 2(1)(e) has to be construed keeping in view the provisions in Section 20 which give recognition to party autonomy. Accepting the narrow construction as projected by the learned counsel for the appellants would, in fact, render Section 20 nugatory. In our view, the legislature has intentionally given jurisdiction to two courts i.e. the court which would have jurisdiction where the cause of action is located and the courts where the arbitration takes place. This was necessary as on many occasions the agreement may provide for a seat of arbitration at a place which would be neutral to both the parties. Therefore, the courts where the arbitration takes place would be required to exercise supervisory control over the arbitral process. For example, if the arbitration is held in Delhi, where neither of the parties are from Delhi, (Delhi having been chosen as a ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 8 neutral place as between a party from Mumbai and the other from Kolkata) and the tribunal sitting in Delhi passes an interim order under Section 17 of the Arbitration Act, 1996, the appeal against such an interim order under .
Section 37 must lie to the courts of Delhi being the courts having supervisory jurisdiction over the arbitration proceedings and the tribunal. This would be irrespective of the fact that the obligations to be performed under the contract were to be performed either at Mumbai or at Kolkata, and only arbitration is to take place in Delhi. In such circumstances, both the courts would have jurisdiction i.e. the court within whose jurisdiction the of subject-matter of the suit is situated and the courts within the jurisdiction of which the dispute resolution i.e. arbitration is located.
97.The definition of Section 2(1)(e) includes "subject- rt matter of the arbitration" to give jurisdiction to the courts where the arbitration takes place, which otherwise would not exist. On the other hand, Section 47 which is in Part II of the Arbitration Act, 1996 dealing with enforcement of certain foreign awards has defined the term "court" as a court having jurisdiction over the subject-matter of the award. This has a clear reference to a court within whose jurisdiction the asset/person is located, against which/whom the enforcement of the international arbitral award is sought. The provisions contained in Section 2(1)(e) being purely jurisdictional in nature can have no relevance to the question whether Part I applies to arbitrations which take place outside India.
10. In BGS SGS SOMA JV v. NHPC, (2020) 4 SCC 234 para 96 of BALCO(2012) 9 SCC 552 reproduced herein above was considered by the apex court. The idea of concurrent jurisdiction of the seat court and the court within whose jurisdiction the cause of action arose was dispelled. The following was stated;
First and foremost, it is incorrect to state that the example given by the Court in para 96 of BALCO(2012) 9 SCC 552 reinforces the concurrent jurisdiction aspect of the said ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 9 paragraph. As has been pointed out by us, the conclusion that the Delhi as well as the Mumbai or Kolkata courts would have jurisdiction in the example given in the said paragraph is wholly incorrect, given the sentence, "This .
would be irrespective of the fact that the obligations to be performed under the contract were to be performed either at Mumbai or at Kolkata, and only arbitration is to take place in Delhi". The sentence which follows this is out of sync with this sentence, and the other paragraphs of the judgment. Thus, BALCO(2012) 9 SCC 552 does not "unmistakably" hold that two courts have concurrent jurisdiction i.e. the seat court and the court within whose of jurisdiction the cause of action arises. What is missed by these High Court judgments is the subsequent paragraphs in BALCO(2012) 9 SCC 552, which clearly and unmistakably state that the choosing of a "seat amounts to the choosing of the exclusive jurisdiction of the courts at rt which the "seat" is located. What is also missed are the judgments of this Court in Enercon (India) Ltd.(2014) 5 SCC 1and Reliance Industries Ltd.(2014) 7 SCC 603.
11. The arbitrator in the case at hand is statutorily appointed.
Provisions of Arbitration and Conciliation Act, 1996 (26 of 1996) and National Highways Act, 1956 are applicable in the case at hand. Neither determine the "seat" of arbitration. The notification issued in pursuance to 3-G (5) of the National Highways Act, 1956 dated 22-03-12 only specifies the arbitrator i.e Divisional commissioner, Mandi with territorial jurisdiction over districts Bilaspur (where the lands in case at hand were acquired), Mandi and Kullu. The notification dated 22-03-12 also does not specify the "seat" of arbitration. Incidentally the Divisional Commissioner, Mandi has his office at Mandi.
12. Section 20 and the relevant extract of 31(4) of the arbitration act read as under;
::: Downloaded on - 02/01/2026 20:36:16 :::CIS 1020.Place of arbitration.--(1) The parties are free to agree on the place of arbitration.
(2) Failing any agreement referred to in sub-section (1), .
the place of arbitration shall be determined by the Arbitral Tribunal having regard to the circumstances of the case, including the convenience of the parties.
(3) Notwithstanding sub-section (1) or sub-section (2), the Arbitral Tribunal may, unless otherwise agreed by the parties, meet at any place it considers appropriate for consultation among its members, for hearing witnesses, of experts or the parties, or for inspection of documents, goods or other property.
31. Form and contents of arbitral award.--(1)-(3) * * * rt (4) The arbitral award shall state its date and the place of arbitration as determined in accordance with Section 20 and the award shall be deemed to have been made at that place.
13. A plain reading of Section 20 leaves no room for doubt that where the place of arbitration is in India, the parties are free to agree to any "place" or "seat" within India, be it Delhi, Mumbai, etc. In the absence of the parties' agreement thereto, Section 20(2) authorises the tribunal to determine the place/seat of such arbitration. Section 20(3) enables the tribunal to meet at any place for conducting hearings at a place of convenience in matters such as consultations among its members for hearing witnesses, experts or the parties.
14. The BALCO,( (2012) 9 SCC 552) judgment in no uncertain terms has referred to "place" as "juridical seat" for the purpose of Section 2(2) of the Act. It further made it clear that Sections 20(1) and ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 11 20(2) where the word "place" is used, refers to "juridical seat", whereas in Section 20(3), the word "place" is equivalent to "venue".
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15. The moment a seat is designated by agreement between the parties, it is akin to an exclusive jurisdiction clause, which would then vest the courts at the "seat" with exclusive jurisdiction for purposes of regulating arbitral proceedings arising out of the agreement between of the parties.BGS SGS SOMA JV v. NHPC, (2020) 4 SCC 234.
16. There is only one "place of Arbitration". This will be the place chosen by or on behalf of the parties; and it will be designated in rt the arbitration agreement or the terms of reference or the minutes of proceedings or in some other way as the place or "seat" of the arbitration. No "place of Arbitration" has been determined in the case at hand by either the parties or the arbitrator. It is not the requirement of law that the Arbitral Tribunal must hold all its meetings or hearings at the place of arbitration. Mandi is where the Divisional Commissioner i.e the arbitrator is officially stationed. Holding of meetings or hearings at Mandi does not determine the "place of Arbitration". Mandi is only the venue where meetings or hearings for its own convenience are held by the arbitrator in the case at hand. This view is fortified by the authoritative pronouncement of the apex court in Bharat Aluminium Co.
v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552 relevant portion whereof reads as follows;
::: Downloaded on - 02/01/2026 20:36:16 :::CIS 1275. We are also unable to accept the submission of the learned counsel for the appellants that the Arbitration Act, 1996 does not make seat of the arbitration as the centre of gravity of the arbitration. On the contrary, it is .
accepted by most of the experts that in most of the national laws, arbitrations are anchored to the seat/place/situs of arbitration. Redfern in Para 3.54 concludes that "the seat of the arbitration is thus intended to be its centre of gravity."This, however, does not mean that all the proceedings of the arbitration have to take place at the seat of the arbitration. The arbitrators at times hold meetings at more convenient locations.
of This is necessary as arbitrators often come from different countries. It may, therefore, on occasions be convenient to hold some of the meetings in a location which may be convenient to all. Such a situation was examined by the Court of Appeal in England in Naviera Amazonica rt Peruana S.A. v. Compania International de Seguros del Peru wherein at p. 121 it is observed as follows:
"The preceding discussion has been on the basis that there is only one 'place' of arbitration. This will be the place chosen by or on behalf of the parties; and it will be designated in the arbitration agreement or the terms of reference or the minutes of proceedings or in some other way as the place or 'seat' of the arbitration. This does not mean, however, that the Arbitral Tribunal must hold all its meetings or hearings at the place of arbitration.
International commercial arbitration often involves people of many different nationalities, from many different countries. In these circumstances, it is by no means unusual for an Arbitral Tribunal to hold meetings--or even hearings--in a place other than the designated place of arbitration, either for its own convenience or for the convenience of the parties or their witnesses.... It may be more convenient for an Arbitral Tribunal sitting in one country to conduct a hearing in another country -- for instance, for the purpose of taking evidence.... In such circumstances each move of the Arbitral Tribunal does not of itself mean that the seat of arbitration changes. The seat of arbitration remains the place initially agreed by or on behalf of the parties."
(emphasis supplied) ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 13 These observations were subsequently followed in Union of India v. McDonnell Douglas Corpn.
17. The award of the arbitrator in the case at hand has been .
assailed by both the parties by filing petitions under section 34 of the arbitration act before the Principal Court of Original Jurisdiction in the district. Section 34 applications to set aside arbitral awards are applications which are within (contemplated) Section 42.The present of petitioner (NHAI) has assailed the same before the District Judge Mandi whereas the respondent has assailed the same before the District rt Judge Bilaspur. However, the challenge in the case at hand to the arbitration award was made prior in point of time by the present respondent.
18. In all these cases, barring CMPMO Nos. 763, 766 & 767 of 2025, the Section 34 petition challenging the award passed by the Arbitrator had been preferred by the present respondents before the District Judge, Bilaspur on 03.11.2023. Similarly, the Section 34 application filed by the present petitioner(s) assailing the same award was preferred before the District Judge, Mandi on 16.12.2023. The same is evident from the list of dates filed in the present petitions.
19. In CMPMO No. 763 of 2025, the application under Section 34 was preferred by the present respondent(s) before the District Judge, Bilaspur on 03.11.2023. Likewise, the Section 34 petition laying ::: Downloaded on - 02/01/2026 20:36:16 :::CIS 14 challenge to the same award was filed by the present petitioner before the District Judge, Mandi on 28.12.2023.
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20. In CMPMO No. 766 of 2025, the application under Section 34 was preferred by the present respondent(s) before the District Judge, Bilaspur on 03.11.2023. Likewise, the Section 34 petition laying challenge to the same award was filed by the present petitioner before of the District Judge, Mandi on 06.11.2023.
21. In CMPMO No. 767 of 2025, the application under Section 34 was preferred by the present respondent(s) before the District Judge, rt Bilaspur on 20.11.2023. Likewise, the Section 34 petition laying challenge to the same award was filed by the present petitioner before the District Judge, Mandi on 20.02.2024.
22. Hence in terms of Section 42 of the arbitration act the court at Bilaspur alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of the arbitral proceedings shall be made in that Court and in no other Court.
Section 42 of the arbitration act reads as under;
42. Jurisdiction.-- Notwithstanding anything contained elsewhere in this Part or any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in any Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other Court."
::: Downloaded on - 02/01/2026 20:36:16 :::CIS 1523. The expression "with respect to an arbitration agreement"
makes it clear that Section 42 will apply to all applications made .
whether before or during arbitral proceedings or after an award is pronounced under Part I of the 1996 Act. Section 34 applications to set aside arbitral awards are applications which are within Section 42. In this respect reference can be made to judgement of the apex court in of State of W.B. v. Associated Contractors, (2015) 1 SCC 32, relevant extract whereof reads as follows;
rt
25. Our conclusions therefore on Section 2(1)(e) and Section 42 of the Arbitration Act, 1996 are as follows:
(a) Section 2(1)(e) contains an exhaustive definition marking out only the Principal Civil Court of Original Jurisdiction in a district or a High Court having original civil jurisdiction in the State, and no other court as "court" for the purpose of Part I of the Arbitration Act, 1996.
(b) The expression "with respect to an arbitration agreement" makes it clear that Section 42 will apply to all applications made whether before or during arbitral proceedings or after an award is pronounced under Part I of the 1996 Act.
(c) However, Section 42 only applies to applications made under Part I if they are made to a court as defined. Since applications made under Section 8 are made to judicial authorities and since applications under Section 11 are made to the Chief Justice or his designate, the judicial authority and the Chief Justice or his designate not being court as defined, such applications would be outside Section 42.
(d) Section 9 applications being applications made to a court and Section 34 applications to set aside arbitral awards are applications which are within Section 42.::: Downloaded on - 02/01/2026 20:36:16 :::CIS 16
(e) In no circumstances can the Supreme Court be "court"
for the purposes of Section 2(1)(e), and whether the Supreme Court does or does not retain seisin after appointing an arbitrator, applications will follow the first .
application made before either a High Court having original jurisdiction in the State or a Principal Civil Court having original jurisdiction in the district, as the case may be.
(f) Section 42 will apply to applications made after the arbitral proceedings have come to an end provided they are made under Part I.
(g) If a first application is made to a court which is neither a of Principal Court of Original Jurisdiction in a district or a High Court exercising original jurisdiction in a State, such application not being to a court as defined would be outside Section 42. Also, an application made to a court without subject-matter jurisdiction would be outside Section 42.
24. rt In view of the foregoing discussion and for the reasons stated hereinabove, the present petitions are dismissed being devoid of any merit. The impugned order dated 28.06.2025 passed by the learned District Judge, Bilaspur for the reasons stated hereinabove does not call for any interference. Consequently, all pending miscellaneous applications, if any, also stand disposed of.
(Bipin Chander Negi)
22nd December, 2025 (Tarun) Judge
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