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Bombay High Court

THE NATIONAL HIGHWAYS AUTHORITY OF INDIA THR. PROJECT DIRECTORversusMADHURI SHIRISH BEKE THR. POA MILIND V KULKARNI AND ORS.

Disposal
Dismissed

Holding

The Court held that an order under Section 36(3) of the Arbitration and Conciliation Act is not appealable under Section 37 and may be upheld with the condition of depositing 50% of the compensation, leading to dismissal of the writ petition.

Summary

The National Highways Authority of India (NHAI) filed a writ petition challenging an order dated 08.05.2026 that stayed an arbitral award of 08.06.2023, subject to the petitioner depositing 50% of the compensation in the District Court within two months. The respondents argued that the order was appealable under Section 37 of the Arbitration and Conciliation Act, 1996, and therefore the petition was not maintainable. The petitioner contended that the arbitrator’s award was obtained by fraud, citing a criminal FIR and an A.C.B. report, and claimed the condition of depositing half the amount was onerous. The Court held that the order was issued under Section 36(3) of the Act, which is not appealable under Section 37, and that consistency with earlier orders required the petitioner to comply with the deposit condition. Consequently, the petition was dismissed and the petitioner was directed to deposit the stipulated amount while the related civil miscellaneous application proceeds separately.

Issues considered

  • Whether an order passed under Section 36(3) of the Arbitration and Conciliation Act is appealable under Section 37, rendering the writ petition non‑maintainable.
  • Whether the condition of depositing 50% of the compensation amount as a prerequisite for the stay of the arbitral award is valid.
  • Whether allegations of fraud against the arbitrator affect the legality of the stay order.

Legislation cited

Subjects

  • Arbitration
  • Stay of award
  • Section 36
  • Section 37
  • Compensation deposit
  • Fraud
  • Writ petition
  • Maintainability
  • NHAI
  • Acquisition proceedings

Judgment

                                                                                   905-WP-2920-2026=.doc



                                    IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                             CIRCUIT BENCH AT KOLHAPUR
                                            CIVIL APPELLATE JURISDICTION

                                              WRIT PETITION NO. 2920 OF 2026
          Digitally
          signed by
          UDAY         The National Highways Authority Of India Thr.             … Petitioner
UDAY      SHIVAJI
SHIVAJI   JAGTAP       Project Director
JAGTAP    Date:
          2026.09.15
          14:50:47
          +0530
                                        Vs.
                       Madhuri Shirish Beke Thr. POA Milind V Kulkarni           … Respondents
                       and Ors.

                                                       ………….
                       Mr. Sandeep Koregave a/w Siddharth Ambegaonkar for the Petitioner
                       Mr. Tejpal S. Ingale a/w Vrunali J. Vilankar, Aaryan Sawant, V.V. Kadam
                       for Respondent Nos. 1 to 3(a) to 3(e).
                       Mr. Sanjay D. Rayrikar, AGP for Respondent No. 4 – State.
                                                       ………….
                                                         CORAM : SHAILESH P. BRAHME, J.

                                                         DATE        : 10th SEPTEMBER, 2026.
                       P. C. :

                       .         Heard learned counsel for the parties.

                       2.        The petition is directed against the order dated 08.05.2026

                       granting stay to the award of Arbitrator dated 08.06.2023 subject to

                       depositing of 50% of compensation amount in the District Court within a

                       period of two months.

                       3.        Learned counsel Mr. Tejpal Ingale, appearing for respondent nos.1

                       to 3(a) to 3(e) - claimants has raised preliminary objection regarding

                       maintainability of the petition.     It is submitted that impugned order is



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passed below Exh.5, which was preferred under Section 9 of the

Arbitration and Conciliation Act is appealable under Section 37 of the Act

and, therefore, the present Writ Petition is not maintainable.

4.       While repealing the submissions, learned counsel for the petitioner

would advert my attention to Section 36(3) of the Act which enables the

party to file application for stay. It is submitted that in application Exh.5,

though Section 9 is quoted, it is in fact, under Section 36 of the Act.

5.       It is trite law that wrong mentioning of Section would not render

the proceedings illegal or not maintainable.           Award passed by the

competent        authority   was   subjected   to   challenge    in    arbitration

proceedings which culminated in Award on 08.06.2023.                  Against the

award, application under Section 34 has been preferred by the petitioner.

Application Exh.5 in its letter and spirit is under Section 36(3) of the Act.

I am of the considered view that impugned order is not appealable and

writ petition is rightly filed. The objection of the respondents stands

rejected.

6.       Learned counsel for the petitioner submits that fraud has been

played by the Arbitrator and criminal action has been set into motion

against him. FIR is lodged on 08.06.2023 and there is a report of A.C.B.

which would indicate involvement of the Arbitrator. It is submitted that



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the respondents – claimants have been unduly benefited.                If the

impugned order is sustained, the petitioner will face grave hardship in

depositing the amount which is awarded arbitrarily.       There are other

claimants also, who would resort to same course. It is submitted that the

petitioner has no objection for expediting the proceedings under Section

34 of the Act but direction to deposit 50% is onerous and unsustainable.

Learned Counsel for the petitioner would advert my attention to the

observations of the District Court in the impugned order granting liberty

to the claimants to apply for withdrawal of the amount.

7.       Learned counsel for the petitioner has relied upon the following

judgments.

(i)      Alkem Laboratories Ltd. Vs. Issar Pharmaceduticals Pvt. Ltd.
         (2024) SCC Online Bom 5978.
(ii)     National Collateral Management System Vs. Haryana Co-operative
         Supply, (2022) SCC Online P&H 4358.
(iii)    Popular Caterers Vs. Ameet Mehta & Ors. (2025) SCC Online SC
         3334.
(iv)     Lifestyle Equities C.V. Vs. Amazon Technologies, (2026) 3 SCC 641.
(v)      Sepco Electric Power Construction Corporation Vs. Power Mech
         Projects Ltd. (2022) SCC Online SC 1243.


8.       Learned counsel Mr. Ingale would tender on record common

judgment passed by this Court in the matters arising out of the self same

acquisition proceedings.     In those 20 matters, the District Judge had


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directed the petitioner to deposit 50% of the enhanced compensation.

Accordingly, the amount was deposited.        The approach of the petitioner

against the present respondents is stated to be discriminatory.             It is

candidly submitted that the respondents at present do not wish to receive

that amount as the proceedings are pending before the District Court.

9.       I have considered the writ petitions filed by the petitioners in case

of other claimants arising out of the same acquisition proceedings. The

facts of the present matters are identical with the matters decided by

common judgment dated 07.07.2026. In those matters also, the District

Judge directed the petitioner to deposit 50% of the amount. The self-

same course can be adopted in the present matter.

10.      My attention is adverted by learned counsel for the petitioner that

respondents – claimants were disbursed the amount and their claim for

enhancement is under consideration. Learned District Judge has made

passing observations that the claimants would be having liberty to

withdraw the amount if the separate applications are filed but that is not

the direction issued by the Court in the impugned order.                     The

apprehension of the learned counsel for the petitioner is misplaced.

11.      Though criminal law is set into motion against the erring Officer /

Arbitrator, the latest update of the criminal proceedings have not been



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brought before this Court. The equities can be balanced by directing the

petitioner to deposit the amount and withholding the same.

12.      I find that there has to be consistency in the orders passed by the

Court. No differential treatment can be given in the present matter. I

find no substance in the petition. The directions issued in the impugned

order needs to be complied with. The judgments cited by the petitioner

are on the point that award of arbitrator can be stayed under Section

36(2) without imposing any condition if exceptional case is made out or

it is obtained by fraud or corruption.        The petitioner has complied with

the condition in case of other claimants and disbursement is withheld.

Similarly, in the present case disbursement can be withheld.

13.      The Writ Petition is dismissed.

14.      It is clarified that Civil Miscellaneous Application No.72 of 2023

shall be decided along with others expeditiously on its own merits

without being influenced by the observations recorded by this Court.




                                                ( SHAILESH P. BRAHME, J. )




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