NATIONAL HIGHWAYS AUTHORITYOFversusSAYEDABAD TEA COMPANY LTD. AND ORS.

                          [2019] 11 S.C.R. 725                            725


        NATIONAL HIGHWAYS AUTHORITYOF INDIA                               A
                                  v.
        SAYEDABAD TEA COMPANY LTD. AND ORS.
                (Civil Appeal Nos. 6958-6959 of 2009)
                         AUGUST 27, 2019                                  B
 [N. V. RAMANA, MOHAN M. SHANTANAGOUDAR AND
                AJAY RASTOGI, JJ.]
       National Highways Act, 1956: s.3G(5) – Arbitration and
Conciliation Act 1996 – s. 11 – Appointment of arbitrator –
                                                                          C
Application u/s. 3G(5) of the 1956 Act for appointment of an
Arbitrator by the Central Government – Allegation that Central
Government did not respond to the request for appointment –
Thereafter, application filed u/s. 11 of the 1996 Act – Maintainability
of application u/s. 11 of the 1996 Act, in view of s. 3G(5) of the
1956 Act – Held: When the special law sets out a self-contained           D
code, the application of general law would impliedly be excluded –
Scheme of 1956 Act, being a special law enacted for the purpose
and for appointment of an arbitrator by the Central Government
u/s. 3G(5) of the 1956 Act and sub-section (6) of s.3G itself clarifies
that subject to the provisions of the Act 1956, the arbitrator may
                                                                          E
take recourse in adjudicating the dispute invoking the provisions
of 1996 Act for the limited purpose – Thus, in view of the power
being vested exclusively with the Central Government to appoint
an Arbitrator u/s 3G(5) of the Act 1956, the application filed u/s
11(6) of the Act 1996 for appointment of an Arbitrator not
maintainable and provisions of the Act, 1996 could not be invoked         F
for the purpose – Order by the High Court appointing an Arbitrator
invoking s. 11 of the 1996 Act, set aside – Arbitrator so appointed
by the Central Government may adjudicate and decide the dispute.
      Allowing the appeals, the Court
      HELD: 1.1 The National Highways Act, 1956 is a                      G
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
                                                                          H
                                 725
726            SUPREME COURT REPORTS                     [2019] 11 S.C.R.


A     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
B
      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,
C     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
D
      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,
E     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
F     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
G     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
H
       NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                          727
        SAYEDABAD TEA COMPANY LTD. AND ORS.

Act, 1956 clearly stipulates that the provisions of the Act, 1996      A
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          B
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          C
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              D
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       E
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      F
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   G
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
                                                                       H
728            SUPREME COURT REPORTS                     [2019] 11 S.C.R.


A     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
B     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 respondent-
      applicant and the Central Government shall consider and appoint
C
      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
D     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
E     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.
F           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.
G
                             Case Law Reference
      [2013] 2 SCR 470               held inapplicable       Para 15
      [2008] 4 SCR 822               referred to             Para 22

H
       NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                                 729
        SAYEDABAD TEA COMPANY LTD. AND ORS.

       CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 6958-                  A
6959 of 2009
       With
       Civil Appeal Nos. 6965-6966 of 2009.
       From the Judgment and Order dated 06.07.2007 and 27.08.2007
of the High Court at Calcutta in A.P. No. 77 of 2007 and G.A. No. 2563        B
of 2007
       Vikas Goel, Abhishek Kumar, Rahul Shyam Bhandari, Ms. Arushi
Gupta, Ms. Bhavya Vijay T., A. Siva Kumar, Advs. for the Appellant.
       Prashant Bhushan, Lal Pratap Singh, Ms. Vivya Nagpal, Umesh
Pratap Singh, Govind Jee, Ms. N. Annapoorani, Advs. for the                   C
Respondents.
       The Judgment of the Court was delivered by
       RASTOGI, J.
       1. The moot question which arises before us is whether the
application under Section 11 of the Arbitration and Conciliation Act,         D
1996(hereinafter being referred to as “Act 1996”) is maintainable in
view of Section 3G(5) of the National Highways Act, 1956 (hereinafter
being referred to as “Act 1956”) which provides for appointment of an
Arbitrator by the Central Government.
      2. The relevant seminal facts are that the subject land comprised       E
in “Sayedabad Tea Estate” situated at Mouza Purba Madati, J.L. No.
108, Police Station Phansidewa, Dist. Darjeeling measuring 5.08 acres
was acquired by the appellant (National Highways Authority of India) in
exercise of its powers under Section 3(D) of the Act 1956 vide notification
dated 22nd November, 2005 under L.A.P. Case No. 4/2004-05 for the
                                                                              F
purpose of construction of the highways.
       3. The Act, 1956 is a comprehensive code in itself and a special
legislation enacted by the Parliament for acquisition and for determining
compensation and its disbursement where there are several claimants
over the amount deposited towards compensation determined by the
competent authority in accordance with the mechanism provided under           G
Section 3G of the Act, 1956. If the amount so determined by the
competent authority under sub-section(1) or sub-section (2) of Section
3G 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 under Section 3G(5) of the Act.           H
730            SUPREME COURT REPORTS                          [2019] 11 S.C.R.


A     While determining the amount of compensation under sub-section(1) or
      sub-section(5), it is the duty of the Arbitrator to take into consideration
      the relevant pointers envisaged under sub-section(7) of Section 3G of
      the Act, 1956. Where the amount determined by the Arbitrator is in
      excess of the amount determined by the competent authority under Section
      3G of the Act, 1956, the Arbitrator may, at its discretion, award interest
B
      at nine per cent per annum on the excess amount under sub-section (5)
      of Section 3H from the date of taking possession under Section 3D till
      the date of actual deposit.
            4. The extract of the sections of the Act 1956 relevant for the
      purpose are as under:-
C
            “3G. Determination of amount payable as compensation.—
            (1) ………
            (2) ………

D           (3) ………
            (4) ………
            (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
E               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.
F           (7) The competent authority or the arbitrator while determining
                the amount under sub-section (1) or sub-section (5), as the
                case may be, shall take into consideration—
                (a) the market value of the land on the date of publication of
                    the notification under section 3A;
G
                (b) the damage, if any, sustained by the person interested at
                    the time of taking possession of the land, by reason of the
                    severing of such land from other land;
                (c) the damage, if any, sustained by the person interested at
                    the time of taking possession of the land, by reason of the
H
    NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                                     731
SAYEDABAD TEA COMPANY LTD. AND ORS. [RASTOGI, J.]

              acquisition injuriously affecting his other immovable            A
              property in any manner, or his earnings;
          (d) if, in consequences of the acquisition of the land, the person
              interested is compelled to change his residence or place
              of business, the reasonable expenses, if any, incidental to
              such change.                                                     B
      3H. Deposit and payment of amount.—
      (1) …….
      (2) …….
      (3) …….                                                                  C
      (4) …….
       (5) Where the amount determined under section 3G by the
arbitrator is in excess of the amount determined by the competent
authority, the arbitrator may award interest at nine per cent, per annum
                                                                               D
on such excess amount from the date of taking possession under section
3D till the date of the actual deposit thereof.
      (6) ……
      …
      …                                                                        E

      12…………”
       5. In the instant case, the respondent-applicant being dissatisfied
with the award of compensation determined by the competent authority
under sub-section(1) of Section 3G of the Act, 1956 filed application for      F
appointment of an Arbitrator in terms of Section 3G(5) to the Central
Government on 8th December, 2006. As alleged, since the Central
Government has not responded to his request for appointment of an
Arbitrator in terms of letter dated 8th December, 2006 within a period of
30 days from receipt of the request, application was filed on 7th March,
2007 to the Chief Justice/his designate for appointment of an Arbitrator       G
invoking Section 11(6) of the Act, 1996. It reveals that the Arbitrator
was appointed by the Central Government sometime in April 2007.
      6. The High Court of Calcutta taking note of the fact that the
Arbitrator has been appointed by the Central Government under Section
                                                                               H
732             SUPREME COURT REPORTS                          [2019] 11 S.C.R.


A     3G(5) of the Act, 1956 after the respondent-applicant had moved an
      application to the Chief Justice/his Designate invoking its power under
      Section 11(6) of the Act, 1996 held that right of appointment of the
      Arbitrator by the Central Government stands forfeited as it failed to
      appoint the Arbitrator until filing of the application under Section 11(6) of
      the Act, 1996 before the High Court of Calcutta and appointment of
B
      Arbitrator during the pendency of proceedings, cannot be said to be a
      valid appointment and hence referred the matter to be placed before the
      Chief Justice for naming an Arbitrator vide its Order dated 6th July, 2007.
             7. Immediately after passing of the order dated 6th July, 2007, the
      appellant moved an application for review and it was brought to the
C     notice of the High Court that the Act, 1956 being a special enactment
      laying down a procedure for appointment of an Arbitrator where the
      power is being exclusively vested with the Central Government under
      Section 3G(5) of the Act, 1956, the application made under Section 11(6)
      of the Act, 1996 is not maintainable but this was not considered to be a
D     valid reason for invoking review jurisdiction by the High Court as
      envisaged under Order 47 Rule 1 read with Section 114 of Code of Civil
      Procedure and the review application was dismissed vide Order dated
      August 27, 2007.
              8. It may be relevant to note that the sole Arbitrator (Justice P.N.
E     Sinha) who was appointed by the High Court of Calcutta pursuant to
      Order dated 6th July, 2007 under Section 11 of the Act, 1996 before
      initiation of the proceedings, sent the letter of his recusal dated 25th
      January, 2008 (Annexure P-12).
             9. It is informed to this Court that the Arbitrator who was appointed
F     by the Central Government under Section 3G(5) of the Act, 1956 in
      April, 2007 could not have proceeded after the intervention was made
      by the High Court of Calcutta in appointing the sole Arbitrator under
      Section 11(6) of the Act, 1996. That for all practical purposes, the dispute
      raised by the respondent-applicant aggrieved by the compensation
      awarded under sub-sections(1) or (2) of Section 3G of the Act, 1956 has
G     so far not been adjudicated because of the competence of the authority
      in appointing the Arbitrator remain pending decision as to whether it
      would be under the Act, 1956 or Act, 1996 as invoked by the High Court
      of Calcutta under the order impugned before us.

H
    NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                                       733
SAYEDABAD TEA COMPANY LTD. AND ORS. [RASTOGI, J.]

       10. Mr. Vikas Goel, learned counsel for the appellant submits that        A
the Act 1956 being a special enactment is a code in itself provide not
only the procedure of acquisition but also the mode of determining
compensation by the competent authority and any person, if aggrieved
by the compensation determined under sub-sections(1) or (2) of Section
3G of Act 1956 can certainly move an application for appointment of an
                                                                                 B
Arbitrator to which a Central Government is under obligation to appoint
under Section 3G(5) of the Act 1956. But before the matter could be
proceeded, the respondent-applicant approached the High Court by filing
an application under Section 11(6) of the Act 1996 which was not
maintainable and this being the settled principles of law that the special
law prevail over the general law, the provisions of Act 1996 could not           C
have been invoked at least for the appointment of an Arbitrator in
abrogating the power of the Central Government in appointing the
Arbitrator as contemplated under Section 3G(5) of Act 1956 and this
being an apparent error in law committed by the High Court needs to be
interfered by this Court.
                                                                                 D
       11. In support of his submission, learned counsel for the appellant
has placed reliance on the recent judgment of two Judges’ Bench of this
Court in General Manager (Project), National Highways and
Infrastructure Development Corporation Ltd. Vs. Prakash Chand
Pradhan & Ors. passed in Civil Appeal No. 5250 of 2018 decided on
16th May, 2018 and taking assistance thereof submits that the order passed       E
by the High Court of Calcutta in the appointment of an Arbitrator under
Section 11(6) of Act 1996 is not legally sustainable and both the Orders
passed by the High Court, i.e. 6th July, 2007 and 27th August, 2007 deserves
to be quashed and set aside.
       12. Per contra, Mr. Prashant Bhushan, learned counsel for the             F
respondents, while supporting the order passed by the High Court of
Calcutta impugned in the instant proceedings submits that sub-section(6)
of Section 3G clearly postulates that subject to the provisions of the Act
1956, the provisions of Act 1996 shall apply to every arbitration under
the Act, 1956. If the authority to whom application was filed for                G
appointment of an Arbitrator under Section 3G(5) of Act, 1956 has failed
to discharge its obligations within 30 days of presentation of the application
which indisputedly was December, 2006 or until filing of the application
for appointment of an Arbitrator to the Chief Justice/his Designate under
Section 11(6) of the Act, 1996 i.e. 7th March, 2007, the respondent was
                                                                                 H
734               SUPREME COURT REPORTS                        [2019] 11 S.C.R.


A     justified in taking recourse to sub-section(6) of Section 3G of Act, 1956
      for appointment of an Arbitrator under Section 11(6) of Act, 1996.
             13. Learned counsel further submits that the appellant under the
      Act, 1956 has forfeited its right to appoint an Arbitrator after presentation
      of the application under the Act, 1996 before the High Court of Calcutta
B     and in the given circumstances, there was no legal impediment before
      the High Court of Calcutta in appointment of an Arbitrator invoking
      Section 11(6) of Act 1996 and in support of his submission placed reliance
      on the judgment of this Court in Deep Trading Company Vs. Indian
      Oil Corporation and Others1.

C            14. We have heard learned counsel for the parties and with their
      assistance perused the material available on record.
             15. At the very outset, we may notice that the two Judge Bench
      of this Court in the recent judgment in General Manager (Project),
      National Highways and Infrastructure Development Corporation
      Ltd. case(supra), while dealing with the scope of sub-sections (5) and
D
      (6) of Section 3G of the Act 1956 with reference to Section 11 of the
      Act, 1996 has held that the Act 1956 being a special enactment and
      Section 3G in particular provides an inbuilt mechanism for appointment
      of an Arbitrator by the Central Government. Hence Section 11 of the
      Act, 1996 has no application and the power is exclusively vested with
E     the Central Government under Section 3G(5) of the Act, 1956 for
      appointment of an Arbitrator and if the Central Government does not
      appoint an Arbitrator within a reasonable time, it is open for the party to
      avail the remedy either by filing a writ petition under Article 226 of the
      Constitution of India or a suit for the purpose but the remedy of Section
      11 of Act 1996 is not available for appointment of an Arbitrator.
F
             16. We are in full agreement with the legal position stated by a
      two Judge Bench of this Court in General Manager (Project), National
      Highways and Infrastructure Development Corporation Ltd.
      case(supra) but like to add further that the Act, 1956 has been enacted
      under Entry 23 of the Union List of the Seventh Schedule of the
G     Constitution with the exclusive power to legislate with respect to
      highways, which are declared to be national highways by or under law
      by the Parliament. It 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
      1
H         2013(4) SCC 35
    NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                                       735
SAYEDABAD TEA COMPANY LTD. AND ORS. [RASTOGI, J.]

and its adjudication by the Arbitrator to be appointed by the Central            A
Government and if still remain dissatisfied, by the Court of law.
       17. 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           B
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.
                                                                                 C
       18. 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.               D
       19. 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              E
(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 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                   F
Government as envisaged under sub-section (5) of Section 3G of Act
1956, Section 11 of the Act 1996 has no application.
        20. 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            G
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
                                                                                 H
736               SUPREME COURT REPORTS                          [2019] 11 S.C.R.


A     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.
            21. In our considered view, the High Court of Calcutta was not
      holding its competence to appoint an Arbitrator invoking Section 11 of
B     Act, 1996.
             22. This very question earlier arose before this Court whether the
      application under Section 11(6) of the Act 1996 is maintainable in view
      of statutory provisions of Electricity Act, 2003 adjudicating the dispute
      between the licencees and the generating companies of the special
C     enactment and Section 86(1) of the Electricity Act, 2003 in particular,
      this Court in Gujarat Urja Vikash Nigam Ltd. Vs. Essar Power
      Limited2 in para 28 observed as under:-
               28. Section 86(1)(f) is a special provision and hence will override
               the general provision in Section 11 of the Arbitration
D              and Conciliation Act, 1996 for arbitration of disputes between the
               licensee and generating companies. It is well settled that the special
               law overrides the general law. Hence, in our opinion, Section 11 of
               the Arbitration and Conciliation Act, 1996 has no application to
               the question who can adjudicate/arbitrate disputes between
               licensees and generating companies, and only Section 86(1)(f) shall
E              apply in such a situation.
            23. We are also of the considered opinion that 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
F     appointment of an Arbitrator was not maintainable and provisions of the
      Act, 1996 could not be invoked for the purpose.
             24. The submission of learned counsel for the respondents 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,
G     1956 within a period of 30 days, the High Court of Calcutta alone was
      holding its competence to appoint an Arbitrator and application was
      submitted by the respondent-applicant on 7th March, 2007 the right of
      appointment of an Arbitrator by the Central Government stands forfeited
      and has relied on the Judgment of this Court in Deep Trading Company
      2
H         2008(4) SCC 755
    NATIONAL HIGHWAYS AUTHORITYOF INDIA v.                                     737
SAYEDABAD TEA COMPANY LTD. AND ORS. [RASTOGI, J.]

case (supra) is of without substance for the reason that there is no           A
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
                                                                               B
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         C
has no application. The judgment in Deep Trading Company
case(supra) on which learned counsel has placed reliance is of no
assistance for the reason firstly that controversy there was not in
reference to the appointment of an Arbitrator under the special enactment
as in the instant case under Act 1956 and secondly, if one party fails to
                                                                               D
exercise its power of appointment in terms of Clause 29 of the agreement
in vogue, the provisions of Act 1996 would apply and the question for
consideration was whether the rights of the party stand forfeited to appoint
an Arbitrator after the party has invoked Section 11(6) of the Act 1996
which, as already observed by us, is not the question for consideration in
the instant case.                                                              E
       25. It is indeed true that 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         F
by now, we deem it appropriate to observe that there is no need to file
any application by the respondent-applicant 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, we
consider it appropriate to further observe that the Arbitrator so appointed    G
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.

                                                                               H
738                SUPREME COURT REPORTS                      [2019] 11 S.C.R.


A           26. The appeals accordingly succeed and are allowed. The orders
      passed by the High Court dated 6th July, 2007 and 27th August, 2007 are
      hereby set aside. The Arbitrator may be appointed by the appellants in
      terms indicated above. No costs.
              27. Pending application(s), if any, stand disposed of.
B
      Nidhi Jain                                                   Appeals allowed.




C




D




E




F




G




H