Review Jurisdiction Cannot Be Used To Introduce New Factual Foundations Or Reopen Concluded Arbitral Awards: Karnataka High Court

"A review petition cannot be utilized to introduce a new factual foundation and thereby reopen the substantive rights that have already stood concluded. The jurisdiction of review is limited and cannot be converted into appellate jurisdiction so as to enable a party to raise a new case." Karnataka High Court, in a judgment dated 02 September 2026, held that a review petition cannot be invoked to reopen a concluded arbitral award by introducing fresh factual contentions that were never raised during the original adjudication.

A division bench comprising Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha observed that once a statutory award under the National Highways Act, 1956 (NH Act) attains finality, the acquiring authority cannot seek to modify it through administrative communications or by litigating new claims within a review proceeding.

The appellant, an owner of land measuring approximately 2021 square meters in Mandya District, saw his property acquired for the widening of NH-275. Following a dispute over compensation, a statutory Arbitrator passed an award on 21 September 2019, which recognized the converted residential nature of the land and enhanced the compensation payable. While the National Highways Authority of India (NHAI) initially sought to reopen the award via administrative communications to reduce their financial liability, the High Court had previously quashed these attempts in a writ petition. The NHAI then filed a review petition, successfully convincing the Single Judge to exclude 400 square meters of the acquired land from the compensation based on a condition in the original land conversion order.

The court was primarily called upon to determine whether the scope of review jurisdiction under the Code of Civil Procedure (CPC) permits a party to introduce new factual pleas to challenge a final arbitral award. It also addressed whether an administrative body can circumvent the finality of an arbitral determination by withholding compensation on grounds not raised during the statutory arbitration process.

Limited Scope of Review

The bench emphasized that the jurisdiction of review is strictly limited and cannot be conflated with appellate jurisdiction. By permitting the respondents to exclude 400 square meters of land based on a conversion order condition that was never presented before the Arbitrator, the Single Judge had essentially allowed a new case to be built. The court noted that if the respondents were aggrieved by the inclusion of this land, their remedy lay in challenging the arbitral award under the Arbitration and Conciliation Act, 1996 (A&C Act), which they failed to do.

Finality of Arbitral Awards

"Once the statutory Arbitrator had adjudicated the dispute and determined the compensation payable in respect of the acquired land and such determination had attained finality, the acquiring authority could not thereafter assume to itself the power to reopen or reconsider the determination by issuing an administrative communication."

The court underscored that the statutory scheme of the NH Act provides for a specific process of adjudication. Once the Arbitrator determines the compensation and that award attains finality, it is binding upon the parties. Allowing the NHAI to re-calculate compensation through administrative orders or belated review contentions would undermine the rule of law and the sanctity of arbitral proceedings.

Binding Precedent on Modification of Awards

"The Supreme Court in Project Director, National Highways Vs. M. Hakeem held that the Court exercising jurisdiction under Section 34 of the A&C Act does not possess a general power to modify an arbitral award, which reinforces the limited nature of jurisdiction available in respect of a concluded arbitral determination."

Citing the Supreme Court’s ruling in M. Hakeem, the bench clarified that even a court under Section 34 of the A&C Act cannot modify an award, let alone an administrative authority. Consequently, the High Court set aside the order passed in the review petition and restored the original mandate for the NHAI to disburse the full compensation as determined by the Arbitrator.

The High Court allowed the appeal, effectively reinforcing that finality in land acquisition compensation must be respected. Parties cannot be permitted to use the review process as a mechanism to rectify their own strategic failures to raise issues during the initial arbitral proceedings.

Date of Decision: 02 September 2026