ARBITRATION AND CONCILIATION ACT, 1996 — Ss.34 & 36(2) — Execution of arbitral award — National Highways land acquisition compensation — Enhanced compensation awarded by Arbitrator under National Highways Act — Challenge to arbitral award under S.34 accompanied by stay application — Stay application remaining pending for long period — Meanwhile decree-holder initiating execution proceedings and attachment order passed — Executing Court proceeding on ground that award remained unstayed — High Court interference under Art.227 — Held, though arbitral award remains executable unless stayed by competent Court, application seeking stay is required to be considered expeditiously to balance rights of parties and avoid proceedings under S.34 becoming infructuous — Further execution proceedings stayed subject to deposit of one-third execution amount. (Arbitration and Conciliation Act, 1996, Ss.34 & 36(2) — National Highways Act, 1956, S.3-G(5) — Constitution of India, Art.227)

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AP HIGH COURT HELD THAT

ARBITRATION AND CONCILIATION ACT, 1996 — Ss.34 & 36(2) — Execution of arbitral award — National Highways land acquisition compensation — Enhanced compensation awarded by Arbitrator under National Highways Act — Challenge to arbitral award under S.34 accompanied by stay application — Stay application remaining pending for long period — Meanwhile decree-holder initiating execution proceedings and attachment order passed — Executing Court proceeding on ground that award remained unstayed — High Court interference under Art.227 — Held, though arbitral award remains executable unless stayed by competent Court, application seeking stay is required to be considered expeditiously to balance rights of parties and avoid proceedings under S.34 becoming infructuous — Further execution proceedings stayed subject to deposit of one-third execution amount.
(Arbitration and Conciliation Act, 1996, Ss.34 & 36(2) — National Highways Act, 1956, S.3-G(5) — Constitution of India, Art.227)

Execution proceedings — Pendency of S.34 petition — Mere filing of petition under S.34 does not operate as automatic stay of arbitral award — However, prolonged non-disposal of stay application while execution proceeds may justify supervisory interference by High Court.

Facts :
Award dated 23.05.2016 was passed by Competent Authority under National Highways Act determining compensation for acquired land. On reference under Section 3-G(5) of National Highways Act, Arbitrator enhanced compensation in favour of decree-holder by award dated 02.05.2019. National Highways Authority of India challenged arbitral award by filing petition under Section 34 of Arbitration and Conciliation Act along with stay application, which remained pending. During pendency thereof, decree-holder initiated execution proceedings and Executing Court passed attachment order dated 05.02.2026 observing that execution could proceed in absence of stay order. Aggrieved thereby, revision under Article 227 was filed. Paras 4 to 7.

Held :
Under Section 36(2) of Arbitration and Conciliation Act, arbitral award becomes executable unless stayed by order of Court. However, once application seeking stay of award is filed, same deserves expeditious consideration so as to balance rights of parties and avoid challenge proceedings under Section 34 becoming infructuous. Para 8.

Accordingly, High Court directed XI Additional District Judge, Gudivada, to dispose of stay application expeditiously, preferably within four weeks, and ordered that further execution proceedings pursuant to award and attachment order shall remain stayed subject to deposit of one-third amount under execution within two weeks. Paras 9 and 10.