This case revolves around the National Highway Authority of India’s (NHAI) acquisition of land belonging to Sayedabad Tea Estate for the construction of a national highway. The owners of the tea estate contested the acquisition, raising concerns about the compensation offered and the impact on their operations. As negotiations failed, the estate initiated arbitration proceedings, challenging the process and seeking better compensation.
The Supreme Court ruled that the land acquisition process was carried out legally and in the public interest. It emphasized that while public infrastructure projects are critical, the affected parties must receive fair compensation. The Court upheld the arbitration clause, stating that disputes related to compensation and acquisition can be arbitrated.
This judgment is significant for infrastructure development in India. It balances the need for public infrastructure expansion with the rights of private landowners, reinforcing that public interest projects must also protect individual rights.
Arbitration was upheld as an appropriate forum for resolving such disputes, ensuring that conflicts over land acquisition are addressed fairly and efficiently.