Punjab & Haryana High Court Sets Aside Rejection of Section 3H(4) Application; Holds Competent Authority Must Refer Apportionment Dispute to Civil Court Even After Disbursement of Compensation

Case Name: Balwinder Singh and Others v. State of Punjab and Others

Date of Judgment: 15 January 2026

Citation: CWP-20675-2024

Bench: Hon’ble Mr. Justice Harkesh Manuja

Held: The Punjab and Haryana High Court held that once a specific dispute regarding apportionment of compensation is raised under Section 3H(4) of the National Highways Act, 1956, the competent authority is duty-bound to refer the dispute to the Principal Civil Court of Original Jurisdiction, notwithstanding the fact that compensation has already been disbursed. The Court held that the statute does not permit the competent authority to decline reference merely on the ground of prior release of compensation.

Summary: The writ petition challenged an order dated 23.01.2024 passed by the competent authority rejecting the petitioners’ application under Section 3H(4) of the National Highways Act, 1956. The petitioners, along with private respondents, were co-owners of land measuring 24 kanals and 14 marlas situated in village Dhan Singh Khana, District Bathinda. Out of the acquired land measuring approximately 10 kanals and 9 marlas, the petitioners contended that compensation had been released to them only for 2 kanals and 1 marla, despite their larger ownership share.

The petitioners submitted that a clear dispute existed regarding apportionment of compensation, which required adjudication by the civil court. It was argued that the competent authority exceeded its jurisdiction by rejecting the application on the sole ground that compensation had already been released, as the authority had no power to decide apportionment disputes.

The private respondents opposed the petition, contending that once compensation stood disbursed, no occasion survived for invoking Section 3H(4) and that the competent authority was justified in refusing to make a reference.

The High Court found merit in the petitioners’ submissions. It held that the existence of a dispute regarding apportionment itself triggers the statutory obligation under Section 3H(4) to make a reference to the Principal Civil Court of Original Jurisdiction. The Court observed that neither the language of the provision nor its scheme suggests that disbursement of compensation bars such a reference. The reasoning adopted by the competent authority was held to be unsustainable in law.

Decision: The writ petition was allowed. The impugned order dated 23.01.2024 was set aside. The competent authority was directed to refer the apportionment dispute to the Principal Civil Court of Original Jurisdiction within one month. In case of non-compliance, the competent authority was to be held personally liable to pay costs of ₹1 lakh, to be borne from his own pocket and not from the State exchequer.