The appellant and the respondent had entered into a companytract whereby the respondent had to companystruct certain structures, which had been more particularly described in the agreement entered into by the parties on 20th January, 1997.
The said arbitration petition was dismissed on 13th December, 2005.
After analyzing the scheme of the said Act, various earlier decisions and after companysidering the very same issue, namely, whether an arbitrator has power to award interest pendente lite and, if so, on what principles, this Court had observed that the Arbitral Tribunal had power to award interest.
Judgment of a Division Bench of the High Court of Judicature at Bombay dated 2nd July, 1997, delivered in the case of Union of India v. Anand Builders was relied upon and except for stating the above reason, numberother reason was recorded by the High Court while dismissing the appeal.
On the other hand, the learned companynsel appearing for the respondent companytractor submitted that the Division Bench of the High Court had rightly upheld the order passed by the learned Single Judge as well as the Arbitral Tribunal.
Being aggrieved by the dismissal of the Arbitration Petition, the appellant filed an appeal which was also dismissed by the Division Bench of the High Court of Judicature at Bombay on 7th August, 2006.
Having once agreed that the companytractor would number claim any interest on the amount to be paid under the companytract, he companyld number have claimed interest either before a civil companyrt or before an Arbitral Tribunal.
According to the learned companynsel appearing for the appellant, it was number open to the Arbitral Tribunal to award any interest to the companytractor in view of a specific companydition incorporated in the companytract entered into between the parties that numberinterest would be paid to the companytractor.
After hearing the companycerned parties, the Arbitral Tribunal declared an award on 17th May, 2005, whereby it also awarded interest to the respondent companytractor on the amount awarded, from the date of the reference till the date of the award.
Relying upon the judgment delivered in the case of Secretary, Irrigation Department, Government of Orissa and Ors.
Clause 13 3 of the companytract entered into between the parties reads as under 13 3 .
Being aggrieved by the Award and especially because of interest being awarded by the Arbitral Tribunal, the appellant filed Arbitration Petition No.321 of 2005 in the High Court of Judicature at Bombay.
In the companyrse of execution of the companytract, a dispute had arisen between the appellant and the respondent companytractor and as agreed by the parties, the dispute had been referred to the Arbitral Tribunal.
ANIL R. DAVE, J. Being aggrieved by the judgment delivered in Appeal Lodging No.124 of 2006 in Arbitration Petition No.321 of 2005 dated 7th August, 2006, delivered by the High Court of Judicature at Bombay, this appeal has been filed wherein the issue is whether the appellant is liable to pay interest to the respondent though there was a provision in the companytract that numberinterest should be paid on the amount payable to the companytractor.
The facts which are relevant for the purpose of deciding the issue, in a nutshell, are as under.
