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M. R. SHAH, B. V. NAGARATHNA
Indian Oil Corpn. Limited – Appellant
Versus
U. B. Engineering Limited – Respondent
ORDER
1. Leave granted.
2. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court of Punjab and Haryana at Chandigarh in FAO Nos. 2345 and 4000 of 2006 by which the High Court has modified the award passed by the sole Arbitrator to the extent awarding the interest @ 18% post-Award only upon the principal amount awarded and even reducing the rate of interest from 18% p.a. from 9% p.a., the original Claimant-IOC has preferred the present Appeals.
3. The issue involved in the present Appeals lies in a very narrow compass. The dispute was referred to the sole Arbitrator. The appellant herein-original Claimant submitted the claim and even the counter-claim was submitted on behalf of the respondent. Ultimately, the learned Arbitrator awarded a sum of Rs.3,08,32,448.30 towards the principal claim and Rs. 2,27,58,137.08 towards the interest. The learned Arbitrator awarded the interest from the date of the claim till the award @ 18% p.a. Thus, the learned Arbitrator awarded a total sum of Rs.5,35,91,262.00. In appeal by the respondent, the High Court has observed and held that the appellant-original Claimant shall be entitled to the interest only upon
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Arbitrator has discretion to grant post-award interest – If Arbitrator does not grant post-award interest, award holder is entitled to post-award interest at eighteen percent.
Arbitral Tribunal's power to grant interest for the period post award till realization is subject to the discretion only in respect to the rate as it is the mandate of the law to grant such interest ....
Award of interest by Arbitrator – When discretion is vested to Arbitral Tribunal to award interest at a rate which it deems reasonable, then a duty would be cast upon Arbitral Tribunal to give reason....
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