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2016 Supreme(Bom) 97
IN THE HIGH COURT OF JUDICATURE AT BOMBAY, NAGPUR BENCH
R.K. DESHPANDE, J.
Qureshi Brothers, Akhada Balapur, Taluka Kalamnuri – Appellant
Vs.
State of Maharashtra – Respondent
First Appeal No. 174 of 2002
Decided On : 2-2-2016
Advocate Appeared:
Shri Abhijeet Khare, Advocate, for Appellant.
Important Point – In a commercial transaction any delay in compensating losses shall attract commercial rate of interest.
Headnote:Arbitration and Conciliation Act, 1996 – Section 31 – Interest – Arbitrator awarded interest at the rate of 18% per annum which has been reduced by trial Court at the rate of Rs. 6% per annum – It was a commercial transaction and delay in compensating losses shall attract commercial rate of interest which could not have been denied for reason that Arbitrator has awarded huge amount of interest – There was no reason for Trial Court to reduce interest from 18% per annum to 6% per annum – Order passed by Trial Court to that effect needs to be set aside.
Result – Appeal Partly allowed.
R.K. DESHPANDE, J.
1. The Arbitrator awarded interest at the rate of 18% per annum, which has been reduced by the trial Court at the rate of Rs. 6% per annum from the date of filing of the suit till its realization.
2. The point for determination of this Court is as under:-
Whether the trial Court was right in reducing the rate of interest awarded by the Arbitrator?
3. In paragraph 21 of the judgment, the trial Court has clearly observed that, I find that the Arbitrator's award even on the point of interest cannot be set aside. In paragraph 23, it is observed that the decision of the Arbitrator about the interest of compensation is not erroneous and accordingly, the finding is recorded on Issue No. 4 in negative. Undisputedly, it was a commercial transaction and the delay in compensating losses shall attract the commercial rate of interest which could not have been denied for the reason that the Arbitrator has awarded huge amount of interest. In view of this, there was no reason for the trial Court to reduce the interest from 18% per annum to 6% per annum. The order passed by the trial Court to that effect needs to be set aside.
4. In the result, the appeal is allowed to the extent of setting aside the order of the trial Court reducing the rate of interest from 18% per annum to 6% per annum and it is held that the appellant-claimant shall be entitled to rate of interest as has been awarded by the Arbitrator in the award dated 31.05.1999. No order as to costs.
