An arbitrator has no jurisdiction to award interest up to the date of reference or any pendente lite interest unless there is an agreement between the parties to pay interest, the terms of reference specifically include the matter of payment of interest, or there is a substantive law or equity that allows for the award of interest.

S.B.Sinha, J.

1. The Miscellaneous appeal arises out of order dated 9-8-1991 passed bv Shri S.P. Sinha, Subordinate Judge, Saraikella in Misc. Judicial Case No. 4 of 1985 making fan award dated 2-11-1983, the rule of Court.

2. The fact of the matter lies in a very narrow compass.

3. A works contract was awarded by the appellant to the respondent in the year 1990 for construction of a building for the purpose of hostel workshops, class-rooms and administrative building.

4. In the year 1961, the construction works commenced and it was completed in the year 1963. Thereafter, a fresh contract job was given to the respondent by the appellant which was also completed by it by the middle of 1965.

5. According to the appellant, the value of contract work was to be extent of Rs. 40,00,000 only whereas the respondent had been paid a sum of Rs. 52,00,000.

6. According to the appellant, as the money for executing the said contract job was provided for by the Central Government, it directed the PWD authorities of the State of Bihar to take measurements of the work done by the respondent; pursuant whereof, the works done by the respondent were checked up by the PWD department of the State of Bihar and valuation of the buildings erected by the respondent was mad; and it was reported that the same was Rs. 50,00,000.

7. After a prolonged deliberations, in December, 1970, it was decided to appoint an Arbitrator to settle the disputes and pursuant to the said arbitration agreement, Sri D.N. Jha, retired Chief Engineer PHED, Government of Bihar was appointed the sole Arbitrator. The terms of reference to the Arbitrator were:-

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1. To pass orders on the genuineness of the consolidated agreement signed by the principal Secretary of the R.I.T. and the representative of the firm.

2. To fix up the recovery rate of mild steel which has not been included in the agreement.

3. To get the final bills of each group of buildings prepared after verifying and getting the detail measurements entered in M. Books.

4. To fix up the rates for items of works done which are not included in the agreements and such items of claims that have already been entered and recommended in the claim book by the then executive Engineer and the Assistant Engineer Incharge of the work.

5. To pass orders and fix up rates for claim items not entered or mentioned in the claim book but given in writing by the contractor.

6. To pass orders on counter claims to be put up by the R.I.T.

7. To pass order on the hand receipts in which the contractor has mentioned that forgery regarding issue of materials has been made.

8. To pass orders on any items of claims submitted after by the con tractor or by the R. I. T.

9. To decide any type of issue concerning the work 10. To give awards.

8. The aforementioned Arbitrator submitted its award. By reason of the award, inter alia, interest payable by the appellant to the respondent on various amounts awarded were directed to be paid, which are as follows:-

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1. Interest is payable on Rs. 1,32,848.00 from 1-1-1965 to the date of payment at the rate of 6.1/4% per annum.

2. Interest is payable on Rs. 1,65,838.00 from 1-1.1965 to the date of payment at the rate of 6.1/4 % per annum.

3. Interest is payable on Rs. 1,26,288.00 from 1-1-1965 to the date of payment at the rate of 6.1/4% per annum.

4. Interest is payable on Rs. 28,746.00 from 1-1-1965 to the date of the payment at the rate of 6-1/4% per annum (kept back amount).

5. Interest is payable on 1,14,990/ 22,218) Rs. 1,37,208.00 from 1-1-1965 to the date of payment at the rate of 6-1/4% per annum, (interim award of group BCF).

6. Interest is payable on the balance security deposit of Rs. 88,296/ from 1-7-64 to the date of payment at the date of refund at the rate of 6.1/4% per annum.

In view of the inordinate delay which has been occurred in payment for no fault of the contractor payment of final award must be made within ninety days from this date (2-11-1983) failing which-the rate of interest