The liability to pay interest after depositing the awarded amount in court and the interpretation of the relevant provisions of the Arbitration and Conciliation Act, 1996 were central legal points established in the given judgment.

Valmiki J. Mehta, J (Oral):

1. This petition under Article 227 of the Constitution of India is filed by the judgment debtor impugning the order of the executing court dated 26.7.2013 by which the executing court has granted interest to the respondent/decree holder @ 10% per annum from 25.5.2005 till 30.6.2012.

2. The issue before the executing court was whether the liability of the petitioner/judgment debtor to pay interest @ 10% per annum in terms of the Award for the post award period had ceased on account of depositing the amount on 25.5.2005 by the petitioner/judgment-debtor in an appeal filed against the order/judgment dated 04.1.2005 by which objections filed by the petitioner/judgment debtor under Section 34 of the Arbitration and Conciliation Act, 1996 were dismissed.

3. The aforesaid issue arose in the facts of the case where an Award dated 27.5.2003 was passed in favour of the respondent/decree holder for an amount of Rs.13,39,866/- @ 10% per annum pendent lite and future interest along with costs. The petitioner/judgment debtor filed objections to the Award under Section 34 of the Arbitration and Conciliation Act which were dismissed on 04.1.2005 and against which order an appeal was filed in this Court being FAO 52/2005. In this appeal, vide order dated 04.3.2005 while issuing notice the Court directed stay of the execution proceedings. The petitioner/judgment debtor as a condition for stay of the execution proceedings was directed to deposit the entire awarded amount with the trial court ie Rs. 23,93,779/- and petitioner/judgment-debtor deposited the said amount on 25.05.2005. Subsequently, on 04.8.2010, the appeal being FAO No.52/2005 was dismissed and thereafter vide order dated 20.4.2012, this Court directed release of the amount in favour of the respondent/decree holder, and which was released to the respondent/decree holder in terms of the order of the trial court dated 08.6.2012.

4. Whereas, the petitioner/judgment debtor claims that its liability to pay interest ceased from 25.5.2005 when the awarded amount was deposited in FAO No.52/2005 in this Court pursuant to the order dated 04.3.2005, the respondent/decree holder claims that it is entitled to interest till 30.6.2012.

5. The trial court by the impugned order dated 26.07.2013 has held that the respondent/decree holder will be entitled to interest in terms of the Award for the awarded amount post passing of the Award @ 10% per annum from 25.5.2005 till 30.6.2012 by placing reliance upon the judgment of the Supreme Court in the case of State of Rajasthan & Anr. Vs. J.K.Synthetics Ltd. & Anr. (2011) 12 SCC 518 decided on 04.7.2011, which holds that any person who is successful in securing an interim order must when the interim order is vacated restitute the benefit to the aggrieved person as if the interim order was not passed.

6. Learned counsel for the petitioner in support of her argument that no interest was payable although the Award directed payment of interest post passing of the Award @ 10% per annum places reliance upon the judgment of the Supreme Court in the case of H.P. Housing and Urban Development Authority & Anr. Vs. Ranjit Singh Rana, (2012) 4 SCC 505. The relevant paras of this judgment are paras 3, 6, 9, 10, 11 & 12 which read as under:-

“3. After remand, the Arbitrator considered the matter and passed the award on February 14, 2001. The Appellants filed objections against the award dated February 14, 2001. They also deposited the entire amount due under the award before the High Court on May 24, 2001. The objections tiled by the Appellants were ultimately rejected by the single judge of the High court on February 26, 2008. Against this order, intra- court appeal is side to be pending. The respondent, however, started execution of the Award dated February 14, 2001 by filing Execution Petition of August 12, 2008. The Appellants filed objections to the Execution petition.

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6. There is no dispute that the enti