The court upheld that future interest on awarded amounts includes prior interest, and security deposits must be deducted from awarded amounts per the arbitral tribunal's directive.

JUDGMENT

[Video Conferencing]

Vibhu Bakhru, J. (ORAL)--Mr Mata, learned senior counsel appearing for the Judgment Debtors in these petitions has raised two issues pertaining to the calculation of the amount due and payable to the Decree Holder. First, he submits that the Decree Holder has calculated future interest on the pendente lite interest awarded by the learned Arbitrator and the same would amount to providing compound interest, which cannot be inferred from the plain language of the impugned award. He submitted that a plain reading of the award does not indicate that the Arbitral Tribunal has awarded any such compound interest. Second, he submits that an aggregate of Rs.2.45 crores, which was deposited as security deposits against the loans extended to the respondent were lying with the Decree Holder. And, the Judgment Debtors were entitled to credit for the said deposits on the date when the same were made and in any event on the date when the Decree Holder had foreclosed the loans. He referred to paragraph 125 of the Arbitral Award in support of his contention that the Arbitral Tribunal had also accepted the said position and had, accordingly, directed that the adjustment be made on account of the security deposits which were paid by the respondents (Judgment Debtors) while calculating the loan amounts.

2. Mr Nagesh, learned senior counsel appearing for the Decree Holder countered the aforesaid submissions. He drew the attention of this Court to the operative part of the arbitral award. He pointed out that the Arbitral Tribunal had specifically awarded future interest not only on the amount as specified but also on the interest thereon. Insofar as the appropriation of security deposit is concerned, he drew the attention of this Court to paragraph 184 of the Arbitral Award, wherein the Arbitral Tribunal had specifically directed that the credit of Rs.2.45 crores be given to the respondents (Judgment Debtors) and the same amount be deducted from the total awarded amount. He submitted that there was no ambiguity in the Arbitral Award and the adjustment of the said amount was required to be made from the awarded amount. He also submitted that the Judgment Debtors cannot now seek to raise fresh issues at the stage of enforcement of the Arbitral Award and this Court cannot go behind the award to adjudicate any such contentious issues. He also submitted that the parties had exchanged various calculations during the proceedings relating to the application filed by the Judgment Debtors for impugning the arbitral award and none of the calculations circulated by the Judgment Debtors in those proceedings reflected that the sum of Rs.2.45 crores is required to be adjusted in any manner except from the awarded amount. He submitted that the Judgment Debtors are precluded at this stage from raising any such issue.

3. I have heard the learned counsel for the parties.

4. The first question to be addressed is whether Arbitral Tribunal has awarded future interest on the pendente lite and pre-reference interest and if so, whether the same is permissible.

5. It is seen that the Arbitral Award is a common award in respect of disputes arising from ten loan agreements. The Arbitral Tribunal had after returning the findings of the contentious issues set out the amounts payable in respect of each loan agreement. The operative part of the award is in similar terms (except that the amounts awarded in respect of loan agreements differ in each case). At this stage, to examine the award, it is relevant to refer the operative part of one such loan agreement