Point of Law: Section 31(7) of the Arbitration and Conciliation Act, 1996 which provides for 18% of interest per annum from date of award till date of payment. Worthwhile it would be to refer to Section 31(7) of Act which provides that “unless otherwise as agreed by the parties, where and in so far as tribunal award is for payment of money, arbitral tribunal may include in sum for which the award is made interest, at such rate as it deems reasonable, on whole or any part of money, for whole or any part of period between date on which the cause of action arose and date on which award is made.”

JUDGMENT :

Sonia Gokani, J.

1. The appellant is the original applicant who is aggrieved and dissatisfied with the order dated 14.07.2015 delivered by the learned District and Sessions Judge, Gandhinagar rejecting the Civil Misc. Appeal No. 168 of 2014 preferred by the present appellant and confirming the award dated 23.04.2014 declared by the arbitrator.

2. The brief facts leading to the present appeal are as follows :-

2.1. The claimant – opponent Aniha Corporation is a proprietor firm managed through its proprietor Shri Chetankumar Ramanlal Shah. The Aniha Corporation is interested in the development of land and therefore, it entered into an agreement with the appellant Sardar Sarovar Narmada Nigam Limited ('SSNNL' hereinafter).

2.2. A tender was invited by SSNNL by issuing public advertisement in the newspaper for the lease of plot no.2 admeasuring 2064 sq.mtrs situated at Gandhinagar Airport Road on LHS downstream, Mouje Sughad of District Gandhinagar. A plot was to be developed for tourism purpose and the development was to take place as per the terms and conditions mentioned in the tender. The claimant – opponent being the successful bidder, the SSNNL agreed to entered into the lease agreement with it. The SSNNL agreed to lease out the plot no.2 to the opponent on payment of premium equivalent to the market value to develop the said property and on acceptance of the tender, a communication was sent in writing on 15.02.2007. A cheque of Rs.19,50,000/- was issued on 26.02.2007 and the additional security of six months' rent to the tune of Rs. 60,000/- had been also given.

2.3. A lease deed came to be executed after the parties entered into the understanding on 05.06.2007. The construction plan was prepared by the respondent and architecture design also was made. It was sent for the approval as per the terms and conditions of the agreement to the appellant on 11.10.2007.

2.4. It was averred by the opponent that the request was made to process the plan so that the project can be proceeded further. A communication was also sent to the Executive Engineer, Narmada Canal Section 4 to verify and approve the plans. It was sent to the Gandhinagar Urban Development Authority (GUDA) and Ahmedabad Urban Development Authority (AUDA). There was a request that after once it is sanctioned, the same is to be sent to the SSNNL. After about 10 months, a communication was received by the opponent that it cannot construct multi storied building and the plans were sent back to the opponent. It was insisted that the opponent was also get the plan sanctioned from the local development authority.

2.5. According to the opponent before 05.08.2008, on regular basis, the payment was made of the rent and frequent inquiries were made with the corporation with regard to the process whether was in the right direction. On 12.09.2008, it was communicated by the appellant to the opponent - claimant that it should start the development of subject plot and submit the schedule of development. It also was asked to get the sanction of the Urban Development Authority for the construction plan. It is all throughout alleged by the opponent - claimant that the appellant failed to fulfill the obligations of verifying and approving the construction plans and getting approval from the appropriate authorities since the subject land was owned by the appellant. The grievance on the part of the opponent - claimant is that it never supplied the information as requested for and therefore for want of necessary details and on the ground of zoning which had been asked for by the order, the matter got delayed.

2.6. On 15.12.2008, the opponent was informed that the Narmada Main Canal had a special structure and had a certificate in that regard. In wake of the background of AUDA regulations and restrictions, it was not possible to carry out the construction as per the plan. A communication was also received by the opponent to get the plan sanctioned with the local development authority and