Kuldip Chand Sood, J.—The question raised in this petition: "Whether a claimant decree holder is entitled to interest of 18% per annum under Section 31(7)(b) of the Arbitration and Conciliation Act, 1996 when the Arbitrator allowed interest at the rate of 12% per annum upto the date of award and kept silent so far interest from the date of award till the, date of payment is concerned?"

2. Facts, necessary, may be noticed.

3. An award was made in favour of the petitioner-Decree Holder by e Arbitrator (Superintending Engineer, Arbitration, HP, PWD, Solan) in case No. SE-ARB-244/96 on 26th October, 1999 in the following terms: "AWARD IN FAVOUR OF PLAINTIFF-M/S. KATARIA BUILDERS, 224 SAINGARH PATHANKOT (PUNJAB)-CLAIMANT. Sr. No. Particulars of Claim Amount Demanded Amount Awarded Remarks 1 2 3 4 5 CLAIMS 1. Due to prolongation contract. Rs. 8,84,000/- Rs. 56,375/- 2. On account of Final bill. Rs, 1,42,222/- Rs. 1,06,885/- 3. On account of items not paid. Rs. 80,000/-(Modified to Rs. 54,731/-) NIL 4. Works executed beyond deviation limit. Rs. 1,50,000/- Rs. 80,279/- 5. Reimbursement of material. Rs. 59,800/- NIL 6. Items executed not paid. Rs. 1,5,000/- Rs. 17,799/- 7. Refund of security. Rs. 46,820/- Rs. 46,820/- 8. 10-C Claim. Rs. 70,000/- Beyond jurisdiction of Arbitrator. 9.& 10. Interest. @ 18% per annum @ 12% per annum simple interest on Rs. 3,08,158/- for Eight years till date of award 11. Arbitration cost. Rs. 10,000/- NIL Total :— Rs. 3,03,158/- + interest as awarded against claim Nos. 9 & 10. AWARD IN FAVOUR OF RESPONDENT-EXECUTIVE ENGINEER, NURPUR DIVISION, HP, PWD, NURPUR Sr. No. Description or Counter-claim Amount Demanded Amount Awarded Remarks 1 2 3 4 5 Counter-Claims.

1. On account of Final bill. Rs. 87,900/- NIL

2. Cost of Arbitration. Rs. 2,500/- NIL Total: NIL

4. The petitioner-decree holder claims interest on the amount of award at the rate of 18% per annum from the date of the award till the payment of the award amount in terms of Section 31(7)(b) of the Arbitration and Conciliation Act, 1996 (Act for short). The respondent-State resist the claim of the petitioner for this interest on the grounds that Arbitrator has allowed interest at the rate of 12% per annum and therfore, the decree holder is not entitled to future interest at a rate exceeding 12% per annum.

5. Sub-section (7) of Section 31 of the Act provides for the interest on the payment of arbitral award for the payment of money. Sub-section (7) of Section 31 is reproduced for convenience: “31(7)(a) Unless otherwise agreed by the parties, where and in so far as an arbitral award is for the payment of money, the arbitral tribunal may include in the sum for which the award is made interest, at such rate as it deems reasonable, on the whole or any part of the money, for the whole or any part of the period between the date on which the cause of action arose and the date on which the award is made. (b) A sum directed to be paid by an arbitral award shall, unless the award otherwise directs, carry interest at the rate of eighteen per centum per annum from the date of the award to the date of payment/ (Emphasis given)

6. A perusal of sub-section (7) shows that an arbitral award, if it is for the payment of money may carry interest as such rate as is deemed reasonable by the Arbitrtor on the whole or any part of the money, for the whole or any part of the period between the date on which the cause of action arose and the date on which the award is made.

7. Clause (b) of sub-section (7) of Section 31 provides for the future interest i.e. interest from the date of the award till the payment of the amount of award. This clause stipulates that in addition to the sum payable under the award, which indeed include the interest under clause (a) of sub-section (7) of Section 31, the decree holder shall also be entitled to an interest at the rate of 18% per annum from the date of the award to the date of the payment unless the award otherwise directs.