Summary
In execution of the Delhi Airport Metro arbitral award, the concessionaire sought post-award interest on termination payment plus pre-award interest, relying on Hyder Consulting. The Court rejected that computation because the parties’ specific interest agreement governed the award. It upheld the executing court’s rejection of the claim and distinguished Hyder Consulting, where no contrary interest agreement had been considered.
Issues
- Whether pre-award interest could be added to the termination-payment base for calculating post-award interest despite the parties’ specific agreement.
Provisions considered
- Section 31(7)(a) and (b), Arbitration and Conciliation Act, 1996Gave effect to the parties’ agreed interest terms and the award rather than automatically applying the aggregate-sum approach invoked from Hyder Consulting. (¶¶ 10-19, 22-29, 34-36)
Held
- Section 31(7)(a) gives the tribunal discretion over the grant, rate, period and base of pre-award interest only to the extent the parties have not otherwise agreed. An agreement governing an aspect of interest binds the tribunal on that aspect; construing the provision otherwise would deprive its opening qualification of effect. (¶¶ 14-19, 22-24)
- Article 29.8 required unpaid termination payment to carry interest at an annualized SBI PLR plus 2% after the stipulated thirty-day period. The tribunal applied that agreement, directing interest from 7 August 2013 and payment to the escrow account. Its refusal to substitute lower financing rates respected the contractual terms. (¶ 25-28)
- Hyder Consulting recognised that an awarded sum may include pre-award interest, but did not address a specific agreement governing interest. Its aggregate-sum reasoning did not override the agreement in this case. The Court held that both pre-award and post-award interest were governed by Article 29.8 as directed in the award, whose findings had attained finality in the earlier proceedings. (¶¶ 11-13, 25, 29-35)
Result
Appeal dismissed, sustaining the executing court’s rejection of the concessionaire’s proposed interest computation. Pending applications disposed of; no order as to costs.