Delhi Development Authority vs Pandit Munshi Ram Associates (Pvt.) Ltd and Another

Mukul Mudgal, J.

1 This appeal challenges the order dated 10.2.2006 passed by the learned Single Judge making the award a rule of the court after partially modifying the same. Learned Counsel for the appellant has vehemently submitted that quite apart from the errors of the learned Single Judge in affirming the award, the substantial objection of the appellant is to the grant of interest at 9% granted by the learned Single Judge and which does not accord with Indian Interest Act. This Court has been consistently following the practice in view of the prevalent reduced rates of interest and has been therefore awarding interest at the rate of 9% per annum in terms of judgments of Supreme Court in Rajendra Construction Company Vs. Maharashtra Housing and Area Development Authority and Others, , McDermott International Inc. Vs. Burn Standard Co. Ltd. and Others, , Rajasthan State Road Transport Corpn. Vs. Indag Rubber Ltd., & Krishna Bhagya Jala Nigam Ltd. Vs. G. Harischandra Reddy and Another, . The learned Single Judge has granted interest at 9% and, therefore, we do not feel any necessity to interfere with regard to the rate of interest.

The learned Counsel for the appellant has submitted that interest upon interest has been granted. Paras 19 and 20 of the judgment of the learned Single Judge which reads as follows:

Other objection is to the award of interest and it is submitted that awarding of interest @ 18% per annum is quite excessive. In view of judgment of the Supreme Court in the case of State of Rajasthan and Another Vs. Nav Bharat Construction Co., and having regard to the prevailing interest rates, award of interest @ 18% per annum appears to be excessive. Learned Counsel for the contractor conceded that the interest may be reasonable reduced. I am, therefore, of the opinion that the pendent lite interest which is granted @ 18% per annum with effect from 3rd January 1992 till the date of award as well as future interest from the date of award till the date of decree should be paid @ 9% per annum. The award is modified to this extent. Decree in terms of the award. Other objections are dismissed.

CS(OS) No. 1780A/97

The award as modified is made rule of the Court. Learned Counsel for the claimant further agreed that in case payment is made within 60 days, no future interest from the date of decree would be claimed. It is ordered accordingly. However, in case payment is not made within 60 days, the decree holder shall be entitled to future interest as well @ 9% per annum from the date of decree till the next date of payment. Decree be drawn accordingly.

Perusal of the above judgment clearly shows that interest upon interest has not been granted. This plea has not been raised in the grounds of appeal, but, nevertheless in the interest of justice, we have examined the above plea and found it to be bereft of merit.

The findings of the learned Single Judge are entirely factual while affirming the award of the arbitrator. We see no reason to differ from the factual finding arrived at by the arbitrator and affirmation of the award by the learned Single Judge. Accordingly, there is no merit in the appeal since , as already stated, the interest has been awarded at 9% per annum which is just fair and reasonable. The appeal is dismissed. There is no order as to costs.