UNION OF INDIA Vs. MANRAJ ENTERPRISES

JUDGEMENT

(1.) Feeling aggrieved and dissatisfied with the impugned judgment and order dated 12.04.2021 passed by the High Court of Delhi in FAO(OS) No.52/2018, whereby the Division Bench of the High Court has dismissed the said appeal of the appellant and has confirmed the order passed by the learned Single Judge upholding the award of interest by the sole arbitrator, the Union of India has preferred the present appeal.

(2.) That a contract was entered into between the appellant and the respondent with regard to three work contracts. A dispute arose between the parties and both the parties went into arbitration for the resolution of the dispute. The learned sole arbitrator vide award dated 17.01.2011 awarded an amount of Rs.78,81,553.08. The learned arbitrator also awarded pendente lite and future interest at the rate of 12% and 18% respectively on the entire awarded amount except for the earnest money deposit and security deposit.

(3.) Shri K.M. Nataraj, learned Additional Solicitor General appearing on behalf of the appellant - Union of India has vehemently submitted that as agreed between the parties and as per clause 16(2) of the General Conditions of Contract (for short, 'GCC ') governing the contract between the parties, there was a bar against payment of interest. It is submitted that as agreed between the parties and as per clause 16(2), no interest shall be payable upon the earnest money or the security deposit or the amounts payable to the contractor under the contract.