SURI CONSTRUCTIONS Vs. DELHI DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) BY this order, I am disposing of the objections of the plaintiff as well as the defendant to the award dated 17.6.1988 and supplementary award dated 22.7.1988 made and published by Mr.M.C. Bahl, sole Arbitrator, being 1.As. No. 3665/89 and 3666/89 respectively in respect of the work of construction of 152 Three-bed, 76-Two bed, 64 Servant Quarters and 32 garages at Siddhartha Enclave (Sunlight Colony), near Asharm (SFS) Building work including general watersuppiy, sanitary mstallation and external development.

(2.) THE defendant has raised objection only to claim No.21) relating to the award of pendente lile interesl @12% p.d. THE defendant has relied upon the cases of Food Corporation of India Vs. M/s Surendra, Devendra and Mohendra Transport Co., reporled as AIR 1988 SC 734, Executive Engineer, Irrigation, Galimata and others Vs. Abnadula lena, reporled as AIR 1988 SC 1520 and State of Orissa and others vs. Construction India, reported as AIR 1988 SC 1530. I am not in agreement with the counsel for the defendani in as much as the law on the authority of the Arbitrator to award pendente lite inlerest has been reslated by the Hon'ble Supreme Court and has since undertone a sea change. A reference in this connection may be made to the case of Secretary, lrrigation Department, Government of Orissa and others Vs. G.C. Roy reported as JT (1991) 6 SC 349 wherein the Hon'ble Supreme Court after an elaborate discussion was pleased to lay down that absence of reason for awarding interest will not render an award liable to set aside. It was laid down following the decision in the case of Raipur Development Aulhority Vs. Chokhamal Contractor, reported as JT (1989) 2 SC 285 and furthermore, the Court held as follows : "On a conspectus of aforementioned decisions, the following principles emerge : (i) A person deprived of the use of money to which he is legitimately entitled has a right to be compensated for the deprivation, call it by any name. It may becalled interest, compensation or damages. I his basic consideration is as valid for the period the dispule is pending before the arbilrator as it is for the period prior to the arbitrator entering upon the reference. This is the principle of s.34, Civil Procedure Code ., and there is no reason or principle to hold otherwise in the case ot arbitrator. (ii) an arbitrator is an altvmativc forum for resolution of disputes arising between the parties. If so, he must have the power to decide all the disputes or differences arising between the parties. If the arbitrator has no power to award interest pendente lite, the party daiming it would have to approach the Court for that purpose, even though he may have obtained satisfaction in respect of other claims from the arbitrator. This would lead to multiplicity of proceedings..... (v) Interest pendente lite is not a matter of substantive law, like interest for the period anterior to reference (pre-reference period). For doing complete justice between the parties, such power has always been inferred." THE question regarding grant of interesi and powers of the Arbitrator to do so again came up for consideration by the Hon'ble Supreme Court in the case of Hindustan Construction Company Limited Vs. Stale of Jammu and Kashmir, reported as AIR 1992 SC 2192 in which the Hon'ble Supreme Court, while referring to the case of G.C. Roy held as follows :- "THE principle of the decision makes it clear that the arbitrator is competent to award interest for the period commencing with the date of award to the date of decree or date of realisation, whichever is earlier. This is also quite logical for, while award of interest for the period prior to an arbitrator entering upon the refercnce is a matter of substantive law, the grant of interest for the post-award period is a matter of procedure. Section 34 of Code of Civil Procedure provides both for awarding of interest pendente lite as well as for the post-decree period and the principle of S.34 has been held applicable to proceedings before the arbitrator, though the section as such may not apply." Again in another decision in the case of Jugal Kishore Vs. Vijender Prabhati Lal, reported as JT 1992 (Supplement) SC 112, the Court after considering all the decisions on the point held that the Arbitrator was within his rights to grant interest pendente lite, i.e., from the date of 'reference till the date of decree in terms of the awared and as such, grant of interest was upheld by the Court. THE Court further observed that the Arbitrator has all the powers of the Court in the matter of awarding interest. In the light of this psition, which has come to exist, I find no merit in the objections of the defendant. THE same are rejected with the consequence thal 1.A .No. 3666 is dismissed.