UNION OF INDIA Vs. S B PATIL

JUDGEMENT

(1.) The only question which arises in this Civil Revision Petition relates to the power of Arbitrator to grant interest on the amounts found to be due to the contractor.

(2.) It is the contention of the learned Counsel appearing for the petitioner/ Railway that the Clause 16(2) of the Standard General Conditions of contract prohibits the grant of interest upon the earnest money or the security deposit and the amounts payable to the contractor under the contract and as such, the Arbitrator acted illegally and without jurisdiction in awarding the interest at 18% per annum from the date of Award till the award is made Rule of the Court on the various amounts found due and payable to the contractor. In support of his contention the learned Counsel for the petitioners, sought to place reliance on the judgment of the Supreme Court in Grid Corporation of Orissa Limited and another vs. Balasore Technical School. In the said judgment it has been held that;

(3.) The learned Counsel for the petitioners has further contended that in any case the grant of interest at the rate of 18 per cent per annum by the Arbitrator from the date of award till the date of making the award Rule of the Court, is illegal. It is also contended that the grant of interest on the amounts due amounts to granting damages on damages and it is not permissible in law. I do not, however, find any merit in these submissions also, since the Arbitrator has granted interest only from the date of award, but, not earlier and the lower Court while making the award Rule of the Court, granted future interest from the date of decree till realisation at 6 per cent per annum only. I do not, therefore, find any merit in the Civil Revision Petition and accordingly it is dismissed, but without costs.