Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Arbitration and Conciliation Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Act(s) Referred | Arbitration and Conciliation Act, 1996 (26 of 1996) |
Case(s) Referred | Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Arbitration and Conciliation Act, 1996: s.31(7)(a) – Pendente lite interest on the award amount – Interest barring clause in the contract – Claim for pre-reference pendente lite and future interest – Held: It is clear from s.31(7)(a) that if the contract prohibits pre- reference and pendente lite interest, the arbitrator cannot award interest for the said period – In the instant case, clause barring interest is very clear and categorical – It uses the expression “any moneys due to the contractor” by the employer – Therefore, it is not open for the arbitrator to grant pendente lite interest – Interest – Contract Act, 1872 – s.28. Contract Act, 1872: s.28 – Interest barring clause – Whether contract barring payment of interest extinguish the rights of the parties and, therefore, ultravires in terms of s.28 of the Contract Act, 1872 – Held: The provisions of s.3(3) of the Interest Act, 1978 explicitly allows the parties to waive their claim to interest by virtue of an agreement – s.3(3)(a)(ii) states that the Interest Act will not apply to situations where the payment of interest is “barred by virtue of an express agreement” – Thus, when there is an express statutory permission for the parties to contract out of receiving interest and they have done so without any vitiation of free consent, it is not open for the arbitrator to grant pendente lite interest – Thus, interest barring clause of the contract is not ultra vires in terms of s.28 of the Contract Act, 1872 – Interest Act, 1978. |
Judge | Hon'ble Mr. Justice S. Abdul Nazeer |
Neutral Citation | 2021 INSC 606 |
Petitioner | Garg Builders |
Respondent | Bharat Heavy Electricals Limited |
SCR | [2021] 10 S.C.R. 82 |
Judgement Date | 2021-10-04 |
Case Number | 6216 |
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