Case Note & Summary
The dispute arose between the parties regarding the interpretation of the 'sum' awarded under the Arbitration and Conciliation Act, 1996. The appellant, Delhi Airport Metro Express Private Limited (DAMEPL), and the respondent, Delhi Metro Rail Corporation (DMRC), entered into a Concession Agreement on 25th August 2008, which included provisions for termination payments. Following a dispute, DAMEPL terminated the agreement on 8th October 2012, leading to arbitration and an Arbitral Award on 11th May 2017. DMRC challenged the award in the Delhi High Court, which upheld it. DAMEPL subsequently filed an Execution Petition, seeking to include interest in the sum awarded. The High Court rejected this claim, prompting DAMEPL to appeal to the Supreme Court. The Supreme Court examined the interpretation of Section 31(7) of the Arbitration Act, particularly the inclusion of interest in the awarded sum. The court referenced the majority judgment in Hyder Consulting (UK) Limited v. Governor, State of Orissa, which clarified that the 'sum' could include interest unless otherwise agreed by the parties. The court found that the specific agreement in the Concession Agreement regarding interest payments limited the Arbitral Tribunal's discretion. Ultimately, the Supreme Court dismissed the appeal, affirming the High Court's decision and emphasizing the importance of party autonomy in arbitration agreements.
Headnote
A) Arbitration Law - Interpretation of 'sum' in Arbitral Awards - Inclusion of interest - Arbitration and Conciliation Act, 1996, Section 31(7) - The court held that the 'sum' awarded may include interest for the pre-award period and that post-award interest is to be calculated on the total sum, including any pre-award interest, unless otherwise agreed by the parties. The court emphasized the importance of the phrase 'unless otherwise agreed by the parties' in determining the applicability of interest (Paras 2, 10, 35).
Issue of Consideration
Whether the 'sum' awarded under clause (a) of subsection (7) of Section 31 of the Arbitration and Conciliation Act, 1996 includes interest pendente lite.
Final Decision
The Supreme Court dismissed the appeal, affirming the High Court's decision that the sum awarded did not include interest pendente lite due to the specific agreement between the parties regarding interest payments.
Law Points
- Interpretation of statutes
- Arbitration and Conciliation Act
- 1996
- Interest pendente lite
- Arbitral Tribunal powers
- Party autonomy
