CR No.1522 of 2010 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CR No.1522 of 2010 Date of decision: 26.8.2010 M/s Shastri Construction Co. ......Petitioner(s) Versus Union of India and others ......Respondent(s) CORAM:- HON'BLE MR.JUSTICE RAKESH KUMAR GARG * * * Present: Mr. Raman Mahajan, Advocate for the petitioner. Mrs. K.K. Kahlon, Advocate for the respondents. Rakesh Kumar Garg, J. By way of this revision petition, the petitioner-Company has challenged the order dated 23.11.2009 passed by the Civil Judge (Jr.Division), Chandigarh whereby execution petition field by the petitioner has been dismissed erroneously while accepting the objections filed by the respondents. As per the averments, the dispute between the parties was referred to the Arbitrator for adjudication. An award dated 29.6.1987 was passed by the Arbitrator and the respondent was directed to pay the awarded amount within a period of 60 days from the date of publication of award and in case of default to make payment within 60 days, simple interest on the awarded amount at the rate of 12% per annum was to be paid to the petitioner upto the date of payment or decree of the Court, whichever was earlier. The respondent-Union of India failed to make the payment of the awarded amount within 60 days as stipulated aforesaid. Since no CR No.1522 of 2010 2 payment was made, the petitioner approached the Court for making award as a rule of the Court. The respondent preferred objections for setting aside the award. Vide order dated 2.12.1988 the award was made rule of the Court except pendente lite interest. The operative part of the award reads as under:- “It is ordered that in view of the my findings or the above stated issues, I do not find any reason to interfere in the award given by Arbitrator Sh. A.K. Mullick except to set aside the award allowing pendente lite interest. The petitioner will be liable to pay the interest @ 12% per annum in case the objector-petitioner failed to make the payment of the awarded amount within a period of one month.” The appeals filed by both the parties against the aforesaid order and decree of the Court were dismissed by one common judgment dated 2.4.1990 passed by the Additional District Judge, Chandigarh. Civil Revision No.2112 of 1990 filed by the petitioner against the aforesaid judgment/order dated 2.4.1990 of the Additional District Judge, Chandigarh was dismissed by this Court on 23.8.1990. Civil Revision No. 2394 of 1990 filed by the respondent was also dismissed by this Court vide order dated 13.3.1992. In pursuance of the warrants of attachment issued by the Executing Court for a sum of Rs.16,46,381.52, the respondent made payment to the tune of Rs.11,19,693/- on 28.4.1992 giving the details of the aforesaid amount as worked out by the respondent-Union of India which reads as follows: “i) Awarded amount Rs.7,95,051-00 ii) Amount of simple interest @12 p.a. w.e.f.02-12-88 i.e CR No.1522 of 2010 3 date of decree, upto 27th April, 92 Rs.3,24,642-00 -------------------------- Total Rs.11,19,693-00 -------------------------- Before the Executing Court, the petitioner argued that the date of award was 29.6.1987 and date of the Court decree was 2.12.1988. As per the award from the time of publication i.e. 29.6.1987, to the date of Court decree i.e. for the period for one year and 157 days, no amount of interest, which was otherwise payable as per the award, was calculated. Since the payment was made on 27.4.1992 i.e. after 3 years and 147 days, the interest on Rs.9,31,494.82 comes to Rs.3,80,356.12 P total amount of Rs.13,11,850.94P. Since the payment of only a sum of Rs.11,19,693/- was made, according to the petitioner, payment of Rs.1,92,157.94 P was still outstanding and therefore, till date, the interest on the amount of oustanding amount comes to Rs.4,02,299.76P i.e. Rs.5,94,457.70P. Thus, it was aruged that the amount of Rs.5,42,840.58 P along with interest was payable. On the other hand, it was argued on behalf of the respondent that the calculations and arguments put forwarded by the counsel for the decree-holders were incorrect. It was stated that the amount including pendente lite interest was already paid to the decree- holder on 28.4.1992 in full satisfaction of the decree. It was stated that no interest was payable for the period between 29.6.1987 to 2.12.1988 as no interest for this period was awarded by the Court. It was argued that the difference in payment shown by the decree-holder pertains to this period for which interest was never awarded either by the Arbitrator or by the Court. The Civil Judge (Jr. Division), Chandigarh vide impugned order allowed the objections filed by the judgment-debtor and execution petition was filed on behalf of the decree-holder was dismissed having become CR No.1522 of 2010 4 infructuous. Before this Court, the only contention raised by the learned counsel for the petitioner was that as per award of the Arbitrator dated 29.6.1987, the petitioner was entitled to interest at the rate of 12@ per annum upto the date of payment or Court's decree, if the awarded amount was not paid within 60 days from the date of pronouncement/publication of the award. Learned counsel appearing on behalf of the respondent very fairly could not dispute the fact that vide award dated 29.6.1987, the payment of net amount of award was to be made within 60 days from the date of publication of the award and in case of default, simple interest on the net awarded amount at the rate of 12% per annum was to be paid by the respondent to the claimants upto the date of payment or the Court's decree whichever was earlier. Thus, there is no dispute that the Arbitrator awarded the interest at the rate of 12% per annum on the awarded amount to the petitioner-Company in case the awarded amount was not paid within the stipulated period of 60 days. Admittedly, the net awarded amount was not paid within 60 days as stipulated aforesaid. It may be relevant to mention at this stage that the Hon'ble Supreme Court of India in the case of Secretary to Government of Orissa & others v. Rathunath Mahapatra, JT 1991 (6) SC 349 has held that in every case where the arbitration agreement does not exclude the jurisdiction of the Arbitrator to award interest pendente lite, such powers must be inferred and the award as such is to be maintained. It is not the case of the parties that in this case, the arbitration agreement has excluded the jurisdiction of the Arbitrator to award interest pendente lite. In this view of the matter, no fault can be found with the interest awarded by the Arbitrator as stipulated vide award dated CR No.1522 of 2010 5 29.6.1987. Moreover, while making the award as the rule of the Court, the Civil Court has not excluded the aforesaid period w.e.f. 29.6.1987 upto 2.12.1988 and what has been set aside is the part of the award of the Arbitrator allowing pendente lite interest for the period it remained pending before the Arbitrator on the claims made under item No.39 under the head “pendente lite interest”. Learned counsel for the respondent was unable to point out any other interpretation of decree dated 2.12.1988 before this Court. In view of the aforesaid, this revision petition is accepted. The impugned order is set aside and matter is remitted back and the Executing Court is directed to determine the balance amount payable to the petitioner as per the decree dated 2.12.1988. Let the parties through their counsel be present before the Executing Court on 15.9.2010. August 26, 2010 (RAKESH KUMAR GARG) ps JUDGE `