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2021 (11) TMI 728 - SUPREME COURTValidity of award of interest by the sole arbitrator - earnest money and security deposits or not - in view of the specific clause 16(2) of the GCC, whether the contractor is entitled to any interest pendente lite on the amounts payable to the contractor other than upon the earnest money or the security deposit? HELD THAT:- An identical question came up for consideration before this Court in the recent decision of this Court in the case of GARG BUILDERS VERSUS BHARAT HEAVY ELECTRICALS LIMITED [2021 (10) TMI 250 - SUPREME COURT] where it was held that the High Court was justified in rejecting the claim of the appellant seeking pendente lite interest on the award amount. Merely because the appellant has claimed interest, does not imply that the contractor shall be entitled to interest pendente lite. Even if the appellant would have been awarded interest, the same also was not permissible and could have been a subject matter of challenge. In short, there cannot be an estoppel against law. The learned Arbitrator in the instant case has erred in awarding pendente lite and future interest on the amount due and payable to the contractor under the contract in question and the same has been erroneously confirmed by the High Court - the impugned judgment and order passed by the Division Bench of the High Court in an appeal under Section 37 of the 1996 Act and the order passed by the learned Single Judge in an application under Section 34 of the 1996 Act and the award passed by the learned Arbitral Tribunal awarding pendente lite and future interest on the amounts held to be due and payable to the contractor under the contract are hereby quashed and set aside. Appeal allowed.
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