TMI Blog2022 (5) TMI 977X X X X Extracts X X X X X X X X Extracts X X X X ..... te 30 days after the demand of Termination payment by DAMEPL on 8th July, 2013). It is pertinent to note that though the Arbitral Tribunal has found that the rates of interest on loans taken by the Appellant-DAMEPL are lower than SBI PLR + 2%, it has observed that it was beyond the competence of the Arbitral Tribunal to change or alter or modify the provisions of the Concession Agreement. The Arbitral Tribunal, therefore, has granted interest at an annualized rate of SBI PLR + 2%, though it had found that the rate of interest on which the loan was taken by the Appellant-DAMEPL was on the lower side. The Arbitral Tribunal, therefore, has rightly given effect to the specific agreement between the parties with regard to the rate of interest. We find that the arbitral award has been passed in consonance with the provisions as contained in Clause (a) of Sub-section (7) of Section 31 of the 1996 Act and specifically, in consonance with the phrase unless otherwise agreed by the parties . In view of the specific agreement between the parties, the interest prior to the date of award so also after the date of award will be governed by Article 29.8 of the Concession Agreement, as has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Under Section 34 of the 1996 Act. The said judgment and order dated 6th March, 2018 came to be challenged by the Respondent-DMRC before the Division Bench of the Delhi High Court by way of appeal being FAO(OS)(COMM.) No. 58 of 2018. The said appeal was partly allowed by the Division Bench of the Delhi High Court vide the judgment and order dated 15th January, 2019. Being aggrieved thereby, the Appellant-DAMEPL preferred Civil Appeal No. 5627 of 2021 [arising out of Special Leave Petition (Civil) No. 4115 of 2019] before this Court. The said appeal came to be allowed by this Court by judgment and order dated 9th September, 2021, vide which the judgment and order dated 15th January, 2019, passed by the Division Bench of the Delhi High Court was set aside. 6. The Appellant-DAMEPL thereafter immediately filed an Execution Petition being OMP (ENF.) (COMM.) No. 145 of 2021 on 12th September, 2021, before the Delhi High Court for enforcement of the Arbitral Award dated 11th May, 2017 passed by the Arbitral Tribunal. Various orders came to be passed by the learned Single Judge of the Delhi High Court in the said proceedings from time to time. Vide the impugned judgment and order da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date of the award till the date of payment. The learned Senior Counsel would submit that the aforesaid interpretation is the only logical interpretation. He submits that the High Court has, therefore, erred in rejecting the claim of the Appellant-DAMEPL with regard to addition of the interest pendente lite in the sum to be arrived at under Clause (a) of Sub-section (7) of Section 31 of the 1996 Act. 9. Shri Parag P. Tripathi, learned Senior Counsel, on the contrary, would submit that the High Court has correctly rejected the claim of the Appellant-DAMEPL. He submits that Clause (a) of Sub-section (7) of Section 31 of the 1996 Act itself begins with the phrase unless otherwise agreed by the parties . He submits that there is a specific agreement between the parties Under Article 29.8 of the Concession Agreement, with regard to payment of interest. Learned Senior Counsel submits that since there is an agreement between the parties as to how the interest would be awarded and that since the same has been awarded by the Arbitral Tribunal in accordance with the agreement, the majority judgment of this Court in the case of Hyder Consulting (UK) Limited (supra) would not be of any assi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that an award, inclusive of interest for the pre-award period on the entire amount directed to be paid or part thereof, may be passed. The sum awarded may be the principal amount and such interest as the Arbitral Tribunal deems fit. If no interest is awarded, the sum comprises only the principal. The significant words occurring in Clause (a) of Sub-section (7) of Section 31 of the Act are the sum for which the award is made . On a plain reading, this expression refers to the total amount or sum for the payment for which the award is made. Parliament has not added a qualification like principal to the word sum , and therefore, the word sum here simply means a particular amount of money . In Section 31(7), this particular amount of money may include interest from the date of cause of action to the date of the award. 5 . The Oxford Dictionary gives the following meaning to the word sum : Sum, 'if noun'.--A particular amount of money. Sum, 'if verb'.--The total amount resulting from the addition of two or more numbers, amounts, or items. 6 . In Black's Law Dictionary, the word sum is given the following meaning: Sum.--In English law-- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 34 Code of Civil Procedure Parliament conferred power on a court to order interest on the principal sum adjudged and not on merely the sum as provided in the Arbitration Act. The departure from the language of Section 34 Code of Civil Procedure in Section 31(7) of the 1996 Act is significant and shows the intention of Parliament. 12 . It is settled law that where different language is used by Parliament, it is intended to have a different effect. In the Arbitration Act, the word sum has deliberately not been qualified by using the word principal before it. If it had been so used, there would have been no scope for the contention that the word sum may include interest. In Section 31(7) of the Act, Parliament has deliberately used the word sum to refer to the aggregate of the amounts that may be directed to be paid by the Arbitral Tribunal and not merely the principal sum without interest. 13 . Thus, it is apparent that vide Clause (a) of Sub-section (7) of Section 31 of the Act, Parliament intended that an award for payment of money may be inclusive of interest, and the sum of the principal amount plus interest may be directed to be paid by the Arbitral Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J. in the case of Hyder Consulting (UK) Limited (supra). Applying the principle of plain interpretation of the language employed by the legislature, the position that would emerge, on an analysis of Clause (a) of Sub-section (7) of Section 31 of the 1996 Act, is as under: (i) It begins with the words Unless otherwise agreed by the parties ; (ii) where and insofar as an arbitral award is for the payment of money, the Arbitral Tribunal may include interest component in the sum for which the award is made; (iii) the interest may be at such rate as the Arbitral Tribunal deems reasonable; (iv) the interest may be on the whole or any part of the money; (v) the interest may be for the whole or any part of the period between the date on which the cause of action arose and the date on which the award is made. 15. It could thus be seen that the part which deals with the power of the Arbitral Tribunal to award interest, would operate if it is not otherwise agreed by the parties. If there is an agreement between the parties to the contrary, the Arbitral Tribunal would lose its discretion to award interest and will have to be guided by the agreement between the parties. The p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat no interest shall be payable, the Arbitral Tribunal cannot award interest between the date when the cause of action arose to the date of award. 18. If Clause (a) of Sub-section (7) of Section 31 of the 1996 Act is given a plain and literal meaning, the legislative intent would be clear that the discretion with regard to grant of interest would be available to the Arbitral Tribunal only when there is no agreement to the contrary between the parties. The phrase unless otherwise agreed by the parties clearly emphasizes that when the parties have agreed with regard to any of the aspects covered under Clause (a) of Sub-section (7) of Section 31 of the 1996 Act, the Arbitral Tribunal would cease to have any discretion with regard to the aspects mentioned in the said provision. Only in the absence of such an agreement, the Arbitral Tribunal would have a discretion to exercise its powers under Clause (a) of Sub-section (7) of Section 31 of the 1996 Act. The discretion is wide enough. It may grant or may not grant interest. It may grant interest for the entire period or any part thereof. It may also grant interest on the whole or any part of the money. 19. If the contention as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (7) of Section 31 of the 1996 Act, the Arbitral Tribunal will cease to have any discretion and would be bound by an agreement between the parties. 23. As already discussed hereinabove, any interpretation which would render the phrase unless otherwise agreed by the parties otiose or redundant will have to be avoided. It will be apposite to refer to the following observations of the Constitution Bench of this Court in the case of Hardeep Singh v. State of Punjab and Ors. - (2014) 3 SCC 92: 44 . No word in a statute has to be construed as surplusage. No word can be rendered ineffective or purposeless. Courts are required to carry out the legislative intent fully and completely. While construing a provision, full effect is to be given to the language used therein, giving reference to the context and other provisions of the statute. By construction, a provision should not be reduced to a dead letter or useless lumber . An interpretation which renders a provision otiose should be avoided otherwise it would mean that in enacting such a provision, the legislature was involved in an exercise in futility and the product came as a purposeless piece of legislation and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Article 29.8 of the Concession Agreement deals with payment of interest on Termination Payment amount. 27. The Arbitral Tribunal rightly construing the Concession Agreement has directed thus: 129 . Therefore, the Termination Payment to DAMEPL works out to Rs. 983.02 +Rs. 1260.73 +Rs. 538.58 crores =Rs. 2782.33 crores . As regards rate of interest on the Termination payment, the stipulation of Article 29.8 of CA is at an annualized rate of SBI PLR +2%. We have noted from the financial documents of DAMEPL (Pg 299 of CD11-Supplementary reply of DMRC dated 22.2.2014 to the Counter Claim of the Respondent) that the secured loan taken by DAMEPL carries the rate of interest of 12.75% on Rupee Term Loan and is in the range of 4.83% to 5.6% for Foreign Currency Loan. Although the rates of interest on loans taken by DAMEPL are lower than SBI PLR +2%, we are of the opinion that it is beyond the competence of the Tribunal to change or alter or modify the provisions of CA. As such, we decide that the Termination payment will be as per the provisions of Article 29.8 of CA and the interest on the Termination payment will accrue from 7.8.2013 (i.e. the date 30 days after the demand of Term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very judgment must be read as applicable to the particular facts proved, or assumed to be proved. The generality of the expressions which are found in a judgment cannot be considered to be intended to be exposition of the whole law. They will have to be governed and qualified by the particular facts of the case in which such expressions are to be found. 32. It will also be apposite to refer to the following observation of another three-Judge Bench of this Court in the case of The Regional Manager and Anr. v. Pawan Kumar Dubey - (1976) 3 SCC 334: 7 . ......Even where there appears to be some conflict, it would, we think, vanish when the ratio decidendi of each case is correctly understood. It is the Rule deducible from the application of law to the facts and circumstances of a case which constitutes its ratio decidendi and not some conclusion based upon facts which may appear to be similar. One additional or different fact can make a world of difference between conclusions in two cases even when the same principles are applied in each case to similar facts. 33. This Court has held that the ratio decidendi is the Rule deducible from the application of law to the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
