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NON-REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.8077-8079 OF 2015 [@ SPECIAL LEAVE PETITION (C) NO. 36013-36015 OF 2013]

U.O.I & ANR                                 Appellant(s)                                 VERSUS

M.P TRADING & INVESTMENT RAC. CORP.  LTD            Respondent(s)

J U D G M E N T

Leave granted.   The sole dispute in these cases is with regard to

the payment of interest when the proceedings under Section 34 of the Arbitration and Conciliation Act, 1956 were pending before the High Court.  In the case before  us,  we  find  that  the  award  was  passed  on 02.03.2001.  When the matters were pending before the High Court, there was a direction vide order dated 04.02.2003 to deposit the Principal amount before the High Court.  The amount was deposited on 03.03.2003. Subsequently,  by  order  dated  22.05.2003,  the  High Court,  on  the  request  made  by  the  respondent, directed  the  Court  deposit  to  be  made  as  a  Fixed Deposit  in  a  nationalist  bank.   Ultimately,  the objections were rejected on 02.06.2006 and the appeal thereon was also dismissed on 27.09.2006.  Placing reliance on the decision of Himachal Pradesh Housing and Urban Development Authority and Anr. Vs. Ranjit

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Singh  Rana reported  in  (2012)  4  SCC  505,  it  is contended by the learned counsel appearing for the appellants  that  once  the  amount  is  deposited  in Court, there is no liberty to pay interest in terms of the award.   

Paragraph 15 of the Judgment reads as under :- “The word 'payment' may have different

meaning in different context   but   in

the  context  of  Section  37(1)(b);  it

means  extinguishment  of  liability

arising under the award. It   signifies

satisfaction of the award.  The deposit

of the award amount into the Court is

nothing but a payment to the credit of

the decree-holder.  In this view, once

the award amount was deposited by the

appellants  before  the  High  Court  on

May  24,  2001,  the  liability  of

post-award interest from May 24, 2001

ceased. The High Court, thus, was not

right  in  directing  the  appellants  to

pay the interest @18% p.a. beyond May

24, 2001.”

In the present case, we find that the amount was to be deposited in a Fixed Deposit at the request made by the respondent and it is not seen that the respondent has made any request before the High Court

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for  withdrawal of  the amount  deposited as  per the directions  by  the  High  Court.   However,  it  is submitted that the appellants have not deposited the full amount in terms of the award.     

In the above facts and circumstances of the case, we  are  of  the  view  that  the  appellants  shall  be entitled to interest as per award from the date of award till the principal amount was deposited in the High  Court  on  03.03.2003.   From  the  said  date  of 03.03.2003  till  it  was  withdrawn,  the  respondent shall be entitled only to the interest accrued on the principal amount in terms of the Fixed Deposit made as per the direction by the High Court.   

However, the respondent shall be entitled to the interest in terms of the award on the balance of the award amount which the appellants failed to deposit in Court, as per the award.   

The  impugned  Judgment  of  the  High  Court  is modified to the above extent.  The Civil Appeals are disposed of with no order as to costs.      

.......................J.               [KURIAN JOSEPH]  

.......................J.               [ARUN MISHRA]  

New Delhi; September 28, 2015.