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NON-REPORTABLE

        IN THE SUPREME COURT OF INDIA          CIVIL APPELLATE JURISDICTION

          CIVIL APPEAL No. 5891 OF 2016        (ARISING OUT OF SLP (C) No. 20397/2014)

NHPC Ltd. …….Appellant(s)

VERSUS

M/s Jai Prakash Associates Ltd.  & Ors. ……Respondent(s)

          J U D G M E N T

Abhay Manohar Sapre, J.

1. Leave granted.

2. This appeal is filed against the final judgment

and  order  dated  06.02.2014  passed  by  the  High

Court  of  Punjab  and  Haryana  at  Chandigarh  in

F.A.O. No. 3607 of 2011 wherein the Single Judge of

the  High  Court  dismissed  the  FAO  filed  by  the

appellant herein, in consequence, affirmed the order

dated 24.12.2010 passed by the Additional District

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Judge,  Faridabad  in  Arbitration  Petition  No.52  of

2010.

3. On 11.08.2014, this Court issued notice of the

appeal to respondent No. 1 confining it to examine

only  the  question  regarding  the  rate  of  interest

awarded by the High Court on the awarded sum to

the respondent.  

4. Therefore,  the  short  question involved in the

appeal  is  whether the rate of  interest awarded by

the High Court on the awarded sum is proper or

not.

5. Having  regard  to  the  short  controversy

involved in the case, it is not necessary to burden

the order by mentioning the facts in detail except to

the extent necessary for the disposal of the appeal.

6. The  appellant-Government  of  India  Company

awarded a contract dated 21.03.2001 to respondent

No.1 for doing some specific civil construction work

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in  the  project-Teesta  V  Hydroelectric  Project  at

Sikkim known as Lot TT-4 civil works.  

7. In  execution  of  the  aforesaid  work,  disputes

regarding non-payment of  dues for the work done

by respondent No.1 and several ancillary disputes

in  connection  thereto  arose  between  the  parties.

Since  the  parties  could  not  amicably  settle  the

disputes  and  hence  they  were  referred  to  the

Arbitral Tribunal in terms of the arbitration clause

contained  in  the  contract.   The  Arbitral  Tribunal

consisted of three arbitrators.

8. Respondent No. 1 filed their claim for recovery

of Rs.537.88 lacs against the appellant before the

Arbitral Tribunal towards their outstanding dues of

various natures.  The appellant contested the claim

of the respondent.

9. By  award  dated  10.05.2008,  the  Arbitral

Tribunal  partly  allowed  the  claim  of  respondent

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No.1 and accordingly awarded them a total sum of

Rs.356.78 lacs. The Arbitral Tribunal also awarded

10% p.a.  simple  interest  payable  on  the  awarded

sum (Rs.356.78  lacs)  from the  date  of  accrual  of

cause of  action till  the date of  award and further

awarded future interest at the rate of 12% p.a. on

the  awarded  sum,  i.e.,  Rs.451.49  lacs  (Rs.356.78

lacs  principal  sum  +  Rs.94.71  lacs  interest  =

Rs.451.49 lacs) payable from the date of award till

recovery.

10. The  appellant,  felt  aggrieved,  challenged  the

legality of the aforesaid award under Section 34 of

the  Arbitration  and  Conciliation  Act,  1996  before

the  Additional  District  Judge,  Faridabad,  who  by

order  dated  24.12.2010  partly  allowed  the

application and modified the award accordingly.  

11. The  appellant,  felt  aggrieved,  challenged  the

order  of  the  Additional  District  Judge  and  filed

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appeal before the High Court.  By impugned order,

the High Court dismissed the appeal and upheld the

order passed by the Additional District Judge.

12.  Felt  aggrieved,  the  appellant  has  filed  this

appeal by way of special leave before this Court.

13. Heard  Mr.  Gaurab  Banerji,  learned  senior

counsel  for  the  appellant  and  Mr.  Sarvjit  Pratap

Singh, learned counsel for respondent No.1.

14. Submission  of  the  learned  counsel  for  the

appellant was only one. According to him, the High

Court while dismissing the appeal and in principle

upholding  of  the  award  of  the  Arbitral  Tribunal

wrongly awarded interest at the rate of 12% p.a. and

18% p.a. in place of 10% and 12% p.a. which was

awarded by the Arbitral Tribunal. It was, therefore,

his submission that this error appears to be more in

the  nature  of  typographical  error  rather  than  on

merits  and  hence  needs  to  be  corrected  by  this

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Court by restoring the same rate of interest which

was awarded by the Arbitral Tribunal in the award

dated 10.05.2008 and upheld by Additional District

Judge  vide  his  order  dated  24.12.2010,  i.e.,  10%

and 12% respectively as detailed above in para 9.  

15. Learned counsel for respondent No.1 candidly

admitted the error committed by the High Court in

the order while awarding the interest. Respondent

No.1 also in their counter at page 204 admitted the

error, which was pointed out by the appellant while

awarding the rate of interest.

16. In our opinion,  the submission urged by the

appellant  appears  to  be  correct  and  hence  it

deserves to be accepted. As mentioned above, even

the respondent could not oppose the prayer made

by the appellant  which appear  to  be more in the

nature of typographical error.

17. In the light of  foregoing discussion,  which is

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sufficient,  the  appeal  succeeds  and  is  allowed  in

part. Impugned order is modified to the extent that

the awarded amount shall carry the interest at the

same  rates  which  were  awarded  by  the  Arbitral

Tribunal  in  the  award  dated  10.5.2008.  In  other

words, the awarded sum shall carry interest at the

rate 10% p.a. payable from the date of accrual of

cause  of  action  till  the  date  of  award  and  shall

further carry interest at the rate of 12% p.a. from

the date of award till recovery on the awarded sum

as detailed in para 9 above.

18. No costs.   

                       ………...................................J.

[J. CHELAMESWAR]

                             …...……..................................J.

 [ABHAY MANOHAR SAPRE] New Delhi; July 04, 2016   

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