As per the case facts, a concession agreement led to a dispute, which DAMEPL terminated. Arbitration ensued, resulting in an award. DMRC challenged this award, but it was upheld by ...
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REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO .3657 OF 2022
[Arising out of Special Leave Petition (Civil) No.4901 of
2022]
DELHI AIRPORT METRO EXPRESS
PRIVATE LIMITED ...APPELLANT(S)
VERSUS
DELHI METRO RAIL CORPORATION ...RESPONDENT(S)
J U D G M E N T
B.R. GAVAI, J.
1.Leave granted.
2.The short question involved in the present appeal is, as to
whether the “sum” awarded under clause (a) of subsection (7)
of Section 31 of the Arbitration and Conciliation Act, 1996
1
(hereinafter referred to as the “1996 Act”) would include the
interest pendente lite or not?
3.The undisputed facts in the present case are as under:
4.On being declared as the successful bidder, a Concession
Agreement dated 25
th
August, 2008 (hereinafter referred to as
“the Concession Agreement”), was entered into between the
appellant–Delhi Airport Metro Express Private Limited
(hereinafter referred to as “DAMEPL”) and the respondentDelhi
Metro Rail Corporation (hereinafter referred to as “DMRC”). As
per the Concession Agreement, the respondentDMRC was to
carry out the civil works (excluding at the Depot) and the
balance works (including the Depot civil works and the Project
systems works) were to be executed by the appellantDAMEPL.
As per Article 29 of the Concession Agreement, in the event of
termination, it was the respondentDMRC, which was liable to
make Termination Payment (as defined in the Concession
Agreement).
2
5.During the course of operations of the project, a dispute
arose between the appellantDAMEPL and the respondent
DMRC. The appellantDAMEPL terminated the Concession
Agreement by Termination Notice dated 8
th
October, 2012. The
respondentDMRC referred the dispute to Arbitration under
Article 36.2 of the Concession Agreement on 23
rd
October,
2012. An Arbitral Award came to be passed on 11
th
May, 2017.
On 12
th
May, 2017, the appellantDAMEPL paid a stamp duty of
Rs.4,72,20,000/ on the Award. Certain interim orders were
also passed in the interlocutory proceedings by the Delhi High
Court. Since the respondentDMRC was aggrieved by the
Award, it filed a Petition under Section 34 of the 1996 Act in
Delhi High Court, being OMP (COMM) No.307 of 2017,
challenging the Arbitral Award dated 11
th
May, 2017. Vide the
judgment and order dated 6
th
March, 2018, the learned Single
Judge of the Delhi High Court upheld the Arbitral Award and
rejected the respondentDMRC’s petition under Section 34 of
the 1996 Act. The said judgment and order dated 6
th
March,
3
2018 came to be challenged by the respondentDMRC 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 15
th
January, 2019. Being
aggrieved thereby, the appellantDAMEPL 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 9
th
September, 2021, vide which the judgment and order dated 15
th
January, 2019, passed by the Division Bench of the Delhi High
Court was set aside.
6.The appellantDAMEPL thereafter immediately filed an
Execution Petition being OMP (ENF.) (COMM) No. 145 of 2021
on 12
th
September, 2021, before the Delhi High Court for
enforcement of the Arbitral Award dated 11
th
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
4
proceedings from time to time. Vide the impugned judgment
and order dated 10
th
March, 2022, the learned Single Judge of
the Delhi High Court issued certain directions with regard to
the payment to be made by the respondentDMRC towards the
satisfaction of the Award. Vide the impugned judgment and
order, the application(s) for impleadment filed by the Canara
Bank and the Union Bank of India came to be rejected. In the
said proceedings, a contention was raised on behalf of the
appellantDAMEPL that the sum, as specified under clause (a)
of subsection (7) of Section 31 of the 1996 Act, would include
interest for a period from the date on which the cause of action
arose to the date on which the award was made. The said
contention was rejected by the learned Single Judge of the
Delhi High Court by the impugned judgment and order. Being
aggrieved thereby, the present appeal by way of special leave.
7.We have heard Shri Harish N. Salve, learned Senior
Counsel appearing on behalf of the appellantDAMEPL and Shri
5
Parag P. Tripathi, learned Senior Counsel appearing on behalf
of the respondentDMRC.
8.Shri Harish N. Salve, learned Senior Counsel, submits
that the issue is no more res integra. The majority judgment of
this court in the case of Hyder Consulting (UK) Limited vs.
Governor, State of Orissa through Chief Engineer
1
has
clearly held that, upon a plain reading of clauses (a) and (b) of
subsection (7) of Section 31 of the 1996 Act, it is clear that in
the sum for which an Award is made, interest may be included
for the preaward period, and that for the postaward period,
interest up to the rate of 18% per annum may be awarded on
such sum directed to be paid by the Arbitral Tribunal. Learned
Senior Counsel, therefore, submits that the amount under
clause (a) of subsection (7) of Section 31 of the 1996 Act would
include the Termination Payment of Rs.2782.33 crores plus the
amount of interest granted by the Arbitral Tribunal from the
date of cause of action till the date of the award. As such, it is
1 (2015) 2 SCC 189
6
the contention of the appellantDAMEPL that the sum, as
specified in clause (a) of subsection (7) of Section 31 of the
1996 Act, would be an amount of Rs.4662.59 crores. It is
further submitted that the sum, which is arrived at Rs.4662.59
on the correct construction of clause (a) of subsection (7) of
Section 31 of the 1996 Act, would therefore carry the interest
as awarded by the Arbitral Tribunal from the 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 appellantDAMEPL with
regard to addition of the interest pendente lite in the sum to be
arrived at under clause (a) of subsection (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 appellantDAMEPL. He submits that
clause (a) of subsection (7) of Section 31 of the 1996 Act itself
7
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
assistance to the case of the appellantDAMEPL. He therefore
submits that the present appeal deserves to be dismissed.
10.As already stated hereinabove, the present appeal needs to
be decided in the narrow compass of interpretation of clause (a)
of subsection (7) of Section 31 of the 1996 Act.
11.Shri Harish N. Salve, learned Senior Counsel is justified in
relying on the majority judgment of this Court in the case of
Hyder Consulting (UK) Limited (supra). S.A. Bobde, J. in his
judgment in the said case observed thus:
8
“2. It is not possible to agree with the
conclusion in S.L. Arora case [State of
Haryana v. S.L. Arora and Co., (2010) 3
SCC 690 : (2010) 1 SCC (Civ) 823] that
Section 31(7) of the Act does not require
that interest which accrues till the date of
the award be included in the “sum” from
the date of award for calculating the post
award interest. In my humble view, this
conclusion does not seem to be in
consonance with the clear language of
Section 31(7) of the Act.
3. Subsection (7) of Section 31 of the Act,
which deals with the power of the Arbitral
Tribunal to award interest, reads as
follows:
“31.(7)(a) Unless otherwise
agreed by the parties, where and
insofar as an arbitral award is for
the payment of money, the
Arbitral Tribunal may include in
the sum for which the award is
made interest, at such rate as it
deems reasonable, on the whole
or any part of the money, 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.
9
(b) A sum directed to be paid by
an arbitral award shall, unless
the award otherwise directs,
carry interest at the rate of
eighteen per centum per annum
from the date of the award to the
date of payment.”
(emphasis supplied)
4. Clause (a) of subsection (7) provides
that where an award is made for the
payment of money, the Arbitral Tribunal
may include interest in the sum for which
the award is made. In plain terms, this
provision confers a power upon the
Arbitral Tribunal while making an award
for payment of money, to include interest
in the sum for which the award is made on
either the whole or any part of the money
and for the whole or any part of the period
for the entire preaward period between
the date on which the cause of action
arose and the date on which the award is
made. To put it differently, subsection (7)
(a) contemplates that an award, inclusive
of interest for the preaward 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
10
subsection (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—A summary
or abstract; a compendium; a collection.
Several of the old law treatises are
called ‘sum’. Lord Hale applies the term
to summaries of statute law. Burrill.
The sense in which the term is most
commonly used is ‘money’; a quantity of
money or currency; any amount
indefinitely, a sum of money, a small
sum, or a large sum. United
11
States v. Van Auken [24 L Ed 852 : 96
US 366 (1878)]
and Donovan v. Jenkins [52 Mont 124 :
155 P 972 at p. 973] .”
7. Thus, when used as a noun, as it seems
to have been used in this provision, the
word “sum” simply means “an amount of
money”; whatever it may include —
“principal” and “interest” or one of the two.
Once the meaning of the word “sum” is
clear, the same meaning must be ascribed
to the word in clause (b) of subsection (7)
of Section 31 of the Act, where it provides
that a sum directed to be paid by an
arbitral award “shall … carry interest …”
from the date of the award to the date of
the payment i.e. postaward. In other
words, what clause (b) of subsection (7) of
Section 31 of the Act directs is that the
“sum”, which is directed to be paid by the
award, whether inclusive or exclusive of
interest, shall carry interest at the rate of
eighteen per cent per annum for the post
award period, unless otherwise ordered.
8. Thus, subsection (7) of Section 31 of
the Act provides, firstly, vide clause (a)
that the Arbitral Tribunal may include
interest while making an award for
payment of money in the sum for which
the award is made and further, vide clause
(b) that the sum so directed to be made by
12
the award shall carry interest at a certain
rate for the postaward period.
9. The purpose of enacting this provision
is clear, namely, to encourage early
payment of the awarded sum and to
discourage the usual delay, which
accompanies the execution of the award in
the same manner as if it were a decree of
the court vide Section 36 of the Act.
10. In this view of the matter, it is clear
that the interest, the sum directed to be
paid by the arbitral award under clause (b)
of subsection (7) of Section 31 of the Act
is inclusive of interest pendente lite.
11. At this juncture, it may be useful to
refer to Section 34 CPC, also enacted by
Parliament and conferring the same power
upon a court to award interest on an
award i.e. postaward interest. While
enacting Section 34 CPC 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 CPC 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
13
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 subsection (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 Tribunal for the pre
award period. Thereupon, the Arbitral
Tribunal may direct interest to be paid on
such “sum” for the postaward period vide
clause (b) of subsection (7) of Section 31
of the Act, at which stage the amount
would be the sum arrived at after the
merging of interest with the principal; the
two components having lost their separate
identities.
14. In fact this is a case where the
language of subsection (7) clauses (a) and
(b) is so plain and unambiguous that no
question of construction of a statutory
14
provision arises. The language itself
provides that in the sum for which an
award is made, interest may be included
for the preaward period and that for the
postaward period interest up to the rate of
eighteen per cent per annum may be
awarded on such sum directed to be paid
by the arbitral award.”
12.Abhay Manohar Sapre, J. in his concurring judgment in
the case of Hyder Consulting (UK) Limited (supra) has also
agreed with the view of S.A. Bobde, J.
13.It could thus be seen that the majority view of this Court
in the case of Hyder Consulting (UK) Limited (supra) is that
the sum awarded may include the principal amount and such
interest as the Arbitral Tribunal deems fit. It is further held
that, if no interest is awarded, the “sum” comprises only the
principal amount. The majority judgment held that clause (a)
of subsection (7) of Section 31 of the 1996 Act refers to the
total amount or sum for the payment for which the award is
made. As such, the amount awarded under clause (a) of sub
section (7) of Section 31 of the 1996 Act would include the
15
principal amount plus the interest amount pendente lite. It was
held that the interest to be calculated as per clause (b) of sub
section (7) of Section 31 of the 1996 Act would be on the total
sum arrived as aforesaid under clause (a) of subsection (7) of
Section 31 of the 1996 Act. S.A. Bobde, J. in his judgment, has
referred to various authorities of this Court as well as Maxwell
on the Interpretation of Statutes. He emphasized that the Court
must give effect to the plain, clear and unambiguous words of
the legislature and it is not for the Courts to add or subtract
the words, even though the construction may lead to strange or
surprising, unreasonable or unjust or oppressive results.
14.Subsection (7) of Section 31 of the 1996 Act is already
reproduced in the judgment of S.A. Bobde, 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 subsection (7) of Section 31 of the 1996 Act, is
as under:
16
(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
17
Tribunal would lose its discretion to award interest and will
have to be guided by the agreement between the parties. The
provision is clear that the Arbitral Tribunal is not bound to
award interest. It has a discretion to award the interest or not
to award. It further has a discretion to award interest at such
rate as it deems reasonable. It further has a discretion to award
interest on the whole or any part of the money. It is also not
necessary for the Arbitral Tribunal to award interest for the
entire period between the date on which the cause of action
arose and the date on which the award is made. It can grant
interest for the entire period or any part thereof or no interest
at all.
16.We find that in the present case, the words “unless
otherwise agreed by the parties” would assume significance.
The said words fell for consideration before this Court in the
case of N.S. Nayak & Sons vs. State of Goa
2
. This Court in
the said case had an occasion to consider the scope of the
2 (2003) 6 SCC 56
18
phrase “unless otherwise agreed by the parties” in various
provisions of the 1996 Act. This Court observed thus:
“14. … The phrase ‘unless otherwise
agreed by the parties’ used in various
Sections, namely, 17, 21, 23(3), 24(1), 25,
26, 29, 31, 85(2)(a), etc. indicates that it is
open to the parties to agree otherwise.
During the arbitral proceedings, right is
given to the parties to decide their own
procedure. So if there is an agreement
between the parties with regard to the
procedure to be followed by the arbitrator,
the arbitrator is required to follow the said
procedure. Reason being, the arbitrator is
appointed on the basis of the contract
between the parties and is required to act
as per the contract. However, this would
not mean that in appeal parties can
contend that the appellate procedure
should be as per their agreement.”
17.This Court in the case of Sree Kamatchi Amman
Constructions vs. Divisional Railway Manager (Works),
Palghat and others
3
had an occasion to directly consider the
aforesaid phrase as employed by the legislature in subsection
(7) of Section 31 of the 1996 Act. R.V. Raveendran, J. in the
said case observed thus:
3 (2010) 8 SCC 767
19
“19. Section 31(7) of the new Act by
using the words ‘unless otherwise agreed
by the parties’ categorically clarifies that
the arbitrator is bound by the terms of
the contract insofar as the award of
interest from the date of cause of action
to the date of award. Therefore, where
the parties had agreed that 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 subsection (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 subsection (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
20
Arbitral Tribunal would have a discretion to exercise its powers
under clause (a) of subsection (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 raised on behalf of the appellant
DAMEPL is to be accepted, the phrase “unless otherwise agreed
by the parties” would be rendered redundant and would
become otiose.
20.It will be apposite to refer to the following observation of
this Court in the case of Reserve Bank of India vs. Peerless
General Finance and Investment Co. Ltd. and others
4
:
“33. Interpretation must depend on the
text and the context. They are the bases
of interpretation. One may well say if the
text is the texture, context is what gives
the colour. Neither can be ignored. Both
are important. That interpretation is best
which makes the textual interpretation
4 (1987) 1 SCC 424
21
match the contextual. A statute is best
interpreted when we know why it was
enacted. With this knowledge, the
statute must be read, first as a whole
and then section by section, clause by
clause, phrase by phrase and word by
word. If a statute is looked at, in the
context of its enactment, with the glasses
of the statutemaker, provided by such
context, its scheme, the sections,
clauses, phrases and words may take
colour and appear different than when
the statute is looked at without the
glasses provided by the context. With
these glasses we must look at the Act as
a whole and discover what each section,
each clause, each phrase and each word
is meant and designed to say as to fit
into the scheme of the entire Act. No part
of a statute and no word of a statute can
be construed in isolation. Statutes have
to be construed so that every word has a
place and everything is in its place. It is
by looking at the definition as a whole in
the setting of the entire Act and by
reference to what preceded the
enactment and the reasons for it that the
Court construed the expression “Prize
Chit” in Srinivasa [(1980) 4 SCC 507 :
(1981) 1 SCR 801 : 51 Com Cas 464] and
we find no reason to depart from the
Court's construction.”
21.It could thus be seen that each and every word and each
and every phrase mentioned in the provision will have to be
22
given effect to. Statutes have to be construed so that every
word has a place and everything is in its place.
22.An important aspect that has to be taken into
consideration is that the 1996 Act itself emphasizes on party
autonomy. As such, the legislative intent is clear that when the
parties have agreed to the contrary on any of the aspects as
mentioned in clause (a) of subsection (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
vs. State of Punjab and others
5
:
“44. No word in a statute has to be
construed as surplusage. No word can be
rendered ineffective or purposeless.
5 (2014) 3 SCC 92
23
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 that the
provision had been enacted without any
purpose and the entire exercise to enact
such a provision was “most unwarranted
besides being uncharitable”. (Vide Patel
Chunibhai Dajibha v. Narayanrao
Khanderao Jambekar [AIR 1965 SC
1457] , Martin Burn Ltd. v. Corpn. of
Calcutta [AIR 1966 SC 529] , M.V.
Elisabeth v. Harwan Investment and
Trading (P) Ltd. [1993 Supp (2) SCC 433 :
AIR 1993 SC 1014] , Sultana
Begum v. Prem Chand Jain [(1997) 1 SCC
373] , State of Bihar v. Bihar Distillery
Ltd. [(1997) 2 SCC 453 : AIR 1997 SC
1511] , Institute of Chartered
Accountants of India v. Price
Waterhouse [(1997) 6 SCC 312]
and South Central Railway Employees
Coop. Credit Society Employees'
Union v. Registrar of Coop.
24
Societies [(1998) 2 SCC 580 : 1998 SCC
(L&S) 703 : AIR 1998 SC 703] .)”
24.If the interpretation, as placed by the appellantDAMEPL
is to be accepted, the phrase “unless otherwise agreed by the
parties” would be reduced to a “dead letter” or “useless lumber”.
In our considered view, such an interpretation would be wholly
impermissible.
25.It appears from the facts in the case of Hyder Consulting
(UK) Limited (supra) that there was no agreement between the
parties with regard to payment of interest. Such is not the case
here. It will be relevant to refer to Article 29.8 of the
Concession Agreement, which reads thus:
“29.8 Termination Payments: The
Termination Payment pursuant
to this Agreement shall become
due and payable to the
Concessionaire by DMRC within
thirty days of a demand being
made by ∙the Concessionaire
with the necessary particulars
duly certified by the Statutory
Auditors. If DMRC fails to
disburse the full Termination
25
Payment within 30 (thirty) days,
the amount remaining unpaid
shall be disbursed along with
interest at an annualised rate of
SBI PLR plus two per cent for
the period of delay on such
amount.”
26.It could thus clearly be seen that as per Article 29.8 of the
Concession Agreement, the Termination Payment would
become due and payable to the Concessionaire by DMRC within
thirty days of a demand being made by the Concessionaire. It
further provides that if the DMRC fails to disburse the full
Termination Payment within 30 days, the amount remaining
unpaid shall be disbursed along with interest at an annualized
rate of SBI PLR plus two per cent for the period of delay on
such amount. It can thus clearly be seen that 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:
26
“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
CD11Supplementary 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
Termination payment by DAMEPL
on 08.07.2013). In terms of Article
29.9 of CA, this amount shall be
paid by DMRC by way of credit to
27
the Escrow Account, details of
which are available in Annexure
CC4 of the Counter Claim. We
award accordingly.
28.It is thus clear that the Arbitral Tribunal has directed that
the Termination payment would be as per the provisions of the
Concession Agreement and the interest on the Termination
payment would accrue from 7
th
August, 2013 (i.e., the date 30
days after the demand of Termination payment by DAMEPL on
8
th
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 appellantDAMEPL was on the lower side. The
Arbitral Tribunal, therefore, has rightly given effect to the
28
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
subsection (7) of Section 31 of the 1996 Act and specifically, in
consonance with the phrase “unless otherwise agreed by the
parties”.
29.As already discussed herein above, from the majority
judgment of S.A. Bobde and Abhay Manohar Sapre, JJ. in the
case of Hyder Consulting (UK) Limited (supra), it would
appear that the situation, where there was an agreement
between the parties on the point of payment of interest, did not
fall for consideration in the said case.
30.We may gainfully refer to the threejudge Bench judgment
of this Court in the case of Union of India and others vs.
Dhanwanti Devi and others
6
, wherein this Court has
observed thus:
6 (1996) 6 SCC 44
29
“9. …..Every judgment must be read as
applicable to the particular facts proved, or
assumed to be proved, since the generality
of the expressions which may be found
there is not intended to be exposition of
the whole law, but governed and qualified
by the particular facts of the case in which
such expressions are to be found…”
31.It can thus clearly be seen that every 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 threeJudge Bench of this Court in the case of The
Regional Manager and another vs. Pawan Kumar Dubey
7
:
“7. ……Even where there appears to be
some conflict, it would, we think, vanish
when the ratio decidendi of each case is
7 (1976) 3 SCC 334
30
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
circumstances of a case which constitutes its ratio decidendi
and not some conclusion based upon facts which may appear
to be similar. It has been held that 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.
34.As discussed hereinabove, in the case of Hyder
Consulting (UK) Limited (supra), there was no agreement
between the parties with regard to the payment of interest and
as such, the phrase “unless otherwise agreed by the parties”
31
did not fall for consideration in the said case. As a caution, we
have also gone through the judgment of the High Court from
which the appeal arose to this Court in the case of Hyder
Consulting (UK) Limited (supra). A perusal of the said
judgment would also reveal that there was no agreement
between the parties with regard to payment of interest. As
such, in the case of Hyder Consulting (UK) Limited (supra),
this Court did not have an occasion to consider the import of
the phrase “unless otherwise agreed by the parties”.
35.We are therefore of the considered view that 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 directed
by the Arbitral Tribunal. The findings recorded by the Arbitral
Tribunal have reached finality in view of the judgment and
order dated 9
th
September, 2021, passed by this Court in Civil
Appeal No.5627 of 2021 [arising out of Special Leave Petition
(Civil) No.4115 of 2019].
32
36.We therefore, see no error in the observations of the
learned Single Judge of the Delhi High Court in paragraph 30 of
the impugned judgment and order dated 10
th
March, 2022,
passed in Execution Petition being OMP (ENF.) (COMM) No. 145
of 2021.
37.In the result, we find no merit in the present appeal. The
appeal is accordingly dismissed.
38.Pending application(s), if any, shall stand disposed of.
There shall be no order as to costs.
…..….......................J.
[L. NAGESWARA RAO]
…….........................J.
[B.R. GAVAI]
NEW DELHI;
MAY 05, 2022.
33
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