Delhi Airport Metro Express Private Limited v. Delhi Metro Rail Corporation
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 sub-section (7) of Section 31 of
the Arbitration and Conciliation Act, 1996 (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:
721
4. On being declared as the successful bidder, a Concess ion
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 respondent-Delhi Metro Rail Corpo ration
(hereinafter referred to as “DMRC”). As per the Concession Agreement,
the respondent-DMRC was to carry out the civil works (e xcluding at
the Depot) and the balance works (including the Depot civil works and
the Project systems works) were to be executed by the appellant-
DAMEPL. As per Article 29 of the Concession Agreement, in the event
of termination, it was the respondent-DMRC, which was liable to make
Termination Payment (as defined in the Concession Agreement).
5. During the course of operations of the project, a dispute arose
between the appellant-DAMEPL and the respondent-DMR C. The
appellant-DAMEPL terminated the Concession Agreemen t by
Termination Notice dated 8 th October, 2012. The respondent-DMRC
referred the dispute to Arbitration under Article 36.2 of the Concession
Agreement on 23rd October, 2012. An Arbitral Award came to be passed
on 11th May, 2017. On 12th May, 2017, the appellant-DAMEPL 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 Del hi High
Court. Since the respondent-DMRC was aggrieved by the Award, i t
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 respondent-DMRC’s petition under Section 34
of the 1996 Act. The said judgment and order dated 6 th 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 (O S)
(COMM) No. 58 of 2018. The said appeal was partly allowed b y the
Division Bench of the Delhi High Court vide the judgment and order
dated 15 th January, 2019. Being aggrieved thereby, the appell ant-
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.
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
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 tim e. Vide the
impugned judgment and order dated 10th March, 2022, the learned Single
Judge of the Delhi High Court issued certain directions with re gard to
the payment to be made by the respondent-DMRC towar ds the
satisfaction of the Award. Vide the impugned judgment and order, t he
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 appellant-DAMEPL that the sum, as specified
under clause (a) of sub-section (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 conten tion
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 appellant-DAMEPL and Shri Parag P. Tripathi,
learned Senior Counsel appearing on behalf of the respondent-DMRC.
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 Engineer1 has clearly held that, upon a plain reading of
clauses (a) and (b) of sub-section (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 pre-award period, and that for the post-award 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, theref ore,
submits that the amount under clause (a) of sub-section (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 su ch, it is the
contention of the appellant-DAMEPL that the sum, as specified in clause
(a) of sub-section (7) of Section 31 of the 1996 Act, would be an amount
1 (2015) 2 SCC 189
723
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 sub-secti on
(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 t he 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-s ection (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 speci fic agreement
between the parties under Article 29.8 of the Concession Agreeme nt,
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 appellant-D AMEPL.
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 sub-
section (7) of Section 31 of the 1996 Act.
11. Shri Harish N. Salve, learned Senior Counsel is justified i n
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:
“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.
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
3. Sub-section (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.
(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 sub-section (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 te rms,
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 pre-award period between the date on which the cause of
action arose and the date on which the award is made. To put it
differently, sub-section (7)( a) contemplates 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.
725
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 lar ge
sum. United 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 sub-
section (7) of Section 31 of the Act, where it provide s 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. post-award. In other words, what clause ( b) of sub-section
(7) of Section 31 of the Act directs is that the “sum”, whi ch 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, sub-section (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 the award shall carry interest at a certain rate for
the post-award period.
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
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 Sectio n
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 sub-
section (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. post-award inter est.
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 intended to have a different effec t. 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 t he 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 witho ut
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 pa id by
the Arbitral Tribunal for the pre-award period. Thereupon, t he
Arbitral Tribunal may direct interest to be paid on such “sum” for
the post-award period vide clause (b) of sub-section (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.
727
14. In fact this is a case where the language of sub-section (7 )
clauses (a) and (b) is so plain and unambiguous that no question
of construction of a statutory provision arises. The language itself
provides that in the sum for which an award is made, interest may
be included for the pre-award period and that for the post-award
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 awar ded, the
“sum” comprises only the principal amount. The majority judgment held
that clause (a) of sub-section (7) of Section 31 of the 1996 Act refers to
the total amount or sum for the payment for which the award is mad e.
As such, the amount awarded under clause (a) of sub-section (7) of
Section 31 of the 1996 Act would include the 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 sub-section
(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 thou gh the
construction may lead to strange or surprising, unreasonable or unjust or
oppressive results.
14. Sub-section (7) of Section 31 of the 1996 Act is alread y
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 sub-se ction (7) of
Section 31 of the 1996 Act, is as under:
(i) It begins with the words “Unless otherwise agreed by the
parties”;
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
(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 pe riod
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 i f it is not
otherwise agreed by the parties. If there is an agreemen t 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 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 fel l
for consideration before this Court in the case of N.S. Nayak & Sons
vs. State of Goa2. This Court in the said case had an occasion to consider
the scope of the phrase “unless otherwise agreed by the pa rties” 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 ag ree
otherwise. During the arbitral proceedings, right is given t o the
parties to decide their own procedure. So if there is an agreement
between the parties with regard to the procedure to be foll owed
by the arbitrator, the arbitrator is required to follow the said
2 (2003) 6 SCC 56
729
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 the ir
agreement.”
17. This Court in the case of Sree Kamatchi Amman
Constructions vs. Divisional Railway Manager (Works), Palghat and
others3 had an occasion to directly consider the aforesaid phrase as
employed by the legislature in sub-section (7) of Section 31 of the 1996
Act. R.V . Raveendran, J. in the said case observed thus:
“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 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 th e contrary
between the parties. The phrase “unless otherwise agreed by the parties”
clearly emphasizes that when the parties have agreed wit h 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 hav e any
discretion with regard to the aspects mentioned in the sai d 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 raised on behalf of the appellant-DAMEPL
is to be accepted, the phrase “unless otherwise agreed by t he parties”
would be rendered redundant and would become otiose.
3 (2010) 8 SCC 767
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
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 m akes the
textual interpretation match the contextual. A statut e is best
interpreted when we know why it was enacted. With t his
knowledge, the statute must be read, first as a whole and then
section by section, clause by clause, phrase by phrase and w ord
by word. If a statute is looked at, in the context of its enactment,
with the glasses of the statute-maker, provided by such cont ext,
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 glasse s
we must look at the Act as a whole and discover what ea ch
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 defini tion as a
whole in the setting of the entire Act and by reference to what
preceded the enactment and the reasons for it that th e 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 given effect to.
Statutes have to be construed so that every word has a p lace 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 sub -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.
4 (1987) 1 SCC 424
731
23. As already discussed hereinabove, any interpretation w hich
would render the phrase “unless otherwise agreed by the parties” otiose
or redundant will have to be avoided. It will be apposite to refer t o 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. Courts are
required to carry out the legislative intent fully and comp letely.
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. Societies [(1998) 2 SCC 580 : 1998
SCC (L&S) 703 : AIR 1998 SC 703].)”
24. If the interpretation, as placed by the appellant-DAMEPL i s
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
5 (2014) 3 SCC 92
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GA VAI, J.]
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 Statutor y
Auditors. If DMRC fails to disburse the full Termination
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 du e
and payable to the Concessionaire by DMRC within thirty days of a
demand being made by the Concessionaire. It further provides t hat 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 Artic le 29.8 of the
Concession Agreement deals with payment of interest on Termination
Payment amount.
27. The Arbitral Tribunal rightly construing the Conces sion
Agreement has directed thus:
“129. Therefore, the Termination Payment to DAMEPL
works out to Rs. 983.02 +Rs. 1260.73 +Rs. 538.58 cror es
=Rs. 2782.33 crores.
As regards rate of interest on the Termination paymen t, the
stipulation of Article 29.8 of CA is at an annualized rate of SBI
PLR +2%. We have noted from the financial documents o f
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 opinio n
that it is beyond the competence of the Tribunal to change or alter
733
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 payme nt
will accrue from 7.8.2013 (i.e. the date 30 days afte r the
demand of Termination payment by DAMEPL on
08.07.2013). In terms of Article 29.9 of CA, this am ount
shall be paid by DMRC by way of credit to the Escro w
Account, details of which are available in Annexure CC-4
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 dema nd 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 A rbitral
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”.
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 three-judge Bench judgment of
this Court in the case of Union of India and others vs. Dhanwanti
Devi and others6, wherein this Court has observed thus:
6 (1996) 6 SCC 44
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GAVAI, J.]
“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 t he
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 three-Judge 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 correctly
understood. It is the rule deducible from the application of law to
the facts and circumstances of a case which constitutes i ts 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 eac h 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 phra se “unless
otherwise agreed by the parties” 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
7 (1976) 3 SCC 334
735
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 Arti cle 29.8
of the Concession Agreement, as has been directed by th e 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].
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 10th 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. T he
appeal is accordingly dismissed.
38. Pending application(s), if any, shall stand disposed of. There
shall be no order as to costs.
Nidhi Jain Appeal dismissed.
(Assisted by : Shashwat Jain, LCRA)
DELHI AIRPORT METRO EXPRESS PRIVATE LIMITED v.
DELHI METRO RAIL CORPORATION [B. R. GAVAI, J.]