EXECUTIVE ENGINEER IRRIGATION GALIMALA & ORS. versus ABAADUTA JENA

EXECUTIVE ENGINEER IRRIGATION GALIMALA & ORS. versus ABAADUTA JENA

An arbitrator in references made without court intervention cannot award pendente lite interest and, in cases arising before Interest Act 1978, cannot award pre-reference interest unless supported by contract, trade usage, or statute; courts may go behind the award if no legal basis for interest exists.

Parties
Petitioner: Executive Engineer Irrigation Galimala & Ors.; Respondent: Abaaduta Jena
Jurisdiction
India
Judgment Date
22 September 1987
Procedural Posture
Civil Appeal / Supreme Court Decision on Appeal by Special Leave
Outcome
Appeals partly allowed and partly dismissed; award of interest disallowed as indicated.
Legal Topics
Arbitrator's Power to Award Interest, Interest on Arbitration Awards, Interest Act Interpretation, Section 34 CPC and Arbitration
Arbitration Law Contract Law Civil Procedure Arbitrator's Power to Award Interest Interest on Arbitration Awards Interest Act Interpretation Section 34 CPC and Arbitration

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Parties

Executive Engineer Irrigation Galimala & Ors.

Petitioner

Abaaduta Jena

Respondent

Procedural Posture

Civil Appeal / Supreme Court Decision on Appeal by Special Leave

Legal Issues

  1. 1 Can an arbitrator, in references made without court intervention, award interest for periods prior to reference and during pendency?
  2. 2 Is the court entitled to go behind arbitration awards and decide whether award of interest is justifiable?

Ratio Decidendi

An arbitrator in references made without court intervention cannot award pendente lite interest and, in cases arising before Interest Act 1978, cannot award pre-reference interest unless supported by contract, trade usage, or statute; courts may go behind the award if no legal basis for interest exists.

Court Disposition

Appeals partly allowed and partly dismissed; award of interest disallowed as indicated.

Orders

  • Civil Appeal Nos. 120 and 121 of 1981 dismissed.
  • Civil Appeal Nos. 6019-22 of 1983 and Civil Appeal No. 2257 of 1984 allowed to extent that pendente lite interest is disallowed.