MORGAN SECURITIES AND CREDITS PVT. LTD. versus VIDEOCON INDUSTRIES LTD.

MORGAN SECURITIES AND CREDITS PVT. LTD. versus VIDEOCON INDUSTRIES LTD.

The arbitrator has the discretion to grant post-award interest and to determine the sum on which it is payable (including the ability to grant it on part of the sum); the phrase 'unless the award otherwise directs' in s.31(7)(b) qualifies the rate of statutory post-award interest (18%) where the arbitrator is silent, and does not restrict the arbitrator's inherent discretion to award post-award interest on a part of the sum; the arbitrator must exercise that discretion reasonably and in good faith.

Parties
Appellant: Morgan Securities and Credits Pvt. Ltd.; Respondent: Videocon Industries Ltd.
Jurisdiction
India
Judgment Date
01 September 2022
Procedural Posture
Civil Appeal / Appeal From Division Bench of the Delhi High Court; Supreme Court Grant of Special Leave Confined to Issue of Post Award Interest; Final Judgment on Appeal
Outcome
Appeal dismissed
Legal Topics
Post Award Interest, Pre Award Interest, Interpretation of Section 31(7) of the Arbitration and Conciliation Act, 1996, Discretion of Arbitrator
Arbitration Civil Procedure Post Award Interest Pre Award Interest Interpretation of Section 31(7) of the Arbitration and Conciliation Act, 1996 Discretion of Arbitrator

Case Brief

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Parties

Morgan Securities and Credits Pvt. Ltd.

Appellant

Videocon Industries Ltd.

Respondent

Procedural Posture

Civil Appeal / Appeal From Division Bench of the Delhi High Court; Supreme Court Grant of Special Leave Confined to Issue of Post Award Interest; Final Judgment on Appeal

Legal Issues

  1. 1 Whether an arbitrator has the discretion to grant post-award interest on part of the sum awarded under Section 31(7) of the Arbitration and Conciliation Act, 1996
  2. 2 Whether the phrase 'unless the award otherwise directs' in Section 31(7)(b) limits the arbitrator's discretion to determine the 'sum' on which post-award interest is payable or only qualifies the rate of interest
  3. 3 Whether post-award interest must be calculated on the aggregate of principal and pre-award interest per Hyder Consulting

Ratio Decidendi

The arbitrator has the discretion to grant post-award interest and to determine the sum on which it is payable (including the ability to grant it on part of the sum); the phrase 'unless the award otherwise directs' in s.31(7)(b) qualifies the rate of statutory post-award interest (18%) where the arbitrator is silent, and does not restrict the arbitrator's inherent discretion to award post-award interest on a part of the sum; the arbitrator must exercise that discretion reasonably and in good faith.

Court Disposition

Appeal dismissed

Orders

  • Appeal against the judgment of the Delhi High Court dated 26 February 2020 dismissed
  • All pending applications, if any, are disposed of