TEHRI HYDRO DEV. CORPN. LTD.& ANR. versus JAI PRAKASH ASSO. LTD.

TEHRI HYDRO DEV. CORPN. LTD.& ANR. versus JAI PRAKASH ASSO. LTD.

The claims of the respondent-contractor for specific quantified amounts, Rs.10,17,461/- and Rs.12.50 lakhs, were not barred by an earlier arbitration proceeding, as the claims crystallized after the final bill was prepared and referred to arbitration. However, the claim for Rs.12.50 lakhs was not arbitrable and...

Source-derived case information.

Parties
Appellant: Tehri Hydro Development Corporation Ltd. & Anr.; Respondent: Jai Prakash Associates Ltd.
Jurisdiction
India
Judgment Date
25 September 2012
Procedural Posture
Civil Appeal / Supreme Court Appeal From High Court Judgment
Outcome
Appeal partly allowed; orders of courts below modified.
Legal Topics
Arbitration Maintainability, Arbitral Award, Interest on Arbitral Award, Challenge to Arbitral Award, Contractual Bar to Interest
Arbitration Contract Law Arbitration Maintainability Arbitral Award Interest on Arbitral Award Challenge to Arbitral Award Contractual Bar to Interest

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Parties

Tehri Hydro Development Corporation Ltd. & Anr.

Appellant

Jai Prakash Associates Ltd.

Respondent

Procedural Posture

Civil Appeal / Supreme Court Appeal From High Court Judgment

Legal Issues

  1. 1 Whether second round of arbitration proceedings was maintainable.
  2. 2 Whether claim for refund of security deposit was arbitrable and could be decreed.
  3. 3 Whether grant of interest pendente lite was justified given contractual bar.

Ratio Decidendi

The claims of the respondent-contractor for specific quantified amounts, Rs.10,17,461/- and Rs.12.50 lakhs, were not barred by an earlier arbitration proceeding, as the claims crystallized after the final bill was prepared and referred to arbitration. However, the claim for Rs.12.50 lakhs was not arbitrable and could not have been decreed by the trial court or remanded by the High Court to an arbitrator nominated by it; it must be worked out as per procedure agreed between the parties. Clauses 1.2.14 and 1.2.15 of the contract imposed a clear bar on grant of interest, making pendente lite interest unjustified, but post-award interest at 12% per annum was rightly awarded.

Court Disposition

Appeal partly allowed; orders of courts below modified.

Orders

  • Award of Rs.10,17,461/- in favour of respondent-contractor is maintained.
  • Decree for Rs.12.50 lakhs reversed; claim not to be adjudicated by arbitrator nominated by High Court; parties to resolve issue as per contract procedure.