Allahabad High Court
Aligarh Muslim University vs Vii Addl.Distt. And Sessions ... on 27 January, 2023
Bench: Rohit Ranjan Agarwal
HIGH COURT OF JUDICATURE AT ALLAHABAD
?Court No. - 10
Case :- WRIT - C No. - 49486 of 1999
Petitioner :- Aligarh Muslim University
Respondent :- Vii Addl.Distt. And Sessions Judge Aligarh And Others
Counsel for Petitioner :- Dilip Gupta,Shashank Shekhar Singh,Teerath Raj Shukla
Counsel for Respondent :- C.S.C.
Hon'ble Rohit Ranjan Agarwal,J.
Heard Sri Teerath Raj Shukla, learned counsel for the petitioner and learned Standing Counsel for respondents no.1 and 2.
The short controversy engaging attention of the Court through this writ petition is as to whether the respondents no.3 to 5 are entitled to damages on the delayed payment on the awarded amount from the date of award or on the principal amount of the claim of the respondents no.3 to 5 from the date when the contractor was stopped from making construction.
The respondent no.3, who is a contractor raised a dispute which was referred to the sole arbitrator, who vide award dated 12.09.1978 made an award of Rs.50,533.44/- in favour of the contractor and the University was required to pay amount within one month. The said amount was paid by the University through cheque on 18.10.1978. The contractor filed an application before the Court for making the award/rule of the Court, and the same was registered as Original Suit No.108 of 1979. The second Additional Civil Judge (S.D.), Aligarh, on 02.03.1981, allowed the application.
After about 10 years, an Execution Case No.12 of 1991 was filed by the contractor/respondent no.3. The petitioner/University filed its objection under Section 47 of the Code of Civil Procedure, which was rejected by the order dated 06.07.1996. The Court awarded interest @ 10% per annum from 12.10.1972 to 17.10.1978, and also awarded interest @ 10% from 18.03.1981 to 27.03.1991.
Against the said order, a Civil Revision No.53 of 1996 was preferred by the University before the Court below which has been dismissed vide order dated 02.11.1999, hence the present writ petition.
Learned counsel for the petitioner contended that the award only mentioned for the damages to be paid by the University in case the awarded amount was not paid within one month from the date of award i.e. 12.09.1978. He further contended that the award did not provide rate of interest to be paid to the contractor in case of delay.
Per contra, learned Standing Counsel appearing for the State defended the order passed by the Court below and submitted that as there was delay in payment of the amount by the University, the Court had rightly awarded the interest from 1972 when the work was stopped by the University till date of award and thereafter, from the date of filing of the application till date of judgment/order passed in the execution proceedings.
Having heard learned counsel for the parties and perusing the material on record, I find that the award given by the sole arbitrator mentions for the payment of the awarded amount, and not the principal amount.
Had it been the case that the arbitrator had awarded the principal amount then the respondent no.3/contractor would have been entitled for interest from the date when the work was stopped by the University in the year 1972. The word "damages" used by the arbitrator in his award to be paid to the contractor in case awarded amount is not paid within one month, is indicative to the fact that the period for which the respondent no.3 shall be entitled for damages is from the date of award which is 12.09.1978. The delay on the part of the University is only of six days' as it was required to deposit the amount within 30 days which ended on 11.10.1978, while the entire payment was made on the awarded amount on 18.10.1978. There is no denial to the fact that the amount was tendered by the University after expiry of seven days as provided in the award.
The order passed by the Courts below dated 06.07.1996 and 02.11.1999 are unsustainable in the eyes of law as the Courts have exceeded its jurisdiction in granting 10% interest from 1972 onwards. The arbitrator had clearly held that the contractor was entitled for damages on the delayed payment of the awarded amount. The award was made on 12.09.1978. The Court below had taken into consideration the principal amount, which was the claim of the contractor as of year 1972 to be the awarded amount.
There is a distinction between the awarded amount and the claim of the contractor. The awarded amount is what is mentioned in the award of the arbitrator, while the claim mentions the amount in the statement of fact which is placed before the arbitrator for consideration.
Once, the award is clear to the extent that the damages were to be paid on the awarded amount and not on the principal amount, the findings recorded by both the Courts below are unsustainable in the eyes of law, and the orders dated 06.07.1996 and 02.11.1999 are hereby set aside.
The writ petition succeeds and is, hereby, allowed.
The respondent no.3 is only entitled for the damages for the delayed payment of award for six days.
Order Date :- 27.1.2023
SK Goswami
