Madras High Court
Globe Ground India Private Limited vs Airports Authority Of India on 2 April, 2025
Author: Abdul Quddhose
Bench: Abdul Quddhose
Arb.O.P (Com.Div.) No.312 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 02.04.2025
CORAM
THE HON'BLE Mr. JUSTICE ABDUL QUDDHOSE
Arb.O.P (Com.Div.) No.312 of 2023
Globe Ground India Private Limited,
rep. by its Authorised Signatory ... Petitioner
Versus
1.Airports Authority of India,
Rajiv Gandhi Bhawan,
Safdarjung Airport,
New Delhi.
2.Airport Director,
Airport Authority of India,
Chennai Airport,
Chennai. ... Respondents
Prayer: Arbitration Original Petition (Commercial Division) filed under
Section 34(2)(a)(ii) & 34(2)(b)(ii) of the Arbitration and Conciliation Act,
1996 to set aside the Award dated 18.05.2023 passed by the learned Sole
Arbitrator in respect of the disputes between the petitioner and the first
respondent under the License Agreement dated 27.07.2016.
For Petitioner : Mr.Anirudh Krishnan
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Arb.O.P (Com.Div.) No.312 of 2023
For Respondents : Ms.Preethi Mohan
ORDER
This petition has been filed under Section 34 of the Arbitration and
Conciliation Act, challenging the impugned Arbitral Award dated
18.05.2023.
2.This petition is being re-heard by this Court pursuant to the order of
remand passed by the Hon'ble Division Bench of this Court through its order
dated 24.09.2024 passed in O.S.A. (CAD) No. 56 of 2024 and C.M.P.
No.12717 of 2024. By the said order, the Division Bench of this Court has
made it clear that this Court will have to decide on the sole question as to
whether the Arbitrator in the impugned arbitral award has decided the
interest component correctly or not, since the said contention was not raised
by the petitioner earlier, while this Court was hearing this petition at the first
instance. The order passed by the Division Bench is a consent order.
3.Learned counsel for the petitioner, after drawing attention of this
Court to the impugned arbitral award, would submit that dual rate of interest
as directed by the Arbitrator in the impugned Arbitral Award is not
permissible under law. To support the said proposition, the learned counsel
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Arb.O.P (Com.Div.) No.312 of 2023
for the petitioner drew the attention of this Court to a judgment of the
Hon'ble Supreme Court in the case of Vedanta Limited vs. Shenzhen
Shandong Nuclear Power Construction Company Limited reported in
2019 11 SCC 465. Relying upon paragraph Nos.14 and 15 of the said
decision, the learned counsel for the petitioner would submit that dual rate of
interest awarded by the Arbitrator under the impugned Arbitral Award is
un-justified and therefore, the same has to be set aside by this Court.
4.On the other hand, the learned counsel for the respondents would
submit that the decision relied upon by the learned counsel for the petitioner
has no bearing for the facts of the instant case. She would submit that in the
instant case, in the impugned arbitral award, separate rates of interest has
been granted pre and post passing of the impugned arbitral award. She drew
the attention of this Court to the impugned arbitral award and would submit
that the petitioner was directed to pay the interest at the rate of 8% prior to
the date of the impugned arbitral award and was directed to pay compound
interest at the rate of 10% post the passing of the impugned arbitral award.
Therefore, she would submit that the decision, relied upon by the learned
counsel for the petitioner, in Vedanta Limited case, referred to supra, has no
applicability for the facts of the instant case as that was the case dealing with
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dual rates of interest awarded for the very same period and it is not so in the
instant case. Learned counsel for the respondents also drew the attention of
this Court to a judgment of the Hon'ble Supreme Court in the case of
Reliance Infrastructure Ltd. vs. State of Goa reported in 2023 SCC
Online SC 604 and in particular, she referred to paragraph Nos.33 and 34
and would submit that Vedanta Limited case has been clearly distinguished
in the said decision and in Reliance Infrastructure case, it has been held that
awarding of interest for different periods at different rates is legally
permissible under law.
5.This Court, after giving due consideration to the submissions made
by both the counsels, is of the considered view that there is no ground made
out by the petitioner for challenging the impugned Arbitral Award under
Section 34 of the Arbitration and Conciliation Act in view of the settled law
that the Arbitrator can award interest at different rates for different periods
as seen from the decision rendered by the Hon'ble Supreme Court in
Reliance Infrastructure case.
6.The decision relied upon by the learned counsel for the petitioner
has no applicability to the facts of the instant case as in that case the Hon'ble
Supreme Court was dealing with a case, where dual interest rates were
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awarded for the very same period and further the Hon'ble Supreme Court
was dealing with a case involving International Commercial Arbitration,
where the case on hand involves domestic arbitration. Further, it is a well
settled law that this Court cannot modify the interest portion of the
impugned Arbitral Award passed by an Arbitrator under Section 34 of the
Arbitration and Conciliation Act, 1996. Though the said issue is now subject
matter of consideration by the Constitution Bench of the Hon'ble Supreme
Court, but as on date, the law remains that modification of an Arbitral
Award is not permissible under law. Since the issue is answered against the
petitioner by this Court, this Court does not find any merit in this petition as
the impugned arbitral award has been passed in accordance with law.
Accordingly, this petition stands dismissed. No costs.
02.04.2025
vga
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Arb.O.P (Com.Div.) No.312 of 2023
ABDUL QUDDHOSE, J.
vga
Arb.O.P (Com.Div.) No.312 of 2023
02.04.2025
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