In Brief
A contractor and municipal corporation went to arbitration over contract disputes. An Arbitrator awarded Rs. 66.56 lakhs plus interest. The High Court Division Bench challenged parts of the award, reducing several claims and scaling back interest rates. The Supreme Court held the Division Bench exceeded its jurisdiction by substituting its own findings for the Arbitrator's reasoned decision. Courts cannot reinterpret arbitration awards unless they are perverse or illegal. The Court upheld most claims (for wrongful omission, overheads, and price escalation) as separate and justified, but agreed to reduce interest rates from 18%/12% to a uniform 12% in light of dropping interest rates. The appeal was allowed and the Division Bench judgment set aside."
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