In Brief
ONGC challenged an arbitral award of USD 6,56,272.34 and interest (12% per annum from 12.12.1998 onwards) made against it by a tribunal in a drilling services contract dispute. ONGC relied on clause 18.1 of the contract, which stated no interest was payable on delayed or disputed payments. The Supreme Court held that a clause merely barring interest on delayed payment does not bar the tribunal's statutory power to award pendente-lite interest (interest during arbitration proceedings). Only clauses that explicitly or by necessary implication bar pendente-lite interest—using comprehensive language like 'in any respect whatsoever'—would limit the tribunal's discretion. Since clause 18.1 did not expressly bar pendente-lite interest, the award stood valid. The appeal was dismissed.
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