In Brief
A contractor in a telecom infrastructure project claimed post-award interest on an arbitral award after the arbitrator initially denied it, citing a contract clause prohibiting interest. While the District Court granted 18% post-award interest, the High Court set this aside, holding the contract forbade it. The Supreme Court allowed the appeal, holding that under Section 31(7)(b) of the Arbitration and Conciliation Act, 1996, post-award interest is a statutory right automatically due on arbitral awards and cannot be waived by contract. Only pre-award interest (under Section 31(7)(a)) is subject to party agreement. The Court distinguished the High Court's reliance on a prior judgment dealing with pendente-lite interest.
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