LexJAIPRAKASH ASSOCIATES LTD. (JAL) THROUGH ITS DIRECTOR versus TEHRI HYDRO DEVELOPMENT CORPORATION INDIA LTD.
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JAIPRAKASH ASSOCIATES LTD. (JAL)
THROUGH ITS DIRECTOR
v.
TEHRI HYDRO DEVELOPMENT CORPORATION INDIA LTD.
(THDC) THROUGH ITS DIRECTOR
(Civil Appeal No. 1539 of 2019)
FEBRUARY 07, 2019
[A. K. SIKRI, S. ABDUL NAZEER AND M. R. SHAH, JJ.]
Arbitration and Conciliation Act, 1996:
s. 31(7)(a) – Power of arbitrator to award pendente-lite interest
– Arbitral Tribunal while allowing the claims, also granted pendente-
lite interest – Objection to award of interest in view of clauses 50
and 51 of General Conditions of Contract which barred grant of
interest – Single Judge of High Court quashed the award limited
to the interest – Order of Single Judge affirmed by Division Bench
of High Court – On appeal, held: As the clauses 50 and 51 of
General Conditions of Contract put a bar on arbitral Tribunal to
award interest, arbitral Tribunal did not have jurisdiction to do so.
Doctrines/Principles:
Principle of ejusdem generis – Applicability of – Discussed –
The principle is not applicable in the present case – Interpretation
of Statutes – Rules of Interpretation.
Dismissing the appeal, the Court
HELD: 1.1 Right from the stage of arbitration proceedings
till the High Court, clauses 50 and 51 of General Conditions of
Contract (GCC) are interpreted to hold that they put bar on the
arbitral tribunal to award interest. Even the majority award of
the arbitral tribunal recognised this. Notwithstanding the same,
it awarded the interest by relying upon *Board of Trustees for the
Port of Calcutta case. In case clauses 50 and 51 of GCC put a bar
on the arbitral tribunal to award interest, the arbitral tribunal did
not have any jurisdiction to do so. The High Court, both Single
Bench as well as Division Bench, rightly noted that the aforesaid
judgment was under the 1940 Act and the legal position in this
[2019] 2 S.C.R. 41
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SUPREME COURT REPORTS [2019] 2 S.C.R.
behalf have taken a paradigm shift which position is clarified in
**Sayeed Ahmed and Company case. This rationale given by the
High Court is in tune with the legal position which stands
crystallised by catena of judgments. [Para 16][55-C-E]
1.2 The judgment in #Harish Chandra case is under the
1940 Act. This judgment is explained and distinguished in
**Sayeed Ahmed and Company case. The judgment in Sayeed
Ahmed and Company distinguishing the restrictive wording in
#Harish Chandra case has been consistently followed by this Court
in number of cases thereafter. In this scenario, when it is found
that #Harish Chandra case which is of the vintage of 1940 Act
and is distinguished in **Sayeed Ahmed and Company case
coupled with the fact that the ratio of **Sayeed Ahmed and
Company case has been consistently followed, there is no reason
to deviate from the construction to Clauses 50 and 51 of the GCC
given by the arbitral tribunal in the first instance as well as the
High Court. [Paras 19 and 20][56-C-D, 57-H, 58-A-B]
Secretary, Irrigation Department, Government of Orissa
& Ors. v. G.C. Roy (1992) 1 SCC 508: [1991] 3 Suppl.
SCR 417 – followed.
Tehri Hydro Development Corporation (THDC) Limited
& Anr. v. Jai Prakash
Associates Limited (2012) 12
SCC 10 : [2012] 8 SCR 813 ; **Sayeed Ahmed and
Company v. State of Uttar Pradesh & Ors. (2009) 12
SCC 26 : [2009] 10 SCR 841 ; Sree Kamatchi Amman
Constructions v. Divisional Railway Manager (Works),
Palghat & Ors. (2010) 8 SCC 767 : [ 2010] 10 SCR
487 ; Union of India v. Bright Power Projects (India)
Private Limited (2015) 9 SCC 695: [2015] 6 SCR
488 ; Sri Chittaranjan Maity v. Union of India (2017)
9 SCC 611 : [2017] 11 SCR 722; Reliance Cellulose
Products Limited v. Oil and Natural Gas Corporation
Limited (2018) 9 SCC 266 : [2018] 6 SCR 618 – relied
on.
*Board of Trustees for the Port of Calcutta v. Engineers
De-Space-Age (1996) 1 SCC 516 : [1995] 6 Suppl.
SCR 327 – distinguished.
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#State of Uttar Pradesh v. Harish Chandra and Company
(1999) 1 SCC 63 : [1998] 2 Suppl. SCR 660 – stood
distinguished.
2. The principle of ejusdem generis is not applicable in the
present case. The rule of ejusdem generis would be applied only
if there is distinct genus or a category, which is lacking in the
instant case. This rule is applicable when particular words
pertaining to a clause, category or genus are followed by general
words. In such a situation, the general words are construed as
limited to things of same kind as those specified. In that sense,
this rule refExcerpt shown. Read the full judgment & AI analysis in Lexace.