Vipul Ganda is an Independent Litigation Counsel with over 14 years of experience and a proven track record in Litigation and Dispute Resolution.
Shenzhen Shandong Nuclear Power Construction Company Limited Versus Vedanta Limited
Court / Forum :
Delhi High Court Citation : OMP (ENF.) (COMM.) 225/2018; MANU/DE/0106/2020 Coram : Justice J.R. Midha Subject : Section 36 of the Arbitration and Conciliation Act, 1996 Date of Decision : January 06, 2020
The Arbitral Tribunal (“Tribunal”) awarded the following to the claimant:
Claim I - Rs. 46,71,41,942, Euro 23,717,437 and Rs. 12,19,69,047.
Claim II - Rs. 25,47,325, Rs. 6,06,707 and Rs. 1,31,10,990.
An interest of 9% was also payable from the date of institution of arbitration proceedings, provided the amount is paid within 120 days of award. If the amount is not paid within 120 days, then further interest of 15% shall also be payable till the realization of amount. The amount payable in Euro would be payable as per the value of exchange rate on the date of filing of claim petition.
The Tribunal also awarded Rs. 50,00,000 towards costs and legal expenses.
Against the award, the judgment debtor filed its objections and thereafter, the judgment debtor appealed before the division bench, but they were dismissed. Subsequently, the judgment debtor approached Hon’ble Supreme Court under Special Leave Petition and the Hon’ble Supreme Court modified the interest rate. For Euro component of the award, the award debtor would be liable to pay interest at LIBOR rate + 3 percentage points, prevailing on the date of award till the date of realization. Also, interest at a uniform rate of 9% shall be payable on Indian currency component till the date of realization and 15% interest rate post 120 days stands deleted
What should be the order of appropriation of the decretal amount?
The Hon’ble Delhi High Court held that general rule of appropriation of decretal amount is that the amount has to be first adjusted towards interest and cost and thereafter towards the principal amount.