- (1.) While issuing notice on 04.07.2006, this Court directed as under: "Delay condoned. Issue notice limited on the question of interest. Meanwhile, execution of the award is stayed."
(2.) A perusal of the above order reveals, that the adjudication in the instant appeal would be limited to the interest payable, on the amount determined by the arbitrator. The award of the arbitrator dated 17.07.1999 held as under: "I have carefully examined and gone through all the documents produced. I am satisfied that the petitioner's claim is true and correct and is substantiated by oral and documentary evidence. Hence, I hold on point no.1 that the petitioner has proved the claim put forth as above and hence the amount claimed is correct and due and the arbitrator is validly appointed and an award has to be passed in favour of the petitioner as follows and in the result I pass the following award: (A) That the respondents jointly and severally shall pay to the petitioner Rs.99,463/- as claimed by the petitioner with future interest at 36% per annum from 9.2.1999 till payment. (B) That the respondents jointly and severally shall pay to the petitioner Rs.1,596/- towards the costs of the arbitration. The total value of the reliefs granted under this award is Rs.1,01,059/- and as such it is engrossed on N.J. Stamp paper of the value of Rs.285/- as per Section 11 of the Karnataka Stamp Act as amended." A perusal of the determination rendered by the arbitrator reveals, that interest at the rate of 36 per cent per annum, would be payable from the date of default, namely, from 9.2.1999, till the liability stood discharged.
(3.) When the afore-stated award came to be assailed before the District Judge, Udupi, under Section 34 of the Arbitration and Conciliation Act, 1996, the District Judge, Udupi, reduced the amount as well as the interest payable. The operative portion of the order of the District Judge, Udupi, dated 18.12.2002 is being extracted hereunder: "Petitioner and Vasudeva Gowda and K. Dasappa Gowda shall pay in a sum of Rs.48,000/- jointly and severally with interest at 15% p.a. thereon from 9.2.99 till the date of passing of award by the Arbitrator and thereafter at the rate of 18% p.a. thereon till realization together with the costs of Arbitration Proceedings of Rs.1,596/-." It is apparent from the above, that while the principal amount came to be reduced to Rs.48,000/- (from Rs.1,01,059/-), the rate of interest came to be reduced to 15% per annum (from 36% per annum). ;