- (1.) In this batch of civil appeals the principal question that arises for consideration is as to whether the Arbitrator has got jurisdiction to award interest for the pre-reference period in cases which arose prior to commencement of the Interest Act, 1978. The Interest Act, 1978 came into force w.e.f. 19.8.1981. Before enforcement of this, the Interest Act, 1839 was holding the field. Under the impugned judgment, the High Court has awarded interest for the pre-reference period and this is how the State of Orissa has filed all these appeals.
(2.) Mr. Raj Kumar Mehta, learned Advocate appearing in support of these appeals urged that the question of payment of interest for the pre-reference period is no more resin integral as the said question has been answered in the negative by this Court in catena of judgments. However, Mr. Anil Diwan, the learned Senior Counsel appearing for the respondents, urged that in view of judgment of this Court in State of Orissa v. G.C. Roy,1991 3 SCR 417, the judgment in Executive Engineer (Irrigation) Balimela and Ors. v. Abhaduta Jena and Ors., 1988 1 SCR 253, and State of Orissa v. B.N. Agarwalla, 1997 1 SCR 704, require reconsideration. Some English decisions as well as decisions of this Court were also relied upon.
(3.) Mr. Mehta drew our attention to various judgment of this Court including the Privy Council to support his submission. A strong reliance has been placed by him on two decisions rendered by the three-Judge Bench, (1) Executive Engineer (Irrigation) Balimela and Ors. v. Abhaduta Jena and Ors., 1988 1 SCR 253, (2) State of Orissa v. G.C. Roy,1991 3 SCR 417 and State of Orissa v. B.N. Agarwalla, 1997 1 SCR 704. He also drew our attention to the following decisions and urged that cases governed by the Interest Act, 1839 the arbitrator has no jurisdiction to award pre-reference interest in the absence of any custom or usage of trade having the force of law or any other provision of substantive law entitling the claimant to recover interest. 1. Bengal Nagpur Railway Co. 65 1A 66. 2. Seth Thawardas Pherumal v. UOI, 1955 2 SCR 48. 3. UOI v. A.L. Rallia Ram, 1964 3 SCR 164. 4. UOI v. Watkins Mayor & Co., 1966 AIR(SC) 275. 5. UOI v. West Punjab Factories Ltd., 1966 1 SCR 580.;