SUDHIR NARAIN, J. - (1.) THIS appeal is directed against the order dated 14 -7 -1998 passed by the Civil Judge (Senior Division), Bijnor whereby he allowed the objections filed by the State of U.P. and set aside the award dated 14 -9 -1996.
(2.) THE factual matrix of the case is that the appellant entered into a contract for construction of 2.70 meter fall on Chandak Escape Channel at 0.475 Km. in district Bijnor with the Executive Engineer, Irrigation Division, Bijnor. After completion of the work, he claimed the amount of constructions made by him from respondent No. 1. The amount as claimed by him was not paid. He gave notice to the respondents on 15 -11 -1992 to pay the amount. The matter was finally referred to the Arbitrator and the arbitral proceedings commenced on 14 -2 -1994. The Arbitrator after giving opportunity to the parties to lead evidence gave award dated 14 -9 -1996 directing the respondents to pay a sum of Rs. 4,96,173/ - to the appellant. The appellant filed an application under Section 14 read with Section 17 of the Arbitration Act, 1940 for making the award rule of the Court. It was registered as Misc. Case No. 178 of 1996. The respondents filed an application to set aside the award under Section 30 of the Arbitration Act, 1940, which was registered as Misc. Case No. 181 of 1996. The Court below rejected all the objections raised on behalf of the respondents except one objection, i.e., the Arbitrator had no jurisdiction to give award for the period prior to the date of making reference. The application of the appellant to make award was rejected solely on the ground that the Arbitrator had no jurisdiction to give award for pre - reference period. The core question is as to for which period an Arbitrator is entitled to award interest on the amount adjudged payable to the claimants. The claim for interest before the Arbitrator may be divided in three periods : (I) The period prior to the date of making reference. (II) The period the matter remained pending before the Arbitrator. (III) The period from the date of award to the date of decree or date of realization which ever is earlier. I. The period prior to the date of making reference.
(3.) THE period prior to the date of making reference can be termed as pre -reference period. The question as to whether an Arbitrator has power to award interest for the period between the making of the reference to him and on his entering upon the reference (pre - reference period) came up for consideration before the apex Court in Executive Engineer (Irrigation)v. Abhaduta Jena, AIR 1988 SC 1520, wherein it was held : Out of the remaining cases, we find that in all cases except two (Civil Appeals Nos. 6019 -22 of 1983 and Civil Appeal No. 2257 of 1984), the reference to arbitration were made prior to the commencement of the new Act which was on 19 -8 -1981. In the cases to which the Interest Act, 1978 applies, it was argued by Dr. Chitale, learned Counsel for the respondents, that the amount claimed was a sum certain payable at a certain time by virtue of a written instrument and, therefore, interest was payable under the Interest Act for the period before the commencement of the proceedings. In support of his contention that the amount claimed was a sum certain payable at a certain time by virtue of a written instrument, the learned Counsel relied upon the decision of this Court, in State of Rajasthanv. Raghubir Singh. The case certainly supports him and in the cases of which the 1978 Interest Act applies, the award of the interest prior to the proceeding is not open to question. ;