S. Mukerkee, J.@mdashThe short point which arises for consideration in this case is whether the Judgment Debtor/DDA has satisfied the decretal amount which fell due under the decree.
2. The position, as has crystalised between the parties, and as relied upon by both the learned counsel, is contained in Annexure A to the reply filed by Delhi Development Authority to EA No. 338/2000.
3. It is admitted by Delhi Development Authority that the award amount Along with interest up to the date of award, was Rs. 5,22,002/62/-, which figure is also accepted by learned counsel for the Decree Holder.
4. Thereafter however while calculating the interest @ 12% for the period from 22.1.92 (the day after the date of Award), till 17.11.99 (which was the date of deposit of amount in this Court), the Delhi Development Authority went on to calculate the interest only on the awarded principal amount of Rs. 4,06,214.58/-, and not upon the total awarded amount inclusive of interest up to the date of Award (viz. not on Rs. 5,22,002.62).
5. Due to the above said difference in the base figure for computation of interest, an amount of Rs. 1,17,000.00/- is still outstanding as per the calculations of the Decree Holder, who has taken the base figure for calculation of pendente lite and future interest, to be, Rs. 5,22,002.62/- viz. the total amount up to the date of Award inclusive of interest as per award.
6. It is submitted by learned counsel for the Delhi Development Authority that there cannot be interest on interest, and as such their calculation (Delhi Development Authority''s calculation), is correct and the entire said amount having been paid, nothing further remains due towards the Decree Holder.
7. Section 3 of the Interest Act, 1978 stipulates that interest cannot be granted on interest. However, learned counsel for the Decree Holder while relying on the judgment of the Apex Court in Oil & Natural Gas Commission v. M.C. Clelland Engineers S.A. (1999) 4 CCC 327, has urged that interest becomes part of the principal amount, and Therefore on that awarded interest, further interest up to the date of payment, would accrue in terms of the above-said judgment of the Apex Court.
8. He has further relied upon the judgment of the Single Judge of the Punjab & Haryana High Court reported as Union of India v. Harbans Singh Tuli & Sons Builders (P) Ltd. AIR 2000 P&h 313 where he submits that it has been categorically held that the Union of India was liable to pay interest even on the pendente lite interest.
9. In my view there is a fallacy in the submission of learned counsel for the Decree Holder.
10. It is a settled position under law that interest is awarded in the nature of damages for delayed payment, and there can-not be an award of further damages on damages. For this purpose, it would be necessary to examine carefully the decision of the Apex Court in Oil & Natural Gas Commission (supra). The arbitrators in that case, while dealing with the claims before them, had awarded interest as a claim, and thereafter had also awarded interest @ 12% from the date of the award till realisation. The submission of learned senior counsel for Oil & Natural Gas Commission was that since the claims themselves were having interest component, Therefore the arbitrators could not have awarded further interest on those claims.
11. The Apex Court held that if any interest for the delay in making, say invoice payments, is dealt with as a claim and is awarded as part of a claim, thereafter there can also be an award of interest on awarded claim up to the date of the payment, since that is the interest as compensation for the delay in the payment of the awarded amount. Therefore interest can always be granted in relation to the total amount awarded under the total number of claims, including any claim which themselves are including determination of invoice price with interest.
12. However that does not mean that once the cumulative amount awarded under the different heads of claim, are added together to constitute the principal awarded amount, thereafter it will become a continuously increasing base figure for working out the further interest awarded after the award, and also after the decree.
13. Learned counsel for the Decree Holder submits that while calculating the further interest from the date of the decree, with interest up to date of decree, whatever is the cumulative amount up to the date of the decree with interest up to date of decree, should be taken as the base figure. This is totally unsustainable. Once the principal amount awarded is known, in relation to compensation for the time taken for the said payment to reach the decree holder, the only entitlement can be to interest at the rate granted by the Court, but always with the base figure remaining as the cumulative amount of the award, and not the amount inclusive of interest as on the date of the decree.
