Contractual bar on interest governs arbitral awards, so no interest was payable on lien-retained sums after deposit in court.

Where a contract expressly bars interest on sums withheld or retained under lien after due notice, an arbitral tribunal cannot award interest contrary to that bargain. The Supreme Court held that the arbitrator and the High Court failed to give effect to the contractual clauses, and that Section 31(7) of the Arbitration and Conciliation Act, 1996 yields to the parties' agreement. Interest was therefore impermissible for the period from recovery until the amount was deposited in court, and no further interest was payable after deposit. The appellant's challenge succeeded.

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Issues: Whether, in view of the contractual clauses governing lien and retention, the arbitrator could award interest on the recovered amount and whether such interest was payable after the amount was deposited in court.

Analysis: The contract expressly provided that amounts withheld or retained under lien, once duly notified, would not carry any claim for interest or damages. The arbitrator and the High Court failed to give effect to these clauses. In the light of the contractual bar and the principle that an arbitral award of interest must conform to the parties' agreement, interest could not be granted for the period covered by the recovery and up to the date the amount was deposited in court. After deposit in court, no further interest was payable to the contractors.

Conclusion: The award of interest was impermissible to the extent it covered the period from recovery until deposit in court, and the challenge by the appellant succeeded.

Ratio Decidendi: Where the contract expressly bars interest on sums withheld or retained under lien, the arbitral tribunal cannot award interest contrary to that bargain, and Section 31(7) of the Arbitration and Conciliation Act, 1996 yields to the parties' agreement.

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