Arbitration award interest cannot be modified by court under the 1996 Act; limited review permits only statutory setting aside grounds.

In arbitration governed by the Arbitration and Conciliation Act, 1996, the tribunal's power to award post-award interest under Section 31(7)(b) operates unless the award provides otherwise, and the court cannot revise that rate merely because a lower rate appears more appropriate. The court's jurisdiction under Sections 34 and 37 is limited to the statutory grounds for setting aside an award and does not extend to modifying the interest component. The High Court's reduction of compound interest to simple interest was therefore unwarranted, and the arbitral award was restored on the question of interest.

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Issues: Whether the High Court could reduce the rate of interest awarded by the arbitrator from 18% compound interest to 9% simple interest in proceedings governed by the Arbitration and Conciliation Act, 1996.

Analysis: The arbitration commenced after the 1996 Act came into force, so the award was governed by Section 31(7)(b) of that Act. That provision contemplates interest on the awarded sum at 18% per annum unless the award directs otherwise. The Court held that, unlike under the repealed 1940 Act, the 1996 Act does not confer power on courts to modify an award; the court's jurisdiction under Sections 34 and 37 is confined to setting aside an award on established statutory grounds and does not extend to revising the rate of interest merely because a different rate appears more reasonable. The precedents relied on by the respondent were distinguished on their facts and on the basis of Article 142 intervention.

Conclusion: The High Court was not justified in reducing the interest rate, and the arbitral award granting 18% interest was restored.

Final Conclusion: The appeal succeeded to the extent that the modification of interest made by the High Court was set aside, and the arbitral award was reinstated on the question of interest.

Ratio Decidendi: In proceedings governed by the Arbitration and Conciliation Act, 1996, a court cannot modify the rate of interest awarded by an arbitral tribunal and may interfere only within the limited grounds for setting aside an award.

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