Scope of Court Interference, Severability of Awards, and Contractual Bars on Pendente Lite Interest under Arbitration Law

sketch of the Bombay High Court
Case
THE KOLHAPUR MUNICIPAL CORPORATION v. FAIRDEAL CONSTRUCTION (Bombay High Court, 08-10-2026)
Law
Arbitration and Conciliation Act, Indian Contract Act, Interest Act.

Highlights of the Judgment:

  • Examination of the scope of judicial interference under Section 34 of the Arbitration and Conciliation Act, 1996, concerning factual findings and expert reports.
  • Interpretation of Section 31(7)(a) regarding the enforceability of explicit contractual clauses barring pendente lite interest.
  • Application of the doctrine of severability under Section 34 to isolate and set aside invalid interest components of an arbitral award.
  • Modification of post-award interest under Section 31(7)(b) in light of the 2016 statutory amendment and judicial precedents.
  • Assessment of costs under Section 31A of the Act based on party conduct and procedural history.