Interest contractual pre-award & statutory post-award

Quantum of interest – contractual pre-award interest 14.75% as obtained in clause 32.6 of the concession agreement.   The post-award is 18% is the statutory interest and same was claimed in the counter claim of the petitioner.

When the parties have, in exercise of their party autonomy, laid down in the terms of the contract itself, the contractual rate of interest, we see no reason to go behind the agreement reached between them at a time when there was no dispute. Party autonomy is one of the most sacrosanct principles relating to arbitration law and in fact it is the backbone of alternative dispute resolution mechanism. This Court is only to uphold the bargain between the parties and their agreement in true sense and not go into the thicket of reasonability behind such bargain, unless the interest rate is so perverse and so unreasonable as to shock the conscience of this Court. There may be various reasons for the Appellant to have contractually accepted a higher rate of interest as the parties were seeking international finance and technology in executing the contract, we are not required to go into this question and attempt to perceive the reason behind such acceptance, but only to acknowledge that the contractual rate is set.

 judgment dated 29.5.2026 of the Supreme Court in Madhya Pradesh Road Development Corporation Ltd  Vs.  M/s Jabalpur Corridor Pvt Ltd in Civil Appeal No.10877 of 2018