1. Arbitration — Section 31(7)(a) — Party Autonomy — Contractual Interest — Scope of Interference
Held, Section 31(7)(a) begins with “unless otherwise agreed by the parties” and this expression controls the entire clause. Where parties mutually stipulate an interest regime, the arbitral tribunal has no discretion to re-determine interest on reasonableness grounds. The contractual rate governs. (Paras 51-66, 140(iv), 140(vii))
2. Interest @ 36% p.a. with Monthly Rests — Commercial Bill Discounting — Not Unconscionable / Not Against Public Policy
Held, clause 4 of the sanction letters validly provides for (i) normal interest @ 36% p.a. with monthly rests, (ii) concessional rate @ 22.5% p.a. payable upfront, revocable upon default. Such stipulation in a high-risk bill-discounting finance contract between sophisticated corporates is enforceable and does not shock conscience. (Paras 46-50, 69-72, 140(ii), 140(vi)-(viii))
