Section 31 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 31 says what an award must look like: in writing, signed, reasoned, dated, stating the place of arbitration and delivered to each party. It also deals with interim awards, with interest before and after the award, and with costs.
An arbitral award shall be in writing and signed by the members of the tribunal; with more than one arbitrator, the signatures of the majority suffice if the reason for any omitted signature is stated. It states reasons unless the parties agreed that none be given or it is an award on agreed terms under section 30. It states its date and the place of arbitration and is deemed made there. A signed copy goes to each party. For money awards, the tribunal may include interest at a reasonable rate for the pre-award period, and, unless the award otherwise directs, a sum awarded carries interest at two per cent. higher than the current rate of interest from the date of the award to payment. This is as per the India Code consolidated text consulted.
Why section 31 matters
An award that does not meet section 31 invites a challenge. A drafter, a party and a CA advising on provisions for a payable award all need to know what the award must contain and how interest runs. The section follows the settlement section; see section 30. What happens after it is made is in sections 32 to 36; see sections 32, 33 and 35. For the full journey from award to enforcement, see our note on arbitral award making and enforcement.
In the India Code consolidated text, section 31 stands in Chapter VI of Part I, "Making of arbitral award and termination of proceedings". The footnotes show clause (b) of sub-section (7) and sub-section (8) as substituted by Act 3 of 2016, s. 16, with effect from 23-10-2015. If you hold or expect an award, arbitration support can help you check it against this list.
Sub-sections (1) and (2): writing and signatures
- (1) An arbitral award "shall be made in writing and shall be signed by the members of the arbitral tribunal."
- (2) In proceedings with more than one arbitrator, "the signatures of the majority of all the members of the arbitral tribunal shall be sufficient so long as the reason for any omitted signature is stated."
So if one of three arbitrators does not sign, two signatures suffice, but the award must state why the third is missing. This works together with section 29(1), under which a panel decides by a majority of all its members; see sections 28 and 29.
Sub-section (3): reasons
The award "shall state the reasons upon which it is based, unless":
- (a) the parties have agreed that no reasons are to be given, or
- (b) the award is an arbitral award on agreed terms under section 30.
A party that wants a short award without reasons has to agree to that. Without such agreement, reasons are needed.
Sub-section (4): date and place
"The arbitral award shall state its date and the place of arbitration as determined in accordance with section 20 and the award shall be deemed to have been made at that place." See sections 20 and 22. The date matters because several periods are counted from the date of the award, including the interest period in sub-section (7)(b).
Sub-section (5): delivery
"After the arbitral award is made, a signed copy shall be delivered to each party." Keep the proof of delivery, since later periods may depend on receipt.
Sub-section (6): interim awards
"The arbitral tribunal may, at any time during the arbitral proceedings, make an interim arbitral award on any matter with respect to which it may make a final arbitral award." Section 2(1)(c) says "arbitral award" includes an interim award; see section 2. A tribunal may therefore decide a distinct point, such as liability, before the rest.
Sub-section (7): interest
(a) Interest for the period before the award
"Unless otherwise agreed by the parties, where and in so far as an arbitral award is for the payment of money, the arbitral tribunal may include in the sum for which the award is made interest, at such rate as it deems reasonable, on the whole or any part of the money, for the whole or any part of the period between the date on which the cause of action arose and the date on which the award is made."
Points: the parties may agree otherwise; it applies to a money award; the rate is what the tribunal deems reasonable; and it can cover the whole or part of the money and of the period from the cause of action to the award.
(b) Interest after the award
"A sum directed to be paid by an arbitral award shall, unless the award otherwise directs, carry interest at the rate of two per cent. higher than the current rate of interest prevalent on the date of award, from the date of award to the date of payment."
Explanation. "The expression 'current rate of interest' shall have the same meaning as assigned to it under clause (b) of section 2 of the Interest Act, 1978 (14 of 1978)."
On the history, the footnote says only that clause (b) was substituted "for clause (b)" by Act 3 of 2016, s. 16, with effect from 23-10-2015; the earlier clause is not reproduced, so no comparison is made here. The present clause does not state a fixed percentage. It gives a rate that is two per cent. higher than the "current rate of interest" prevalent on the date of award. The text consulted gives no figure for the "current rate of interest"; it points to the Interest Act, 1978, and we state no rate.
| Interest | Period | Rate | Can the award change it? |
|---|---|---|---|
| (7)(a) | Cause of action to date of award | Such rate as the tribunal deems reasonable | Parties may agree otherwise |
| (7)(b) | Date of award to date of payment | Two per cent. higher than the current rate of interest prevalent on the date of award | Yes, "unless the award otherwise directs" |
For the tax treatment of interest received or paid, see our income-tax guides; no tax rules are given here.
Sub-section (8): costs
As substituted in 2015: "The costs of an arbitration shall be fixed by the arbitral tribunal in accordance with section 31A." The footnote shows the substitution as made by Act 3 of 2016, s. 16, with effect from 23-10-2015, and does not reproduce the earlier sub-section. Section 31A is explained in our article on costs.
One point in the official text is unclear and is quoted as printed. After the bracket that closes sub-section (8), the text prints an Explanation: "For the purpose of clause (a), 'costs' means reasonable costs relating to" (i) the fees and expenses of the arbitrators and witnesses, (ii) legal fees and expenses, (iii) any administration fees of the institution supervising the arbitration, and (iv) any other expenses incurred in connection with the arbitral proceedings and the arbitral award. Sub-section (8) as printed has no clause (a), and the text does not say which clause is meant, so we do not resolve it. Section 31A(1) carries its own Explanation of "costs", in similar words with Courts and Court proceedings added. Deposits towards the costs referred to in section 31(8) are dealt with in section 38; see sections 38 and 39.
A checklist for an award
| Item | Section |
|---|---|
| In writing | 31(1) |
| Signed by the members (majority suffices if reason for omission stated) | 31(1), (2) |
| Reasons stated (unless agreed otherwise or on agreed terms) | 31(3) |
| Date and place of arbitration stated | 31(4) |
| Signed copy delivered to each party | 31(5) |
| Interest and costs addressed | 31(7), (8) |
A worked example
Mehta Exports wins an award against Bhat Imports for an unpaid invoice. The award, signed by all three arbitrators, states its reasons, its date and the place of arbitration. It includes interest on the invoice sum from the date the cause of action arose to the date of the award at a rate the tribunal considers reasonable, and it is silent on later interest. Under sub-section (7)(b), the awarded sum carries interest from the date of the award to payment at two per cent. higher than the current rate of interest on the date of award. Costs are fixed in line with section 31A. A signed copy is delivered to both sides.
Practical steps
- Check the award against the list above on the day it arrives.
- Note the date of delivery of the signed copy.
- If the award is silent on post-award interest, remember sub-section (7)(b) supplies it unless the award directs otherwise.
- If the award contains a slip or omits a claim, see section 33 on correction; see sections 32, 33 and 35.
- For recourse against an award, see our post on section 34.
Need help with an award or interest calculation?
An award is only useful if it is complete and enforceable. Our arbitration support team can review the award against section 31, check the interest wording and plan the next step, whether correction, challenge or enforcement.
Key takeaways
- An award is in writing and signed; the majority's signatures suffice if the reason for any omitted signature is stated.
- Reasons are required unless the parties agreed otherwise or it is a consent award under section 30.
- The award states its date and the place of arbitration and is deemed made there; a signed copy goes to each party.
- Pre-award interest is at a rate the tribunal deems reasonable; post-award interest is, unless the award directs otherwise, two per cent. higher than the current rate of interest on the date of award.
- Costs are fixed in accordance with section 31A.
Read next
- Section 31A: regime for costs
- Sections 32, 33 and 35: termination, correction and finality
- Section 36: enforcement of the award and stay
- Arbitral award making and enforcement
Disclaimer: Based on the India Code consolidated text of the Arbitration and Conciliation Act, 1996, whose footnotes show amendments up to Act 3 of 2021 and a latest date of 12 October 2023, as consulted on 2 October 2026. Rules, regulations and notifications under the Act, later amendments and the commencement of the Mediation Act, 2023 should be checked. This article is general information, not legal advice; check the official text before acting.