1. Invoking the appellate jurisdiction of this Court under Section 37(1) of the Arbitration and Conciliation Act, 1996 (for the sake of brevity hereinafter called as 'the AC Act'), the appellant herein – Lanco Amarkantak Power Ltd. (LAPL), a company registered under the provisions of the Indian Companies Act, has preferred this arbitration appeal calling in question legality, validity and correctness or otherwise of the impugned order dated 11-3-2013 passed by the District Judge, Bilaspur granting application under Section 34 (2) of the AC Act in favour of the respondent herein – South Eastern Coalfields Limited (SECL), whereby the learned District Judge has set-aside the arbitral award passed by the arbitral tribunal by majority.

2. Essential facts shorn of all paraphernalia to judge the correctness of the order impugned are as under: -

(2.1) The appellant LAPL has established a thermal power plant (Unit 2) at Korba to the capacity of 300 MW and for this purpose, it has obtained necessary statutory clearances like forest and environmental clearance etc. and by memo dated 20-12-2014, Ministry of Coal, Government of India, directed the appellant to enter into fuel supply agreement (FSA) with the respondent (SECL) within one year from the said date. Accordingly, the appellant LANCO entered into FSA with the respondent SECL on 31-12-2015.

(2.2) The FSA, so signed by the parties, contained amongst other clauses, a clause under the head “Conditions Precedent” viz., clause 2.3 and other clauses in continuation thereof under the said terms of the FSA, the buyer (LAPL) was required to deposit an EMD / Commitment Advance (clause 2.6) and was also required to obtain financial closure within one year from the date of agreement i.e. the signature date of the agreement. It was further incumbent upon the appellant to inform within a period of seven days to the respondent SECL, the day on which he obtains financial closure (clause 2.4). It was made obligatory on the part of the respondent (SECL) to invoke bank guarantee against the earnest money / commitment advance in case the appellant fails to obtain financial closure within the period specified in the agreement {clause 2.6(D)}.

(2.3) It is the case of the appellant that he had already obtained financial closure as required under the agreement between 9-9-2005 and 20-9-2005 of which he had informed the respondent SECL on 4-2-2006, whereas the respondent SECL finding and holding that the appellant LAPL did not achieve financial closure in accordance with the terms of the FSA, invoked and encashed the bank guarantee furnished by the appellant LAPL after terminating the FSA on 29-2-2008 on the grounds stated therein.

(2.4) The dispute of termination of contract and consequent invocation of bank guarantee led to filing of writ petition titled as W.P.No.1514/2008 by the appellant before this Court. Considering the arbitration clause in the FSA, parties were directed to arbitrate the dispute, thereafter, parties appointed three Arbitrators (one presiding arbitrator and two other arbitrators) to resolve the arbitral dispute by constituting arbitral tribunal.

(2.5) The arbitral tribunal so constituted, after appreciating the oral and documentary evidence on record, by a majority (2 : 1), passed an award in favour of the appellant LAPL and against the respondent SECL to the effect that the purported termination and consequential invocation of bank guarantee was illegal and invalid, and directed the respondent SECL to return decretal amount along with interest.

(2.6) Feeling aggrieved and dissatisfied with the award, the respondent SECL questioned the award so passed by majority by filing an application under Section 34 (2) of the AC Act before the District Judge, Bilaspur. The learned District Judge by its impugned order granted that application and set aside the award by majority, leading t