The central legal point established in the judgment is the significance of the Discharge Voucher and its execution under duress or free will, as well as the relevance of the IRDA circulars in determining the rights of the policyholder.

NAVIN CHAWLA, J.

1. This petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘Act’) has been filed by the petitioner challenging the Arbitral Award dated 03.06.2017 passed by the Sole Arbitrator adjudicating the disputes that have arisen between the parties in relation to the “Standard Fire and Special Perils” Insurance Policy bearing Policy No. 040801/11/13/11/00000259, taken by the petitioner from the respondent for a sum of Rs.98.50 crores for the period 26.03.2014 to 25.03.2015.

2. On the night of 21.04.2014 a fire had broken out in the Milk Powder Godown of the petitioner’s factory due to an electric short circuit. The respondent appointed M/s Soni & Company as surveyor to assess the loss on 22.04.2014. The proceedings before the surveyor are not relevant for the present adjudication. What is relevant for the present adjudication is that on 17.03.2015 the petitioner addressed the following communication to the respondent:

“Dear Sir,

PL.refer our above mentioned fire claim.

We are confirming the full and final fire claim amount of Rs.9,77,28,656/- (Rs.Nine crores Seventy Seven Lacs Twenty Eight Thousands Six Hundreds Fifty Six) Only.

Your fast co-operation is needed in regards.”

3. The above document is sought to be relied upon by the respondent as a full and final discharge of the contract of insurance. On the other hand, it is the case of the petitioner that this document was given by the petitioner under duress and coercion, as without this document the respondent was not willing to release the claim amount in favour of the petitioner.

4. Even after the receipt of the above letter, the respondent had not released the said amount of Rs.9,77,28,656/- in favour of the petitioner, forcing the petitioner to address emails dated 30.04.2015 and 11.06.2015. In both of these emails, the petitioner asserted that it was facing acute financial crises due to delay in settlement of the claim amount by the respondent.

5. The respondent by its letter dated 18.06.2015 informed the petitioner that the competent authority of the respondent had approved the claim of the petitioner for a sum of Rs. 8,80,35,058/- and after deducting the re-instatement premium, the net amount payable to the petitioner was Rs.8,79,44,848/-. The respondent further called upon the petitioner to sign the Discharge Voucher for release of the said amount. The relevant quotation from the said letter is as under:

“You are, therefore requested to please send us the disbursement voucher duly Discharge/signed affixing revenue stamp with company seal and submit the No Objection Certificate from your all banks whoe’s interest is the in the policy.(PNB, OBC, ANDHRA BANK, BOI & CORP.BANK)

Since the payment of claim will be initiated in any one bank account you may also submit the No Objection Certificate from all banks that they do not have any objection to release the claim amount in any one bank account and put up your request to us to which bank account the payment will be initiated finally.”

6. The petitioner duly executed the disbursement claims voucher dated 18.06.2015. What is relevant in this Discharge Voucher is that it states that the petitioner has received an amount of Rs.8,80,35,058/- from the respondent. Admittedly, Rs.8,79,44,848/- was paid by the respondent to the petitioner only on 26.06.2015, that is, after the execution of this Disbursement Voucher. It is also evident from the contents of the letter dated 18.06.2015 of the respondent that the respondent would not have released the above payment without the petitioner having executed the Disbursement Voucher.

7. The petitioner by its email dated 03.07.2015 called upon the respondent to supply the copy of the surveyor report and also provide the reasons for the deductions made. The surveyor report was supplied by the respondent to the petitioner on 13.07.2015. Learned senior counsel for the petitioner submits that the surveyor report was supplied without the