Arbitral Tribunal must apply established principles for interim measures, including prima facie case, balance of convenience, and irreparable harm, to justify orders compelling parties to secure claims.

JUDGMENT

Jyoti Singh, J. Present appeal has been filed by the Appellant under Section 37 (2) (b) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the `Act') challenging an interim order dated 11.09.2019 passed by the Sole Arbitrator, whereby the Arbitrator while declining to pass an Interim Award has passed an order in the nature of an interim measure directing the Appellant to furnish a Bank Guarantee for an amount of Rs.1,39,63,482/-.

2. Brief facts necessary for adjudication of the present appeal are that the Appellant which is a Public Limited Company had amalgamated with M/s TASEC Limited, the original Respondent before the Arbitrator. M/s TASEC Limited was a leading provider of Homeland Security Services to Corporates and Government and provided integrated solutions in Cyber, Physical and OT security areas in India. Respondent is an advisor for IT/telecom needs, including telephone systems, carrier services, voice/video/data networks, IP surveillance, internet services, etc. Appellant is the Respondent in the Arbitration Proceedings and is being referred to as Appellant hereinafter, while Respondent who is the Claimant before the Arbitrator is being referred to as Respondent hereinafter.

3. North Central Railway (NCR) floated a tender in 2013 for supply, installation, testing and commissioning of Integrated Security System consisting of video surveillance system, personal and baggage screening system and access control system at Allahabad junction, Kanpur Central, Agra Cantonment, Mathura Junction and Jhansi Junction stations. Erstwhile Respondent M/s TASEC submitted its bid on 31.03.2014 to the NCR to carry out work, under its earlier name M/s Avana Integrated Systems Limited and NCR accepted the Bid vide its Acceptance Letter dated 22.04.2014 and awarded the Contract.

4. Pursuant to the contract, the Appellant entered into a back to back arrangement with the Respondent herein. Appellant issued a Purchase Order dated 18.06.2014 to carry out work for an amount of Rs.11,17,00,000/-. As per Clause 3.2 of the General Terms and Conditions of the Purchase Order Respondent was obliged to complete the work and hand over the overall project on or before 22.09.2014.

5. Disputes arose between the parties on account of the Appellant making only partial payments to the Respondent. The matter was referred to a Sole Arbitrator in terms of the Arbitration Clause in the Contract. Respondent filed Statement of Claim before the Arbitrator and claimed that it had duly completed the work and had raised invoices for Rs.3,93,56,499/-, on the Appellant, while the Appellant claimed that Respondent had completed only part of the work and, therefore, it was liable to make only part payment. Appellant took the stand that Respondent had raised invoices towards supply, installation, testing and commissioning of certain products, but it had failed to perform the installation and commissioning, due to which Appellant had to engage third-party vendors for completing the balance work. Appellant, by way of Counterclaim, claimed Rs.3,33,02,101/- on account of additional amount incurred by it to complete significant portion of the work under the purchase order.

6. By an order dated 03.05.2019, the Arbitrator directed the Appellant to file a statement showing the payments allegedly due to the Respondent, in relation to the invoices raised by it. Appellant, in compliance with the order, filed a Statement of Account showing the details of the invoices raised by the Respondent and the payments made by the Appellant. The Statement reflected a difference in the amounts sought by the Respondent and the amount paid by the Appellant as "net balance". On the basis of the said Statement of Accounts, Respondent filed an application seeking payment of Rs.1,39,63,482/- shown as `net balance' as an Interim Award. Appellant filed its reply to the application.

7. Vide order dated 11.09.2019, learned Arbitrator rejected the prayer for