The issuance of a No Claim Certificate under coercion does not negate a party's claims, and contractual requirements for communication in risk transfer are mandatory.

JUDGMENT

Vibhu Bakhru, J. GAIL (India) Limited (hereinafter `GAIL') has filed the present petition impugning an arbitral award dated 10.12.2020 (hereinafter `the impugned award') rendered by an Arbitral Tribunal constituted by Justice (Retd.) Badar Durrez Ahmed as the Sole Arbitrator. The said award was rendered in respect of disputes that had arisen between the parties in connection with the contract for `Civil and Structural and U/G Piping Works for LLDPE/HDPE' at GAIL's Petrochemical Complex-II at Pata, Uttar Pradesh (hereinafter `the Project').

2. GAIL had appointed Engineers India Limited (EIL) as the consultant for implementation of the Project. EIL invited bids for the Project on behalf of GAIL and the respondent had submitted its bid pursuant to the said invitation. The respondent's bid for a contract value of Rs.63,68,27,876/- was accepted and the same was communicated to the respondent by a Fax of Acceptance (FAO) on 08.10.2011. Subsequently, on 03.11.2011, a detailed letter of acceptance (DLOA) was issued to the respondent. The works were required to be completed within a period of eighteen months with effect from the date of issuance of the FOA; that is, by 08.04.2013. The time for completing the works was extended and the respondent finally completed the same on 31.03.2015. Thereafter, on 03.03.2016, the respondent submitted its Final Bill to EIL. The Final Bill was forwarded by EIL to GAIL and payments against the same were made on the recommendations of EIL. The last payment was made to the respondent on 17.10.2017.

3. Prior to receipt of the last payment, the respondent invoked the Arbitration Clause and issued a notice dated 12.10.2017. GAIL did not take any steps for either resolving the disputes or constituting the Arbitral Tribunal pursuant to the aforesaid notice, as according to it, there were no disputes between the parties. According to GAIL, the contract stood discharged by accord and satisfaction in view of the No Claim Certificate (hereinafter `the NCC') issued by the respondent.

4. Since GAIL did not act on the aforementioned notice for arbitration, the respondent filed a petition under Section 11(6) of the A&C Act seeking appointment of an Arbitrator. This Court allowed the said petition and by an order dated 16.04.2018, appointed the Sole Arbitrator to adjudicate the disputes between the parties.

5. The respondent filed its Statement of Claims before the Arbitral Tribunal, inter alia, raising several claims. The same are briefly described below:

5.1. Claim No. 1: a sum of Rs.27,90,574/-including service tax of Rs.69,762/- plus interest at the rate of 19.75% per annum. An amount equivalent to 0.5% of the Running Account (RA) bills submitted by the respondent had been deducted towards water charges. The respondent claimed the said amount on account of sums deducted by GAIL as deduction on account of water charges. The respondent claimed that GAIL had failed to comply with its obligations to supply water to the respondent for seven months from the beginning of the contract. And, since it was not supplied any water for construction, the respondent had to make its own arrangements for timely completion of the project. Thus, the amounts deducted from its RA bills on account of water charges were liable to be refunded with interest.

5.2. Claim No. 2: the respondent claimed reimbursement for structural steel and allied