JUDGMENT :

S.MANU, J.

The petitioner is a Private Limited Company. It runs a factory in Pala and a depot in Alleppey. It had entered into two policies with the respondent company:- (1) National Bharat Sookshma Udyam Suraksha Policy No.60210012310000111 with respect to stocks, having validity from 27.07.2023 to midnight of 26.07.2024 under occupancy details as “mattress and pillow making”, for the factory, with total location sum insured of Rs.2,94,20,248/- and (2) National Bharat Laghu Udyam Suraksha Policy No.602100112310000112 for the assets in the factory, with the policy effective from 27.07.2023 to midnight of 26.07.2024, again under the occupancy details of “mattress and pillow making”, for total location sum insured of Rs.17,02,96,781/-. Copies of the policy have been produced as Annexures 1 and 2.

2. An accidental fire broke out in the petitioner’s factory at Pala on 12.11.2023, leading to extensive damage to various stocks of finished goods, semi-finished goods, raw materials etc. besides the building, plant, machinery, office equipments and other assets including a lorry. The petitioner reported the accident to the respondent and laid a claim. A Surveyor was appointed by the respondent who filed a report on 17.07.2025. A copy of the report has been produced as Annexure 4. The respondent offered a full and final settlement of the claim for stocks and assets for an amount of Rs.2,92,45,468/- as against the Surveyor’s assessment of net loss at Rs.3,89,93,958/-. An amount of Rs.52,36,061/- was deducted as 25% non-standard deduction in the final amount determined by the respondent and an amount of Rs.45,12,429/- was deducted as 25% non-standard deduction on Surveyor’s assessed claim amount with respect to Annexure 2 policy. The petitioner accepted the amount offered by the respondent and a claim discharge voucher was executed on 12.03.2025. Later, the petitioner disputed the deductions and demanded that the respondent shall pay the amounts deducted. However, the respondent did not accede to the said claim.

3. Invoking the arbitration clause in the policies Annexure 5 letter was issued by the petitioner to the respondent on 15.09.2025. Annexure 6 reply was issued by the respondent on 07.11.2025, denying the claims of the petitioner. Thereafter, Annexure 7 notice dated 23.12.2025, was issued by the petitioner as contemplated under Section 21 of the Arbitration and Conciliation Act, 1996 for initiating arbitrary proceedings. The said notice was received by the respondent on 26.12.2025. An e-mail communication was issued by the respondent on 20.01.2026 in reply reiterating the stand taken in the earlier reply notice. As there is no consensus regarding initiation of arbitral proceedings and also nomination of an Arbitrator, this arbitration request was filed.

4. The respondent entered appearance through its Standing Counsel and filed a counter affidavit. The prime objection raised by the respondent is that the petitioner executed a claim discharge voucher on 12.03.2025, in favour of the respondent accepting an amount of Rs.2,91,87,861/- as full and final settlement. A copy of the discharge voucher dated 12.03.2025 has been produced as Annexure R5. According to the respondent, since the dispute was settled and the petitioner accepted the amount offered and executed a discharge voucher, no arbitrable dispute is existing. Further, the respondent relied on a circular issued by the Insurance Regulatory and Development Authority of India. A copy of the circular has been produced as Annexure R7.

5. Heard the learned Counsel for the petitioner and the learned Counsel for the respondent. The lea