Arbitral review: unproved GST payment and unsupported waiver or estoppel can render reimbursement findings patently illegal.

Arbitral review under Section 34 is discussed as limited where an award adopts a plausible contractual interpretation, particularly on reimbursement of GST paid on gas-transmission charges; statutory GST liability remains for GST authorities. The notes identify patent illegality where a tribunal relies on GST deposit receipts after leaving their admissibility undecided, without supporting returns, transaction records or accounts proving payment attributable to the claimant. They further explain that waiver requires intentional relinquishment of a known right, while estoppel requires representation, reliance and alteration of position. Contractual pre-dispute payment requirements and payment of earlier invoices do not, by themselves, establish waiver, estoppel or extinguish recurring claims.

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Issues: (i) Whether the contractual interpretation requiring reimbursement of GST paid on gas-transmission charges was liable to interference under Section 34; (ii) Whether the finding that GST had been deposited with the authorities was sustainable without deciding the objection to admissibility of the tax receipts; (iii) Whether the petitioner was barred by waiver, estoppel, or Clause 12.6 of the Gas Sale Agreement from claiming reimbursement.

Issue (i): Whether the contractual interpretation requiring reimbursement of GST paid on gas-transmission charges was liable to interference under Section 34.

Analysis: The dispute in arbitration was confined to contractual reimbursement and did not require determination of the statutory exigibility of GST, which lay within the jurisdiction of the GST authorities. The contractual construction that title passed at the delivery point and that VAT was payable on a price inclusive of the GST component was a plausible interpretation of the Gas Sale Agreement. A possible and reasonable contractual interpretation cannot be substituted in arbitral-review jurisdiction merely because another view is available.

Conclusion: The finding that tax actually paid was contractually reimbursable was not independently open to interference and was in favour of the respondent.

Issue (ii): Whether the finding that GST had been deposited with the authorities was sustainable without deciding the objection to admissibility of the tax receipts.

Analysis: The arbitral tribunal deferred the objection to the admissibility of GST deposit receipts but did not determine it before relying on those receipts. The receipts, unsupported by GST returns, purchase and sale records, filed documents, or books of account, did not establish payment of GST attributable to gas transmitted to the petitioner. Non-cross-examination on documents whose admissibility remained undecided did not relieve the respondent of its burden to prove payment.

Conclusion: The finding that the respondent deposited GST on the transmission charges was perverse for want of admissible evidence and was in favour of the petitioner.

Issue (iii): Whether the petitioner was barred by waiver, estoppel, or Clause 12.6 of the Gas Sale Agreement from claiming reimbursement.

Analysis: Waiver requires a conscious and intentional abandonment of a known right, and the party asserting it bears the burden of proof. Estoppel requires an unequivocal representation intended to be acted upon, actual reliance, and alteration of position. Neither the requisite knowledge and intentional relinquishment nor a representation, reliance, and change of position by the respondent was established. Clause 12.6 required payment before a quantified claim could be lodged, supporting the position that payment was necessary to preserve uninterrupted supply. Each invoice gave rise to a recurring cause of action; payment of earlier invoices did not extinguish claims arising from subsequent invoices, including invoices issued after objection was raised.

Conclusion: The findings of waiver, estoppel, and a complete bar under Clause 12.6 were patently illegal and were in favour of the petitioner.

Final Conclusion: The evidentiary and contractual-bar findings forming the basis for rejecting the reimbursement claim were unsustainable, rendering the arbitral award liable to be set aside.

Ratio Decidendi: An arbitral finding founded on documents whose admissibility was left undecided and on unproved waiver or estoppel suffers from patent illegality; prior payment under a contract requiring payment before dispute does not by itself establish waiver, estoppel, or extinguish recurring claims.

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