TaxTMI 
TaxTMI 
2020 (6) TMI 828
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.... the respondents requested the applicant for carrying out certain modifications in store FF of block 'A' and provision of steel window at staircase for aesthetic view of block 'A' and 'B'. Believing the respondents to be acting bonafide, the applicant carried out the modifications as per the instructions of the respondents. The applicant requested the respondents for release of the payment for the work done, but the respondents are postponing the same on one pretext or the other and on persistent requests by the applicant, the respondents revealed that the said items used for modifications are not scheduled items and as such unable to make payments. After repeated attempts to settle the disputes, the applicant issued a notice, dated 30.03.2013 to the 1st respondent seeking for appointment of arbitrator as per conditions 70 and 71 of IAFW-2249 within 30 days. When the applicant tried to contact the respondents to settle the disputes amicably, respondents started ignoring even the applicant's phone calls. Hence, the applicant filed an application, dated 06.05.2013 before the 4th respondent listing out the claims. It is stated that the respondents got issued reply on 18.06.2013 statin....
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....r the additional work done and postponing the same on one pretext or other. Only on the assurance given by the respondents that they will pay the extra cost for extra work, the applicant had undertaken the extra work. That the respondents have not disputed about existence of arbitration clause. The scope of enquiry under Section 11 (6) of the Act is very limited and merits and demerits of the claims cannot be considered in this application. In support of his contention, he placed reliance on a Judgment of the Apex Court in National Insurance Company Limited v. M/s. Boghara Polyfab Private Limited 2009 (1) SCC 267 6. On the other hand, Sri N.Rajeshwar Rao, learned counsel for the respondents would submit that the applicant submitted final bill without specific claim/protest and "No further claim certificate" was signed by the applicant at the time of submission of final bill, therefore, the accord and satisfaction has been fulfilled as per Section 63 of the Indian Contract Act. He further submitted that as per condition No.65 of IAFW 2249 forming part of the contract agreement, no further claim shall be made by the applicant (contractor) after submission of final bill. He f....
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....hpur Post Bangalore- 560 022." A perusal of the aforesaid letter addressed by the applicant to the 1st respondent goes to show that the applicant simply referred to the Construction of ADM-CUM-TECH Accn (13 Rooms) at Hakimpet, Hyderabad CE (AF)/BAN/20 of 2010- 2011 and straight away requested to appoint an arbitrator within 30 days. There is no mention about the works done by the applicant i.e., Construction of ADM-CUM-TECH Accn (13 Rooms) at Hakimpet, Hyderabad, outside the scope of contract agreement with the respondents. Without mentioning anything with regard to the alleged payments towards additions/alterations by the respondents, the applicant straight away issued notice invoking arbitration clauses 70 & 71 of IAFW 2249. That apart, it was the specific allegation of the learned counsel for the applicant that the amount under Final Bill was paid under coercion and undue influence, without mentioning the additions/alterations, as agreed by the respondents. But, the said coercion and undue influence as alleged by the applicant against respondents was neither pleaded in any of the correspondence by the applicant nor was specifically adverted to in the notice invoking ....
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....considering an application under Section 11(6) of the Act, the Hon'ble Supreme Court held that if the party is unable to establish a claim of undue influence or fraud, or appears to be lacking in credibility, it is not open to the Court to refer the dispute to arbitration. (see ONGC Mangalore Petrochemicals v. ANS Constructions Limited 2018 (3) SCC 373). A bald plea of undue influence is not sufficient, the applicant has to establish a prima facie case. Without establishing the prima facie case, fraud and undue influence by placing material on record, applicant is not entitled for referring the matter to the arbitration. (see New India Assurance Company Limited v. Genus Power Infrastructure Limited (2015) 2 SCC 424). When once one of the parties adopts a path of full understanding and executes a document in furtherance of the same, it is not open to him to take recourse of arbitration thereafter. (see Wapcos Limited v. Salma Dam Joint Venture reported in 2020 (3) SCC 169[2019 SCC Online 1464]. 11. In National Insurance Co., Limited v. Boghara Polyfab Private Limited (supra), the Hon'ble Supreme Court has enunciated three categories of issues that may arise where the intervention....