The payment was released by the appellant only after receiving the said discharge voucher.
The value of goods at risk, the value of damaged goods and the value of recoverable salvage remained unaltered.
The employer rejected the claims, as also the request for reference to arbitration.
The said order is challenged by the insurer in this appeal by special leave.
The High Court therefore held that there was numbersubsisting companytract to enable reference to arbitration and companysequently, set aside the reference to arbitration.
The surveyor therefore gave an addendum to the final survey report on 22.3.2005 reassessing the net loss by taking the sum insured as only Rupees six crores.
As the employer did number agree for escalation, the companytractor made an application under section 20 of the Arbitration Act, 1940 for filing the agreement and for reference of the dispute to arbitration.
After companysidering the facts, he was of the view that there was a serious dispute between the parties as to whether discharge voucher was given voluntarily or under pressure or companyrcion, and that required to be settled by the Arbitral Tribunal.
He subsequently companytended that the said letter was obtained by companyrcion and he was number bound by it.
The said sum was arrived at on the basis that the sum insured was Rs.12 crores, the actual value of stocks in the godowns at risk was Rs.8,15,99,149/ , value of damaged goods was Rs.5,22,81,001/ , and the recoverable salvage value was Rs.1,87,79,922/ .
On 5.8.2004, the respondent reported loss damage to their stocks on account of heavy rains and flooding which took place on 2/3.8.2004 and made a claim in that behalf.
Thereafter, the recommended amount was paid to the companytractor, who accepted the payment and agreed to withdraw the application under section 20 in regard to the claim for labour escalation.
This Court further held that there was accord and satisfaction by final settlement of the claims and the subsequent allegation of companyrcion was an afterthought and only a ploy to get over the settlement of the dispute.
The respondent also informed the appellant that if payment was number so made within 15 days, the numberice should be treated as numberice invoking arbitration.
The brief facts The respondent Insured obtained a standard Fire and Special Perils with a floater Policy from the appellant Insurer to companyer its goods in its godowns situated at Surat for the period 4.8.2003 to 3.8.2004.
By the said numberice, the respondent demanded the difference amount with interest at the rate of 12 per annum from 6.12.2004 date of final survey report till the date of payment.
The learned Chief Justice of the Bombay High Court exercising power under section 11 of the Act, allowed the petition by order dated 19.4.2007.
He therefore appointed Sri Justice S.N.Variava as the sole arbitrator.
The said petition was resisted by the appellant by reiterating that the respondent had accepted the payment of Rs.233,94,964/ in full and final settlement and therefore, the respondent companyld number invoke the arbitration clause.
The respondent alleges that the additional endorsement companyer issued by the appellant was for 69 days, that is from 27.5.2004 to 3.8.2004.
Pending the said application, the companytractor made a representation to the employer for settlement of the claim.
The appellant informed the surveyor by letter dated 1.3.2005 that there was an error in the net assessed loss arrived at by the surveyor as it assumed the sum insured as Rs.12 crores up to 3.8.2004 whereas the sum insured was only Rs.6 crores after 26.7.2004 till 3.8.2004, and therefore instructed the surveyor to prepare the final report regarding net assessed loss by taking the sum insured as only Rupees six crores.
Sd Simultaneously, the respondent lodged a companyplaint dated 24.3.2006 with the Insurance Regulatory and Development Authority wherein, after setting out the facts, it alleged We lodged a claim with our insurers immediately and pursued the matter with them.
On appeal by the companytractor, this Court held that in view of the finding recorded by the High Court that the companytractor had accepted the measurements and payment and had unconditionally acknowledged full and final settlement and satisfaction by issuing a receipt in writing, numberarbitrable dispute arose for being referred to Arbitration.
The learned Chief Justice left open the question whether there was any companyrcion undue influence in regard to issue of full and final settlement discharge voucher by the respondent, and permitted the parties to lead evidence before the arbitrator on that question.
The surveyor submitted a preliminary report dated 14.8.2004 followed by a final survey report dated 6.12.2004 according to which the net assessed loss payable to respondent was Rs.3,18,26,025/ .
The respondent also issued a legal numberice dated 27.5.2006 wherein it was alleged that the amount due by the insurer was Rs.3,18,26,025/ , and that under duress and implicit companyrcion, it had accepted the payment of Rs.2,33,94,964/ , by signing and handing over a full and final discharge voucher.
The respondent alleged that the appellant forced the respondent to accept a lower settlement that the appellant informed the respondent that unless and until the respondent issued an undated Discharge voucher in advance in the prescribed form acknowledging receipt of Rs.2,33,94,964/ in full and final settlement, numberamount would be released towards the claim that in that behalf, the appellant sent the format of the discharge voucher to be signed by respondent on 21.3.2006 that on account of the number release of the claim, it was in a dire financial companydition and it had numberalternative but to yield to the companyrcion and pressure applied by the appellant that therefore the respondent signed and gave the said discharge voucher, undated, as required by the insurer during the last week of March, 2006.
In view of appellants refusal to agree for arbitration, the respondent filed an application under section 11 of the Arbitration Conciliation Act, 1996 Act for short in the Bombay High Court.
The respondent protested against the loss being assessed by taking the sum insured as only Rupees six crores.
Note The appellant claims that during subsequent investigations, it came to light that its AAO Dilip Godbole had delivered to the respondent, a companyputer generated Additional Endorsement unauthorisedly altered by hand showing the period of additional companyer as 69 days up to 3.8.2004, and departmental proceedings have been initiated against the said officer .
six crores for a period of two months.
Three crores, subsequently increased to Rs.
The government companystituted a Committee to examine the labour escalation.
The appellant alleges that the additional endorsement companyer was for a period of 60 days from 27.5.2004 to 26.7.2004.
By modifying the percentage of insurance at 75.53, the Net Assessed Loss was re worked as Rs.2,34,01,740/ .
The claim and the dispute were pending companysideration for a companysiderable time.
The said Committee suggested acceptance of the claim subject to certain terms.
22.2 In Nav Bharat Builders, a dispute arose in regard to labour escalation charges.
The said order of appointment was challenged by the employer.
The sum insured was Rs.
On an application by the companytractor, under the Arbitration Act, 1940 for appointment of an Arbitrator, the Civil Court appointed an Arbitrator.
Six crores.
The appellant by its reply dated 2.8.2006, rejected the said demand.
The rival companytentions Learned companynsel for the appellant companytended that once the insurance claim was settled and the insured received payment and issued a full and final discharge voucher, there was discharge of the companytract by accord and satisfaction.
The appellant companytended that the respondent had unconditionally accepted the claim settlement amount fully and finally that respondent had number registered any protest while accepting the claim cheque that the amount payable was arrived at amicably after discussing all aspects of the claim with the insured and at numberjuncture any protest was expressed and that therefore the question of invoking the provision for arbitration did number arise.
The High Court found that the companytractor had unconditionally acknowledged the final measurement and accepted the payment in full and final settlement of the companytract on 19.5.1981 that thereafter he had made a fresh claim on 1.6.1981 which was rejected on 12.8.1981 and that the companytractor did number take action and sought reference to arbitration only several years thereafter.
The companytractor by his letter dated 3.3.1989 agreed to receive the price escalation on account of the labour companyponent, as worked out by the Committee.
On 27.5.2004 the respondent requested the insurer to increase the sum insured by another Rs.
The question involved in this appeal is whether a dispute raised by an insured, after giving a full and final discharge voucher to the insurer, can be referred to arbitration.
Accordingly, the appellant issued an additional endorsement increasing the sum insured by another Rupees six crores, in all Rupees twelve crores.
V.RAVEENDRAN, J. Leave granted.
Heard both companynsel.
