Case Note & Summary
The dispute arose between a construction company and the Union of India regarding a contract for maintenance works. The appellant submitted a tender which was accepted, but faced delays and disputes over payments. After submitting a No Claim Certificate under duress to recover a security deposit, the appellant sought arbitration for unpaid dues. The initial arbitrator found the certificate was signed under coercion but disallowed other claims. A subsequent arbitrator ruled in favor of the appellant, but the Union of India challenged this award. The Calcutta High Court upheld the challenge, stating the No Claim Certificate barred further claims. The Supreme Court, however, found that the No Claim Certificate should not preclude genuine claims, especially given the circumstances of coercion. The court allowed the appeal, setting aside the lower court's judgments and affirming the appellant's right to arbitration despite the No Claim Certificate.
Headnote
A) Arbitration - No Claim Certificate - Effect on Future Claims - Arbitration and Conciliation Act, 1996, Section 11 - The court held that the submission of a No Claim Certificate does not bar a contractor from raising genuine claims, especially when such certificate was signed under coercion. The Division Bench's ruling that the No Claim Certificate precluded further claims was found to be erroneous (Paras 1-5).
Issue of Consideration
Whether the submission of a No Claim Certificate precludes the appellant from raising further claims under the contract.
Final Decision
The Supreme Court allowed the appeal, set aside the judgments of the Calcutta High Court, and affirmed the appellant's right to arbitration despite the No Claim Certificate.
Law Points
- Arbitration
- No Claim Certificate
- General Conditions of Contract
- Coercion
- Duress
