SPECTRUM POWER GENERATION LIMITED Vs. GAIL (INDIA) LIMITED

JUDGEMENT

(1.) The petitioner seeks to invoke the jurisdiction of the Court conferred by Sec. 11(6) of the Arbitration and Conciliation Act, 1996 [the Act] for appointment of a Sole Arbitrator in light of the disputes which have arisen between the parties and in terms of the provisions made in the Gas Sale Agreement [GSA] which came to be executed between the parties on 18/12/2015.

(2.) The petitioner asserts that from the time of commencement of the contract for supply of natural gas, the respondent raised invoices billing it under the heads of (i) gas price, (ii) marketing margin, (iii) transmission charges, (iv) Goods and Service Tax [GST] costs @ 18% on the aforesaid and (v) Value Added Tax [VAT] on the sum total of gas price. The aforesaid invoices were acknowledged and payments made by the petitioner accordingly.

(3.) It is however contended that subsequently the petitioner came to realize that it had been incorrectly foisted with liability towards GST and in contravention of the provisions of the GSA itself. In view of the aforesaid, a notice for conciliation in terms of Article 15 of the GSA came to be issued on 6/10/2021. However, and since the disputes could not be amicably resolved, the petitioner invoked the arbitration clause by issuance of a notice dtd. 6/12/2021. The notice alleged that a sum of Rs. 22,40,50,273.00 had been wrongfully and illegally invoiced, collected and received by Gas Authority of India Limited [GAIL] under the GSA.