In Absence Of Separate 'Seat' Clause In Arbitral Agreement, Court Mentioned In 'Venue' Clause Has Exclusive Jurisdiction: Patna HC

The Patna High Court bench of Acting Chief Justice Ashutosh Kumar has held that in the absence of any clause in the agreement apart from Clause 36.3, which speaks of the “venue” being Delhi, there cannot be any other inference or intention of the parties for the “venue” and the “seat” being different. Additionally, the court noted that the agreement in question does not mention the “seat” of arbitration but only mentions the “venue” for arbitration, which shall be at New Delhi. Thus, Delhi High Court only shall have the jurisdiction to adjudicate the present request. Brief Facts of the case: The dispute arose with respect to a dealership agreement under which the petitioner agreed to become a dealer for the electric vehicles manufactured by the respondent. Since the supply of vehicles were not made on time, the dealership agreement was terminated by the petitioner. Then, the petitioner invoked the arbitration clause provided in the agreement and asked the respondent to either consent to the name of the Arbitrator provided by the petitioner or propose a name at their end. But the parties were not able to choose the arbitrator so, the petitioner filed a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of an independent/impartial Arbitrator for resolution of the dispute between the parties. The respondent contended that this court would not have the jurisdiction to entertain the petition in view of Clause 36.3 which, in clear terms, provides that the “venue” of arbitration would be in New Delhi, and thus, the jurisdictional Court would be the High Court of New Delhi. However, the petitioner relied on the judgment in Ms. Ravi Ranjan Developers Pvt. Ltd. Vs. Aditya Kumar, (2022), wherein the Supreme Court has held that “seat of arbitration” and “venue of arbitration” cannot be used interchangeably and that the “venue of the arbitration” cannot be the basis for determining the intention of the parties that the same place has the “seat of arbitration”. Observation of the Court: The court relied on the judgment in Brahmani River Pellets Limited vs. Kamachi Industries Limited, (2020), wherein the court held that where the contract specifies the jurisdiction of a Court at a particular place, only such Court will have the jurisdiction to deal with the matter and it would be presumed that the parties intend to exclude all other Courts. If the parties agree that the “venue of arbitration” shall be at a particular place, the intention of the parties is to exclude all other Courts. Moreover, the court noted that the agreement in question does not mention the “seat” of arbitration but only mentions the “venue” for arbitration, which shall be at New Delhi. Thus, Delhi High Court only shall have the jurisdiction to adjudicate the present request. Further, the court held that in the absence of any clause in the agreement apart from Clause 36.3, which speaks of the “venue” being Delhi, there cannot be any other inference or intention of the parties for the “venue” and the “seat” being different. Finally, the court rejected that petition. Case Title: M/s Pramila Motors Pvt. Ltd. versus M/s Okinawa Autotech International Pvt. Ltd.LL Citation: 2025 LiveLaw (Pat) 21 Case Number: REQ. CASE No.53 of 2024 Counsel for the Petitioner: Mr. Abhishek Kumar, Advocate Counsel for the Respondent: Mr. Anurag Bhatt, Advocate Date of Judgment: 22.03.2025 Click Here To Read/Download The Order

In Absence Of Separate 'Seat' Clause In Arbitral Agreement, Court Mentioned In 'Venue' Clause Has Exclusive Jurisdiction: Patna HC

Soumya Chakrabarti

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Soumya Chakrabarti

In Absence Of Separate 'Seat' Clause In Arbitral Agreement, Court Mentioned In 'Venue' Clause Has Exclusive Jurisdiction: Patna HC

Soumya Chakrabarti

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Soumya Chakrabarti

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