Court At Designated Seat Would Have Exclusive Jurisdiction To Entertain Applications Arising Out Of Arbitration: Chhattisgarh HC

The Chhattisgarh High Court bench of Justices Shri Sanjay K. Agrawal and Shri Radhakishan Agrawal has held that court having supervisory jurisdiction over seat designated in the Arbitration Agreement would have exclusive jurisdiction to entertain all applications arising out of the arbitration proceedings. Brief Facts The present appeal has been filed under section 37 of the Arbitration Act against an order passed by the Commercial Court on August 6, 2024 by which an application by the appellant under section 9 was rejected on the ground that the arbitration agreement in clause 54 of the L6 Partner Agreement designates Chennai as seat of arbitration therefore the court at Chennai would have exclusive jurisdiction to entertain the application as per judgment of the Supreme Court in BGS SGS Soma JV v. NHPC Limited (2020). It is the case of the appellant that the learned Commercial Court is absolutely unjustified in rejecting the application as not maintainable, it ought to have entertained the application on merits and should have decided the same on merits. It is the contention of the respondents that in view of the exclusive jurisdiction clause holding that the seat of arbitration will be at Chennai, the Commercial Court is absolutely justified in holding that the application under Section 9 of the A&C Act was not maintainable and the instant appeal deserves to be dismissed. Observations: The court observed that the learned Commercial Court after noticing that the seat of arbitration proceeding will be at Chennai and that is the exclusive jurisdiction clause, considered the decision of the Supreme Court in BGS SGS Soma JV (supra) wherein it was held that “ where parties have selected the seat of arbitration in their agreement, such selection would then amount to an exclusive jurisdiction clause, as the parties have now indicated that the courts at the “seat” would alone have jurisdiction to entertain challenges against the arbitral award which have been made at the seat.” In Indus Mobile Distribution (P) Ltd. v. Datawind Innovations (P) Ltd, 2017 the Supreme Court has held that “the moment the seat is designated, it is akin to an exclusive jurisdiction clause.” Finally, the court observed that in light of the above “we are of the considered opinion that the Commercial Court is justified in holding that it has no jurisdiction to adjudicate the application under Section 9 of the A&C Act in view of the exclusive jurisdiction clause in the contract agreement i.e. L6 Partner Agreement and further justified in rejecting the application as not maintainable, which is absolutely in accordance with law.” Accordingly, the present appeal was dismissed. Case Title: M/s. Radhakishan Ventures Private Limited versus M/s Caratlane Trading Private Limited and Ors. Case Number: Arbitration Appeal No.30 of 2024 Judgment Date: 3/12/2024 Click Here To Read/Download The Order

Court At Designated Seat Would Have Exclusive Jurisdiction To Entertain Applications Arising Out Of Arbitration: Chhattisgarh HC

Mohd Malik Chauhan

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