The exclusive jurisdiction clause agreed between the parties determines the territorial jurisdiction of the Court to entertain a petition challenging an arbitral award.

JUDGMENT

V. Kameswar Rao, J. The present Appeal has been filed by the appellant herein against the order dated November 29, 2022 passed by the District Judge (Commercial Court), Shahdara, Karkardooma Delhi, rejecting the petition filed by the appellant under section 19 of the Micro, Small, and Medium Enterprises Development Act, 2006 (`MSMED Act') read with Section 34 of the Arbitration and Conciliation Act, 1996 (`Act of 1996'). The appellant has specifically prayed for the following reliefs through this instant petition:

"In the premises, aforesaid, the Appellant prays that this Hon'ble Court may be pleased to:

1. May call for the records of the OMP (COMM) 01 of 2022 lying in the court of Ld. District Judge (Commercial Court) 04, Shahdara, Karkardooma Delhi;

2. And may set aside the impugned order dated 29.11.2022 passed in OMP (COMM) No. 01 of 2022.

3. And may make any such other and further Orders as it may deem fit"

2. The facts which led to the filing of the present appeal are as follows:

2.1. It is stated that the appellant issued Purchase Order dated September 25, 2013 to the respondent for Supply, Erection, testing & commissioning of 02 nos. 20 MT Mounded underground LPG Storage Bullet & Pipeline for a Rail Coach Factory, Rae Bareli (U.P).

2.2. It is further stated that the subject work was completed by July 21, 2015. The respondent had also issued a `No Claim Certificate' dated November 05, 2015 for Rs.1,12,95,207/- which was the agreed amount towards full and final payment between the appellant and the respondent.

2.3. It is stated that the respondent had applied for the registration under section 8 of the MSMED Act, on July 25, 2016 and consequently got registered under the provisions of the MSMED Act.

2.4. It is further stated that the respondent had also sent a legal notice dated February 02, 2017, to the appellant, wherein it was admitted that it had issued a `No Claim Certificate' after having agreed on Rs.1,12,95,207/- being the full and final payment. It is further submitted that out of this, an amount of Rs.1,01,81,349/- had been received by the respondent. However, the amount of Rs.11,13,858/- was withheld by the appellant subject to the respondent submitting proof of actual tax paid by it under Clause 5.2 of the Conditions of Contract (entered between the parties herein). This fact was also clarified by the appellant by submitting its reply dated March 08, 2017, wherein it sought proof of tax having been paid by the respondent for the said amount.

2.5. Aggrieved by not receiving of the said amount, the respondent lodged its claim with Micro and Small Enterprises Facilitation Council, on December 11, 2018. Specifically, it had raised a claim of Rs.36,49,707/- towards deduction qua Liquidated Damages and Rs.33,53,694.15/- towards interest thereon.

2.6. It is further stated that conciliatory process had failed and thus the matter was further referred to arbitration in September 2019.

2.7. Thereafter, vide award dated January 09, 2022, an award amounting to Rs.63,35,077/- was passed in favour of the respondent and against the appellant.

2.8. To challenge the afore-said award passed against the appellant, the appellant filed a petition under section 19 of the MSMED Act read with section 34 of the Act of 1996, bearing No. OMP (COMM) No.01/2022, before the District Judge, Commercial Court, Shahdara, Karkardooma, Delhi.

2.9. Aggrieved by the impugned order dated November 29, 2022, passed in the afore-said case, whereby the said petition was dismissed by the District Court on the ground of lack of territorial jurisdiction to entertain the petition, the appellant has filed the instant FAO.

3. It is stated by Mr. Chandan Kumar, learned counsel appearing for the appellant that the impugned order is illegal on the following grounds:

3.1. The impugned order has been passed contrary judgment of the Supreme Court in the case of Gujarat State Civil Supplies Corporation Ltd. vs. Mahakali Foods Pvt. Ltd. (Unit 2) and Another, 2