IMPORTANT POINT
The central legal point established in the judgment is the exclusive supervisory jurisdiction of the seat Court over arbitral proceedings and the inapplicability of Section 42 of the Act when the prior application was entertained without jurisdiction.

JUDGMENT

Prateek Jalan, J. (Oral)

I.A. 22893/2023 (Exemption)

Exemption allowed, subject to all just exceptions.

The application stands disposed of.

O.M.P. (COMM) 468/2023 & I.A. 22892/2023 (seeking ad interim ex- parte stay of the impugned award), I.A. 22894/2023 (to file additional documents)

1. The petitioner has filed this petition under Section 34 of the Arbitration and Conciliation Act, 1996 ["the Act"], to assail an arbitral award dated 03.03.2021. By this judgment, I propose to decide a preliminary objection taken by the respondent as to territorial jurisdiction of this Court.

2. On the last date of hearing i.e. 09.02.2024, such a preliminary objection was taken on the ground that the petitioner had earlier instituted a petition under Section 9 of the Act before the District Judge, Balasore, Odisha. It was submitted by Mr. Madhu Sudan Bhayana, learned counsel for the respondent, that, by operation of Section 42 of the Act, the concerned Court in Odisha alone would have jurisdiction to entertain Section 34 proceedings. It was also pointed out that the respondent had filed O.M.P.(T)(COMM.) 19/2015 before this Court, which was dismissed on this ground by an order dated 14.12.2015. The petitioner herein was represented when the said order was passed. It is submitted that jurisdiction having been asserted by the petitioner itself in Balasore, on which basis it also resisted the jurisdiction of this Court in the earlier proceedings, the petitioner cannot now move this Court under Section 34.

3. In response to this preliminary objection, Mr. Akhil Sibal, learned Senior Counsel for the petitioner, submits that the seat of the arbitration was admittedly in Delhi. He argues that the Courts in Delhi are therefore vested with exclusive supervisory jurisdiction over the arbitral proceedings. Mr. Sibal accepts both, that the jurisdiction of the Balasore Court was wrongly invoked by the petitioner, and the jurisdiction of this Court was rightly invoked by the respondent in O.M.P.(T)(COMM) 19/2015. However, in view of the fact that the Balasore Court had no jurisdiction to entertain the Section 9 petition, he submits that Section 42 of the Act is not attracted. For this purpose, he cites the decision of the Supreme Court in BBR (India) (P) Ltd. vs. S.P. Singla Constructions (P) Ltd., (2023) 1 SCC 693: 2022 LAWPACK(SC) 66658: 2022(3) R.A.J. 387.

4. The submission of Mr. Sibal is, in my view, merited. The arbitration was in respect of disputes under an agreement dated 17.07.2006. It contains an arbitration clause, numbered as Clause 17 [although it appears between Clauses 15 and 16]. The said clause reads as follows:

"17. Arbitration

17.1 Any dispute, controversy or claim ("Dispute") arising out of, relating to, or in connection with this MOA or the breach, termination or validity hereof, shall initially be resolved by amicable negotiations among executives of the Parties and, if not resolved through such negotiations within days of written notice of the existence of such Dispute, be finally settled in accordance with the rules of Indian Council of Arbitration.

17.2 The arbitration shall be conducted in accordance with the Indian Arbitration and Conciliation Act, 1996 and it shall be conducted in the English language and the venue shall be at New Delhi.

17.3 The arbitral award shall be in writing, state the reasons for the award, and be final and binding on the Parties concerned. The award may include an award of costs, including reasonable attorneys' fees and disbursements. Judgment upon the award may be entered by any court having jurisdiction thereof or having jurisdiction over the relevant Party or its assets."

Emphasis supplied

5. It is clear from Clause 17.2 that New Delhi was expressly designated as the "venue" of the arbitration. The arbitration was to be held in accordance with the Rules of the Indian Council of Arbitration ["ICA"]. A designation of "venue" is, in terms of the judgment of the Supreme Court in BGS SGS SOMA JV vs. NHPC, (2020)