The distinction between 'seat' and 'venue' of arbitration is crucial, with the seat determining jurisdiction, which in this case was Ahmedabad despite the venue being New Delhi.

ORDER :

(Sunita Agarwal, CJ.) :

1. Heard Ms. Hetvi Sancheti, learned advocate for the petitioner and Mr. Nachiket D. Mehta, learned advocate for the respondent and perused the record.

2. The dispute raised in the instant petition filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (“the Act’ 1996”), is about the jurisdiction of this Court to make a reference. On the notice invoking arbitration clause sent by the petitioner, the respondent, referring to Clause 14.3 contained in dispute resolution Clause 14, had objected about the jurisdiction of this Court with the assertion that the place of arbitration seat in the contract is at New Delhi. The High Court, therefore, would be without jurisdiction to make a reference under Section 11 of the Arbitration Act.

3. The reliance is placed by the learned counsel for the respondent on the decisions of the Apex Court in the case of Indus Mobile Distribution Private Limited vs. Datawind Innovations Private Limited and others, (2017)7 SCC 678 and the judgement of the High Court of Delhi in the case of M/s.Devyani International Ltd. vs. Siddhivinayak Builders and Developers, 2017 SCC OnLine (Del) 11156 to substantiate his submissions that this Court has no territorial jurisdiction to agitate the present petition.

4. Ms. Sancheti, learned advocate appearing for the petitioner, however, would rely on the judgement of this Court in Instakart Services Private Limited vs. Megastone Logiparks Pvt. Ltd., 2024(1) GLH 180 to submit that the issue is squarely covered by the decision of this Court and the “place of arbitration” cannot be confused with “seat”. The place of arbitration being at New Delhi contained in clause 14.3 only enables the arbitral tribunal to meet at any place for conducting hearings at a place of convenience, in accordance with Section 20(3) of the Act’ 1996. Further reference has been made to clause 16.6, which deals with the governing laws and provides that the deed and any consequence arising therefrom shall be governed by the laws of India and shall be under the jurisdiction of the Courts at Ahmedabad.

5. Dealing with the submissions of the learned counsels for the parties, we may note the provisions of Section 20 contained in Chapter V, which contains the procedure for conduct of arbitral proceedings. Section reads as under:-

“20. Place of arbitration.—(1) The parties are free to agree on the place of arbitration.

(2) Failing any agreement referred to in sub-section (1), the place of arbitration shall be determined by the arbitral tribunal having regard to the circumstances of the case, including the convenience of the parties.

(3) Notwithstanding sub-section (1) or sub-section (2), the arbitral tribunal may, unless otherwise agreed by the parties, meet at anyplace it considers appropriate for consultation among its members, for hearing witnesses, experts or the parties, or for inspection of documents, goods or other property.”

6. A careful reading of Section 20 indicates that the parties are at freedom to agree on the place of arbitration and in case of failure of the parties, the place of arbitration shall be determined by the arbitral tribunal, having due regard to the circumstances of the case including the convenience of the parties. Sub-section (3) of Section 20 begins with the nonobstante clause and provides that the unless otherwise agreed by the parties, the arbitral tribunal may meet at any place it considers appropriate for consultation amongst its members, for hearing witnesses, experts or the parties, or for inspection of documents, goods or other property. The conjoint reading of sub-sections (1) to (3) of Section 20 leads to the conclusion that in the event, the parties do not agree with regard to the place of arbitration, the arbitral tribunal would be free to decide the venue of the arbitration.

7. This Court in Instakart Services Private Limited (supra) has examined the distinction between “place” or “venue” or “seat” of arbitration.

8. N