An agreement can confer exclusive jurisdiction to a specific court, waiving objections to jurisdiction in other courts, provided that the clause is valid under Section 23 of the Contract Act.

JUDGMENT :

SURESHWAR THAKUR , J.

1. The present reference becomes generated from the order pronounced by the learned Single Bench of this Court, on 04.10.2010 upon CR-5492-2010, whereins, the learned Single Bench of this Court has passed the following order:-

“Whether the agreement to submit to the jurisdiction of one Court impliedly ousts the jurisdiction of all other Courts?”

2. Consequently, under the orders of the Hon’ble Chief Justice, the instant Larger Bench has been constituted.

3. The counsels appearing today before this Court have been heard at length.

4. A specific clause 13(b), is borne in the ISDA Agreement, as became executed between the parties concerned, the said clause becomes extracted hereinafter.

“Clause 13(b) With respect to any suit, action or proceeding relating to this agreement (“proceedings”) and party irrevocably:

(i) submits to the jurisdiction of the High Court of Mumbai in India; and

(ii) waives any objection which it may have at any time to the laying of the venue of any proceedings brought in any such court and waives the right to object, with respect to such proceedings, that such court does not have jurisdiction over such party.

Nothing in this agreement precludes Party B from bringing proceedings in any other court, tribunal or appropriate forum in India, nor will bringing of proceedings in any one or more jurisdictions preclude the bringing of proceedings in any other jurisdiction.”

5. In the (supra) extracted clause, there is ad idem conferment of competent adjudicatory jurisdiction, by the contracting parties vis-avis the High Court of Mumbai. Moreover, therebys the contracting parties, have evidently abandoned and waived their rights, to raise any objection, which they may subsequently have, in respect of the (supra) ad idem contractually agreed competent adjudicatory venue. Therefore, excepting the above ad idem contractually agreed competent adjudicatory venue, the contracting parties have therebys waived and abandoned their rights to raise the apposite disputes, as may arise, from the makings of the apposite breaches, thus before any other forum.

6. Reiteratedly (supra) clause also consensually bestows exclusive competent adjudicatory jurisdiction in respect of disputes as may emerge amongst them, and, as may arise from breaches if any being made by one or the other party vis-a-vis any of the contractual covenants, which occur in the executed contact amongst them.

7. The assigning of validity qua conferment of consensual jurisdiction, through (supra) clause borne in the ISDA agreement, vis-a-vis the High Court at Mumbai, thus for adjudicating any dispute as may emerge amongst them, but however obviously is to become made, subject to the apposite cause of action in whole or in part arising within the apposite consensually chosen adjudicatory jurisdictional venue.

8. The (supra) conferment of consensual jurisdiction through (supra) borne clause vis-a-vis the High Court at Mumbai, thus rather has been validated by the Hon’ble Apex in a judgment rendered in Hakam Singh V. Gammon India Ltd. 1971(1) SCC 286. The relevant paragraph of the said judgment becomes extracted hereinafter.

“Disputes arose between the parties and the appellant submitted a petition to the Court of the Subordinate Judge at Varanasi for an order under S.20 of the Indian Arbitration Act 10 of 1940 that the agreement be filed and an order of reference be made to an Arbitrator or Arbitrators appoint