The arbitration clause was limited to disputes arising from work done in Lucknow, with no jurisdiction over claims for work in other districts.

JUDGMENT :

Jaspreet Singh, J.

1. The instant appeal preferred, under Section 37 of the Arbitration and Conciliation Act 1996, by the appellants assails the judgment and order dated 06.11.2024 passed by the Commercial Court No.1, Lucknow in Arbitration Case No.35 of 2019, whereby the petition preferred by the appellants under Section 34 of the Arbitration and Conciliation Act 1996 was dismissed and as a consequence the award passed by the Sole Arbitrator dated 31.12.2018 was affirmed.

2. The controversy involved in the instant appeal is ensconced in a narrow compass. The core contention revolves around the scope of the arbitration clause vis-a-vis the area of operation of the agreement dated 01.08.2016,containing the arbitration clause.

3. In order to resolve the controversy, it will be necessary to take note of certain facts giving rise to the instant appeal.

4. The appellants are a Corporation engaged in the sale and distribution of mobile phones/handsets and accessories under the brand of 'VIVO Mobile'. The respondent no.1, on the other hand, is a partnership firm of which the respondents no.2 and 3 are the partners who are engaged in the business of advertising and providing marketing services.

5. On 01.08.2016, an agreement was entered between the appellants and the respondents and in furtherance of the said agreement, the respondents had agreed to act as an advertising agent for the appellants. The agreement stated that the appellants were the exclusive dealer of 'VIVO Mobile' Handsets and Accessories for the State of Uttar Pradesh and it was desirous to engage the services of an advertising agency for advertising the products in the city of Lucknow. The said agreement also contained an arbitration clause.

6. The agreement between the parties was acted upon and accordingly the appellants' Corporation assigned advertising work to the respondents from time to time. Work Orders issued by the appellants was executed by the respondents, who in turn raised invoices for the work done and the same was paid by the appellants.

7. Certain disputes arose between the parties and the appellants by means of its email dated 28.03.2017 terminated the agreement dated 01.08.2016. The respondents invoked the arbitration clause and the Indian Council of Arbitration appointed Dr. Dharmesh Sharma as the Sole Arbitrator.

8. On 27.06.2017, a statement of claim was filed by the respondents which contained claims relating to non payment of the invoices for the work done by the respondents not only within the city of Lucknow but also in respect of work done by the respondents in districts other than Lucknow, however, within the State of U.P. The appellants filed their statement of defence before the Sole Arbitrator and inter alia raised a defence, that in so far as the claims raised by the respondents relating to non payment of invoices for the work done in the districts other than Lucknow was concerned, it was beyond the scope of arbitration clause and agreement.

9. It was also alleged that once the agreement dated 01.08.2016 was terminated and the respondents were put to notice then it should have desisted from carrying out any further work. Moreover, any work done by the respondents was beyond the authority and any claim arising there from was not admissible for adjudication nor the appellants could be compelled to honour the same.

10. The Sole Arbitrator after considering the p