Page 1/26

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

%

+

OMP (COMM) 536/2020

GOYAL MG GASES PRIVATE LIMITED

.....Petitioner

Through:

Mr. Simran Mehta, Adv.

Versus

STEEL AUTHORITY OF INDIA

.....Respondent

Through:

Mr. Sandeep Sethi, Sr. Adv. with

Ms. Veronica Mohan and Ms. Deepa

Chansoliya Advs.

CORAM:

HON'BLE MR. JUSTICE V. KAMESWAR RAO

V. KAMESWAR RAO, J. (ORAL)

1. This petition has been filed under Section 34 of the

Arbitration & Conciliation Act, 1996 (‘Act of 1996’, for short)

challenging the Award dated May 05, 2020.

2. A preliminary objection has been taken by Mr. Sandeep

Sethi, Ld. Sr. Counsel appearing for the respondent that this petition

is not maintainable in this Court. In this regard, he stated that the

Agreement dated July 20, 2005 (‘Agreement’, for short) between

the parties contains an arbitration clause in Article 25.4 (‘arbitration

clause’, for short) which clearly states that (i) the arbitration

proceedings shall be held in Durgapur, West Bengal and (ii) the

Courts of Durgapur, West Bengal shall have exclusive jurisdiction

over all matters of dispute. The parties have expressed their clear

and unmistakable intent in writing that the juridical seat of the

arbitration shall be at Durgapur, West Bengal with vesting of

exclusive jurisdiction on the courts at Durgapur, West Bengal.

2020:DHC:3272

Page 2/26

3. In the present case while for convenience sake, the hearing

of arbitration was held at New Delhi, the juridical seat remained to

be Durgapur, West Bengal as per the arbitration clause. The

petitioner has failed to disclose any circumstances or any instrument

in writing denoting any change in the choice of seat of the

arbitration. Further, there was no agreement between the parties to

alter the seat of the arbitration. The parties only chose to hold the

proceedings in New Delhi for the sake of convenience. He draws

the attention of the Court to Article 28.3 of the Agreement, which

clearly stipulates that any amendment to the Agreement has to be in

writing signed by the representatives of the parties. In the absence

of any such agreement in writing, the exclusive jurisdiction and

choice of seat clause contained in Article 25.4 is binding on both

the parties. Hence, this Court does not have any jurisdiction to

entertain the present petition. Mr. Sethi stated that the petitioner has

suppressed the fact that the respondent had already invoked the

jurisdiction of Commercial Court at Asansol in accordance with

Article 25.4 of the Agreement, which was duly served on the

petitioner on October 01, 2020.

4. It is the submission of Mr. Sethi that the Courts of the seat

of arbitration shall have exclusive jurisdiction to decide petition

under Section 34 of the Act of 1996. In this regard, he has relied

upon the judgment of the Supreme Court in the case of BGS SGS

SOMA JV vs. NHPC, (2020) 4 SCC 234. According to Mr. Sethi,

change of venue does not override choice of seat under arbitration

agreement. He also relied upon the judgment of the Supreme Court

in the case of Bharat Aluminium Co. v. Kaiser Aluminium

2020:DHC:3272

Page 3/26

Technical Services Inc., (2012) 9 SCC 552, to contend that the

fixation of a venue for arbitration for the sake of convenience

cannot override a clear and unambiguous choice of the seat under

the arbitration agreement itself. He stated that the clear intent of the

parties as stated in the arbitration clause in the absence of any

ambiguity shall be the determinative test of the seat of arbitration.

Mr. Sethi has drawn the attention of the Court to Section 20 of the

Act of 1996 which incorporates the principle of party autonomy as

the only determinant of the juridical seat of an arbitration. Section

20(3) provides the Tribunal choice of venue for convenience and

expeditious conduct of the arbitration. This clearly denotes the

legislative intent that changes i