Uttarakhand High Court
Union Of India vs M/S Jyoti Enterprises on 1 April, 2025
Author: Ravindra Maithani
Bench: Ravindra Maithani
HIGH COURT OF UTTARAKHAND AT NAINITAL
Writ Petition No. 894 of 2025 (M/S)
Union of India ..........Petitioner
Vs.
M/s Jyoti Enterprises ..... Respondent
Present :
Mr. V.K. Kaparuwan, Advocate for the petitioner/Union of India.
JUDGMENT
Hon’ble Ravindra Maithani, J. (Oral)
The challenge in this petition is made to the order
dated 17.01.2025, passed in Misc. Case No.115 of 2024, Union of
India Vs. M/s Jyoti Enterprises, by the court of I Additional District
Judge, Commercial Court, Haldwani, District Nainital. By it, it was
held that the court has no jurisdiction to hear the petition under
Section 34 of the Arbitration and Conciliation Act, 1996 (“the Act”).
2. Heard learned counsel for the petitioner and perused the
record.
3. The respondent responded to an online tender issued by the
petitioner for the work of construction of Income Tax Building and
Residential Quarters including internal sanitary installation, water
supply and drainage at Kashipur, District Udham Singh Nagar. The
respondent was the successful bidder. He was awarded the work.
Some dispute arose and the matter was referred to the arbitration.
The arbitration gave its award on 28.09.2024. An application under
Section 34 of the Act was filed in the court of I Additional District
Judge, Commercial Court, Haldwani. The court held that in the
instant matter, the arbitrator, with the consent of both the parties,
determined that Delhi NCR is the seat of arbitration. In view of it,
the court, in the impugned order, held that that court has no
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jurisdiction to hear the application under Section 34 of the Act. It is
impugned.
4. Learned counsel for the petitioner would submit that in the
agreement, as such, no seat has been defined. Only place of
arbitration has been given. Therefore, the application under Section
34 of the Act is maintainable in the court at Haldwani, because the
part of cause of action has occurred within the local jurisdiction of
the court.
5. There is one clause in the agreement with regard to place of
arbitration. It is clause no.25.7. It reads as follows:-
“25.7 Place of Arbitration: The place of arbitration shall
preferably be as mentioned in Schedule F. However, the
Arbitral Tribunal may decide the place in consultation with
both the parties.”
6. A reading of the above clause makes it clear that the place
of arbitration may be decided by the Arbitral Tribunal in
consultation with both the parties.
7. In Para 7 of the award, the arbitrator records that the seat
of arbitration is Delhi NCR. This Para 7 reads as follows:-
“II Place of Arbitration:
7. During the preliminary hearing held on 18th Oct. 2022, with
the consent of both the parties, it was decided that the place of
Arbitration in terms of section 20 of the Arbitration and
Conciliation Act, 1996 will be “”Delhi NCR”. The Seat of
Arbitration is therefore “Delhi NCR”.”
8. In the case of BGS SGS Soma JV Vs. NHPC Limited, (2020)
4 SCC 234, this aspect has been extensively examined by the
Hon’ble Supreme Court, and the law has been settled in Para 18 of
it, which reads as follows:-
“82. On a conspectus of the aforesaid judgments, it may be
concluded that whenever there is the designation of a place of
arbitration in an arbitration clause as being the “venue” of the
arbitration proceedings, the expression “arbitration proceedings”
would make it clear that the “venue” is really the “seat” of the
arbitral proceedings, as the aforesaid expression does not include
just one or more individual or particular hearing, but the
arbitration proceedings as a whole, including the making of an
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award at that place. This language has to be contrasted with
language such as “tribunals are to meet or have witnesses,
experts or the parties” where only hearings are to take place in
the “venue”, which may lead to the conclusion, other things being
equal, that the venue so stated is not the “seat” of arbitral
proceedings, but only a convenient place of meeting. Further, the
fact that the arbitral proceedings “shall be held” at a particular
venue would also indicate that the parties intended to anchor
arbitral proceedings to a particular place, signifying thereby, that
that place is the seat of the arbitral proceedings. This, coupled
with there being no other significant contrary indicia that the
stated venue is merely a “venue” and not the “seat” of the arbitral
proceedings, would then conclusively show that such a clause
designates a “seat” of the arbitral proceedings. In an
international context, if a supranational body of rules is to govern
the arbitration, this would further be an indicia that “the venue”,
so stated, would be the seat of the arbitral proceedings. In a
national context, this would be replaced by the Arbitration Act,
1996 as applying to the “stated venue”, which then becomes the
“seat” for the purposes of arbitration.”
9. In the instant case, the arbitrator has categorically, with
the consent of both the parties, determined the seat of arbitration,
and observed that it is Delhi NCR. In view of it, the court at
Haldwani, has no jurisdiction to entertain the application under
Section 34 of the Act. Accordingly, the impugned order does not
warrant any interference. Therefore, the writ petition deserves to be
dismissed at the stage of admission itself.
10. The writ petition is dismissed in limine.
(Ravindra Maithani, J.)
01.04.2025
Ravi Bisht