MANU/MH/0161/2020

Equivalent Citation: 2020(2)ABR386

IN THE HIGH COURT OF BOMBAY

Commercial Arbitration Petition No. 1315 of 2019
Decided On: 31.01.2020
Appellants: L&T Finance Ltd.
Vs.
Respondent: Manoj Pathak and Ors.
Hon'ble Judges/Coram:
G.S. Patel, J.
Counsels:
For Appellant/Petitioner/Plaintiff: Akash Rebello, Nadeem Shama, Hubab Sayyed and
Salman Athania i/b Triumph Legal
For Respondents/Defendant: Ashish Kamat and Kunal Mehta i/b Neeta Parekh
Case Note:
Arbitration - Jurisdiction - Section 9 of Arbitration and Conciliation Act
1996 - Present petition under Section 9 of Act 1996 seeking interim
protective orders against guarantors for repayment of a principal debtor's
dues - Whether present Arbitration petition is liable to be dismissed on
ground of jurisdiction - Held, it is not possible to read 'such other place' in
latter portion of clause as meaning some place other than one chosen by
Appellant in its sole discretion - In a domestic arbitration, a named venue is
seat of arbitration unless there is something to indicate that place is a
'mere venue' - Moreover, jurisdiction will be determined by location or situs
of seat - In present case we have venue regarded as seat, only Courts at
New Delhi would have jurisdiction and not any other Court - Thus, present
Court has no jurisdiction - Hence, present Arbitration petition is dismissed
on ground of jurisdiction - Petition dismissed. [30], [32]
JUDGMENT
G.S. Patel, J.
1 . This order, by consent, and at the specific request of Mr. Rebello for the
Petitioners, made on instructions he received, addresses only one of the two
preliminary objections raised by the Respondents. The Petition itself is under Section
9 of the Arbitration and Conciliation Act 1996. It is the usual Petition by a NBFC
seeking interim protective orders pending arbitration against two persons, Manoj
Pathak and Vinod Chaturvedi, both said to be guarantors for the repayment of a
principal debtor's dues. We are not concerned with the principal debtor, Usher Agro
Limited ("Usher Agro").
2. In February 2010, Usher Agro sought a loan of about Rs. 35 crores for a capacity
expansion project in Uttar Pradesh from Axis Bank. Usher Agro entered into a
Security Trustee Agreement dated 13th July 2012 with IDBI Trusteeship Services
Limited ("ITSL"). This will become important shortly. In parallel the Petitioner, L & T
Finance Limited ("L & T Finance") sanctioned a term loan to Usher Agro in the
amount of Rs. 22,59,49,410/-. It did not actually disburse this amount. Instead, on

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10th October 2013 there was a Deed of Assignment between Axis Bank and L & T
Finance for the loan amount of Rs. 22,59,49,410/-. Then there was an Addendum No.
1 to the Term Loan Agreement of 15th October 2013 by which Axis Bank, L & T
Finance and Usher Agro made the terms and conditions of the original Loan
Agreement applicable to the assigned loan i.e. the loan assigned to L & T Finance.
The period of repayment of this assigned loan was 13 quarterly instalments at a
floating interest rate of 13.25t per annum. Pathak and Chaturvedi issued two Deeds
of Guarantees dated 15th October 2013. We will not be concerned with these because
it is common ground that these guarantees were substituted by a later document
jointly executed by Pathak and Chaturvedi.
3 . In August 2014, there was a Working Capital Consortium Agreement dated 23rd
August 2014. The Parties to this were Usher Agro, Axis Bank, ITSL and various other
banks. L & T Finance does not seem to have been a party of this Consortium
Agreement. At least paragraph 11 of the Petition does not say so clearly. Under this
arrangement, Usher Agro took additional term loans and working capital facilities. It
executed a Deed of Accession to the Security Trustee Agreement with ITSL (of 13th
July 2012). The securities created by Usher Agro were extended to ITSL and,
according to L & T Finance, this extension was for the benefit of the L & T Finance.
There was also security in favour of L & T Finance under the Term Loan Agreement of
15th October 2013. The security cover is a charge on the movable and immovable
assets, present and future, as also current assets.
4 . Then there was an Inter Se Agreement dated 23rd August 2014. Again several
financial institutions were party to this. There is said to be additional security but
again I am not concerned with this. There followed on that day a Security Trustee
Agreement to which ITSL was a party. I will pass over some of the intervening
documents because they do not make a material difference. What matters is that on
23rd August 2014, Pathak and Chaturvedi, the two Respondents, jointly issued or got
issued a single substituted guarantee. It is agreed that this guarantee of 23rd August
2014 (jointly issued by Pathak and Chaturvedi) was in substitution of the previous
personal guarantees.
5. A copy of this guarantee in a more legible retyped version is from pages 226A to
226AB. This guarantee itself has an arbitration clause 43 with sub-clauses from (a) to
(t). This is how it reads:
"43. CLAUSE SPECIFIC TO L & T
Arbitration:
In case of a dispute with regard to any claim or right of L & T against the
Borrower/Guarantor, the same shall be referred to arbitration under the
Arbitration and Conciliation Act, 1996 ("Arbitration Act") and it is agreed by
all the Parties that:
(a) claims, disputes or rights, of L & T against the
Borrower/Guarantor may be adjudicated by L & T through arbitration
as provided hereinafter. All/any disputes or differences between the
Borrower/Guarantor as provided hereunder may be referred to
arbitration under the provisions of the Arbitration and Conciliation
Act, 1996.
(b) Such disputes or differences shall be adjudicated by a sole
arbitrator to be appointed by L & T, in accordance with the
provisions of the Arbitration and Conciliation Act, 1996, and rules

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 framed there under and any amendments thereto from time to time.
(c) It is agreed between the Borrower and L & T that nothing
contained in Section 17 of Arbitration and Conciliation Act, 1996,
shall in any way, affect the right of, or preclude L & T to/from
seek/seeking such interim reliefs under Section 9 of the Arbitration
and Conciliation Act, 1996, and the rules framed thereunder.
(d) The award of the arbitrator shall be a speaking award and shall
be final, conclusive and binding on all the parties to the arbitration
whether on question of law or fact.
(e) In the event of death, refusal, negligence, inability, incapability
of the person so appointed to act as the sole arbitrator, a new shall
be appointed by L & T.
(f) The venue of arbitration shall be New Delhi or such other
place as may be determined by L & T in its sole discretion
and courts in New Delhi or such other place shall have
exclusive jurisdiction.
(g) In the event the legal status of L & T changes or in the event of
the law being made or amended so as to bring L & T under the
Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act 2002 ("Securitization Act")
or the Recovery of Debts Due to Banks and Financial Institutions Act,
1993 ("DRT Act") to enable L & T to cause enforcement of the
Security under the Securitization Act or proceed to recover dues from
the Borrower/Guarantor under the DRT Act, the arbitration provisions
hereinbefore contained shall, at the option of L & T, cease to have
any effect and if arbitration proceedings are commenced but no
award is made, then at the option of L & T such proceedings shall
stand terminated and the mandate of the arbitrator shall come to an
end from the date of the making of the law or the date when
amendment becomes effective or the date when L & T exercises the
option of terminating the mandate of arbitrator, as the case may be.
(h) The Guarantors agree, confirm and covenant that the Guarantors
shall not object to claims arising out of the out standings of L & T
covered by this section between L & T and the Guarantors, alone
being adjudicated by the sole arbitrator in terms of this section, on
any grounds including the ground that the claim/s of the other
lenders (as defined in the Security Trustee Agreement) against the
Guarantors is/are to be adjudicated in any other appropriate
forum/court/authority/tribunal.
(i) The Guarantors agree, confirm and covenant that the Guarantors
shall not dispute the validity of the reference or the award on the
ground that the other Lenders are not parties to the reference or the
award.
(j) The Guarantors expressly agree that they shall not contend that L
& has given up its rights on the Security by reason of L & T making a
reference to the arbitration for its monetary claim only and accepts
its share in the net sale proceeds from the Security Trustee. It is
agreed that in the event of the other Lenders ceasing to have any

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 interest in the securities, the arbitrator shall have power to grant
reliefs in respect of the securities including realization thereof in
favour of L & T and such claim shall be deemed to have been issued
by arbitration agreement mentioned in 20(a) above.
(k) The Guarantors agree and covenant that the Guarantors shall not
raise the fact of notices invoking arbitration or reference to or
pendency of arbitration proceedings, as a ground of
objection/defence in any appropriate forum/court/authority tribunal
in respect of claims between the other Lenders and the Guarantors or
when action is taken by them or by the Security Trustee in respect of
the claim of the other Lenders.
(l) The Security Trustee/Guarantors shall recognize the monetary
claim of L & T to the extent shown by the Security Trustee in the
final statement of account evidencing the total claim due to the
entire body of Lenders, as being the amount due and payable by the
Guarantors to L & T, or to the extent awarded by the arbitrator,
under the award, as the case may be, as secured on the security
assets of the Guarantors. L & T's claim out of the secured assets and
the distribution of the net sale proceeds shall be governed pursuant
to the provisions of the Memorandum of Confirmation of Security
Ranking Arrangement between all the Lenders.
(m) The Security Trustee shall, at the time of distribution to the
other Lenders of the proceeds realized from the Security, on a pro
rata basis make payments to L & T together with the other Lenders.
In the event the Security Trustee is injuncted from making such
payment pursuant to an order of a court or competent jurisdiction,
then, the Security Trustee shall hold such portion of L & T's share
realized from the Security Interest, in trust for L & T upon the
injunction being vacated or under the award, whichever is earlier, or
otherwise and shall not deal with the same and in prejudicial manner
whatsoever.
(n) The Security Trustee shall not insist for any further
directions/orders from any court/tribunal for enabling the Security
Trustee to act upon the said award.
(o) After realization and pro-rata distribution by the Security Trustee
to all other Lenders, in the event of a shortfall, it is agreed between
the Parties that the Lenders shall be entitled to institute appropriate
recovery proceedings with respect to the shortfall as provided under
the terms of Finance Documents and/or law as may be applicable to
the Parties hereto.
(p) The Guarantors agree and covenant with the Security Trustee
that the Guarantors shall not raise or cause to be raised objections
of any nature whatsoever regarding enforcement of the claim of L &
T and/or the other Lenders against the Security and/or distribution
therefrom in the manner as agreed by and between all the Lenders
inter se.
(q) It is understood and agreed by L & T that such reference to
arbitration, shall at all times, subject to the provisions hereunder, be
without prejudice to the interest of the other Lenders and the right

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 and/or remedies of the other Lenders. L & T as the case may be shall
inform the Security Trustee before entering into reference for
arbitration.
(r) The Borrower hereby indemnifies and agrees to keep indemnified
the Security Trustee/L & T or any of them of, from and against all
costs including actual legal costs, charges and expenses that the
Security Trustee/L & T or any of them shall incur as a consequence
of invocation/enforcement of its rights in the manner as provided
herein.
(s) In the event that the dues of the other Lenders excluding L & T
have been repaid and/or settled by the Guarantors without the
Security Trustee/other Lenders having to enforce the Security, in that
event L & T shall be entitled to enforce its rights over the Security
before the arbitral tribunal or any other court or forum towards
recovery of its outstanding under the Finance Documents.
(t) It is agreed that in the aforesaid event, the Security Trustee shall
notwithstanding the other Lenders having agreed to or having
released the Security pertaining to their rights, shall continue to hold
the entire Security for and on behalf of L & T till the same is realized
and the net sale proceeds are handed over to L & T towards
satisfaction of its claims and further, the Security Trustee shall be
bound by the arbitration process and will be a party to any
proceedings that may be adopted by L & T against the Borrower.
The Guarantors agree and confirm that the reference to "dispute" in the
above Clause 43 pertains to any disputes arising between the L & T and the
Guarantors only."
(Emphasis added)
6. Before I look at the objections taken, one further point is to be noted which is the
framing of the document itself at page 226C where it begins. Both Pathak and
Chaturvedi are named. They are the guarantors. The guarantee is expressly said to be
in favour of ITSL, IDBI Trusteeships Services Limited. L & T Finance is not a named
party to the document at all. It is not a signatory to the document.
7. However clause 43 is, as we have seen, said to be "specific to L & T Finance". Now
this caption, and sub-clause (f) (emphasized above) lie at the heart of the objection
taken by Mr. Kamat for the Respondents.
8. The first objection is as to jurisdiction and is based on a reading of clause (f). The
second objection is that since L & T Finance is not a signatory to the document, nor a
party that can be fairly said to be a party named in the document (in the sense that
the guarantee is not given directly or explicitly 'in favour of' L & T Finance), therefore
there is no arbitration agreement as between the Respondent and L & T Finance at
all.
9 . Mr. Rebello's request is this. He seeks that I should address myself to the
jurisdictional issue or objection based on sub-clause (f), but should only turn to the
question of the existence of the Arbitration Agreement if I find in his favour on the
jurisdictional question, i.e. only if I hold that this Court does have jurisdiction.
Should I hold against him on jurisdiction and conclude that this Court lacks the
necessary jurisdiction, then he seeks that all contentions as to the existence of the

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Arbitration Agreement be kept open and left at large. The reason for making this
submission is that in that scenario (in which Mr. Rebello fails the jurisdictional test)
he will at least be entitled to approach a Court of otherwise competent jurisdiction
where he may address any objection as to the existence of the Arbitration Agreement.
I think this is both fair and reasonable and Mr. Kamat on behalf of the Respondents
has absolutely no objection. From another perspective, I think Mr. Rebello has quite
wisely chosen this course because should I be inclined to hold against him on both
aspects of the matter then there could conceivably be a situation where he is left
entirely without a Court to which he can go.
1 0 . I have granted Mr. Rebello's request. I have addressed the question of
jurisdiction first. I have, for the reasons that follow, held against him, and found that
this Court does not have jurisdiction. I have, therefore, not addressed the other
objections as to the existence of the arbitration agreement, and left all contentions
open in that regard.
11. For clarity I will now reproduce clause (f) again.
(f) The venue of arbitration shall be New Delhi or such other place as may be
determined by L & T in its sole discretion and courts in New Delhi or such
other place shall have exclusive jurisdiction.
12. The opposition from Mr. Kamat is that this clause has two distinct elements. First
there is an unequivocal nomination by the parties of a venue of choice, i.e. New
Delhi, and that the Courts in New Delhi have exclusive jurisdiction. Second, his
submission is that to the extent that the clause purports to grant a unilateral
overriding discretion to L & T Finance to choose 'any other place' as a venue and says
that 'such other place' (being the place nominated by L & T Finance) to be the
jurisdictional hub, the clause must fail because the Supreme Court has now clearly
said that considerations under Section 20 of the Arbitration Act and the demands of
party autonomy, neutrality and even handedness do not permit one party to dictate
terms and unilaterally foist its choice or decision on the other. Whether it is a matter
of appointment of an arbitral tribunal or, as in this case, a selection of a seat/venue
and Court jurisdiction, one party to the dispute cannot lay down the terms and
impose these on the other.
13. The third limb to this argument is that the distinction in domestic arbitrations
between seat and venue is now all but obliterated. He cites a certain amount of
precedent to support this, and I will turn to that presently.
14. I now note how Mr. Rebello fashions his submissions and how he commends I
approach the clause in question. He, too, seeks to parse the clause into two
component parts, but quite differently from Mr. Kamat's formulation. To ensure that
there is no ambiguity about my understanding of his submission, I will reproduce this
clause for a third time, this time with some internal numbering:
(f) (i) The venue of arbitration shall be New Delhi or such other place as may
be determined by L & T in its sole discretion, and
(ii) courts in New Delhi or such other place shall have exclusive jurisdiction.
15. Mr. Rebello's submission is that assuming (i) suffers from any legal infirmity, it
has no bearing at all on (ii). The second part of the clause does not confer exclusive
jurisdiction, and, necessarily this implies that it is not the venue or the seat that will
determine a Court's jurisdiction, but, rather, the traditional cause of action or Section
20 Code of Civil Procedure 1908 ("CPC") concept. It is not his submission that the

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entire clause from start to finish is invalidated but that it is the second portion of the
clause that is determinative of a Court's jurisdiction. If there is any ambiguity or
jurisprudential prohibition on discretion being vested in one party and such discretion
being unilaterally exercised, then the second limb of the clause must begin to
operate.
16. Yet another look at the clause in question is necessary to see if Mr. Rebello's
formulation is entirely accurate. I think it is not. sub-clause (f) divides itself not into
two parts, as Mr. Rebello suggests, but into four. The two parts in Mr. Rebello's
interpretation is each divisible into two subsidiary parts. The first, regarding venue
(the part shown as (i) above) has at its forefront the nomination or designation of a
specified venue, New Delhi. The subsidiary part of (i) then confers discretion on L &
T Finance to pick such other venue as it deems fit. Then comes the jurisdictional part
to which Mr. Rebello refers. But this again has two sub-components, New Delhi, and-
-this is important--such other place.
17. In other words, fully dissected, the clause would read thus:
(f) (i) The venue of arbitration shall be
(a) New Delhi or
(b) such other place as may be determined by L & T in its sole
discretion, and
(ii) courts in
(a) New Delhi or
(b) such other place
shall have exclusive jurisdiction.
18. Everything turns on how we approach this expression 'such other place' in (f)(ii)
(b) above. Mr. Rebello's submission is that the second occurrence of 'such other
place' means another place that has a cause of action based jurisdiction. I do not
think this is a fair reading of that clause or that it can be so entirely divorced from
the discretionary part of the second portion of the first part (f)(i)(b) above. 'Such
other place' occurs in both subsidiary clauses and in both contexts i.e. regarding
venue and in regard to a Court's jurisdiction. For venue, it does not simply say 'such
other place'. That would make no sense. It says such other place as may be
determined by L & T Finance in its sole discretion. This confers on L & T Finance a
unilateral discretion to choose any other venue at will, whether or not the
Respondents agree. In its second occurrence, therefore, 'such other place' must be a
reference not to some cause of action based jurisdictional Court but to 'such other
place as L & T Finance in its sole discretion may' have previously determined, i.e. to
court with jurisdiction over 'such other' venue that L & T Finance in its sole discretion
chose. That is the only holistic and harmonious reading of the whole of sub-clause
(f). If we read it in that fashion, and I do believe there is no other way of reading it,
this brings us back full circle to L & T Finance being impermissibly conferred with a
unilateral discretion, but this time to unilaterally name the Court to which it will go
rather than going to the place chosen by the parties by agreement, New Delhi.
19. I do not think that it is possible to read 'such other place' in the latter portion of
the clause as meaning some place other than the one chosen by L & T Finance in its
sole discretion.

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2 0 . In approaching this, we must bear in mind that we are concerned with a
domestic arbitration. The settled law now is that in a domestic arbitration, a named
venue is the seat of the arbitration unless there is something to indicate that the
place is a 'mere venue' (where a tribunal may examine witnesses etc). If a venue is
specified, then absent a specific indication of it being merely a venue, it will
constitute the seat of the arbitration; and jurisdiction will be determined by the
location or situs of the seat. It is only if neither seat nor venue are specified that the
cause of action based jurisdiction concept can operate. Simply: venue is ordinarily
the seat and venue-seat determine jurisdiction, not vice-versa.
21. This is also the current position in law from the Supreme Court decision in Indus
Mobile Distribution Private Limited v. Datawind Innovations Private Limited And Ors.
MANU/SC/0456/2017 : (2017) 7 SCC 678 The second decision is BGS SGS Soma Jv
v. NHPC Ltd. MANU/SC/1715/2019 Both sides have, however, relied on paragraph 85
of BGS SGS. It reads thus:
"85. 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 he 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 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."
(Emphasis added)
2 2 . Mr. Rebello emphasizes the second portion of this, the passage shown in
underlining above, to say that there must be internal indicators showing that the
parties made a distinction i.e. they agreed that the stated venue is merely a venue
and not the seat of the arbitrator proceedings. I think Mr. Rebello is in error, and,
indeed, I believe that this paragraph, correctly read as a whole actually assists Mr.
Kamat and not Mr. Rebello. The opening portion seems to me indicate quite
unambiguously that whenever the word 'venue' is used in regard to domestic
arbitration proceedings, it is really an indication then that is to be seat of those
proceedings. The only exception is when a 'venue' is separately designated as a
meeting place of convenience.

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23. Incidentally, SGS BGS also addresses the question of how a judgment must be
read, that is to say not by plucking a sentence out of context from here or there, but
holistically and for what it actually decides. It is this that is said to be the 'ratio' of a
judgment.
24. But this only answers the first portion of the argument. Mr. Rebello's construct
proceeds on the footing that the whole of the selection of the seat (or venue=seat)
provision is rendered bad because of the discretion impermissibly conferred on L & T
Finance to choose some other place in its sole discretion. That is not so. All that this
means is that L & T Finance cannot pick any venue other than New Delhi, and that the
stated venue, New Delhi, will be the seat (since there is nothing to indicate that it is
a 'mere venue', a meeting place of convenience). Mr. Rebello may have been correct
had the clause simply said the venue of the arbitration will be at such place as L & T
Finance may in its sole discretion decide. That would have rendered the entire clause
void, and then there would be no designated venue/seat at all. Instead, in its current
form, the clause does name a venue. It does not say it is merely a venue or meeting
place of convenience. This venue, New Delhi, is therefore the seat. It then goes on to
give L & T Finance additional discretion to unilaterally select some other venue/seat.
What is bad and would be unacceptable is L & T Finance exercising its choice to pick
any other venue. This would not dislodge the consensus arrived at between the
parties designating New Delhi as the chosen venue.
2 5 . Once we see it like this, and once we have the settled law that in domestic
arbitrations where a venue is specified it connotes the seat unless there is a specific
indication to the contrary, then obviously no question of any other cause of action
jurisdiction can survive for the purposes of selecting the competent Court.
26. Mr. Rebello does attempt an argument that despite the law both in Indus Mobile
and BGS SGS, the provision under Section 2(1)(e)(i) in regard to a Court for
domestic arbitrations remains untouched. I do not believe that is correct either. In
fact if there is any doubt about this, this seems to be put to rest entirely in BGS SGS
which considered the law as it stood prior to the five Judge Bench decision in Bharat
Aluminium Co. (BALCO) v. Kaiser Aluminium Technical Service, MANU/SC/0722/2012
: (2012) 9 SCC 552 the position after that decision, the provisions of Section 20
("place of arbitration"), the important decision in Roger Shashoua v. Mukesh Sharma
(2009) EWHC 957 (Comm.) and the evolution of the law since then, including the
2015 amendment. BGS SGS provides us with an analysis of how the test for
determining where lies the seat of an arbitration (paragraphs 63 to 84). In paragraph
84 of BGS SGS, citing a very recent decision in Brahmani River Pellets Ltd. v.
Kamachi Industries Ltd., MANU/SC/0968/2019 the Supreme Court held:
"84. Most recently, in Brahmani Rivel Pellets (supra), this Court in a domestic
arbitration considered clause 18--which was the arbitration agreement
between the parties--and which stated that arbitration shall be under Indian
Arbitration and Conciliation Act, 1996, and the venue of arbitration shall be
Bhubaneswar. After citing several judgments of this Court and then referring
to Indus Mobile Distribution (supra), the Court held:
"18. Where the contract specifies the jurisdiction of the Court at a
particular place, only such court will have the jurisdiction to deal
with the matter and parties intended to exclude all other courts. In
the present case, the parties have agreed that the "venue" of
arbitration shall be at Bhubaneswar. Considering the
agreement of the parties having Bhubaneswar as the venue
of arbitration, the intention of the parties is to exclude all

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 other courts. As held in Swastik, non-use of words like "exclusive
Jurisdiction", "only", "exclusive", "alone" is not decisive and does
not make any material difference.
1 9 . When the parties have agreed to the have the "venue" of
arbitration at Bhubaneshwar, the Madras High Court erred in
assuming the jurisdiction under Section 11(6) of the Act. Since only
the Orissa High Court will have the jurisdiction to entertain the
petition filed under Section 11(6) of the Act, the impugned order is
liable to be set aside."
(Emphasis added)
27. Our present case falls squarely not only within BGS SGS but actually within the
frame of the discussion in Brahmani River Pellets. There again the parties agreed that
the venue of the arbitration would be at Bhubaneshwar. If we apply this to our case
and exclude the discretionary factor, as I believe we must, we are left with New Delhi
being the only venue that can fairly be said to be the one agreed on by the parties.
Once we have that venue and that venue is regarded as the seat, and since there are
no other indicia that it is only a meeting place of convenience, then on any fair
reading of these decisions, only the Courts at New Delhi that would have jurisdiction
and not any other Court.
2 8 . Mr. Rebello's construct really amounts to writing out of the clause every
reference to New Delhi, including as to nominated or agreed venue, or, in other
words, to rewriting the entire clause. That is impermissible.
2 9 . There emerges the following trifecta of propositions in regard to a domestic
arbitration:
(a) A stated venue is the seat of the arbitration unless there are clear
indicators that the place named is a mere venue, a meeting place of
convenience, and not the seat;
(b) Where there is an unqualified nomination of a seat (i.e. without
specifying the place as a mere venue), it is courts where that seat is situated
that would have exclusive jurisdiction; and
(c) It is only where no venue/seat is named (or where it is clear that the
named place is merely a place of convenience for meetings) that any other
consideration of jurisdiction may arise, such as cause of action.
3 0 . Viewed from this perspective, I do not believe I can accept Mr. Rebello's
submissions. I hold that this Court has no jurisdiction.
31. For the reasons set out above, the second objection raised by Mr. Kamat as to
the existence of an arbitration agreement is not addressed on merits. All contentions
are specifically kept open.
32. The Arbitration Petition is dismissed on this ground of jurisdiction.
33. Although this is in the Commercial Division, and therefore an order of costs is
mandatory, in the present case and having regard to the limited point on which this
decision is rendered, I make no order of costs.
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