02/07/2022, 17:12 Place Of Residence Of The Arbitrator Would Not Be The Seat Of Arbitration: Telangana High Court

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NEWS UPDATES

Place Of Residence Of The Arbitrator Would

Not Be The Seat Of Arbitration: Telangana
High Court
Ausaf Ayyub 25 June 2022 6:30 PM

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02/07/2022, 17:12 Place Of Residence Of The Arbitrator Would Not Be The Seat Of Arbitration: Telangana High Court

The High Court of Telangana has held that the place of residence of the arbitrator

would not determine the seat of arbitration.

The Single Bench of Justice P. Sree Sudha held that merely because an arbitrator

residing in Hyderabad has been appointed, it would not mean that only the Courts at

Hyderabad would have the jurisdiction to decide all the matters arising out of

arbitration agreement.

Also Read - Sale Of Corporate Debtor As A 'Going Concern' Includes Both Assets

And Liabilities: NCLT Mumbai

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Facts

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02/07/2022, 17:12 Place Of Residence Of The Arbitrator Would Not Be The Seat Of Arbitration: Telangana High Court

After a dispute arose between the parties, the respondent sent a letter to the petitioner

nominating an arbitrator who was residing in Hyderabad. The petitioner replied to its

said notice and declined to appoint the arbitrator for the reason that there was no

dispute which required the appointment of an arbitrator.

Accordingly, the respondent filed a Suit before the VII Additional District Judge

Sangareddy for relief of permanent injunction. Therein the petitioner filed an

application under Section 8 of the A&C Act and the parties were referred to arbitration.

Also Read - Does Police's Failure To Communicate Full Criminal Antecedents Of

Accused Amounts To Misconduct, Interference With Justice? MP High Court Seeks

DGP's...

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Thereafter, the respondent filed an application under Section 9 of the A&C Act before

the Principal District Judge, Sangareddy. Consequently, the petitioner filed the transfer

petition to transfer the application from the Court at Sangareddy to Court at

Hyderabad.

Contention Of The Parties

The petitioner sought the transfer of application on the following grounds:

• The respondent had nominated an arbitrator residing in Hyderabad, therefore,

only the Courts in Hyderabad would have the jurisdiction to decide all the matters
arising out of the arbitration.

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02/07/2022, 17:12 Place Of Residence Of The Arbitrator Would Not Be The Seat Of Arbitration: Telangana High Court

• The nomination of an arbitrator residing in Hyderabad amounted to

designating Hyderabad as the Seat of Arbitration.

Also Read - Karnataka High Court Monthly Digest: June 2022 [Citations 180 - 239]

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The respondent countered the submission of the petitioner on the following grounds:

• The petitioner had filed a Section 8 application before the Court at

Sangareddy, therefore, in terms of Section 42 of the A&C Act, only the court at
Sangareddy would have the jurisdiction to decide all the matters arising out of
arbitration.

Analysis By The Court

The Court held that the place of residence of the arbitrator would not determine the

seat of arbitration.

Also Read - Extended Period Of Limitation Can Be Invoked Only When 'Suppression

Of Facts' Is Wilful To Evade Tax :CESTAT

The Court rejected the argument of the petitioner that since the respondent had

initially nominated an arbitrator residing in Hyderabad, the Court at Hyderabad would

have the jurisdiction.

The Court held that merely because a party has nominated an arbitrator who resides in

Hyderabad, the same would not designate Hyderabad as the Seat of arbitration in

absence of any designation of the seat under the arbitration agreement.

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02/07/2022, 17:12 Place Of Residence Of The Arbitrator Would Not Be The Seat Of Arbitration: Telangana High Court

The Court further held that the petitioner had filed a Section 8 application before the

Court at Sangareddy consequent to which the parties were referred to arbitration.

Therefore, in terms of Section 42 of the A&C Act only that Court would have the

jurisdiction.

Accordingly, the Court dismissed the Transfer Petition.

Case Title: M/s S. Square Infra v. Garneni Chalapathi Rao, Transfer Civil

Miscellaneous Petition No. 122 of 2022

Date: 21.06.2022

Counsel for the Petitioner: Y Balaji

Counsel for the Respondent: S Sridhar

Click Here To Read/Download Order

TAGS TELANGANA HIGH COURT  SECTION 9 OF THE A&C ACT  SEAT OF ARBITRATION 

ARBITRATOR 

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