Calcutta High Court
Lite Bite Foods Private Limited vs Airports Authority Of India on 30 April, 2026
Author: Shampa Sarkar
Bench: Shampa Sarkar
2026:CHC-OS:151
IN THE HIGH COURT AT CALCUTTA
COMMERCIAL DIVISION
ORIGINAL SIDE
BEFORE :-
THE HON'BLE JUSTICE SHAMPA SARKAR
A.P.COM No. 783 of 2025
Lite Bite Foods Private Limited
vs.
Airports Authority of India
For the Petitioner : Mr. Anirudh K. Gandhi. Adv.
Mr. Abhishek Kurian, Adv.
Mr. Tanay Agarwal, Adv.
Mr. Deepak Kripalani, Adv.
Mr. Harsh Agarwal, Adv.
For the Respondents : Mr. Rupak Ghosh, Adv.
Mr. Uttam Kr. Mandal, Adv.
Mrs. Maitree Roy, Adv.
Ms. Udita Mandal, Adv.
Reserved on : 16.04. 2026
Judgment pronounced on : 30.04.2026
Judgement uploaded on : 30.04.2026
Shampa Sarkar, J.
1. This is an application under Section 11 of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as the said Act). The
petitioner prays for appointment of an arbitrator in terms of Sub-
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Article 22.2 of the Concession Agreement dated September 14, 2018
which was executed between the petitioner and the respondent
(hereinafter referred to as the said agreement). According to the
petitioner, disputes arose between the parties out of the said
agreement on account of non-refund of an amount of Rs.
91,17,025.36/- which remained outstanding from the respondent. The
petitioner requested the respondent for refund of the excess amounts
which were adjusted by the respondent against the supplementary bill
and issuance of the No Dues Certificate. The respondent failed to take
steps and the petitioner invoked arbitration.
2. The factual background is that, pursuant to a Request For Proposal
(RFP) dated December 2, 2017 and letter of intent to award dated
January 16, 2018, a concession agreement was entered into between
the parties on September 14, 2018, to develop, market, set up,
operate, maintain and manage the food and beverage outlets at the
New Domestic Terminal Building T1, at Biju Pattanayak International
Airport (Bhubaneswar).
3. On the allegation of breach of the terms of the agreement by the
respondent, the petitioner issued a termination notice dated April 16,
2019, to the respondent and vacated the premises on August 13,
2019. At the relevant point of time, disputes arose between the parties
in relation to credit notes aggregating to a sum of Rs. 92,14,288.68/-
which were issued in favour of the petitioner, by the respondent for
erroneous charging of concession fee for the period between May 2018
and August 2019.
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4. It was alleged by the petitioner that the respondent had wrongfully
issued supplementary bill on May 14, 2020, thereby, depriving the
petitioner of its lawful dues including the credit notes. The petitioner
raised a dispute with regard to the supplementary bill, treating the
same to be invalid and without any basis. On the disputes which
arose and which could not be amicably resolved, the petitioner
involved the arbitration agreement.
5. The petitioner approached the High Court of Orissa at Cuttack for
appointment of an arbitrator. The petitioner raised a claim of Rs.
92,14,288.68 for refund of the credit notes and the respondent had a
counter claim of Rs. 33,60,548.34. The said application was disposed
of by appointing a former Judge of Supreme Court of India as the sole
arbitrator, to adjudicate the disputes between the parties. The award
was published on August 28, 2023. The learned arbitrator held that
there was no contractual sanction for raising the supplementary bill
in the month of May, 2020, after the petitioner/claimant had left the
premises of the Airport on August 13, 2019. The tribunal further held
that supplementary bill was raised by the respondent in disregard to
the contractual provisions and there was no factual basis for the
respondent to raise such supplementary bill for an amount of Rs.
2,04,79,518. The tribunal was of the view that the supplementary bill
had been raised to offset the credit notes issued by the respondent in
favour of the claimant/petitioner. Adjustment of the supplementary
bill against the credit notes was contrary to the contractual terms and
as such the respondent could not raise Rs. 33,60,548.34 as the
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balance outstanding by way of a counter claim. The tribunal held that
as a result of the aforementioned finding, the petitioner was entitled to
be paid the amount covered by the credit notes to the extent of Rs.
92,14,788.68 along with interest @ 8 % per annum from the date
when the credit notes were issued by the respondent, till the date of
payment.
6. Thus, it was contended by the petitioner that, when the
supplementary bill was adjudicated to be wholly without substance
and unsustainable, the respondent was under an obligation
not to appropriate any amount towards the supplementary bill and
also duty bound to refund any amount that was already adjusted
against the supplementary bill. The respondent’s counter-claim
towards the alleged outstanding payment of Rs. 33,60,548.34 in
relation to the supplementary bill was rejected. The supplementary
bill was for an amount of Rs. 2,04,79,518/-, and the respondent
claimed a sum of Rs. 33,60,548.34. Thus, it was apparent from the
above calculation that the respondent had adjusted the remaining Rs.
1,71,18,969.66/- from the amount payable to the petitioner against
the supplementary bill, which in terms of the award was liable to be
refunded. The petitioner contended that the respondent had adjusted
Rs. 1,71,18,969.66 in two parts. Rs. 80,01,944.30/- was adjusted
against the credit notes and Rs. 91,17,025.36/- was adjusted from
the balance available against the excess ad hoc payment made by the
petitioner. The respondent refunded Rs. 80,01,944.30. An amount of
Rs. 91,17,025.36 remained outstanding.
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7. Under such circumstances, the petitioner was constrained to invoke
the arbitration agreement, by issuing a notice dated March 26, 2025,
in terms of Article 22.2 of Concession Agreement, seeking reference of
the disputes which had arisen between the parties, to arbitration. The
notice was sent by courier as also by e-mail. It was submitted by Mr.
Gandhi, learned Advocate that, although, the arbitration clause
provided for appointment of a sole arbitrator by the respondent, in
view of the decisions of the Hon’ble Apex Court in Perkins Eastman
Architects DPC and Another vs. HSCC (India) Ltd. reported in
2019 SCC OnLine SC 1517 and Central Organisation for Railway
Electrification vs. ECI SPIC SMO MCML (JV) A Joint Venture
Company reported in 2024 SCC OnLine SC 3219, the law did not
permit unilateral appointment of the arbitrator.
8. In the notice invoking arbitration, the name of a learned Senior
Advocate was proposed and the respondent was requested to give
consent. The respondent sent an e-mail to the petitioner indicating
that the matter had been referred to the legal team for opinion. As,
more than 30 days elapsed from the date of receipt of the notice, this
application was filed.
9. Mr. Rupak Ghosh, learned Advocate for the respondent raised the
question of maintainability of the application on the ground of lack of
territorial jurisdiction. He submitted that the earlier application for
appointment of an arbitrator was filed by the petitioner in the High
Court of Orissa at Cuttack. Such application was entertained and the
arbitrator was appointed. Thus, the parties and especially the
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petitioner understood the jurisdiction over the subject matter of
arbitration, to be vested in the High Court of Orissa. Such
understanding of the petitioner was on the ground that the contract
was to be executed in the Airport at Bhubaneshwar. The participation
in the proceeding before the learned arbitrator, who was appointed by
the High Court of Orissa at Cuttack, amounted to waiver of the
jurisdiction of this court.
10. It was submitted by Mr. Ghosh that the concession agreement
recorded that the parties had agreed that the courts at Bhubaneswar
would have exclusive jurisdiction to deal with the disputes and
accordingly the petitioner approached the High Court of Orissa. The
Concession Agreement was between two corporate/commercial
entities, who deliberated, discussed and understood the contents of
the clauses of the agreement and on such understanding, the parties
agreed to reduce the clauses into writing. On the facts, it was
submitted that, pursuant to the award dated August 28, 2025, the
respondent had paid the amount directed by the arbitrator with
interest, which aggregated to Rs. 1,51,53,778/- and the said amount
was accepted by the petitioner without any objection. An internal mail
evidencing such payment was annexed to the affidavit-in-opposition
and referred to by Mr. Ghosh. The claim of the petitioner was false
and frivolous.
11. It was further contended that the petitioner had filed an
application under section 34 of the Arbitration Conciliation Act, 1996
for setting aside the award dated August 28, 2025, before the
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commercial Court at Rajarhat being Misc. Case (arbitration) No. 93 of
2023) and renumbered as Misc. Case (arbitration) No. 77 of 2024. The
petitioner could not invoke arbitration for further reference of the
claims arising out of the concession agreement, which was based on
the award, as the award was under challenge before a competent
court, at the instance of the petitioner.
12. The dispute between the parties had been finally decided by the
learned arbitrator and the dispute which was raised by the petitioner
was barred by the principles of res judicata as also constructive res
judicata. Claim No. 3 of the statement of claim of the earlier
proceeding would indicate that the petitioner had already prayed
before the learned arbitrator for refund of the credit notes raised by
the respondent. Claim No. 3 culminated into the award and the claim
related to realisation of credit notes worth Rs. 2,04,79,518/-. Issues
with regard to the supplementary bills were heard and the learned
arbitrator directed the respondent to refund the sum of Rs.
92,14,788.68 to the petitioner. Claim 3 was partially allowed. The
adjudication in respect of claim No. 3 was not challenged in the
application under section 34, instead the petitioner sought to raise a
further claim by issuing the notice invoking arbitration. The claim in
the present dispute was covered by the adjudication of claim No. 3 in
the earlier proceeding and the arbitrator had decided such issue in an
elaborate manner. The learned arbitrator did not deem it necessary to
pass further order with regard to refund of the amounts which had
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been claimed to be payable by the respondent. Parallel proceedings
could not be permitted in law.
13. According to the respondent, the entire amount as directed by
the learned arbitrator along with the interest had been paid and was
received by the petitioner without any objection or any protest. Thus,
Mr. Ghosh prayed for dismissal of the application, both on the
grounds of lack of jurisdiction to entertain the application and also on
the ground that all the disputes between the parties had been decided
by the learned arbitrator. Mr. Ghosh relied on the decision of the
Hon’ble Apex Court Ravi Ranjan Developers Pvt. Ltd. vs. Aditya
Kumar Chatterjee reported in 2022 SCC OnLine SC 568 in support
of the contention that the seat of arbitration and venue of arbitration
could not be used interchangeably in this case. The place of arbitral
proceeding could not be the basis to determine the seat. Kolkata was
the place of the meetings, but the jurisdiction was with the High Court
of Orissa. The intention of the parties to agree to a seat, should be
determined from the other Sub-Articles in the agreement and the
conduct of the parties.
14. Mr. Ghosh referred to Article 22 of the agreement which was the
dispute resolution clause. Special reference was made to Sub-Article
22.2.1 with regard to the agreement between the parties that the
venue of the arbitration shall be at CHQ, that is, the Regional
Headquarters, Eastern Region, Airports Authority of India, NSCBI
Airport. He further submitted that Sub-Article 25.1 under Article 25
dealt with the miscellaneous provisions. The parties agreed that
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courts at Bhubaneswar, Orissa shall have jurisdiction over matters
arising out of or relating to the agreement. In view of this contrary
indicia, venue i.e. Regional Head Quarters, Eastern Region NSCB1
could not be treated as the seat.
15. Thus, it was submitted that, the parties consented that courts
at Bhubaneswar, Orissa would have jurisdiction and the overall
governing jurisdiction would override sub-Article 22.2.1. Kolkata was
merely the place of the meetings and not the seat. The overall
jurisdiction of the courts at Bhubaneswar under Sub-Article 25.1,
would take precedence over Sub-Article 22.2.1. He further relied on
the decision of Virgo Softech Ltd. vs National Institute of
Electronics and Information Technology reported in 2018 SCC
Online Del 12723, on the point that, there was a difference between
seat and venue of arbitration. In the absence of an express agreement
with regard to the seat, the venue of arbitration under Sub-Article
22.2.1 could not be treated as a seat, especially because the parties
agreed that the courts at Bhubaneswar would have exclusive
jurisdiction. Samiah International Builders Ltd. vs Green View-II
Sahkari Awas Samiti Ltd. reported in 2025:AHC:70118-DB was
relied upon, also in support of the ratio that, the moment the seat was
designated, it was akin to an exclusive jurisdiction clause, but the
same principle did not apply to designation of venue.
16. Heard the learned Advocates for the respective parties. On issue
of lack of territorial jurisdiction of this Court to entertain the
application under Section 11, a brief appreciation of the background
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of the earlier proceeding is necessary. The petitioner filed an
application for appointment of an arbitrator before the High Court of
Orissa. The respondent filed a counter-affidavit, inter alia, stating that
the moment seat was designated, it conferred exclusive jurisdiction to
the seat at CHQ/ Concerned Regional Headquarters at Kolkata. The
arbitration clause would have a priority over other clauses and the
venue agreed to in terms of the arbitration clause would alone confer
exclusive jurisdiction to the court to appoint an arbitrator. Thus, the
respondent prayed for dismissal of the said application on the ground
of maintainability. Specific plea was that, the parties had agreed to
vest jurisdiction so far as it related to arbitration, at Kolkata and
jurisdiction of the courts at Bhubaneshwar, Odisha would be with
regard to matters other than arbitration. The relevant paragraphs of
the affidavit-in-opposition are quoted below:-
“7. With reference to paragraphs 4,5,6 and 7 of the said
petition save and except what are matters of admitted record
allegations to the contrary are denied. It is denied that there
had been any breach on the part of the respondent or that
the Petitioner had suffered any loss or damage on account of
any action on the part of the respondent or that the
respondent was unable to effectively or otherwise carry out
any of its operations as alleged or at all. It is denied that the
petitioner was constrained to terminate the said agreement
owing to any actions on the part of the respondent as alleged
or at all. It is further denied that there has been any breach
on the part of the respondent during the subsistence of the
said agreement or otherwise or that any act of the
respondent formed any basis of the termination by the
petitioner or that the termination by the petitioner was legal
as alleged or at all. The Respondent states that the Credit
Notes and the Supplementary Bill are of the same month
and year as alleged by the Petitioner which is said to be
fictitious bill and it was thus an erroneous charging for the
period of May 2018 to August 2019 which is 10 months after
their exit which cannot be raised at all. According to clause
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10.4.1 (Pg. 188 of Vol I, SOC) of the Concession Agreement
AAI is entitled to raise the bills within 10th of every month
and the bills were raised within their 7 years of the term not
beyond that. As per Concession Agreement clause 10.4.1
(Pg. 26 of Concession Agreement), clause 14.1.3 (Pg. 41 of
Concession Agreement) and clause 14.4 (Pg. 42 of the
Concession Agreement) the petitioner is duty bound to remit
the License fee, Space Rent and other Utility charges on
25th of day of the current month as per the concession
agreement, irrespective of the receipt of the bills from AAL.
Thus the Petitioner did not pay concession fee as per the
invoices raised on the Petitioner for the period 31.10.2018 to
13.08.2019 amounting to Rs. 33,60,548.34 along with
applicable GST on the said invoices and thus the
Respondent raised the amount in their Counter Claim.
8. With reference to paragraphs 8 of the said Petition, the
same is matter of record which forms part of the Arbitral
Award dated 28.08.2023.”
17. The order of the High Court of Orissa recorded that the only
objection raised by the respondent was that since Sub-Article 22.2.1
of the Concession Agreement specified the venue of arbitration to be in
the Regional Headquarter, Airports Authority of India (NSCBI Kolkata),
the High Court of Orissa lacked jurisdiction to appoint an arbitrator.
Under Article 25.1, the courts at Bhubaneshwar, Odisha would have
jurisdiction over other matters arising out of or relating to the
agreement. In BGS Soma JV vs. NHPC Limited reported in (2020) 4
SCC 234, the Hon’ble Supreme Court held that venue shall be
interpreted as seat and such venue and seat would determine the
jurisdiction of the High Court for adjudication of a proceeding under
Section 11(6) of the Arbitration and Conciliation Act, 1996. In the
absence of any contrary indication in the arbitration clause with
regard to the venue, in this case the venue shall be interchangeably
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read as seat. This ratio applies to the subject agreement. In
Bhahmani River Pellets Limited vs. Kamachi Industries Limited
reported in (2020) 5 SCC 462 the position was further clarified by the
Hon’ble Apex Court, as hereunder :-
“4. Clause 18 of the agreement between the parties contains an
arbitration clause which reads as under:
“18. Arbitration shall be under Indian Arbitration and
Conciliation Law, 1996 and the Venue of Arbitration shall be
Bhubaneswar.”
***
***
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 other courts. As held
in Swastik [Swastik Gases (P) Ltd. v. Indian Oil Corpn. Ltd., (2013)
9 SCC 32 : (2013) 4 SCC (Civ) 157] , non-use of words like
“exclusive jurisdiction”, “only”, “exclusive”, “alone” is not decisive
and does not make any material difference.
19. When the parties have agreed to have the “venue” of
arbitration at Bhubaneswar, the Madras High Court erred [Kamchi
Industries Ltd. v. Brahmin River Pellets Ltd., 2018 SCC OnLine Mad
13127] 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 [Kamchi Industries Ltd. v. Brahmin River Pellets
Ltd., 2018 SCC OnLine Mad 13127] is liable to be set aside.”
18. The relevant paragraphs of BGS Soma (supra) are quoted
below:-
“Tests for determination of “seat”
60. The judgments of the English courts have examined the
concept of the “juridical seat” of the arbitral proceedings, and
have laid down several important tests in order to determine
whether the “seat” of the arbitral proceedings has, in fact, been
indicated in the agreement between the parties. The judgment of
Cooke, J., in Shashoua [Shashoua v. Sharma, 2009 EWHC 957
(Comm) : (2009) 2 Lloyd’s Law Rep 376] , states:
“34. London arbitration is a well-known phenomenon which
is often chosen by foreign nationals with a different law, such as
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the law of New York, governing the substantive rights of the
parties. This is because of the legislative framework and
supervisory powers of the courts here which many parties are
keen to adopt. When therefore there is an express designation of
the arbitration venue as London and no designation of any
alternative place as the seat, combined with a supranational
body of rules governing the arbitration and no other significant
contrary indicia, the inexorable conclusion is, to my mind, that
London is the juridical seat and English Law the curial law. In
my judgment it is clear that either London has been designated
by the parties to the arbitration agreement as the seat of the
arbitration, or, having regard to the parties’ agreement and all
the relevant circumstances, it is the seat to be determined in
accordance with the final fall back provision of Section 3 of the
Arbitration Act.”
61. It will thus be seen that wherever there is an express
designation of a “venue”, and no designation of any alternative
place as the “seat”, combined with a supranational body of rules
governing the arbitration, and no other significant contrary
indicia, the inexorable conclusion is that the stated venue is
actually the juridical seat of the arbitral proceeding.
***
***
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 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
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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.”
19. In Balapreetham Guest House (P) Ltd. vs My preferred
Transformation and Hospitality (P) Ltd. reported in 2021 SCC
Online Mad 126, the High Court of Madras proceeded to hold that
when the parties agreed to have the proceeding at New Delhi, the seat
would be New Delhi. Consequently, the clause which provided that the
agreement shall be governed and interpreted in accordance with the
laws of India and the court at Chennai shall have exclusive
jurisdiction in all matters arising out of the agreement, would not be
applicable. A harmonious reading of the two clauses would indicate
that the parties had agreed that in case of cause of action arising from
the agreement, the courts of Chennai alone would have jurisdiction in
the event the parties abandoned to arbitrate the dispute, and filed a
civil suit.
20. In my opinion, the arbitration clause is a prior clause in the
concession agreement and the same should be given precedence over
Sub-Article 25.1. Secondly, Article 22.2 deals with Arbitration. The
venue of arbitration and the express language therein, indicate that
the parties consented to anchor the arbitral proceeding at the
Regional Headquarter NSCBI Airport, Kolkata. Here the venue should
be read as seat as there was no contrary indication. The overall
governing jurisdiction under sub-Article 25.1 related to proceedings
other than arbitration. The relevant Articles are quoted below:-
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“22.2. Arbitration22.2.1 Any dispute with financial implication above
Rs.7,00,000/- (Rupees seven lakhs, as provided in
clause 22.1.1, shall be finally decided by reference to
arbitration by a Sole Arbitrator to be appointed by the
tender approving authority as per AAI delegation of
Power in vogue. Such arbitration shall be subject to the
provisions of the Arbitration and Conciliation Act, 1996
and shallinclude amendments to or any re-enactments
thereof, as inforce from time to time. The venue of such
arbitration shall be CHQ/concerned RHQand the
language of arbitration proceedings shall be English.
The cost of arbitration shall be borne equally by both
the parties.
22.2.2. The Arbitrator shall make an award (the “Award”) for
each dispute and/or claim and shall give reasons for
the Award. Any award made in any arbitration held
pursuant to this Article 22 shall be final and binding on
the parties. For avoidance of doubt, the parties hereto
agree that the adjudication hereunder shall not be final
and binding until an appeal against such adjudication
has been decided by an appellate tribunal or judicial
court, as the case may be, or no such appeal has been
preferred within the time specified in the Applicable
Law.
25.1 Governing Law and Jurisdiction
This Agreement shall be construed and interpreted in
accordance with and governed by the laws in India, and
the courts at Ahmedabad shall have jurisdiction over
matters arising out of relating to this Agreement.”
21. The subject matter of arbitration is situated at Kolkata and this
Court has the jurisdiction to hear this application. The Sub-Article
22.2.1 will have precedence over the miscellaneous provision.
Moreover, the law provides that parties were entitled to decide on the
place of arbitration. The respondent interpreted the contract to mean
that NSCBI, Kolkata, was the seat and the application of the petitioner
in the High Court of Orissa was objected to on this ground. Such
objection was not overruled by the High Court. Instead, the
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appointment of the arbitrator by the High Court of Orissa was on
consent. Consent cannot confer jurisdiction, as the seat had already
been designated and the parties intended that the venue shall be the
seat. In Height Insurance Services Limited Vs. Reliance Nippon
Life Insurance Company Limited reported in 2023 SCC Online Cal
912, it was held as follows :-
“20. Certain features, however, can be gathered from the language
of the clause itself. Although Mumbai courts have been conferred
exclusive jurisdiction concerning the agreement, the arbitration
proceeding has been agreed to be held in its entirety at Kolkata, to
the exclusion of all other remedies of the parties. There is no
indication in Clause 15 that the reference to Kolkata would be for
one or several particular meetings only but applies in general to
the entire arbitration proceeding itself.
***
***
22. Thus, a comprehensive reading of the clause itself leaves no
ambiguity that there is no distinction between the ‘venue’ and
‘seat’ of arbitration. Insofar as arbitration is concerned, the same
shall be exclusively held in Kolkata, irrespective of all other
remedies available to the parties.
23. Secondly, the earlier part of the arbitration clause
contemplates disputes in all matters, including construction,
interpretation, etc., concerning the agreement to be governed by
the laws of India. Although the expression “exclusive jurisdiction”
has apparently been conferred on Mumbai courts, such
conferment exclusively pertains to the subject-matter of the
dispute, as opposed to that of the arbitration.
***
***
30. Once the parties have subjected themselves to the provisions
of the 1996 Act, the interplay of Sections 11 and 20 of the 1996
Act governs the arbitration proceeding. In fact, the particular
expression “to be held in……” was also used in the relevant
arbitration clause dealt with in BGS SGS Soma JV (supra). Aptly, it
was held by the Supreme Court that the inexorable conclusion in
such cases is that the stated venue is actually the juridical seat of
the arbitral proceeding.
***
***
33. Again, in Raman Deep (supra), the Delhi High Court proceeded
on an arbitration clause which clearly fixed the venue of the
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arbitration “for the convenience” to be the office of the Company.
Although the jurisdiction of all disputes were to be Delhi only, the
venue for arbitration proceedings was to be at Faridabad, Haryana.
Here, however, the term “venue” has not been used at all. Instead,
“shall be held” is the chosen expression in the present case.
***
***
38. Such decision cannot be said to be an exactly identical fit to
the present case, since in Clause 15 of the agreement at hand,
irrespective of the Mumbai courts having jurisdiction with regard
to the agreement, the arbitral proceedings were specifically
stipulated to be held at Kolkata. As such, even if the SLP was
dismissed against the said order of the Delhi High Court, the same
cannot have a direct bearing on the issue at hand in our case.
39. Insofar as the Ravi Ranjan Developers (supra) is concerned,
the general law was discussed, including the distinctions between
“seat” and “venue”, as contrasted with the “place” of arbitration.
Kolkata was held to be only the venue for sitting of the arbitral
tribunal, since “sitting of the said Arbitral Tribunal” was to be at
Kolkata. The expression ‘sitting’ cannot exactly be equated to the
unequivocal ‘shall be held’ used in the present case.
40. Thus, each of the said decisions were rendered in their
respective contexts, in the light of the language of the arbitration
clauses.
***
***
42. Hence, applying all the relevant yardsticks, the seat of
arbitration and, consequently, the subject-matter of the
arbitration, as opposed to that of the disputes, has been fixed at
Kolkata.”
22. In Indus Mobile Distribution Pvt. Ltd. vs Datawind
Innovations Pvt. Ltd. reported in (2017) 3 R.A.J. 682 (SC) it was
held as follows:-
“14) This Court reiterated that once the seat of arbitration has
been fixed, it would be in the nature of an exclusive jurisdiction
clause as to the courts which exercise supervisory powers over
the arbitration.
xxxxxxxxxxxxx
20) A conspectus of all the aforesaid provisions shows that the
moment the seat is designated, it is akin to an exclusive
jurisdiction clause. On the facts of the present case, it is clear
that the seat of arbitration is Mumbai and Clause 19 further
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makes it clear that jurisdiction exclusive vests in the Mumbai
courts. Under the Law of Arbitration, unlike the Code of Civil
Procedure which applies to suits filed in courts, a reference to
“seat” is a concept by which a neutral venue can be chosen by
the parties to an arbitration clause. The neutral venue may not
in the classical sense have jurisdiction–that is, no part of the
cause of action may have arisen at the neutral venue and
neither would any of the provisions of Section 16 to 21 of the
CPC be attracted. In arbitration law however, as has been held
above, the moment “seat” is determined, the fact that the seat is
at Mumbai would vest Mumbai courts with exclusive
jurisdiction for purposes of regulating arbitral proceedings
arising out of the agreement between the parties.
21) It is well settled that where more than one court has
jurisdiction, it is open for parties to exclude all other courts. For
an exhaustive analysis of the case law, see Swastik Gases
Private Limited v. Indian Oil Corporation Limited, (2013) 9 SCC
32 : 2013(4) R.A.J. 30. This was followed in a recent judgment
in B.E. Simoese Von Staraburg Niedenthal v. Chhattisgarh
Investment Limited, (2015) 12 SCC 225 : (2014) 6 R.A.J. 632.
Having regard to the above, it is clear that Mumbai courts alone
have jurisdiction to the exclusion of all other courts in the
country, as the juridical seat of arbitration is at Mumbai. This
being the case, the impugned judgment is set aside. The
injunction confirmed by the impugned judgment will continue
for a period of four weeks from the date of pronouncement of
this judgment, so that the respondents may take necessary
steps under Section 9 in the Mumbai Court. Appeals are
disposed of accordingly.”
23. The moment a seat was designated, it was akin to the exclusive
jurisdiction clause.
24. In Mr. Raman Deep Singh Taneja vs Crown Realtech Private
Limited reported in 2017 SCC Online Del 11966, it was held as
follows :-
“9. In the present case we are faced with the situation where
one part of the agreement provides for exclusive jurisdiction to
Courts of Delhi, while the other, due to the venue of arbitral
proceedings, vests exclusive jurisdiction in Courts in Faridabad,
State of Haryana. As was held by the Supreme Court in the
judgment of Bharat Aluminium Company (Supra), a distinction is
to be drawn between “Subject-Matter of the Arbitration” and
“Subject-Matter of the Suit”. For the purposes of identifying the
Court, which shall have supervisory control over the arbitral
192026:CHC-OS:151
proceedings, it would be the Court where the ‘Subject-Matter of
Arbitration’ is situated that would have precedence over the
Court where the “Subject-Matter of the Suit” is situated. In this
case, therefore, the exclusive jurisdiction conferred due to venue
of arbitration would take precedence over the exclusive
jurisdiction vested over the Subject-Matter of the suit in the
Courts at Delhi. There are various provisions in the Act where
the Court has to exercise supervisory jurisdiction over the
arbitration proceedings. These include not only Section 11 of
the Act but also Sections 14, 27, 29A, 34 and 37 of the Act. It is,
therefore, evident that the Court having jurisdiction over the
arbitration proceedings would have precedence over the Court
which has jurisdiction over the Subject-Matter of the suit or
where the cause of action has arisen. The purported conflict
between the two parts of Clause 24 quoted above can be
resolved by holding that where the disputes are to be
adjudicated without reference to the arbitration, Courts at Delhi
would have exclusive jurisdiction, however, where they have to
be resolved through arbitration, venue being at Faridabad,
Haryana, the Courts at Faridabad, State of Haryana, would
have exclusive jurisdiction.
10. In view of the above, the present petition is dismissed for
want of territorial jurisdiction with liberty to the petitioner to
approach the Court of competent jurisdiction in accordance
with law.”
25. In Vr. Surat Private Limited Through its authorized
signatory vs Amit Sinha reported in 2025 SCC Online Del 3992, a
similar situation had arisen, wherein the lease agreement provided for
both a governing jurisdiction of courts and dispute resolution clause.
The Delhi High Court held that:-
“7. In order to appreciate the aforesaid contentions, the Court
has considered clause 18.8 of the Lease Agreement, which reads
as under:–
“18.8 Governing Law and Dispute Resolution-
(a) The validity, construction and performance of this
Lease Deed shall be governed interpreted with laws of
India with competent Courts at Surat having the
exclusive jurisdiction in this regard.
(b) If any question of difference or claim or dispute shall
arise between the parties hereto touching these presents
202026:CHC-OS:151
or the construction thereof to rights, duties or obligations
of the parties hereto or as to any matter arising out of or
connected with the subject matter of these presents, the
same shall be referred to the arbitration to be held at
New Delhi in accordance with the provisions of the
(Indian) Arbitration and Conciliation Act, 1996. The
reference shall be to a sole arbitrator. If the Parties fail to
·appoint a sole arbitrator within 30 (Thirty) days, then
the dispute shall be referred to 3 (Three) arbitrators, with
each Party appointing 1 (One) arbitrator and the two
arbitrators so appointed appointing the third arbitrator.
The arbitrator/s shall render their award In English
language and in writing. The Parties agree to abide by
the decision of the arbitrator/s, which shall be final and
binding.”
8. A bare perusal of Clause 18.8(b) of the Lease Deed indicates
that any question with respect to difference, claim, or dispute
arising between the parties, touching upon the construction of
the Lease Deed or the rights, duties, or obligations of the
parties pursuant thereto, shall be referred to arbitration to
be held at New Delhi in accordance with the provisions of the
1996 Act.
9. The use of the expression “held at New Delhi” is of
fundamental significance. This Court, in the case of Cinepolis
India Pvt. Ltd. considered a similar clause wherein the
arbitration was stipulated to be “held” at a particular place,
and the objection raised was that the agreement was executed
at Ghaziabad and the property in question was also situated in
Ghaziabad.
***
***
11. Thus, notwithstanding the situs of the property or the
place of execution of the agreement, once the parties have
agreed to New Delhi as the venue or seat of arbitration, the
jurisdiction would lie with the Courts at New Delhi. The
relevant paragraphs of the said decision read as under:–
“29. What emerges therefore by reading of the various
judgments referred to above is that it is really the seat of
arbitration which is akin to an exclusive jurisdiction clause.
Where there are no contrary provisions in the agreement, the
place would be the juridical seat which would determine the
territorial jurisdiction of a Court. Where the words in the
arbitration clause are neither seat nor place and the
212026:CHC-OS:151
arbitration clause only refers to words such as “venue’ or
“held in” the intent of the parties would have to be seen from
the agreement. If the parties intend that the arbitration
proceedings are to be held as a whole at that particular
venue then the venue also becomes a juridical seat. It is also
clear from the now well settled law that it is the seat or the
juridical seat which will be the guiding factor for a Court to
determine its jurisdiction while examining a petition under
Section 11 of the Act.
30. In the case of Devyani International
Ltd. v. Siddhivinayak Builders & Developers being OMP (I)
(COMM) 373/2017, decided on 27.09.2017, a Coordinate
Bench of this Court was dealing with an inter-play between
an Arbitration Clause and a clause relating to “Governing
Law”. Relevant para of the Arbitration Clause is as under:
“22.1 ……The seat of arbitration shall be at New
Delhi”
Clause 12 which was a clause of the Governing Law
read as under : -“12.1… The Courts at Mumbai shall
have the exclusive jurisdiction to entertain the
dispute or suit arising out of or in relation to this
agreement.
The Court relied upon the judgment of the Supreme
Court in Indus Mobile Distribution Private
Limited (supra) and held that the agreement records
that the seat of Arbitration shall be at Delhi and thus
the Delhi Courts will have exclusive jurisdiction to
adjudicate the disputes between the parties
31. In the case of Ramandeep Singh Taneja v. Crown
Realtech Private Ltd. being Arb. P. 444/2017,
decided on 23.11.2017, the issue of territorial
jurisdiction arose on account of the fact that under
Arbitration Clause 24 of the agreement between the
parties, the jurisdiction of all disputes was at Delhi
while the venue for arbitration proceedings was
agreed to be at Faridabad, Haryana. A coordinate
Bench of this Court relying on Indus Mobile
Distribution Private Limited (supra)
and BALCO (supra), held that the place where the
venue of arbitration was located would take
precedence over the exclusive jurisdiction vested in
the Courts at Delhi. The judgment of the Supreme
Court in the case of BALCO (supra) was relied upon
wherein the Supreme Court held that a distinction is
to be drawn between “subject matter of the
arbitration” and “subject matter of the suit”. For the
purpose of identifying the Court which shall have
supervisory control over the Arbitral Proceedings, it
22
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would be the Court where the “subject matter of
arbitration” is situated and that would take
precedence over the Court where the “subject matter
of the suit” is situated.
32. The Coordinate Bench resolved the conflict
between the two parts of clause 24 by holding that
where the disputes are to be adjudicated without
reference to arbitration, Courts at Delhi would have
exclusive jurisdiction, however, where they have to
be resolved through arbitration, venue being at
Faridabad, Haryana, the Courts at Faridabad would
have exclusive jurisdiction. The same Bench
thereafter decided a petition under Section 11 of the
Act titled as Global Credit Capital Limited v. Krrish
Realty Nirman Pvt. Ltd. being Arb. P. 123/2018,
decided on 16.05.2018, where again the issue of
territorial jurisdiction of this Court arose. The said
case being Arb Pet. 123/2018 was decided on
16.05.2018 and allowed. The conflict was between
the Arbitration Clause 24 as per which the venue of
arbitration was Delhi and clause 31 of the
Collaboration Agreement, which provided that
“Courts at Gurgaon shall have jurisdiction of all
matters concerning this agreement”. The word
‘venue’ was construed by the Courts at ‘Seat” of
arbitration following the judgments of the Supreme
Court on the said issue. Reliance was then placed
on Indus Mobile Distribution Private Limited (supra)
and Ramandeep Singh Taneja (supra) and it was
held that the seat of arbitration being Delhi, the
Courts at Delhi would have the territorial jurisdiction
to decide matters concerning arbitration
33. Thus, applying the law laid down the arbitration
clause in the present case is clearly referring to a
juridical seat of arbitration and since the seat is
designated at New Delhi, this Court would have
jurisdiction to entertain the present petition, even
though cause of action may have arisen in
Ghaziabad”
26. Under such circumstances, the issue of lack of jurisdiction of
this Court is decided against the respondent. With regard to the other
contention that once the award has been challenged before the
commercial court at Rajarhat, the petitioner was barred by law to
raise a claim on the basis of the self-same award by invoking
232026:CHC-OS:151
arbitration, this court holds that, the nature and extent of claim No. 3in the earlier arbitral proceeding and what had been allowed or
disallowed, are questions of fact which require re-appreciation of the
award and weighing of evidence. Such exercise is beyond the
jurisdiction of the referral court.
27. Further, whether the present claims of the petitioner are barred
by the principles of issue estoppel, constructive res judicata or res
judicata or whether they were covered by claim No. 3 and the
adjudication thereof was complete, are also matters of evidence. The
arbitrator tribunal is the competent forum to decide such matter. With
regard to the further submission that the amount in terms of the
award along with the interest had been paid and the same had been
accepted by the petitioner without any protest, is an issue of accord
and satisfaction. Such issue should also be decided by the learned
arbitrator. The jurisdiction of a referral court is limited.
28. In the decision of SBI General Insurance Co. Ltd. vs Krish
Spinning reported in 2024 SCC Online SC 1754, the Hon’ble
Supreme Court held as follows:-
“92. The position that emerges from the aforesaid discussion of
law on the subject as undertaken by us can be summarised as
follows:–
vi. The decision in Vidya Drolia (supra) although adopted the
view taken in Mayawati Trading (supra) yet it provided that in
exceptional cases, where it was manifest that the claims
were exfacie time barred and deadwood, the Court could
interfere and refuse reference to arbitration. Recently, this view
in the context of “accord and satisfaction” was adopted
in NTPC v. SPML (supra) wherein the “eye of the needle” test
was elaborated. It permits the referral court to reject
242026:CHC-OS:151
arbitration in such exceptional cases where the plea of fraud or
coercion appears to be ex-facie frivolous and devoid of merit.
93. Thus, the position after the decisions in Mayavati
Trading (supra) and Vidya Drolia (supra) is that ordinarily, the
Court while acting in exercise of its powers under Section 11 of
the Act, 1996, will only look into the existence of the arbitration
agreement and would refuse arbitration only as a demurrer
when the claims are ex-facie frivolous and non-arbitrable.
iii. What is the effect of the decision of this Court in In Re :
Interplay Between Arbitration Agreements under the Arbitration
and Conciliation Act, 1966 and the Indian Stamp Act 1899 on
the scope of powers of the referral court under Section 11 of the
Act, 1996?
94. A seven-Judge Bench of this Court, in In Re : Interplay
Between Arbitration Agreements under the Arbitration and
Conciliation Act, 1966 and the Indian Stamp Act, 1899 reported
in 2023 INSC 1066, speaking eruditely through one of us, Dr
Dhananjaya Y. Chandrachud, Chief Justice of India, undertook
a comprehensive analysis of Sections 8 and 11 respectively of
the Act, 1996 and, inter alia, made poignant observations about
the nature of the power vested in the Courts insofar as the
aspect of appointment of arbitrator is concerned. Some of the
relevant observations made by this Court in In Re :
Interplay (supra) are extracted hereinbelow:
“179. […] However, the effect of the principle of competence-
competence is that the arbitral tribunal is vested with the power
and authority to determine its enforceability. The question of
enforceability survives, pending the curing of the defect which
renders the instrument inadmissible. By appointing a tribunal
or its members, this Court (or the High Courts, as the case may
be) is merely giving effect to the principle enshrined in Section
16. The appointment of an arbitral tribunal does not necessarily
mean that the agreement in which the arbitration clause is
contained as well as the arbitration agreement itself are
enforceable. The arbitral tribunal will answer precisely these
questions.
xxx xxx xxx
“129. Insofar as the first issue is concerned, we are of the opinion
that the observations made by us in Arif Azim (supra) do not
require any clarification and should be construed as explained
therein.
130. On the second issue it was observed by us in paragraph 67
that the referral courts, while exercising their powers under Section
11 of the Act, 1996, are under a duty to “prima-facie examine and
reject non -arbitrable or dead claims, so as to protect the other
party from being drawn into a time-consuming and costly
arbitration process.”
25
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131. Our findings on both the aforesaid Issues have been
summarised in paragraph 89 of the said decision thus:-
“89. Thus, from an exhaustive analysis of the position of law on the
issues, we are of the view that while considering the issue of
limitation in relation to petition under Section 11(6) of the Act,
1996, the courts should satisfy themselves on two aspects by
employing a two-pronged test – first, whether the petition under
Section 11(6) of the Act. 1996 is barred by limitation; and secondly,
whether the claims sought to be arbitrated are ex-facle dead claims
and are thus barred by limitation on the date of commencement of
arbitration proceedings. If either of these issues are answered
against the party seeking referral of disputes to arbitration. the
court may refuse to appoint an arbitral tribunal.”
132. Insofar as our observations on the second issue are
concerned, we clarify that the same were made in light of the
observations made by this Court in many of its previous decisions,
more particularly in Vidya Drolia (supra) and NTPC v. SPML
(supra). However, in the case at hand, as is evident from the
discussion in the preceding parts of this judgment, we have had
the benefit of reconsidering certain aspects of the two decisions
referred to above in the light of the pertinent observations made by
a seven-Judge Bench of this Court in In Re: Interplay (supra).
133. Thus, we clarify that while determining the issue of limitation
in exercise of the powers under Section 11(6) of the Act, 1996, the
referral court should limit its enquiry to examining whether Section
11 (6) application has been filed within the period of limitation of
three years or not. The date of commencement of limitation period
for this purpose shall have to be construed as per the decision in
Arif Azim (supra). As a natural corollary, it is further clarified that
the referral courts, at the stage of deciding an application for
appointment of arbitrator, must not conduct an intricate
evidentiary enquiry into the question whether the claims raised by
the applicant are time barred and should leave that question for
determination by the arbitrator. Such an approach gives true
meaning to the legislative intention underlying Section 11(6-A) of
the Act, and also to the view taken in In Re: Interplay (supra).”
29. In the decision of Interplay Between Arbitration Agreements
under Arbitration and Conciliation Act, 1996 and Stamp Act,
1899, In Re reported in (2024) 6 SCC 1, the Hon’ble Supreme Court
discussed the scope of interference by a referral court and held that
the referral court was entitled to cause a, prima facie, examination
26
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with regard to existence of an arbitration clause.. The relevant
paragraphs of Interplay (supra) are as follows :-
“114. In view of the observations made by this Court in In Re: Interplay
(supra), it is clear that the scope of enquiry at the stage of appointment
of arbitrator is limited to the scrutiny of prima facie existence of the
arbitration agreement, and nothing else. For this reason, we find it
difficult to hold that the observations made in Vidya Drolia (supra) and
adopted in NTPC v. SPML (supra) that the jurisdiction of the referral
court when dealing with the issue of “accord and satisfaction” under
Section 11 extends to weeding out ex-facie non-arbitrable and frivolous
disputes would continue to apply despite the subsequent decision in In
Re: Interplay (supra).
xxx xxx xxx
125. We are also of the view that ex-facie frivolity and dishonesty in
litigation is an aspect which the arbitral tribunal is equally, if not more,
capable to decide upon the appreciation of the evidence adduced by the
parties. We say so because the arbitral tribunal has the benefit of going
through all the relevant evidence and pleadings in much more detail
than the referral court. If the referral court is able to see the frivolity in
the litigation on the basis of bare minimum pleadings, then it would be
incorrect to doubt that the arbitral tribunal would not be able to arrive
at the same inference, most likely in the first few hearings itself, with
the benefit of extensive pleadings and evidentiary material.
xxxxxxxxxxxxx
166. The burden of proving the existence of arbitration agreement
generally lies on the party seeking to rely on such agreement. In
jurisdictions such as India, which accept the doctrine of competence-
competence, only prima facie proof of the existence of an arbitration
agreement must be adduced before the Referral Court. The Referral
Court is not the appropriate forum to conduct a mini-trial by allowing
the parties to adduce the evidence in regard to the existence or validity
of an arbitration agreement. The determination of the existence and
validity of an arbitration agreement on the basis of evidence ought to be
left to the Arbitral Tribunal. This position of law can also be gauged
from the plain language of the statute.
167. Section 11(6-A) uses the expression “examination of the existence
of an arbitration agreement”. The purport of using the word
“examination” connotes that the legislature intends that the Referral
Court has to inspect or scrutinise the dealings between the parties for
the existence of an arbitration agreement. Moreover, the expression
“examination” does not connote or imply a laborious or contested
inquiry. [P. Ramanatha Aiyar, The Law Lexicon (2nd Edn., 1997) 666.]
On the other hand, Section 16 provides that the Arbitral Tribunal can
“rule” on its jurisdiction, including the existence and validity of an
arbitration agreement. A “ruling” connotes adjudication of disputes after
admitting evidence from the parties. Therefore, it is evident that the
Referral Court is only required to examine the existence of
arbitration agreements, whereas the Arbitral Tribunal ought to
rule on its jurisdiction, including the issues pertaining to the
existence and validity of an arbitration agreement. A similar view
was adopted by this Court in Shin-Etsu Chemical Co. Ltd. v. Aksh
27
2026:CHC-OS:151
Optifibre Ltd. [Shin-Etsu Chemical Co. Ltd. v. Aksh Optifibre Ltd., (2005)
7 SCC 234]”
30. The application is allowed. The respondent is at liberty to raise
all points with regard to admissibility of the claim, jurisdiction of the
learned arbitrator, limitation, accord and satisfaction etc. before the
learned arbitrator.
31. The dispute is referred to the sole arbitrator. Mr. Deepan Kumar
Sarkar, (Mob. No. 8420473075), learned Advocate, Bar Library Club is
appointed as the learned Arbitrator.
32. The learned arbitrator shall apply provision of Section 12 of the
Arbitration and Conciliation Act. The learned arbitrator will fix his
own remuneration in accordance with the provisions of the schedule
of the Act.
33. Urgent Photostat certified copies of this judgment, if applied for,
be supplied to the parties upon fulfilment of requisite formalities.
(Shampa Sarkar J.)
