Case at a glance: The Supreme Court has held that where an arbitration clause names two places, Delhi and Goa, the seat must be found by reading the whole agreement, including the exclusive jurisdiction clause. Since that clause gave exclusive jurisdiction to Goa courts, Goa was the seat and Delhi only a venue, so the Delhi High Court had no jurisdiction to appoint an arbitrator.
A Franchise Agreement of August 2023 said in Clause 32.4 that “the precise location of the arbitration shall be within Delhi” and in Clause 32.5 that the proceedings “will be held in Goa”. Clause 38 applied Indian law and gave exclusive jurisdiction to the courts at Goa.
After a dispute, the Delhi High Court appointed an arbitrator under Section 11(6) of the Arbitration and Conciliation Act in November 2025. The appellant challenged its jurisdiction.
The Key Question Before the Court
When an arbitration clause mentions two places, how is the juridical seat identified, and did the Delhi High Court have jurisdiction?
Reading the Agreement as a Whole
The Court held that a venue does not automatically become the seat. Under BGS SGS SOMA and Arif Azim, a named place is the seat only where one place is named, proceedings are anchored there and there are no contrary indicia. Since Clause 32 named two places, that test failed.
Reading Clauses 32.4, 32.5 and 38 together, the agreement pointed to Goa. Following Swastik Gases, Brahmani River Pellets and Activitas, an exclusive jurisdiction clause can identify the seat and words like “exclusive” or “alone” are not essential. The argument that the arbitration clause should prevail independently was rejected, relying on Mankastu Impex.
What the Court Actually Held
- The appeal was allowed and the Delhi High Court's appointment order set aside.
- Goa is the juridical seat; Delhi is only a venue.
- Parties may approach the jurisdictional High Court.
Why This Judgment Matters
- It clarifies seat identification in poorly drafted clauses naming two places.
- It confirms that exclusive jurisdiction clauses can determine the seat.
- It warns parties that Section 11 petitions filed in the wrong court will fail.
What Should Advocates Take Away From the Judgment?
For Drafting Lawyers
- Name a single seat expressly and align the jurisdiction clause with it.
For Litigators
- Read the arbitration clause with the jurisdiction and governing law clauses before filing a Section 11 petition.
Key Takeaways
- Venue is not automatically the seat.
- Two named places require reading the whole agreement.
- Exclusive jurisdiction clauses can decide the seat.
- The Delhi appointment was set aside.
Frequently Asked Questions
Goa, because the exclusive jurisdiction clause pointed there.
The appointment order was set aside; parties may approach the jurisdictional High Court.
No. Following earlier cases, such words are not essential to identify an exclusive forum.
Conclusion
The ruling resolves a common drafting problem in commercial contracts.
Practical takeaway: Before filing under Section 11, check every clause bearing on seat and jurisdiction.