MULTIPLE SEATS OF ARBITRATION -ARBITRATION CLAUSE VOID OR NOT

Vedanta Limited v. Shreeji Shipping [Judgment dated February 8, 2024, in ARB.P.
342 of 2023]

In the present case, the Hon’ble Delhi High Court stated that if the parties intended
to choose multiple jurisdictions to govern the arbitration proceedings the same is
valid and the arbitration clause is not hit by Section 29 of the Indian Contract Act
(Section 29 of ICA “Agreements, the meaning of which is not certain, or capable of
being made certain, are void.”)
The Hon’ble Delhi High Court in deciding the present case relied on the judgment of
the Hon’ble Supreme Court in Indus Mobile Distribution (P) Ltd. v. Datawind
Innovations (P) Ltd., (2017) 7 SCC 678:
“19. 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 makes it
clear that jurisdiction exclusively 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 Sections 16 to 21 of 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.”
The Hon’ble Delhi High Court Further held that the provisions of Sections 16 to 20 of
CPC should not be applied for determining which of the Courts has jurisdiction, as
the law, in this case, is already settled by the above paragraphs of the judgment of
the Hon’ble Supreme Court.
In case the seat of arbitration is at three places, the parties are at liberty to approach
any one of the said three places.