IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Arb. Case No. 113 of 2010 (O&M) Date of decision: 9.3.2011 M/s Alam Contractors & Engineers …..petitioner vs. State of Haryana and ors …..Respondents CORAM: - HON’BLE MR. JUSTICE HEMANT GUPTA Present: - Mr. Pritam Saini, Advocate for the petitioner Mr. P.S. Poonia, Addl. AG, Haryana for respondent No. 1. Mr. J. S. Ahluwalia, Advocate for respondent No. 2. Mr. Mohnish Sharma, Advocate for Mr. Narender Hooda, Advocate for respondents No. 3 and 4. HEMANT GUPTA, J Petitioner has invoked the jurisdiction of this Court for appointment of an Arbitrator under Section 11 of the Arbitration & Conciliation Act, 1996 (for short the ‘Act’) in respect of the dispute arising out of an agreement dated 24.11.2007. It is the case of the petitioner that the petitioner had completed the work granted as per the specifications but respondent No. 2 has not fulfilled his contractual obligation which resulted into huge extra Arb. Case No. 113 of 2010 (O&M) expenditure and losses to the applicant-petitioner. Such disputes are required to be adjudicated upon by an Arbitrator in terms of the agreement. On behalf of respondents, it has inter alia been pointed out that as per the terms of agreement, the parties have restricted the jurisdiction in respect of the dispute between them to be decided by Lucknow Court. It is further mentioned that respondent No. 2 has appointed Shri Tarun Prakash Srivastva, Advocate as an Arbitrator to decide the dispute vide its letter dated 4.8.2010 in terms of the Arbitration Clause of the Agreement, which . read as under: - J. Dispute Resolution In case of any dispute, all efforts shall be made to resolve the same amicably. However, if this is not possible, the same shall be referred to an arbitrator, appointed by the BUYER. Venue for resolution of any/all disputes shall be HQ of the BUYER at Lucknow, India. Learned counsel for the petitioner has vehemently argued that the said Clause of the Agreement does not oust the jurisdiction of this Court as the jurisdiction of the Lucknow was not made exclusive in the Agreement. Learned counsel for the petitioner has relied upon a Single Bench Judgment of the Delhi High Court reported as 2006(3) R.A. J. 524 (Del) Wipro Finance Ltd. Vs. Sand Plast (India) Ltd. Having heard learned counsel for the parties, I am of the opinion that this Court does not have the territorial jurisdiction to entertain the present petition for appointment of an Arbitrator. The territorial jurisdiction in the facts of the present case is to be determined in terms of Section 20 of the Code of Civil Procedure (for short the ‘Code’). Section 20 of the Act read as under: - 2 Arb. Case No. 113 of 2010 (O&M) 20. Other suits to be instituted where defendants reside or cause of action arises- subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction- (a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or (b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or (c) the cause of action, wholly or in part, arises. (Explanation)- A corporation shall be deemed to carry on business at its sole or principal office in (India) or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place. In the present case, respondent with whom the petitioner has entered into a contract carries on its business and has office at Lucknow. Therefore, in terms of Clause (b) of Section 20 of the Code, the Lucknow Court will have the jurisdiction to entertain the suit on behalf of the petitioner. The agreement between parties restricting jurisdiction as that of Lucknow Court excludes the jurisdiction of other courts. It is settled that the parties by agreement can restrict jurisdiction of one court but by agreement cannot confer jurisdiction. Reference be made to Globe Transport Corpn. v. Triveni Engg. Works, (1983) 4 SCC 707, where it was held that: “3. It is now settled law that it is not competent to the parties by agreement to invest a court with jurisdiction which it does not otherwise possess but if there are more than one forums where a 3 Arb. Case No. 113 of 2010 (O&M) suit can be filed, it is open to the parties to select a particular forum and exclude the other forums in regard to claims which one party may have against the other under a contract…”. The question whether the agreement restricting jurisdiction of one court excludes the jurisdiction of other courts only if the expression “only or alone” etc., is used, came up for consideration in A.B.C. Laminart (P) Ltd. v. A.P. Agencies, (1989) 2 SCC 163. It held : 21. From the foregoing decisions it can be reasonably deduced that where such an ouster clause occurs, it is pertinent to see whether there is ouster of jurisdiction of other courts. When the clause is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the other courts should avoid exercising jurisdiction. As regards construction of the ouster clause when words like “alone”, “only”, “exclusive” and the like have been used there may be no difficulty. Even without such words in appropriate cases the maxim “expressio unius est exclusio alterius” — expression of one is the exclusion of another — may be applied. What is an appropriate case shall depend on the facts of the case. In such a case mention of one thing may imply exclusion of another. When certain jurisdiction is specified in a contract an intention to exclude all others from its operation may in such cases be inferred. It has therefore to be properly construed. In view of the above, the ouster of all other courts is upon when the parties agreed to raise all disputes at Lucknow. The judgment referred to by learned counsel for the petitioner is not helpful to the arguments raised. In the aforesaid judgment relied upon by counsel for the petitioner, the agreed jurisdiction was that of Bangalore Court but it is the petitioner therein who had an office in Bangalore. The office of defendant was not at Bangalore. It was found that the lease agreement was executed in Delhi and the amount was advanced in Delhi, therefore, Bangalore Court has no jurisdiction. Thus, it was a case of conferring jurisdiction by Agreement, when such Court has no jurisdiction. In the present case, the respondent 4 Arb. Case No. 113 of 2010 (O&M) carries on the business and has office at Lucknow. Thus, it is Lucknow court alone which has jurisdiction to entertain present petition. In view of the aforesaid facts, the present petition is dismissed for want of territorial jurisdiction. However, it shall be open to the petitioner to invoke the jurisdiction of the competent court according to law. (HEMANT GUPTA) JUDGE 9.3.2011 preeti 5