[Shaneen Parikh is a Partner and Head – International Arbitration at Cyril Amarchand Mangaldas and Amoga Krishnan. R is an Advocate]
The seat of arbitration determines the law that will govern the arbitral proceedings and also the court which has supervisory jurisdiction over that arbitration. India’s Supreme Court has long recognised that the designation of seat is analogous to an exclusive jurisdiction clause (see Bharat Aluminium v Kaiser Aluminium (BALCO) (2012) at [128]; Reliance Industries Ltd v Union of India (2014) at [43]; Indus Mobile Distribution Pvt Ltd v Datawind Innovations Pvt Ltd (2017) at [20]; and BGS SGS Soma JV v NHPC Ltd (BGS Soma) (2018) at [51]).
What was left to be considered, however, was a situation where the contract contained an exclusive jurisdiction clause and a compatible arbitration clause, but no seat of arbitration, i.e., effectively a reverse of the postulation in the above cases. Could an exclusive jurisdiction amount to a designation of the seat?
In 2024, the Delhi High Court in Kings Chariot v Tarun Wadhwa rejected an argument that the exclusive jurisdiction clause in that contract was sufficient to designate the seat of arbitration. In an earlier post on this Blog, the authors disagreed with the Delhi High Court, arguing a position where, absent other conflicting factors, the exclusive jurisdiction clause in a contract (containing an arbitration clause which does not specify a seat) ought to be seen as a designation of the seat of arbitration.
A judgment of the Supreme Court rendered in August 2025 in Activitas Management Advisor Private Limited v Mind Plus Healthcare Private Limited supports the authors’ position. We examine this decision in this post.
Activitas Explained
In Activitas, the contract between the parties contained an arbitration clause and an exclusive jurisdiction clause, but was silent as to the seat of arbitration, stating as follows: “[c]lient hereby submits to the exclusive jurisdiction of the Mumbai High Courts located in Mumbai in connection with any dispute related to this [contract] or any of the matters contemplated hereby. In case any dispute arises between the parties … parties hereby agree to appoint sole arbitrator … and can amicably resolve their dispute as per the procedure laid down in the Arbitration and Conciliation Act, 1996 before approaching the appropriate court for the same.”
Following certain disputes between the parties, Mind Plus invoked arbitration and applied for an appointment of arbitrator to the High Court of Punjab & Haryana (P&H) on the basis that its registered office was in Ludhiana (within the territorial jurisdiction of the P&H High Court). Activitas objected to the P&H High Court’s territorial jurisdiction and contended that the arbitration clause conferred exclusive jurisdiction upon the courts in Mumbai and so the Bombay High Court had jurisdiction to entertain the application.
The P&H High Court dismissed Activitas’s objection and held that it had territorial jurisdiction over the matter. It ruled that “[i]n view of judgment passed by this Court in … I Care Consultancy v Mahindra and Mahindra Financial Services Limited and others, the objection of [Activitas] qua territorial jurisdiction is not sustainable,” without any other reasoning to support its ruling.
In I Care, the arbitration clause stipulated only that the “venue of arbitration shall be at Mumbai”, specifying neither the seat of arbitration nor the court having exclusive jurisdiction. Ignoring the express designation of venue, the P&H High Court held that it had jurisdiction because the underlying contract was executed at Karnal, Haryana, both parties had their office at Karnal, and the cause of action arose within the P&H High Court’s jurisdiction.
Activitas challenged the P&H High Court’s order rejecting its objections as to its territorial jurisdiction before the Supreme Court.
The Supreme Court allowed the appeal and set aside the P&H High Court’s impugned order. It relied on its prior decision in Brahmani River Pellets v Kamachi Industries Limited where it had ruled that the designation of “venue” of arbitration in the contract Bhubaneshwar (in the State of Odisha), with no other specification of seat or exclusive jurisdiction of any court, would amount to a designation of the seat of arbitration. The Court further observed that if a contract specified 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.”
Applying the Brahmani River Pellets principle to Activitas and the subject contract, the Supreme Court stated while the arbitration clause did not use the words “seat” or “venue”, it did specify the “jurisdiction” of a specific court in the dispute resolution clause, due to which the express designation of jurisdiction of the Mumbai courts “must be understood in the context of arbitration and therefore the seat of the arbitration must be taken to be Mumbai.”
Activitas Brings Some Clarity, But Grey Areas Still Exist
The issue in Activitas began with the P&H High Court’s complete reliance on I Care. In our view, I Care itself seems to have been incorrectly decided, as it did not consider Brahmani River Pellets (where on a similar clause, the specified “venue” was considered by the Supreme Court to be sufficient for conferring jurisdiction). Instead, the P&H High Court in I Care relied on [96] of the Supreme Court’s judgment in BALCO where the Court held that under section 2(1)(e) of the Arbitration and Conciliation Act, 1996, two courts would have concurrent jurisdiction, i.e., the court where the cause of action arose and the court where the arbitration takes place, i.e., the seat.
However, I Care did not consider the Supreme Court’s ruling in BGS Soma where the Court cautioned against reading the observations at [96] of BALCO as if they were “Euclid’s theorems”. The Supreme Court further said that BALCOought to be read as saying that section 2(1)(e) must be read with section 20 of the Arbitration and Conciliation Act, which allows parties to designate their place (i.e., seat) of arbitration. Therefore, once a contract designated the seat of arbitration, such designation would amount to an exclusive jurisdiction clause.
While in Activitas, the stipulation of exclusive jurisdiction was mentioned in the same dispute resolution clause which referred to arbitration, other contracts may include these terms in separate clauses. Two cases of the Delhi High Court illustrate this scenario and in both the Court reached opposite conclusions.
In Kings Chariot, the contract stipulated that “[i]n case of any dispute between the parties, the matter will be referred to arbitration, arbitrator to be mutually agreed upon by the parties.” Another clause contained in an annexure to the contract stipulated that “[a]ll disputes subjected to Delhi jurisdiction only.” The Delhi High Court ruled that the jurisdiction clause was only a “general jurisdictional clause [which] does not refer to the seat or venue” rather than one conferring exclusive jurisdiction. On that basis, the Court held that, “[t]he general jurisdictional clause cannot be read to define the seat or venue.” While this case was decided before Activitas, the important point is that presumably because the exclusive jurisdiction clause was separate from the arbitration clause, the Delhi High Court found that it was general in nature.
By contrast, in Viva Infraventure Pvt Ltd v New Okhla Industrial Development Authority, the general conditions of contract contained an arbitration clause, which stipulated that “[a]ny suit or application for the enforcement of this arbitration clause shall be filed in the competent court at Gautam Buddh Nagar [in the State of Uttar Pradesh], no other court or any other district or Pradesh or outside Uttar Pradesh shall have any jurisdiction in the matter.” On an application by Infraventure, the Allahabad High Court appointed a sole arbitrator. However, in the procedural order 1 (PO1), the arbitrator moved the seat of the arbitration to New Delhi with the parties’ consent. During the course of the arbitration, Infraventure applied to the Delhi High Court (rather than courts in Uttar Pradesh), seeking an extension of the tribunal’s mandate to render the final award (as the statutory period for passing an award under the Act had elapsed).
Denying jurisdiction, the Delhi High Court held that the contract was “categorical and exclusionary in nature, making it clear that all other courts, outside Gautam Buddh Nagar / State of Uttar Pradesh … stand ousted from exercising jurisdiction in respect of disputes arising out of the Contract Agreement including enforcement of the arbitration clause.” The Court further stated that the legal position was “clear” that “where an agreement contains an exclusive jurisdiction clause covering the arbitration clause, the court identified in the exclusive jurisdiction clause will be deemed to have supervisory jurisdiction over the seat of arbitration.”
There is thus somewhat of a dissonance between Kings Chariot and Viva Infraventure. One way to reconcile the two decisions is that in Kings Chariot, the exclusive jurisdiction clause was not included in the same clause as the provision for arbitration and did not expressly say that it applied to arbitration, while in Viva Infraventure the clause provided exclusive jurisdiction for matters “including enforcement of the arbitration clause.” Further, like Activitas, the parties’ agreement in Viva Infraventure provided for exclusive jurisdiction in the same clause as the arbitration clause, while in Kings Chariot it was contained in an annexure to the main contract which contained the arbitration clause.
Conclusion
The Supreme Court’s decision in Activitas is a welcome one as it recognises that parties’ designation of an exclusive jurisdiction clause is sufficient without contrary factors. As a takeaway, parties and counsel may bear in mind that when drafting a contract containing an arbitration clause, one must ensure to specify a seat of arbitration. It is not necessary then to also specify the jurisdiction of specific courts. But if doing so (for instance, to say that disputes which are not arbitrable may then fall within the exclusive jurisdiction of those courts), ensure that the jurisdiction clause is made subject to the arbitration agreement and does not conflict with it.
– Shaneen Parikh & Amoga Krishnan. R
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