𝐃𝐞𝐜𝐢𝐬𝐢𝐨𝐧 𝐨𝐧 𝐣𝐮𝐫𝐢𝐬𝐝𝐢𝐜𝐭𝐢𝐨𝐧 𝐭𝐨 𝐜𝐡𝐚𝐥𝐥𝐞𝐧𝐠𝐞 𝐚𝐧 𝐚𝐫𝐛𝐢𝐭𝐫𝐚𝐭𝐢𝐨𝐧 𝐚𝐰𝐚𝐫𝐝 𝐩𝐫𝐨𝐧𝐨𝐮𝐧𝐜𝐞𝐝 𝐮𝐧𝐝𝐞𝐫 𝐌𝐒𝐌𝐄𝐃 𝐀𝐜𝐭 (Delhi High Court)

Delhi Tourism And Transportation Development Corporation Vs M/s. Satinder Mahajan (May 2024)

The parties to dispute entered into a construction contract. Later, the Contractor (Respondent) to recover the outstanding payments approached the MSE Facilitation Council, Pathankot under MSMED Act.  

The petitioner challenged the arbitration award passed in favor of the Contractor before the Delhi High Court averring that cause of action arose in Delhi.

Whereas the petitioner objected that the Delhi High Court does not have jurisdiction to entertain the set-aside application.

The Court observed the following

1. Upon a proper interpretation of the contractual terms, the parties did not expressly provide for the seat of the arbitration under the Agreement, and only provided that the venue would be at the discretion of the arbitrator.
2. The reference to cause of action was for the purposes of determining the court which a party may approach in anticipation of arbitration proceedings, by way of an application under Section 9 of the Arbitration Act.
3. Objective of Section 18(4) of the MSME Act, which permits a medium or small enterprise to approach a Facilitation council at the place where it is located. 

𝑰𝒏 𝒕𝒉𝒆 𝒂𝒃𝒔𝒆𝒏𝒄𝒆 𝒐𝒇 𝒂𝒏 𝒆𝒙𝒄𝒍𝒖𝒔𝒊𝒗𝒆 𝒋𝒖𝒓𝒊𝒔𝒅𝒊𝒄𝒕𝒊𝒐𝒏 𝒄𝒍𝒂𝒖𝒔𝒆, 𝒃𝒚 𝒘𝒉𝒊𝒄𝒉 𝒔𝒖𝒄𝒉 𝒂𝒏 𝒆𝒏𝒕𝒆𝒓𝒑𝒓𝒊𝒔𝒆 𝒂𝒈𝒓𝒆𝒆𝒔 𝒕𝒐 𝒄𝒐𝒏𝒇𝒆𝒓 𝒋𝒖𝒓𝒊𝒔𝒅𝒊𝒄𝒕𝒊𝒐𝒏 𝒆𝒍𝒔𝒆𝒘𝒉𝒆𝒓𝒆, 𝒕𝒉𝒆 𝒍𝒆𝒈𝒊𝒔𝒍𝒂𝒕𝒊𝒗𝒆 𝒊𝒏𝒕𝒆𝒏𝒕 𝒕𝒉𝒂𝒕 𝒕𝒉𝒆 𝒅𝒊𝒔𝒑𝒖𝒕𝒆 𝒘𝒊𝒍𝒍 𝒃𝒆 𝒓𝒆𝒔𝒐𝒍𝒗𝒆𝒅 𝒂𝒕 𝒕𝒉𝒆 𝒍𝒐𝒄𝒂𝒕𝒊𝒐𝒏 𝒐𝒇 𝒕𝒉𝒆 𝒔𝒂𝒊𝒅 𝒎𝒆𝒅𝒊𝒖𝒎 𝒐𝒓 𝒔𝒎𝒂𝒍𝒍 𝒆𝒏𝒕𝒆𝒓𝒑𝒓𝒊𝒔𝒆, 𝒊𝒔 𝒇𝒖𝒓𝒕𝒉𝒆𝒓𝒆𝒅 𝒃𝒚 𝒕𝒉𝒊𝒔 𝒊𝒏𝒕𝒆𝒓𝒑𝒓𝒆𝒕𝒂𝒕𝒊𝒐𝒏.

Accordingly, it was held that courts at Delhi does not have jurisdiction to entertain the set-aside application. 

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