[Cites 22, Cited by 0]
Madhya Pradesh High Court
M/S. Beyond Malls Llp vs M/S Century 21 Malls Pvt. Ltd. on 16 April, 2026
Author: Vivek Rusia
Bench: Vivek Rusia
NEUTRAL CITATION NO. 2026:MPHC-JBP:29694
1 AA-93-2021
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VIVEK RUSIA
&
HON'BLE SHRI JUSTICE PRADEEP MITTAL
ON THE 16th OF APRIL, 2026
ARBITRATION APPEAL No. 93 of 2021
M/S. BEYOND MALLS LLP
Versus
M/S CENTURY 21 MALLS PVT. LTD.
Appearance:
Shri Anil Khare- Senior Advocate with Shri Ashwin Rastogi,
Shri Shantanoo Saxena and Shri Priyankush Jain- Advocate for the
applicant.
Shri Manoj Munshi- Senior Advocate with Shri Akshay Jha- Advocate for
the respondent.
Reserved on: 09.3.2026
Pronounced on: 16.04.2026
--------------------------------------------------------------------------------------------
ORDER
Per: Justice Vivek Rusia
This appeal has been filed under section 37 of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as "Act of 1996"), against the
order dated 01.11.2021 passed in MJC AV No.29/2021, whereby the learned
Commercial Court has dismissed the application filed under section 34 of the
Act of 1996 for want of territorial jurisdiction.
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2. The facts of the case, in short, are as follows :-
(i) The respondent purchased the land admeasuring 6.43 acres situated
at Village Misrod, Patwari Halka 50/42, Tehsil Huzur, District Bhopal and
thereafter obtained development permission from the TNCP, Bhopal on
13.12.2007 (Annexure A-4). The respondent constructed a multistoried mall
on the aforesaid land, and thereafter, given on lease by executing a lease
agreement dated 23.10.2017 (Annexure A-5) with the appellant. On
13.08.2019 (Annexure A-6), the respondent served a notice on the appellant
demanding the pending unpaid lease rent from October, 2018 to April, 2019,
along with security deposit interest @ 18% p.a. A reply was filed on
12.09.2010 (Annexure A-7). Due to non-fulfilment of the above demand, the
respondent sent a notice dated 21.08.2020 (Annexure A-10) for the
appointment of an Arbitrator resolving the dispute between them. The
respondent filed an application on 01.9.2020 under section 9 of the Act of
1996 before the 19th Additional District Judge, Bhopal, for the grant of
interim protection.
(ii) Vide order dated 27.11.2020, the District Court, Bhopal granted an
order of status quo , and later on the said application was disposed of on
22.12.2020 (Annexure A/2) as an Arbitrator had been appointed by the High
Court of Delhi on an application filed by the respondent. The respondent
filed an application under section 11(6) of the Act of 1996 before the High
Court of Delhi, which was registered as ARB.P. 507/2020. The said
application was not opposed by the respondent therein, and Shri Justice G.
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Rohini (Retired) was appointed as the sole arbitrator vide order dated
23.10.2020 (Annexure R/2).
(iii) The learned Sole Arbitrator initiated the Arbitration proceeding
and passed the interim award dated 10.06.2021 in favour of the respondent
herein. The appellant filed an application under section 34 of the Act of 1996
before the Commercial Court, Bhopal, on 12.07.2021. In the said application,
the respondent filed an objection challenging the jurisdiction of the
Commercial Court at Bhopal. Vide order dated 01.11.2021, the Commercial
Court Bhopal has dismissed the application under section 34 of the Act of
1996 on the ground of lack of jurisdiction. Hence, this appeal is before this
Court.
3. Learned counsel for the parties jointly submit that arbitration
proceedings are still going on and final award has not been passed, but the
issue raised in this appeal is liable to be decided in respect of territorial
jurisdiction of this Court in order to challenge the final award to be passed
under section 34 of the Act of 1996 by any of the parties in future.
4. Shri Anil Khare, learned Senior Advocate for the appellant,
submitted that the learned Commercial Court at Bhopal is bound by its
earlier order dated 22.12.2020, whereby the objection raised by the
respondent was rejected, holding that the Bhopal Court is treated as a judicial
seat based on the lease deed, and the respondent never challenged the said
order. Hence, the said order had attained finality, and the Commercial Court
Bhopal could not take a contrary view. It is further submitted that the parties,
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by executing an agreement, had decided that in relation to the lease deed, the
jurisdiction of the court where the premises are located may be any other
jurisdiction to which they may be entitled. Admittedly, the premise on rent in
question is situated at Bhopal; therefore, the parties have chosen the court at
Bhopal as the Court Seat, not the venue for all arbitration proceedings. Even
apart from this, the respondent has approached the Commercial Court at
Bhopal by filing an application under section 9 of the Act of 2016 on
01.09.2020. Therefore, the respondent cannot raise such an objection since
the respondent first approached the Court at Bhopal; therefore, such a
provision of section 42 of the Act of 1996 would attract. Learned counsel
has placed reliance on the judgment passed by the Apex Court in the case of
BGS SGS Soma JV Vs. NHPC Ltd; 2020 4 SCC 234 , which makes it clear
that section 42 of the Act of 1996 is designated to avoid conflicts of
jurisdiction by conferring exclusive supervisory authority on the court first
properly approached. Learned counsel has also placed reliance on the
judgment passed by the Apex Court in the case of General Manager East
Coast Railway Rail Sadan & another Vs. Hindustan Construction Co. Ltd;
2022 SCC Online SC 907. Learned Senior counsel further submitted that
BGS SGS (supra) has laid down that the "venue" is merely a venue and not a
"seat" can be concluded only when the agreement provides no other contrary
indicator, in the present case, Clause 17.15.2 (Annexure A-4) specifically
provides Delhi as a convenient and neutral venue for conducting the
arbitration proceedings. It is submitted that the question regarding
jurisdiction has been wrongly decided by the impugned order. The present
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appeal is maintainable as the use of the term "refusal to set aside an arbitral
award u/s 34" will include the refusal on all grounds, and the effect of the
impugned order is a refusal to set aside the arbitral award under section 34 of
the Act of 1996. Reliance is also placed on the decision in M/s Ravi Ranjan
Developers Pvt.Ltd. Vs. Aditya Kumar Chatterjee, 2022 SCC Online 568 and
Torrent Power Limited Vs. Dakshinanchal Vidyut Vitran Nigam Limited ,
2022 SCC Online ALL 883.
5 . Per contra, Shri Manoj Munshi, learned Senior Advocate for the
respondent, raised the issue of maintainability of this present appeal as this
appeal was filed under section 37, would not be maintainable because under
section 37(1)(c), the appeal lies from an order setting aside or refusing to set
aside an arbitral award under section 34. The impugned order is on the
jurisdiction; therefore, it does not fall under section 37(1)(c). It is further
contended that appellant itself objected to the jurisdiction of Court at Bhopal
in application under section 9 of Act of 1996 and further actively participated
in Arbitration Petition no.507/2021, Arbitration Appeal No.21/2021,
OMP(Misc.) (Comm) 259/2023, 269/2025 & 753/2025 in Delhi High Court,
therefore, once submitted to jurisdiction of Delhi High Court now cannot
approbate and reprobate simultaneously inasmuch waiver under section 4 of
the Act of 1996 is attracted and under section 5 of the Act of 1996 there is
minimal judicial intervention which bars judicial interference, including
extensions under section 29A of the Act of 1996 with consent. It is further
submitted that failure to raise jurisdictional or procedural objections in time
amounts to waiver under section 4, as has been held in the case of Bharat
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Sanchar Nigam Limited & another Vs. Motorola India Private Limited,
(2009) 2 SCC 337. It is also argued that though section 42 of the Act of
1996 provides exclusive jurisdiction to the court which was first approached,
but appellant itself objected to the Bhopal court's jurisdiction in the section 9
of the Act of 1996 application leading to appointment of arbitrator at Delhi
High Court, now section 42 cannot be invoked to restore jurisdiction to
Bhopal Court after appellant acquiesces to the court at Delhi.
6. We are unable to accept such contention raised by Mr.Munshi in
view of the law laid down by the Apex Court in the case of Chintels India
Limited Vs. Bhayana Builders Private Limited; (2021) 4 SCC 602 and M/s
Essar Construction Vs. N.P.Rama Krishna Reddy , (2000) 6 SCC 94, in
which, it has been held that literal reading of section 34(1)(c) of the Act of
1996 would show that a refusal to set aside an arbitral award as delay has not
been condoned under sub-section (3) of Section 34 of the Act of 1996
would certainly fall within section 37(12)(c) of the aforesaid Act.
7. Shri Munshi, learned senior counsel, argued that before filing an
application under Section 9 of the 1996 Act before the District Court,
Bhopal, an application under Section 11 was filed at the Delhi High Court
for appointment of an arbitrator, therefore, all subsequent proceedings would
be held before the Court at Delhi by virtue of section 42 of the 1996 Act.
Shri Munshi has placed reliance on clause 17.9.3 of the Agreement, under
which all the proceedings of conducting arbitration shall be held in Delhi.
The learned senior counsel has placed reliance on the judgment of the Apex
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Court in the case of General Manager, East Coast Railway, Rail Sadan and
another Vs. Hindustan Construction Company Limited, (2022) 20 SCC 212,
in which it has been held that merely because the appellants had not opposed
the appointment of an arbitrator, that by itself would not confer jurisdiction
upon the High Court, if otherwise it had no jurisdiction. It is further held that
in view of section 42 of the Act of 1996, the High Court of Andhra Pradesh
at Hyderabad alone would have jurisdiction to decide a subsequent
application arising out of a contract agreement, and further arbitral
proceedings will have to be made in that High Court alone.
Appreciation & Conclusions
8. Undisputed facts of the case are that the immovable property
under the agreement and in dispute is situated at Bhopal. The application
under section 9 of the Arbitration and Conciliation Act, 1996, was filed by
the respondent before the Commercial Court on 01.9.2020. The lease deed
between the parties was executed on 27.9.2017, containing the clauses
relating to "Dispute Resolution" from 17.9 to 17.15, which read as under:-
"17.9 Dispute Resolution
17.9.1 In case of any disputes or
differences arising between the
Parties hereto as to the
effect, interpretation, existence,
termination, breach, validity or
application of this Lease Deed
and related Lease Deeds or as to
their tights, duties or liabilities
there under, or to as any act matter
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or thing arising out of, or
consequent to, or in connection
with this Lease Deed ("Dispute"),
the Parties shall use all reasonable
endeavour to resolve the matter
amicably.
17.9.2 However, if any Dispute
cannot be resolved amicably, such
Dispute shall be referred to and
finally resolved by arbitration in
accordance with the Arbitration
and Conciliation Act, 1996.
17.9.3 The Sole Arbitrator shall
be appointed by the court, such
arbitration proceedings shall
be held in New Delhi and shall be
conducted in the English
language.
17.9.4 The award of the arbitrator
shall be in writing, final,
conclusive and binding upon
the Parties, and the Parties shall be
entitled (but not obliged) to enter
judgment thereon in the court
having competent jurisdiction;
17.9.5 The arbitral tribunal shall
apportion the costs of the
arbitration between the parties,
having regard to the outcome of
the case and other relevant
circumstances.
17.10 Lessee's right to off-set
Unless expressly agreed otherwise
in this Agreement, in the event that
the Lessor is
obliged to pay any amounts to the
Lessee, the Lessee may offset such
amount against Rent
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17.11 No waiver to fulfil
obligation
Neither Party shall by payment of
contractual damages be released
from its duty to fulfil any
obligation in which the Party is in
breach of.
17.12 Deadlines
17.12.1 In the periods established
by calendar days, if the last day of
the period should coincide with a
non-working day, it shall be
understood the deadline expires on
the next Working Day.
17.13 Sole Deed
This Lease Deed includes all of the
pacts between the Parties in
relation to the lease. Any proposal,
offer, information dossier, letter of
interest, MOU, document,
communication or information that
is different from the Lease Deed
and prior to the signing of this
Lease Deed, in relation to the lease
of the Premises, even if it had.
been granted and agreed to by the
Parties, shall be cancelled and
rendered null and void by means of
the signing of this Lease Deed by
the Parties.
17.14 Amendments
Every amendment or modification
to be done to this Leasé Deed shall
be done in written and with mutual
understanding of each Party.
17.15 Applicable Law and
Jurisdiction
17.15.1 This Lease Deed shall be
subject to and must be interpreted
in accordance with laws of India. .
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17.15.2 In relation to this Lease
Deed, the Parties agree to submit
themselves to the jurisdiction
of the courts of the where the
Premises is located, waiving any
other jurisdiction to which they
may be entitled.
17.15.3 The Annexures are part
of this Lease Deed and all
references thereto must. be
undérstood as made to both the
main body and the Annexures.
Without prejudice thereof, and in
the event of any discrepancy or
inconsistency, the main body of
the Lease Deed shall prevail
over any of the Appendices or its
future versions."
9. As per Clause 17.9.3, the Sole Arbitrator shall be appointed by the
court; such arbitrator's proceedings shall be held in New Delhi. Thus, the
arbitration proceedings shall be held in Delhi, which is only at the
convenience of the parties. Therefore, the application filed under section
11(6) of the Act of 1996 for the appointment of an Arbitrator (Justice Shri
G.Rohni, Retd.) stationed at New Delhi was rightly disposed of without any
objection. As the parties were in agreement that the arbitration proceedings
shall be held only at Delhi, and accordingly, under such agreement, an
application under section 11(6) of the Act of 1996 was filed by the
respondents before the High Court of Delhi for the appointment of an
arbitrator. So, only in respect of the venue of the arbitration proceedings, the
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place at Delhi was settled under clause 17.9 of the agreement. But, so far as
the applicable laws and jurisdiction are concerned, as agreed by the parties
by virtue of clauses 17.15.1 to 17.15.3, the parties agreed to submit
themselves to the jurisdiction of the Court where the leased property is
located, waiving any other jurisdiction to which they may be entitled. So far
as the seat and jurisdiction of the Court is concerned, the parties have agreed
and submitted themselves to the jurisdiction of the Court at Bhopal, because
admittedly the properties in question are situated at Bhopal.
10. Therefore, under such a situation, the respondent filed an
application under section 9 of the Act of 1996 before the Court at Bhopal. In
the said proceedings, when the present appellant raised an objection about
the jurisdiction, the learned court dismissed the said application vide order
dated 22.12.2020. The learned Commercial Court held that the application
under section 9 was filed on 01.9.2020 and by that time, the Arbitrator was
not appointed. Admittedly, the sole Arbitrator was appointed by the High
Court on 23.10.2020.
11. It is well-settled law that section 20 of the Act of 1996 determines
the place of arbitration by the Arbitral Tribunal having regard to the
circumstances of the case, including the convenience of the parties. Even
otherwise, section 20(1) thereof gives an authority to the party to agree in
respect of the place of arbitration. Section 20 of the Act of 1996 only deals
with the place of arbitration for the arbitration proceedings. But, section 42
of Act of l996 decides the jurisdiction of the Court, and according to which
where with respect to an arbitration agreement any application under this
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Part has been filed by the party, that Court alone will have the jurisdiction
over the arbitral proceedings and all subsequent applications arising out of
that agreement and the arbitral proceedings, shall be made in that Court, and
no other Court.
12. Therefore, in the present case, the respondent first moved an
application under section 9 of the Act of 1996 before the Court at Bhopal in
order to get the interim relief. In paragraph 15 of the said application, the
respondent disclosed that he has already issued a notice for the appointment
of an arbitrator and intends to approach the Hon'ble High Court of Madhya
Pradesh for the appointment of an arbitrator at the earliest; however, later on,
the application was moved before the High Court of Delhi. But the fact is
clear that the first application was filed before the District Court at Bhopal.
So, therefore, under section 42 of the Act of 1996, the Commercial Court,
Bhopal will have the jurisdiction. The respondent has wrongly raised an
objection and the learned Court has wrongly rejected the application.
13. The Apex Court in the case of BGS SGS Soma JV Vs. NHPC
Limited, (2020) 4 SCC 234 in paragraphs 32, 38, 48 & 59 has held as
under:-
"32. However, Section 42 cannot possibly
have any application to an application under
Section 11(6), which necessarily has to be
made before a High Court, unless the earlier
application was also made in a High Court. In
the instant case, the earlier application under
Section 9 was made in the District Court at
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Muzaffarpur and not in the High Court of
Judicature at Patna. An application under
Section 11(6) of the A&CAct for
appointment of Arbitrator, could not have
been made in the District Court of
Muzaffarpur. Therefore, Section 42 is not
attracted.
38. As observed by the Constitution
Bench, Section 2(2) of the A&C Act places a
threshold limitation on the applicability of
Part-I, where the place of arbitration is not in
India. The Constitution Bench in effect and
substance drew a distinction between venue
and place of arbitration, as contemplated in
Section 20 and held that only if the
agreement of the parties was construed to
provide for seat/place of arbitration in India,
would Part-I of the 1996 Act be applicable. If
the seat/place were outside India, Part-I
would not apply, even though the venue of a
few sittings may have been in India, or the
cause of action may have arisen in India.
48. In this case, the parties, as observed
above did not agree to refer their disputes to
the jurisdiction of the Courts in Kolkata. It
was not the intention of the parties that
Kolkata should be the seat of arbitration.
Kolkata was only intended to be the venue
for arbitration sittings. Accordingly, the
Respondent himself approached the District
Court at Muzaffarpur, and not a Court in
Kolkata for interim protection under Section
9 of the A&C Act. The Respondent having
himself invoked the jurisdiction of the
District Court at Muzaffarpur, is estopped
from contending that the parties had agreed to
confer exclusive jurisdiction to the Calcutta
High Court to the exclusion of other Courts.
Neither of the parties to the agreement
construed the arbitration clause to designate
Kolkata as the seat of arbitration. We are
constrained to hold that Calcutta High Court
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inherently lacks jurisdiction to entertain the
application of the Respondent under Section
11(6) of the Arbitration Act. The High Court
should have decided the objection raised by
the Appellant, to the jurisdiction of the
Calcutta High Court, to entertain the
application under Section 11(6) of A&C Act,
before appointing an Arbitrator.
59. Equally incorrect is the finding in
Antrix Corpn. Ltd. that Section 42 of the
Arbitration Act, 1996 would be rendered
ineffective and useless. Section 42 is meant
to avoid conflicts in jurisdiction of courts by
placing the supervisory jurisdiction over all
arbitral proceedings in connection with the
arbitration in one court exclusively. This is
why the section begins with a non obstante
clause, and then goes on to state "...where
with respect to an arbitration agreement any
application under this part has been made in a
court..." It is obvious that the application
made under this part to a court must be a
court which has jurisdiction to decide such
application. The subsequent holdings of this
court, that where a seat is designated in an
agreement, the courts of the seat alone have
jurisdiction, would require that all
applications under Part I be made only in the
court where the seat is located, and that court
alone then has jurisdiction over the arbitral
proceedings and all subsequent applications
arising out of the arbitral agreement. So read,
Section 42 is not rendered ineffective or
useless. Also, where it is found on the facts
of a particular case that either no "seat" is
designated by agreement, or the so-called
"seat" is only a convenient "venue", then
there may be several courts where a part of
the cause of action arises that may have
jurisdiction. Again, an application under
Section 9 of the Arbitration a Act, 1996 may
be preferred before a court in which part of
the cause of action arises in a case where
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parties have not agreed on the "seat" of
arbitration, and before such "seat" may have
been determined, on the facts of a particular
case, by the Arbitral Tribunal under Section
20(2) of the Arbitration Act, 1996. In both
these situations, the earliest application
having been made to a court in which a part
of the cause of action arises would then be
the exclusive court under Section 42, which
would have control over the arbitral
proceedings. For all these reasons, the law
stated by the Bombay and Delhi High Courts
in this regard is incorrect and is overruled."
14. Recently, the Apex Court in the case of Gayatri Balasamy Vs.
Novasoft Technologies Limited , (2025) 9 SCC 1 has held that it is the duty
of the Court to give weightage and due consideration to each choice made by
the parties and to construe the arbitration agreement in a manner that aligns
with most of such stipulation and intention. It is also held that where two or
more possible places that have been designated in the agreement either
expressly or impliedly equally appear to be a seat of arbitration then in such
case, conflict may be resolved through recourse to the doctrine of forum,
non-convenience and the seat be then determined based on which one of the
possible places may be most appropriate forum keeping in mind the nature of
the agreement, dispute in hand, the parties themselves and their intention and
finally concluded, thus the place most suited for interest of all the parties and
the ends of justice may be determined as a seat of arbitration. In paragraph
77 it has been held thus:-
"77. Our reasoning is bolstered when
considering the practical aspects. The
Arbitral Tribunals, when determining post-
award interest, cannot foresee future issues
that may arise. Post-award interest is
inherently future-oriented and depends on
facts and circumstances that unfold after the
award is issued. Since the future is
unpredictable and unknown to the arbitrator
at the time of the award, it would be
unreasonable to suggest that the arbitrator, as
a soothsayer, could have anticipated or
predicted future events with certainty.
Therefore, it is appropriate for the Section 34
Court to have the authority to intervene and
modify the post-award interest if the facts
and circumstances justify such a change."
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15. Therefore, in view of the above and as per clause 17.9 of the
Agreement, instead the parties have also chosen the court at Bhopal to have
jurisdiction and for arbitration proceedings, Delhi as the place for the
convenience of the parties, the respondent first approached the Court at
Bhopal by way of application under section 9 of the Act of 1996. So,
therefore, by virtue of section 42 of the Act of 1996, the Court at Bhopal
alone shall have the jurisdiction to decide the application under section 34 of
the Act of 1996.
16. The impugned order dated 01.11.2021 is hereby set aside,
proceeding of the case MJC AV No.29/2021 before the learned Commercial
Court are restored.
(VIVEK RUSIA) (PRADEEP MITTAL)
JUDGE JUDGE
RM
