JATINDER versus M/S. CHOPRA LAND DEV. P. LTD. AND ANR.

Citation: [2007] 3 S.C.R. 545 · Decided: 02-03-2007 · Supreme Court of India · Bench: S.H. KAPADIA · Disposal: Dismissed

Judgment (excerpt)

-
JATINDER NATH 
A 
>--<, 
v. 
MIS. CHOPRA LAND DEV. P. LTD. AND ANR. 
MARCH 2, 2007 
[S.H. KAPADIA AND B. SUDERS HAN REDDY, JJ.] 
B 
)' 
Arbitration Act, 1940: 
ss. 8, 14. 16(3), 20, 28, 31(2)-Agreement-Regarding construction on 
a plot located at Delhi-Terms of agreement specifYing the Court at Faridabad c 
to have jurisdiction-Dispute-Reference to Arbitrator with concurrence of 
the parties-On the first date of hearing Arbitrator was absent-Suit under 
Section 20 of the Act-After fourteen months of the reference, ex-parte award 
by Arbitrator-Application before trial court at Faridabad for making the 
award rule of the Court-Territorial jurisdiction of the court objected to and D 
award also challenged as non-est as the Arbitrator became fimctus officio 
after four months from the date of reference-Trial Court upheld the objection 
to territorial jurisdiction-In Revision High Court held that the trial court 
had the territorial jurisdiction-In view of High Court judgment, award made 
rule of the Court-On appeal, held: In view of the terms of the agreement, 
court at F aridabad had territorial jurisdiction to adjudicate upon the award- E 
The award cannot be said to be vitiated only on the ground that it was 
passed beyond four months from the date of reference-Parties may proceed 
up to the stage of delivery of award, without the intervention of court-Court 
has power to extend the time and give life to the vitiated award by exercising 
judicial discretion under Section 28-However, in view of the facts of the F 
case, the ex-parte order making the award rule of the court is set aside. 
~ 
ss. 8 and 20-Difference between-Discussed. 
\.. 
Jurisdiction-Territorial jurisdiction-Jn Arbitration cases-
Determining factors-Held: Residence apart from a accrual of cause of action 
is relevant for determining the territorial jurisdiction of the court in G 
arbitration cases. 
"-
Respondent-Developer entered into an agreement with the appellant for 
.. 
construction of a housing complex at New Delhi. At that time appellant used 
to reside at Faridabad. As per the terms of the agreement, in case of any 
545 
H 
546 
SUPREME COURT REPORTS 
(2007) 3 S.C.R. 
A dispute regarding the agreement, courts at Faridabad alone had the 
jurisdiction. When the dispute arose, appellant requested for reference to 
named Arbitrator. The Arbitrator entered upon the reference on 24.8.1992. 
Respondent-developer had also flied a suit for permanent injunction in Delhi 
High Court. On the date when the first hearing was fixed neither the 
B Arbitrator nor the respondent reached. It was only the appellant who reached 
the venue. Appellant thereafter moved a suit under Section 20 of Arbitration 
Act, 1940. After fourteen months of referei:ce, the Arbitrator fixed the matter 
for hearing. Appellant requested the Arbitrator not to proceed in view of the 
pendency of the matter before High Court. But the Arbitrator gave the award 
ex parte. Developer-respondent filed an application under Section 14 of the 
C Act before the trial court at Faridabad. The appellant inter alia objected to 
the territorial jurisdiction of the trial court. Trial court held that it had no 
territorial jurisdiction to pass decree in terms of the award as the suit property 
was located in Delhi. Appellant moved High Court against the order of trial 
court. High Court allowed the Revision holding that in view of terms of the 
agreement exclusive jurisdiction lied with Faridabad court, and not the court 
D at Delhi; that Section 31(4) of the Act was not applicable; that there was no 
waiver on the part of the developer by filing suit for permanent injunction at 
Delhi as the suit had no co-relation with the arbitration matter; that under 
circumstances of the case Section 20 was not applicable. Pursuant to the order 
of High Court, award was made rule of the Court by the trial court. Hence the 
E present appeal. 
Dismissing the appeal, the Court 
HELD: I.I. By Clauses 11, 20, and 21 of the agreement, the parties 
agreed that in case of dispute between the parties the same shall be referred 
F for arbitration to the sole arbitrator at Faridabad and his decision shall be 
binding on both the parties. Under clause 21, the parties agreed that the 
Faridabad court alone shall have the jurisdiction in case of any dispute between 
the parties. [Para 151 [557-GI 
1.2. On the facts of this case, therefore, it cannot be said that the trial 
G court at Faridabad had no jurisdiction to make t

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