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        Companies Law

        1981 (9) TMI 274 - SC - Companies Law

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        Exclusive jurisdiction in arbitration proceedings follows the first competent court where reference applications were made, overriding ordinary filing rules. Under the Arbitration Act, 1940, the ordinary rule is that an award is filed in the court having jurisdiction over a suit concerning the subject-matter of ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                        Provisions expressly mentioned in the judgment/order text.

                          Exclusive jurisdiction in arbitration proceedings follows the first competent court where reference applications were made, overriding ordinary filing rules.

                          Under the Arbitration Act, 1940, the ordinary rule is that an award is filed in the court having jurisdiction over a suit concerning the subject-matter of the reference. However, section 31(4) overrides that rule by vesting exclusive jurisdiction in the court where an application in the reference has already been made, if that court was competent to entertain it. On the facts described, the reference proceedings, later application, appointment of a successor arbitrator, and further directions showed that the SC retained control over the arbitration, so the award had to be filed there and not in the Delhi HC.




                          Issues: Whether, on the facts of the arbitration reference and the subsequent directions issued by the Supreme Court, the award had to be filed in the Supreme Court or in the Delhi High Court.

                          Analysis: The statutory scheme of the Arbitration Act, 1940 was examined in the light of the definition of "Court" in section 2(c), the filing mechanism under section 14(2), and the jurisdictional provisions in section 31. Ordinarily, an award is to be filed in the court which would have jurisdiction over a suit concerning the subject-matter of the reference. However, section 31(4), by reason of its overriding language, confers exclusive jurisdiction on the court in which an application in the reference has been made, provided that court was competent to entertain it. In the present matter, the reference, the later application for removal of the arbitrator, the appointment of the successor arbitrator by the Supreme Court, and the further directions fixing the manner and time for completion of the proceedings showed that the Supreme Court retained complete control over the arbitration proceedings.

                          Conclusion: The award had to be filed in the Supreme Court, and not in the Delhi High Court.

                          Ratio Decidendi: Where an application in a reference under the Arbitration Act, 1940 has been made to a court competent to entertain it, section 31(4) vests exclusive jurisdiction in that court over the arbitration proceedings and all subsequent applications, overriding the ordinary filing rule under section 14(2).


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                          ActsIncome Tax
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