Foreign governing-law and forum clauses do not oust Indian jurisdiction unless the foreign law is proved as fact.

An Indian court cannot treat a foreign governing-law and forum clause as ousting its jurisdiction unless the content and effect of the foreign law are proved as fact. Here, the agreements selected English law and English Courts for disputes, but no evidence was led on English law to show that the jurisdiction clause was exclusive in its true legal effect. The Bombay HC therefore held that the trial court could not conclusively decide the Section 9A jurisdictional objection on the record before it and set aside the ruling, restoring the application for fresh adjudication after evidence on the foreign law issue.

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Issues: (i) Whether the contractual clauses making English law the governing law and providing for settlement of disputes by English Courts ousted the jurisdiction of the Indian court; (ii) Whether the trial court's decision on the Section 9A jurisdictional objection could be sustained without proof of the content of English law, and whether the matter should be remitted for fresh decision.

Issue (i): Whether the contractual clauses making English law the governing law and providing for settlement of disputes by English Courts ousted the jurisdiction of the Indian court.

Analysis: The agreements expressly provided that they would be governed by and construed in accordance with English law, and that disputes on interpretation or performance would be settled by the English Courts. The governing law of the contract was therefore the proper law chosen by the parties. However, whether the jurisdiction clause was truly exclusive depended on its construction under the chosen proper law. Since the question turned on English law, that law had to be established as a fact before the court could conclude that Indian jurisdiction was excluded. The mere presence of a foreign governing-law clause did not by itself authorise an Indian court to hold that its jurisdiction stood ousted.

Conclusion: The clauses could not be finally held to exclude Indian jurisdiction in the absence of proof of the relevant English law.

Issue (ii): Whether the trial court's decision on the Section 9A jurisdictional objection could be sustained without proof of the content of English law, and whether the matter should be remitted for fresh decision.

Analysis: Foreign law is a question of fact and must be specifically pleaded and proved by evidence. No evidence was led on the content of English law governing the construction and effect of the jurisdiction clause. In those circumstances, the trial court could not conclusively determine the jurisdictional objection. The proper course was to set aside the order and remit the matter so that evidence could be adduced on the relevant questions and the jurisdiction issue could then be decided in accordance with law.

Conclusion: The impugned order was unsustainable and the Section 9A application had to be restored for fresh adjudication after evidence.

Final Conclusion: The jurisdictional ruling was set aside, and the parties were relegated to the trial court for a fresh decision on jurisdiction after proof of the foreign law issues.

Ratio Decidendi: Where the effect of a foreign governing-law and forum clause is in issue, the content and effect of the foreign law must be proved as fact before an Indian court can conclude that its jurisdiction is excluded.

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