Exclusive arbitration jurisdiction under Section 31(4) prevails over forum clauses once the first reference application is filed.

Where a competent court is first approached under Section 20 of the Arbitration Act, 1940, Section 31(4) confers exclusive jurisdiction on that court over the arbitration reference and all later applications, and a contractual forum selection clause cannot override that statutory mandate. The court also treated a final order under Section 41 as not open to collateral recall in later proceedings, holding that such an order could not be vacated merely while dealing with a different application. The bank guarantee dispute was linked to the underlying quality dispute, and bona fide contest justified interim protection against unilateral invocation pending adjudication.

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Issues: (i) Whether Section 31(4) of the Arbitration Act, 1940 conferred exclusive jurisdiction on the Calcutta High Court once the first Section 20 application had been filed there, so as to override the forum selection clause in one contract; (ii) Whether the learned trial Judge could vacate the earlier final order made on the Section 41 application and whether the appeal from that order was maintainable.

Issue (i): Whether Section 31(4) of the Arbitration Act, 1940 conferred exclusive jurisdiction on the Calcutta High Court once the first Section 20 application had been filed there, so as to override the forum selection clause in one contract.

Analysis: Section 31(4) was read as an overriding provision operating where an application in a reference is made in a Court competent to entertain it. The filing of a Section 20 application was treated as an application in the matter of a reference, even before any formal order of reference. Once such an application was made in the competent Court, that Court alone acquired jurisdiction over the arbitration proceedings and all subsequent applications. The forum selection clause in one contract could not displace the statutory mandate, because a private agreement cannot defeat an express legislative command. The fact that one contract contained no such clause also made bifurcation of proceedings impractical and oppressive.

Conclusion: The Calcutta High Court had exclusive jurisdiction, and the forum selection clause did not prevail over Section 31(4) of the Arbitration Act, 1940.

Issue (ii): Whether the learned trial Judge could vacate the earlier final order made on the Section 41 application and whether the appeal from that order was maintainable.

Analysis: The Section 41 order had already attained finality, and the learned trial Judge was not exercising appellate, revisional, or review jurisdiction when it was recalled. A final order could not be reopened collaterally in proceedings on a different application. The objection that no appeal lay under Section 39 was repelled on the footing that the order under challenge was not a proper collateral order that could validly have been made while dealing with the Section 20 matter, and the appellate court could correct the error. On merits, the bank guarantee dispute was closely connected with the underlying dispute regarding quality of goods, and the existence of a bona fide dispute justified protection against unilateral invocation pending adjudication.

Conclusion: The recall of the final Section 41 order was erroneous, the appeal was maintainable, and the earlier order restoring interim protection stood revived.

Final Conclusion: The appeals succeeded. The orders dismissing the Section 20 application and vacating the final Section 41 order were set aside, the Section 20 application remained maintainable before the Calcutta High Court, and the Section 41 order was restored.

Ratio Decidendi: Where a competent Court is first approached by an application under Section 20 of the Arbitration Act, 1940, Section 31(4) confers exclusive jurisdiction on that Court over the arbitration reference and subsequent applications, and a contractual forum selection clause cannot override that statutory command.

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