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of <h1>Delhi HC lacks jurisdiction over arbitration award from Micro and Small Enterprises Facilitation Council without agreed seat</h1> <h3>AHLUWALIA CONTRACTS (INDIA) LTD. Versus OZONE RESEARCH & APPLICATIONS (I) PVT. LTD. AND ORS.</h3> AHLUWALIA CONTRACTS (INDIA) LTD. Versus OZONE RESEARCH & APPLICATIONS (I) PVT. LTD. AND ORS. - TMI Issues involved: The issues involved in this judgment are related to territorial jurisdiction in arbitration proceedings conducted under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) and the Arbitration and Conciliation Act, 1996.Details of the Judgment:Issue 1: Territorial Jurisdiction in Arbitration ProceedingsThe petitioner challenged an award by the Micro and Small Enterprises Facilitation Council in Nagpur, claiming the arbitration seat was in Delhi based on a Purchase Order clause. The respondent objected to Delhi's jurisdiction due to the arbitration being conducted in Nagpur under the MSMED Act.Issue 2: Interpretation of Jurisdiction and Seat of ArbitrationThe Division Bench's judgment in Indian Oil Corporation Ltd. vs. FEPL Engineering (P) Ltd. highlighted that the jurisdiction clause designates the venue, not the seat of arbitration. The MSMED Act's Section 18(4) allows Facilitation Councils to act as arbitrators, impacting jurisdiction.Issue 3: Conflict between MSMED Act and Arbitration ActThe Supreme Court's judgment in Gujarat State Civil Supplies Corporation Ltd. clarified that the MSMED Act's provisions override the Arbitration Act and contractual arrangements. The MSMED Act's Chapter V has an overriding effect on arbitration disputes involving micro and small enterprises.Conclusion:The Court dismissed the petition, ruling that the arbitration seat was in Nagpur, making the petition not maintainable in Delhi. The petitioner was granted liberty to file a petition in the appropriate court. The judgment was forwarded to the respondent's counsel due to their absence during the proceedings.
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