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Issues: Whether the Delhi court had territorial jurisdiction to entertain the challenge to the award passed by the Facilitation Council at Kanpur under section 19 of the Micro, Small and Medium Enterprises Development Act, 2006 read with section 34 of the Arbitration and Conciliation Act, 1996, notwithstanding the place where the Facilitation Council conducted the proceedings.
Analysis: The challenge to an award rendered in statutory arbitration under the MSMED Act is governed by the Arbitration and Conciliation Act, 1996, but the territorial forum for such challenge depends on the legal effect of the parties' jurisdiction clause. The Court held that the place where the Facilitation Council sat and conducted proceedings was only the venue, not the seat, and that the exclusive jurisdiction clause conferring jurisdiction on Delhi courts remained effective after the award. The overriding effect of the MSMED Act displaced the agreed arbitral procedure, but did not nullify the contractual stipulation on court jurisdiction for a post-award challenge.
Conclusion: The Delhi court had territorial jurisdiction to entertain the challenge, and the order rejecting the petition for lack of territorial jurisdiction was unsustainable.
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