Venue is not seat: foreign arbitration reference did not oust Indian court jurisdiction over the Section 34 challenge.

A contractual reference to Kuala Lumpur as the arbitration venue did not, by itself, make it the juridical seat or exclude Indian court jurisdiction under Part I of the Arbitration and Conciliation Act, 1996. The arbitration clause was governed by Indian law, and there was no express or implied determination of a foreign seat from the clause or surrounding indicia. Mere sittings at Kuala Lumpur and signing of the award there were insufficient to displace the Indian court's power to hear a Section 34 challenge. The Section 34 petition therefore remained maintainable in India.

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Issues: Whether, on a proper construction of the arbitration clause and the UNCITRAL Model Law, the reference to Kuala Lumpur as the venue ousted the jurisdiction of Indian courts to entertain a challenge under Section 34 of the Arbitration and Conciliation Act, 1996.

Analysis: The arbitration clause governed the contract by Indian law, but the reference to Kuala Lumpur was only as venue. A venue does not automatically become the juridical seat unless the agreement or surrounding indicia show a clear determination of seat. The clause did not contain any express or implied determination of the seat, and the mere holding of sittings at Kuala Lumpur and signing of the award there did not amount to determination. The distinction between seat and venue, and the principle of implied exclusion, required a holistic reading of the clause, but on its terms the arbitration was not shown to be seated outside India.

Conclusion: Indian courts had jurisdiction to entertain the Section 34 challenge, and the objection to maintainability failed.

Final Conclusion: The appeal succeeded and the order of the High Court was set aside, with the Section 34 petition to be dealt with by the Indian court.

Ratio Decidendi: A contractual reference to a foreign venue, without a clear determination that the venue is the juridical seat or other indicia of implied exclusion, does not by itself oust the jurisdiction of Indian courts under Part I of the Arbitration and Conciliation Act, 1996.

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