Annual Arbitration Review 2018

Bharat Heavy Electricals Limited vs Uttar Pradesh Rajya Vidhyut Nigam Limited

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Judgment: Bharat Heavy Electricals Limited vs Uttar Pradesh Rajya Vidhyut Nigam Limited

 

Citation: 2019 SCC OnLine Del 7156

 

Court: Delhi High Court

 

Coram: Navin Chawla

 

Date: February 15, 2019

 

Overview: The Court held that where the parties agree not to insist upon the exclusive jurisdiction clause in an Agreement or raise such objection, and by their conduct, waive such condition/submit themselves to another Court’s jurisdiction, it cannot be said that the Court other than the one in which exclusive jurisdiction has been vested, would be without jurisdiction.

 

Issue: Whether parties can later contest jurisdiction of a Court by claiming exclusive jurisdiction vested in another court when they have not raised any such objections in previous proceedings?

 

Factual Background:

BHEL (“Petitioner”)”files an application for appointment of an arbitrator for adjudication of disputes that have arisen between him and Uttar Pradesh Rajya Vidhyut Nigam Limited (“Respondent”)in relation to various letters of award. Letters of award contained an arbitration agreement between parties, though respondent had not filed any objection to petitions, counsel for respondent had only orally challenged the jurisdiction of the Court.

 

Analysis:

Counsel for Petitionershowed that in previous orders of the court, the Respondenthad never raised any objections to the territorial jurisdiction of the court. The Court said that no challenge was made to the petitions earlier filed by the Petitionerbefore this Court. The said petitions have been disposed of granting relief in favour of the Petitioner. No challenge has been made by the Respondentto the said orders. Even in the present petitions, though opportunity was granted, reply was not filed by the Respondentand onlyanoral submission on challenge of jurisdiction was made.

 

Court relied upon its previous judgement rendered in the case of AAA Landmark Pvt. Ltd. v. AKME Projects Ltd[1],in which court held that where the parties agree not to insist upon the exclusive jurisdiction Clause in an Agreement or raise such objection and by their conduct waive such condition/submit themselves to another Court’s jurisdiction, it cannot be said that the Court other than the one in which exclusive jurisdiction has been vested, would be without jurisdiction. The Court also said that in any case, if the respondent is to raise any objection on the jurisdiction of the Court, it has to be so raised in the earlier petitions filed by the petitioner under Section 9 of the Act.

 

Conclusion:

In view of the above, Delhi High Court found no merit raised in contentions raised by the counsel for respondent and went ahead with appointed of a sole arbitrator for adjudication of disputes.

[1]2018 SCC OnLine Del 7586

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