Arbitration Clause Specifying Multiple Places Does Not Automatically Make The Venue The Seat: Supreme Court Refines The 'Significant Contrary Indicia' Test

"Where the contract specifies the jurisdiction of the court at a particular place, only such court will have the jurisdiction to deal with the matter as parties intended to exclude all other courts." Supreme Court, in a judgment delivered on October 12, 2026, held that when an arbitration agreement specifies multiple locations as venues for proceedings, the juridical seat of arbitration must be determined through a holistic reading of the agreement to ascertain the true intention of the parties.

A bench comprising Justice Manoj Misra and Justice Vijay Bishnoi emphasized that if an agreement designates multiple places, the "venue" does not automatically translate into the "juridical seat," necessitating an examination of other contractual clauses, such as the governing law and exclusive jurisdiction provisions.

Dispute Over Arbitral Seat

The dispute arose from a Franchise Agreement between Arcis Clean Energy Pvt. Ltd. and Parshva Innovation. While the agreement’s arbitration clause mentioned both Delhi and Goa as locations for the proceedings, a separate clause stipulated that the agreement was governed by the laws of India and that parties submitted to the exclusive jurisdiction of courts in Goa. Following a disagreement, the respondent moved the Delhi High Court under Section 11(6) of the Arbitration and Conciliation Act, 1996, to appoint an arbitrator, which the High Court granted.

Determining The Juridical Seat

The primary legal issue before the Supreme Court was whether the Delhi High Court possessed the jurisdiction to appoint an arbitrator, or if the juridical seat of arbitration was exclusively located in Goa. The Court was further called upon to clarify the interaction between a multi-venue arbitration clause and a standalone exclusive jurisdiction clause.

Application Of The BGS SGS SOMA Test

The Court reaffirmed the three-condition test established in the BGS SGS SOMA JV v. NHPC Limited case regarding when a venue can be construed as a seat. It noted that the presence of "significant contrary indicia" serves to rebut the presumption that a designated venue is the seat. In this instance, because the clause identified both Delhi and Goa, the Court found it did not satisfy the requirement of designating only one place, thereby preventing the automatic characterization of Delhi as the seat.

Harmonious Construction Of Clauses

The Court stressed that in cases of ambiguity, a harmonious construction of all contract terms is required to avoid redundancy. By reading the multi-venue arbitration clause in conjunction with the governing law and jurisdiction clause, the bench concluded that the parties’ intent was to vest exclusive supervisory jurisdiction in the courts at Goa. The Court reiterated that the "place of arbitration" expression is not decisive and must be supported by the overall contractual framework.

Jurisdictional Exclusivity Reaffirmed

"The intention of the parties - by having a jurisdiction clause – is clear and unambiguous that the courts at the chosen location alone shall have jurisdiction."

The bench distinguished the present case from several precedents relied upon by the respondent, noting that in those cases, the arbitration clauses generally specified a single, unambiguous location. The Court emphasized that where parties have specifically conferred exclusive jurisdiction upon a particular court, that choice remains a critical factor in determining the juridical seat, especially when the arbitration clause itself is indeterminate between two locations.

Court Finds Delhi High Court Lacked Jurisdiction

Following its analysis of the agreement in its entirety, the Supreme Court allowed the appeal and set aside the Delhi High Court's order. The Court clarified that because the juridical seat was effectively in Goa, the Delhi High Court lacked the requisite jurisdiction to entertain an application under Section 11(6) of the 1996 Act. Parties were granted liberty to approach the appropriate jurisdictional High Court to initiate fresh proceedings.

Date of Decision: 12 October 2026