Appointing an arbitrator does not make the High Court’s own city the seat of the arbitration

The Orissa High Court held a challenge to an award both time-barred and filed in the wrong court. It was filed forty-four days after the award, and the respondent’s own senior counsel conceded the limitation finding was wrong.

An arbitration that began with a contract containing no arbitration clause ended with an award that Mahanadi Coalfields could not challenge anywhere. The Orissa High Court held that its petition under Section 34 of the Arbitration and Conciliation Act, 1996 was filed in a court without jurisdiction, and also beyond limitation. On 23 September 2026, in Mahanadi Coalfields Ltd. and Ors. v. M/s GSCO (Gurmeet Singh and Company) Infrastructure Pvt. Ltd., a Bench of Justice Sanjay Kumar and Justice Sanjeev Sachdeva set that aside and restored the petition to the District Judge at Sundargarh.

The judgment, authored by Justice Sachdeva, decides two things of general application. A High Court that appoints an arbitrator under Section 11(6) does not thereby make the city where it sits the juridical seat of the arbitration. And because a High Court’s jurisdiction runs across the whole State, every District Court and Commercial Court within that State is competent to entertain a Section 34 petition unless the parties have agreed otherwise or a seat has been specifically determined.

A tender at Sundargarh, and no arbitration clause

In November 2012 Mahanadi Coalfields issued a tender for hiring heavy earth-moving machinery — shovels, drills, dozers — for the transfer and transportation of materials, including drilling, excavation, dumping, spreading and dozing, in specified areas of the Kulda Open Cast Project in the Basundhara–Garjanbahal areas at Sundargarh. GSCO was the successful bidder and a contract followed. It is admitted that the agreement contained no arbitration clause.

A completion certificate issued in July 2016 acknowledged that the assigned scope of work had been completed that June. Disputes over various claims survived it. GSCO took them to the Orissa High Court at Cuttack in three writ petitions filed in 2016 and 2017, seeking a direction to release withheld amounts.

By a common order in March 2019 the High Court appointed Justice M.M. Das (Retd.) as sole arbitrator under Section 11(6). The order recorded that the matter appeared to relate to interpretation of the conditions of the contract, that the appropriate remedy was to approach an arbitrator, and that counsel for the parties had submitted on mutual consent that the matter may be so referred.

GSCO then spent two years trying to undo that appointment. It challenged it in three special leave petitions. The Supreme Court, in April and July 2019, recorded its principal contention — that its counsel had not in fact consented before the High Court — declined to hear any other argument, and gave it liberty to seek review. It filed two review petitions and a recall application before the High Court. All three were dismissed as withdrawn between March and June 2021.

The arbitration then proceeded, with hearings held at Cuttack. In October 2021 the sole arbitrator made a common award in GSCO’s favour.

It is worth pausing on how this arbitration came to exist at all. There was no arbitration clause in the contract. The reference rests entirely on the High Court’s March 2019 order, made on the consent of counsel recorded in writ proceedings that GSCO itself had initiated. That order is the whole of the parties’ arbitration agreement, and it says nothing about where the arbitration is seated. Everything that followed — which court could supervise the award, and therefore which court could set it aside — had to be worked out from a contract drafted on the assumption that disputes would go to a civil court.

Two objections, raised ten months late

Mahanadi Coalfields filed three petitions under Section 34 on 8 December 2021 before the District Court at Sundargarh, registered as Arbitration Case Nos. 05, 06 and 07 of 2021. Ten months later, in September 2022, GSCO applied under Section 151 of the Code of Civil Procedure to have them rejected on two preliminary grounds: that they were barred by limitation under Section 34(3), and that the District Judge at Sundargarh lacked territorial jurisdiction because the seat of arbitration was Cuttack.

The objection came from the party that had brought the disputes to the High Court in the first place, obtained an arbitrator by consent, spent two years trying to undo that appointment, abandoned those attempts, and then won the award.

The District Judge dismissed that application in March 2024. GSCO carried it to the High Court under Articles 226 and 227, and in June 2025 the High Court allowed the writ petition and held the Section 34 petitions non-maintainable on both grounds.

On jurisdiction, the High Court reasoned that because the arbitrator had been appointed by the High Court in exercise of its Section 11(6) jurisdiction, and because the seat of the High Court is at Cuttack, Cuttack must be treated as the juridical seat, so that courts at Cuttack alone could entertain applications under Part I. It added Section 42, whose non-obstante clause requires all subsequent applications to be made to the court where the first application under Part I was filed — here, it held, the High Court at Cuttack.

On limitation, it held that the award had been passed and received long before the petitions were filed, that the delay exceeded three months and even the thirty-day condonable grace period, and that although time spent in a wrong court might be excluded, the appellants had persisted there long enough that the delay would far exceed what could be condoned.

The award was in October, the petition in December

The limitation finding did not survive contact with the record. The Attorney General, appearing for Mahanadi Coalfields, pointed out that the common award was dated 25 October 2021 and the Section 34 applications were filed on 8 December 2021 — forty-four days later, well inside the three-month period prescribed by Section 34(3). Mr. Ashok Panigrahi, senior counsel for GSCO, fairly conceded that the High Court’s finding was erroneous.

Venue is where the arbitrator sat; seat is what confers supervision

On jurisdiction the Court began with the contract. Clause 12 of the general terms and conditions of the notice inviting tender provided that for parties other than government agencies, redressal of disputes may be sought in the court of law within the jurisdiction of the District Court or High Court “where the work will be executed”. Clause 40 of the e-tender notice was to the same effect: disputes arising out of the tender and the contract awarded on it would be subject to the jurisdiction of the District Court, where the subject work is to be executed.

It is not in dispute that the work was executed within the district of Sundargarh. The Court also referred to a circular of November 2020 issued by the Law Department of Odisha in consultation with the High Court, which demarcates the territorial jurisdictions of Commercial Courts and shows that no Commercial Court had been assigned to Sundargarh. Nor was it GSCO’s case that the Commercial Court at Cuttack exercises jurisdiction over that district. It followed that the applications could only have been presented before the District Judge at Sundargarh.

The Court then took apart the seat finding. The order of March 2019 referring the disputes specifies neither seat nor venue. There is no agreement between the parties designating Cuttack. On the appellants’ case, uncontradicted by the respondent’s senior counsel, the proceedings were held at Cuttack only for the convenience of the arbitrator. The mere conduct of arbitral proceedings at a place cannot by itself determine the juridical seat.

Restating the settled distinction, the judgment holds that seat determines which courts exercise supervisory jurisdiction over the arbitration, while venue denotes only the physical location where sittings are held. In the absence of any express designation of Cuttack as the seat, the High Court clearly erred in treating the venue of the arbitration as the seat.

Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc. (2012) 9 SCC 552, Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd. (2017) 7 SCC 678 and BGS SGS Soma JV v. NHPC Ltd. (2020) 4 SCC 234 did not advance GSCO’s case, the Court held, for the simple reason that no seat had been expressly designated or consented to. Cuttack was a venue of administrative convenience and nothing more.

A High Court sits for the whole State

The second error the Court identified is the one with the wider reach. The High Court had treated the physical location of the High Court as fixing the seat, and in doing so restricted its own jurisdiction to the district in which it is situated.

Merely because the seat of the High Court is at Cuttack, the judgment holds, does not confer jurisdiction on the District or Commercial Courts at Cuttack. A High Court exercises jurisdiction over the entire State. All Commercial Courts, and District Courts where no Commercial Court has been set up, within the territorial jurisdiction of that High Court are therefore competent to entertain a petition under Section 34 — unless the parties have agreed to the contrary, or a seat has been specifically determined in the order of appointment, or the court has made some such stipulation or direction.

That formulation matters for any arbitration referred by a High Court where the reference order is silent on seat, which is a large class of cases. On the High Court’s view, a party whose work was performed in a distant district would have had to litigate its Section 34 challenge in the High Court’s own city regardless of what the contract said. On the Supreme Court’s view, the contract’s jurisdiction clause and the place of performance continue to operate, and Section 42 does not sweep every subsequent application into the city where the High Court happens to sit.

The appeal was allowed. The High Court’s order of June 2025 holding the Section 34 petition non-maintainable for want of jurisdiction and as time-barred was held unsustainable and set aside. The petition stands restored to the file of the District Judge, Sundargarh, who has been directed to decide it in accordance with law, expeditiously — nearly five years after the award it challenges.