Authored by Ms. Sejal Jain, Associate at Prakant Law Offices
A recent judgment by the Hon’ble High Court of Delhi in the matter of SNS Engineering Pvt. Ltd. v M/s Hariom Projects Pvt. Ltd and Anr.[1] delivers a decisive answer to a recurring issue in Indian arbitration: which court holds jurisdiction when parties include an exclusive jurisdiction clause in their contract, particularly if their business dealings and the execution of the contract happen elsewhere. In this case, the Petitioner (SNS Engineering) approached the Hon’ble Delhi High Court under section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator for the adjudication of disputes between the parties.
It is pertinent to note that here, all the activities involving the contract, including the negotiations, execution, payment, and performance, had taken place in and around Delhi. However, the arbitration clause in the contract specifically granted exclusive jurisdiction to the courts of Ahmedabad only in case of any disputes.
While making its case, the Petitioner argued that since the cause of action has arisen in Delhi, the courts of Delhi should have the jurisdiction to appoint the arbitrators. The Respondents, on the contrary, argued to uphold the exclusive jurisdiction clause of the arbitration agreement.
The Hon’ble Court, after a careful examination of the facts of the case in light of the precedents laid down by the Hon’ble Supreme Court, however, held firm that the contract’s explicit clause restricted jurisdiction to Ahmedabad. The judgment, delivered by Justice Jasmeet Singh held that an exclusive jurisdiction clause in an arbitration agreement essentially designates the “seat” of arbitration, even if the word “seat” is not used explicitly. This means that the named court is the only one with supervisory powers, including the authority to appoint arbitrators.
What makes this judgment particularly important is its resolute defense of party autonomy, a cornerstone of arbitration systems worldwide. The decision clarifies that, regardless of where business is conducted or contracts executed, parties are free to agree on a neutral “seat” for arbitration, and their choice must be respected. By focusing on the contract’s jurisdiction clause and disregarding competing notions of cause of action or convenience, the court provides legal certainty to future parties drafting agreements, warning them that the language of arbitration clauses is paramount.
Moreover, this judgment puts an end to potential forum shopping and litigation gamesmanship, both of which can cause delays and confusion in cross-regional commercial disputes. Courts across India now have firmer reasons to dismiss claims brought to the wrong jurisdiction when an exclusive clause is present. In an era where business transactions often span multiple states or cities, this judgment gives clear guidance on how contracts should be drafted and interpreted, ensuring faster and more predictable dispute resolution.
In sum, the Delhi High Court’s ruling is not only a reaffirmation of settled law but an important step in strengthening contractual freedom and judicial efficiency in Indian arbitration practice. By upholding the exclusive jurisdiction clause, the judgment sends a strong message: clarity in drafting is critical, and the courts will honor party autonomy as the guiding principle in arbitration agreements.
[1] 2025 SCC OnLine Del 5836.