Case Note & Summary
The petitioner, Rockwood Hotels & Resorts Limited, a company with its registered office in Mumbai, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking a stay on the implementation of a termination notice dated 17 December 2012 issued by the respondent, Starwood Asia Pacific Hotels and Resorts Pvt. Limited, a Singapore company with a branch office in Haryana. The termination notice sought to terminate hotel operating agreements, including an operating service agreement dated 25 June 2010, a centralized service agreement, and a system licence and technical assistance agreement. The petitioner also sought an injunction restraining the respondent from acting on the termination notice. The respondent raised a preliminary objection regarding the maintainability of the petition in the Bombay High Court, arguing that no part of the cause of action arose within its territorial jurisdiction. The court examined the relevant facts: the petitioner's registered office was in Mumbai, but the agreements were executed in New Delhi, the place of arbitration was New Delhi, and the termination notice was issued from Haryana. The court noted that the agreements contained an exclusive jurisdiction clause vesting jurisdiction in courts in New Delhi. The court held that for a petition under Section 9, the court must have jurisdiction where the arbitration proceedings are held or where the cause of action arises. Since the arbitration was to be held in New Delhi and no part of the cause of action arose in Mumbai, the Bombay High Court lacked jurisdiction. The court dismissed the petition, leaving it open for the petitioner to approach the appropriate court.
Headnote
A) Arbitration - Territorial Jurisdiction - Section 9 of the Arbitration and Conciliation Act, 1996 - Interim Relief - Petition filed under Section 9 seeking stay of termination notice and injunction - Respondent raised preliminary objection as to maintainability - Court examined whether any part of cause of action arose within its jurisdiction - Held that since the agreements were executed in New Delhi, the place of arbitration was New Delhi, and the termination notice was issued from Haryana, no part of cause of action arose in Mumbai - Petition dismissed for lack of jurisdiction (Paras 1-10).
Issue of Consideration
Whether the Bombay High Court has territorial jurisdiction to entertain a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim relief in relation to termination of hotel operating agreements, when the agreements contain an exclusive jurisdiction clause in favor of courts in New Delhi and the place of arbitration is New Delhi.
Final Decision
Petition dismissed for lack of territorial jurisdiction. Petitioner is at liberty to approach the appropriate court.
Law Points
- Territorial jurisdiction under Section 9 of the Arbitration and Conciliation Act
- 1996
- Cause of action for interim relief
- Place of arbitration
- Exclusive jurisdiction clause
