Judgment Analysis

This judgment will put an end to the habit of parties taking advantage of the non-exclusive jurisdiction clause with regard to courts for interim relief even after deciding on the seat of arbitration.

- B. Gopalakrishnan

The Hon’ble Supreme Court vide its judgment in Indus Mobile Distribution Private Limited v. Datawind Innovations Private Limited and Ors. (Civil Appeal Nos. 5370-5371 of 2017 arising out of SLP (Civil) Nos. 27311-27312 of 2016)2 dated April 19, 2017 per R. F. Nariman, J. has settled an interesting point of law in the field of arbitration. In fact, the judgment has indirectly held that domestic arbitration is at par with international arbitration.

Issue

An interesting issue that was for consideration before the Hon’ble Supreme Court was whether, when the seat of arbitration is Mumbai, an exclusive jurisdiction clause stating that the courts in Mumbai alone will have jurisdiction in respect of disputes arising under the agreement would oust all other courts, including the High Court of Delhi, whose judgment is appealed against.

Facts of the case

Respondent No.1 is engaged in the manufacture, marketing, and distribution of mobile phones, tablets, and their accessories. Respondent No.1 was supplying goods to the Appellant at Chennai from New Delhi. The Appellant approached Respondent No.1 and expressed an earnest desire to do business with Respondent No.1 as its retail chain partner. This being the case, an agreement dated October 25, 2014 was entered into between the parties.