Supreme Court on Conflicting Seat and Venue in Arbitration: Goa Seat, Delhi Only a Venue

Overview of the Decision

In Arcis Clean Energy Pvt. Ltd. Vs Parshva Innovation (Supreme Court of India), Civil Appeal No.___ of 2026 (Arising Out of Slp Civil No. 35915 of 2025), decided on 12/10/2026, the Supreme Court was called upon to resolve a recurring problem in commercial contracts: what happens when an arbitration clause refers to more than one place, and another clause of the agreement confers exclusive jurisdiction on courts at one location?

The Court examined how to determine the juridical seat of arbitration where:

  • The arbitration clause itself mentioned Delhi and Goa, and
  • A separate governing law and jurisdiction clause conferred exclusive jurisdiction on courts in Goa.

Ultimately, the Supreme Court held that Goa was the juridical seat of arbitration, and Delhi functioned only as a venue. As a result, the Delhi High Court did not have jurisdiction to entertain an application under Section 11(6) of the Arbitration and Conciliation Act, 1996, and the appointment of an arbitrator by the Delhi High Court was set aside.

Factual Matrix and Contractual Clauses

Franchise Agreement and Dispute

The dispute arose under a “Franchise Agreement” dated 03 August 2023 between Arcis Clean Energy Pvt. Ltd. and Parshva Innovation.

The agreement contained an arbitration mechanism in Clause 32 and a separate governing law and jurisdiction provision in Clause 38.

Key events were:

  • On 25 March 2025, Parshva Innovation issued a notice proposing a sole arbitrator under the arbitration clause.
  • Arcis Clean Energy rejected this proposal via a reply dated 19 April 2025.
  • Parshva then approached the Delhi High Court under Section 11(6) of the Arbitration and Conciliation Act, 1996 seeking appointment of an arbitrator.
  • The Delhi High Court, by order dated 11 November 2025, appointed an arbitrator and permitted him to determine the venue of hearings in consultation with the parties.

This order was challenged before the Supreme Court by Arcis Clean Energy.

Arbitration Clause – Two Different Places Identified

Clause 32 of the Franchise Agreement sets out the dispute resolution and arbitration framework. The material parts are:

  • Clause 32.4:
    • Refers to a sole arbitrator to be appointed by mutual consent.
    • States that “The precise location of the arbitration shall be within Delhi…”
  • Clause 32.5:
    • Provides that “The arbitration proceedings will be held in Goa…”
  • Clause 32.3 confirms that the process will be governed by the Arbitration and Conciliation Act, 1996.

Thus, both Delhi and Goa appear within the arbitration clause:

  • Delhi is described as the “precise location of the arbitration”,
  • Goa is stated as the place where the arbitration proceedings will be held.

Governing Law and Exclusive Jurisdiction Clause

Separately, Clause 38 of the agreement provides:

“This Agreement shall be interpreted and construed exclusively in accordance with the laws of India and parties shall agree to submit to the exclusive jurisdiction of competent courts in Goa, India.”

This clause:

  • Fixes Indian law as the governing law, and
  • Confers exclusive jurisdiction on competent courts in Goa.

Rival Contentions Before the Supreme Court

Appellant (Arcis Clean Energy Pvt. Ltd.)

The appellant’s primary case was that:

  • The juridical seat of arbitration was Goa, not Delhi.
  • Accordingly, only courts at Goa could exercise supervisory jurisdiction.
  • The Delhi High Court therefore lacked jurisdiction under Section 11(6) of the **Arbitration and Conciliation Act, 1996`.

Key arguments:

  1. Delhi as Venue, Goa as Seat

    • Clause 32.4 (Delhi) should be understood to relate merely to the venue.
    • Clause 32.5, read together with Clause 38, demonstrates that Goa was intended to be the juridical seat.

  2. Exclusive Jurisdiction Clause Controls

    • Because Clause 38 expressly requires the parties to submit to the exclusive jurisdiction of competent courts in Goa, it indicates that:
      • The supervisory jurisdiction over arbitration lies with Goa courts, and
      • Goa must be treated as the seat of arbitration.

  3. Case Law Relied On

    • Indus Mobile Distribution Private Limited v. Datawind Innovations Private Limited and others
    • Swastik Gases (P) Ltd. v. Indian Oil Corporation Ltd.
    • BGS SGS SOMA JV v. NHPC LIMITED
    • Arif Azim Company Limited v. Micromax Informatics FZE
    • Activitas Management Advisor Private Limited v. Mind Plus Healthcare Private Limited

These authorities were cited to establish that:

  • The seat of arbitration operates like an exclusive jurisdiction clause; and
  • Jurisdiction clauses and arbitration wording must be read together to determine the parties’ true intention regarding the seat.

Respondent (Parshva Innovation)

The respondent supported the Delhi High Court’s appointment of an arbitrator and argued that:

  1. Autonomy of Arbitration Agreement

    • The arbitration agreement is independent of the rest of the contract.
    • Therefore, Clause 38 (governing law and jurisdiction) should not be used to determine the seat for arbitration purposes.

  2. Delhi as Juridical Seat

    • Clause 32.4 explicitly declares that the “precise location of the arbitration shall be within Delhi”.
    • That language should be construed as fixing Delhi as the juridical seat.

  3. Priority of Earlier Clause

    • It was also argued that because Clause 32.4 (Delhi) appears before Clause 32.5 (Goa), the earlier clause ought to prevail in case of conflict.