MAHANADI COALFIELDS LTD & ORS. v. M/S GSCO (GURMEET SINGH AND COMPANY) INFRASTRUCTURE PVT. LTD.

2026 INSC 1038

Reportable

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. OF 2026 (@ SPECIAL LEAVE PETITION (C) NO. 2 1 3 7 5 O F 2 0 2 5 )

MAHANADI COALFIELDS LTD & ORS. .…. APPELLANT (S)

VERSUS

M/S GSCO (GURMEET SINGH AND COMPANY) INFRASTRUCTURE PVT. LTD. ..…RESPONDENT(S)

JUDGMENT

SANJEEV SACHDEVA, J.

1. Leave granted.

2. Subject appeal impugns judgment dated 20.06.2025 passed by the High

Court in Writ Petition (C) No. 12707 of 2024, whereby the High Court has

allowed the Writ Petition filed by the Respondent under Articles 226 and 227

of the Constitution of India and thereby held that the petition under Section

34 of the Arbitration and Conciliation Act, 19961 filed by the Appellants was Signature Not Verified

not maintainable. The High Court has held that the petition filed under Section Digitally signed by babita pandey Date: 2026.09.23 17:01:53 IST Reason:

1 ‘Act’ for short

34 of the Act before the Court of the District Judge, Sundargarh, was not

maintainable for want of jurisdiction and also being time barred.

3. On 07.11.2012, a tender was issued by the Appellants for hiring of

HEMM (Shovel, Drill, Dozer etc.) for transfer and transportation of materials

in various strata including drilling, excavation, dumping spreading dozing

and other allied works in specified areas of dumping as per the instructions

of project officer/management of Kulda OCP, Basundhara – Garjanbahal

areas of MCL at Sundargarh.

4. Respondent was the successful bidder, and accordingly, a contract was

executed between the parties. It is an admitted position that the agreement did

not contain any arbitration clause.

5. On 03.07.2016, a completion certificate was issued by the Project

Officer of the Appellants, acknowledging the competition of the assigned

scope of work on 29.06.2016. However, during and after the execution of the

work, certain disputes arose between the parties in relation to various claims

under the contract. Aggrieved by the same, Respondent approached the High

Court of Orissa at Cuttack in W.P.(C). Nos. 19909 of 2016, 473 of 2017 and

6. By a common order dated 25.03.2019, the Hon’ble High Court at

Cuttack appointed Mr. Justice M.M. Das (Retd.) as the Sole Arbitrator under

Section 11(6) of the Act, to adjudicate the disputes between the parties.

Relevant portion of the common order is reproduced herein:

“by way of this writ petition, the petitioner (GSCO in that case) has prayed for a direction to the opposite parties (MCL in that case) to release the withheld amount……………….For the record, it seems that this matter relates to interpretation of the condition of the contract. Appropriate remedy for the parties is to approach the Arbitrator. Learned counsels for the parties on mutual consent submit that this matter may be referred to the Arbitrator…..”

7. Being aggrieved by the appointment, Respondent challenged the

appointment before this Court in SLP (C) No. 9676 of 2019, SLP (C)

No.11969 of 2019 and SLP (C) No.11551 of 2019. This Court, vide orders

dated 22.04.2019 and 01.07.2019 held that:

“the main contention of the Ld. Senior Counsel appearing on behalf of the Petitioner (respondent herein) is that the Counsel appeared before the High Court has not consented with the order which was passed by the said Court agreeing for arbitration. We are not inclined to hear any other contention raised…petitioner (respondent herein) is at liberty to approach the High Court for

filing of Review Petition bringing it to the notice of the High Court.”

8. Respondent filed two Review Petitions before the High Court, being

RVWPET No. 145 of 2019 (arising out of W.P.(C) No. 19909 of 2016) and

RVWPET No. 223 of 2019 (arising out of W.P.(C) No. 473 of 2017) and a

Recall Petition bearing I.A. No. 14601 of 2019 (arising out of W.P.(C) No.

474 of 2017) before the High Court to recall the order dated 25.03.2019. The

High Court dismissed both the Review Petitions as withdrawn by orders dated

19.03.2021 and 18.06.2021. The Recall Petition was also dismissed as

withdrawn on 15.03.2021.

9. Thereafter, the arbitration proceedings were commenced by the

Arbitrator and the proceedings were held at Cuttack. The Sole Arbitrator, on

25.10.2021, passed a common Arbitral Award in favour of the Respondent.

10. Appellants filed 3 separate petitions under Section 34 of the Act on

08.12.2021 being Arbitration Case Nos. 05, 06 and 07 of 2021 before the

District Court, Sundargarh, seeking setting aside the arbitral award.

11. Respondent on 27.09.2022 filed Miscellaneous Application under

Section 151 Code of Civil Procedure seeking rejection of the petition filed by

the Appellants under Section 34 of the Act raising preliminary objections to

the maintainability of the proceedings on the following two grounds:

(a) That the Section 34 petitions were barred by limitation, having been filed beyond the statutory period as prescribed in Section 34(3) of the Act, as claimed by GSCO.

(b) That the District Judge, Sundargarh lacked territorial jurisdiction to entertain the Section 34 petitions, owing to the seat of arbitration being at Cuttack.

12. Said application was dismissed by the District Judge on 06.03.2024,

pursuant to which subject Writ Petition was filed by the Respondent before

the High Court of Orissa at Cuttack.

13. By the impugned order dated 20.06.2025, the High Court has allowed

the Writ Petition and dismissed the petition filed under Section 34 of the Act

holding the same to be non-maintainable for want of jurisdiction and also on

ground that the petition was filed beyond the period of limitation.

14. The High Court held that the seat of arbitration was at Cuttack. The

fulcrum of the decision of the High Court is based on the fact that the

appointment of the Arbitrator was made by the High Court in exercise of its

jurisdiction under Section 11(6) of the Act and that as the seat of the High

Court is at Cuttack, Cuttack must be ordered as juridical seat of arbitration

and the courts at Cuttack alone are vested with exclusive jurisdiction to

entertain any application under Part I of the Act, including a petition under

Section 34 of the Act.

15. The High Court was of the view that Respondent had rightly invoked

Section 42 of the Act to buttress its case on jurisdiction and since Section 42

begins with a non-obstante clause and mandated that once a party had

approached the Court for any application under Part I of the Act, all

subsequent applications shall be made in the same court and no other.

16. The High Court held that, since the Section 11(6) petition for

appointment of an Arbitrator was filed before the High Court at Cuttack, by

operation of Section 42 of the Act, that Court alone would have jurisdiction

over all subsequent applications arising from the same arbitration agreement.

Consequently, the High Court held that the Section 34 petition filed before the

Sundargarh Court would be barred by Section 42 of the Act.

17. On the question of limitation, the High Court held that the Arbitral

award was passed and received by the parties long before the filing of the

petition at Sundargarh. The High Court held that the delay in filing the petition

far exceeded the period of three months and even if the condonable grace

period of 30 days was considered, the petition under Section 34 of the Act

would be clearly barred by limitation. The High Court held that, even if the

petition at Sundargarh were treated to be initially filed in the wrong Court

and the time spent therein could be excluded, since the Appellants chose to

persist in the wrong Court and by the time the issue was decided, the delay

would far exceed what is condonable. Thus, the High Court held that the

petitions were clearly barred by limitation.

18. Aggrieved therefrom, subject appeal has been filed by the Appellants.

19. On the question of limitation, Learned Attorney General, appearing on

behalf of the Appellants, submitted that the objection petition under section

34 of the Act was filed within the period of limitation. He submitted that the

common Arbitral Award was dated 25.10.2021 and the applications under

Section 34 of the Act were filed on 08.12.2021, well within the three month

period prescribed in Section 34(3) of the Act.

20. He submitted that the finding recorded by the High Court that the

applications under Section 34 of the Act were barred by limitation is contrary

to the admitted facts on record.

21. Mr. Ashok Panigrahi, learned Senior Counsel for the Respondent fairly

conceded on the question of limitation and acknowledged that the finding of

the High Court is erroneous.

22. On the question of jurisdiction, Learned Attorney General submitted

that the dispute arose out of a contract for execution of works at the Kulda

Open Cast Project, Sundargarh, and that the contract itself contemplated that

disputes would be subject to the jurisdiction of the competent court within

whose territorial jurisdiction the work was executed. Since, the cause of action

substantially arose at Sundargarh, and therefore, the Court at Sundargarh was

the competent Court within the meaning of Section 2(1)(e) of the Act.

23. Reference may be had to Clause 12 the General Terms and Conditions

of the Notice Inviting Tender, which reads as under:

“12. SETTLEMENT OF DISPUTES ***** ***** **** If differences still persist, the settlement of dispute with Government Agencies shall be dealt with as per the guidelines issued by the Ministry of Finance; Government of India in this regard, in case of parties other than Govt. Agencies, the redressal of the dispute may be sought in the court of law within the

jurisdiction of District Court/High Court, where the work will be executed.”

24. Clause 40 of the eTender Notice dated 07.11.2012 reads as

under:

“Matter relating to any dispute or differences arising out of this tender and subsequent contract awarded based on this tender shall be subject to the Jurisdiction of District Court, where the subject work is to be executed.”

25. It is not in dispute that the subject work was executed within the district

of Sundargarh. Reference be also had to the Circular dated 13.11.2020 issued

by the Law Department, State of Odisha in consultation with the High Court

of Orissa, which shows that no Commercial Court was assigned to the district

of Sundargarh. It is also not the case of the Respondent that the Commercial

Court at Cuttack exercises jurisdiction over cases arising out of the district of

Sundargarh. The notification demarcates territorial jurisdictions of

Commercial Courts, and since no Commercial Court had been established for

Sundargarh at the relevant point of time, the applications under Section 34

could only be presented before the learned District Judge, Sundargarh.

26. The High Court has erred in holding that Cuttack constituted the “seat

of Arbitration” merely because the arbitral proceedings were conducted there.

Order dated 25.03.2019 whereby the disputes were referred to the sole

arbitrator does not specify any seat or venue. There is also no agreement

between the parties, agreeing to Cuttack being the seat of Arbitration.

27. As per the Appellants, the arbitral proceedings were held at Cuttack

only for the sake of convenience of the Arbitrator. Nothing to the contrary has

been pointed out by learned senior counsel for the Respondent. Thus, mere

conduct of arbitral proceedings could not per se determine the juridical seat

of arbitration.

28. There is a distinction between “seat” and “venue” of arbitration. While

‘Seat’ determines the Courts exercising supervisory jurisdiction over the

arbitration proceedings, ‘Venue’ merely denoted the physical location where

the sitting 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.

29. The judgments in the case of Bharat Aluminium Co. v. Kaiser

Aluminium Technical Services Inc. (BALCO)2, Indus Mobile Distribution Pvt.

Ltd. v. Datawind Innovations Pvt. Ltd.3, BGS SGS Soma JV v. NHPC Ltd.4 do

not further the case of the Respondent for the reason that there is no “Seat”

expressly designated or consented to by the parties. Cuttack was only a venue

of the arbitration due to administrative convenience.

30. The High Court has clearly erred in also holding the ‘Seat’ as Cuttack

because the disputes were referred to the Arbitrator by the High Court which

has its seat at Cuttack. Merely because the seat of the High Court is at Cuttack

would not confer jurisdiction on the District or Commercial courts at Cuttack.

The High Court has clearly erred in restricting the jurisdiction of the High

Court to the District within the territory of which the High Court is physically

situated, i.e. Cuttack.

31. A High Court of a State exercises jurisdiction over the entire State and

as such all the Commercial Courts/District Courts (where no commercial

Court has been set up) within the territorial jurisdiction of the High Court

would have jurisdiction to entertain a petition under section 34 of the Act,

unless there is an agreement of the parties to the contrary or a specific

3 (2017) 7 SCC 678 4 (2020) 4 SCC 234

determination of a ‘Seat’ in the order of appointment or any such

stipulation/direction by the Court.

32. In view of the above, the appeal is allowed and the impugned order of

the High Court dated 20.06.2025 holding that the petition filed by the

Appellants, under Section 34 of the Act before the Court of the District Judge,

Sundargarh, was not maintainable for want of jurisdiction and also being time

barred is not sustainable and is accordingly set aside. The Petition under

Section 34 of the Act, filed by the Appellants, is restored on the file of the

District Judge, Sundargarh, who shall decide the same in accordance with law

expeditiously.

………………………….J. [SANJAY KUMAR]

…………………………….J. [SANJEEV SACHDEVA] New Delhi; September 23, 2026