Arcis Clean Energy Pvt. Ltd. v. Parshva Innovation (2026): Seat vs Venue of Arbitration

Citation: 2026 INSC 1109
Date of Judgment: 12 October 2026
Court: Supreme Court of India
Bench: Justice Manoj Misra and Justice Vijay Bishnoi
Proceedings: Civil Appeal arising out of SLP (Civil) No. 35915 of 2025

If an arbitration agreement mentions both Delhi and Goa, which High Court has the authority to appoint the arbitrator?

The answer depends on more than the names of the places listed in the contract. In Arcis Clean Energy Pvt. Ltd. v. Parshva Innovation, the Supreme Court examined the agreement as a whole and held that Goa was the juridical seat of arbitration, while Delhi served only as a venue. As a result, the Delhi High Court lacked jurisdiction to appoint the arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996.

2. Meet the Parties

• Appellant: Arcis Clean Energy Pvt. Ltd., which challenged the Delhi High Court’s order appointing an arbitrator.
• Respondent: Parshva Innovation, which had approached the Delhi High Court under Section 11(6) of the Arbitration and Conciliation Act, 1996.
• Court deciding the appeal: Supreme Court of India.

3. What Happened? The Facts of the Case

The dispute arose from a franchise agreement dated 3 August 2023 between Arcis Clean Energy Pvt. Ltd. and Parshva Innovation. The agreement contained an arbitration clause, but its terms referred to both Delhi and Goa.

Clause 32.4 stated that the precise location of arbitration would be within Delhi. However, Clause 32.5 provided that the arbitration proceedings would be held in Goa.

The agreement also contained Clause 38, titled “Governing Law and Jurisdiction”. It stated that Indian law would govern the agreement and that the parties would submit to the exclusive jurisdiction of the competent courts in Goa.

These provisions created an apparent conflict. Should the parties treat Delhi as the legal seat because Clause 32.4 referred to it, or should Goa control because the agreement directed proceedings there and gave Goa courts exclusive jurisdiction?

The dispute escalated when Parshva Innovation proposed a sole arbitrator through a notice dated 25 March 2025. Arcis Clean Energy rejected the proposal on 19 April 2025. Parshva Innovation then approached the Delhi High Court under Section 11(6) of the 1996 Act.

On 11 November 2025, the Delhi High Court appointed an arbitrator and left the selection of the hearing venue to the arbitrator in consultation with the parties.

Arcis Clean Energy challenged that order before the Supreme Court. It argued that the agreement designated Goa as the juridical seat and that the Delhi High Court therefore lacked jurisdiction.

4. The Big Legal Question

When an arbitration agreement refers to two places and separately grants exclusive jurisdiction to courts in one of them, how should the court determine the juridical seat of arbitration and identify the competent High Court under Section 11(6)?

The Supreme Court had to interpret the relevant clauses together rather than treat one reference to a location as conclusive.

5. What Did the Supreme Court Decide?

The Supreme Court allowed the appeal and set aside the Delhi High Court’s order.

After examining the agreement as a whole, the Court held that:

• Goa was the juridical seat of arbitration.
• Delhi was a venue for arbitration, not the juridical seat.
• The Delhi High Court lacked jurisdiction to entertain the application under Section 11(6) of the Arbitration and Conciliation Act, 1996.
• The parties remained free to approach the appropriate court with jurisdiction over the arbitration.

The Supreme Court did not decide that Delhi could never host an arbitration hearing under the agreement. Instead, it distinguished the physical location of proceedings from the legal seat that determines the court’s supervisory jurisdiction.

6. Why Did the Court Reach This Decision?

The Court’s reasoning highlights three important principles of arbitration law.

A. Courts must distinguish the seat from the venue

The juridical seat determines which courts exercise supervisory jurisdiction over the arbitration. Once the parties establish the seat, the courts at that seat generally have exclusive jurisdiction over matters concerning the arbitration, subject to the applicable statutory framework.

The venue, by contrast, refers to the physical location where the tribunal conducts hearings. A hearing may take place at a venue without making that location the juridical seat.

The Court relied on the principles in BGS SGS SOMA JV v. NHPC Ltd. and Arif Azim Co. Ltd. v. Micromax Informatics FZE to explain when a place mentioned in an arbitration clause may be treated as the seat. Those decisions emphasise the wording of the clause, whether the proceedings are anchored to one place, and whether other contractual terms point elsewhere.

Here, the agreement referred to both Delhi and Goa. Delhi therefore could not automatically become the seat merely because Clause 32.4 identified it as the location of arbitration.

B. The entire agreement must be read together

The Court examined Clauses 32.4, 32.5 and 38 together.

Clause 32.4 referred to Delhi, while Clause 32.5 stated that the proceedings would be held in Goa. Clause 38 gave the competent courts in Goa exclusive jurisdiction.

Rather than allow one clause to cancel out the others, the Court interpreted them harmoniously. Read together, the clauses showed that the parties intended Goa to serve as the juridical seat and Delhi as the venue.

The Court also relied on Mankastu Impex (P) Ltd. v. Airvisual Ltd., which explains that the expression “place of arbitration” alone does not conclusively establish the parties’ choice of seat. Courts must consider the agreement’s other provisions and, where relevant, the parties’ conduct.

C. The seat determines the competent court for arbitration-related applications

The Supreme Court reiterated the principle that the seat of arbitration carries jurisdictional significance. The courts at the seat ordinarily supervise the arbitral proceedings.

Because Goa was the juridical seat, the Delhi High Court could not appoint the arbitrator under Section 11(6) in this case. The Supreme Court therefore set aside the appointment order and allowed the parties to pursue appropriate proceedings before the jurisdictional High Court.

The ruling reinforces an important drafting lesson: parties should clearly identify the seat and ensure that their arbitration and jurisdiction clauses work together.

7. The Golden Rule: Ratio Decidendi

Courts must determine the juridical seat by interpreting the arbitration clause and the agreement as a whole. When an agreement identifies multiple locations, a reference to one place does not automatically make it the seat. Other provisions, including a clause granting exclusive jurisdiction to courts at a particular place, can help establish the parties’ intention.

In this case, the combined effect of Clause 32.5 and Clause 38 established Goa as the juridical seat, while Delhi remained a venue. The Delhi High Court consequently lacked jurisdiction under Section 11(6).

8. Why Does This Case Matter Today?

This judgment offers practical guidance to businesses, lawyers and arbitration practitioners.

• Prevents jurisdictional disputes: Clear drafting can reduce arguments over which High Court may hear an arbitration-related application.
• Clarifies seat versus venue: A place where hearings occur does not necessarily determine the legal seat.
• Promotes consistent contract drafting: Arbitration clauses should align with provisions dealing with jurisdiction and governing law.
• Reduces procedural delays: Filing an application before the wrong court can lead to additional time and costs.
• Reinforces contractual interpretation: Courts should read connected clauses together to identify the parties’ actual intention.

For businesses negotiating franchise agreements and other commercial contracts, the lesson is straightforward: specify the juridical seat expressly instead of relying on conflicting references to different locations.

9. Case Timeline

Date or Stage	Event
3 August 2023	Arcis Clean Energy and Parshva Innovation entered into a franchise agreement.
25 March 2025	Parshva Innovation proposed a sole arbitrator.
19 April 2025	Arcis Clean Energy rejected the proposal.
11 November 2025	The Delhi High Court appointed an arbitrator under Section 11(6).
12 October 2026	The Supreme Court set aside the Delhi High Court’s order and held that Goa was the juridical seat.

10. Compare It With Landmark Arbitration Decisions

BGS SGS SOMA JV v. NHPC Ltd. (2020)

This decision established an important test for determining when a designated venue can also operate as the juridical seat. The Court in Arcis Clean Energy relied on those principles when examining the agreement’s conflicting references to Delhi and Goa.

Mankastu Impex (P) Ltd. v. Airvisual Ltd. (2020)

This case clarified that the words “place of arbitration” do not, by themselves, settle the question of the juridical seat. Courts must examine the contract’s other clauses and the parties’ intention.

Arif Azim Co. Ltd. v. Micromax Informatics FZE (2024)

The Supreme Court relied on this decision when applying the principles used to distinguish a venue from a seat. It helped frame the question of whether a specified location should be treated as the juridical seat or merely as a place for conducting hearings.

Key distinction: Arcis Clean Energy applies these principles to an agreement that referred to both Delhi and Goa and separately gave Goa courts exclusive jurisdiction.

11. Relevant Legal Provisions

• Section 11(6), Arbitration and Conciliation Act, 1996: Provides a mechanism for approaching the court for appointment of an arbitrator when the agreed appointment procedure fails.
• Section 2(1)(e), Arbitration and Conciliation Act, 1996: Defines “Court” for the purposes of the Act, subject to the provision’s terms and the relevant category of arbitration.
• Section 20, Arbitration and Conciliation Act, 1996: Deals with the place of arbitration chosen by the parties or determined under the statutory framework.

These provisions must be read together with the applicable judicial precedents on the juridical seat and the court’s supervisory jurisdiction.

12. Exam Memory Hack

SEAT = legal supervision. VENUE = physical location.

Remember three points:

1. The juridical seat determines the court with supervisory jurisdiction over the arbitration.
2. A venue does not automatically become the seat.
3. Courts interpret the relevant contractual provisions together to identify the parties’ intention.

13. Possible Exam Questions

Short-answer question: Distinguish between the juridical seat and the venue of arbitration with reference to Arcis Clean Energy Pvt. Ltd. v. Parshva Innovation.

Long-answer question: Explain how courts determine the juridical seat when an arbitration agreement identifies multiple places and contains an exclusive jurisdiction clause.

Problem-based question: An agreement states that arbitration will take place in Delhi, provides that proceedings will be held in Goa, and grants exclusive jurisdiction to competent courts in Goa. Which High Court may exercise jurisdiction over an application under Section 11(6)? Discuss the principles governing seat and venue.

14. Key Legal Terms

• Juridical Seat: The legal home of an arbitration that determines the courts with supervisory jurisdiction.
• Venue: The physical location where arbitral hearings take place.
• Exclusive Jurisdiction: A contractual provision identifying the courts intended to exercise jurisdiction over specified disputes, where legally valid.
• Section 11(6): A provision governing recourse to the court when the agreed procedure for appointing an arbitrator fails.
• Arbitral Tribunal: The sole arbitrator or panel of arbitrators appointed to resolve a dispute.
• Harmonious Construction: Interpreting contractual provisions together so that each clause retains meaning and effect.

15. TARAJU Takeaway

A place named in an arbitration clause does not automatically become the seat.

In Arcis Clean Energy Pvt. Ltd. v. Parshva Innovation, the Supreme Court read the agreement as a whole and concluded that Goa was the juridical seat because the contract required proceedings to be held there and gave Goa courts exclusive jurisdiction.

The judgment reminds lawyers and businesses to draft arbitration clauses carefully. A clear seat designation, consistent jurisdiction provisions and a proper understanding of the seat-versus-venue distinction can prevent avoidable jurisdictional disputes.