Source: Delhi High Court 

Why in News? 

A bench of Justice Manoj Kumar Ohri held that writ petition filed cannot be construed as earlier application under Section 42 of the Arbitration and Conciliation Act, 1996. 

• The Delhi High Court held this in the case of Hariram & Ors v. National Highway Authority of India (2025). 

What was the Background of Hariram & Ors v. National Highway Authority of India (2025) Case?   

• The petitioners filed a petition under Section 34 of the Arbitration and Conciliation Act, 1996 (A & C Act), challenging an award dated 16th October 2020, passed by the District Collector, Division Meerut, District Baghpat, Uttar Pradesh. 
• The Central Government had issued a notification on July 28, 2006, to acquire land from Baghpat Division to Baghpat District, Uttar Pradesh under Section 3A (1) of the National Highways Act. 
• Some portions of land were compulsorily acquired, while for other portions, possession was taken without acquisition via a notification dated 8th February 2007. 
• The petitioners initially approached the Delhi High Court through a Writ Petition, seeking compensation for their acquired land. 
• The Delhi High Court disposed of the writ petition on 27th November 2018, directing the competent authority to disburse compensation to the petitioners within six months. 
• The petitioners received the original land compensation as per the market value of 2006 through an order dated 27th May 2019, passed by the District Collector, Bhagpat, U.P. 
• Unsatisfied with the compensation amount, the petitioners filed suit before the District Collector-Division Meerut under Sections 3G (5) and 3G (7) of the National Highway Act, seeking enhanced compensation. 
• The suit was dismissed via the impugned judgment dated 16th October 2020. 
• The respondents raised a preliminary objection regarding the Delhi High Court's territorial jurisdiction to entertain the petition under Section 34 of the Arbitration Act. 
• The Delhi High Court dismissed the petition for lack of territorial jurisdiction, ruling that the competent court under whose jurisdiction Baghpat falls would have jurisdiction to entertain the petition. 

What were the Court’s Observations? 

• The Court defined what constitutes a "Court" under the Arbitration and Conciliation Act, 1996, as the principal Civil Court having jurisdiction to decide the subject matter of arbitration if it had been the subject matter of a suit. 
• The Court determined that territorial jurisdiction in arbitration matters lies with the court within whose jurisdiction the subject matter of the suit is situated, as well as the courts within whose jurisdiction the arbitration is conducted. 
• The Court established that the designation of an arbitration seat is equivalent to an exclusive jurisdiction clause, following the precedents set in BALCO v. Kaiser Aluminium Technical Services Inc. and other cases. 
• The Court ruled that a writ petition cannot be construed as an "earlier application" under Section 42 of the Arbitration Act for the purpose of determining jurisdiction. 
• The Court clarified that Section 42 of the Arbitration Act applies only to applications made under Part I of the Act if they are made to a court as defined in the Act. 
• The Court confirmed that the subject matter of arbitration should not be equated with the subject matter of a suit, as the former relates to proceedings under Part I of the Arbitration Act. 
• The Court held that the purpose of Section 2(1)(e) is to identify courts with supervisory control over arbitration proceedings, which refers to the court of the seat of arbitration. 
• The Court found that the legislature intentionally gave jurisdiction to two courts: the court where the cause of action arose and the court where arbitration takes place. 
• The Court ruled that since Baghpat was the agreed seat of arbitration, the land in question was located outside Delhi, and the impugned award was passed in Baghpat, UP, the Delhi High Court lacked territorial jurisdiction in this case. 
• The Court concluded that the competent court under whose jurisdiction Baghpat falls has the jurisdiction to entertain a petition under Section 34 of the Arbitration and Conciliation Act, 1996. 

What is Section 42 of the A & C Act? 

About: 

• The Section envisions a situation where, if an application under Part I of the A&C Act has already been made to a Court, that same Court is entrusted with the jurisdiction to deal with all subsequent applications arising out of that agreement and arbitral proceedings and other Courts are barred from entertaining such applications. 
• Section 42 is meant to avoid conflicts in the jurisdiction of courts by placing the supervisory jurisdiction over all arbitral proceedings in connection with the arbitration in one court exclusively.

Constituents:

• Section 42 of the Arbitration and Conciliation Act, 1996 commences with a non obstante clause ("Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force"), which renders it overriding in effect and gives it primacy over any other conflicting provisions. 
• The provision establishes exclusive jurisdictional competence in the court where the first application under Part I of the Act has been filed with respect to an arbitration agreement. 
• Such court of first instance shall retain exclusive jurisdiction over all subsequent applications arising out of the same arbitration agreement and the proceedings thereto. 
• The provision operates as a complete ouster of jurisdiction of all other courts, once jurisdiction has been properly invoked in accordance with the section. 
• For the application of Section 42, the initial application must qualify as one made "under this Part" (Part I of the Act) and must be presented before a "Court" as defined under Section 2(1)(e) of the Act.