What happened

In 2012 Mahanadi Coalfields Ltd. (MCL) tendered earth-moving and transport work at its Kulda open-cast project in Sundargarh district, Odisha. GSCO (Gurmeet Singh and Company) Infrastructure won. The contract had no arbitration clause. It did have jurisdiction language: disputes were to be subject to the District Court (or High Court) “where the work will be executed”, which was Sundargarh.

Disputes followed. GSCO filed writ petitions in the Orissa High Court at Cuttack. On 25 March 2019, recording the parties’ consent, the High Court referred the disputes to a retired judge as sole arbitrator; the Supreme Court describes this as an appointment under section 11(6) of the Arbitration and Conciliation Act, 1996. The appointment order named no seat and no venue. The arbitrator held the hearings at Cuttack and made an award in GSCO’s favour on 25 October 2021.

MCL filed section 34 petitions to set the award aside before the District Judge, Sundargarh, on 8 December 2021. GSCO objected: the seat was Cuttack, so only Cuttack courts could hear the challenge, and anyway the petitions were late. The District Judge rejected the objection. The High Court, on a writ petition, upheld it (20 June 2025). It reasoned that because the High Court sitting at Cuttack had appointed the arbitrator, Cuttack was the seat, and section 42 tied every later application to Cuttack.

On 23 September 2026, the Supreme Court (Sanjay Kumar and Sanjeev Sachdeva JJ.; opinion by Sachdeva J.) reversed: Mahanadi Coalfields Ltd. & Ors. v. M/s GSCO (Gurmeet Singh and Company) Infrastructure Pvt. Ltd., 2026 INSC 1038; 2026 LiveLaw (SC) 978. The section 34 petitions were restored before the District Judge, Sundargarh. (The two citations are not in conflict: one is the Supreme Court’s neutral citation, the other LiveLaw’s.)

The holding in three sentences

1. Where hearings happen does not decide the seat. “While ‘Seat’ determines the Courts exercising supervisory jurisdiction over the arbitration proceedings, ‘Venue’ merely denoted the physical location where the sitting are held.” Cuttack was used “only for the sake of convenience of the Arbitrator”, so “mere conduct of arbitral proceedings could not per se determine the juridical seat” (paras 27–28).

2. Where the appointing court sits does not decide the seat either. “Merely because the seat of the High Court is at Cuttack would not confer jurisdiction on the District or Commercial courts at Cuttack” (para 30).

3. The State-wide rule. A High Court “exercises jurisdiction over the entire State”, so the commercial courts — or district courts where none exists — within its territory can entertain a section 34 petition, “unless there is an agreement of the parties to the contrary or a specific determination of a ‘Seat’ in the order of appointment or any such stipulation/direction by the Court” (para 31).

On limitation, GSCO’s senior counsel conceded the High Court was wrong: the award was dated 25.10.2021 and the petitions were filed on 08.12.2021, inside the three months in section 34(3).

Why BALCO, Indus Mobile and BGS SGS Soma did not help

GSCO relied on the Supreme Court’s seat trilogy — BALCO v. Kaiser Aluminium, (2012) 9 SCC 552; Indus Mobile Distribution v. Datawind Innovations, (2017) 7 SCC 678; and BGS SGS Soma JV v. NHPC Ltd., (2020) 4 SCC 234. The Court said they “do not further the case of the Respondent for the reason that there is no ‘Seat’ expressly designated or consented to by the parties” (para 29).

That is the key distinction. Each of those cases starts from a clause the parties wrote. BGS SGS Soma goes furthest: where a clause names a “venue” and nothing points the other way, that venue is read as the seat, and the seat’s courts get exclusive supervisory jurisdiction. But it still reads the parties’ words. In Mahanadi there were no words — no arbitration clause at all, and a reference order that named no seat. Nothing chose Cuttack except where the High Court and the arbitrator happened to sit.

Where section 42 fits

The High Court’s section 42 reasoning was simple: the first application (the reference) was in Cuttack, so everything else must follow it there. The Supreme Court did not engage with section 42 separately. It removed the premise instead: once Cuttack was not the seat and the appointing court’s location conferred nothing, the section 42 argument had nothing to attach to.

For background: in State of West Bengal v. Associated Contractors, (2015) 1 SCC 32, the Supreme Court held that a section 11 application (then made to the Chief Justice or his designate) falls outside section 42, because the Chief Justice is not a “Court” under section 2(1)(e). After the 2015 amendment, section 11 applications go to “the High Court”, and whether that changes the section 42 analysis has been debated. Mahanadi does not cite Associated Contractors and does not settle that debate.

What it means for drafting and disputes

Name the seat, in those words. “The seat of arbitration shall be ___.” If you also want hearings elsewhere, say that hearings may be held at ___ “as a venue only”. Under section 20(1) the parties are free to agree the place; this judgment shows what happens when they don’t.

Don’t leave it to the forum that appoints. A section 11 appointment is a gateway step. On its own it does not fix the seat. If the parties want certainty in a court-referred arbitration, para 31 points to the answer: ask for “a specific determination of a ‘Seat’ in the order of appointment”.

Check your jurisdiction clause. With no seat, the ordinary rules decide which court hears section 34. MCL’s tender clauses sent disputes to the court where the work was executed, and the Court noted them (paras 23–25). In public-works contracts, that is often the district where the site lies.

Map the commercial courts. The Court relied on an Odisha notification of 13.11.2020 showing no commercial court for Sundargarh, so the District Judge was the right forum. Before filing a section 34 petition, check which commercial court (if any) covers the district.

Don’t let a writ petition decide seat by default. The arbitration here began in a writ court, by consent, on a contract with no arbitration clause. Parties agreeing to arbitrate at a hearing should put the seat on record in the same order.

What the judgment does not decide

• The merits of the award. The section 34 petitions will now be heard in Sundargarh.
• Section 20(2). Absent agreement, the tribunal may determine the place of arbitration. The judgment does not discuss whether the arbitrator made any such determination; it records only that nothing contrary to the convenience explanation was shown.
• The outer edge of para 31. Read literally, para 31 says any commercial or district court in the State could hear a section 34 petition when no seat is chosen. The facts, though, involved the court the contract itself pointed to, where the work was done. Whether para 31 displaces the section 2(1)(e) test — a court that would have had jurisdiction over a suit on the same subject-matter — was not argued in those terms. Expect that question to come back in later cases.
• International commercial arbitration. The case was domestic. The “Court” for international commercial arbitrations is defined differently in section 2(1)(e)(ii).

FAQ (FAQPage schema)

Is the city where hearings are held the seat of arbitration? Not by itself. Hearings held somewhere for convenience make it a venue. The seat is what the parties agree, or what is otherwise determined (Mahanadi, paras 27–28).

If a High Court appoints the arbitrator, is that High Court’s city the seat? No. The Supreme Court held that the appointing High Court’s location does not confer jurisdiction on the courts of that city (para 30).

Which court hears a section 34 challenge if no seat was chosen? A court with jurisdiction under the ordinary rules. In Mahanadi it was the District Judge where the work was executed, which the contract’s jurisdiction clause also pointed to. Para 31 states the rule broadly for courts within the High Court’s territory.

Does BGS SGS Soma make a venue the seat? Where a clause names a venue and nothing points the other way, BGS SGS Soma reads it as the seat. It needs a clause. It did not apply in Mahanadi, where there was none.

How do I avoid this dispute? Write “seat” in the clause. In a court-referred arbitration, ask for the seat to be stated in the appointment order.

Law relied on: Arbitration and Conciliation Act, 1996 — ss. 2(1)(e), 11(6), 20, 34, 42; Mahanadi Coalfields Ltd. & Ors. v. M/s GSCO (Gurmeet Singh and Company) Infrastructure Pvt. Ltd., 2026 INSC 1038, 2026 LiveLaw (SC) 978 (SC, 23.09.2026); Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552; Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd., (2017) 7 SCC 678; BGS SGS Soma JV v. NHPC Ltd., (2020) 4 SCC 234; State of West Bengal v. Associated Contractors, (2015) 1 SCC 32.

This is general legal awareness, not legal advice. Legal outcomes depend on facts, documents, law, forum, evidence, limitation and judicial discretion — no outcome is guaranteed. Consult a qualified advocate on your own facts.

Adv. Prakhar Gupta — enrolled with the Bar Council of Rajasthan, Enrolment No. R/2196/2020. This page shares legal awareness/education only; it is not advertisement or solicitation of work.

Parts of this content (images/voice/summary) were created or edited using AI tools.

The section 34 petitions are pending before the District Judge, Sundargarh. Nothing here comments on the award or its merits.