IMAX CORPORATIONversusM/S E-CITY ENTERTAINMENT (I) PVT. LTD.

                         [2017] 4 S.C.R. 833


                      IMAX CORPORATION                                   A
                                  v.
          MIS E-CITY ENTERTAINMENT (I) PVT. LTD.
                   (Civil Appeal No. 3885 of 2017)
                          MARCH 10, 2017                                 B

          [S. A. BOBDE AND ASHOK BHUSHAN, JJ.]
        Arbitration and Conciliation Act, 1996: s.34 - Petition under,
  maintainability before Indian courts - Jn the instant case, ICC Rules
  were chosen by parties to govern arbitration proceedings - C
  International Court of Arbitration decided that London would be
·juridical seat of arbitration by virtue of Art.14(1) of ICC Rules -
  Held: The parties did not choose the place of arbitration - There
  was however an agreement to have the arbitration conducted
  according to the ICC rules and thus a willingness that the seat of
  arbitration may be outside India - In any case, the parties having D
  agreed to have the seat decided by the ICC and the ICC having
  chosen London after consulting the parties and the parties having
  abided by the decision, it must be held that upon the decision of the
  ICC to hold the arbitration in London, the parties agreed that the
  seat shall be in London for all practical purposes - Therefore, E
  applicability of Part-I of the Act should be excluded- Petition u/s.34
  was not maintainable.
       Allowing the appeal, the Court
       HELD: 1. Clause 14 of the Agreement deals with two
 matters: (i) the laws which will govern the agreement; and (ii) a       F
 provision of settling disputes by arbitration. As regards the first,
 it provides that in case a question arises as to the agreement i.e.
 what the agreement means or what the parties intended, it shall
 be interpreted according to the laws of Singapore and these laws
 will govern the understanding and the acts of the parties. Further,
 in case the parties resort to a court, they shall approach the courts   G
 of Singapore which alone shall adjudicate upon the issue. The
 courts of Singapore will thus adjudicate in relation to any non-
 arbitrable dispute that might arise under the agreement or possibly
 a dispute regarding the correctness or validity of an arbitration
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834            SUPREME COURT REPORTS                      [2017] 4 S.C.R.


A award. It is not necessary to consider whether a challenge to the
  award would lie in Singapore in this case because the award in
  fact was made in London and in any case no party has approached
  the court in Singapore. Secondly, this clause provides that any
  dispute arising out of this agreement or concerning the rights,
B duties or liabilities of the parties shall be settled by arbitration.
  The arbitration shall be pursuant to the ICC Rules of Arbitration.
  In other words, the parties shall invoke the ICC Rules of
  Arbitration in case a dispute arises between them concerning
  their rights, duties or liabilities. The intention is to have the
  dispute settled by and in accordance with the ICC Rules of
C Arbitration. In this sense, the ICC Rules of Arbitration must be
  construed as being read into this clause. [Para 181 [841-D-H;
  842-A-C]
              2. The ICC Rules provide for the entire conduct of
      arbitration from its commencement to the passing of an award.
D     They provide that the arbitration shall be conducted by the court
      i.e. the International Court of Arbitration, appointed by the council
      of the ICC. A party wishing to have recourse to arbitration under
      the rules is required to submit a Request for Arbitration to the
      Secretariat of the ICC along with the information prescribed and
      in particular comments as to the place of arbitration. The ICC
E     Rules clearly stipulate that the seat of arbitration shall be fixed
      by the court. In this case, the appellant had proposed the venue
      of arbitration to be Paris in France. Upon notice being issued,
      the respondent was obliged to file an answer including a comment
      concerning the number of arbitrators and their choice as to the
 F    place of arbitration. The respondent, in their answer stated that
      the venue suggested by the claimant i.e. Paris in France would
      unnecessarily increase the cost of arbitration and therefore
      suggested that Singapore would be the most appropriate and
      convenient venue for the arbitration, vide "Answer to Request for
      Arbitration pursuant to Article 5(1) of the ICC Rules ofArbitration"
G     dated 30.08.2004. The International Court of Arbitration decided
      inter alia that London, United Kingdom will be the juridical seat·
      of the arbitration in view of Article 14(1) of the ICC Rules and,
      therefore, proceeded on the basis of the Part-I of the English
      Arbitration Act, 1996. The parties had agreed in pursuance of
H     the agreement to have the dispute decided in accordance with
  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                      835
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th.e ICC Rules by submitting the dispute to the ICC. The court A
(of the ICC) considered the stand of the parties on the venue for
arbitration and fixed London as the seat of arbitration. [Para 19]
[842-G-H; 843-A-B]
      3. In this case, there is an express choice of the law
governing the contract as a whole i.e. Singaporean Law. There is        B
an express agreement that any arbitration would be governed by
the ICC Rules of Arbitration. The general principle is that, in
the absence of any contradictory indication, it shall be presumed
that the parties have intended that the proper law of contract as
well as the law governing the arbitration agreement is the same
as the law of the country in which the arbitration is agreed to be      C
held. The arbitration clause contemplates an award made in
pursuance to the ICC rules without specifying the applicable law
for the arbitration agreement. It would therefore be appropriate
to hold that the question of validity of the award should be
determined in accordance with the law of the State in which the         D
arbitration proceedings have taken place i.e. the English Law.
Where the parties have not expressly chosen the law governing
the contract as a whole or the arbitration agreement in particular,
the law of the country where the arbitration is agreed to be held
has primacy. Here, an express choice has been made by the
parties regarding the conduct of arbitration, i.e., that a dispute      E
shall be finally settled by arbitration according to the ICC Rules
of Arbitration. The parties have not chosen the place of
arbitration. They have simply chosen the rules that will govern
the arbitration, presumably aware of the provision in the rules
that the place of arbitration will be decided by the ICC vide Article   F
14(1) of the ICC Rules. The ICC having chosen London, leaves
no doubt that the place of arbitration will attract the law of UK in
all matters concerning arbitration. [Paras 20-22] [843-D-E, H;
844-A-D]
      Sakuma Exports Ltd. v. Louis Dreyfus Commodities                  G
      Suisse Sa (2015) 5 SCC 656; Harmony Innovation
      Shipping Ltd. v. Gupta Coal India Ltd. (2015) 9 SCC
      172: [2015) 2 SCR 697; Reliance Industries Ltd. v.
      Union of India (2014) 7 SCC 603 : [20141 6 SCR.456
      - distinguished.
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A       4.1 It is settled law in India that the provisions of Part-I of
  the Arbitration Act would apply to all arbitrations and all
  proceedings relating thereto. On a true construction of Clause
  14 in this case, there is no doubt the parties have agreed to
  exclude Part-I by agreeing that the arbitration would be conducted
B in accordance with the ICC Rules. The parties were undoubtedly
  conscious that the ICC could choose a venue for arbitration
  outside India. That is sufficient to infer that the parties agreed
  to exclude Part-I. The ICC could well have chosen a venue in
  India. The possibility that ICC could have chosen India is not a
  counter indication of this inference. It could also be said that the
C decision to exclude the applicability of Part-I was taken when the
  ICC chose London after consulting the parties. Either way Part-
  I was excluded. The view that it is the law of the country where
  arbitration is held that will govern the arbitration and matters
  related thereto such as a challenge to the award is well entrenched.
D [Paras 27-29] [846-B; 847-A-C]
           Bhatia International v. Bulk Trading S.A. and Am~
           (2002) 4 SCC 105: (2002) 2 SCR 411; Venture Global
           Engg. v. Satyam Computer Services Ltd. (2008) 4 SCC
           190 : [2008) 1 SCR 501; Videocon Industries Limited
           v. Union of India (2011) 6 SCC 161 : (2011) 8 SCR
 E         569; Dozco India (P) Ltd. v. Doosan Infracore Co. Ltd.
           (2011) 6 SCC 179 : [2010) 12 SCR 259; Cauvery
           Coffee Traders v. Horner Resources (International) Co.
           Ltd. (2011) 10 SCC 420 : [20111 12 SCR 473; Union
           of India v. Reliance Industries Ltd. (2015) 10 SCC 213
 F         : [2015) 10 SCR 85; Eitzen Bulk AIS v. Ashapura
           Minechem Ltd. (2016) 11 SCC 508 - relied on.
         4.2 The relationship between the seat of arbitration and
   the law governing arbitration is an integral one. The seat of
   arbitration is defined as the juridical seat of arbitration designated
 G by the parties, or by the arbitral institution or by the arbitrators
   themselves as the case may be. The place of arbitration
   determines the law that will apply to the arbitration and related
   matters like challenges to the award etc. If in pursuance of the
   arbitration agreement, the arbitration took place outside India,
   there is a clear exclusion of Part-I of the Arbitration Act. In the
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  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                    837
                     PVT. LTD.

present case, the parties expressly agreed that the arbitration A
will be conducted according to the ICC Rules of Arbitration and
left the place of arbitration to be chosen by the ICC. The ICC in
fact, chose London as the seat of arbitration after consulting the
parties. The arbitration was held in London without demur from
any of the parties; All the awards i.e. the two partial final awards, B
and the third final award, were made in London and communicated
to the parties. This is a clear case of the exclusion of Part-I. The
High Court committed an error in observing that the seat of
arbitration itself is not a decisive factor to exclude Part-I of the
Arbitration Act. [Paras 30, 31 and 33] [847-F; 898-E-H; 849-A) ·
      National Thermal Power Corporation v. Singer                    c
      Company (1992) 3 SCC 551 : [19921 3 SCR 106 -
      referred to.
      Redfern and Hunter on International Arbitration, Fifth
      Edition - referred to.
                                                                      D
                      Case Law Reference
       c2015) 5 sec 656        distinguished          Para 24
      [2015) 2 SCR 697         distinguished          Para 24
      [2014] 6 SCR 456         distinguished          Para 26
      [1992] 3 SCR 106         referred to            Para 27         E

      [2002) 2 SCR 411         relied on              Para 27
      [2008] 1 SCR 501         relied on              Para 27
      [2011] 8 SCR 569         relied on              Para 27
      (2010) 12 SCR 259        relied on              Para 27         F
      [2011) 12 SCR 473        relied on              Para 27
      (2015) 10 SCR 85         relied on              Para 27
      (2016) 11 sec 508        relied on              Para 27
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3885 .G
of 2017.
     From the Judgment and Order dated 10.06.2013 of the High Court
of Bombay in Notice of Motion No. 2560 of2008 in AP (Lodging) No.
525 of 2008.
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838            SUPREME COURT REPORTS                         [2017] 4 S.C.R.


A            Pallav Shishodia, Sr. Adv., Chirag Joshi, Ghanshyam Joshi, Advs.
      for the Appellant.
           Dr. A. M. Singhvi, Ms. Indu Malhotra, Sr. Advs., Ms. Shyel Trehan,
      Ms. Manjira Das Gupta, Ms. Madhavi Khanna, Ms. Akshita Sachdeva,
      Apoorva Bhumesh, Ms. Liz Mathew, Advs. for the Respondent
B           The Judgment of the Court was delivered by
            S. A. BOBDE, J. 1. Leave granted.
        2. The appellant-Imax Corporation has challenged the interim
  order dated 10.06.2013 passed by the High Court of Judicature at
C Bombay in Notice of Motion No.2560 of2008 in the Arbitration Petition
  (Lodging) No.525 of2008.
          3. By the aforementioned order, the High Court held that the
   petition under Section 34 of the Arbitration and Conciliation Act, 1996
   (for short, "the Arbitration Act") filed by the respondent-MIS E-City
 D Entertainment (I) Pvt. Ltd. against two partial final awards dated
   11.02.2006, 24.08.2007, and third final award dated 27.03.2008 was
   maintainable.
          The appellant had objected to the maintainability of the petition
   under Section 34 of the Arbitration Act on the ground that the arbitration
 E clause excluded the applicability of Part-I which contains the said section.
             4. The only issue before us is whether the petition under Section
      34 of the Arbitration Act is maintainable before a court in India, and in
      this case, the Bombay High Court.
             5. On 28.09.2000, the appellant entered into an agreement with
 F    the respondent for a supply of large format projection systems for cinema
      theatres to be installed in theatres all across India. Clause 14 of the
      agreement contained an arbitration clause which reads as follows:
             "This Agreement shall be governed by and construed
             according to the laws of Singapore, and the parties attorn to
 G           the jurisdiction of the courts of Singapore. Any dispute arising
             out of this master agreement or concerning the rights, duties
             or liabilities of E-City or !max hereunder shall be finally
             settled by arbitration pursuant to the ICC Rules of
             Arbitration. " ·

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  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                          839
             PVT. LTD. [S. A. BOBDE, J.]

       6. On 16.06.2004, the appellant filed a request for arbitration      A
with the ICC, and claimed damages. On 08.10.2004, the ICC i.e. the
chosen arbitral forum fixed London as the place of arbitration i.e. the
juridical seat of arbitration, after consulting the parties.
FIRST PARTIAL FINAL AWARD'
       7. On 11.02.2006, the first partial final award was made in favour   B
of the appellant declaring that the respondent was in breach of the
agreement and therefore liable for damages. The award stated that the
decision on the other issues, including damages/costs would be reserved
for a future award.
       8. The aforementioned declaration was made after observing in        C
the award that the court of the ICC had decided to fix London as the
juridical seat of arbitration in accordance with the powers vested in the
court under Article 14(1) of the ICC Rules. The observation read as
follows:
      "As well be noticed, no provision was made for .a venue for D
      any arbitration contemplated by Clause 14, but subsequently
      the court of the ICC decided on the 81" of October, 2004 to fix
      London as the juridical seat of the arbitration in accordance
      with the powers vested in the court under Article 14 of the
      ICC Rules. Accordingly, this is an arbitration to which Part-I E
      of the English Arbitration Act 1996 applies. "
      9. The appellant filed its statement of damages before the Arbitral
Tribunal. The respondent filed its statement of defence.
       10. On 05.09.2006 the respondent objected that the appellant has
no legal status and the law firm representing them is not authorized to     F
pursue the arbitration. In that application, the respondent stated as
follows:
       'The seat of this arbitration is London. Therefore, English
       law determines the effect of any want of capacity suffered by
       "/max Ltd" under the Canadian law as a result of its                 G
       amalgamation into /max Corporation with effect from l''
       January, 2001."
SECOND PARTIAL FINAL AWARD
       11. On 24.08.2007, the Arbitral Tribunal passed the second partial
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840            SUPREME COURT REPORTS                       [2017] 4 S.C.R.


A award rejecting the above objection filed by the respondent. By th.is
  award, the tribunal determined the quantum of damages payable to the
  appellant. This award was also made in London, the juridical seat of
  this arbitration. A sum of$9,406,148.31 was awarded to the appellant.
            THIRD FINAL AWARD
B            12. The Arbitral Tribunal passed a final award on 27.03.2008 on
      the issue of interest and costs. A sum of $1,118,558.54 by way of
      interest and a further sum of $2,512.60 per day from 01.10.2007 until
      the payment of the award was awarded in favour of the appellant. Sums
      of $400,000 and $384, 789 .21 by way of costs of arbitration fixed by
 c    the ICC and costs by way of attorney's fees, expert fees and related
      expenses were also directed to be paid. Final award dated 27.03.2008
      was received by the respondent on 01.04.2008.
          The final award on the issues of interest and costs was
   amalgamated with the earlier awards; both of which were incorporated
 D by reference into itself. The third final award also stated that the place
   of arbitration is London.
         PETITION UNDER SECTION 34 BEFORE THE
      BOMBAY HIGH COURT
          13. On 21.07.2008, the respondent challenged the aforesaid
 E awards under Section 34 of the Arbitration Act before the Bombay High
   Court in India after a period of more than two years from the first
   partial award, more than one year from the second partial award and
   a period of 3 months, 24 days from the final award.
            14. The learned Single Judge allowed the notice of motion on
 F    the condonation of delay and held that the petition under Section 34
      was maintainable before the Bombay High Court.
            Hence, this appeal.
          15. The only question that arises for consideration before us is
 G whether the challenge to the award made by the respondent under
   Section 34 of the Arbitration Act is maintainable before a court in India.
   Clearly, if the answer is in the negative it'is not necessary to decide
   the question of delay. Thus, we make it clear that we are not deciding
   where else in the world a challenge to the award would be maintainable.
             16. Dr. A.M. Singhvi, learned senior counsel for the respondent
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  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                           841
             PVT. LTD. [S. A. BOBDE, J.]

relied on Clause VIII (2) of the Request for Arbitration dated 16.06.2004 A
wherein the petitioner stated as follows:
      "VIII Place o(Arbitration. Law and Language
      (2) Section 14 of the letter Agreement is silent as to the place
      of the arbitration. Claimant believes that Paris and France
      are suitable places for arbitration to take place, indeed, this        B
      is the venue chosen by the ICC for the related EML Arbitration
      and the claimant believes that this arbitration should be
      consolidated along with the pending EML Arbitration. Paris
      is roughly equal distant from both parties. "
       17. The above submission was made in response to Mr. Pallav C
Shisodia's argument, learned senior counsel for the appellant, that the
respondent had in fact stated in its petition under Section 34 of the
Arbitration Act that "the seat of arbitration was in London". Also in
the counter affidavit before this Court it was submitted that the seat of
arbitration being London in no way precludes the respondent from D
challenging the awards under Section 34 of the Act.
       Having noted the above submissions and statements made by the
parties, we propose to decide the question on the construction of Clause
14 and the law governing such challenges.
      CLAUSE 14: THE ARBITRATION CLAUSE                                      E
      18. Clause 14 of the Agreement deals with two matters:
          (i) the laws which will govern the agreement; and
          (ii) a provision of settling disputes by arbitration.
        As regards the first, it provides that in case a question arises as to F
the agreement i.e. what the agreement means or what the parties intended,
it shall be interpreted according to the laws of Singapore and these laws
will govern the understanding and the acts of the parties. Further, in
case the parties resort to a court, they shall approach the courts of
Singapore which alone shall adjucicate upon the issue. The courts of G
Singapore will thus adjudicate in relation to any non-arbitrable dispute
that might arise under the agreement or possibly a dispute regarding the
correctness or validity of an arbitration award. It is not necessary to
 consider whether a challenge to the award would lie in Singapore in this
case because the award in fact was made in London and in any case no
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842            SUPREME COURT REPORTS                          [2017] 4 S.C.R.


A party has approached the court in Singapore.
         Secondly, this clause provides that any dispute arising out of this
  agreement or concerning the rights, duties or liabilities of the parties
  shall be settled by arbitration. The arbitration shall be pursuant to the
  ICC Rules of Arbitration. In other words, the parties shall invoke the
B ICC Rules of Arbitration in case a dispute arises between them
  concerning their rights, duties or liabilities. The intention is to have the
  dispute settled by and in accordance with the ICC Rules of Arbitration.
  In this sense, the ICC Rules of Arbitration must be construed as being
  read into this clause.
C           THE ICC RULES
           19. The ICC Rules provide for the entire conduct of arbitration
    from its commencement to the passing of an award. They provide that
    the arbitration shall be conducted by the court i.e. the International Court
    of Arbitration, appointed by the council of the ICC. A party wishing to
· D have recourse to arbitration under the rules is required to submit a Request
    for Arbitration to the Secretariat of the ICC along with the information
    prescribed and in particular comments as to the place of arbitration. The
    ICC Rules clearly stipulate that the seat of arbitration shall be fixed by
    the court, in the following words:-

 E          "]. The place of the arbitration shall be fixed by th'! Court
               unless agreedupon by the parties.
              2. The Arbitral Tribunal may, after consultation with the
                parties, conduct hearings and meetings at any location it
                considers appropriate unless otherwise agreed by the
 F
                parties.
            3. The Arbitral Tribunal may deliberate at any location it
               considers appropriate. "
            In this case, the appellant had proposed the venue of arbitration
   to be Paris in France. Upon notice being issued, the respondent was
 G obliged to file an answer including a comment concerning the number of
   arbitrators and their choice a.s to the place of arbitration.
             The respondent, in their answer stated that the venue suggested
      by the claimant i.e. Paris in France would unnecessarily increase the
      cost of arbitration and therefore suggested that Singapore would be the
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      IMAX CORPORATION v. M/S E-CITY ENTERTAINMENT (I)                          843
                 PVT. LTD. [S. A. BOBDE, J.]

most appropriate and convenient venue for the arbitration, vide "Answer A
 to Request for Arbitration pursuant to Article 5(1) of the ICC Rules
 of Arbitration" dated 30.08.2004 ..
          The International Court of Arbitration decided inter alia that
  London, Unitt'.d Kingdom will be the juridical seat of the arbitration in
. view of Article 14(1) of the ICC Rules and, therefore, proceeded on the       B
  basis of the Part-I of the English Arbitration Act, 1996.
          What is significant and needs to be pointed out is that the parties
 had agreed in pursuance of the agreement to have the dispute decided in
 accordance with the ICC Rules by submitting the dispute to the ICC.
 The court (of the ICC) considered the stand of the parties on the venue        c
 for arbitration and fixed London as the seat of arbitration.
           INTENTION OF THE PARTIES TO EXCLUDE PART-I
       20. In this case, there is an express choice of the law governing
 the contract as a whole i.e. Singaporean Law.
                                                                                D
        There is an express agreement that any arbitration would be
 governed by the ICC Rules ofArbitration. The general principle is that,
 in the absence of any contradictory indication, it shall be presumed that
 the parties have intended that the proper law of contract as well as the
 law governing the arbitration agreement is the same as the law of the
 country in which the arbitration is agreed to be held. .                        E
       21. lt would be apposite to refer to a case decided by the Supreme
                                                                                -~
 Court of Sweden from a passage in Redfern and Hunter1 • Quoting the
 Supreme Court of Sweden it is stated that:-
           " ... no particular provision concerning the applicable
                                                                                 F
           law for the arbitration agreement itself was indicated
           [by the parties]. In such circumstances the issue of the
           validity of the arbitration clause should be determined
           in accordance with the law of the state wh)ch the
           arbitration proceedings have taken place, that is to say,
           Swedish Law. "                                                        G
       In the present case, the arbitration clause contemplates an award
 made in pursuance to the ICC rules without specifying the applicable
 law for the arbitration agreement. It would therefore be appropriate to
  1
      Redfern and Hunter on International Arbitration, Fifth Edition
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844            SUPREME COURT REPORTS                          [2017] 4 S.C.R.


A hold that the question of validity of the award should be determined in
  accordance with the law of the state in which the arbitration proceedings
  have .taken place i.e. the English Law. Though for the purposes of this
  decision we would only hold that the conduct of the parties exclude the
  applicability of Part-I.         ·
B            In other words, where the parties have not expressly chosen the
      law governing the contract as a whole or the arbitration agreement in
      particular, the law of the country where the arbitration is agreed to be
      held has primacy.
           22. Here, an express choice has been made by the parties
c regarding the conduct of arbitration, i.e., that a dispute shall be finally
  settled by arbitration according to the ICC Rules of Arbitration. The
  parties have not chosen the place of arbitration. They have simply chosen
  the rules that will govern the arbitration, presumably aware of the provision
  in the rules that the place of arbitration will be decided by the ICC vi de
  Article 14(1) of the ICC Rules. The ICC having chosen London,
D leaves no doubt that the place of arbitration will attract the law of UK in
  all matters concerning arbitration.
          23. The arbitration clause appears consistent with Section 2(7) of
   the Arbitration Act, 1996 which recognizes the freedom to authorize any
   person including an institution to determine an issue such as the choice
 E of the place of arbitration.
            24. Dr. Singhvi rightly submitted that the decisions of the court in
      Sakuma Exports Ltd. vs. Louis Dreyfus Commodities Suisse Sa 2,
      Harmony Innovation Shipping Ltd. vs. Gupta Coal India Ltd. 3, and
      Reliance Industries Ltd. vs. Union of lndia4 do not help the appellant
 Fin view of the main difference between the abovementioned cases and
  the present one i.e. in all these cases, the parties had specifically agreed
  that the seat of arbitration will be London. The arbitration clause in
  these cases itself specified the seat to be at London. In Reliance
  Industries Ltd. (supra), the agreement that the seat of arbitration would
G be London was incorporated in the final partial award.
           However~ as we shall see the agreement to have the arbitration
      conducted by the ICC and the choice of London as the seat ofarbitration
      2
        (2015) 5 sec 656
      '(2015) 9 sec 112
H     • (2014) 7 sec 603
  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                               845
             PVT. LTD. [S. A. BOBDE, J.]

has made no material difference for the purpose of exclusion of Part-I.          A
        The relevant clause in these cases was undoubtedly different in
that the seat of arbitration outside India was specified in the clause itself.
However, we have found that the relevant clause in the present case
had the effect of an agreement to have the seat of the arbitration outside
India, as chosen by the ICC and agreed to by the parties.                        B
       25. We find that in the pre~ent case, the seat of arbitration has not
been specified at all in the arbitration clause. There is however an
agreement to have the arbitration conducted according to the ICC rules
and thus a willingness that the seat of arbitration may be outside India.
In any case, the parties having agreed to have the seat decided by the           c
ICC and the ICC having chosen London after consulting the parties and
the parties having abided by the decision, it must be held that upon the
decision of the ICC to hold the arbitration in London, the parties aereed
that the seat shall be in London for all practical purposes. Therefore,
there is an agreement that the arbitration shall be held in London and
thus Part-I of the Act should be excluded.                                       D
      26. The construction that-the parties agreed to exclude the
applicability of Part-I of the Act and generally to haw the entire agreement
governed not according to Indian law is also apparent from the express
provision that:
                                                                                 E
        "This agreement shall be governed by and construed
       according to laws of Singapore and parties attorn to
       jurisdiction of the Courts of Singapore".
     In para 25 of National Thermal Power Corporation vs. Singer
 Company 5 , this Court held:
                                                                                  F
       "On the other hand, where the proper law of the contract
       is expressly chosen by the parties, as in the present case,
       such law must, in the absence of an unmistakable
       intention to the contrary, govern the arbitration
       agreement which, though collateral or ancillary to the
                                                                                  G
       main contract, is nevertheless a part of such contract".
        This principle is again reiterated in Sakuma Exports Ltd. (supra).
        This stipulation expressly excludes Part-I of the Act because it
 • (1992) 3 sec 551
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846             SUPREME COURT REPORTS                        [2017] 4 S.C.R.


A governs both the principal agreement as well as the accompanying
  arbitration agreement.
             NON- APPLICABILITY OF PART-I
         27. It is settled law in India that the provisions of Part-I of the
  Arbitration Act would apply to all arbitrations and all proceedings relating
B thereto. In Bhatia International vs. Bulk Trading S.A. and A111: 6 , this
  Court observed:-
             "32 . ....... Where such arbitration is held in India the
            provisions of Part I would compulsorily apply and
            parties are free to deviate only to the extent permitted
c           by the derogable provisions of Part I. In cases of
            international commercial arbitrations held out of India
            provisions of Part I would apply unless the parties by
            agreement, express or implied, exclude all or any of its
            provisions. In that case the laws or niles chosen by the
D           parties would prevail. Any provision, in Part I, which is
            contrary to or excluded by that law or rules will not
            apply."
        This view has been followed in several cases, See Venture Global
  Engg. vs. Satyam Computer Services Ltd. 7, Videocon Industries
E Limited vs. Union of India 8, Dozco India (P) Ltd. vs. Doosan
  lnfracore Co. Ltd. 9, Cauvery Coffee Traders vs. Horner Resources
  (International) Co. Ltd. w, Reliance Industries Ltd. (supra) and
      Sakuma Exports Ltd. (supra), Union of India vs. Reliance Industries
      Ltd. 11 , Harmony Innovation Shipping Ltd. (supra) and Eitzen Bulk
      AIS vs. Ashapura Minechem Ltd. 12
F
              The relevant clause in these cases w~_s undoubtedly different in
      that, the seat of arbitration outside India was specified in the clause
      itself. However, we have found that the clause in this case had the
      effect of an agreement to have the seat of arbitration outside India, as
      chosen by the ICC, and as agreed to by the parties.
G      • c2002i 4 sec 105
       1
         c2008) 4 sec 190
       '(2011)6SCC 161
       'c2011) 6 sec 119
      " c2011i 10 sec 420
      11
         c2015) 10 sec 213
H
      12
          c2016) 11 sec so8
  IMAX CORPORATION v. M/S E-CITY ENTERTAINMENT (I)                              847
             PVT. LTD. [S. A. BOBDE, J.]

       28. On a true construction of Clause 14 in this case, there is no        A
doubt the parties have agreed to exclude Part-I by agreeing that the
arbitration would be conducted in accordance with the ICC Rules. The
parties were undoubtedly conscious that the ICC could choose a venue
for arbitration outside India. That in our view is sufficient to infer that
the parties agreed to exclude Part-I. The ICC could well have chosen a          B
venue in India. The possibility that ICC could have chosen India is not a
counter indication of this inference. It could also be said that the decision
to exclude the applicability of Part-I was taken when the ICC chose
London after consulting the parties. Either way Part-I was excluded.
       29. The view that it is the law of the country where arbitration is
held that will govern the arbitration and matters related thereto such as       C
a challenge to the award is well entrenched. In Dozco India (P) Ltd.
(supra), this Court observed:-
        "In the absence of express agreement, there is a strong
       primafacie presumption that the parties intend the curial
       law to be the law of the 'seat' of the arbitration i.e. the              D
       place at which the arbitration is to be conducted. on
       the ground that that is the country most closely connected
       with the proceedings. So in order to determine the curial
       law in the absence of an express choice by the parties
       it is first necessary to determine the seat of the                       E
       arbitration, by construing the agreement to arbitrate."
        30. The relationship between the seat of arbitration and the law
governing arbitration is an integral one. The seat of arbitration is defined
as the juridical seat of arbitration designated by the parties, or by the
arbitral institution or by the arbitrators themselves as the case may be.       F
It is pertinent to refer to the following passage from Redfern and Hunter
(supra):-
       "This introduction tries to make clear, the place or seat of the
       arbitration is not merely a matter of geography. It is the
       territorial link between the arbitration itself and the law of G
       the place in which that arbitration is legally situated:
           When one says that London, Paris or Geneva is the place
           of arbitration, one does not refer solely to a geographical


                                                                                H
848             SUPREME COURT REPORTS                           [2017) 4 S.C.R.


A              location. One means that the arbitration is conducted
               within the framework of the law of arbitration of England,
               France or Switzerland or, to use an English expression,
               under the curial law of the relevant country. The
               geographical place of arbitration is the factual connecting
               factor between that arbitration law and the arbitration
B
               proper, considered as a nexus of contractual and
               procedural rights and obligations between the parties and
               the arbitrators.
            The seat of arbitration is thus intended to be its centre of
            gravity."
c
           Further, in the same work on International Arbitration by Redfern
      and Hunter (supra), the following passage emphasizes the connection
      between the lex arbitri and lex fori:-
            "Parties may well choose a particular place of arbitration
D           precisely because its lex arbitri is one which they find
            attractive. Nevertheless, once a place of arbitration has been
            chosen, it brings with it its own law. If that law contains
            provisions that are mandatory so far as arbitration are
            concerned, those provisions must be obeyed. It is not o matter
            of choice any more than the notional motorist is free to choose
 E          which local traffic laws to obey and which to disregard. "
             Thus, it is clear that the place of arbitration determines the law
      that will apply to the arbitration and related matters like challenges to the
      award etc, see Eitzen Bulk A/S (supra).

 F
             31. The significant determinant in each case is the agreement of
      the parties as to the place of arbitration and where in fact the arbitration
      took place.
          If in pursuance of the arbitration agreement, the arbitration took
   place outside India, there is a clear exclusion of Part-I of the Arbitration
 G Act. In the present case, the parties expressly agreed that the arbitration
   will be conducted according to the ICC Rules of Arbitration and left the
   place of arbitration to be chosen by the ICC. The ICC in fact, chose
   London as the seat of arbitration after consulting the parties. The
   arbitration was held in London without demur from any of the parties.
   All the awards i.e. the two partial final awards, and the third final award,
H
  IMAX CORPORATION v. MIS E-CITY ENTERTAINMENT (I)                              849
             PVT. LTD. [S. A. BOBDE, J.]

were made in London and communicated to the parties. We find that A
this is a clear case of the exclusion of Part-I vide Eitzen Bulk AIS
(supra}, and the decisions referred to and followed therein.
       32. The respondent contends before us that Part-I of the award
was applicable, however they themselves stated the place of arbitration
to be London.                                                                   B
       It is pertinent to reproduce the relevant portion in the respondent's
application before the ICC while objecting to the authority of the law
firms representing the appellant. It stated:-
        "The seat of this arbitration is London. "
                                                                                c
      Therefore, the two reasons for Part-I not being applicable are as
follows:-
       (i) Parties agreed that the seat maybe outside India as may be
fixed by the ICC; and
      (ii) It was admitted that the seat of arbitration was London and          D
the award was made there.
       Therefore, there is no doubt that Part-I has no application because
the parties chose and agreed to the arbitration being conducted outside
India and the arbitration was in fact held outside India.
       33. In view of the foregoing observations, we find that the High         E
Court committed an error in observing that the seat of arbitration itself is
not a decisive factor to exclude Part-I of the Arbitration Act. We therefore
set aside the judgment of the High Court and dismiss the petition filed by
the respondent under Section 34 of the Arbitration Act before the Bombay
High Court.                                                                     F
       34. In the result the appeal is allowed with no order to costs.


Devika Gujral                                                 Appeal allowed.