1

2026:CGHC:9189-DB

The date when

the judgment is

reserved

The date when

the judgment is

pronounced

The date when the

judgment is uploaded on

the website

Operative Full

31.01.2026 23.02.2026 -- 23.02.2026

AFR

HIGH COURT OF CHHATTISGARH, BILASPUR

ARBA No. 42 of 2023

 State of Chhattisgarh Through Secretary, Public Works

Department, Represented By Project Manager, ADB Project,

Mahanadi Bhawan, Mantralaya, Naya Raipur, Chhattisgarh.

... Appellant

versus

SMEC International (Wrongly Mentioned In The Cause Title

As Intercontinental) Pty. Ltd. S-559, First Floor, Rear Side,

Greater Kailash -2, New Delhi - 110001

... Respondent

For Appellant :Mr. Anand Dadariya, Dy. Advocate General

with Mr. Avinash Singh, Govt. Advocate.

For Respondent :Anmol Singh, Advocate on behalf of Mr.

Prakash Tiwari, Advocate.

2

D.B. : Hon'ble Smt. Justice Rajani Dubey &

Hon’ble Shri Justice Radhakishan Agrawal

(CAV Order)

Per Rajani Dubey, J

1.The Appellant – State filed this arbitration appeal under

Section 37 of the Arbitration and Conciliation Act, 1966 (for

short ‘the Act, 1966’) read with Section 13 of the

Commercial Courts, Commercial Court Act, 2015 (for short

“the Act of 2015”) against order dated 11.07.2023 passed by

the learned Commercial Court (District Level), Naya Raipur

in MJC No.23/2022, whereby the application preferred by

the appellant herein under Section 34 against the arbitral

award dated 18.07.2022 passed by the learned Sole

Arbitrator was challenged and the learned Trial Court

returned the original petition with documents holding that

the learned Commercial Court has no jurisdiction to decide

the case under Section 34 of the Act, 1966.

2.Brief facts of the case are that the applicant and a joint

venture comprising SMEC India Pty. Limited and SMEC

International Private Limited had entered into a contract for

providing consultancy services in relation to the project of

construction, supervision, rehabilitation, and up-gradation of

Group ‘A’ Roads in Raipur. The total contract value was Rs.

3

25,06,90,736/- and USD 3,16,822/-, inclusive of service tax

at the then prevailing rate of 13.36% on the quoted rates of

items. The agreement between the parties was executed on

03.03.2015. Subsequently, a dispute arose between the

parties with regard to payment of service tax and Goods

and Services Tax (GST) by the respondent and its

reimbursement by the applicant. According to the

respondent, under the terms and conditions of the contract

agreement, they were entitled to reimbursement of the

service tax and GST paid by them, and such reimbursement

was contractually payable by the applicant. However, the

applicant denied its liability to reimburse the said taxes,

which led to the emergence of disputes between the parties.

3.In terms of the arbitration clause contained in the

agreement, the respondent, SMEC International Private

Limited, filed an application under Section 11(6) of the Act,

1996 before the this High Court seeking appointment of an

Arbitrator. The High Court then allowed the said application

and appointed a Sole Arbitrator for adjudication of the

claims and settlement of disputes between the parties.

Before the learned Sole Arbitrator, the respondents filed

their statement of claim and the appellant filed its statement

of defence. Upon conclusion of the arbitral proceedings, the

learned Sole Arbitrator passed a final award dated

4

18.07.2022.

4.Being aggrieved by the said arbitral award, the appellant

preferred an application under Section 34 of the Act, 1996

before the learned Commercial Court (District Level) at

District Raipur. The said application was registered as MJC

No. 23/2022 and proceedings commenced on 31.10.2022.

After receipt of the arbitral record, the matter was fixed for

final hearing. Written submissions were filed by both parties,

oral arguments were heard, and the matter was ultimately

fixed for final orders on 11.07.2023. During the entire

pendency of the proceedings before the learned

Commercial Court, neither party raised any objection with

respect to the jurisdiction of the said Court. However, the

learned Commercial Court, by order dated 11.07.2023, held

that in view of the provisions of Sections 2(e) and 2(f) of the

Act, 1996, it lacked jurisdiction to entertain the application

under Section 34. The learned Commercial Court observed

that the matter fell within the ambit of “International

Commercial Arbitration” and, therefore, the arbitral award

could be challenged only before the Hon’ble High Court

under Section 34 of the Act. It was further held that the

Commercial Court has jurisdiction to entertain applications

under Section 34 only in cases arising out of domestic

arbitration proceedings.

5

5.Learned State counsel appearing for the State/appellant

submits that the learned Commercial Court gravely erred in

holding that it lacked jurisdiction to decide the application

under Section 34 of the Arbitration and Conciliation Act,

1996 on merits. The finding on jurisdiction is wholly

unsustainable in law and contrary to the scheme of the Act.

The learned Commercial Court misread and misinterpreted

the provisions of Sections 2(e) and 2(f) of the Act, 1996

while concluding that it was incompetent to entertain and

decide the application under Section 34. The interpretation

adopted by the learned Court is erroneous and contrary to

the statutory framework. Learned counsel further submits

that the respondent had invoked the jurisdiction of the High

Court under Section 11(6) of the Act seeking appointment of

an Arbitrator. The High Court, upon consideration of the

application, appointed a Sole Arbitrator for adjudication of

the disputes between the parties. It is contended that the

dispute in question arose between the appellant, an entity

incorporated and operating in India, and a Joint Venture of

the respondent, out of which at least one constituent entity

is incorporated in India and carrying on business within

Indian territory. For all practical purposes, the contract was

executed and performed within India between entities

operating in India. Therefore, the arbitration in question

6

could not have been treated as an International Commercial

Arbitration within the meaning of Section 2(f) of the Act, but

was in the nature of a domestic arbitration. Learned counsel

also submits that while determining the issue of jurisdiction,

the learned Commercial Court, by holding that the arbitral

award was squarely covered under the definition of

“International Commercial Arbitration” under Section 2(f),

has indirectly rendered a finding contrary to the position

implicit in the order of the High Court appointing the Sole

Arbitrator. The appointment of the Sole Arbitrator by the

High Court under Section 11(6) proceeded on the premise

of maintainability in accordance with law, and the learned

Commercial Court could not have adopted a view

inconsistent with the judicial determination already made. It

is submitted that the observations and findings recorded by

the learned Commercial Court run contrary to the decision

rendered by the High Court in the arbitration application and

are legally unsustainable. On this ground alone, the

impugned order deserves to be set aside.

6.Learned counsel further contended that the action of the

learned Commercial Court in declining to decide the

application under Section 34 on merits and returning the

same to the appellant is unjust, unfair, and the result of a

patent misreading of Sections 2(e) and 2(f) of the Act, 1996.

7

The approach adopted defeats the object of expeditious

adjudication contemplated under the Act. Lastly, learned

counsel submits that at this stage the appellant is not

pressing or raising any grounds on the merits of the arbitral

award, inasmuch as the merits have not yet been

adjudicated. It is contended that the application under

Section 34 deserves to be decided on merits by the

competent Court, which, according to the appellant, is the

learned Commercial Court at the District Level, Raipur.

Reliance has been placed on the decision of Hon’ble

Apex Court in the matter of Daryao and Others. Vs. State

of U.P. and Others and other connected matter reported

in 1961 SCC OnLine SC 21 : (1962) 1 SCR 574 : (1962) 1

SCJ 702 : AIR 1961 SC 1457.

7.Learned counsel for the respondent, at the outset, raises a

preliminary objection to the maintainability of the present

appeal. It is submitted that the impugned order passed by

the learned Commercial Court merely returns the

application filed under Section 34 of the Act, 1996 for

presentation before the competent Court, having recorded

lack of jurisdiction. Such an order, it is contended, does not

fall within the limited categories of appealable orders

enumerated under Section 37 of the Act. Learned counsel

submits that Section 37 of the Act exhaustively specifies the

8

orders from which an appeal shall lie, and expressly

restricts appeals to those categories alone. An appeal under

Section 37(1)(c) lies only against an order “setting aside or

refusing to set aside an arbitral award” under Section 34.

The impugned order, however, does not adjudicate upon

any ground under Section 34(2) of the Act; it neither sets

aside the award nor refuses to set it aside. It is purely

jurisdictional in character. Therefore, it falls outside the

ambit of Section 37. It is further submitted that Section 13 of

the Act, 2015 merely regulates the forum and procedure for

filing appeals that are otherwise maintainable under

substantive law. Section 13 does not create any

independent right of appeal nor does it enlarge the scope of

appealability beyond what is expressly provided under

Section 37 of the Act. The right of appeal must be expressly

conferred; where the statute is silent, no appeal lies.

Consequently, the appellant’s reliance on “Section 37 read

with Section 13 of the Act of 2015” is misconceived and

untenable in law.

8.Learned counsel further submits that the impugned order is

akin to an order under Order VII Rule 10 of the Code of Civil

Procedure, 1908, whereby a plaint is returned for

presentation before the proper Court. Such an order

preserves the lis for adjudication before the competent

9

forum and does not determine any substantive rights of the

parties. It is pre-adjudicatory and procedural in nature and,

therefore, cannot be equated with an order under Section

34 refusing to set aside the award. On the issue of

jurisdiction, learned counsel submits that Section 2(1)(f) of

the Act, 1996 defines “International Commercial Arbitration”

(ICA) to include an arbitration where at least one party is a

body corporate incorporated outside India. Section 2(1)(e)

(ii) further provides that in the case of an ICA seated in

India, the “Court” having jurisdiction is the High Court

exercising ordinary original civil jurisdiction, or, as the case

may be, the High Court having appellate jurisdiction over

subordinate courts. It is submitted that the arbitral record

consistently identifies the claimant as SMEC International

Pty. Ltd., a body corporate incorporated outside India,

though having office and operations in India. The mere fact

that the said entity entered into a joint venture arrangement

with an Indian company for execution of the project does not

alter its foreign-incorporated status. Under Section 2(1)(f)(ii)

of the Act, 1966 the presence of even one foreign-

incorporated party renders the arbitration an International

Commercial Arbitration.

9.Learned counsel also submits that the learned Sole

Arbitrator, after considering the joint venture structure and

10

the identities of the contracting parties, proceeded on the

basis that SMEC International Pty. Ltd. is a foreign-

incorporated body corporate and adjudicated the dispute on

merits accordingly. The Commercial Court, upon examining

the statutory definitions under Sections 2(1)(e) and 2(1)(f),

rightly concluded that the arbitration was an International

Commercial Arbitration and that it lacked subject-matter

jurisdiction to entertain the application under Section 34 of

the Act 1996.

10.In support of the above proposition, learned counsel places

reliance upon the judgment of the Hon’ble Supreme Court of

India in Amway India Enterprises Pvt. Ltd. v.

Ravindranath Rao Sindhia and Anr., (2021) 8 SCC 465,

wherein it has been categorically held that if even one party

to the arbitration agreement is a body corporate

incorporated outside India, the arbitration assumes the

character of an International Commercial Arbitration,

notwithstanding the fact that such foreign entity may carry

on business in India through an Indian office or operational

arrangement. It is thus submitted that the classification of

the present arbitration as ICA is automatic and statutory.

11.Learned counsel further submits that once the arbitration is

held to be an ICA seated in India, the only competent

“Court” under Section 2(1)(e)(ii) of the Act, 1996 is the High

11

Court, i.e. this High Court’s Commercial Division Bench.

Section 10 of the Commercial Courts Act, 2015 reinforces

this position by allocating arbitration matters of specified

value to the appropriate Commercial Division of the High

Court in cases of ICA. Therefore, the learned Commercial

Court at the District Level rightly declined jurisdiction and

returned the Section 34 of the Act 1996 application for

presentation before the proper forum.

12.It is contended that instead of adopting the correct course of

re-presenting the Section 34 application before the

competent High Court, the appellant has chosen to file the

present appeal against a non-appealable order, thereby

protracting proceedings and delaying the inevitable

presentation before the appropriate Court. Such a course, it

is submitted, is procedurally misconceived. Learned counsel

further submits that subject-matter jurisdiction is

fundamental and can be examined at any stage of the

proceedings. It cannot be conferred by consent, waiver,

acquiescence, or absence of objection. Therefore, the fact

that no party raised a jurisdictional objection before the

Commercial Court is wholly immaterial. The Commercial

Court was duty-bound to examine its own jurisdiction and

act accordingly.

13.It is also submitted that appeal provisions must be strictly

12

construed. The legislative policy underlying the Arbitration

and Conciliation Act, particularly post the 2015

amendments, is to minimize judicial interference and

confine appellate remedies to narrowly defined categories.

Expanding the scope of Section 37 to include procedural

return orders would defeat this policy and open the

floodgates to appeals against interlocutory or threshold

orders. Learned counsel clarifies that the respondent does

not, at this stage, traverse any of the appellant’s grounds on

merits under Section 34 of the Act. All substantive defences

and objections on merits are expressly reserved and shall

be advanced only if this Court first holds that the present

appeal is maintainable, which is emphatically denied.

14.It is lastly submitted that there is no order of stay under

Section 36(2) or 36(3) of the Act, 1996. Consequently, the

arbitral award remains enforceable in law, and the mere

pendency of the present appeal does not operate as a bar

to execution. In view of the aforesaid submissions, learned

counsel prays that the present appeal be dismissed in

limine as not maintainable.

15.We have heard learned counsel for the parties and perused

the material available on record.

16.The question which arises for consideration before this

Court whether an order for want of jurisdiction is appealable

13

under Section 37 of the Act, 1996 and whether the learned

Trail Court rightly finds that the impugned award squarely

covers under the definition of International Commercial

Arbitration as defined in Section 2(f) ?

17.Perusal of the impugned order goes to show that the

learned Commercial Court does not adjudicate upon any of

the grounds raised under Section 34(2) of the Act. 1996.

The learned Commercial Court has neither set aside the

award nor refused to set aside the award. It has merely

recorded a finding that it lacks jurisdiction in view of the

arbitration being an International Commercial Arbitration and

has directed return of the petition for presentation before the

competent Court/forum. Such an order is jurisdictional and

procedural in nature. It is similar to an order under Order VII

Rule 10 of the Code of Civil Procedure directing return of a

plaint for presentation before the competent Court. It does

not determine the rights of the parties on merits.

18.It is clear from Section 37 of the Act, 1996 that it

exhaustively enumerates the orders from which an appeal

shall lie. Insofar as orders under Section 34 of the Act, 1996

are concerned, an appeal lies only against an order “setting

aside or refusing to set aside an arbitral award.” The

provision is restrictive in nature and uses the expression

“and from no others,” thereby clearly indicating legislative

14

intent to confine appellate remedies strictly to the categories

specified therein. The impugned order, being merely an

order returning the petition on the ground of lack of

jurisdiction, does not fall within the ambit of Section 37(1)(c)

of the Act, 1996.

19.It is not disputed that the respondent Company is a joint

venture which includes SMEC (India) Pvt. Ltd and SMEC

Internatinal Pty. Ltd. For ready reference, the significant

portion of the letter of Joint Venture dated 15.01.2014 is

reproduced herein as under :-

LETTER OF JOINT VENTURE

“Dear Sir,

We, SMEC (India) Pvt. Ltd. are pleased to

confirm our Joint Venture with SMEC

International Pty. Ltd. for rendering the

consultancy services for the above mentioned

project.

We also confirm that SMEC International Pty.

Ltd, Australia will be the Lead Consultant for

the abovementioned project and will act as a

spokesman and enter into the contract

agreement on behalf of us. We empower

SMEC International Pty. Ltd. to sign and

submit the proposal & make legally binding

contractual commitment for the above

15

mentioned project.”

20.The appellant/State has also filed copy of Power of Attorney

To Lead Member of Joint Venture, which provides as

under :-

“xxxxxx

We, SMEC (India) Pvt. Ltd, hereby designate

SMEC International Pty. Ltd. as the Lead

Member of the Joint Venture and hereby

authorize Mr. George Lasek, Regional

Manager, SMEC International Pty. Ltd to sign

& submit the proposal and representing us in

all matters before Client, and generally dealing

with Client in all matters in connection with our

bid for the said Project.”

21.It is clear from the letter dated 15.01.2014 that the Lead

Consultant for the project was SMEC International Pty. Ltd,

Australia and this letter was addressed to Project Director

(PIU), ABD Project, O/o the Engineer-in-Chief, Chhattisgarh

PWD, Sirpur Bhawan, Civil Lines, Raipur (C.G.).

22.It is also not in dispute that respondent company had filed

an application before this High Court for appointment of

Arbitrator and this Court vide order dated 13.05.2019, had

appointed the Sole Arbitrator. Against the said order of

appointment of Arbitrator, the State/appellant had filed

16

Special Leave Petition before the Hon’ble Apex Court, which

was dismissed by Hon’ble Apex Court on 11.09.2019.

23.In the matter of Amway (supra), Hon’ble Apex Court held in

para 14 and 16 as under :-

“14.This case is distinguishable on facts,

inasmuch as a final judgment between the

parties made it clear that it would not be open

for the consortium to rely upon their status as

independent entities while dealing with

MMRDA. This being the case, the consortium

was held to be an association of persons

falling under Section 2(1)(f)(iii), and that since

the lead member is to lead arbitral

proceedings, the central management and

control of the consortium being exercised by

Larsen and Toubro in India, it was held that

Section 2(1)(f)(iii) would not be attracted on

the facts of that case.

15.xxxx

16.In this view of the matter, the argument

that there is no international flavour to the

transaction between the parties has no legs to

stand on. Indeed, an analysis of Section 2(1)

(f) would show that whatever be the

transaction between the parties, if it happens

to be entered into between persons, at least

one of whom is either a foreign national, or

habitually resident in, any country other than

India; or by a body corporate which is

incorporated in any country other than India;

17

or by the Government of a foreign country, the

arbitration becomes an international

commercial arbitration notwithstanding the fact

that the individual, body corporate, or

government of a foreign country referred to in

Section 2(1)(f) carry on business in India

through a business office in India. This being

the case, it is clear that the Delhi High Court

had no jurisdiction to appoint an arbitrator in

the facts of this case.”

24.In the light of aforesaid dictum of Hon’ble Apex Court in

Amway (supra), it is clear that the lead member in this

project is SMEC International Pty. Ltd., whose head office is

situated in Australia, as such, the arbitration becomes an

International Commercial Arbitration.

25.The case law relied upon by learned State counsel in

Daryao (supra) would be of no help being distinguishable

on the ground of facts.

26.Thus, this Court is of the considered opinion that the learned

Trial Court has rightly passed the impugned order which is

purely jurisdictional and procedural in nature. It does not

amount to an order setting aside or refusing to set aside the

arbitral award and Section 37 of the Act, 1996 does not

provide for an appeal against such an order & Section 13 of

the Commercial Courts Act does not enlarge the scope of

appealability. Consequently, the present appeal is not

18

maintainable.

27.In the result, the appeal is dismissed as not maintainable at

the admission stage. It is, however, clarified that dismissal

of the present appeal shall not preclude the appellant from

presenting the application under Section 34 of the Act, 1996

or appropriate petition before the appropriate forum, if so

advised, and in accordance with law. No order as to costs.

28.Pending applications, if any, stand disposed of.

Sd/- Sd/-

(Rajani Dubey) (Radhakishan Agrawal)

Judge Judge

pekde