How to determine court's pecuniary jurisdiction under section 34 of the arbitration act, 1996?

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Shubham Budhiraja

Hon'ble Delhi High Court held that it is not the award amount but the claim amount + counter claim amount that determines pecuniary jurisdiction under section 34. [OMP (Comm) 465/2022]

 

(i)                Under Section 5(2) of the Delhi High Court Act, 1966, the ordinary original civil jurisdiction of this Court is attracted in a suit valued at over Rs. 2 crores.

 

(ii)                Section 12(2) of the Commercial Courts Act, 2015, relevant for valuation of these petitions under Section 34 of the Act, provides that the “specified value” in an arbitration of a commercial dispute will include the value of both the claims and counter claims.

 

(iii)              Under Section 2(1)(e) of the Act, the jurisdiction for filing of proceedings in a Court-including a petition under Section 34 of the Act-would lie with the Court which would have had jurisdiction to entertain the claims if they were the subject matter of a suit.

 

(iv)              The effect of these statutory provisions is that a petition under Section 34 of the Act can be entertained in this Court only if the value of the claims and counter claims adjudicated by the learned arbitrator in each case, exceeds Rs. 2 crores.

 

(v)                The award value is not the applicable metric.

 

(vi)              In any event, it is less than Rs. 2 crores in each case.

 

(vii)             The exercise of Section 11 jurisdiction by the Supreme Court, or a High Court does not vest jurisdiction for all future petitions in that Court.

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