Pecuniary Jurisdiction Alone Cannot Confer S.34 Jurisdiction In Arbitration Petitions: Calcutta High Court

On 18 June, the Calcutta High Court held that pecuniary jurisdiction alone cannot confer jurisdiction under Section 34 of the Arbitration and Conciliation Act, 1996, in the absence of territorial jurisdiction, reiterating that both conditions must coexist for a court to entertain a challenge to an arbitral award.

Justice Gaurang Kanth dismissed a petition filed by Kanchan Konwer and another, the widow and son of late Tapan Konwer, who challenged an arbitral award passed in favour of developer Tushar Kanti Jana, holding that the Original Side of the Calcutta High Court lacked territorial jurisdiction to hear the Section 34 petition. He held:

“Pecuniary jurisdiction by itself does not confer jurisdiction upon a court in the absence of territorial jurisdiction. The two requirements operate cumulatively and not alternatively. A court may possess pecuniary competence to entertain a matter; however, unless territorial jurisdiction is also established in accordance with law, such court cannot assume jurisdiction merely on the basis of the valuation of the claim.”

The dispute arose from a Development Agreement dated 3 August 2018 executed between late Tapan Konwer and Tushar Kanti Jana for a 258 sq. ft portion of property at Keyatala Lane, South 24 Parganas. The respondent claimed that he paid Rs. 9.40 lakh under the agreement. After Tapan Konwer died on 28 August 2023, the respondent issued notices to his legal heirs in March and May 2025.

The parties invoked arbitration on 3 May 2025, and the High Court appointed a sole arbitrator on 8 July 2025. The arbitrator passed an ex parte award on 29 January 2026, directing the petitioners to pay over Rs. 49 lakh along with interest. The petitioners then approached the High Court under Section 34 to set aside the award.

The Court accepted the respondent's preliminary objection and held that Section 2(1)(e) of the Arbitration and Conciliation Act defines “Court” as the principal civil court of original jurisdiction in a district, or the High Court exercising ordinary original civil jurisdiction, which would have jurisdiction over the subject matter if it were filed as a civil suit.

It further found that the subject property fell within the territorial jurisdiction of the courts at Alipore and that the Development Agreement itself provided for jurisdiction of courts competent over the situs of the property. On this basis, the Bench held that the Original Side of the High Court could not qualify as the “Court” for the purposes of Section 34.

Since it found that territorial jurisdiction was absent, it declined to examine the merits of the arbitral award, noting that any findings could prejudice the parties before the competent forum.

Accordingly, the High Court dismissed the petition as not maintainable and granted liberty to the petitioners to approach the appropriate court in accordance with law.