The Supreme Court in held that irrespective of where the ‘central management and control is exercised’ by a company, companies incorporated in India, cannot choose foreign law as the governing law of their arbitration.

TDM Infrastructure (P) Ltd. v. UE Development India (P) Ltd., (2008) 14 SCC 271. TDM Infrastructure Private Limited approached the Supreme Court of India for appointment of an arbitrator to resolve their disputes. The application was challenged on the ground that the Supreme Court was not an appropriate forum because the arbitration was not an “international commercial arbitration”. The Court upheld this challenge and dismissed the application. The Supreme Court also observed that: Section 28 of the 1996 Act is imperative in character in view of Section 2(6) thereof, which excludes the same from those provisions which parties derogate from (if so provided by the Act). The intention of the Legislature appears to be clear that Indian nationals should not be permitted to derogate from Indian law. This is part of the public policy of the country. It was held that irrespective of where the central management and control is exercised by a company, companies incorporated in India, cannot choose foreign law as the governing law of their arbitration.