IMPORTANT POINT
The main legal point established in the judgment is that the Micro and Small Enterprises Facilitation Council must have jurisdiction to entertain applications and refer matters to the Arbitral Tribunal, and the registration status of the parties as Micro, Small, or Medium Enterprises during the relevant transactions is crucial to determine jurisdiction.

ORDER :

1. The petitioner is before this Court calling in question orders dated 07.01.2023 and 22.02.2023 passed by the second respondent-Arbitrator rejecting the application filed by the petitioner to decide the issue of jurisdiction tacit at the outset.

2. Heard the learned counsel Sri. Vikram Unni Rajagopal, appearing for the petitioner and the learned counsel Sri. Akash R. Rao, appearing for respondent No. 1.

3. The petitioner claims to be a company incorporated under the provisions of the Companies Act, 1956. The first respondent and the petitioner enter into a contract, pursuant to which, the petitioner issued a work order to the first respondent for painting and scaffolding on 10.05.2018. An invoice of Rs. 6,04,870/- is also raised on 22.05.2018 for payment of the said amount. Therefore, the issuance of the work order and execution of work begins on 10.05.2018 and the invoice for such work is raised on 22.05.2018. After the aforesaid events, the first respondent registers itself to be a Micro Enterprise under the Micro, Small and Medium Enterprises Development Act, 2006 (for short ‘the MSME Act’). Long thereafter, with regard to certain payment, dispute arose between the petitioner and the first respondent. The first respondent then files an application before the Micro and Small Enterprises Facilitation Council (for short ‘the Council’) claiming a sum of Rs. 8,38,731/-. During the pendency of the proceedings before the Council, the first respondent gets the certificate of registration as Micro Enterprise under the Act on 16.07.2021. The Council initiates conciliation proceedings under Section 18 of the Act and when the dispute did not get resolved, recorded failure of conciliation and referred the matter to Arbitration in terms of its order dated 03.02.2022.

4. The first respondent files a arbitration petition in A.C. No. 222/2022, by then, claiming a sum of Rs. 19,08,538/-. The petitioner files its objections before the arbitral Tribunal to the claim petition on 25.11.2022. Long thereafter, on 07.01.2023, the petitioner files an application under Order 14 Rule 2(2) read with Section 151 of the CPC, to try the issue of jurisdiction as a preliminary issue. No order is passed on the said application. Arbitration proceedings were posted for proceedings on the issue already framed. It is then, the petitioner knocks at the doors of this Court in the subject petition.

5. Learned counsel appearing for the petitioner would contend that the Arbitral Tribunal has no jurisdiction to entertain the petition, as it is referred to, by the Council. When Council itself had no jurisdiction to entertain the petition, as the registration of the first respondent as a Micro Enterprise takes place long after the execution of work was over and invoice had been raised, between the two. Learned counsel would submit that only because the registration had taken place after all the transactions between the two were over, the Council had no jurisdiction to consider the dispute between the two. It was open for the first respondent to approach any competent Court of law agitating his grievance. He would place reliance upon the following judgments of the Apex Court:

(i) Vaishno Enterprises vs. Hamilton Medical AG and Another, 2022 SCC Online SC 355

(ii) M/s. Nitesh Estates Ltd. vs. Micro and Small Enterprises Facilitation Council of Haryana and Others, 2022 SCC Online SC 1198

6. Learned counsel appearing for the first respondent would submit that the petitioner at no point in time had raised any objection with regard to the Council having no jurisdiction in the matter. He has acquiesced his rights by continuing the proceeding and at the fag end of the proceeding before the Arbitral Tribunal, has knocked at the doors of this Court and would seek dismissal of the petition.

7. Insofar as the judgments relied on by the learned counsel for the petitioner, the learned counsel for respondent No. 1 would refute the same on the score that those were cases where on issu