The deposit of 75% of the awarded sum under Section 19 of the MSMED Act could be made when the application was ultimately entertained by the court, and the limitation for filing the application under Section 34 of the Arbitration Act was governed by Section 34(3) of the Arbitration Act.

R.D. DHANUKA, J.

1. By this appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996 (for short “the Arbitration Act”), the appellant has impugned the order dated 13th June 2016 passed by the learned Principal District Judge, Thane allowing the application filed by the respondent herein raising a preliminary objection on the maintainability of the application filed by the appellant herein under Section 34 of the Arbitration Act and holding that the said arbitration application was not maintainable. Learned Principal District Judge rejected the arbitration application filed by the appellant praying for setting aside the impugned award dated 17th March 2015. Some of the relevant facts for the purpose of deciding this appeal are as under:-

2. The appellant had issued a work order dated 9th January 2008 to the respondent for Epoxy flooring, coving, hygiene PU wall coating and other specialty coating at its hospital in Chennai. The total value of the work order was Rs.1,09,55,852/-. The dispute arose between the parties. The respondent herein made an application before the Micro and Small Enterprises Facilitation Council, Konkan Region, Thane (Reference Petition No. 19 of 2013) inter-alia praying for an amount of Rs.21,17,361/- against the appellant herein. The appellant herein filed an application before the said council appointed under the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 (for short “the said MSMED Act”) challenging its jurisdiction and also raised various objections regarding the claims of the respondent on merits. The said council made an award on 17th March 2015 directing the appellant to pay the principal amount of Rs.10,31,915/- to the respondent and interest thereon as per the provisions of Section 16 of the said MSMED Act.

3. The appellant herein filed a Civil Miscellaneous Application No. 236 of 2015 before the learned Principal District Judge, Thane under Section 34 of the Arbitration Act or thereby impugning the said award dated 17th March 2015 rendered by the said council.

4. On 1st August 2015, the council issued a certificate transferring the execution proceedings qua the award to the Principal District Judge, Chennai. On 9th December 2015, the respondent herein filed a proceeding challenging the maintainability of the said Civil Miscellaneous Application filed by the appellant inter-alia on the ground that the appellant herein had failed to deposit 75% of the amount awarded to the respondent with the learned Principal District Judge along with the said application under Section 34 in terms of Section 19 of the said MSMED Act.

5. On 5th March 2016, the appellant herein filed an application before the learned Principal District Judge, Thane inter-alia praying for permission to deposit 75% of the amount awarded to the respondent by the said council vide demand drafts in the Court of the learned Principal Judge, Thane. On 2nd April 2016, the appellant filed another application with a request to permit the appellant to deposit 75% of the amount awarded to the respondent under the said award with the Nazir Office which section is responsible for collecting the court deposits. The said applications filed by the appellant were resisted by the respondent before the learned Principal District Judge, Thane.

6. On 13th June 2016, the learned Principal District Judge, Thane allowed the said application dated 9th December 2015 filed by the respondent raising a preliminary objection to the maintainability of the said civil miscellaneous application filed by the appellant under Section 34 of the Arbitration Act and held that since the appellant herein had failed to deposit 75% of the amount awarded to the respondent by the council in the said award prior to filing of the said civil miscellaneous application, the said civil miscellaneous application was not maintainable. Learned Principal District Judge also held that the appellant had not deposited 75% of the amount