The applicability of the Limitation Act, 1963 to claims arising under the MSMED Act, 2006 needed to be examined by a Larger Bench of the High Court.

B.P. Dharmadhikari, J.

This Court has issued notice in all these Appeals on 15.02.2018, and thereafter on 05.06.2018, after hearing the respective learned Counsel for some time, the same came to be adjourned to 10.07.2018 for hearing at 2.30 p.m. Efforts were being made to decide the appeals finally. Accordingly we “ADMIT” these appeals and hear them finally with consent, as only legal contentions are being raised. Needless to mention that facts are not in dispute between the parties.

2. Before proceeding further, bone of contention need to be mentioned briefly. Submission advanced by Shri S.P. Dhole, learned counsel who appears for appellants, is that the judgment of Hon'ble Supreme Court in case of T.N. Generation and Distribution Corporation vs. PPN Power Generation Company Pvt. Ltd (Civil Appeal No. 4126/2013), delivered on 04.04.2014, is not properly considered by the Division Bench of this Court at Bombay in (M/s. Delton Electricals vs. MSEDCL and others) Commercial Appeal No.38/2017. This judgment is delivered on 31.08.2017, and that appeal arose out of an Arbitration Petition (L) No.2464/2015 allowed by the learned Single Judge on 15.11.2016. Appellants state that judgment in case of T.N. Generation (supra), specifically observes that the provisions of Limitation Act, 1963 are not applicable to Statutory Arbitrations. This unequivocal declaration made in paragraph no.50 of that judgment clinches the issue in present matters.

3. According to Shri S.V. Purohit, learned Counsel who appears for respondents, the Division Bench judgment at Bombay in M/s. Delton Electricals vs. MSEDCL and others) (Commercial Appeal No.38/2017, decided on 31.08.2017, (supra) attempted to be distinguished by the appellants, is squarely attracted in present matters. In the light of this limited submission, appeals are taken up and heard finally.

4. Shri Dhole, learned counsel for appellants submits that the provisions contained in Micro, Small and Medium Enterprises Development Act, 2006 (hereinafter referred to as “MSMED Act” for short), show a special scheme and treatment provided to dues receivable by the enterprises regulated by it. He has taken us through relevant provisions to urge that when an enterprise or unit governed by it, like appellants, approaches Council under Section 18 of the MSMED Act, there is no question of limitation being pressed into service. He has also invited our attention to overriding effect extended by Section 24 thereof.

5. He has then invited our attention to the Division Bench judgment of this Court in case of M/s. Delton Electricals (supra). He points out that learned Single Judge there has looked into the provisions of Section 42 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the 1996 Act” for short), only and said consideration is further widened or expanded by the Division Bench. According to him, while adopting a “slightly different angle”, the Division Bench has relied upon interpretation of words “amounts due”. That interpretation in other enactments is in the context in which those words appear, and therefore, irrelevant in Scheme of the MSMED Act, when Section 2[4] of the 1996 Act itself stipulates that Section 43 is not applicable to such Arbitration proceedings and therefore, Limitation Act, 1963 also has no application.

6. He invites attention to the findings in this respect recorded by the learned Counsel in favour of appellants. He submits that the Council has found that the Arbitration Act does not apply. In application under Section 34 of the 1996 Act, the Commercial Court at Nagpur has reversed this findings and applied limitation of three years, as the proceedings are found to be initiated beyond the period of three years, award in favour of appellants has been set aside. He relies upon judgment reported at AIR 2010 SC 972 (M/s. Ravindra Kumar Gupta and Company vs. Union of India) (paragraph nos. 11 and 12), to urge that under Section 34, the Commercial Court coul