The entitlement of the award holder to MSME status, the quantification of interest claimed, and the reasoning behind the arbitral award were central legal points established in the judgment.

JUDGMENT

Shekhar B. Saraf, J. - Usha Martin Limited (hereinafter referred to as the 'petitioner/award debtor') has filed this application being AP 486/2017 under Section 34 of Arbitration & Conciliation Act, 1996 before this Court, praying for setting aside of an arbitral award dated February 03, 2017 passed by West Bengal State Micro Small Enterprises Facilitation Council ('WBSMSEFC' or 'Council') on February 3, 2017, in favor of Eastern Gases Limited (hereinafter referred to as the 'respondent/award holder'). The award holder has filed an execution application being EC 330/2017 under Section 36 of Arbitration & Conciliation Act, 1996 before this Court, praying for execution of the said arbitral award. In both the matters, multiple interlocutory applications have been filed by the parties.

2. The following are the facts of the matter are as follows:

a. The award debtor was in requirement of petroleum gases (LPG Butane) from Indian Oil Corporation and had appointed the award holder to obtain delivery of such bottled butane gas which were to be transported from Haldia to Ranchi. Several purchase orders regarding the same were issued between 2010 and 2014 by the award debtor. The terms of the purchase orders mandated payment within 30 days from the date of material receipt or else interest was to be paid at 2% per month on the amount of delayed payment.

b. There was delay in payment by the award debtor to the respondent for the said purchase orders. Ultimately, the bills were cleared by the award debtor but the payment of interest on the delayed amount was not made. Thereafter, a reference was made by the respondent to WBSMSEFC under Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 ('MSMED Act, 2006) for settlement of disputes between the parties.

c. The WBSMSEFC initially conducted two conciliation meetings, under Section 18(2) of the MSMED Act, 2006 with the first meeting being held on September 19, 2014, and the second one on September 01, 2016. Both the conciliation meetings failed, subsequent to which arbitration proceedings were initiated and taken up by WBSMSEFC itself under Section 18(3) Of the MSMED Act, 2006. The record shows that only one hearing was held on September 21, 2016, and the award was passed on February 3, 2017, in favor of the award holder.

d. Being aggrieved with the said arbitral award, the present application being AP No. 486/2017 was filed on June 22, 2017 by the award debtor praying for setting aside the said arbitral award under Section 34 of Arbitration & Conciliation Act, 1996. Thereafter, on November 7, 2017, an order was passed by the bench of Hon'ble Justice Ashish Kumar Chakraborty of this Court directing the award debtor to deposit INR 25,00,000 (Twenty-five lakhs only) with Registrar, Original Side within three weeks. The award debtor failed to deposit the amount within the original deadline set by Hon'ble Justice Ashish Kumar Chakraborty in the said order and consequently, execution application was filed by the award holder.

e. On August 20, 2018, while both applications were pending before this Court, by an order of NCLT Kolkata Bench, award holder went into liquidation under Insolvency and Bankruptcy Code, 2016.

3. Mr. Rudraman Bhattacharya, counsel appearing on behalf of the award debtor has made the following submissions:

a. The counsel submits that the claim of the award debtor was not towards the principal amount as the award debtor has been paid the said amount in full. The claim of the award debtor was towards payment of interest on an alleged delay in making payment.

b. The counsel contends that the respondent by itself is not a small enterprise as the turnover of the respondent is well in excess of INR 200 Crores. The investment in assets exceeds more than INR 10 crores. The counsel has placed the balance sheet of the award holder for the year 2012-13 and 2013-14 in support of his contention. He argues that only the Durgapur unit of the award debtor has been classi