HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR
Pushpendra Singh Bhati, J.
Jodhpur Vidhyut Vitaran Nigam Limited – Appellant
Versus
M/s. Anamika Conductors Limited – Respondent
S.B. Civil Writ Petition No. 5373 of 2019
Decided On : 25-01-2022
COVID-19 - Legal Proceedings - Micro, Small and Medium Enterprises Development Act, 2006, Section 18 - The court discussed the provisions of Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006, which empowers the Micro and Small Enterprises Facilitation Council to conduct conciliation and arbitration in disputes. The court emphasized the objective of the Act to promote and develop micro, small, and medium enterprises and ensure their competitiveness. It also highlighted the requirement for pre-deposit before filing an appeal or application for setting aside the award, and the availability of statutory remedies under Section 34.
Fact of the Case:
The court addressed the maintainability of a writ petition in light of a dispute related to the Micro, Small and Medium Enterprises Development Act, 2006. The respondent raised a preliminary objection regarding the maintainability of the writ petition and referred to relevant case law.
Finding of the Court:
The court found that the writ petition was not maintainable due to the availability of an alternative efficacious remedy under the Act. It dismissed the appeal and extended the period for filing an appeal by the petitioners.
Issues: The main issue was the maintainability of the writ petition in the context of the statutory alternative remedy available under the Micro, Small and Medium Enterprises Development Act, 2006.
Ratio Decidendi: The court held that the writ petition was not maintainable due to the availability of a statutory alternative remedy under the Act, and directed the petitioner to pursue the alternate remedy by filing an appeal.
Final Decision: The court dismissed the appeal and extended the period for filing an appeal by the petitioners, while giving the petitioner liberty to take up all issues in appeal.
ORDER
1. In wake of instant surge in COVID-19 cases and spread of its highly infectious Omicron variant, the lawyers have been advised to refrain from coming to the Courts.
2. Counsel for the respondent while raising preliminary objection as regards maintainability of writ petition and has referred to the judgment passed by Hon'ble Division Bench of this Court (Jaipur Bench) in Sanghi Industries Limited & Anr. Vs. Micro Small Enterprises Facilitation Council & Anr., (D.B. Special Appeal Writ No.591/2018) vide order dated 26.04.2018, which reads as follows :-
'1. By way of this appeal, the appellant has assailed the judgment and order of the learned Single Judge whereby learned Single Judge while considering the application under Article 226 (3) of the Constitution of India for vacating the ex-parte stay order granted on 16.1.2018 has rejected the writ petition being not maintainable.
2. Counsel for the appellant has taken us to the provisions of Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 which reads as under:-
18. Reference to Micro and Small Enterprises Facilitation Council.-
(1) Notwithstanding anything contained in any other law for the time being in force, any party to a dispute may, with regard to any amount due under section 17, make a reference to the Micro and Small Enterprises Facilitation Council..
(2) On receipt of a reference under sub-section (1), the Council shall either itself conduct conciliation in the matter or seek the assistance of any institution or centre providing alternate dispute resolution services by making a reference to such an institution or centre, for conducting conciliation and the provisions of sections 65 to 81 of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall apply to such a dispute as if the conciliation was initiated under Part III of that Act.
(3) Where the conciliation initiated under subsection (2) is not successful and stands terminated without any settlement between the parties, the Council shall either itself take up the dispute for arbitration or refer to it any institution or centre providing alternate dispute resolution services for such arbitration and the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall then apply to the dispute as if the arbitration was in pursuance of an arbitration agreement referred to in subsection (1) of section 7 of that Act.
(4) Notwithstanding anything contained in any other law for the time being in force, the Micro and Small Enterprises Facilitation Council or the centre providing alternate dispute resolution services shall have jurisdiction to act as an Arbitrator or Conciliator under this section in a dispute between the supplier located within its jurisdiction and a buyer located anywhere in India.
(5) Every reference made under this section shall be decided within a period of ninety days from the date of making such a reference.
3. He contended that Council has not followed the procedure and stated that in fact they have challenged the order by paying 75% of the amount as a pre-deposit.
4. He also contended that the judgment referred by the learned Single Judge reported in the case of Authorized Officer, State Bank of Travancore and anr. vs. Mathew K.C. (2018) 3 SCC 85 is an exception and the case of the appellant is falling under exception.
5. However, no such contention was raised before the learned Single Judge and the learned Single Judge while considering the case observed as under:-
'7. From the perusal of the aforesaid provisions, it is apparent that the Act of 2006 is a special Act which has been notified with effect from 16.06.2006 and has come into force on 02.10.2006, the same has been introduced with the purpose of facilitating the promotion and development of micro, small and medium enterprises as well as ensuring their competitiveness. It empowers the Central government to notify programmes, guidelines and instructions for the promotion and growth of micro, small a
The main legal point established in the judgment is the importance of considering the availability of statutory alternative remedies before entertaining a writ petition, particularly in the context o....
The High Court cannot entertain writ petitions challenging awards of the Micro and Small Enterprises Facilitation Council without the mandatory deposit of 75% of the awarded amount as per Section 19 ....
The main legal point established in the judgment is the requirement of complying with the provisions of Section 19 for challenging an award under the Act of 1996 and the limitations on entertaining a....
The main legal point established in the judgment is that the remedy for a party aggrieved by the order or an award of the arbitral tribunal is to take remedy under the Act of 1996 rather than bringin....
A writ petition challenging an award under the MSME Act is not maintainable unless the petitioner deposits 75% of the awarded amount, as mandated by Section 19 of the MSME Act, 2006.
Writ petition against arbitral award is maintainable; petitioner must follow remedies under Arbitration Act.
The MSMED Act, 2006 provides a specific dispute resolution mechanism that overrides private arbitration agreements, making writ petitions not maintainable when an alternative remedy exists.
Writ Jurisdiction – Access to High Courts by way of writ petition under Article 226 of Constitution of India, is not just a constitutional right but also a part of basic structure – It is available t....
The award passed by the Facilitation Council is without jurisdiction and, therefore, a nullity.
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