Validity of MSME registration and qualification as a 'Supplier' under the MSME Act of 2006.

JUDGMENT :

1. Though the matter was listed under ‘Orders’ category, but at the joint request of the counsels for the parties, the matter is finally heard and decided today itself.

2. The present writ petition is filed under Articles 226 and 227 of the Constitution of India, claiming following reliefs:

‘It is most respectfully and humbly prayed that:

1. this writ petition may kindly be admitted and allowed and decision taken dated 15.07.2021 (Annexure 8) as issued by Respondent No. 1 be quashed.

2. Respondent ought be estopped from committing any such future acts and be directed to conduct the proceedings with utmost fairness and if deemed fit, to prepare and submit a proper report to the parties before referring the dispute to arbitration, if at all;

3. the cost of this writ petition may also kindly be awarded in favour of the Petitioner; and

4. Any other appropriate order or direction which this Hon’ble Court may consider just and proper in the facts and circumstances of the case may also kindly be passed in favour of the humble petitioner Hotel.’

3. The essential factual background of the case is that the Petitioner is a company within the tourism sector, with presence in multiple states across India, and has been engaged in business operations for over five decades. The Petitioner-Company and Eagle Intelligence Securities Services Pvt. Ltd. (hereinafter referred to as 'Respondent No. 2’) have periodically conducted business together, with the Petitioner hotel making payments exceeding Rs. 10 Lakhs at various times to Respondent No. 2 for providing security services.

4. The Petitioner allotted new work to Respondent No. 2 in respect of petitioner’s hotel property in Jodhpur. However, the payment was not made to Respondent No. 2 citing the reason that the services of the Respondent No.2 did not meet the standards of the Petitioner company and a concern regarding the quality of services was also raised by Petitioner.

5. Thereafter, the Respondent No 2 filed a complaint before the Rajasthan Micro, Small and Medium Enterprises Facilitation Council (hereinafter referred to as ‘Respondent No. 1’), Respondent No.1, bearing no. RJ/22/S/RIS/01292 and serial No F9.(01292)RMSEFC/2019/8624-8625, regarding the aforesaid non-payment.

6. During the pendency of the complaint which was filed by Respondent No.2, the Respondent No.1 had issued several notices fixing dates in the matter with the direction to Petitioner to appear in person. In the notice dated 08.04.2021 (Annexure-5), the Respondent No.1 informed the petitioner that in the event of non-appearance, an award under the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act of 1996’) would be passed. Then the Respondent No.1 issued a notice dated 25.06.2021 (Annexure-6), fixing a meeting for conciliation between the parties on 05.07.2021.

7. In furtherance of notice dated 25.06.2021, Respondent No.1 conducted a meeting on 05.07.2021. The Petitioner through its counsels requested for a link for video conferencing through e-Mail (Annexure-7).

8. Thereafter, the petitioner received an e-Mail dated 15.07.2021 (Annexure-8) from Respondent No. 1, which contained two screenshots, i.e., pages 1 and 2 respectively of the impugned decision taken by Respondent No.1 in its meeting dated 05.07.2021.

9. Thus, being aggrieved of the order dated 15.07.2021 (Annexure-8) by Respondent No. 1, the petitioner has preferred this writ petition.

10. The learned counsel for the respondents while raising preliminary objections submitted:

(A) That the writ petition is not maintainable on the ground that there is an alternate remedy available to the petitioner under section 18 and 19 of the Act of 2006, which are reproduced hereunder:

‘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 Enterp