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IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
JYOTSNA REWAL DUA, J.
M/s Sterkem Pharma Private Limited – Petitioner
Versus
Symbiosis Pharmaceuticals Private Limited and Others – Respondents
CMPMO No. 274 of 2023
Decided On : 16-06-2023
Micro, Small and Medium Enterprises Development Act, 2006 - Section 18, (1), (2), (3), 34, 17 - Arbitration and Conciliation Act, 1996 - Sections 31, (5), 65 to 81 - Himachal Pradesh Micro and Small Enterprises Facilitation Council Rules, 2018 - Rules 4(ix) and (x) - Arbitral award - Supply signed copy of award - Prayer has been made for supplying signed copy of arbitral award - Arbitral award is to be made available to parties by Arbitrator himself in accordance with provisions of Section 31(5) of 1996 Act.
Findings of the Court:
Council after itself entering into arbitration, finalizes award and other where it receives award from institution - As per Rule 4(x), in both cases, Council is to “pass an appropriate final order in matter” Passing of appropriate final order in matter cannot be construed to mean that Council is to pass an order different from award passed by learned Arbitrator - 2018 Rules cannot be construed and interpreted to mean that MSME Council or for that matter appointed Arbitrator can sit over mandate of Section 31(5) of 1996 Act to deny supply of signed copies of arbitral award to parties - Legal position, requirement and significance of supply of signed copy of arbitral award to parties has been settled by Hon’ble Apex Court in its various authoritative pronouncements, some of which have been enumerated above - It is bounden duty of Arbitrator appointed by MSME Council to issue signed copies of arbitral award to parties irrespective of fact whether parties have contested proceedings or were proceeded ex-parte.
Result: Petition disposed of.
JUDGMENT :
JYOTSNA REWAL DUA, J.
1. Taking into consideration the controversy involved in the matter, the relief prayed for by the petitioner and the submissions made by learned counsel, notice of this petition is not required to be served upon respondents No. 1 and 2 as their interests are not affected in any manner.
2. The matter pertains to the procedure adopted by respondent No. 3 the Himachal Pradesh Micro Small Enterprises Facilitation Council (in short ‘MSME Council’) for supplying the arbitration award to the parties.
In the instant case, there is no challenge to any order passed by the learned Arbitrator. The arbitration proceedings are not under challenge. Prayer has been made only for supplying the signed copy of the arbitral award. In view of the nature of controversy raised in the petition, the facts pleaded by the petitioner and admission thereof by the MSME Council and also taking into consideration the general practice being adopted by the MSME Council, which is invariably resulting in non-supply of signed copies of the arbitral awards to the parties, this petition has been entertained for that limited purpose.
3. Genesis of problem leading to institution of instant petition:
(ii) The Arbitrator entered upon the reference. Learned Arbitrator, it seems issued notices to both the parties by way of E-mail. Present petitioner (respondent before the learned Arbitrator) was proceeded ex-parte on 22.12.2021. Present respondent No. 1 filed claim petition for recovery of Rs.6,02,468/- with future interest as provided in the 2006 Act alongwith costs. Award was announced by the learned Arbitrator on 12.04.2022. Respondent No. 1 was held entitled to the amount claimed. Learned Arbitrator after signing the award, dispatched the entire case file including the original award to the Chairman of the MSME Council for supplying the copies of the award to the concerned parties.
(iii) The petitioner feeling aggrieved against the award dated 12.04.2022, laid challenge to it by filing petition under Section 34 of the Arbitration and Conciliation Act, 1996 (in short ‘1996 Act’) in the Court of learned District Judge, Shimla. The petition was not held to be duly constituted as the signed copy of the award dated 12.04.2022 was not placed on record by the petitioner. During the pendency of its challenge to the aforesaid award, the petitioner, through its counsel, vide a written communication dated 30.06.2022 (page 20 of the paper book), requested the Arbitrator for supplying the signed copy of the award. Since signed copy of the award was not received by the petitioner, it ultimately withdrew the petition filed under Section 34 of the 1996 Act on 21.10.2022.
(iv) In the above factual background, instant petition has been preferred by the petitioner seeking direction to the respondents to issue signed copy of the award dated 12.04.2022 in Arbitration Reference No. 68/2021 (M/s Symbiosis Pharmaceuticals Pvt. Ltd. Versus M/s Sterkem Pharma Pvt. Ltd.).
4. I have heard Sh. Raman Jamalta, learned counsel for the petitioner, Sh. Y.P.S. Dhaulta, learned Additional Advocate General and S/Sh. Suneet Goel and Sunil Mohan Goel, learned Advocates, who assisted
Section 31 of 1996 Act pertains to form and contents of arbitral award.
Writ petition against arbitral award is maintainable; petitioner must follow remedies under Arbitration Act.
The mandatory pre-deposit requirement under Section 19 of the MSMED Act, 2006 for challenging an award and the overriding effect of the MSMED Act, 2006 over the Arbitration Act, 1996 in specific disp....
The lack of conciliation does not undermine the statutory obligation to make payment under the MSMED Act, emphasizing the importance of adherence to payment timelines by the buyer.
The main legal point established in the judgment is that the Facilitation Council has the jurisdiction to act as an Arbitrator after the failure of conciliation proceedings under the MSME Act. The ri....
The court confirmed that compliance with service requirements for an arbitral award can be established through proper postal dispatch and delivery confirmation under Section 31(5) of the Arbitration ....
The main legal point established is that arbitration proceedings under the MSMED Act must adhere to the procedural requirements of the Act and the Arbitration and Conciliation Act, 1996.
The necessity of delivering a signed copy of the arbitral award to each party to begin the running of the limitation period under Section 34 of the A&C Act.
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