Arbitral award in MSME dispute upheld absent patent illegality; limitation from last partial payment; office bearers liable as representatives; higher publication rate inferred from substantial payments exceeding low-rate invoice.

JUDGMENT :

SATYEN VAIDYA, J.

1. This petition has been filed under Section 34 of the ARBITRATION AND CONCILIATION ACT , 1996 (for short “the Act”) against the Award dated 09.01.2019, passed by learned Arbitrator in Arbitration Proceedings Reference No.52 of 2017.

2. Brief facts necessary for adjudication of the petition are that the respondent was publisher of a daily vernacular newspaper under the name and style of “Pehli Khabar”. Political advertisements were published in “Pehli Khabar” from 05.10.2014 to 15.10.2014 for Haryana Pradesh Congress Committee (for short “the HCC”).

3. The respondent being an enterprise, registered under the Micro, Small & Medium Enterprises Act, 2006 (for short, MSME Act”), made a reference to the Himachal Pradesh MSME Council seeking the unpaid amount for the political advertisements published in “Pehli Khabar” from 05.10.2014 to 15.10.2014 for HCC. The respondent claimed that the invoice dated 15.10.2014 of Rs.38,69,250/- was generated for the publications made for HCC, but only a sum of Rs.22,67,728/- was received and, as such, was entitled to balance outstanding amount of Rs.16,01,522/- along with interest as payable under the MSME Act. As per the respondent, the payment of Rs.22,67,728/- had been received by him vide cheque No.000146 dated 30.10.2014 in the sum of Rs.12,67,728, cheque No.000198 dated 18.12.2014 in the sum of Rs.5,00,000/- and cheque No.000199 dated 05.01.2015 for Rs.5,00,000/-.

4. The respondent impleaded Shri Rahul Gandhi, President, Indian National Congress, besides the petitioners herein as respondents in the reference filed before MSME Council.

5. The name of Mr. Rahul Gandhi, President, Indian National Congress, was deleted from the array of respondents by the Council during the pendency of reconciliation proceedings.

6. The MSME Council called upon the petitioners herein to file reply to the claim of respondent. The petitioners herein filed their written statement. The Council finally vide order dated 30.06.2018 referred the matter to the arbitration of sole Arbitrator Mr. Ravinder Parkash Verma, District & Sessions Judge (retired) on the ground that the conciliation had failed.

7. Order dated 30.06.2018, passed by the MSME Council, was assailed by the petitioners before this Court by way of CWP No.2006 of 2018. The said petition was disposed of by a Division Bench of this Court on 22nd November, 2018 with the consent of both the parties in following terms:

“2. Having heard learned counsel for the parties for some time, it appears expedient to dispose of these proceedings with the consent of learned counsel for the parties in following terms:

(i) The learned Arbitrator shall formulate all the points issues raised having arisen for adjudication and shall return findings point-wise while passing a reasoned Award.
(ii) The issues points to be adjudicated by the Arbitrator shall include.
(a) whether the Himachal Pradesh Micro & Small Enterprises Facilitation Council was competent to make the subject Reference?
(b) whether the Himachal Pradesh Micro & Small Enterprises Facili