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S. SOUNTHAR
Sri Valli Process, Rep by its Proprietor, S. Karuppaiah – Appellant
Versus
Micro Small Enterprises Facilitation Council, Chennai Region, Rep. By its Chairman/Principal Secretary, Industries Commissioner and Director of Industries and Commerce, Chennai – Respondent
JUDGMENT
(Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a writ of certiorari, calling for the records on the file of the first respondent and quash the impugned order dated 07.05.2013 made in O.P.No.MSEFC/CR/62/2011.)
The petitioner has filed this writ petition, challenging the order passed by the first respondent in O.P.No.MSEFC/CR/62/2011, dated 07.05.2013, whereunder it was directed to pay a sum of Rs.2,23,338/- together with compound interest with monthly rest at three time of the bank rate notified by the Reserve Bank of India as stipulated in Micro, Small and Medium Enterprises Development Act, 2006 (herein after mentioned as MSMED Act).
2. In his affidavit filed in support of the writ petition, petitioner submitted that the second respondent filed a petition before the first respondent alleging that a sum of Rs.2,23,338/- (Two lakhs twenty three thousand and three hundred and thirty eight only) was due to him from petitioner. According to the petitioner, the second respondent claimed that it was engaged in the activity of “Manufacturing of Speciality Chemicals for Wet Procession Applications in Textile Leather and other allied Indu
The conciliation proceedings contemplated under Section 18(2) of MSMED Act is mandatory in nature, and failure to comply with the mandatory procedure vitiates the impugned order.
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.
Writ petition not maintainable against MSMED Council orders; must challenge via Section 34 A&C Act with 75% pre-deposit.
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 mandatory nature of the pre-deposit requirement under Section 19 of the MSMED Act and the discretion of the court to permit the buyer to remit the amount in installments.
The court ruled that a party to a dispute cannot waive the mandatory conciliation requirement under Section 18(2) of the MSMED Act, validating subsequent arbitration proceedings.
The absence of proper arbitration proceedings by the MSEF Council renders its decision invalid, allowing for judicial review of the matter under writ jurisdiction.
The central legal point established in the judgment is the importance of following the prescribed procedures and principles of natural justice in arbitration proceedings under the MSME Act and the Ar....
Orders by MSEFC failing to follow arbitration procedures under the MSMED Act are not valid awards, allowing for writ petitions under Article 226 due to natural justice violations.
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