The absence of proper arbitration proceedings by the MSEF Council renders its decision invalid, allowing for judicial review of the matter under writ jurisdiction.

JUDGMENT :

Chakradhari Sharan Singh, CJ.

This matter is taken up through Hybrid mode.

2. A decision of Micro and Small Enterprises Facilitation Council, Cuttack (in short, "MSEF Council‟) in MSEFC Case No.51 of 2019 dated 30.12.2020 purported to be an award under Section 18 (3) of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) read with the provisions of Arbitration and Conciliation Act, 1996 (in short, "Arbitration Act‟) was put to challenge by the Orissa State Cooperative Marketing Federation Limited (respondent No.1 herein), by filing a writ petition, giving rise to W.P.(C) No.39436 of 2021.

3. A learned Single Judge of this Court has set aside the said decision of the MSEF Council as illegal and not in accordance with law on the ground that there had been no arbitration proceeding conducted by the MSEF Council as stipulated under sub-section (3) of Section 18 of the MSMED Act, by a judgment and order dated 29.04.2022 passed in W.P.(C) No.39436 of 2021, which is under challenge in the present intra-Court appeal.

4. It is noteworthy at this juncture that Section 19 of the MSMED Act provides that no application for setting aside any decree, award or order either by the MSEF Council or by any institution or center providing alternative dispute resolution services to which a reference is made by the MSEF Council, shall be entertained by any Court unless the appellant (not being a supplier) had deposited with it 75% of the amount in terms of the decree or award or, as the case may be, the other order in the manner directed by such Court. The appellant assailed the impugned order of the learned Single Judge solely on the ground that the respondent had remedy of challenging the award made by the MSEF Council in accordance with the provisions under Section 34 of the Arbitration Act and the learned Single Judge ought not to have interfered with the award of the Council in a proceeding under Article226 of the Constitution of India.

5. The primordial question which the present case involves is as to whether the impugned decision of the MSEF Council can be treated to an award under the provisions of the Arbitration Act, in the given facts and circumstances, applying the provisions under the MSMED Act. If the answer to the said question is in affirmative, the writ petition ought not to have been entertained. However, if the said decision of the MSEF Council, which was under challenge before the learned Single Judge cannot be treated to be an award within the meaning of the provisions of the Arbitration Act, it could not be a subject matter of challenge under the provisions of the Arbitration Act. In such circumstance, the interference by the learned Single Judge cannot be said to be unjustified. With this premise in mind, we proceed to address relevant facts and statutory provisions concerning this case.

6. We have heard at length Mr. S.P. Mishra, learned Senior Advocate along with Ms. Sakshi Rout, learned counsel appearing for the appellant and Mr. Dayananda Mohapatra, learned counsel appearing on behalf of the respondents.

7. It is noted at the outset that in the background of the stand on behalf of the Respondents that there was no arbitration proceeding at all held by the MSEF Council, and the purported award was passed in a conciliation proceeding though the conciliation had failed, we had deemed it proper to call for the original records in MSEFC Case No.51 of 2019. The original records have been produced before us, which we have perused.

8. Before delineating brief facts of the case leading to institution of W.P.(C) No.39436 of 2021, we deem it proper to address the relevant statutory pr