IMPORTANT POINT
A writ petition challenging an award under the MSME Act is not maintainable unless the petitioner deposits 75% of the awarded amount, as mandated by Section 19 of the MSME Act, 2006.

JUDGMENT :

1. Heard Sri S.T. Raja, learned counsel assisted by Sri P.K. Upadhyay, for the petitioners, Sri Rajiv Gupta, learned Additional Chief Standing Counsel for respondents no.1 and 2 and Sri Kartikeya Saran, learned counsel for respondent no.3.

2. The instant writ petition under Article 226 of the Constitution of India has been filed challenging the order dated 01.01.2024 whereby respondent no.2 (Zonal Micro and Small Enterprises, Facilitation Council (MSEFC), Meerut Zone, Meerut) (for short 'the Facilitation Council') has declared an award of a total sum of Rs.1,49,48,762/-in favour of respondent no.3, in exercise of powers under Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 (for short 'the MSME Act, 2006).

3. The case of the petitioners is that respondent no.3, being a registered firm, approached the petitioners pursuant to an e-tender dated 04.01.2021 for supply of 11 KV Vertical Gang Operated Air breaks switch with composite polymer insulator, single square pole transformer structure material with clamp and 11 KV Solid Core type GH fuse sets for HVDS and a contract deed/ purchase order No.146 dated 19.01.2021 came to be executed. The petitioners issued purchase order dated 26.02.2021 asking respondent no.3 to supply the goods and it is alleged that respondent no.3 failed to supply the goods as per the terms and conditions of the supply order. The petitioners, accordingly, issued a letter dated 15.03.2022 to respondent no.3 with regard to non supply of goods, however, respondent no.3 approached the Facilitation Council by making a reference on 05.04.2022 under Section 18 of the MSME Act, 2006. While the reference was pending, respondent no.3 approached this Court by filing Writ-C No.11981 of 2022 claiming various reliefs. The writ petition was disposed of by a Coordinate Bench of this Court by order dated 19.07.2022 with an observation that the Authority under Section 18 of the MSME Act, 2006 shall decide the reference application in accordance with law within a period of four weeks from the date of receipt of the order. It is in pursuance of the order dated 19.07.2022 passed by this Court that the impugned award has been declared by the Facilitation Council.

4. Respondent no. 3 raised preliminary objection with regard to maintainability of the writ petition on the ground of availability of alternative remedy of filing objections against the impugned award under Section 34 of the Arbitration and Conciliation Act, 1996, read with Section 18(3) of the MSME Act, 2006. Additionally, it is also contended that unless 75% of the amount in terms of impugned award is deposited by the petitioners, the challenge would not be maintainable in view of Section 19 of the MSME Act, 2006. In support of his submission, he places reliance on the judgment of Supreme Court in the case of M/s India Clycols Limited and another Vs. Micro and Small Enterprises Facilitation Council, Medchal -Malkajgiri and others in Civil Appeal No.7491 of 2023, arising out of SLP (C) No.9899 of 2023, decided on 06.11.2023.

5. Per contra, learned counsel for the petitioners submitted that the impugned award is ex parte as on the last date of hearing, the video link was not sent to the counsel for the petitioners. According to him, the video link was sent at the head office of the petitioner-company and to its officers, ignoring the request of the counsel to send video link to him, as arguments were to be advanced by him only. It is urged that since the impugned award has been rendered in violation of principles of natural justice, therefore, availability of alternative remedy of filing objection under Section 34 of the Act of 1996 would not debar the petitioners from invoking the writ jurisdiction. In respect of condition relating to pre-deposit of 75% of the amount, he submits that since the petitioner is a Government company, therefore, the said condition be dispensed with. He even did not accept the suggestion of the Court to deposit