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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
APARESH KUMAR SINGH
Vishwa Samudra Engineering Pvt. Ltd., Telangana, India – Appellant
Versus
Aeon Infratel Pvt. Ltd., Jammu and Kashmir, India – Respondent
| Table of Content |
|---|
| 1. existence of arbitration clause and msefc proceedings. (Para 2 , 4) |
| 2. arguments for and against the appropriate forum for dispute resolution. (Para 5 , 6 , 8) |
| 3. court's findings on jurisdiction and prevailing legislation. (Para 10 , 12 , 13) |
| 4. court’s ruling and decision on the application. (Para 16 , 17) |
ORDER :
Heard Mr. Rajeev Rambhatla, learned counsel representing Ms. Sirnapelly Pooja, learned counsel for the applicant and Mr. K.Keertivardhan Reddy, learned counsel for the respondent.
3. In the present arbitration application, counter affidavit was filed by the respondent on 12.06.2025. Rejoinder thereto has been filed on 20.06.2025.
5. Learned counsel for the applicant also avers that on 01.02.2025, the respondent had approached the MSEFC under the MSMED Act as an afterthought to delay the arbitration proceedings despite knowing fully well that this is a works contract. Though a plea was taken that the respondent was not a registered MSME at the time of entering into the Sub-Contractor Agreement but that plea has not been pressed since the respondent had registered with the MSEFC on 27.04.2020.
7. According to the applicant, the respondent’s approach to the MSEF
The MSMED Act operates as a special beneficial legislation, overriding the Arbitration Act in cases involving registered MSMEs, emphasizing exclusive jurisdiction of MSEFC for dispute resolution.
The court upheld that statutory remedies under the MSMED Act take precedence over private arbitration agreements, affirming the Facilitation Council’s jurisdiction in disputes involving MSMEs.
The Facilitation Council lacks jurisdiction over disputes arising from works contracts under the MSME Act, and principles of natural justice must be adhered to in adjudicatory processes.
The MSEFC lacks jurisdiction to adjudicate disputes arising from works contracts, which necessitate arbitration under traditional frameworks, not the MSMED Act.
The Arbitration and Conciliation Act, 1996 is overridden by the MSMED Act, 2006, establishing the jurisdiction of the Facilitation Council for disputes, thereby necessitating adherence to its terms o....
The registration under the MSMED Act, 2006 applies prospectively and not retrospectively, and the benefits of the Act do not apply if the registration is obtained subsequently to the agreement and th....
The arbitration agreement's designation of venue and exclusive jurisdiction prevails over statutory arbitration under the MSMED Act, and the statutory arbitration does not override the parties' agree....
The Micro, Small and Medium Enterprises Development Act has precedence over the Arbitration and Conciliation Act, allowing parties to reference disputes to the MSEFC despite existing arbitration agre....
Works contracts cannot invoke the jurisdiction of MSEFC under the MSMED Act, necessitating arbitration under the Arbitration and Conciliation Act, thereby rendering MSEFC proceedings void.
Section 34 of the Arbitration Act arises as is evident from sub Section (6) of Section 16 of the Arbitration Act, which inter alia provides that the parties aggrieved by such an arbitral award may ma....
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