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2023 Supreme(Online)(KER) 26401

HIGH COURT OF KERALA
K VINOD CHANDRAN, C. JAYACHANDRAN, JJ
STEPHAN MATHEW – Appellant
Versus
M/S. P.B. BOARDS – Respondent
WA 251 2023



Advocates:
ADV SONNYMON K. MATHEW, ADV R.LAKSHMI NARAYAN, SMT.RANJANIE R, SRI.T.K.VIPINDAS, SR.G.P., SRI.BABU JOSEPH KURUVATHAZHA, SRI.T.NAVEEN

Acknowledgment certificates under the M.S.M.E. Act permit commencement of business operations for three years without immediate permits, reflecting the Act's purpose to facilitate small enterprises.

Headnote:

M.S.M.E. - Plywood Manufacturing - Kerala Micro, Small and Medium Enterprises Facilitation Act, 2019 - Sections 5, 6, 10, 12 - The court interprets the mechanisms of acknowledgment certificates and their effect, establishing that such certificates permit operations without immediate licenses, thus informing the dismissal of appeals regarding their validity.

Fact of the Case:

An appellant challenged acknowledgment certificates issued to two plywood manufacturing entities claiming violations of various laws. Concurrently, the entities sought police protection to operate their businesses, emphasizing that they were operating lawfully under the M.S.M.E. Act.

Issues: The key issues revolved around the legality of the issued acknowledgment certificates under the M.S.M.E. Act and the right to police protection for the operation of the plywood units amidst opposition.

Ratio Decidendi: The court held that the acknowledgment under the M.S.M.E. Act effectively legitimizes operations without immediate statutory approvals for an initial period, emphasizing the Act's facilitative intent for small enterprises.

Final Decision: The appeals were dismissed, affirming the validity of the acknowledgment certificates and the right to police protection for the entrepreneurs.

J U D G M E N T

C.Jayachandran, J.

Three writ petitions were disposed of by a learned Single Judge as per common judgment dated 07.04.2022 and we have three appeals before us, numbered as above. One Stephan Mathew is the appellant in all the three appeals. The writ petition first in point of time is W.P(C).no.13342/2021 preferred by the said Stephan Mathew and three others, challenging Ext.P5 'Acknowledgment Certificates' issued to two entities by name 'TVM Boards' and 'PB Boards' (represented by respondents 9 to 13) under the Kerala Micro, Small and Medium Enterprises Facilitation Act, 2019 ['the M.S.M.E. Act', for short]. The writ petitioners sought for a mandamus revoking Ext.P5 Acknowledgment Certificates, simultaneous with issuance of a similar writ directing respondents 1 to 8 authorities to shut down the proposed plywood units of the said two entities. Writ petitions 1975/2022 and 2039/2022 were preferred by M/s. P B Boards and M/s. TVM Boards respectively, seeking police protection to the respective petitioners and their workers and also for developing the property and construction of building therein. In both the writ petitions, the appellant herein was the third respondent. By the impugned common judgment, the first writ petition was dismissed and the two writ petitions seeking police protection were allowed.

2. We may now briefly refer to the contentions in the writ petitions. In the first writ petition preferred by the appellant herein, the contention raised was that preliminary works to set up plywood manufacturing units in the name and style M/s. TVM Boards and M/s. P B Boards are done in violation of all laws and the respondent authorities are not taking any action to prevent the same. The specific contention raised was the possibility of pollution, as is created by other plywood units run by respondents 9 to 13 in the writ petition. It was alleged that land development permit from the Grama Panchayath concerned was not obtained. Violation of the Kerala Panchayath Building Rules and Kerala Land Utilization Order 1967 was alleged. It was contended that the disputed land is not situated in an industrial area. A mass representation was preferred vide Ext.P2, but of no avail. After considerable delay, Ext.P3 resolution was taken by the Grama Panchayath against the alleged illegal activities of the respondents 9 to 13 and directing first respondent/Secretary to initiate urgent steps to stop the illegal works in the disputed land. On a mass representation preferred, the 8th respondent District Collector issued a direction to the first respondent/Secretary to initiate necessary action.

But no action ensued. Respondents 9 to 13 managed to obtain Ext.P5 Acknowledgment Certificates from the 6th respondent (G.M, District Industries Centre) for M/s. P B Boards and M/s. TVM Boards, so as to legitimize their illegal activities. Consequently, the 4th respondent officer of the Pollution Control Board issued Ext.P6 'consent to establish'. The area is a farmers' village and not an industrial one and Ext.P6 consent was issued unmindful of the said fact. On such premise, the reliefs afore-referred were sought for.

3. The 9th respondent filed counter affidavit on behalf of respondents 9 to 13, contending that the writ petition is not maintainable in view of the alternate remedy contemplated under S.12 of the M.S.M.E. Act. The Certificates of Acknowledgment received under the M.S.M.E. Act for the two entities were produced vide Exts.R9(c) and R9(f) respectively. Similarly, the 'consent to establish'

issued by the Pollution Control Board were produced at Exts.R9(b) and R9(e) respectively. On the basis of the acknowledgment, it was contended that there exists a deemed sanction to set and run the enterprise for three years, apart from a further period of six months, within which, the necessary licenses need to be procured. S.10(2) of the M.S.M.E. Act was pressed into service to point out the overriding effect of the said Act over the Ker

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