IMPORTANT POINT
Pre-deposit of 75% of award amount is necessary for entertaining the appeal for setting aside an award under 2006 Act.

Judgment :

Four special leave petitions, being S.L.P. (C) Nos.16919-16920 of 2011 and S.L.P. (C) Nos.31468-31469 of 2011, have been filed against the judgment and order dated 10th June, 2011, passed by the Division Bench of the Madras High Court in O.S.A. No.119 of 2011 and M.P. No.1 of 2011, filed by M/s. Goodyear India Limited. The first two special leave petitions have been filed by M/s. Goodyear India Limited, while the other two have been filed by M/s. Norton Intech Rubbers (P) Ltd. The said appeal had been preferred by M/s. Goodyear India Limited against the order passed by the learned Single Judge on 7th April, 2011, in O.P. No.888 of 2010, which was an application to set aside an award under the Arbitration and Conciliation Act, 1996.

The main question which had arisen before the learned Single Judge was with regard to the provisions of Section 19 of the Micro, Small and Medium Enterprises Development Act, 2006 (for short, 2006 Act'), which provides for applications for setting aside decrees, awards or orders.

For the sake of reference, Section 19 is extracted hereinbelow:

"Application for setting aside decree, award or order.-- No application for setting aside any decree, award or other order made either by the Council itself or by any institution or centre providing alternate dispute resolution services to which a reference is made by the Council, shall be entertained by any court unless the appellant (not being a supplier) has deposited with it seventy-five per cent of the amount in terms of the decree, award or, as the case may be, the other order in the matter directed by such court:

Provided that pending disposal of the application to set aside the decree, award or order, the court shall order that such percentage of the amount deposited shall be paid to the supplier, as it considers reasonable under the circumstances of the case subject to such conditions as it deems necessary to impose."

As will be noticed, Section 19 provides that no application for setting aside any decree, award or other order made either by the Council, appointed under the 2006 Act, shall be entertained by any Court unless the appellant (not being a supplier) deposits with the Court seventy-five per cent of the amount in terms of the decree, award or as the case may be, the other order, in the manner directed by such court.

The learned Single Judge having considered the submissions made on the said provision came to the conclusion that on a plain reading of the Section, the Court had no discretion to either waive or reduce the amount of seventy-five per cent of the award as a pre-deposit for filing of the appeal and, accordingly, dismissed the original petition, with leave to the petitioner to deposit an amount, amounting to seventy-five per cent of the award, within an extended period of six weeks. The Division Bench before whom the aforesaid appeal was preferred concurred with the judgment of the learned Single Judge and while dismissing the appeal, extended the period for deposit of the aforesaid amount by a further period of six weeks.

Aggrieved by the aforesaid judgment and order of the Division Bench, as also that of the learned Single Judge, M/s. Goodyear India Limited, has preferred the first two special leave petitions. As far as Norton Intech Rubbers (P) Ltd. and another, are concerned, they have filed the special leave petitions on account of certain observations that had been made by the Division Bench while disposing of the appeal, which were likely to prejudice them. An objection had also been taken with regard to limitation, which had been decided against them.

In the two special leave petitions, which have been filed by M/s. Goodyear India Limited, once again the main thrust of the submissions made by Mr. M.G. Ramachandran, learned counsel appearing for the petitioner, was with regard to interpretation of the provisions of Section 19 of the 2006 Act. According to him, one of the questions of law which arise for conside