Delhi High Court
The Executive Engineer & Ors. vs M/S Bholasingh Jaiprakash ... on 29 April, 2024
Author: Manmeet Pritam Singh Arora
Bench: Manmeet Pritam Singh Arora
$~1
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ LPA 318/2024, CM APPL. 23375/2024, CM APPL. 23376/2024, CM
APPL. 23377/2024 & CM APPL. 23378/2024
THE EXECUTIVE ENGINEER & ORS. ..... Appellants
Through: Mr. Atul Nigam and Ms. Tanvi
Nigam, Advocates
versus
M/S BHOLASINGH JAIPRAKASH CONSTRCUTION LTD. &
ANR. ..... Respondents
Through: Mr. Sudhir Nandrajog Senior
Advocate with Mr. Sujit Kumar
Singh, Advocate for R-1
Mr. Avishkar Singhvi ASC, Mr
Naved Ahmed, Mr. Vivek Kumar
Singh and Mr. Shubham Kumar,
Advocates for R-2
% Date of Decision: 29th April, 2024
CORAM:
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
JUDGMENT
MANMOHAN, ACJ : (ORAL)
CM APPL. 23377/2024 (for exemption)
Allowed, subject to all just exceptions.
Accordingly, the present application stands disposed of.
LPA 318/2024, CM APPL. 23375/2024, CM APPL. 23376/2024 & CM
1. Present letters patent appeal has been filed challenging the judgment
dated 16th February, 2024 passed by the learned Single Judge of this Court
in W.P. (C)14378/2023, whereby the writ petition filed by the appellant,
challenging the arbitration proceedings initiated by Respondent No. 1
company under the Micro, Small and Medium Enterprise Development Act,
2006 ("MSMED Act"), was dismissed on the ground that the appellant has
failed to invoke other remedies under the law.
2. Learned counsel for the appellant submits that under Articles 226 &
227 of the Constitution, this Court has the power to correct jurisdictional
errors and set aside the arbitral award. Relying upon Whirlpool Corporation
v. Registrar of Trade Marks, (1998) 8 SCC 1 and JSW Steel Ltd. v.
Kamlakar V. Salvi and Others 2021 SCC OnLine Bom 3113, he submits
that remedy by way of writ petition is available where the impugned order
has been passed by a court which inherently lacks jurisdiction. According to
him, an alternative remedy does not act as a bar in circumstances when the
proceedings are without jurisdiction. He contends that the appellant vide
letter dated 16th August, 2022 had challenged the jurisdiction of the arbitral
tribunal. He states that the arbitral tribunal failed to consider the objection.
3. He states that the learned Single Judge has failed to consider that
respondent no. 1 could not have availed benefits of MSMED Act for
contracts executed prior to registration under Section 8(1) of the MSMED
Act. He points out that the contract was executed on 27th August, 2005,
whereas respondent no. 1 was registered as MSME on 20th May, 2017.
Relying upon the judgment of the Supreme Court in Silpi Industries v.
Kerala State Road Transport Corporation, 2021 SCC OnLine SC 439, he
submits that provisions of MSMED Act cannot be applied retrospectively as
registration under the MSMED Act is prospective.
4. Upon a perusal of the paper book, this Court finds that the arbitral
award was passed ex-parte. The appellants chose to not appear before the
tribunal or file any application under Section 16 of the Arbitration and
Conciliation Act, 1996 ('the Act'). Further, the Appellants have not
challenged the award under Section 34 of the Act.
5. In the opinion of this Court, the proper recourse against proceedings
under the MSMED Act is to file an application under Section 18(3) of the
MSMED Act or Section 16 of the Act and in case an award has been passed,
then the proper recourse is to file objections under Section 34 of the Act.
6. Recently, in LPA 91/2024, this Court has refused to interfere with the
judgment passed by the learned Single Judge in similar circumstances. This
Court, while dismissing the appeal, relied upon the judgment of the Supreme
Court in Civil Appeal No. 7491/2023, titled as M/s India Glycols limited
and Anr. v. Micro and Small Enterprises Facilitation Council, Medchal
Malkajgiri and Ors., wherein it was held that petitions filed under Article
226/227 of the Constitution of India ought not to be entertained in view of
Section 18 of the MSMED Act, which provides for recourse to statutory
remedy for challenging the Award under Section 34 of the Act. The
Supreme Court in the said case has observed that entertaining of petitions
under Article 226/227 of the Constitution, in order to obviate compliance
with the requirement of pre-deposit under Section 19 of the Act, would
defeat the object and purpose of special enactment which has been legislated
upon by Parliament.
7. Consequently, the present appeal along with pending applications is
dismissed.
ACTING CHIEF JUSTICE
MANMEET PRITAM SINGH ARORA, J
APRIL 29, 2024/hp/sk
