Madhya Pradesh High Court
M/S Zionhills Homes Private Limited A ... vs Madhya Pradesh Micro And Small ... on 20 January, 2025
Author: Vishal Dhagat
Bench: Vishal Dhagat
NEUTRAL CITATION NO. 2025:MPHC-JBP:3476
1 WP-22745-2023
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VISHAL DHAGAT
ON THE 20th OF JANUARY, 2025
WRIT PETITION No. 22745 of 2023
M/S ZIONHILLS HOMES PRIVATE LIMITED A COMPANY
INCORPORATED UNDER THE COMPANIES ACT 1956
Versus
MADHYA PRADESH MICRO AND SMALL ENTERPRISES
FACILITATION COUNCIL AND OTHERS
Appearance:
Shri Harjas Singh Chhabra - Advocate for petitioner.
Shri Satyendra Jain - Advocate for respondent No.2.
WITH
WRIT PETITION No. 22750 of 2023
M/S ZIONHILLS HOMES PRIVATE LIMITED
Versus
MADHYA PRADESH MICRO AND SMALL ENTERPRISES
FACILITATION COUNCIL AND OTHERS
Appearance:
Shri Harjas Singh Chhabra - Advocate for petitioner.
Shri Satyendra Jain - Advocate for respondent No.2.
ORDER
Petitioner has filed these petitions under Article 226 of Constitution of
India challenging order dated 28/07/2023 contained in Annexure P-8.
2. Respondent No.2 had made a reference for non-payment of his dues
before Micro and Small Enterprises Facilitation Council. Award was passed
in favour of petitioner vide order dated 28/07/2023.
3. A preliminary objection was raised by counsel appearing for
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respondent No.2 regarding maintainability of Writ Petition against the award
passed by Facilitation Council. It is submitted by him that order is appealable
and petitioner is required to pay statutory pre-deposits before filing of appeal.
Learned counsel placed reliance on judgment passed by Apex Court in case
of M/s India Glycols Limited and Another Vs. Micro and Small Enterprises
Facilitation Council, Medchal - Malkajgiri and Others, reported in 2023 SCC
OnLine SC 1852. It is further submitted that there is specific provision of
appeal under Section 19 of The Micro, Small and Medium Enterprises
Development Act, 2006 (for short "MSMED Act, 2006") against the award
of Facilitation Council and any appeal can only be entertained on deposit of
75% of the amount in terms of award. Remedy is available to petitioner
under Section 34 of Arbitration and Conciliation Act, 1996. In view of same
Court may not entertain petition under Article 226 of Constitution of India.
4. Counsel appearing for petitioner submitted that there is procedural
impropriety in passing award. Procedure as established by Law was not
followed and further no arbitration was carried out, therefore, petition under
Article 226 of Constitution of India is maintainable and judgment passed by
Apex Court will not come in way of petitioner.
5. Heard learned counsel for the parties.
6. Section 18 of MSMED Act, 2006 is quoted as under :
"18. Reference to Micro and Small Enterprises Facilitation
Council - (1) Notwithstanding anything contained in any other law
for the time being in force, any party to a dispute may, with regard
to any amount due under section 17, make a reference to the
Micro and Small Enterprises Facilitation Council.
(2) On receipt of a reference under sub-section (1), the Council
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shall either itself conduct conciliation in the matter or seek the
assistance of any institution or centre providing alternate dispute
resolution services by making a reference to such an institution or
centre, for conducting conciliation and the provisions of sections
65 to 81 of the Arbitration and Conciliation Act, 1996 (26 of
1996) shall apply to such a dispute as if the conciliation was
initiated under Part III of that Act.
(3) Where the conciliation initiated under sub-section (2) is not
successful and stands terminated without any settlement between
the parties, the Council shall either itself take up the dispute for
arbitration or refer it to any institution or centre providing
alternate dispute resolution services for such arbitration and the
provisions of the Arbitration and Conciliation Act, 1996 (26 of
1996) shall then apply to the dispute as if the arbitration was in
pursuance of an arbitration agreement referred to in sub-section
(1) of section 7 of that Act.
(4) Notwithstanding anything contained in any other law for the
time being in force, the Micro and Small Enterprises Facilitation
Council or the centre providing alternate dispute resolution
services shall have jurisdiction to act as an Arbitrator or
Conciliator under this section in a dispute between the supplier
located within its jurisdiction and a buyer located anywhere in
India.
(5) Every reference made under this section shall be decided
within a period of ninety days from the date of making such a
reference."
7. As per aforesaid provision council after receiving reference shall
conduct a meditation itself or refer the matter to any mediation service
provider under Medication Act, 2023. Where mediation initiated under Sub-
Section 2 is not successful and stands terminated without settlement between
parties, council shall take up dispute for arbitration or refer it to the center
providing ADR services in accordance with Arbitration and Conciliation
Act, 1996.
8. Counsel appearing for respondent No.2 had relied upon judgment
passed by Apex Court in case of M/s India Glycols Limited (supra) . In said
case Apex Court has affirmed the order passed by Division Bench of
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Telangana High Court. In said case Telangana High Court refused to
entertain the Writ Petition in view of availability of alternate remedy.
Supreme Court examining the said judgment held that Writ Petition is not
maintainable.
9. Case in hand is similar to that of case in M/s India Glycols Limited
(supra). Petitioner is having a remedy to prefer an application under Section
34 of Arbitration and Conciliation Act,1996 after paying 75% of the amount
in terms of award. If petitioner wants to challenge the said award, petitioner
is at liberty to prefer an application under Section 34 of Arbitration and
Conciliation Act, 1996 alongwith the statutory deposit required.
10. In view of above, petition stands dismissed.
(VISHAL DHAGAT)
JUDGE
as
