M/S K K Electro Trade vs Sushil Agarwal
2023 Latest Caselaw 8876 Raj

[2023:RJ-JD:33820]

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Civil Writ Petition No. 3662/2022

M/s K K Electro Trade, Through Director/authorized Representative Krishan Kumar Bansal Aged 57 Years Registered Address At 36-37, Subhash Marg, Near Bagaria Bhawan, C- Scheme, Jaipur (Raj.) - 302001

----Petitioner Versus

1. Sushil Agarwal, For M/s Balaji Info Lube, 21, Residency Road, Jodhpur, Rajasthan - 342011 [email protected]

2. Rajasthan Micro And Small Enterprises Facilitation Council, Jodhpur Division, District Industries And Commerce Center, Mini Udhyog Bhawan, New Power House Road, Jodhpur-342003 E-Mail -

         [email protected]
                                                                    ----Respondents


For Petitioner(s)              :   Mr. Harsh Tikoo
For Respondent(s)              :   Mr. Ravi Bhansali Sr. Advocate
                                   assisted by Mr. Dhanesh Saraswat,
                                   Mr. Vipul Dharnia,
                                   Mr. Udit Mathur,
                                   Mr. Devan Maheshwari

HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI

Judgment

Reserved on 09/10/2023 Pronounced on 31/10/2023

1. This writ petition under Article 226 of the Constitution of

India has been preferred claiming the following reliefs:

"It is, therefore, most respectfully and humbly prayed that;

i) The instant petition for writ may kindly be ordered to be allowed and a writ, order or direction in the appropriate nature may kindly be issued in favour of the humble petitioner;

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ii) The impugned orders dated 29.09.2021 (Annexure-11) and order dated 24.11.2021 (Annexure-14) may kindly be suitably quashed and set-aside;

iii) The proceedings before Micro and Small Enterprises Facilitation Council, Rajasthan - IV, Jodhpur in case No.RJ/22/S/RJS/01043 bet set aside;

iv) Any other order which this Hon'ble Court may deems fit and proper in the facts and circumstances of the case also be passed in favor of humble petitioner along with cost of writ petition.

v) The cost of the writ petition may kindly be awarded in favour of the humble petitioner."

2. Brief facts of the case, as placed before this Court by learned

counsel for the petitioner, are that RajCOMP Info Services Ltd. (A

Government of Rajasthan Undertaking) invited bids for

Operational and Technical Support Services for GPS devices, in

pursuance whereof, the petitioner submitted its bid to Raj COMP

Info Services Ltd. on 07.09.2015 and the same was accepted,

whereupon work order was issued in favour of the petitioner on

02.09.2016. The petitioner approached the respondent no.1 for

coordinating and operational training support for operational &

technical services for GPS Devices for the period from 03.09.2016

to 02.03.2017.

2.1. The respondent no.1 provided the services in lieu of a sum of

Rs.11,81,952/-, and for the same an invoice was issued to the

petitioner. The petitioner paid only an amount of Rs. 3,43,890/- to

the respondent no.1. In respect of the remaining amount, the

respondent no.1 approached the Micro and Small Enterprises

Facilitation Council, Jaipur (hereinafter referred to as 'Council')

under Section 18 of the Micro, Small and Medium Enterprises

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Development Act, 2006 (hereinafter referred to as 'Act of 2006')

and the same was thereafter transferred to the Council at Jodhpur.

2.2. The petitioner filed an application before the Council

regarding the objection in relation to jurisdiction and the Council

proceeded with the matter and communicated to the petitioner to

participate in the arbitration and conciliation proceedings.

Thereafter, the Council vide order dated 29.09.2021 without

deciding the petitioner's objection, directed it to file the statement

of claim.

2.3. Subsequently, the Council passed an order dated 24.11.2021

in favour of the respondent no.1, and thereafter, the Council

passed the order/award dated 15.12.2021, directing the petitioner

to pay the due amount in question alongwith interest.

2.4. Thus, being aggrieved, the present petition has been

preferred claiming the afore-quoted reliefs.

3. Learned counsel for the petitioner submitted that the

respondent no.1 does not fall under the definition of 'supplier' as

provided under Section 2 (n) of the Act of 2006 because at the

time of the work order dated 02.09.2016 issued in favour of the

petitioner, the respondent no.1 was not a registered Unit, and

therefore, as per the definition of 'supplier', it is necessary that the

Unit concerned is registered as Small or Micro Enterprise.

For ready reference, Section 2(n) of the Act of 2006 is

reproduced as hereunder:-

"(n) "supplier" means a micro or small enterprise, which has filed a memorandum with the authority referred to in sub-section (1) of section 8, and includes,--

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(i) the National Small Industries Corporation, being a company, registered under the Companies Act, 1956 (1 of 1956);

(ii) the Small Industries Development Corporation of a State or a Union territory, by whatever name called, being a company registered under the Companies Act, 1956 (1 of 1956);

(iii) any company, co-operative society, trust or a body, by whatever name called, registered or constituted under any law for the time being in force and engaged in selling goods produced by micro or small enterprises and rendering services which are provided by such enterprises"

3.1. Learned counsel further submitted that the respondent no.1

applied for registration as Small Unit on 09.09.2016 and the work

order in question was issued on 02.09.2016, and therefore, it is

clear that the respondent no.1 was not even falling under the

definition of 'supplier'. It was also submitted that the concerned

Secretariat of the respondent no.1 itself gave a finding that the

respondent no.1 applied for the registration on 09.09.2016.

3.2. Learned counsel also submitted that once the respondent

no.1 did not fall under the definition of 'supplier', the learned

Council had no jurisdiction to entertain the application filed by the

respondent no.1.

3.3. In support of such submissions, learned counsel relied upon

the following judgments:-

(a) Anupam Industries Ltd. Vs The State Level Industry

Facilitation Council (R/Special Civil Application No. 2825 of 2020,

decided by the Hon'ble High Court of Gujarat on 16.12.2022);

(b) ITI Limited Vs The Union of India & Ors. (Writ Petition No.

5431 of 2023, decided by the Hon'ble High Court of Telengana on

28.03.2023);

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(c) Ashtriya Ispat Nigam Ltd. Vs. The Union of India (W.P. Nos.

27670 of 2022 and other connected matter decided by the Hon'ble

High Court of Andhra Pradesh on 26.04.2022); and

(d) Vaishno Enterprises Vs Hamilton Medical AG & Ors. (Civil

Appeal No. 1892 of 2022, decided by the Hon'ble Apex Court on

24.03.2022).

4. On the other hand, Mr. Ravi Bhansali, learned Senior Counsel

assisted by Mr. Dhanesh Saraswat, Mr. Vipul Dharnia, Mr. Udit

Mathur and Mr. Devan Maheshwari, appearing on behalf of the

respondents, while opposing the aforesaid submissions made on

behalf of the petitioner, submitted that in the present case, the

petitioner has only challenged the information of meeting

proceedings, and thereafter, the Council passed the award in

shape of an order, which was not placed on record initially.

Thereafter, as per learned Senior Counsel, in absence of any

challenge to the said award, the present petition is liable to be

dismissed.

4.1. It was further submitted that the present petition is not

maintainable because the award in question was passed under

Section 18 of the Act of 2006, and as per Section 18(3), such an

award can be challenged under the provisions of the Arbitration

and Conciliation Act, 1996. It was also submitted that the

petitioner did not avail the alternative remedy and directly

approached this Hon'ble Court, and therefore, on count of

availability of an alternative remedy, the present petition is liable

to be dismissed.

[2023:RJ-JD:33820] (6 of 8) [CW-3662/2022]

4.2. It was further submitted that the respondent no.1 got itself

registered under the Act of 2006 on 12.04.2016. As per learned

Senior Counsel, as and when the new product/service is being

added in the inventory/during the course of business, the

additions are being displayed on the site having online verification,

which shows the date of application as 09.09.2016, though the

Firm was registered as MSME on 12.04.2016 itself.

4.3. It was also submitted that at the time of the work order and

contract in question the, respondent no.1 was a registered unit,

and thus, no question arose as to the jurisdiction of the Council in

the present case.

4.4. In support of such submissions, reliance was placed upon the

following judgments:-

(a) Gujarat State Civil Suppliers Corporation Ltd. Vs Mahakali

Foods Pvt. Ltd. (Unit 2) & Anr. (2023) 6 SCC 401;

(b) Sanghi Industries Ltd. & Anr. Vs Micro Small Enterprises

Facilitation Council & Anr. (D.B. Special Appeal Writ No.

591/2018, decided on 26.04.2018 by a Division Bench of this

Hon'ble Court at Jaipur Bench);

(c) Marine Craft Engineers Pvt. Ltd. Vs Garden Reach

Shipbuilders and Engineers Ltd. (A.P. No. 831 of 2018 decided by

the Hon'ble High Court of Calcutta on 05.04.2023);

(d) Sterlite Power Transmission Ltd. Vs M/s EPC Solutions LLP &

Anr. (W.P. (C) 13758/2021 AND CM Appl.43444/2021, decided by

the Hon'ble High Court of Delhi on 05.04.2023);

(e) Silpi Industries & Ors. Vs Kerala State Road Transport

Corporation & Ors. AIR 2021 SC 5487; and

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(f) Metalman Auto Pvt. Ltd. Vs Micro and Small Entriprises

Facilitation Council (W.P. No. 29870 of 2022, decided by the

Hon'ble High Court of Madras on 25.01.2023).

5. Heard learned counsel for the parties as well as perused the

record of the case alongwith the judgments cited at the Bar.

6. This Court observes that the petitioner participated in the

bidding process, and upon acceptance of its bid, work order was

issued in favour of the petitioner on 02.09.2016. The respondent

no.1 provided the services in question from 03.09.2016 to

02.03.2017, in lieu of payment of a certain amount. Thereafter,

the petitioner did not pay the entire amount, and therefore, in

that regard, the respondent no.1 approached the Council, and

after conclusion of the proceedings before the Council, the

impugned orders were passed.

7. This Court further observes that the proceeding was

undertaken under Section 18 of the Act of 2006 and the award

was accordingly passed. This Court also observes that the

appropriate remedy for challenging the said award can be availed

as per the provisions of the Act of 2006.

8. This Court also observes that once the alternative remedy

was specifically mentioned in the statue, then it was not

permissible for the petitioner to bypass such remedy, so as to

enable it to invoke the writ jurisdiction of the Hon'ble Court. Such

course is not permissible, unless a grave injustice is established.

This Court further observes that the petitioner can raise all its

legal issues before the Appellate Authority concerned, and not

here in the present petition.

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9. Thus, in light of the aforesaid observations as well as looking

into the factual matrix of the present case, this Court does not

find it a fit case so as to grant any relief to the petitioner in the

present petition.

10. Consequently, the present petition is dismissed. However, the

petitioner shall be at liberty to approach the Appellate Authority

concerned, as provided under the law. It is needless to say that

the limitation period for the petitioner to approach the Appellate

Authority concerned shall be counted from today, and the

observations made taken by this Court shall not affect the merit of

case before the Appellant Authority. All pending applications

stand disposed of.

(DR. PUSHPENDRA SINGH BHATI),J SKant/-

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