Uniseven Engineering And Infrastructure Pvt. Ltd. Vs Micro And Small Enterprises Facilitation (MSEF) Council District (South) And Anr. (Delhi High Court)
The Delhi High Court considered whether, under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), a buyer can independently invoke the jurisdiction of the Micro and Small Enterprises Facilitation Council (MSEFC) against a supplier.
The petition was filed by Uniseven Engineering and Infrastructure Pvt. Ltd., challenging the MSEFC District (South), GNCTD order dated 14 September 2021, which advised the petitioner to pay Rs. 9,59,66,352 to Harji Engineering Works Pvt. Ltd. under agreements dated 17 and 18 October 2019. Under the agreements, Harji Engineering Works was the Buyer and Uniseven Engineering was the Supplier for Combined Station Works, including Civil, Mechanical, Electrical and Instrumentation works at Paradip and Balasore Stations in Odisha.
Disputes arose concerning the performance and payments under the agreements. Harji Engineering issued a legal notice on 10 July 2021 and subsequently encashed the petitioner’s bank guarantee on 12 July 2021. The Buyer thereafter invoked Section 18 of the MSMED Act and filed a reference before the MSEFC. The MSEFC subsequently directed payment of Rs. 9,59,66,352. The High Court stayed the impugned order on 1 October 2021.
