Case Law Details
Board of Trustees for Syama Prasad Mookerjee Port Vs Marinecraft Engineers Private Limited (Calcutta High Court)
The disputes between the parties pertain to the deductions made by the petitioner under diverse heads from the moneys which were due and payable to the respondent. The respondent being a unit entitled to the benefits of the Micro Small and Medium Enterprises Development Act, 2006 (MSMED Act) referred the disputes to the Council under Section 18 of the Act. The conciliation proceedings failed and the arbitration commenced before the Council. Subsequently, the petitioner raised an issue of jurisdiction inter alia contending that the Council could not adjudicate the disputes on the ground that the contract contained an arbitration clause, which had already been invoked by the respondent.
On behalf of the petitioner it is urged that, the order dated 12 May, 2021 is an interim award and is subject to challenge under Section 34 of the Act. It is also urged that the contract between the parties contains a multitier arbitration clause (Clause 18 of the agreement) and the respondent by a letter dated 16 January, 2015 had already invoked the arbitration clause. Hence, the Council had no jurisdiction to adjudicate upon the disputes.
On behalf of the respondent, it was urged that the provisions of the MSMED Act have an overriding effect and the Council has exclusive jurisdiction to conduct the proceedings. Moreover, it is contended that the impugned order is not an interim award within the meaning of the Arbitration and Conciliation Act, 1996. In any event, the impugned order pertains to the jurisdiction of the Tribunal. Thus, the drill of Section 16 (5) and Section 16 (6) of the Act has to be followed and the petitioner must await the passing of the final award. Hence, on the ground of maintainability, this application is liable to be rejected.
In my view, the impugned order relates to the Tribunal’s own jurisdiction. By the impugned order, the Council has held that “it does have jurisdiction to adjudicate the instant matter”. In passing the impugned order, the Council has interpreted the provisions of the MSMED Act and adjudicated upon whether the contractual arbitration clause gets overridden by the provisions of the MSMED Act.
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