MSME Facilitation Council Ex Parte Award Challenge Rejected Due to Statutory Remedy: Orissa High Court
Summary: The Orissa High Court considered a writ petition challenging an ex parte award dated 16 November 2019 passed by the Micro and Small Enterprises Facilitation Council, Odisha, in MSEFC Case No. 9 of 2019. The petitioner contended that the award had been made without complying with the statutory requirements under Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006. According to the petitioner, the alleged procedural and jurisdictional defects justified interference under Article 226 of the Constitution of India, notwithstanding the availability of an alternative statutory remedy.
The High Court examined the objection in the light of Section 19 of the MSMED Act, which provides a statutory mechanism for challenging awards of the Facilitation Council. The Court relied on the Supreme Court’s decision in Goodyear India Limited v. Norton Intech Rubbers (P) Ltd. and referred to earlier decisions involving SOUTHCO, Trupti Automotives and Jindal Steel and Power. It observed that the availability of a statutory remedy was a sufficient reason not to entertain the writ petition, particularly because the alleged jurisdictional error could also be examined by the competent forum. The Court therefore declined to exercise its extraordinary writ jurisdiction merely because the petitioner characterised the Council’s decision as jurisdictionally defective.
While disposing of the writ petition, the High Court protected the petitioner’s opportunity to pursue the statutory remedy. It directed that if the petitioner approached the appropriate authority within three weeks and submitted an application for condonation of delay, the delay should be condoned by taking a liberal view, considering that the matter had remained pending before the High Court. The challenge was to be decided in accordance with law within a reasonable time. The Court did not independently adjudicate the validity of the ex parte award or determine whether the Council had complied with every requirement of Section 18.
Cases Discussed:
- Goodyear India Limited v. Norton Intech Rubbers (P) Ltd. and Others — 2012 (2) CTC 829 (Supreme Court of India).
- The Deputy General Manager, SOUTHCO v. Director of Industries and Others — W.P.(C) No. 19024 of 2018, decided on 16 September 2019 (Orissa High Court).
- SOUTHCO Utility and Others v. Director of Industries and Others — SLP(C) No. 10248 of 2020, disposed of on 26 October 2020 (Supreme Court of India).
- Trupti Automotives v. Micro and Small Enterprises Facilitation Council, Cuttack — W.P.(C) No. 11145 of 2019, decided on 13 December 2019 (Orissa High Court).
- Jindal Steel and Power v. Micro and Small Enterprises Facilitation Council, Cuttack — W.P.(C) No. 6328 of 2016, decided on 19 May 2016 (Orissa High Court).
FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT
1. This matter is taken up through Hybrid Arrangement (Virtual/Physical Mode).
2. Heard Mr. Anupam Dwivedi, learned counsel for the petitioner and Mr. R.P. Mohapatra, learned Additional Government Advocate for the State.
3. This writ application has been filed challenging the ex parte award dated 16.11.2019 passed by the learned Micro & Small Enterprises Facilitation Council, Odisha in MSEFC Case No.9 of 2019.
4. Dwivedi, learned counsel for the petitioner, with vehemence submits that the impugned award has been passed without complying with the statutory provisions and with complete disregard to the ingredients of Section-18 of the Micro, Small and Medium Enterprises Development Act, 2006 (for short called as “MSMED Act”) and hence, the petitioner is entitled to be heard in the matter and this Court should interfere in the matter under Article- 226 of the Constitution of India.
5. However, as there is appeal provision U/S. 19 of the Act, I am not inclined to entertain this writ application, especially in view of the decision of Hon’ble the Supreme Court in the case of Goodyear India Limited vs. Norton Intech Rubbers (P) Ltd. and Ors., 2012 (2) CTC 829.
6. This Court has also disposed of several other matters in the light of the aforesaid decision of Hon’ble the Supreme Court, in the case of Goodyear India Limited. The Deputy General Manager, SOUTHCO vs. Director of Industries & Ors. in W.P.(C) No.19024 of 2018 disposed of on 16.09.2019, SOUTHCO UTILITY & ORS. vs. DIRECTOR OF INDUSTRIES & ORS., disposed of by Hon’ble the Supreme Court in Special Leave to Appeal (C) No.10248 of 2020 on 26.10.2020 and Trupti Automotives vs. Micro and Small Enterprises Facilitation Council, Cuttack, in W.P.(C) No.11145 of 2019 disposed of by this Court vide Order dated 13.12.2019, Jindal Steel and Power vs. Micro and Small Enterprises Facilitation Council, Cuttack, in W.P.(C) No.6328 of 2016 disposed of by this Court vide Order dated 19.05.2016.
7. Learned counsel for the petitioner submits that, there being gross jurisdictional error in deciding the matter U/S. 18 of the Act, the writ application is to lie.
8. There being, however, clear provision for appeal in Section-19 of the Act, where the jurisdictional error can also be gone into by the appellate authority, I do not find any force in such contention of learned counsel for the petitioner. Further, similar matters have been disposed of holding that, there being appeal provision, a petition under Article- 226 of the Constitution of India by-passing the appeal should Article- 226 of the Constitution of India by-passing the appeal should not be entertained.
9. I am supported by the decisions of this Court and Hon’ble the Supreme Court as quoted above.
10. In view of such fact, if the petitioner approaches the appellate authority within three weeks from today and files a petition for condonation of delay, the same be condoned, taking a liberal view of the matter, as the matter was pending before this Court and the appeal be disposed of in accordance with law within a reasonable time.
11. With the aforesaid observation, the writ application is disposed of.
12. Urgent certified copy of this Order be granted as per rules.
