General Manager, Bharat Sanchar Nigam Limited v. Tirupati Stationers Private Limited
2016-01-28
SHREE CHANDRASHEKHAR
body2016
DigiLaw.ai
ORDER : 1. Aggrieved by award dated 21.07.2011 in Claim Petition No. 25 of 2008 whereby, the U.P. State Micro and Small Enterprises Facilitation Council, Kanpur awarded Rs. 1,84,193/- as principal sum and Rs. 3,38,838/- as interest upto 19.05.2010, the present writ petition has been filed. 2. Heard the learned counsel for the parties. 3. Raising a question of jurisdiction of the U.P. State Micro and Small Enterprises Facilitation Council, Kanpur, to entertain Claim Petition No. 25 of 2008, the learned counsel for the petitioner submits that the contract was executed at Ranchi, the supply was made at Ranchi, the bills were submitted at Ranchi and payment was made to the respondent-M/s. Tirupati Stationers Private Limited at Ranchi however, the claim petition was filed before the Facilitation Council at Kanpur and it was entertained. It is contended that in terms of Section 20 of the Micro, Small and Medium Enterprises Development Act, 2006, the State of Jharkhand has yet not issued notification for establishment of one or more Micro and Small Enterprises Facilitation Council still, the claim petition for which whole cause of action arose at Ranchi was entertained. 4. Briefly stated, the respondent preferred Claim Petition No. 25 of 2008 claiming Rs. 1,62,260/-as difference in tax, Rs. 1,34,190/- as freight charges and Rs. 21,931/- as outstanding payment with interest of Rs. 87,240/-. The respondent carries business of manufacture of computer stationery, photocopy papers, T.P. Rolls, Fax Rolls, duplicate papers etc. For supply of computer stationery on DGS&D rates, the petitioner agreed to release payment within 30 days against Form C/D. Raising a grievance that the petitioner-BSNL did not release Form C, CST etc. the claim petition was filed by the respondent. 5. Section 20 of the Micro, Small and Medium Enterprises Development Act, 2006 provides that the State Government shall, by notification, establish one or more Micro and Small Enterprises Facilitation Councils at such places, exercising such jurisdiction and for such areas, as may be specified in the notification. The composition of the Micro and Small Enterprises Facilitation Council under Section 21 includes Director of Industries or any other Officer not below the rank of Director in the Department of the State Government having administrative control over the small-scale industries or Micro Small and Medium Enterprises.
The composition of the Micro and Small Enterprises Facilitation Council under Section 21 includes Director of Industries or any other Officer not below the rank of Director in the Department of the State Government having administrative control over the small-scale industries or Micro Small and Medium Enterprises. The fact that the Micro and Small Enterprises Facilitation Council can be established by a notification of the State Government and Director of Industries or any other Officer not below the rank of Director in the Department of the State Government is one of the members of the Facilitation Council who shall act as Chairperson of the Council leads to a conclusion that challenge to the award of the Facilitation Council can be adjudicated by the High Court within whose jurisdiction the Facilitation Council is situated and it is exercising jurisdiction within such areas which fall within the territorial jurisdiction of the said High Court. Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 provides that the Arbitration and Conciliation Act, 1996 shall apply to the dispute referred for arbitration under sub-section (3) and it shall be deemed as if the arbitration was in pursuance of an arbitration agreement referred to in sub-section (1) of Section 7 of the 1996 Act. In Fuerst Day Lawson Ltd. vs. Jindal Exports Ltd. (2011) 8 SCC 333 , it has been noticed that the Arbitration Act has been held to be a self-contained Code. In Bharat Aluminium Company vs. Kaiser Aluminium Technical Services Inc. & Others, (2012) 9 SCC 552 , the Hon'ble Supreme Court has observed that the provisions under Section 2(1)(e), Section 20 and Section 28 r/w Section 45 of the 1996 Act have to be interpreted by keeping the principle of territoriality at the forefront. With reference to a case in which arbitration is held at place A though, the subject-matter of the suit is situated at place B, it has been held that both the courts would have jurisdiction i.e. the Court within whose jurisdiction the subject-matter of the suit is situated and the Court within the jurisdiction of which the dispute resolution i.e. arbitration is located.
Thus, it has to be held that challenge to the award made by the Micro and Small Enterprises Facilitation Council must be made in a Court of competent jurisdiction within the territorial the jurisdiction of which the Council is situated and exercising jurisdiction or in a Court within whose jurisdiction the subject-matter is situated. 6. Considering the fact that the award in Claim Petition No. 25 of 2008 has been made by the U.P. Micro and Small Enterprises Facilitation Council, Kanpur which does not fall within the territorial jurisdiction of the High Court of Jharkhand and subject-matter for arbitration is a claim for money, the present writ petition is held not maintainable and accordingly, it is dismissed.