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2020 DIGILAW 1734 (PNJ)

Landmarks Sign Board Private Limited v. State Of Punjab

2020-09-23

ARUN MONGA

body2020
JUDGMENT 1. Inter alia contends that petitioner company, a registered Micro, Small Medium Enterprise ('MSME'), was completely misled into supplying goods to the respondent-State of Punjab, owing to the tall claim made while executing the contract dated 24.12.2019 that, qua the supply, 100% payment shall be released within 10 days of issuance of Consignee Receipt and Acceptance Certificate (CRAC) and submission of bills. 2. Learned counsel also relies on clause 1.10 of the contract, which apparently induced the petitioner to believe that State Government had the financial worthiness to pay within stipulated period. Notwithstanding that the entire consignment (17,000 white boards to be used by the Education Department across 8,500 locations in the State) has been concededly received by the State Government, the payment has not been disbursed till date. 3. Learned counsel further contends that stringent protections under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) have been envisaged to promote/support MSME industry, inasmuch as, delay in payment entitles an MSME to be paid three times compounded interest on the prevalent RBI interests in the country. 4. Learned counsel submits that entire principal payment of Rs. 11,33,90,000/- has been withheld without any plausible reasoning. She submits that owning to the said non-payment, petitioner MSME is not only on the extinct of closure but, also has to pay Rs.l0 lakhs per month as interest to its bankers and other private lenders qua the supplies made to the State Government. She further submits that had the petitioner known, prior to executing the contract, that State Government, owing to its past track record of persistent delays in payment, was notified/black listed on the defaulters list displayed on web portal of the Government e-Marketplace (GeM), the current situation would not have arisen, as the petitioner would have been more cautious and perhaps not supplied the goods in question. Notice of motion. 5. Ms. Sudeeepti Sharma, Additional A.G., Punjab on service of advance copy of the petition appears and accepts notice and seeks time to file a reply. 6. She submits that the present petition has been filed prematurely, as a reference dated 23.07.2020 (Annexure P-l) under the MSMED Act, preferred by the petitioner is already pending with the MSME Council. Per the Act, the same is to be decided within 90 days. The said period is yet not over. 7. 6. She submits that the present petition has been filed prematurely, as a reference dated 23.07.2020 (Annexure P-l) under the MSMED Act, preferred by the petitioner is already pending with the MSME Council. Per the Act, the same is to be decided within 90 days. The said period is yet not over. 7. While on the other hand, learned counsel for the petitioner points out that currently there is no MSME Council operational in the state of Punjab. She submits that even though MSME Council is existent on paper but no hearings are currently being conducted. Being remedy less, instant petition is, therefore, the only recourse available to the petitioner. 8. My attention has been drawn by learned counsel for the petitioner to written statement (Annexure P-24) filed in response to the reference pending before Micro and Small Enterprises Facilitation Council (MSEFC), wherein, it is unequivocally stated/admitted as below:- "That the office of the respondent has again requested Deputy Controller Finance and Account Office of DPI (Elementary Education), Punjab to release the payment of claimant vide letter dated 17.06.2020 and similarly again reminder was issued on 30.06.2020 and 22.07.2020. Copies of Letter dated 17.06.2020, 30.06.2020 and 22.07.2020 are annexed as Annexure R-2 (colly.)." 9. In view of the aforesaid conceded stand of the respondents, I am constrained to observe that the entire dilly-dally qua non-payment of the principal amount seems to have arisen out of inadequacy/financial unworthiness of the respondent state. For which, the petitioner is unnecessarily being embroiled into the administrative rigmarole/red-tape and, being made to run from pillar to post, including approaching this Court. 10. In the aforesaid premise, respondent No.5 is directed to file a short affidavit of its Administrative Secretary on or before 25.09.2020 spelling out a schedule of all the admitted payments to be made to the petitioner, in terms of the stand taken in the written statement filed before the MSME Council. In case, short affidavit is not possible due to paucity of time, respondent No.5, Secretary, Department of Finance, Punjab is directed to personally join the proceedings through video conference. Adjourned to 25.09.2020.