ORDER : APARESH KUMAR SINGH, C.J. Heard Mr. Rajeev Rambhatla, learned counsel representing Ms. Sirnapelly Pooja, learned counsel for the applicant and Mr. K.Keertivardhan Reddy, learned counsel for the respondent. 2. The main issue in the present application is not on the existence of the agreement between the parties or the existence of the dispute between the parties, but the forum before which the dispute can be adjudicated. Applicant is the first party under a Sub-Contractor Agreement dated 04.06.2022, which contains an arbitration clause 49, which is also not disputed by the respondent. The issue, as observed hereinabove, is whether the Micro & Small Enterprises Facilitation Council, Jammu (hereinafter referred to as ‘MSEFC’) would be the proper forum or an independent arbitrator appointed by this Court would be the forum where the dispute between the parties is to be adjudicated. Respondent admittedly is a Micro, Small and Medium Enterprise (hereinafter referred to as “MSME”) registered with the MSEFC, Jammu, on 27.04.2020 under the erstwhile “MSME UDYOG AADHAAR” system, whose registration was further renewed with effect from 15.07.2022 under the new “MSME UDYAM” process. The Sub-Contractor Agreement was entered between the parties on 04.06.2022. In respect of the disputes between the parties, the respondent approached the learned Court of Munsiff, Samba, for perpetual injunction in which the applicant appeared and filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act of 1996”). By order dated 18.09.2024, the learned Court of Munsiff, Samba, accepted the objection of the applicant and disposed of the matter, as the agreement between the parties provided for arbitration clause. Thereafter, the respondent initiated proceedings under the Micro, Small and Medium Enterprises Development Act, 2006 (hereinafter referred to as ‘the MSMED Act’) before the MSEFC on 01.02.2025. On 15.02.2025, the respondent submitted hard copies of documents relating to the claims in response to the MSEFC’s requisition. The present applicant issued notice invoking arbitration clause through Registered Post on 17.02.2025, which returned due to “insufficient address”. Thereafter, on 25.02.2025, the applicant sent an e-mail notice to the respondent invoking arbitration clause. On 04.03.2025, the MSEFC issued notice to the applicant. The present arbitration application was filed on 13.03.2025 by the applicant wherein there was no mention of the proceedings before the MSEFC. Thereafter, on 25.02.2025, the applicant sent an e-mail notice to the respondent invoking arbitration clause. On 04.03.2025, the MSEFC issued notice to the applicant. The present arbitration application was filed on 13.03.2025 by the applicant wherein there was no mention of the proceedings before the MSEFC. Applicant also replied to the notice dated 04.03.2025 from the MSEFC on 17.03.2025 after filing of the arbitration application. 3. In the present arbitration application, counter affidavit was filed by the respondent on 12.06.2025. Rejoinder thereto has been filed on 20.06.2025. 4. On the part of the applicant, the following plea has been taken. That parties entered into a Sub-Contractor Agreement on 04.06.2022 for shifting of electrical utilities (including distribution and transmission) and water pipeline utilities in relation to the project titled “Construction of four/six lane access-controlled expressway from Gurha Baildaran to Junction with Jammu Ring Road (NH 244A) near Jakh village (468+100 km to 503+250) of Delhi Amritsar Katra Expressway”. The agreement was executed on an item rate contract basis, with the rates being based on the cost data of the Utility-owning department prevailing at the time of the agreement’s execution. Despite multiple extensions by the applicant in good faith, respondent failed to complete the work within stipulated timeframe of six months from the date of agreement i.e., by 04.12.2022. The respondent continued to raise running account bills from February, 2023 onwards, which were containing discrepancies. Therefore, applicant was compelled to terminate the Sub-Contractor Agreement vide notice dated 07.05.2024. Applicant has averred that notice invoking arbitration clause was issued on 07.02.2025 and 19.02.2025. Thereafter, the applicant filed application under Section 11 (5) and (6) of the Act of 1996 on 13.03.2025 before this Court. 5. Learned counsel for the applicant also avers that on 01.02.2025, the respondent had approached the MSEFC under the MSMED Act as an afterthought to delay the arbitration proceedings despite knowing fully well that this is a works contract. Though a plea was taken that the respondent was not a registered MSME at the time of entering into the Sub-Contractor Agreement but that plea has not been pressed since the respondent had registered with the MSEFC on 27.04.2020. 6. The following grounds have been taken by the applicant to assert that the arbitrator appointed by this Court under the arbitration clause between the parties is the right forum for adjudication of the dispute between the parties. 6. The following grounds have been taken by the applicant to assert that the arbitrator appointed by this Court under the arbitration clause between the parties is the right forum for adjudication of the dispute between the parties. It is contended that the nature of the Sub-Contractor Agreement is a works contract which involves not merely supply of goods or services but execution of works including installation, maintenance and handing over to Utility-owning agencies. In this regard, he has relied upon the decisions of the Hon’ble Supreme Court in CCE Customs v. Larsen & Toubro Limited, (2016) 1 SCC 170 and M/s. Kone Elevators India Private Limited v. State of Tamil Nadu , [ (2014) 7 SCC 1 ] to submit that (i) the performance under such a works contract is not divisible into an exclusive contract for supply of goods or services, but by a legal fiction, it is divided into parts for sale of goods and for supply of labour and services; (ii) the concept of a dominant nature test does not apply to works contract; (iii) as per Clause 29A of Article 336 of the Constitution of India, a works contract covers all genres of works contracts and (iv) the “overwhelming component test” would not apply to works of composite nature. It is submitted that the Hon’ble Supreme Court concluded that the nature of a works contract is distinct, indivisible and composite. Hence, a works contract is not amenable to the MSMED Act. He has also relied on the decision of the Bombay High Court in Sterling Wilson Pvt Limited v. Union of India , [2017 SCC OnLine Bom 6829] . 7. According to the applicant, the respondent’s approach to the MSEFC is abuse of process by forum shopping and an afterthought. It is further submitted that existence of arbitration clause 49 under the Sub-Contractor Agreement dated 04.06.2022 bars MSEFC proceedings. He has referred to the decision of the Hon’ble Supreme Court in Gujarat State Civil Supplies Corporation Limited v. Mahakali Foods (Private) Limited , [ (2023) 6 SCC 401 ] on the proposition that in order to make an application in the presence of arbitration agreement, proper registration and compliance with the acts and requirements are essential. Further submissions have been made on the merits of the dispute, which this Court is not required to enter into in the present proceedings. 8. Further submissions have been made on the merits of the dispute, which this Court is not required to enter into in the present proceedings. 8. On the part of the respondent, the following submissions have been made: 8.1. Lack of maintainability: Precedence of MSMED Act: a) It is submitted that the existence of pre-existing proceedings before the MSEFC, Jammu, concerning the same Sub-Contractor Agreement dated 04.06.2022, renders the present application under the Arbitration Act not maintainable. b) It is submitted that the respondent filed its application for dispute resolution before the MSEFC on 01.02.2025, even before the applicant had issued its purported notice under Section 21 of the Act of 1996 on 07.02.2025. c) It is submitted that MSMED Act is a special legislation intended to provide a speedy and specific resolution mechanism for MSMEs. The non-obstante clause in Section 24 of the MSMED Act mandates that its provisions prevail over any other Act, including the general provisions of the Act of 1996. d) The proposition of law stated above has been spelt out by the Hon’ble Supreme Court in Silpi Industries v. Kerala State Road Transport Corporation , (2021) 18 SCC 790 : 2021 SCC OnLine SC 439. 8.2. Refutation of works contract exclusion: a) It is submitted that the applicant’s argument that the MSMED Act is inapplicable because the contract is a ‘works contract’ is legally unsound and based on an incorrect premise, as clarified by the Calcutta High Court in Hindustan Petroleum Corporation Limited v. West Bengal State Micro, Small Enterprises Facilitation Council , [2023 SCC OnLine Cal 1700] b) It is submitted that the applicant’s reliance on the decisions of the Hon’ble Supreme Court in CCE Customs (supra) and M/s. Kone Elevators India Private Limited (supra) is misplaced. The Calcutta High Court observed that the proposition laid down in M/s. Kone Elevators India Private Limited (supra) was entirely in the context of the interpretation of Article 366 (29-A) of the Constitution of India and taxing statutes. The High Court found that applying this revenue jurisprudence concept to the beneficial MSMED Act is an erroneous misinterpretation. c) It is submitted that unlike taxing statutes which are interpreted strictly, beneficial legislations are to be interpreted liberally. The “pivot of adjudication” in the MSMED Act is “the nature of the enterprise which seeks the benefit of the statute” and not the nature of the transaction itself. c) It is submitted that unlike taxing statutes which are interpreted strictly, beneficial legislations are to be interpreted liberally. The “pivot of adjudication” in the MSMED Act is “the nature of the enterprise which seeks the benefit of the statute” and not the nature of the transaction itself. d) The Calcutta High Court also found that the MSMED Act makes no distinction that would exclude works contracts and that such a distinction would be artificial and contrary to the MSMED Act itself. e) The Calcutta High Court also held that the MSMED Act applies to registered enterprises engaging in selling goods, rendering services, or anyone of the two, or both together and applying concepts from revenue law to make a distinction of works contract would not be apt. f) The Calcutta High Court concluded that once an enterprise is duly registered under Section 8 (1) of the MSMED Act, it must attract the provisions of the MSMED Act, vesting authority on the MSMEFC to resolve disputes in that regard. g) The proposition of law laid out hereinabove has also been followed by the Delhi High Court in the case of Idemia Syscom India Private Limited v. Conjoinix Total Solutions Private Limited ,  2025 SCC OnLine Del 1023 which dealt with a similar contention wherein a petitioner to a Section 11 application contended that the jurisdiction of MSMED Act is ousted since the agreement is a ‘works contract’. The Delhi High Court rejected the contention. h) Thus, it is humbly submitted that the MSEFC, Jammu, has the requisite jurisdiction. 8.3. Multiplicity of proceedings: a) It is submitted that allowing this application would result in concurrent and parallel proceedings arising from the same contract and dispute, leading to the serious risk of conflicting awards, which is contrary to the object of expeditious dispute resolution under the MSMED Act. b) The principle of Kompetenz-Kompetenz empowers the MSEFC to decide whether it has jurisdiction to entertain all claims and counter-claims of the parties. This proposition of law has been reiterated by the Hon’ble Supreme Court in Gujarat State Civil Supplies Corporation Limited (supra). 8.4. Concealment of material facts and abuse of process: a) It is submitted that the applicant has approached this Court with unclean hands by deliberately suppressing the existence of the prior MSME proceedings. b) It is submitted that the respondent filed its application before the MSEFC on 01.02.2025. 8.4. Concealment of material facts and abuse of process: a) It is submitted that the applicant has approached this Court with unclean hands by deliberately suppressing the existence of the prior MSME proceedings. b) It is submitted that the respondent filed its application before the MSEFC on 01.02.2025. c) The applicant received the MSEFC’s notice dated 04.03.2025 and filed the present application on 13.03.2025, yet intentionally concealed this critical fact from this Court. d) Such concealment of material facts which challenge the very maintainability of the application, amounts to an abuse of the judicial process, warranting the dismissal of the application in limine with exemplary costs. 8.5. Prematurity and statutory non-compliance: a) It is submitted that the present application is premature and legally untenable for failure to comply with the mandatory 30-day waiting period prescribed by Section 11 (5) of the Act of 1996. b) The postal notices dated 07.02.2025 and 17.02.2025 were returned with the endorsement of “insufficient address”, demonstrating a failure of effective service to the respondent’s registered office. 9. Learned counsel for the respondent submits that the subject contract does not fall within the definition of “works contract”. In the present dispute, the performance under the Sub-Contractor Agreement is divisible unlike composite contract and the supply element of agreement is clearly divisible from the labour element, as is evident from the bills raised by the respondent also. It is further submitted that the Calcutta High Court in Hindustan Petroleum Corporation Limited (supra) has held that once an enterprise is duly registered under Section 8 (1) of the MSMED Act, it must attract the provisions of the MSMED Act vesting authority on the Council to resolve the dispute in that regard. The Calcutta High Court has distinguished the decision rendered in the case of M/s. Kone Elevators India Private Limited (supra) principle, as it was on the issue of taxation. It is submitted that unlike taxing statutes which are interpreted strictly, beneficial legislations are to be interpreted liberally. It is further submitted that the Calcutta High Court has also held that the MSMED Act makes no distinction to exclude works contract. Such a distinction would be artificial and contrary to the MSMED Act itself. It is submitted that unlike taxing statutes which are interpreted strictly, beneficial legislations are to be interpreted liberally. It is further submitted that the Calcutta High Court has also held that the MSMED Act makes no distinction to exclude works contract. Such a distinction would be artificial and contrary to the MSMED Act itself. Learned counsel for the respondent, therefore, submits that this Court may refrain from appointing an arbitrator in the present proceedings under Section 11 (5) & (6) of the Act of 1996 since the petitioner, being an MSME, has already invoked the jurisdiction of the MSEFC, Jammu. 10. I have considered the submissions of learned counsel for the parties and I have also taken note of the chronology of dates and events. I have also taken note of the relevant provisions of the MSMED Act, 2006 and the Arbitration and Conciliation Act, 1996 and perused the decisions relied upon by learned counsel for the parties. 11. The applicant though had taken the issue of non- registration of the applicant prior to invocation of the MSME Forum of MSEFC, Jammu, but that is not in dispute since the respondent had already registered before the MSEFC on 27.04.2020. 12. The issue which requires answer in the present proceedings is whether under the MSMED Act, the MSEFC would have jurisdiction to decide the dispute between the parties under the Sub-Contractor Agreement dated 04.06.2022, which contains an arbitration clause or the provision under the Act of 1996 would prevail for appointment of an arbitrator by this Court? 13. In this regard, this Court is of the considered view that the MSMED Act, being a special legislation intended to provide speedy and specific resolution mechanism for MSMEs, would prevail over the Act of 1996, more so, in view of the non-obstante clause in Section 24 of the MSMED Act. This issue has earlier been held by the Apex Court in the case of Silpi Industries (supra). Paragraph Nos.36 and 37 of the judgment is quoted hereunder: “ 36. This issue has earlier been held by the Apex Court in the case of Silpi Industries (supra). Paragraph Nos.36 and 37 of the judgment is quoted hereunder: “ 36. The obligations of the buyer to make payment, and award of interest at three times of the bank rate notified by Reserve Bank in the event of delay by the buyer and the mechanism for recovery and reference to Micro and Small Enterprises Facilitation Council and further remedies under the 2006 Act for the party aggrieved by the awards, are covered by Chapter V of the 2006 Act. The provisions of Sections 15 to 23 of the Act are given overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. From the Statement of Objects and Reasons also it is clear that it is a beneficial legislation to the small, medium and micro sector. The Arbitration and Conciliation Act, 1996 is a general law whereas the Micro, Small and Medium Enterprises Development Act, 2006 is a special beneficial legislation which is intended to benefit micro, small and medium enterprises covered by the said Act. 37. The 2006 Act contemplates a statutory arbitration when conciliation fails. A party which is covered by the provisions of 2006 Act allows a party to apply to the Council constituted under the Act to first conciliate and then arbitrate on the dispute between it and other parties. There are fundamental differences in the settlement mechanism under the 2006 Act and the 1996 Act. The first difference is, the Council constituted under the 2006 Act to undertake mandatory conciliation before the arbitration which is not so under the 1996 Act. Secondly, in the event of failure of conciliation under the 2006 Act, the Council or the centre or institution is identified by it for arbitration. The 1996 Act allows resolution of disputes by agreed forum. The third difference is that, in the event of award in favour of seller and if the same is to be challenged, there is a condition for pre-deposit of 75% of the amount awarded. Such is not the case in the 1996 Act. When such beneficial provisions are there in the special enactment, such benefits cannot be denied on the ground that counterclaim is not maintainable before the Council. Such is not the case in the 1996 Act. When such beneficial provisions are there in the special enactment, such benefits cannot be denied on the ground that counterclaim is not maintainable before the Council. In any case, whenever buyer wish to avoid the jurisdiction of the Council, the buyer can do on the specious plea of counterclaim, without responding to the claims of the seller. When the provisions of Sections 15 to 23 are given overriding effect under Section 24 of the Act and further the 2006 Act is a beneficial legislation, we are of the view that even the buyer, if any claim is there, can very well subject to the jurisdiction before the Council and make its claim/counterclaim as otherwise it will defeat the very objects of the Act which is a beneficial legislation to micro, small and medium enterprises. Even in cases where there is no agreement for resolution of disputes by way of arbitration, if the seller is a party covered by Micro, Small and Medium Enterprises Development Act, 2006 , if such party approaches the Council for resolution of dispute, the other party may approach the civil court or any other forum making claims on the same issue. If two parallel proceedings are allowed, it may result in conflicting findings.” 14. In a recent decision rendered by a Co-equal Bench of the Apex Court in the case of NBCC (India) Limited v. The State of West Bengal , [Appeal No.3705 of 2024, decided on 10.01.2025.] , the Apex Court has referred to the judgments in the cases of Silpi Industries (supra), Gujarat State Civil Supplies Corporation Limited (supra) and also the subsequent judgments in Vaishno Enterprises v. Hamilton Medical AG,  2022 SCC OnLine SC 355 and M/s Nitesh Estates Limited v. Micro and Small Enterprises Facilitation Council of Haryana , [C.A.No.5276/2022 @ SLP (C) No.26682/2018.] and held that they cannot be considered to be binding precedents on the issue of compulsory registration before initiation of proceedings under Section 18 of the MSMED Act. However, learned Division Bench of the Hon’ble Supreme Court had, in its concluding part, referred the matter to a Three-Judge Bench to ensure clarity and certainty about the applicable precedents on the subject. However, learned Division Bench of the Hon’ble Supreme Court had, in its concluding part, referred the matter to a Three-Judge Bench to ensure clarity and certainty about the applicable precedents on the subject. The Apex Court in the case of NBCC (India) Limited (supra) also held that for an effective judicial remedy under the constitutional scheme which is an integral part of access to justice, it should be accessible, affordable, expeditious and cohesive. When a statute provisioning a judicial remedy falls for construction, the choice of interpretative outcome is not governed so much by the power or privileges under the Constitution, but by the constitutional duties to create effective judicial remedies in furtherance of the right to access to justice. A meaningful interpretation that furthers effective judicial access is a constitutional imperative and it is this duty that must inform the interpretative criteria. The Apex Court then proceeded to examine the statutory scheme of the MSMED Act and at paragraph 14.3 of the judgment held that the purpose and object of Section 18 of the MSMED Act is to provide for a remedy for resolution of disputes. The remedy is provided by the statute, not by an agreement between the parties. It is, therefore, necessary to keep it unrestricted and open-ended, enabling any party to a dispute to access the remedy since the expression used in Section 18 of the MSMED Act is “any party to the dispute”. When statutory provision incorporating remedies for resolution of disputes falls for consideration, constitutional Courts must interpret such remedies in a manner that would effectuate access to justice. The Apex Court also dealt with the definition of “supplier” under Section 2(n) of the MSMED Act and at paragraph 14.4 held that a supplier will also be an entity engaged in selling goods or rendering services, produced or provided by a micro or small enterprise. Therefore, the definition of “supplier” encompasses not only those who have filed a memorandum, but also those who have not filed. As such, the Apex Court in the decision of NBCC (India) Ltd. (supra) furthered the legislative intent in the MSMED Act, which is a beneficial piece of legislation for MSMEs to adopt an interpretation which would not only reduce the hiatus between a right and a remedy, but also to ensure that the remedy is effective. If rights are recognition of a claim, remedies are their actualization. If rights are recognition of a claim, remedies are their actualization. While the rights regime receives broad recognition under our constitutional framework, it is imperative that remedies must keep pace and be strengthened. One of the core functions of the higher judiciary is to bridge the gap between rights and remedies and this would immediately give rise to the legislative, executive and judicial obligations for their provision, implementation and declaration respectively. 15. As such, this Court is of the firm view that in the facts and circumstances of the case, the respondent, being an MSME, has a right under the MSMED Act and the remedy provided under the MSMED Act also for settlement or adjudication of the dispute with its purchaser i.e., the applicant. Under the Scheme of the MSMED Act, Chapter V in relation to any claim of payment against supply of goods or services, ‘any party’ to the dispute can approach the Facilitation Council. Given the overriding provisions under Section 24 of the MSMED Act and the beneficial nature of the MSMED Act, the observations of the learned Court of Munsiff, Samba, in its order dated 18.09.2024 that there exist an arbitration clause under the Sub-Contractor Agreement dated 04.06.2022 between the parties would not come into the way of the respondent to invoke the forum of the MSEFC. The applicant has also raised a plea that the Sub-Contractor Agreement dated 04.06.2022 entered between the parties is in the nature of a works contract and therefore, it would not be amenable to the jurisdiction of the MSEFC. However, the decisions relied upon by the applicant i.e., in the cases of CCE Customs (supra) and M/s. Kone Elevators India Private Limited (supra) would not be applicable to the facts of the present case, as the issue of interplay of the Act of 1996 with that of Chapter V of the MSMED Act, which provides for a forum of adjudication of the dispute between the parties, one of whom is an MSME, was not an issue therein. The decision in CCE Customs (supra) was in relation to a taxation matter. As such, in this regard, the Calcutta High Court in its judgment rendered in the case of Hindustan Petroleum Corporation Limited (supra) has also taken a view that the MSMED Act makes no distinction to exclude works contract and other contracts. The decision in CCE Customs (supra) was in relation to a taxation matter. As such, in this regard, the Calcutta High Court in its judgment rendered in the case of Hindustan Petroleum Corporation Limited (supra) has also taken a view that the MSMED Act makes no distinction to exclude works contract and other contracts. It has also taken a view that the decision in M/s. Kone Elevators India Private Limited (supra) was on the proposition of interpretation of Article 366 (29-A) of the Constitution of India and taxing statutes. The application of taxation jurisprudence or revenue jurisprudence to the interpretation of the beneficial provisions of the MSMED Act would be erroneous. 16. Therefore, this Court is satisfied that the MSEFC would be the proper forum under the MSMED Act for settlement through conciliation or adjudication of the dispute between the parties. The respondent has invoked the jurisdiction of the MSEFC, Jammu, before invocation of the arbitration clause by the present applicant, as is evident from the chronology of dates and events noted hereinabove. In such circumstances, this Court should refrain from exercising its jurisdiction under Section 11 (5) and (6) of the Act of 1996 for appointment of an independent arbitrator in respect of the dispute between the parties. 17. The instant Arbitration Application is, accordingly, dismissed. However, there shall be no order as to costs. Miscellaneous applications pending, if any, shall stand closed.