Block Development Officer Pampady Block, AnikkadP.O., Kottayam v. Abraham KuriaKose and The Chairman, Micro and Small Enterprises Facilitation Council, Kerala

W.P.(C) No. 29212/2022 : 1 : IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE SHAJI P.CHALY WEDNESDAY, THE 29[TH] DAY OF MARCH 2023 / 8TH CHAITHRA, 1945 WP(C) NO. 29212 OF 2022 ## PETITIONER/S: THE BLOCK DEVELOPMENT OFFICER PAMPADY BLOCK, ANIKKAD P.O., KOTTAYAM, PIN – 686 503. BY ADV. SMT. K.R. DEEPA, SPL. GOVERNMENT PLEADER ## RESPONDENT/S: - 1 ABRAHAM KURIAKOSE PROPRIETOR, M/S. ENERGYSOL, VADAVATHOOR, P.O., KOTTAYAM, PIN – 686 503. - 2 THE CHAIRMAN, MICRO AND SMALL ENTERPRISES FACILITATION COUNCIL, KERALA, THIRUVANANTHAPURAM, PIN – 695 033. BY ADVS. ANIL SIVARAMAN RAJI VINCENT(K/34/1988) JOTHISHA K.A.(K/123/2022) THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 21.03.2023, THE COURT ON 29.03.2023 DELIVERED THE FOLLOWING: W.P.(C) No. 29212/2022 : 2 : ## **SHAJI P. CHALY, J.** --------------------------------------------------------W.P.(C). No. 29212 of 2022 --------------------------------------------------------Dated this the 29[RD] day of March, 2023. ## The writ petition is filed by the Block Development Officer (BDO), Pampady Block, Kottayam, challenging Exhibit P13 award dated 22.01.2022 in O.A. No. 54 of 2020 passed by the Micro and Small Enterprises Facilitation Council, Kerala. 2. As per the award, the appellant was directed to pay an amount of Rs.3,47,800/- along with compound interest calculated at three times of bank rate notified by the Reserve Bank as provided under Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006 from 22.10.2019 till the date of realization of the award. The legality and correctness of the said award is under challenge in this writ petition. 3. The paramount contention advanced by the petitioner is that the writ petitioner invited tender “A4/1041/17 Project No.2 - MPLADS (Member of Parliament Local Area Development Scheme) 2016-2017’, against which the first respondent contractor has submitted offer for the supply of the LED High Mast Light System for the use of the Block Development Officer, Pampady Block Panchayat. The writ petitioner has accepted the offer subject to the W.P.(C) No. 29212/2022 : 3 : conditions stipulated in the agreement executed by and between the parties in pursuance of the work order dated 28.02.2018 issued by the writ petitioner. 4. As per the agreement dated 18.04.2018, the item offered by the first respondent was the installation of the LED High Mast Light System with 12 meter High Mast pole, 4 numbers of 150 watts LED Flood light luminary and other allied items as per specifications attached with the agreement executed on 07.03.2019. 5. It is also stated that several complaints were received regarding the foundation work of the installation of the High Mast Light and the same was enquired by the petitioner with the first respondent. However, the enquiry was never answered by the first respondent. Other contentions were also raised. The contention put forth by the first respondent is that after the installation in accordance with the contract, several requests were made to pay the money, however the writ petitioner failed to pay the amount due as per the contract and the agreement executed. 6. Due to failure on the part of the writ petitioner to pay the amount, the petitioner had to approach the Micro and Small Enterprises Facilitation Council as provided under the provisions of the Act, 2006. It is further submitted that in spite of sufficient W.P.(C) No. 29212/2022 : 4 : opportunity made by the Facilitation Council, the respondent has failed to file any written statement and contest the proceedings. 7. Even though the matter was placed for conciliation, it has failed and thereafter, the Facilitation Council has proceeded with arbitration and has passed the award. Therefore, according to the learned counsel for the first respondent, the petitioner, having failed to challenge the award in accordance with the provisions of the Act, 2006 and the Rules, 2019, is not entitled to challenge the award by filing a writ petition. Therefore, the first question to be answered is whether the writ petition is maintainable under law. 8. I have heard the learned Special Government Pleader Smt. K.R Deepa for the petitioner and Sri. Anil Sivaraman for the first respondent, and perused the pleadings and material on record. 9. The issue is guided by the provisions of the Act, 2006. The Act, 2006 is an enactment introduced to provide for facilitating the promotion and development and enhancing the competitiveness of micro, small and medium enterprises and for matters connected therewith or incidental thereto. 10. There is no dispute that the first respondent is a registered MSE unit entitled to secure the benefits of the Act, 2006. Section 15 deals with 'the delayed payments to the Micro and Small Enterprises', which specifies that where any supplier supplies any W.P.(C) No. 29212/2022 : 5 : goods or renders any services to any buyer, the buyer shall make payment therefor on or before the date agreed upon between him and the supplier in writing or, where there is no agreement in this behalf, before the appointed day. The proviso thereto makes it clear that in no case the period agreed upon between the supplier and the buyer in writing shall exceed forty-five days from the day of acceptance or the day of deemed acceptance. 11. Section 16 dealing with ‘the date from which and rate at which interest is payable’, stipulates that where any buyer fails to make payment of the amount to the supplier, as required under section 15, the buyer shall, notwithstanding anything contained in any agreement between the buyer and the supplier or in any law for the time being in force, be liable to pay compound interest with monthly rests to the supplier on that amount from the appointed day or, as the case may be, from the date immediately following the date agreed upon, at three times of the bank rate notified by the Reserve Bank. 12. Section 17 further makes it clear that for any goods supplied or services rendered by the supplier, the buyer shall be liable to pay the amount with interest thereon as provided under Section 16. Section 18 dealing with ‘reference to Micro and Small Enterprises Facilitation Council’, is the provision to be discussed in W.P.(C) No. 29212/2022 : 6 : detail to identify the issue as to whether the writ petition is maintainable. It reads thus: ## “18. **Reference to Micro and Small Enterprises Facilitation Council.—** (1) .—(1) Notwithstanding anything contained in any other law for the time being in force, any party to a dispute may, with regard to any amount due under section 17, make a reference to the Micro and Small Enterprises Facilitation Council. (2) On receipt of a reference under sub-section (1), the Council shall either itself conduct conciliation in the matter or seek the assistance of any institution or centre providing alternate dispute resolution services by making a reference to such an institution or centre, for conducting conciliation and the provisions of sections 65 to 81 of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall apply to such a dispute as if the conciliation was initiated under Part III of that Act. (3) Where the conciliation initiated under sub-section (2) is not successful and stands terminated without any settlement between the parties, the Council shall either itself take up the dispute for arbitration or refer it to any institution or centre providing alternate dispute resolution services for such arbitration and the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall then apply to the dispute as if the arbitration was in pursuance of an arbitration agreement referred to in sub-section (1) of section 7 of that Act. (4) Notwithstanding anything contained in any other law for the time being in force, the Micro and Small Enterprises Facilitation Council or the centre providing alternate dispute resolution services W.P.(C) No. 29212/2022 : 7 : shall have jurisdiction to act as an Arbitrator or Conciliator under this section in a dispute between the supplier located within its jurisdiction and a buyer located anywhere in India. (5) Every reference made under this section shall be decided within a period of ninety days from the date of making such a reference. 13. Therefore, it is clear that when the money is not paid in terms of the agreement, the supplier is entitled to approach the Council in terms of the provisions of the Act, 2006. It was accordingly that the first respondent approached the Council. On a perusal of Exhibit P13 award, it is clear that the Facilitation Council has taken cognizance of the dispute in the year 2020 and issued statutory notices to the petitioner herein as well as the first respondent for appearing before the Council for the hearing held on 05.01.2021. It is also clear that the petitioner herein was also served with a copy of the Original Petition filed by the first respondent herein. 14. It is further clear that both the parties were present on the aforesaid sittings and the Council initiated conciliation proceedings. But, the conciliation failed, since the petitioner herein raised a complaint with respect to the work done by the first respondent. The grievance highlighted by the writ petitioner before the Facilitation Council was that it has received complaints from the public regarding the question of low quality standards of the W.P.(C) No. 29212/2022 : 8 : foundation of High Mast Light System and as per their version, the electrical installation was standing as a threat to life and safety of the public. However, the Council found that no valid proof has been submitted to substantiate the said issue by the writ petitioner. 15. Anyhow, in order to assess the genuineness of the allegation made by the writ petitioner, the Council sought a comprehensive report from the District Collector, Kottayam in that regard. Later, the case was taken up for arbitration by the Council on the sittings held on 09.02.2021, 24.04.2021, 28.07.2021 and 22.01.2022 and on all the sittings, both parties were present and the Council heard both the parties in detail. It is quite clear and evident from the award that the Council has considered each and every aspect and has arrived at the conclusion that the first respondent is entitled to recover the amount from the writ petitioner. Therefore, the contention advanced in the writ petition that the petitioner was not provided with an opportunity to contest the proceedings by the Facilitation Council, cannot be sustained under law. 16. I have evaluated the rival submission made across the Bar. In my considered opinion, there is a clear provision contained under Section 18(3) of the Act, 2006 that if the petitioner was aggrieved, the remedy available to the petitioner was to challenge W.P.(C) No. 29212/2022 : 9 : the award in terms of the provisions of the Arbitration and Conciliation Act, 1996. Therefore, the writ petition is not the remedy available to the petitioner, if he was aggrieved by the award. 17. The learned Special Government Pleader has invited my attention to the judgment of the Apex Court in _**Whirlpool Corporation v. Registrar of Trademarks, Mumbai and others**_ [(1998) 8 SCC 1] to contend that even though a remedy is provided under the statute, that will not debar the writ court from entertaining any application under Article 226 of the Constitution of India. So also, the judgment of the Apex Court in _**Harbanslal Sahnia and another v. Indian Oil Corporation Ltd. and others**_ [(2003) 2 SCC 107) was also pressed into service to highlight the said legal proposition. 18. But, in my considered opinion, the facts and circumstances of this case are entirely different and this is a case where the Facilitation Council has passed the award in accordance with the provisions of the Act, 2006 and sufficient opportunity was provided to the petitioner to participate in the proceedings. This is a case where the writ petition was filed when the first respondent filed Execution Petition No. 255 of 2022 in O.A.No. 54 of 2020 of MSEFC before the Principal District Court, Kottayam to execute the W.P.(C) No. 29212/2022 : 10 : award. 19. The question with respect to entertaining a writ petition against the award passed by the MSEF Council was considered by me in _**Sajith Kumar v. State of Kerala**_ [2019 (2) KLT Online 2052 = 2019(2) KLT SN 44 (C. No. 52)] and held that having failed to challenge the award in terms of the provisions of the Act, 2006, the aggrieved was not at liberty to invoke Article 226 of the Constitution of India to challenge the award passed by the Facilitation Council. Considering the facts and circumstances and the law discussed above, I have no hesitation to hold that the writ petition is not maintainable under law and accordingly, it is dismissed. sd/- **SHAJI P. CHALY, JUDGE.** Rv W.P.(C) No. 29212/2022 : 11 : ## **APPENDIX OF WP(C) 29212/2022** PETITIONER’S EXHIBITS: Exhibit1 TRUE COPY OF THE TENDER BY THE SECRETARY, PAMPADY BLOCK PANCHAYAT DATED 22.02.2018 Exhibit P2 TRUE COPY OF THE AGREEMENT DATED 18.04.2018 ENTERED INTO BETWEEN THE PETITIONER AND THE RESPONDENT. Exhibit P3 TRUE COPY OF SUPPLEMENTARY AGREEMENT EXECUTED ON 07. 03.2019 Exhibit P4 TRUE COPY OF SUPPLY ORDER DATED 26.02.2019 ISSUED BY THE BDO, PAMPADY Exhibit P5 TRUE COPY OF THE COMMUNICATION OF THE PETITIONER TO THE ASSISTANT EXECUTIVE ENGINEER, ELECTRICAL DIVISION, KOTTAYAM, DATED 09.07.2019 Exhibit P6 TRUE COPY OF THE COMMUNICATION FROM THE DISTRICT COLLECTOR REFERRING TO A WHATSAPP MESSAGE Exhibit P7 TRUE COPY OF THE LETTER DATED 05.07.2019 FROM THE ASSISTANT EXECUTIVE ENGINEER, ELECTRICAL DIVISION, KOTTAYAM Exhibit P8 TRUE COPY OF THE LETTER DATED 20.07.2019 TO THE RESPONDENT FROM THE BDO, PAMPADY Exhibit P9 TRUE COPY OF THE LETTER DATED 24.07.2019 TO THE RESPONDENT FROM THE BDO, PAMPADY Exhibit P10 TRUE COPY OF THE INVOICE DATED 06.09.2019 SUBMITTED BY THE RESPONDENT. Exhibit P11 TRUE COPY OF THE VALIDATION CERTIFICATE DATED 05.09.2019 FROM THE KSEB Exhibit P12 TRUE COPY OF THE COMMUNICATION DATED 17.02.2021 TO THE CHAIRMAN, MSEF COUNCIL, THIRUVANANTHAPURAM Exhibit P13 TRUE COPY OF THE AWARD PASSED BY THE MSEF COUNCIL IN OA 54/2020 DATED 22.01.2022 Exhibit14 TRUE COPY OF THE COMMUNICATION DATED 23.06.2022 TO THE CHAIRMAN, MSEF COUNCIL, THIRUVANANTHAPURAM Annexure 1 TRUE COPY OF THE NOTICE RECEIVED IN THE EP ALONG WITH THE COPY OF THE EXECUTION PETITION ## RESPONDENTS’ EXHIBITS: NIL True Copy PS To Judge. rv