- (1.) The legality and/or validity of an award dated February 10, 2012 passed by the West Bengal State Micro & Small Enterprises Facilitation Council (hereafter the Council) in purported exercise of power conferred by Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 (hereafter the 2006 Act) is under challenge in this writ petition at the instance of the petitioning company. It was a respondent in a reference that arose out of a claim for money lodged by the fourth respondent herein. The award required the petitioning company to pay to the fourth respondent Rs.1,02,41,730.27 (Rs.9,47,752/-on account of outstanding principal amount together with interest of Rs.92,93,978.27) within one month from the date of communication of the same.
(2.) Preliminary objections to the maintainability of the writ petition were raised by Mr. Chaturvedi, learned advocate for the fourth respondent and Mr. Sen, learned senior advocate appearing for the first respondent. The points are: 1. Since in terms of Section 18 of the 2006 Act the Council acted as an arbitrator and its award dated February 10, 2012 for all intents and purposes is an award within the meaning of the Arbitration and Conciliation Act, 1996 (hereafter the 1996 Act), the remedy of the petitioning company lay in filing an application under Section 34 of the 1996 Act for having such award set aside and Section 34 being the only remedy available to the petitioning company on facts and in the circumstances, the writ petition may not be entertained. 2. The writ petition suffers from unexplained delay and laches. The writ court has been approached only after the fourth respondent presented an application for execution of the impugned award and since the petitioning company allowed third party interest to accrue over the years, the writ court ought to be loath to interfere and the fourth respondent would be subjected to immense hardship and inconvenience if at this belated stage the writ petition is entertained. 3. Although the award is that of the Council, the petitioning company has not impleaded the Council as a respondent; therefore, the writ petition suffers from non-joinder of a necessary party and as such the writ petition is liable to dismissal.
(3.) Mr. Sengupta, learned senior advocate representing the petitioning company responded to the preliminary objections by submitting as follows: 1. What his adversaries perceive to be an award is in substance an order of the Council only; it is really not an award. By appearance the order may look like an award but in reality it is a mere cloak. The reference has been decided by the Council in a manner that is completely contrary to the statutory mandate in Section 18 of the 2006 Act. Referring to sub-sections (2) and (3) of Section 18, it was submitted that an arbitration could have commenced only after a process of conciliation that is initiated between the parties and required to be conducted in terms of the provisions of Section 65 to 81 of the 1996 Act is not successful and stands terminated without any settlement between them. Stressing on the words "shall then" in sub-section (3), it was submitted that the parties were not informed of termination of conciliation and the commencement of arbitration in terms thereof, and the order purporting to decide the dispute between the private parties without any opportunity of hearing not being an award at all, question of taking recourse to Section 34 of the 1996 Act does not and cannot arise. 2. The petitioning company did not feel affected by the order of the Council so long the application for execution was not presented by the fourth respondent and immediately after the execution application was presented before the High Court at Madras did the petitioning company consider it proper to invoke the writ jurisdiction to have the said order set aside. There has, accordingly, been no delay in presentation of the writ petition. 3. The Chairperson and the Director of the Council being parties to the writ petition, non-impleadment of the Council as a respondent should not be considered fatal and since the Court has wide powers, leave can always and may be granted to implead the Council as a respondent.;