Electrosteel Steels Limited Through ... vs The State Of Jharkhand Through ... on 11 November, 2016

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Jharkhand High Court

Electrosteel Steels Limited Through ... vs The State Of Jharkhand Through ... on 11 November, 2016

Bench: Aparesh Kumar Singh

                     IN THE HIGH COURT OF JHARKHAND AT RANCHI.
                                 W.P.(C) No. 3699 of 2015
                                           ......
        Electrosteel Steels Limited.                      .... Petitioner.
                                         Versus
        The State of Jharkhand & Ors.                     .... Respondents
                                          .......

          CORAM: HON'BLE MR. JUSTICE APARESH KUMAR SINGH

                For the Petitioner      : Mr. Indrajit Sinha, Advocate
                For the State           : JC to GP III
                For the Pvt. Respondent : Mr. Rajiv Ranjan, Sr. Advocate
                                          Mr. Shresth Gautam, Advocate
                                         .......

                      I.A. No.6203 of 2016

08/11.11.2016

Counsel for the petitioner, while pressing the instant interlocutory application, has confined his prayer to the challenge to the provisions of Rule-4(1) of the Jharkhand Micro and Small Enterprises Facilitation Council Rules, 2007 notified vide resolution no.620 dated 19th March, 2008 wherein it has been provided that the number of the members of the Facilitation Council would not be less than 5 but shall not be more than 9 members to be appointed from the enumerated categories. Referring to provisions of Section 21 of the MSME Act of 2006, it is submitted that the Parliament in the Parent Act has clearly stipulated in mandatory terms that the Facilitation Council shall consist of not less than 3 but not more than 5 members to be appointed from amongst the categories enumerated therein (i) to (iv). It is submitted that the instant provision of 2007 Rules is ultravires the Parent Act. It is further submitted that the Council, as such, has been constituted with 9 members. It is, however, also fairly stated that this plea was not raised by the petitioner in the case of M/s G.P.T. Infraprojects Limited & Anr. Vrs. State of Jharkhand & Ors. in W.P.(C) No.06/2014 decided by this Court on 3rd March, 2016. It is submitted that though the plea of coram was taken in that case at the relevant point of time, but it was erroneously -2- stated that the State Government has failed to frame any rules laying down procedure to be followed by the Council under its rule making power. In those circumstances, the plea was rejected by this Court leaving it to the said petitioners to avail the remedy provided under Section 34 of the Arbitration and Conciliation Act, 1996 to lay challenge to the award of the Facilitation Council. It is submitted that the question being of the vires of the rules itself, the proposed amendment may be allowed to be incorporated in the main writ application.

Counsel for the respondent-State and the private respondent have objected to the prayer. It is submitted that the question of coram of Facilitation Council can also be raised before the Court where challenge to the award under Section 34 of the Act of 1996 can be made as it is one of the specific grounds of challenge available under the said provisions.

Learned counsel for the petitioner has also raised the plea of maintainability of the application by the private respondent before the Facilitation Council on the ground that though its claim related to year 2009 onwards except one claim, but it had registered itself as a supplier before the District Industry Centre under the provisions of the Act of 2006 only on 5.4.2013 for 'Transportation and General Construction Work' and on 29th January, 2015 for 'Placement Supply of Service of Personnel'. The application was, therefore, not maintainable in the Council.

These issues have, however, also been objected by the counsel for the respondents on the ground that Facilitation Council, exercising the rule of Arbitral Tribunal, is entitled to rule on its own jurisdiction which can be a ground of challenge under Section 34 of the Act of 1996 in terms of Section 16.

-3-

Be that as it may, since a challenge has been laid to the provisions of 2007 Rules on the specific grounds noted herein above, the proposed amendments are allowed in the manner indicated herein above.

Let an amended writ petition be filed with adequate copies as the matter is now required to be referred to the learned Division Bench in terms of Rule 34 of the Jharkhand High Court Rules.

Let amended petition be filed and copies thereof be also supplied to the counsel for the other parties within a period of two weeks. The parties may have the opportunity to respond to the amended writ petition thereafter.

The matter is accordingly referred to the learned Division Bench. I.A. No.6203 of 2016 stands disposed of accordingly.

(Aparesh Kumar Singh, J.) Shamim/

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