Supplier's Alleged Non-Registration Under MSMED Act Does Not Nullify Arbitral Award: J&K High Court

The High Court of Jammu, Kashmir and Ladakh on 30 September held that an arbitral award passed under the Micro, Small and Medium Enterprises Development Act, 2006 does not become a nullity merely because the supplier was allegedly not registered under the Act when the underlying transaction took place. Justice Sanjay Dhar dismissed three revision petitions filed by Kashmir Confectionary Store, Mehak Trading Co. and Naugraein Traders, challenging the execution of arbitral awards obtained by...

Gulf Trade Disruptions: Rajasthan HC Issues Notice On MSME's Challenge To RELIEF Scheme Cut-Off Date

The Rajasthan High Court has recently issued notices to the government on a petition challenging the cut-off under Component III of the Resilience and Logistics Intervention for Export Facilitation (RELIEF) Scheme, which restricts reimbursement support to shipments having Onboard Bills of Lading issued between February 14, 2026 and March 15, 2026.A Division Bench of Justices Inderjeet Singh and Sandeep Taneja was hearing a petition filed by Agrim Overseas, an MSME exporter of perishable...

Personal Loans Cannot Be Treated As MSME Borrowings Merely Due To MSME Link: Karnataka High Court

The Karnataka High Court has ruled that personal loans taken by borrowers cannot be treated as MSME borrowings merely because they are connected with an MSME.“The benefit available to an MSME must be considered in relation to the enterprise and the credit facility covered by the framework. Independent personal borrowings do not acquire the character of MSME borrowings merely because the borrowers are also connected with an MSME,” Justice Lalitha Kanneganti observed.The court was dealing with a...

Award Debtor Cannot Sidestep Mandatory 75% Deposit To Challenge MSME Award Through Execution Objections: Telengana HC

The Telangana High Court has held that an award debtor cannot use execution-stage objections to sidestep the mandatory 75% deposit required under the MSMED Act. The ruling came in a dispute between MSME supplier Atlantis Agritech Private Limited and Kendriya Bhandar, after the latter sought to keep asset-disclosure proceedings in abeyance pending its application under Section 47 of the Code of Civil Procedure before the Executing Court. The High Court held that such proceedings cannot be...

MSME Council Location Does Not Determine Court's Jurisdiction In Post-Award Proceedings: Calcutta HIgh Court

The Calcutta High Court has reiterated that the location of an MSME Facilitation Council does not, by itself, determine the territorial jurisdiction of courts over proceedings arising from an arbitral award.Applying this principle, the court held that an exclusive-jurisdiction clause in favour of the New Delhi courts governed a Section 29A application seeking an extension of the arbitral mandate after an award was passed by the West Bengal Micro Small Enterprises Facilitation Council (WBMSEFC),...

Calcutta High Court Says MSME Can't Seek Revival Benefit After SARFAESI Action, Rejects Debpara Claim

The Calcutta High Court on 2 September dismissed a writ petition filed by Debpara Tea Company Ltd against State Bank of India (SBI), which sought the benefit of the Framework for Revival and Rehabilitation of Micro, Small and Medium Enterprises (MSMEs) and challenged the classification of its account as a Non-Performing Asset (NPA). Justice Krishna Rao held that an MSME cannot seek the benefit of the Framework at a belated stage after the bank has issued a notice under Section 13(4) of the...

MSME Borrower Can't Raise Revival Framework Defence In Subsequent SARFAESI Case: Kerala High Court

The Kerala High Court on 1 September held that an MSME borrower cannot invoke the MSME revival and rehabilitation framework for the first time in subsequent litigation to challenge SARFAESI proceedings when the borrower failed to raise the issue in the first round of litigation. A Division Bench of Chief Justice Soumen Sen and Justice Syam Kumar V.M. upheld the dismissal of a writ petition filed by Soubhagye Road Builders and its proprietors against recovery proceedings initiated by Canara Bank...

MSME Council Must Follow Mandatory Arbitration Process Before Passing Award: Madras High Court

On 19 August, the Madras High Court held that an award passed by the Chennai Region Micro, Small and Medium Enterprises Facilitation Council without initiating arbitration as required under Section 18(3) of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) cannot be sustained. Justice P.B. Balaji set aside the Rs. 33.40 lakh award passed in favour of Mahalakshmi Trading Corporation against 3F Industries Ltd., holding that the Council had proceeded straight to an “Award”...

MSME Council Cannot Hear Buyer's Claims Over Defective Supply By MSME Supplier: Madras High Court

The Madras High Court has recently ruled that the Micro and Small Enterprises Facilitation Council cannot deal with a buyer's claim against an MSME supplier for defective or failed supply. Such claims fall outside the recovery mechanism under the Micro, Small and Medium Enterprises Development Act, 2006.Justice K. Kumaresh Babu observed, “The MSMED Act restricts itself to the scope of recovery of unpaid amount that is liable to be paid by the buyer under Section 15 together with interest under...

MSME Supplier's Interest Claim Cannot Be Denied Merely Because Principal Dues Are Paid: Gauhati High Court

The Gauhati High Court has recently ruled that an MSME supplier's claim for statutory interest on delayed payments cannot be disregarded merely because the principal contractual amount has subsequently been paid.Justice Kaushik Goswami observed, “Section 17 of the MSMED Act expressly makes the buyer liable to pay the amount due together with interest thereon as provided under Section 16. Therefore, subject to verification of the relevant dates of acceptance/deemed acceptance and the period of...

MSME Council Cannot Decide Post-Award Enforcement Disputes: Gujarat High Court

The Gujarat High Court on 6 August, held that a Micro and Small Enterprises Facilitation Council becomes functus officio after passing an arbitral award and cannot thereafter adjudicate disputes concerning enforcement of the award or determine whether the awarded amount has been fully paid. A Division Bench comprising Chief Justice Sunita Agarwal and Justice D.N. Ray modified a Single Judge's order directing the Madhya Pradesh MSME Facilitation Council to reconsider Mahakali Foods Pvt. Ltd.'s...

MSME Suppliers To Get At Least 50% Of Award If Court Challenge Takes Over Six Months Under New Amendment

MSME suppliers will be entitled to receive at least 50% of an awarded amount if an application to set aside a decree, award, other order, or mediated settlement agreement remains pending for more than six months under the Micro, Small, and Medium Enterprises Development (Amendment) Act, 2026, once the provision comes into force.The bill was introduced in the Rajya Sabha on July 28 by the Union Minister for Micro, Small and Medium Enterprises Jitan Ram Manjhi. It was passed by the Rajya Sabha on...