J&K High Court Stays Award Issued Against Public Health Engineering Department

Jammu, Dec 2 (KNN) In a crucial ruling, the Jammu & Kashmir and Ladakh High Court has granted an interim stay on the enforcement of an arbitral award worth Rs 11.52 crore, which was issued against the Public Health Engineering (PHE) Department of the Union Territory. 

The decision, passed by Justice Wasim Sadiq Nargal, halts the enforcement of the award until further proceedings in the case.

The interim relief was granted after the PHE Department, represented by Senior Additional Advocate General (Sr AAG) A. R Malik, filed a writ petition challenging the award.

Justice Nargal, while considering the arguments, noted that the petitioners had established a prima facie case for relief.

As a result, the court stayed the execution of the award, which had been issued by the District Level Micro & Small Enterprises Facilitation Council (MSEFC), SAS Nagar, Punjab.

The disputed arbitral award, passed on June 1, 2023, directed the PHE Department to pay Rs 2.75 crore as the principal amount, along with Rs 8.77 crore in interest, under the provisions of the Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED Act).

However, Sr AAG Malik challenged the award, arguing that the MSEFC had failed to ascertain whether the respondent, M/S JTL Infra Limited, complied with the statutory requirements outlined in Sections 7 and 8 of the MSMED Act.

He contended that the respondent’s turnover and investment exceeded the thresholds set for MSMEs, thus invalidating the council's jurisdiction over the case.

Malik also highlighted that the council had proceeded ex-parte, neglecting the petitioner’s objections and written submissions, which violated principles of natural justice.

Additionally, he argued that the council failed to verify whether the respondent was properly registered under the MSMED Act, a key requirement for claiming benefits under the law.

Justice Nargal, after reviewing these submissions, concluded that there was a prima facie case for granting the interim stay.

The court issued notice to the other side and scheduled the next hearing for February 17, 2025, for further proceedings in the matter.

(KNN Bureau)