LexNBCC (INDIA) LTD. versus THE STATE OF WEST BENGAL & ORS
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
[2025] 1 S.C.R. 610 : 2025 INSC 54 NBCC (India) Ltd. v. The State of West Bengal & Ors. (Civil Appeal No. 3705 of 2024) 10 January 2025 [Pamidighantam Sri Narasimha* and Pankaj Mithal, JJ.] Issue for Consideration Whether an MSME cannot make a reference to the Facilitation Council for dispute resolution under Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 if it is not registered under Section 8 of the 2006 Act before the execution of the contract with the buyer. Headnotes† Micro, Small and Medium Enterprises Development Act, 2006 – s.18 – MSME seeks to refer the dispute that it has with the buyer regarding payment of its dues to the Facilitation Council for arbitration u/s. 18 of the Act – The appellant opposes this prayer by contending that ‘any party’ can only be a ‘supplier’ and that supplier should have been registered u/s. 8 of the Act even before execution of the contract, if not, the reference is impermissible: Held: After examining the text, context, and purpose of the Act, this Court arrives at the decision that s.18 is not restrictive and is a remedy for the resolution of disputes, and as such, it is kept open-ended to enable ‘any party’ to refer the dispute to seek redressal – The submission that ‘any party to a dispute’ is confined to a ‘supplier’ who has filed a memorandum u/s. 8 of the Act is rejected – The issue(s) that have arisen in the decisions of this Court in Silpi Industries v. Kerala State Road Transport Corporation and Gujarat State Civil Supplies Corporation Limited v. Mahakali Foods Private Limited were very different from the issue that has arisen for consideration in the instant case – Though it is possible for this Court to follow the precedents to arrive at the * Author [2025] 1 S.C.R. 611 NBCC (India) Ltd. v. The State of West Bengal & Ors. conclusion that the judgments in the case of Silpi Industries and Mahakali Foods coupled with the subsequent orders in Vaishno Enterprises and M/s Nitesh Estates cannot be considered to be binding precedents on the issue that has arisen for consideration, taking into account the compelling need to ensure clarity and certainty about the applicable precedents on the subject, it is deemed appropriate to refer this appeal to a three Judge Bench. [Paras 1.1, 29] Interpretation of Statutes – Interpretation of Statutory Remedies by Constitutional Courts: Held: When a statutory remedy falls for consideration, it is the duty of the Constitutional Court to adopt an interpretation which would not only reduce the hiatus between a right and a remedy, but also to ensure that the remedy is effective – If rights are recognition of a claim, remedies are their actualization – While the rights regime receives broad recognition under constitutional framework, it is imperative that remedies must keep pace and be strengthened – One of the core functions of the higher judiciary is to bridge the gap between rights and remedies, and this would immediately give rise to the legislative, executive and judicial obligations for their provision, implementation, and declaration, respectively. [Para 10] Justice – Access to justice – Right to an effective judicial remedy: Held: The right to an effective judicial remedy is an integral part of access to justice – An effective judicial remedy under a constitutional scheme must be (i) accessible, (ii) affordable, (iii) expeditious and (iv) cohesive – Accessibility requires the remedy to be easily available, physically and informationally – Affordability is an aspect that is related to the cost of availing the remedy, it must be at a reasonable price with a provision for legal aid, if need be – The expeditious nature of a remedy is concerned with the quick disposal of the case and abhors unreasonable delays – Yet another facet of effective judicial remedy is its cohesiveness – The cohesiveness of a remedy simply means that a person must have one specified forum for the redressal of grievances. [Para 10.1] 612 [2025] 1 S.C.R. Digital Supreme Court Reports Micro, Small and Medium Enterprises Development Act, 2006 – s.18 – Words employed “any party to a dispute” – Golden Rule of Interpretation: Held: The text of Section 18 is clear and categoric – The words employed herein are “any party to a dispute” – The age-old principle, referred to as the Golden Rule of Interpretation, is that “words of a statute have to be read and understood in their natu
Excerpt shown. Read the full judgment & AI analysis in Lexace.