Date:June 1, 2022
Where can an MSME claim be filed? Territorial Jurisdiction of Facilitation council.
Law points by NB Associates
Section 18(4) of the Micro, Small and Medium Enterprises Development Act, 2006 (the ‘Act’) provides that :
(4) Notwithstanding anything contained in any other law for the time being in force, the Micro and Small Enterprises Facilitation Council or the centre providing alternate dispute resolution services shall have jurisdiction to act as an Arbitrator or Conciliator under this section in a dispute between the supplier located within its jurisdiction and a buyer located anywhere in India.
The territorial jurisdiction of the Micro and Small Enterprises Facilitation Council (MSEFC) is limited to the state or union territory where the supplier (MSME) is located.
For example, if an MSME located in Delhi has a dispute with a buyer located in some other state over delayed payment, the MSME can file a claim with the MSEFC in Delhi.
It is important to note that the MSEFC is established under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, and its jurisdiction is limited to resolving disputes related to delayed payments to MSMEs. For other types of disputes or claims, MSMEs may need to approach other forums or authorities depending on the nature of the claim and the applicable laws and regulations.
Thus, the dispute can be filed where the supplier of the goods or services is located.
Further, the conciliation or arbitration is to take place in the same place i.e. where the supplier of the goods or services is located.