Provisions Of The MSMED Act Overrides The Arbitration Agreement Between The Parties: Madras High Court

[14 April 2022] The High Court of Madras has observed that S. 18 of the MSMED Act will override the arbitration clause between the parties. The Court observed that since S. 24 of the MSMED Act is a non-obstante clause, it gives an overriding effect to the provisions of S. 15 -23 of the Act.
The Bench of Justice Pushpa Sathyanarayan and Justice P. Velmurgan observed that once a reference is filed before the MSME Council under S. 18 of the Act, the provisions of the arbitration clause must yield to the provisions contained under S. 18 of the Act.