Telangana High Court Vishwa Samudra Engineering Private ... vs Aeon Infratel Private Limited on 31 October, 2025 THE HON'BLE THE CHIEF JUSTICE SRI APARESH KUMAR SINGH ARBITRATION APPLICATION No.55 of 2025 ORDER: Heard Mr. Rajeev Rambhatla, learned counsel representing Ms. Sirnapelly Pooja, learned counsel for the applicant and Mr. K.Keertivardhan Reddy, learned counsel for the respondent. 2. The main issue in the present application is not on the existence of the agreement between the parties or the existence of the dispute between the parties, but the forum before which the dispute can be adjudicated. Applicant is the first party under a SubContractor Agreement dated 04.06.2022, which contains an arbitration clause 49, which is also not disputed by the respondent. The issue, as observed hereinabove, is whether the Micro & Small Enterprises Facilitation Council, Jammu (hereinafter referred to as 'MSEFC') would be the proper forum or an independent arbitrator appointed by this Court would be the forum where the dispute between the parties is to be adjudicated. Respondent admittedly is a Micro, Small and Medium Enterprise (hereinafter referred to as "MSME") registered with the MSEFC, Jammu, on 27.04.2020 under the erstwhile "MSME UDYOG AADHAAR" system, whose registration was further renewed with effect from 15.07.2022 under the new 2 "MSME UDYAM" process. The SubContractor Agreement was entered between the parties on 04.06.2022. In respect of the disputes between the parties, the respondent approached the learned Court of Munsiff, Samba, for perpetual injunction in which the applicant appeared and filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act of 1996"). By order dated 18.09.2024, the learned Court of Munsiff, Samba, accepted the objection of the applicant and disposed of the matter, as the agreement between the parties provided for arbitration clause. Thereafter, the respondent initiated proceedings under the Micro, Small and Medium Enterprises Development Act, 2006 (hereinafter referred to as 'the MSMED Act') before the MSEFC on 01.02.2025. On 15.02.2025, the respondent submitted hard copies of documents relating to the claims in response to the MSEFC's requisition. The present applicant issued notice invoking arbitration clause through Registered Post on 17.02.2025, which returned due to "insufficient address". Thereafter, on 25.02.2025, the applicant sent an email notice to the respondent invoking arbitration clause. On 04.03.2025, the MSEFC issued notice to the applicant. The present arbitration application was filed on 13.03.2025 by the applicant wherein 3 there was no mention of the proceedings before the MSEFC. Applicant also replied to the notice dated 04.03.2025 from the MSEFC on 17.03.2025 after filing of the arbitration application. 3. In the present arbitration application, counter affidavit was filed by the respondent on 12.06.2025. Rejoinder thereto has been filed on 20.06.2025. 4. On the part of the applicant, the following plea has been taken. That parties entered into a SubContractor Agreement on 04.06.2022 for shifting of electrical utilities (including distribution and transmission) and water pipeline utilities in relation to the project titled "Construction of four/six lane accesscontrolled expressway from Gurha Baildaran to Junction with Jammu Ring Road (NH 244A) near Jakh village (468+100 km to 503+250) of Delhi Amritsar Katra Expressway". The agreement was executed on an item rate contract basis, with the rates being based on the cost data of the Utilityowning department prevailing at the time of the agreement's execution. Despite multiple extensions by the applicant in good faith, respondent failed to complete the work within stipulated timeframe of six months from the date of agreement i.e., by 04.12.2022. The respondent continued to raise running account 4 bills from February, 2023 onwards, which were containing discrepancies. Therefore, applicant was compelled to terminate the SubContractor Agreement vide notice dated 07.05.2024. Applicant has averred that notice invoking arbitration clause was issued on 07.02.2025 and 19.02.2025. Thereafter, the applicant filed application under Section 11(5) and (6) of the Act of 1996 on 13.03.2025 before this Court. 5. Learned counsel for the applicant also avers that on 01.02.2025, the respondent had approached the MSEFC under the MSMED Act as an afterthought to delay the arbitration proceedings despite knowing fully well that this is a works contract. Though a plea was taken that the respon