Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Small scale Industries |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Act(s) Referred | Arbitration and Conciliation Act, 1996 (26 of 1996) Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 (32 of 1993) |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 – s.2(b), (c), (f); proviso to s.3; s.4 – “buyer”; “supplier” – Liability of buyer to make payment – Date from which and rate at which interest is payable: Held: On a reading of s.3 of the 1993 Act, as it stood before the enactment of the proviso, the buyer and the supplier could agree upon the date of payment – In case of absence of stipulation with regard to the date of payment, the “appointed day” in terms of s.2(b) of the 1993 Act, would be the date, on which the payment is due – This is also clear from reading s.4, which states the date from which interest is payable – As per s.4, the buyer is liable to pay interest if he fails to pay the amount to the supplier as required by s.3 – After enactment of the proviso to s.3, the contractual rights of the parties to agree to the date of payment, have been restricted in terms of the said proviso – Thus, if the contractual date of payment exceeds 120 days from the day of acceptance or the day of deemed acceptance, interest would be payable for the period beyond 120 days from the day of acceptance or the date of deemed acceptance – In the present case, the supply/purchase order dated 30.03.1995 issued by MSSIDCL to SSPL, postulated and the parties had agreed that MSSIDCL would be liable to pay SSPL only after the goods were delivered and accepted by the consignee-Maharashtra State Electricity Board (MSEB) and on the payment being received by MSSIDCL from the MSEB – No reason to interfere with the conclusion in the impugned judgment passed by the High Court, setting aside the arbitral award – Further, by way of Act No.23 of 1998, which came in effect from 10.08.1998, amending clause 2(f), MSSIDCL is to be treated or deemed to be a supplier to MSEB – However, this will not deviate from the fact that MSSIDCL was the buyer under the supply/purchase order dated 30.03.1995 issued by MSSIDCL to SSPL – Equally, the G.O. 2(1)/A/93- SSI Bd. and Policy dated 05.05.1993 issued by the Ministry of Industry, Department of SSI, Agro and Rural Industries, Office of the Development Commissioner (Small Scale Industries), had an effect of treating MSSIDCL as a supplier for the purpose of claiming interest from the buyer, that is MSEB, with whom they have entered into a contract for the purpose of the 1993 Act – The liability to pay and the privity of contract in terms of the supply/purchase order dated 30.03.1995 is between MSSIDCL and SSPL – The contractual relationship, rights and obligations inter se MSSIDCL and SSPL do not undergo any change. [Paras 6, 8-10, 13, 14] |
Judge | Hon'ble Mr. Justice Dipankar Datta Hon'ble Mr. Justice Sanjiv Khanna |
Neutral Citation | 2024 INSC 201 |
Petitioner | Snehadeep Structures Pvt. Limited |
Respondent | Maharashtra Small Scale Industries Development Corporation Ltd. |
SCR | [2024] 3 S.C.R. 454 |
Judgement Date | 2024-03-05 |
Case Number | 3856 |
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