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M/S Indo Engineering Works v. Rashtriya Ispat Nigam Limited (RINL)

Civil Appeal · 2026 INSC 874Decided 13 Aug 2026
Civil Appeal No. 10750 of 2026 (arising out of SLP (C) No. 24388 of 2026)
Justice J.B. Pardiwala · Justice K. Vinod Chandran

Background

Indo Engineering Works, a small-scale industry, approached the Andhra Pradesh Micro and Small Enterprises Facilitation Council for arbitration of a dispute arising from a works contract with Rashtriya Ispat Nigam Limited (RINL). RINL succeeded before a Single Judge of the High Court, who held that Indo Engineering had never filed the statutory memorandum required under Section 8 of the MSMED Act, 2006 to invoke the Council's jurisdiction. On appeal, a Division Bench kept the matter pending because a related legal question was already referred to a larger three-judge bench of the Supreme Court.

Decision Breakdown

Since a reference on the same legal point was already pending before a larger bench, the Supreme Court declined to rule on the Section 8 question itself. Instead, with the appellant's consent, it steered the dispute into ordinary (non-statutory) arbitration rather than waiting indefinitely for the larger bench's ruling. The Court clarified that if arbitration proceeds in this normal mode, the appellant cannot simultaneously claim the special benefits available under the MSMED Act, 2006. It then appointed a former Andhra Pradesh High Court judge as the sole arbitrator to decide the dispute on its merits, expressing no opinion on those merits itself.

Lesson Learnt

A small business does not have to wait indefinitely for unsettled legal questions to be resolved by a larger bench. It can consent to ordinary arbitration to get a faster resolution, but doing so means giving up the special protections that the MSME Act's Facilitation Council route would otherwise offer.

Official source (sci.gov.in)View Judgment (PDF)

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