In Brief
The Supreme Court upheld that the Micro, Small and Medium Enterprises (Development) Act, 2006 overrides the Arbitration and Conciliation Act, 1996. When an MSME registered in Delhi invokes the Facilitation Council under Section 18 of the MSMED Act, the Council where the supplier is located has jurisdiction to conduct arbitration, regardless of contractual clauses specifying a different seat. The Court set aside the Karnataka High Court's order that had declared the Delhi Arbitration Centre lacked jurisdiction, and directed the arbitral proceedings to continue, emphasizing that statutory protections for MSMEs cannot be overridden by private agreements.
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