In Brief
A micro-enterprise approached the Rajasthan Facilitation Council claiming unpaid bills. The Council issued a summons but, upon the appellant's non-appearance, passed an order on the same day directing payment without conducting formal arbitration proceedings. The Supreme Court held that the order was void and not a valid arbitral award. When conciliation fails under the MSMED Act, 2006, the Council must follow mandatory procedural provisions of the Arbitration and Conciliation Act, 1996—including proper hearings and opportunity to be heard—before passing an award. Conciliation and arbitration are distinct processes and cannot be conflated. The Court allowed the appeal, quashed the order, and remitted the matter for proper arbitration proceedings.
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