In Brief
The Supreme Court upheld that the Limitation Act, 1963 applies to arbitration proceedings under the Micro, Small and Medium Enterprises Development Act, 2006. The Court clarified that counter-claims are maintainable before the MSMED Facilitation Council, treating such proceedings as arbitrations where Section 23(2A) of the Arbitration and Conciliation Act, 1996 applies. The MSMED Act, being special beneficial legislation, overrides the general Arbitration Act. However, enterprises registering under MSMED after supplying goods or services cannot claim retrospective benefits—registration operates prospectively only. The Court dismissed appeals challenging these principles, with no order as to costs.
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