Bombay High Court: Contractual Arbitral Seat Clause Irrelevant in MSME Arbitration

The Bombay High Court has held that an arbitral seat clause in a commercial contract cannot override the provisions of the Micro, Small and Medium Enterprises (MSME) Act, 2006.

Justice Somasekhar Sundaresan made the observation while refusing to entertain petitions filed by GEA Westfalia Separator India Pvt Ltd against arbitral awards passed by the Pune Facilitation Council in favour of SVS Aqua Technologies LLP.

The court emphasised that the MSME Act’s provisions override contractual terms to ensure speedy and equitable dispute resolution for MSMEs.

The court emphasised that larger entities cannot use contractual clauses to bypass statutory safeguards granted to MSMEs.

[GEA Westfalia Separator India Pvt Ltd v Aqua Technologies LLP]