Madras High Court Fines TN Salt Corporation ₹1.5 Lakh for Evading MSME Arbitration

The Madras High Court imposed ₹1.5 lakh costs on Tamil Nadu Salt Corporation Limited for evading arbitration under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006.

Justice N. Anand Venkatesh observed that the corporation neither appeared before the Facilitation Council nor the sole arbitrator and later challenged the award on procedural grounds.

Dismissing the plea, the Court held that Section 18(3) of the MSMED Act prevails over contractual arbitration clauses and that objections regarding a non-speaking award and tribunal composition were meritless.

The Court upheld the arbitral award as legally sound and directed the corporation to pay the imposed costs.

[Tamil Nadu Salt Corporation v Aero Plast Limited]