HAMILTON MEDICAL Vs. MICRO SMALL MEDIUM ENTERPRISES

JUDGEMENT

(1.) This writ petition is filed by M/s. Hamilton Medical AG, seeking to set aside the Intimation-cum-Notice, dated 22.10.2020 (received through mail), the Notice, dated 04.11.2020 (received through mail, dated 18.11.2020); and Notice, dated 12.11.2020 (received through email, dated 23.11.2020) having reference No. 1581/MSEFC/2020 issued by the respondent No. 1 with reference to the application being UDYAM-TS-02-0002716/M/00001 filed by the respondent No. 1 and to stay all consequential proceedings emanating therefrom.

(2.) The petitioner is a Company registered under the laws of Switzerland, having its office at Bonaduz, Switzerland and is a manufacturer and supplier of critical care ventilation solutions for a variety of patient segments, applications and environments across the world. The petitioner-Company does not have any factory within India and therefore, is in the process of setting up a domestic private limited company. The Company has its own consultants, engaged in India, who facilitate the installation of the equipment of the petitioners and undertake related ancillary work. It also supplies the equipment to its distributors who supply to the customers in the private and Government sectors. In August-September, 2018, M/s. Vaishno Enterprises, respondent No. 2 herein, a partnership firm, which provides consultancy services, approached the petitioner-Company and requested to be associated with the Company in implementation of their projects in India. While so, HLL Infra Tech Services Limited, a Nodal Agency of Government of India, had floated a tender, dated 20.08.2018 to purchase/procure 1186 high end ventilators and other medical equipment to be supplied to various hospitals/medical colleges/ departments across India. The petitioner has participated in the said tender by offering its bid through its authorized local agent, M/s. Medelec Health Care Solutions ('Medelec Solutions'). Eventually, the tender was awarded in favour of Medelec Solutions. Upon sudden resignation of Senior Consultants of petitioner-Company, the respondent No. 2 contacted the petitioner-Company through email and offered their services. After negotiations, the petitioner and the respondent No. 2 entered into a Consulting Agreement on 10.02.2020, with a restricted term of six months, agreeing that the respondent No. 2 would act as a consultant for the petitioner-Company and handle such issues as per the terms and conditions of the agreement, dated 10.02.2020. Immediately thereafter, the respondent No.2 had raised various invoices, dated 11.02.2020, 11.04.2020 and 15.05.2020 claiming certain amounts. Even though the respondent No. 2 is not eligible to claim those amounts, the petitioner-Company, in good faith, paid the excessive amount as raised in Invoice Nos. 1 and 4 on 05.05.2020 and 17.06.2020 respectively, as supply was being maintained and LCs were being opened in a rush due to pandemic crisis. Again, the respondent No. 2 raised Invoice No. 5 on 22.06.2020 for an amount of USD 7,11,845.00. As there was no basis for raising of invoices, the petitioner through email dated 24.08.2020 informed the respondent No. 2 that the invoices will be cleared in due course and asked the firm to perform its obligations and to supply the equipments to meet the huge demand. The Consulting Agreement dated 10.02.2020 expired on 10.08.2020. However, as the petitioner-Company is in need of services of respondent No. 2 to meet the demand, a fresh Consulting Agreement was entered with the respondent No. 2 on 24.08.2020 for a period of six months. Subsequently, as there was no help and assistance for the transportation, installations, demonstration of ventilators from the respondent No. 2, the petitioner-Company had to involve other companies to ensure smooth supply of equipments. The respondent No. 2, thereafter, started to threaten the petitioner-Company in order to extort money and started to send warning emails to various members of the Board and the Company of the petitioner, such as email dated 24.08.2020. Further, a legal notice, dated 09.09.2020 was sent by the respondent No. 2 calling upon the petitioner-Company to pay the amounts covered by Invoice Nos. 5 and 6 within 30 days along with damages of Rs.50.00 lakh. In the said notice, the respondent No. 2 informed that it had registered itself under the Micro, Small and Medium Enterprises Act, 2006 (for short, 'MSME Act'). Immediately, the petitioner-Company terminated the Consulting Agreement, dated 24.08.2020 vide termination letter, dated 02.10.2020.

(3.) While so, the Chairman of Micro, Small, Medium Enterprises Facilitation Council, Ranga Reddy, the respondent No. 1 herein issued the impugned Intimation-cum-Notice, dated 22.10.2020, whereby the petitioner was advised to pay an amount of Rs.8,18,20,882/- to the respondent No. 2 being the dues of unpaid Invoice Nos. 5, 6 and proforma Invoice, dated 21.10.2020 within fifteen days. The petitioner-Company sent a reply, dated 26.10.2020 informing the respondent No. 1 that no amount is payable to the respondent No. 2 and that the petitioner-Company is not situated within India and therefore, the provisions of MSME Act will not be applicable to the Company. Thereafter, the petitioner-Company received an email, dated 18.11.2020 from the official mail ID of respondent No. 1, containing therein a covering letter of respondent No. 2, the Statement of Claim, dated 02.11.2020 along with attested affidavit being Reference No. 1581/MSEFC/2020 and impugned notice, dated 04.11.2020 issued thereon by the respondent No. 1 calling upon the petitioner-Company to furnish their Statement of Defense to the Statement of Claim filed by the respondent No. 2 within 30 days. In the same mail, dated 18.11.2020, the petitioner had also received a copy of the Supplementary Pleadings, dated 16.11.2020, to the Statement of Claim.