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2022 (4) TMI 981 - SC - Indian LawsProceeding under section 34 of the Arbitration Act, 1996 without insistence for making pre-deposit of 75% of the awarded amount - whether the pre-deposit of 75% of the awarded amount as per section 19 of the MSMED Act, 2006, while challenge to the award under section 34 of the Arbitration Act, 1996, is made mandatory or not? - HELD THAT:-The issue is now no longer res integra in view of the decision of this Court in the case of Gujarat State Disaster Management Authority Vs. Aska Equipments Limited [2021 (10) TMI 480 - SUPREME COURT]. While interpreting section 19 of the MSMED Act, 2006 and after taking into consideration the earlier decision of this Court in the case of GOODYEAR INDIA LIMITED VERSUS NORTON INTECH RUBBERS (P) LTD. AND ANR. [2012 (3) TMI 611 - SUPREME COURT], it is observed and held that the requirement of deposit of 75% of the amount in terms of the award as a predeposit as per section 19 of the MSMED Act, is mandatory. It is also observed that however, at the same time, considering the hardship which may be projected before the appellate court and if the appellate court is satisfied that there shall be undue hardship caused to the appellant/applicant to deposit 75% of the awarded amount as a pre-deposit at a time, the court may allow the pre-deposit to be made in instalments. Therefore, it is specifically observed and held that pre5 deposit of 75% of the awarded amount under section 19 of the MSMED Act, 2006 is a mandatory requirement. The impugned order passed by the High Court permitting the proceedings under section 34 of the Arbitration Act, 1996 without insistence for making pre-deposit of 75% of the awarded amount is unsustainable and the same deserves to be quashed and set aside - Appeal allowed - decided in favor of appellant.
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