Delhi HC: Withdrawal of MSMED Council application does not preclude arbitration under Section 11, even without Council's response

The Delhi High Court in the case M/S Smartschool Education Private Limited Vs M/S Bada Business Pvt. Ltd And Ors observed and has held that the withdrawal of an application before the MSMED Council does not bar a party from seeking the appointment of an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996, even in the absence of any corresponding response from the MSMED Council.

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The Delhi High Court bench of Justice Subramonium Prasad was hearing the present matter.

FACTS OF THE CASE

The Respondent No. 2 and Respondent No. 3 approached the Petitioner i.e., Smartschool Education Private Limited to lease the software.

An agreement was entered into between the Petitioner and Respondent No. 1. The Petitioner decided to lease the software under this agreement and after the Petitioner spent a substantial amount on developing the software, the Respondents failed to fulfill the obligations of them as stated under the agreement.