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Pendency has caused MSMEs to shut down, ultimately effecting economic growth: Justice SK Kaul

The judge went on to observe that what hindered the flourishing of MSMEs was an inefficient dispute resolution mechanism. He emphasised that working on a judicial solution was as important as working on a legislative solution.

It is important to ensure that the judicial machinery provides a nurturing environment for MSME growth. History is rife with examples that despite legislations and schemes, conflicts and disputes are bound to arise with different stakeholders.”

Another impediment to dispute resolution, Justice Kaul said, was the ever-growing backlog which had resulted in several MSMEs shutting down.

MSMEs are smaller companies with lesser capital, shorter production time and fewer means to drag disputes in court for years. This has led to several MSMEs shutting down, ultimately effecting economic growth.”

The judge pondered a solution, wondering if India could adopt special courts for MSME matters or constitute special tribunals with expert members, on an ad hoc basis.

However, he concluded that the solution ought to come from the stakeholders in the MSME sector themselves.

Source: Barandbench

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