Misappropriation of funds from a current account qualifies as a commercial dispute under Section 2(1)(c) of the Commercial Courts Act, 2015, allowing the Commercial Court to have jurisdiction over the case.

ORDER :

M.NAGAPRASANNA, J.

The petitioner - plaintiff is before this Court calling in question an order dated 30.08.2022 by which the concerned Court rejects the plea of the petitioner - plaintiff that the dispute is a commercial dispute within the meaning of Section 2 (1)(c) of the COMMERCIAL COURTS ACT , 2015 ('the Act for short)and therefore as to be tried by the Commercial Court.

2. Heard Shri Hemanth R. Rao, learned counsel and Shri Rukkoji Rao H.S., learned counsel appearing for the petitioner and Shri Jai M. Patil, learned counsel appearing for respondent No.1.

3. The facts in brief germane are as follows:

The plaintiff is a partnership firm in the business of garment processing and manufacturing. The defendant No.1 is a banking company and other defendants are employees of the banking company. The plaintiff had appointed defendant No.3 as its Accountant with effect from 01.07.2017 and the other defendants are associates of defendant No.3. A current account is maintained at the branch of defendant No.1 for several years. Several irregularities in the said account were found in the month of December-2019. It transpires that huge sums of money were withdrawn in cash through cheques by defendant No.3 from the current account by allegedly forging the signatures of the partners of the plaintiff firms. All the said cheques have been passed by defendant No.1 through defendant No.2, without due verification.

4. The plaintiff then was informed by defendant No.1 that defendant No.3 had changed the registered mobile number of the plaintiff's banking account to his personal number and thereby all the OTP would come to his mobile number. On coming to know of the said misappropriation of funds, a crime comes to be registered by the plaintiff and the police after investigation have filed a charge sheet, which is pending in C.C.No.2281/2020. The plaintiff then causes a legal notice on the defendants calling upon them to jointly and severally pay a sum of Rs.4,58,75,000/- with 18% interest per annum.

5. The notice was served and defendant No.1 replies to the notice denying the same. The plaintiff then institutes an O.S.No.117/2021 before the V Additional Senior Civil Judge, Bengaluru Rural District. On constitution of the Commercial Court, the plaintiff is said to have filed an application under Section 15 of the Act seeking transfer of the suit to the Commercial Court, as according to the plaintiff the dispute was a commercial dispute in terms of the Act. The Court taking up the application, rejects it on the ground that it is not a commercial dispute. None of the defendants objected to the application, but consented to the matter to be transferred to the Commercial Court. The suit was transferred on 16.04.2022 and registered as Commercial O.S.No.95/2022. The Commercial Court then framed an issue as to whether the Commercial OS was maintainable, as a preliminary issue.

Answering the preliminary issue, the Commercial Court holds that the suit, before the Commercial Court is not maintainable.

It is therefore, the petitioner - plaintiff is before this Court.

5. Learned counsel appearing for the petitioner would reiterate the submissions made before the concerned Court to contend that the definition is clear, that it is a commercial dispute. If it were to be misappropriation in a savings bank account, it would not have become a commercial dispute, but what has happened is in a current account, as day to day business happens in that account. Therefore, it becomes a commercial dispute. He would seek to place reliance upon plethora of judgments, all of which would bear consideration qua the relevance, in the course of the order.