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2016 Supreme(Bom) 1409
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ANOOP V. MOHTA & G.S. KULKARNI, JJ.
Hubtown Limited – Appellant
Versus
IDBI Trusteeship Service Limited – Respondent
Commercial Appeal No. 7 of 2016 In Summons for Judgment No. 111 of 2014 In Summary Suit No. 776 of 2014 with Notice of Motion (Lodging) No. 2028 of 2016 In Commercial Appeal No. 7 of 2016
Decided On : 24-10-2016
For the Appellant :Mr. Janak Dwarkadas, Senior Advocate, Mr. Simil Purohit, Mr. Aditya Thakkar, Mr. Nishit Dhruva, Mr. Prakash Shinde, Mr. Chirag Bhavsar, MDP & Partners.
For the Respondent:Mr. F.E. Devitre, Senior Advocate, Mr. Kunal Dwarkadas, Mr. Verghese Thomas, Ms. Aditi V. Deshpande, Mr. Yohana Lumathawalla, J. Sagar Associates.
The Commercial Court Appeal against the decision/judgment/order/decree is maintainable once the suits, petitions, applications, and appeals are transferred and treated as commercial disputes where the learned Commercial Division Judge has taken the decision and/or passed the “judgment” and/or “order” or “decree”.
Headnote:
The Commercial Court Appeal against the decision/judgment/order/decree is maintainable once the suits, petitions, applications, and appeals are transferred and treated as commercial disputes where the learned Commercial Division Judge has taken the decision and/or passed the “judgment” and/or “order” or “decree”.
Fact of the Case:
The Respondent (Plaintiff) (IDBI) filed a Summary Suit No. 776 of 2014 on 11 September 2014, seeking a decree in the sum of over Rs.33 crores. During the pendency of the Summary Suit, the Commercial Courts, Commercial Division, Commercial Appellate Division of High Courts Ordinance, 2015 (the Ordinance) was promulgated on 23 October 2015 with immediate effect. The Ordinance inter-alia provided for the constitution of Commercial Divisions in High Courts having ordinary original civil jurisdiction. An order/notice dated 17 November, 2015 was issued by the then Hon'ble the Acting Chief Justice constituting the Commercial Division and Commercial Appellate Division under Sections 4 and 5 of the Ordinance. The then Hon'ble Acting Chief Justice also issued an Assignment Order dated 22 December, 2015 of the Original Side of this Court to take effect from 4 January 2016, constituting the Commercial Division and the Commercial Appellate Division of this High Court and nominating Judges for the same. Mr. Justice S.C. Gupte was nominated as the “Commercial Division” of this Court and assigned all summary suits, including the present summary suit. Assignment Order dated 22 December 2015, was the order constituting the Commercial Division and Commercial Appellate Division. The Commercial Courts Act does not prescribe any particular form of the order to constitute such Divisions. The Chief Justice is required to pass only an administrative order, not a judicial order. On 1 January, 2016, the Commercial Courts Act came to be notified in the Official Gazette with effect from 23 October 2015. On 4 January 2016, the Commercial Divisions and the Commercial Appellate Divisions as constituted, have commenced functioning accordingly. On 7 January 2016, and from time to time thereafter, the Assignment Orders were varied as under:- (a) Notice dated 7 January 2016 in partial modification of the Assignment order dated 22 December 2015. (b) Assignment order dated 3 March 2016 with effect from 7 March 2016. (c) Assignment order dated 15 March 2016 with effect from 21 March 2016. (d) Assignment order dated 19 August 2016 with effect from 22 August 2016. At all relevant times, the learned Judge continued to be nominated as the “Commercial Division” of this Court assigned to hear all summary suits, including the present summary suit.
Finding of the Court:
The impugned Judgment and order dated 6 June 2016 passed by the learned Single Judge of the Commercial Division in Summons for Judgment No. 111 of 2011, is quashed and set aside, as the Defendant has raised the triable issues, which required adjudication on further evidence at the time of final disposal of the Suit; Unconditional leave is granted to the Defendant to defend the above suit; The Suit is transferred to the list of commercial causes and the Defendant is directed to file its written statement on or before 28 November 2016; The hearing of the Suit is expedited. The learned Judge will endeavour to dispose of the Suit within a period of one year from the date of this order. Place the Suit for framing of issues on 9 January 2017.
Issues: Whether the Commercial Court Appeal against the decision/judgment/order/decree is maintainable once the suits, petitions, applications, and appeals are transferred and treated as commercial disputes where the learned Commercial Division Judge has taken the decision and/or passed the “judgment” and/or “order” or “decree”.
Ratio Decidendi: The Commercial Court Appeal against the decision/judgment/order/decree is maintainable once the suits, petitions, applications, and appeals are transferred and treated as commercial disputes where the learned Commercial Division Judge has taken the decision and/or passed the “judgment” and/or “order” or “decree”. It is relevant to note that Law Commission of India in its 253 Report has recommended the establishment of Commercial Courts, the Commercial Division and the Commercial Appellate Division in the High Courts for disposal of commercial disputes of specified value. On 23 December 2015, the Commercial Courts Act, having retrospective effect from 23 October 2015 by repealing the ordinance with the following rider has been promulgated.
Final Decision: Appeal is accordingly disposed of.
ANOOP V. MOHTA, J.
1. This Commercial Appeal is filed by the Appellant-Original Defendant against the Judgment and order dated 6 June 2016, passed by the learned Single Judge of the Commercial Division in Summons for Judgment whereby, refused an unconditional leave to defend and has granted a leave to defend, but conditional.
Preliminary objection to the maintainability of Commercial Appeal.
2. To decide the preliminary objection of the maintainability of Commercial Appeal as filed, as raised by the learned Senior Counsel appearing for the Respondents, though the parties have consented to hear the Appeal on merits, we have relisted the matter for hearing on the maintainability as it goes to the root of the matter in view of the confusion prevailing in the Office/Registry after the transfer of such pending summary suits because of the provisions of The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (for short “The Commercial Courts Act”).
Background of proceedings-
3. The following are the background dates of the proceedings as per the Respondent- Plaintiff (IDBI) to decide the maintainability of the Commercial Appeal under Section 13 of the Commercial Courts Act, apart from decision on merits.
On 11/09/14, Summary Suit No. 776 of 2014 was filed by the Respondent (Plaintiff) (IDBI) on 11 September 2014, seeking a decree in the sum of over Rs.33 crores.
During the pendency of the Summary Suit, the Commercial Courts, Commercial Division, Commercial Appellate Division of High Courts Ordinance, 2015 (the Ordinance) was promulgated on 23 October 2015 with immediate effect. The Ordinance inter-alia provided for the constitution of Commercial Divisions in High Courts having ordinary original civil jurisdiction.
An order/notice dated 17 November, 2015 was issued by the then Hon'ble the Acting Chief Justice constituting the Commercial Division and Commercial Appellate Division under Sections 4 and 5 of the Ordinance.
The then Hon'ble Acting Chief Justice also issued an Assignment Order dated 22 December, 2015 of the Original Side of this Court to take effect from 4 January 2016, constituting the Commercial Division and the Commercial Appellate Division of this High Court and nominating Judges for the same. Mr. Justice S.C. Gupte was nominated as the “Commercial Division” of this Court and assigned all summary suits, i.e. including the present Summary Suit. Assignment Order dated 22 December 2015, was the order constituting the Commercial Division and Commercial Appellate Division. The Commercial Courts Act does not prescribe any particular form of the order to constitute such Divisions. The Chief Justice is required to pass only an administrative order, not a judicial order.
On 1 January, 2016, the Commercial Courts Act came to be notified in the Official Gazette with effect from 23 October 2015.
On 4 January 2016, the Commercial Divisions and the Commercial Appellate Divisions as constituted, have commenced functioning accordingly. On 7 January 2016, and from time to time thereafter, the Assignment Orders were varied as under:-
(a) Notice dated 7 January 2016 in partial modification of the Assignment order dated 22 December 2015.
(b) Assignment order dated 3 March 2016 with effect from 7 March 2016.
(c) Assignment order dated 15 March 2016 with effect from 21 March 2016.
(d) Assignment order dated 19 August 2016 with effect from 22 August 2016.
At all relevant times, the learned Judge continued to be nominated as the “Commercial Division” of this Court assigned to hear all summary suits, including the present summary suit.
4. The Summons for Judgment in the Summary Suit was argued finally on merits by the counsel for the parties before the Commercial Division on 12 and 14 January 2016 and was reserved for orders on 14 January 2016.
On 13 May 2016, pending the final order in the Summons for Judgment, the captioned Summary Suit was formally transferred by a notice issued by the High Court (along
