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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.I.CHAGLA
Gundecha Estates Pvt. Ltd. – Appellant
Versus
IIFL Finance Ltd. – Respondent
R.I. CHAGLA J.
1. By the Interim Applications, the Applicant / Defendant No.1 and Applicant / Defendant No.8 are seeking rejection of the Plaint under Order VII Rule 11 of the Code of Civil Procedure, 1908 for non-compliance of the requirement of pre-institution mediation under Section 12A of the COMMERCIAL COURTS ACT , 2015 (“the 2015 Act”).
2. The Commercial Suit has been filed by the Plaintiff inter alia seeking a declaration that the Indenture of Mortgage dated 31st March, 2022 and the Assignment Agreement dated 29th June, 2024 are null and void ab initio.
3. The Applicants by the present Interim Applications have` submitted that there is no urgency in the matter warranting exemption from non-compliance with Section 12A of the 2015 Act. In view thereof the Suit is liable to be dismissed. Certain relevant facts are necessary to be referred to and are as under:-
(i) On 1st February, 2006, the Development Agreement was executed whereunder the Defendant No.2 granted the Plaintiff development rights in respect of portion of land admeasuring 18,007.56 sq. mts. Situated at D.N. Nagar, Taluka Andheri (Land) i.e. Sub Plot ‘C’, admeasuring 8088.81 Sq. mts. (“Suit property”). It is p
Pre-institution mediation is mandatory before filing a commercial suit, and failure to demonstrate urgency can lead to rejection of the plaint under Order VII Rule 11.
Pre-institution mediation under Section 12A of the Commercial Courts Act is mandatory unless genuine urgency is shown; plaintiff must substantiate claims of urgency.
The mandatory nature of pre-institution mediation under Section 12A of the Commercial Courts Act requires genuine urgency to bypass mediation.
Section 12A of the Commercial Courts Act mandates exhaustion of pre-institution mediation unless a suit clearly contemplates urgent interim relief, a point upheld by the court in dismissing the petit....
Maintainability of commercial suit – Suit which does not contemplate any urgent interim reliefs cannot be instituted unless plaintiff exhausts mandatory remedy provided under Section 12A of Commercia....
Rejection of plaint – Simply because plaintiffs did not succeed in obtaining interim relief, same cannot be a ground for rejection of plaint – Even a weak case for urgent relief cannot be thrown out.
Section 12A of the Commercial Courts Act requires pre-institution mediation for suits not seeking urgent relief, establishing a mandatory procedural framework.
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