IN THE HIGH COURT AT CALCUTTA
KRISHNA RAO, J.
Samar and Samar Infrastructure Development Private Limited – Plaintiff
Versus
Mackintosh Burn Limited and Another – Defendants
IA No. GA 4 of 2022, CS No. 72 of 2022
Decided On : 27-02-2023
Commercial Courts Act, 2015 - Section 12A - Code of Civil Procedure, 1908 Section 80 (2) - Contract Act - Section 70 - Arbitration and Conciliation Act, 1996 - section (4) of Section 30 - Insertion of new rules to the Code applicable to suits of commercial disputes - Pre-institution Mediation and Settlement - Plaintiff has filed the instant suit before Commercial Division on ground that suit filed by plaintiff relates to commercial dispute within meaning of Commercial Courts Act, 2015 – Held, Court declared that Section 12A of Commercial Courts Act, 2015 is mandatory and held that any suit instituted violating the mandate of Section 12A must be visited with rejection of plaint under Order 7 Rule 11 of CPC - Court is of the view that plaintiff has filed the suit and on same day this Court granted leave to plaintiff under Section 12A of Commercial Courts Act, 2015 - G.A. No. 4 of 2022 is thus dismissed
JUDGMENT :
KRISHNA RAO, J.
1. The defendant no. 2 has filed the instant application being GA 4 of 2022 under Order VII Rule 11 of the Code of Civil Procedure, 1908 for rejection of plaint. The defendant no. 2 says that the plaintiff has filed the instant suit without complying with the provisions as enumerated under Section 12A of the Commercial Courts Act, 2015.
2. The plaintiff has filed the instant suit before the Commercial Division on the ground that the suit filed by the plaintiff relates to commercial dispute within the meaning of Commercial Courts Act, 2015.
3. Mr. Anirban Ray assisted by Mr. Domingo Gomes, Learned Advocates representing the defendant no. 2 submits that the plaintiff has not exhausted the remedy of pre-institution mediation in accordance with the manner and the procedure as prescribed under law.
4. Mr. Ray further submits that even the plaintiff has not prayed for any urgent interim relief in the suit and thus the suit filed by the plaintiff is required to be dismissed for not following the procedure as prescribed under law.
5. Mr. Ray submits that the suit filed by the plaintiff is barred by limitation as the work order was issued on 19.01.2015 and the suit was filed in the month of March, 2022. He further submits that the plaintiff has also admitted in the plaint that there is no cause of action arose against the defendant no. 2.
6. Mr. Ray relying upon the Judgment reported in Patil Automation Private Limited and Others vs. Rakheja Engineers Private Limited, (2022) 10 SCC 1 submits that Section 12A of the Commercial Courts Act, 2015 is mandatory and the plaintiff has instituted the suit by violating the mandate of Section 12A of the Act of 2015.
7. Mr. Ray relying upon the Judgment reported in Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP and Another, (2020) 15 SCC 585 submits that as per the Statement of Objects and Reasons of the Commercial Courts Act, 2015 and the various amendments to the Civil Procedure Code and insertion of new rules to the Code applicable to suits of the commercial disputes shows that it has been enacted for the purpose of providing an early disposal of high value commercial disputes.
8. Mr. Ray relying upon the Judgment reported in T. Arivandandam vs. T.V. Satyapal and Another, (1977) 4 SCC 467 submits that the trial courts would insist imperatively on examining the party at the first hearing so that bogus litigation can be shot down at the earliest stage.
9. Mr. Ray relying upon the Judgment reported in Saleem Bhai and Others vs. State of Maharashtra and Others, (2003) 1 SCC 557 submits that the provisions of under Order 7 Rule 11 of the CPC makes it clear that the relevant facts which need to be looked for deciding an application thereunder are the averments in the plaint. The trial court can exercise the power under Order 7 Rule 11 of the CPC.
10. Mr. Ray relying upon the Unreported Judgment passed by the Hon’ble Division Bench of Calcutta High Court in FMAT No. 360 of 2022 M/s. Odisha Slurry Pipeline Infrastructure Limited and Another vs. IDBI Bank Limited and Another submits that compulsory mediation is foisted only on a plaintiff who does not contemplate urgent interim relief. It is implicit that it is only the plaintiff, that can contemplate the relief that it seeks in a suit and, pre-institution mediation is necessary only in cases where a plaintiff does not contemplate urgent relief.
11. Mr. Ray relying upon the Judgment reported in Laxmi Polyfab Private Limited vs. Eden Realty Ventures Private Limited and Another, 2021 SCC Online Cal 1457 submits that the distinction between ‘filing’ of a suit and its ‘institution’ requires the Courts to apply its mind at the time of the suit being presented before it, as to whether the plaintiff in a suit which does not contemplate any urgent relief under the Act of 2015 exhausted the remedy of pre-institution mediation in accordance with the manner and procedure prescribed or not. He submits that Sub-Section (1) of Section 12A of
Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP and Another
P.V. Guru Raj Reddy and Another vs. P. Neeradha Reddy and Others
The court emphasized the importance of pre-institution mediation in commercial disputes, the need for proper infrastructure and trained mediators, and the court's discretion to adjust equities for th....
Mandatory compliance with Section 12A of the Commercial Courts Act for Pre-Institution Mediation is required for the maintainability of commercial suits.
Section 12A of the Commercial Courts Act requires pre-institution mediation for suits not seeking urgent relief, establishing a mandatory procedural framework.
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....
Pre-litigation mediation under Section 12A of the Commercial Courts Act is mandatory; however, if mediation has occurred prior to suit registration, further mediation is not required.
Rejection of plaint – Commercial suit which does not contemplate any urgent relief under Commercial Courts Act shall not be instituted unless plaintiff exhausts remedy of Pre-Institution 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....
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.