IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SUNITA AGARWAL, C.J., PRANAV TRIVEDI, J.
M/s Sikkim Ferro Alloys Ltd. - Petitioner
Versus
Shah Alloys Limited Through Company Secretary, Vinod Kumar Shah - Respondent
R/Special Civil Application No. 16199 of 2023
Decided On : 21-08-2024
Jurisdiction - Supervisory Jurisdiction - Article 227 - Commercial Court Act, 2015 - The court interpreted the provisions of the Commercial Court Act, particularly the discretion conferred to the Commercial Court regarding timelines for filing written statements, affirming the closure of the defendant's opportunity to file due to inaction.
Fact of the Case:
The petitioner challenged the Commercial Court's order closing the opportunity to file a written statement in a commercial suit, citing delays and absence of action from the defendant's side.
Finding of the Court:
The court found that the defendant had consistently delayed proceedings and failed to file a written statement within the statutory period, justifying the Commercial Court's decision to close the opportunity.
Issues: Whether the Commercial Court erred in closing the opportunity for the defendant to file a written statement and whether the timelines under the Code of Civil Procedure applied post-transfer of the suit.
Ratio Decidendi: The court held that the discretion under the Commercial Court Act allows the court to close opportunities based on the facts of the case, and the timelines in the Code of Civil Procedure do not automatically apply to transferred suits.
Result: The petition was dismissed.
ORDER :
Sunita Agarwal, C.J.
Heard the learned counsel appearing for the petitioner and perused the record.
2. The present petition invoking the supervisory jurisdiction of this Court under Article 227 of the Constitution of India is directed against the order passed by the Commercial Court in closing the opportunity of the defendant/petitioner herein to file written statement in the Commercial Suit.
3. Pertinent is to note that in the order dated 25.07.2022 in the Commercial Civil Suit No. 3482 of 2021, the Commercial Court noted that the learned advocate for the defendant was present. On perusal of the record, it further noted that the defendant had been duly served with the process and the vakalatnama was filed by the learned advocate appearing for the defendant vide Exh. 12 on 21.02.2019, however, no written statement had been filed till 25.07.2022. Noticing that more than 120 days had expired since the service of the summons, in the facts of the case, it was directed that right of the defendant to file written statement be closed. We may further note that an application seeking for recall of the order dated 25.07.2022 was filed by the defendant on 21.02.2023, who was otherwise represented through his counsel, which has also been dismissed on the same date, noticing that the statutory limitation had already lapsed long back and the application cannot be allowed.
4. By means of the instant petition presented on 23.08.2023, the petitioner has sought the following reliefs :-
“A. Your Lordships be pleased to issue writ of certiorari or any other appropriate writ, order, or direction in nature of certiorary quashing and setting aside order passed below Exh. 19 in the Commercial Civil Suit No. 3482 of 2021 passed by the Learned Judge, Commercial Court, City Civil Court, Ahmedabad and thereby allow the application vide Exh. 19 in Commercial Civil Suit no. 3482 of 2021 pending before the Learned Judge, Commercial Court, City Civil Court, Ahmedabad;
B. Pending admission, hearing and final disposal of this petition, your Lordships be pleased to stay the further proceedings in Commercial Civil Suit no. 3482 of 2021 pending before the Learned Judge, Commercial Court, City Civil Court, Ahmedabad.”
5. The challenge essentially is to the order passed on Exh.19 dated 21.o2.2023, i.e. on recall application. And there is no challenge to the order dated 25.07.2022 whereby the opportunity to the defendant to file the written statement had been closed.
6. Be that as it may, by means of the order dated 25.06.2024, we have directed the learned advocate for the petitioner to file the complete copies of the order sheet of the Civil Suit No. 1473 of 2017, which was converted into the Commercial Civil Suit No. 3482 of 2021. The order sheet brought on record alongwith the affidavit filed by the petitioner on 8.7.2024, indicates that the original suit was presented before the City Civil Court at Ahmedabad on 19.09.2017 and summons were issued on 26.12.2017. On various dates, the process/summons issued to the defendants returned unserved for one or other reasons and the matter remained pending for long. Ultimately, the defendant was served through the Registered A.D.Post and had put in appearance before the Civil Court on 29.01.2019 through an advocate, who filed an undertaking for filling vakalatnama. The matter was again adjourned on the request of the learned advocate appearing for the defendant on the next date fixed, which was 05.02.2019. The vakalatnama was filed by the learned advocate appearing for the defendant namely the petitioner herein on 21.02.2019. The order sheet dated 15.03.2019 records that the defendant or his advocate had not given application for time to file written statement and in absence of the written statement, the suit is undefended.
7. On various dates thereafter fixed in the year 2021, the defendant’s advocate remained absent, which is evident from the copy of the order sheet dated 02.03.2021, 23.06.2021, 07.07.2021 and 22.07.2021.
AI
The court affirmed that the Commercial Court has discretion under the Commercial Court Act to close opportunities for filing written statements based on case-specific circumstances.
The judgment emphasized the mandatory nature of the 120-day limitation for filing a written statement and the lack of discretion for condonation of delay, as supported by relevant legal provisions an....
The main legal point established in the judgment is the requirement for the defendant to file the written statement within the prescribed period, the consequences of failing to do so, and the applica....
The interpretation of procedural rules regarding the filing of written statements and the discretion of the court to permit filing beyond the stipulated period based on sufficient cause.
In commercial suits, a written statement filed beyond 30 days without a condonation application may not be accepted, emphasizing strict adherence to procedural timelines.
The right to file a written statement is forfeited after 120 days unless justifiable grounds for extension are shown, requiring substantive reasoning recorded by the court.
The court affirmed that defendants lose the right to file a written statement if not submitted within the prescribed 120 days, highlighting the necessity of adhering to procedural timelines in commer....
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