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2021 Supreme(Mad) 3367

IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. ANAND VENKATESH, J.
S.V.D. Jeevanand – Appellant
Versus
NIC Arts through its Proprietor, S.S. Chakaravarthi, Chennai & Another – Respondent
C.S. No. 568 of 2015
Decided On : 24-11-2021

Appearing Advocates:
For the Plaintiff :K. Chandrasekaran, Advocate.
For the Respondents:R1, Anbarasi Rajendran, AAV Partners, Advocate.

Headnote:

Commercial Dispute - Jurisdiction - Commercial Courts Act, 2015 - Section 2(1)(c)(i) - [Order 7, Rule 1 of C.P.C. read with Order 4, Rule 1 of O.S. Rules] - [Summary of Acts and Sections: The court discussed the scope of Section 2(1)(c)(i) of the Commercial Courts Act, 2015 and its interpretation in relation to mercantile documents, ordinary transactions of merchants, bankers, financiers, and traders. The court referred to various judgments to determine the nature of the dispute and the applicability of the Act. The judgment emphasized the need for a transaction to have a commercial flavor and economic benefit to be considered a commercial dispute under the Act.]

Fact of the Case:

The Plaintiff filed a Civil Suit under Order 7, Rule 1 of C.P.C. read with Order 4, Rule 1 of O.S. Rules, seeking a judgment and decree against the Defendants for a sum of Rs.1,00,00,000 with interest, permanent injunction, and costs. The Defendant raised a fundamental issue regarding the jurisdiction of the Commercial Division to try the case, leading to a detailed analysis by the Court.

Finding of the Court:

The Court found that the dispute fell within the definition of a commercial dispute under the Commercial Courts Act, 2015, based on the nature of the transaction and the economic benefit to the Plaintiff. The Court reiterated its earlier order determining the jurisdiction of the Commercial Division to try the case.

Issues: The fundamental issue raised was whether the dispute satisfied the requirement of Section 2(1)(c)(i) of the Commercial Courts Act, 2015, and whether the case should be tried by the Commercial Division.

Ratio Decidendi: The Court's decision was based on the interpretation of Section 2(1)(c)(i) of the Commercial Courts Act, 2015, and the applicability of the term 'mercantile documents' in defining a commercial dispute. The Court emphasized the need for a transaction to have a commercial flavor and result in economic benefit to be considered a commercial dispute under the Act.

Final Decision: The Court held that the facts of the case fell within the definition of a commercial dispute, reiterating its earlier order determining the jurisdiction of the Commercial Division to try the case.

JUDGMENT :-

(Prayer: Civil Suit has been filed under Order 7, Rule 1 of C.P.C. read with Order 4, Rule 1 of O.S. Rules, praying to pass Judgment and Decree against the Defendants-

(a) Directing the 1st Defendant to pay to the Plaintiff a sum of Rs.1,00,00,000 with subsequent Interest at the rate of 18% per annum from the date of Plaint till the date of realization.

(b) Permanent Injunction restraining the Defendants from releasing the Tamil feature colour film Vaalu till the 1st Defendant pays and discharges the said sum of Rs.1,00,00,000 with Interest at the rate of 18% per annum from the date of Plaint till the date of realization.

(c) Directing the Defendants to pay to the Plaintiff the Costs of the Suit).

1. When the matter was taken up for hearing on 10.11.2021, the learned Counsel appearing on behalf of the Plaintiff raised a fundamental issue with regard to continuation of the Suit before the Commercial Division on the ground that the dispute in question may not satisfy the requirement of Section 2(1)(c)(i) of 'the Commercial Courts Act, 2015' [hereinafter 'said Act' for the sake of convenience and clarity]. In view of the same, this Court passed the following Order on 10.11.2021:

'This Court was passing common Orders in both the Suits and in fact Case Management Order was passed for both the Suits and the matter is now at the stage of cross-examination of PW1 in C.S. No.567 of 2015. Since the time lines fixed by this Court has expired, the matter is posted before this Court for rescheduling the time.

2. The learned Counsel appearing on behalf of the Plaintiff in C.S. No.568 of 2015 submitted that the nature of transaction that is involved in this case may not fall within the ambit of a Commercial dispute as defined under the Act. The learned Counsel, therefore, submitted that this issue has to be taken into consideration, since it touches upon the very jurisdiction of the Commercial division to try this case.

3. In the considered view of this Court, this ground has been taken up for the first time and some Orders have already been passed in this Suit namely C.S. No.568 of 2015 as if it comes within a Commercial Dispute. However, that cannot be a ground for this Court to proceed further by putting the Doctrine of Estoppel against the Plaintiff, since there is no estoppel against a Statute. This issue has to be immediately fixed before proceeding further.

4. The learned Counsel appearing on either side shall make their submissions in this regard. Based on the decision taken by this Court, further Orders will be passed rescheduling the Case Management.

    5. Post this case under the caption "FOR DETERMINATION OF JURISDICTION" on 17.11.2021."

2. When the matter was taken up for hearing on 17.11.2021, this Court passed the following order:

"The learned Counsel appearing on either side relied upon two Judgments, one of this Court and another of Delhi High Court. In both these Judgments, the scope of Section 2(1)(c)(i) of the Commercial Courts Act, 2015 alone is explained and this Court had no occasion to go into the real meaning of the term 'Mercantile Documents'. The learned Counsel appearing on either side shall assist this Court and explain as to what documents will constitute mercantile documents. This will enable this Court to pass further Orders while determining the jurisdiction.

2. Post this case under the same caption on 24.11.2021"

3. When the matter was taken up for hearing today, the learned Counsel appearing on behalf of the Defendant submitted that this Court had already passed an Order on 13.12.2018, wherein this Court had found that the present Suit falls within the jurisdiction of Commercial Division and thereby the jurisdiction was determined. The learned Counsel therefore, submitted that the same exercise need not be undertaken once again and the present Suit and the connected Suit can proceed further with the trial. This Court had the advantage of hearing both sides. It is true that this Court had already determined the

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