The main legal point established in the judgment is the interpretation of the definition of 'Commercial Dispute' under Section 2(1)(c-xviii) of the Act of 2015 and the prospective effect of the mandatory nature of Section 12-A regarding pre-institution mediation.

ORDER :

(Sushrut Arvind Dharmadhikari, J.)

This Miscellaneous Petition under Article 227 of the Constitution of India assails the order dated 01.07.2022 (Annexure-P/4) passed in Comms-20/2022 whereby the application under Order 7 Rule 11 of the Code of Civil Procedure, filed by the petitioners/defendants has been rejected.

2. Briefly stated facts of the case are that the respondents are plaintiffs before the trial Court who have filed a suit for recovery under Order 7 Rule 1 of the CPC read with Section 16 of the Commercial Courts Act, 2015 (hereinafter referred to as the Act of 2015). On the basis of the transactions and averments, plaintiffs have sought recovery of the amount. After issuance of notice, petitioners/defendants filed an application under Order 7 Rule 11 of CPC contending that Section 2 of the Commercial Courts Act defines "Commercial Disputes" and looking to the aforesaid definition, the alleged transaction is not covered under any of the clauses mentioned in Section 2 of the Act and therefore, the provisions of the Act are not applicable and the plaint is liable to be rejected. Another ground that was raised in the application was the non-compliance of Section 12-A of the Act as the suit was filed without exhausting the remedy of pre-institution mediation, hence the same is not maintainable.

3. Learned trial Court, while passing the impugned order held that as per Section 2 (1)(c-xviii) which provides for 'Agreement for sale of goods or provisions of services', there is a commercial dispute between the parties. It was further held that the compliance of provisions of Section 12-A of the Act of 2015 is not mandatory, and accordingly the application under Order 7 Rule 11 filed by the petitioners/defendants was rejected. Hence, this petition.

4. Learned counsel for the petitioners contended that the trial Court has failed to consider that the alleged transactions cannot be said to be falling within the purview of the commercial dispute as defined under Section 2 of the Act of 2015. If a recovery suit is treated to be and tried in Commercial Court, then the purpose of enactment of the Act of 2015 will be frustrated. Further, the trial Court has erred in holding that compliance of Section 12-A of the Act are not mandatory. The provisions of Section 12-A is clear and unambiguous, which shows that a suit which does not contemplate any urgent interim relief under this Act cannot be instituted unless the plaintiff exhausts the remedy of pre-institution mediation. Hence, the impugned order passed by the trial Court is illegal and contrary to law and deserves to be set aside. In support of his contention, learned counsel for the petitioners placed reliance on the judgment passed by the Apex Court in case of Patil Automation Pvt. Ltd. & Ors. vs. Rakheja Engineers Pvt. Ltd., (2022) 10 SCC 1.

5. Per contra, learned counsel for the respondents opposed the prayer and submitted that the dispute between the parties is a commercial dispute under Section 2(1)(c-xviii) of the Act of 2015 since there was implied contract between the parties for supply of goods. Learned counsel for the respondents placing reliance on the judgment of the Apex Court in case of Patil Automation (Supra) further contended that the mandatory effect of Section 12-A is prospective in nature and shall be effective from 20.08.2022. No retrospective effect is provided to the said mandate and hence it is not applicable on the suits which were instituted prior to 20.08.2022 without due compliance of Section 12-A. It is further contended that the impugned order is based on legal ground as it was decided on 01.07.2022 based upon the prevailing law laid down in catena of judgments wherein it was held that the suits shall not be dismissed for non-compliance of Section 12-A as the procedural law prescribes procedure to facilitate the justice. He further submitted that the petitioners/defendants have a remedy of filing a revision petition under Section 115 of the CPC agains