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CALCUTTA HIGH COURT
Harish Tandon and Prasenjit Biswas, JJ.
M/s. Odisha Slurry Pipeline
Infrastructure Ltd. and Anr. – Appellants
versus
IDBI Bank Ltd. and Ors. – Respondents
F.M.A.T 360 of 2022 with CAN 1 of 2022 and F.M.A.T 314 of 2022 with CAN 1 of 2022 and F.M.A.T 258 of 2022 with CAN 1 of 2022 &
CAN 2 of 2022
Decided on 9.12.2022
(A) Commercial Courts Act, 2015 – Section 12-A – Civil Procedure Code, 1908 – Order VII, Rule 11 – Maintainability of commercial suit – Alternative remedy – Pre-institution mediation – Section 12A of Act is mandatory – Suit which does not contemplate any urgent interim reliefs cannot be instituted unless plaintiff exhausts mandatory remedy provided under Section 12A of Act – However, position would be different when suit contemplates an urgent interim relief – There is no other option left but to reject plaint provided plaintiff seeks urgent interim relief therein – Power of rejection of plaint can be exercised suo motu or an application of defendants under provisions of Order VII Rule 11 of CPC – Urgent interim relief is an expression of wide import and difficult to give exhaustive meaning – It varies from a case to a case – There is no impediment on part of Court at the time of presentation of plaint to apply to its mind to find out whether it involves any urgent interim reliefs. (Paras 4, 10, 11 and 12)
(B) Commercial Courts Act, 2015 – Section 13 – Civil Procedure Code, 1908 – Order 43 – Maintainability of appeal – Appeal is a creature of a statute unless provided for cannot be assumed nor inferred – Right of appeal flowing from a statutory provision has to be understood in such perspective and order which does not come within purview thereof cannot be said to be an appealable order nor an appeal can lie before appellate forum – Appeal under the Act shall not lie against order unless such order is specifically enumerated in Order 43 of Code of Civil Procedure and Section 37 of Arbitration and Conciliation Act – Provisions contained in Order 43 of Code and Section 37 of Arbitration and Conciliation Act has been incorporated in the Act by reference and there is no scope to expand horizon of said provisions which does not imbibe within itself any other orders beyond such a reference, appealable thereunder. (Para 17)
Result: Appeal disposed of.
JUDGMENT
Harish Tandon, J.—The slew of litigations have been percolated in the docket of the Court raising the questions which are common in nature though argued separately by the different set of counsels and were heard in phase manner as the point of law remained common and if decided would impact the decision several such litigations on the factual matrix.
2. The seminal question involved in the aforesaid matters relates to institutions of a suit involving commercial disputes covering the specified value without exhausted the pre litigation mediation contemplated under Section 12 A of the Commercial Courts Act, 2015 whether or not involving the urgent interim reliefs.
3. The Commercial Courts Act was promulgated in the year 2015 with the avowed object of securing the speedy disposal of the high value commercial disputes through a special forum i.e. by establishing the commercial Courts, Commercial Division and the Commercial Appellate Division of the High Court. At the time of birth of the said Act, there was no concept of pre-institution mediation which sees the light of the day after introduction of Chapter III-A of the said Act by Act 28th of 2018 w.e.f 3.5.2018. The said chapter contained only one section i.e. Section 12A which mandating that the suit shall not be instituted unless the plaintiff exhausts the remedy of pre-institution mediation. The aforesaid provisions further contained the provision that the period within which the pre-institution mediation has to be completed shall be excluded from the purview of the Limitation Act, 1963. The most important facet of the aforesaid provision introduced subsequently can further be visualised that the settlement arrived in a mediation process shall have the same status and effect that of the arbitral award and it can be reasonably inferred that the same is capable of being executed and/or enforced as a decree in accordance with the provision of the Code of Civil Procedure, 1908. The legislatures were conscious that the mediation process may consume a considerable time and the reliefs may be delayed, fixed the time in which the mediation process should be completed putting outer cap beyond which cannot be extended even a party consented for such extension. The object is laudable that the aforesaid newly inserted provision was not only to avoid the unnecessary explosion in the docket of the Court but acknowledges the party autonomy in resolving the disputes through such recognised process to avoid the time consumed in a conventional adjudicatory system and cost effected although the schedule prescribed therein includes a cost to be shared by both the parties which is minimal in comparison to the litigations travelling in the ordinary Civil Courts. The process of mediation is unique in the sense that the carriage of the proceedings remained with the parties as opposed to an ordinary litigation before the Civil Courts and the settlement bring the solace and/or satisfaction but restore the relationship which may have been temporarily broken and therefore, it is conventionally known as a win-win situation. There was a common discordant amongst the legal fraternity that the activation of the process of pre-institution mediation simply delayed the adjudicatory process and imposition of unnecessary expenditures. It is no doubt true that every dispute may not be settled through a mediation process and the innumerable cases received a death as the defendant either chose not to undergo such process or there is a failure on account of non-consensus between the litigating parties. The rules framed under the aforesaid Act contained the provision and in the event the defendant chose not to participate in the proceedings the report would be treated as non-starter. The concept of mediation though claimed to be new in the legal system yet, being introduced after a long discourse, it is a collective duty of the citizenry to accept the legislative intent as sensitised themselves to make it wo
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....
Section 12A of the Commercial Courts Act requires pre-institution mediation for suits not seeking urgent relief, establishing a mandatory procedural framework.
The requirement of pre-institution mediation under Section 12A of the Commercial Courts Act does not apply when urgent interim relief is sought in a commercial suit.
(1) Section 12A of Commercial Courts Act, 2015 is mandatory and enacted in larger public interest. Section 12A does not come into play if suit contemplates an urgent relief.(2) If plain meaning of wo....
Mandatory compliance with Section 12A of the Commercial Courts Act, 2015 for suits not contemplating urgent interim relief, and the prevention of deceptive invocation of urgent relief to circumvent t....
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....
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