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THE HIGH COURT OF KARNATAKA
M. Nagaprasanna,J
MR.P.VASUDEVA KAMATH – Appellant
Versus
MRS. JAYASHRI R. KAMATH – Respondent
Commercial O.S.No.302 of 2024
Certainly. Based on the provided legal document, here are the key points summarized:
Pre-litigation Mediation Requirement: Section 12A of the Commercial Courts Act mandates that a commercial suit cannot be instituted unless the plaintiff exhausts pre-institution mediation, except when urgent interim relief is sought (!) (!) .
Substantial Compliance: If mediation has already taken place prior to the filing or transfer of the suit, the commercial court is not required to mandate fresh mediation. The court recognizes that substantial compliance with Section 12A occurs when mediation efforts are undertaken before the suit's registration or transfer (!) (!) .
Order of Suit Transfer and Filing: When a suit initially filed as a non-commercial suit is transferred to a commercial court after efforts at mediation, the requirement of re-mediation is waived if there has been prior substantial compliance (!) (!) .
Order of Rejection of plaint: A suit cannot be rejected solely on the grounds of non-compliance with Section 12A if there has been prior mediation and the suit is otherwise properly instituted and transferred (!) (!) (!) .
Court's Discretion and Justice: Courts have the discretion to keep a suit in abeyance and refer parties to mediation, especially where efforts at settlement have been ongoing and have failed, provided there is no prejudice to the parties (!) .
Rejection of Application under Order VII Rule 11: Applications seeking rejection of a plaint on the basis of non-compliance with Section 12A should be dismissed if there has been substantial prior mediation, and the suit is otherwise valid and properly transferred (!) .
Legal Effect of Mediation and Transfer: When mediation occurs before the registration or transfer of a suit and results in failure, the commercial court is justified in proceeding without requiring fresh mediation efforts. This is consistent with the principle that once substantial compliance is established, re-mediation is unnecessary (!) (!) .
Overall Legal Principle: The mandate of Section 12A is to promote settlement and avoid multiplicity of litigation. However, strict adherence to pre-institution mediation is not necessary if there has been prior genuine effort, especially when the suit has been transferred or re-filed in a different court after prior mediation attempts (!) (!) (!) .
Merits of the Petition: The petition challenging the order rejecting the application for rejection of plaint on the ground of non-compliance with Section 12A lacks merit when prior mediation efforts have been demonstrated, and the suit has been properly transferred or instituted (!) .
These points collectively emphasize that prior substantial compliance with Section 12A through genuine mediation efforts can fulfill the legal requirement, and courts are empowered to proceed with the suit without mandating fresh mediation upon transfer or re-institution, provided justice and procedural fairness are maintained.
| Table of Content |
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| 1. the relationship between the plaintiff and defendants is established as landlord and tenant. (Para 2 , 3) |
| 2. arguments presented regarding the necessity of pre-litigation mediation under section 12a. (Para 4 , 5) |
| 3. court's observations on the application of section 12a and prior mediation efforts. (Para 6 , 7 , 8 , 9 , 10 , 11) |
| 4. court's ruling on the application of section 12a and the distinction between return of plaint and transfer of suit. (Para 12 , 13) |
CAV ORDER
The petitioners are before this Court calling in question an order dated 28-02-2025 passed by the IV Additional District and Sessions Judge, Mangalore in Commercial O.S.No.302 of 2024 whereby application filed by the petitioners/defendants under Order VII Rule 11 of the CPC comes to be dismissed.
2. Facts, in brief, germane are as follows: -
The petitioners are the defendants/tenants and respondent is the plaintiff/owner. The plaintiff institutes a suit in O.S.No.245 of 2023 seeking delivery of vacant possession of the suit schedule property and clearance of arrears of rent. In the suit, for about 6 months, the matter was adjourned for settlement between the parties. An application comes to be filed for return of the plaint on the ground that the issue in the lis has to be adjudicated before the Commercial Court under the Commercial Courts Act, 2015 . The application is answered and the plaint is returned to be presented before the Commercial Court. It then becomes a commercial original suit in Commercial O.S.No.302 of 2024. Once the plaint is returned and presented before the Commercial Court, an application comes to be filed by the defendants under Order VII Rule 11 of the CPC seeking rejection of the plaint on the score it is barred by law, as the mandate of the Commercial Courts Act insofar as it concerns Section 12A is not followed. The concerned Court, by the impugned order, rejects the said application and holds that there was no infirmity in the entertainment of the suit, notwithstanding the fact of non-compliance with Section 12A of the Commercial Courts Act. The rejection of the application filed by the defendants is what has driven them to this Court in the subject petition.
3. Heard Sri Vigneshwar S. Shastri, learned senior counsel appearing for the petitioners and Sri Dhananjay V. Joshi, learned senior counsel appearing for the respondent.
4. The learned senior counsel Sri Vigneshwar S. Shastri appearing for petitioners would vehemently contend that the mandate of law is that pre-institution mediation and settlement as per Section 12A is mandatory. It is immaterial if settlement talks were on before the plaint was presented before the Commercial Court. He would contend that unless Section 12A is preceded before entertainment of the suit, the commercial O.S. is not maintainable.He would seek to place reliance upon plethora of judgments on the issue.
5. Per contra, the learned senior counsel Sri Dhananjay V.Joshi would refute the submissions in contending that Section 12A though depicts that no commercial O.S. shall be initiated prior to compliance with Section 12A , he would submit that all nuances of pre-institution mediation and settlement has already taken place before the concerned Court when it was at the stage of original suit. Today to send it back again for nothing would become a travesty. He would, therefore, submit that there is nothing wrong in the order passed by the concerned Court. He would seek dismissal of the petition. To buttress his submission, he would also place reliance upon several judgments of the Apex Court and constitutional Courts. The judgments so relied on by each of the parties would be considered qua their relevance in the course of the order.
6. I have given my anxious consideration to the submissions made by the respective learned senior counsel and have perused the material on record.
7. The issue in the lis lies in a narrow compass. The relationship between the plaintiff and the defendants being l
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