Supreme Court: The Commercial court Act shall have overriding effect over Arbitration and Conciliation Act 1996

21. Act to have overriding effect--Save as otherwise provided, the provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law for the time being in force other than this Act.

10. Thus, the Objects and Reasons of Commercial Courts Act, 2015 is to provide for speedy disposal of the commercial disputes which includes the arbitration proceedings. To achieve the said Objects, the legislature in its wisdom has specifically conferred the jurisdiction in respect of arbitration matters as per Section 10 of the Act, 2015. At this stage, it is required to be noted that the Act, 2015 is the Act later in time and therefore when the Act, 2015 has been enacted, more particularly Sections 3 & 10, there was already a provision contained in Section 2(1)(e) of the Act, 1996. As per settled position of law, it is to be presumed that while enacting the subsequent law, the legislature is conscious of the provisions of the Act prior in time and therefore the later Act shall prevail. It is also required to be noted that even as per Section 15 of the Act, 2015, all suits and applications including applications under the Act, 1996, relating to a commercial dispute of specified value shall have to be transferred to the Commercial Court. Even as per Section 21 of the Act, 2015, Act, 2015 shall have overriding effect. It provides that save as otherwise provided, the provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force.

 IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 6876 of 2022, 6878 of 2022 and 6877 of 2022

Decided On: 19.10.2022

Jaycee Housing Pvt. Ltd. and Ors. Vs. Registrar (General), Orissa High Court, Cuttack and Ors.

Hon'ble Judges/Coram:

M.R. Shah and Krishna Murari, JJ.

Author: M.R. Shah, J.

Citation: 2022 INSC 1119,MANU/SC/1363/2022,(2023) 1 SCC 549

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Supreme Court: Plaint is liable to be rejected if there is violation of S 12-A of The Commercial courts Act for Pre-institution mediation

 The seminal question which arises for consideration is whether the statutory pre-litigation mediation contemplated Under Section 12A of the Commercial Courts Act, 2015 (hereinafter referred to as 'Act') as amended by the Amendment Act of 2018 is mandatory and whether the Courts below have erred in not allowing the applications filed Under Order VII Rule 11 of the Code of Civil Procedure, 1908 (hereinafter referred to as 'CPC'), to reject the plaints filed by the Respondents in these appeals without complying with the procedure Under Section 12A of the Act. {Para 2}

84. Having regard to all these circumstances, we would dispose of the matters in the following manner. We declare that Section 12A of the Act is mandatory and hold that any suit instituted violating the mandate of Section 12A must be visited with rejection of the plaint Under Order VII Rule 11. This power can be exercised even suo moto by the court as explained earlier in the judgment. We, however, make this declaration effective from 20.08.2022 so that concerned stakeholders become sufficiently informed.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 5333 of 2022.

Decided On: 17.08.2022

Patil Automation Private Limited and Ors. Vs. Rakheja Engineers Private Limited

Hon'ble Judges/Coram:

K.M. Joseph and Hrishikesh Roy, JJ.

Author: K.M. Joseph, J.

Citation:  MANU/SC/1004/2022.

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What are powers of the court under Case Management Hearing under Commercial Courts Act?

6. Powers of the Court in a Case Management Hearing. — (1) In any Case Management Hearing held under this Order, the Court shall have the power to—

(a) prior to the framing of issues, hear and decide any pending application filed by the parties under Order XIII-A;

(b) direct parties to file compilations of documents or pleadings relevant and necessary for framing issues;

(c) extend or shorten the time for compliance with any practice, direction or Court order if it finds sufficient reason to do so;

(d) adjourn or bring forward a hearing if it finds sufficient reason to do so;

(e) direct a party to attend the Court for the purposes of examination under Rule 2 of Order X;

(f) consolidate proceedings;

(g) strike off the name of any witness or evidence that it deems irrelevant to the issues framed;

(h) direct a separate trial of any issue; (i) decide the order in which issues are to be tried;

(j) exclude an issue from consideration;

(k) dismiss or give judgment on a claim after a decision on a preliminary issue;

(l) direct that evidence be recorded by a Commission where necessary in accordance with Order XXVI;

(m) reject any affidavit of evidence filed by the parties for containing irrelevant, inadmissible or argumentative material;

(n) strike off any parts of the affidavit of evidence filed by the parties containing irrelevant, inadmissible or argumentative material;

(o) delegate the recording of evidence to such authority appointed by the Court for this purpose;

(p) pass any order relating to the monitoring of recording the evidence by a commission or any other authority;

(q) order any party to file and exchange a costs budget;

(r) issue directions or pass any order for the purpose of managing the case and furthering the overriding objective of ensuring the efficient disposal of the suit.

(2) When the Court passes an order in exercise of its powers under this Order, it may—

(a) make it subject to conditions, including a condition to pay a sum of money into Court; and

(b) specify the consequence of failure to comply with the order or a condition.

(3) While fixing the date for a Case Management Hearing, the Court may direct that the parties also be present for such Case Management Hearing, if it is of the view that there is a possibility of settlement between the parties.

7. Adjournment of Case Management Hearing. — (1) The Court shall not adjourn the Case Management Hearing for the sole reason that the advocate appearing on behalf of a party is not present : Provided that an adjournment of the hearing is sought in advance by moving an application, the Court may adjourn the hearing to another date upon the payment of such costs as the Court deems fit, by the party moving such application.

(2) Notwithstanding anything contained in this Rule, if the Court is satisfied that there is a justified reason for the absence of the advocate, it may adjourn the hearing to another date upon such terms and conditions it deems fit.

8. Consequences of non-compliance with orders. — Where any party fails to comply with the order of the Court passed in a Case Management Hearing, the Court shall have the power to—

(a) condone such non-compliance by payment of costs to the Court;

(b) foreclose the non-compliant party's right to file affidavits, conduct cross-examination of witnesses, file written submissions, address oral arguments or make further arguments in the trial, as the case may be, or

(c) dismiss the plaint or allow the suit where such non-compliance is wilful, repeated and the imposition of costs is not adequate to ensure compliance.”

 In the High Court of Delhi at New Delhi

(Before Vibhu Bakhru and Amit Mahajan, JJ.)

Surya Food and Agro Limited Vs Om Traders and Another 

RFA(OS)(COMM) 28/2019

Decided on January 20, 2023

Citation: 2023 SCC OnLine Del 265.

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Delhi HC: The court can pass Summary judgment under O 13- A of CPC as amended by Commercial courts Act even after issues are framed

Though proviso to Rule 2 of Order XIIIA unequivocally lays down that no application for summary judgment may be made after the Court has framed the issues, but it cannot be forgotten that Supreme Court in ITC Limited v. Debts Recovery Appellate Tribunal (1998) 2 SCC 70 has held that merely because issues have been framed, is no reason for the trial to be undertaken, if it is brought to the notice of the Court that the same is not necessary. The Courts have in innumerable judgments referred to in Dr. Zubair Ul Abidin v. Sameena Abidin @ Sameena Khan, (2014) 214 DLT 340 (DB) (SLP(C) No. 369/370 preferred whereagainst was dismissed on 16th January, 2015), Geodis Overseas Pvt. Ltd. v. Punjab National Bank, 2016 SCC OnLine Del 1037 as well as in A.N. Kaul v. Neerja Kaul, 2018 SCC OnLine Del 9597 held that the Court on each and every date of hearing has to ensure that no litigation which is deadwood remains pending on the roster of the Court at the cost of other deserving litigations and it is the duty of the Court to eliminate the deadwood on each and every stage. Rule 1 of newly added Chapter XA of the Delhi High Court (Original Side) Rules, 2018, introduced with effect from 1st November, 2018 also permits the Court to, of its own, pass summary judgment at the time of Case Management Hearing which can also be post framing of issues in the suit. {Para 27}

28. The purpose of the proviso to Rule 2 of Order XIIIA is to discourage filing of applications for summary judgment after issues have been framed, thereby delaying trial and to empower the Court to, if finding the same to be dilatory, dismiss the same in limine. The proviso to Rule 2 of Order XIIIA, in my opinion, cannot be read mandatorily and to that extent is directory.

29. The objective of the Commercial Courts Act even otherwise is to expedite the disposal of the commercial suits and none of the provisions thereof can be interpreted as counterproductive to the said objective of the Commercial Courts Act and it would delay rather than expedite the disposal of commercial suits, if inspite of finding a suit to be befitting of summary judgment, the Court considers itself constrained merely on account of issues having been framed.

 In the High Court of Delhi at New Delhi

(Before Rajiv Sahai Endlaw, J.)

K.R. Impex Vs Punj Lloyd Ltd. 

CS(COMM) 646/2016

Decided on January 8, 2019

Citation: 2019 SCC OnLine Del 6667.

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