Whether commercial court can refuse to entertain suit if the plaintiff has not exhausted the remedy of pre-institution mediation?

The learned Judge has directed to return the plaint on the ground that the petitioner should first exhaust the remedy of pre-institution mediation under Section 12(A)(1) of the Act. To see whether the invocation of Section 12(A)(1) of the Act in this case was right, it would be necessary to extract the provisions of Section 12(A)(1) of the Act. It reads as follows:

"12A. Pre-Institution Mediation and Settlement.- (1) A suit, which does not contemplate any urgent interim relief under this Act, shall not be instituted unless the plaintiff exhausts the remedy of pre-institution mediation in accordance with such manner and procedure as may be prescribed by rules made by the Central Government."

9. It can be seen from what is extracted above that it is only in cases where the suit does not contemplate any urgent interim relief that there is a bar for institution of the suit without the plaintiff exhausting the remedy of pre-institution mediation. The expression used in Section 12(A)(1) of the Act is "A suit which does not contemplate any urgent relief".

10. Unfortunately, the learned Judge has read the above expression to mean as if only in cases where the plaintiff is entitled to urgent interim relief, the provision will not apply. The entitlement of a party to an urgent relief is a matter that would come up for consideration if the suit is numbered and several aspects taken into account. What is required to satisfy Section 12(A)(1) of the Act is the contemplation of an urgent relief.

11. In any case, the very nature of a suit for injunction against infringement of a copyright, is such that urgent reliefs will invariably be contemplated. Therefore, it is completely wrong on the part of the Commercial Court to say that there is no urgency in the matter.

12. In view of the above, the impugned endorsement made on the plaint, filed by the petitioner, is wholly illegal and liable to be set aside. Accordingly, the revision is allowed, the impugned endorsement is set aside and the Commercial Court is directed to number the suit, if other procedural aspects are in order and proceed with the matter in accordance with law.

Telangana High Court

M/S.M K Food Products vs M/S.S H Food Products on 21 February, 2019

Bench: V Ramasubramanian, Shameem Akther

     CIVIL REVISION PETITION No.3690 of 2018


ORDER: (Per Hon'ble Sri Justice V. Ramasubramanian)

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Commercial Courts (Pre-Institution Mediation and Settlement) Rules, 2018, notified

The Central Government on 03-07-2018 has, in exercise of the powers conferred by sub-section (2) of Section 21A read with sub-section (1) of Section 12A of the Commercial Courts Act, 2015 (4 of 2016), notified the  Commercial Courts (Pre-Institution Mediation and Settlement) Rules, 2018.

Key Highlights of the Rules are as follows :—

Initiation of mediation process —

(1) A party to a commercial dispute needs to make an application to the Authority as per Form-1 in Schedule-I, either online/by post/by hand, for initiating mediation process along with Rs 1000 as fees payable to the Authority by demand draft/ online;

(2) The Authority shall, having regard to territorial and pecuniary jurisdiction and nature of commercial dispute, issue notice, as per Form-2 in Schedule-I through registered/speed post and electronic means, i.e., e-mail and like to the opposite party for appearing and giving consent to participate in mediation process on a date not beyond ten days from issue of notice.

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