Source: Bombay High Court

Why in News?

Recently, a bench of Justices Sujoy Paul and Vivek Jain was hearing a petition against the commercial court’s decision.

• Madhya Pradesh High Court gave this judgment in the case of Itarsi Pipes Sales & Anr. v. OMRF Pipes and Products & Ors.

What is the Background of Itarsi Pipes Sales & Anr. v. OMRF Pipes and Products & Ors.?

• The respondents/plaintiffs initiated a commercial suit wherein notices were served to the petitioners/defendants, received on 21^st March 2023.
• The petitioners appeared before the Commercial Court on 10^th April 2023, but their written statement was filed belatedly on 09^th August 2023.
• The issue arose whether the statement, filed beyond 120 days, could be accepted.
• The Commercial Court, referencing the CPC and Supreme Court judgments SCG Contracts (India) Private Limited v. K.S. Chamankar Infrastructure Private Limited and others (2019) and Prakash Corporates v. Dee Vee Projects Limited (2022), concluded that defendants No. 1 & 2 failed to meet the extended 120-day limit, rendering the statement inadmissible.
• Consequently, the Court declined to admit the written statement.

What was the Court’s Observation?

• The MP High Court observed that “the Commercial Court has taken a plausible view which is in consonance with law”.

What is the Commercial Courts Act, 2015?

• About:
  • The Commercial Courts Act, 2015 emerged against the backdrop of the growing complexities within India’s commercial landscape.
  • It came into force on 23^rd October 2015 as Act No. 4 of 2016.
  • With the expansion of commerce, disputes inevitably arise, necessitating efficient mechanisms for their resolution.
  • Recognizing the need for expeditious and specialized dispute resolution forums, the Act was conceived to cater specifically to the needs of commercial litigants.
• Key Provisions:
  • Establishment of Commercial Courts:
    • The Act mandates the establishment of commercial courts at the district level, ensuring accessibility and proximity to commercial litigants across the country.
    • These courts are equipped with jurisdiction over specified commercial matters, thereby fostering expertise and efficiency in adjudication.
  • Definition of Commercial Disputes:
    • The Act delineates the scope of commercial disputes, encompassing a wide array of commercial transactions, contracts, and agreements. By providing clarity on the types of disputes falling within its purview, the Act enhances predictability and coherence in commercial litigation.
  • Expedited Proceedings:
    • One of the salient features of the Act is its emphasis on expeditious dispute resolution.
    • Timelines are prescribed for various stages of litigation, ensuring swift disposal of cases and minimizing delays.
    • This expedited process is instrumental in mitigating the costs and uncertainties associated with prolonged litigation.
  • Specialized Adjudication:
    • Commercial courts constituted under the Act are manned by judges with specialized knowledge and experience in commercial matters.
    • This expertise enables courts to render informed decisions promptly, fostering confidence among litigants and stakeholders in the judicial process.