Meaning of Commercial Disputes as Secion 2 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015

2. (1) In this Ordinance, unless the context otherwise requires,- (c) "commercial dispute" means a dispute arising out of-

(i) ordinary transaction of merchants, bankers, financiers and trade such as those relation to mercantile documents, including enforcement and interpretation of such documents;

 (ii) export or import of merchandise or services;

 (iii) issues relating to admiralty and maritime law;

 (iv) transactions relating to aircraft, aircraft engines, aircraft equipment and helicopters, including sales, leasing and financing of the same;

(v) carriage of goods; (vi) construction and infrastructure contracts, including tenders;

 (vii) agreements relating to immovable property used exclusively in trade or commerce;

 (viii) franchising agreements;

(ix) distribution and licensing agreements;

 (x) management and consultancy agreements;

 (xi) joint venture agreements;

 (xii) shareholders agreements;

(xiii) subscription and investment agreements pertaining to the service industry including outsourcing services and financial services;

 (xiv) mercantile agency and mercantile usage;

(xv) partnership agreements; (xvi) technology development agreements;

 (xvii) intellectual property rights relating to registered and unregistered trademarks, copyright, patent, design, domain names, geographical indications and semiconductor integrated circuits;

 (xviii) agreements for sale of goods or provision of services;

 (xix) exploitation of oil and gas reserves or other natural resources including electromagnetic spectrum; (xx) insurance and re-insurance;

 (xxi) contracts of agency relating to any of the above; and

 (xxii) such other commercial disputes as may be notified by the Central Government. Explanation.- A commercial dispute shall not cease to be a commercial dispute merely because- (a) it also involves action for recovery of immovable property or for realisation of monies out of immovable property given as security or involves any other relief pertaining to immovable property; (b) one of the contracting parties is the State or any of its agencies or instrumentalities, or a private body carrying out public functions.

Section 15 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015

15.(1) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996, relating to a commercial dispute of Specified Value pending in a High Court where a Commercial Division has been constituted, shall be transferred to the Commercial Division.

(2) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996, relating to a commercial dispute of Specified Value pending in any civil Court in any district or area in respect of which a Commercial Court has been constituted, shall be transferred to such Commercial Court: Provided that no suit or application where the final judgment has been reserved by the Court prior to the constitution of the Commercial Division or the Commercial Court shall be transferred either under sub-Section (1) of sub-Section (2).

(3) Where any suit or application, including an application under the Arbitration and Conciliation Act, 1996, relating to a commercial dispute of Specified Value shall stand transferred to the Commercial Division or Commercial Court under sub Section (1) or sub-Section (2), the provisions of this Ordinance shall apply to those procedures that were not complete at the time of transfer.

 (4) The Commercial Division or Commercial Court, as the case may be, may hold case management hearings in respect of such transferred suit or application in order to prescribe new timelines or issue such further directions as may be necessary for a speedy and efficacious disposal of such suit or application in accordance with Order XIV-A of the Code of Civil Procedure, 1908: Provided that the proviso to sub-rule (1) of Rule 1 of Order V of the Code of Civil Procedure, 1908 shall not apply to such transferred suit or application and the court may, in its discretion, prescribe a new time period within which the written statement must be filed.

 (5) In the event that such suit or application is not transferred in the manner specified in such-section (1), subsection (2) or sub-Section (3), the Commercial Appellate Division of the High Court may, on the application of any of the parties to the suit, withdraw such suit or application from the court before which it is pending and transfer the same for trial or disposal to the Commercial Division or Commercial Court, as the case may be, having territorial jurisdiction over such suit, and such order of transfer shall be final and binding.

Section 10 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015

Section 10  of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015

10. Whereas the subject matter of an arbitration is a commercial dispute of a Specified Value and –

(1) If such arbitration is an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that have been filed in a High Court, shall be heard and disposed of by the Commercial Appellate Division where such Commercial Appellate Division has been constituted in such High Court.

 (2) If such arbitration is other than an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that have been filed on the original side of the High Court, shall be heard and disposed of by the Commercial Appellate Division where such Commercial Appellate Division has been constituted in such High Court.

 (3) If such arbitration is other than an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that would ordinarily lie before any principal civil court of original jurisdiction in a district (not being a High Court) shall be filed in, and heard and disposed of by the Commercial Court exercising territorial jurisdiction over such arbitration where such Commercial Court has been constituted.

Format and guidelines of affidavit of evidence, THE COMMERCIAL COURTS, COMMERCIAL DIVISION AND COMMERCIAL APPELLATE DIVISION OF HIGH COURTS ORDINANCE, 2015

Format and guidelines of affidavit of evidence.

(THE COMMERCIAL COURTS, COMMERCIAL DIVISION AND COMMERCIAL APPELLATE DIVISION OF HIGH COURTS ORDINANCE, 2015)

An affidavit must comply with the form and requirements set forth below:

(a) such affidavit should be confined to, and should follow the chronological sequence of, the dates and events that are  relevant for proving any fact or any other matter dealt with;

(b) where the Court is of the view that an affidavit is a mere reproduction of the pleadings, or contains the legal grounds of any party's case, the Court may, by order, strike out the affidavit or such parts of the affidavit, as it deems fit and proper;

(c) each paragraph of an affidavit should, as far as possible, be confined to a distinct portion of the subject;

(d) an affidavit shall state-

(i) which of the statements in it are made from the deponent's own knowledge and which are matters of information or belief; and

(ii) the source for any matters of information or belief.

(e) an affidavit should-

(i) have the pages numbered consecutively as a separate document (or as one of several documents contained in a file);

(ii) be divided into numbered paragraphs;

(iii) have all numbers, including dates, expressed in figures; and

(iv) if any of the documents referred to in the body of the affidavit are annexed to the affidavit or any other pleadings, give the annexure and page numbers of such documents that are relied upon.".

 FORMAT STATEMENT OF TRUTH BY WAY OF AFFIDAVIT

STATEMENT OF TRUTH, BY WAY OF AFFIDAVIT

IN THE COURT OF-------------

ABC                                                                     PETITIONER

VS.

XYS                                                                      RESPONDENT

STATEMENT OF TRUTH BY WAY OF AFFIDAVIT

STATEMENT OF TRUTH BY, [party position and name of party in full] I, the deponent above-named, do hereby solemnly affirm  and declare as under I, ------ S/o Sh.-------, aged about ---- Years, working having its  registered office at    ---------------------------------- ,

I, the deponent above-named, do hereby solemnly affirm and declare as under:-

1.       I am Mr. [name of party and relevant details]  ------------------ in the above-captioned Petition and competent to swear this affidavit.

2.       I am sufficiently conversant with the facts of the case and have also examined all relevant documents and records in relation thereto.

3.       I say that the statements made in [mention specific paragraph numbers] Paragraphs --- to ---- are true to my knowledge and statements made in [mention specific paragraph numbers] paragraphs --- to --- are based on information received which I believe To be correct and statements made in [mention specific paragraph numbers]paragraphs --to-- are I  based on legal advice.

4.       I say that there is no false statement or concealment of any material fact, document or record and I have included information that is according to me, relevant for the present suit.

5.       I say that that all documents in my power, possession, control or custody, pertaining to the facts and circumstances of the proceedings initiated by me have been disclosed with the Petition.

6.       I say that the above-mentioned pleading comprises of a total of [number of pages] ---pages, each of which has been signed by me.

7.       I state that the documents hereto are true copies of the documents referred to and relied upon by me.

8.       I say that I am aware that for any false statement or concealment, I shall be liable for action taken against me under the law.

Place:

Date:

VERIFICATION

The statements made above are true to my knowledge.

Verified at-------on------.

Guidelines of affidavit of evidence

Chapter 5, The commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

CHAPTER V TRANSFER OF PENDING SUITS

15. (1) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996, relating to a  commercial dispute of Speciiied Value pending in a High Court where a Commercial Division has been constituted, shall be transferred to the Commercial Division.
(2) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996, relating to a commercial dispute of Specified Value pending in any civil court in any district or area in any of which a Commercial Court has been constituted, shall be transferred to such Commercial Court:

Provided that no suit or application where the final judgment has been reserved by the Court prior to the constitution of the Commercial Division or the Commercial Court shall be transferred either under sub-section (1) or sub-section (2).

(3) Where any suit or application, including an application under the Arbitration and Conciliation Act, 1996, relating to a commercial disPute of Specified Value shall stand transferred to the Commercial Division or Commercial Court under sub-section (1) or sub-section (2), the provisions of this Ordinance shall apply to those procedures that were not complete at the time of transfer.

4) The Commercial Division or Commercial Court, as the case may be, may hold case management hearings in respect of such transferred suit or application in order to prescribe new timelines or issue such further directions as may be necessary for a speedy and etiicacious disposal of such suit or application in  accordance with Order XIV-A of the Code of Civil Procedure, 1908: '

Provided that the proviso to sub-rule (1) of Rule 1 of Order V of the Code of Civil Procedure, 1908 shall not apply to such transferred suit or application and the court may, in its discretion, prescribe a new time period within which the written statement must be filed.

(5) In the event that such suit or application is not transferred in the manner Speciiied in sub-section (1), sub-section (2) or sub- section (3), the Commmial Appellate Division of the High Court may, on the application of any of the parties to the suit, withdraw such suit 0r application from the court before which it is pending and transfer the same for trial or disposal to the Commercial Division or Commercial Court, as the case may be, having territorial jurisdiction over such suit, and such order of transfer shall be final and binding. .

Schedule, The commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

SCHEDULE (See section17)

1. In section 26 of the Code of Civil Procedure, 1908 (hereafter referred to as the Code), in sub-section (2), the following proviso shall be inserted, namely:—

“Provided that such an affidavit shall be in the form and manner as prescribed under Order VI Rule 15A"

2. For section 35 of the Code, the following section shall be substituted, namely:—

“35.(l) In relation to any commercial dispute, the Court,

notwithstanding anything contained in any other law for the time being in force or Rule, has the discretion to determine:

(a) whether costs are payable by one party to another;

(b) the quantum of those costs; and (e) when they are to be paid.

Explanation.—— For die purpose of clause (a), the expression “costs” shall mean reasonable costs relating to—

(i) the fees and expenses of the witnesses incurred; (ii) legal and expenses incurred;

(iii) any other expenses incurred iri connection with the proceedings.

(2) If the Court decides to make an order for payment of costs, the general rule is that the unsuccessful party will .be ordered to pay the costs of the successful party:

Provided that the Court may make an order deviating from the general rule for reasons to be recorded in writing.

Illustration: The Plaintiff, in his suit, seeks a money decree for breach of contract, and damages. The Court holds that the Plaintiff is entitled to the money decree. However, it returns a finding that the claim for damages is frivolous and vexatious.

In such circumstances the Court may impose costs on the Plaintiff,

despite the Plaintiff being the successful party, for having raised frivolous claims for damages.
3 In making an order. for the payment of costs the court shall have regard to the following circumstances, including .—

(a) the conduct of the parties;

(b) whether a, party has succeeded on part of its case, even if that party has not been wholly successful;

- (e) whether the party had made a frivolous counter-claim leading to delay in the disposal of the case;

(d) whether any reasonable offer to settle is made by a party and unreasonably refused by the other party; and

(e) whether the party had made a frivolous claim and instituted a vexatious proceeding wasting the time of the Court.

(4) The orders which the Court may make under this provision include an order that a party must pay——

(a) a proportion of another party’s costs;

(b) a stated amount in reSpect of another party’s costs;

(c) costs from or until a certain date ;

((1) costs incurred before proceedings have begun;

(e) costs relating to particular steps taken in the proceedings;

(0 costs relating to a distinct part of the proceedings; and (g) interest on costs from or until a certain date.

3. in section 35A of the Code, sub-section (2) shall be omitted.

4. In the First Schedule to the Code,—

(A) in the Order V, in Rule 1, in sub-rule (1), for the second proviso, the following proviso shall be substituted, namely:-—— '

“Provided further that where the defendant fails to file the . written statement within the said period of thirty days, he shall be allowed to file the written statement on such other day, as may be- specified by the Court, for reasons to be recorded in writing and on payment of such costs as the Court deems fit, but which shall not be later than one hundred twenty days from the date of service of summons. On expiry of one hundred twenty days from the date of service of summons; the defendant shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record”;

(B) in Order VI,—- (i) after Rule 3, the following Rule shall be inserted, namely:—

“3A. Forms of pleading in Commercial Courts —‘ In a Commercial Dispute, where forms of pleadings - have been prescribed under the High Court Rules or Practice Directions made for the purposes of such commercial disputes, pleadings shall be in such forms”;

(ii) after Rule 15, the following Rule shall be inserted, namely:-

“15A. Verification of pleadings in a Commercial Dispute.-

(1) Notwithstanding anything contained in Rule 15, every pleading in a Commercial Dispute shall be verified by an affidavit in the manner and form prescribed in the Appendix to this Schedule. _ -

(2) An affidavit under sub-rule (1) above shall be signed by the . party or by one of the parties to the proceedings, or by any other person on behalf of such party or parties who is proved to the satisfaction of the Court to be acquainted with the facts of the case and who is duly authorised by such party or parties.

(3) \Vhere a pleading is amended, the amendments must be verified in the form and manner referred to in sub-rule (1) unless the Court orders otherwise.

(4) Where a pleading is not verified in the manner provided under sub-rule (1), the party shall not be permitted to rely on such pleading as evidence or any of the matters set out therein.

(5) The Court may strike out a pleading which is not verified by a Statement of Truth, namely, the affidavit set out in the Appendix to this Schedule”;

(C) in Order VII, after Rule 2, the following Rule shall be inserted, namely: -—

“2A. Where interest is sought in the suit.-

(1) Where the plaintiff seeks interest, the plaint shall contain a statement to that effect along with the details set out under sub-

rules (2) and (3).

(2) Where the plaintiffs seeks interest, the plaint shall state whether

the plaintiff is seeking interest in relation to a commercial

transaction within the meaning of section 34 of the Code of Civil

Procedure, 1908 and, furthermore, if the plaintiff is doing so under the terms of a contract or under an Act, in which case the Act is to be specified in the plaint; or on some other basis and shall state the basis of that.

(3) Pleadings shall also state-

(a) the rate at which interest is claimed; (b) the date from which it is claimed; (c) the date to which it is calculated;

(d) the total amount of interest. claimed to the date of calculation; and

(e) the daily rate at which interest accrues after that date”;

(D) in Order VIII,—.

(i) in Rule 1, for the proviso, the following proviso shall be substituted, namely:——~

“Provided that where the defendant fails to file the written statement within the said period of thirty days, he shall be allowed to file the written statement on such other day, as may be specified by the Court, for reasons to be recorded in writing and on payment of such costs as the Court deems fit, but which shall not be later than one hundred twenty days from the date of service of . summons. On expiry of one hundred twenty days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record)”;
(ii) after Rule 3, the following Rule shall be inserted, namely:—-—

“3A. Denial by the defendant in suits before the Commercial Division of the High Court or the Commercial Court.

(1) Denial shall be in the manner provided in sub-rules (2), (3), (4) and (5) of this Rule.

(2) The defendant in his written statement shall state which of the allegations in the particulars of plaint he denies, which allegations he is unable to admit or deny, but which he requires the plaintiff to prove, and which allegations he adrnits.

(.3) 'Where the defendant denies an allegation of fact in a plaint,_he must state his reasons for doing so and if he intends to put forward a different version of events from that given by the plaintiff, he must state his own version.

(4) if the defendant disputes the jurisdiction of the Court he must state the reasons for doing so, and if he is able, give his own statement as to which Court ought to have jurisdiction.

(5) If the defendant disputes the plaintiff’s valuation- of the suit, he must state his reasons for doing so,and if he is able, give his own statement of the value of the suit." ;

(iii) in Rule 5, in sub-rule (1), after the first proviso, the following proviso shall be inserted, namely: -—-

“Provided further, that every allegation of fact in the plaint, if not denied in the manner provided under Rule 3A of this Order, shall be taken to be admitted. except as against a person under disability.” ; '

(iv) in Rule 10, after the first proviso, the following proviso shall be inserted, namely: -—

“Provided further that no Court shall make an order to extend the time provided under Rule 1 of this Order for filing of the written

statement”;

(B) for Order XI of the Code, the following Order shall be substituted, namely:—

. “ORDER XI DISCLOSURE, DISCOVERY AND INSPECTION OF DOCUMENTS IN SUITS BEFORE THE COMMERCIAL DIVISION OF A HIGH COURT OR

A COMMERCIAL COURT

1.(l) Plaintiff shall file a list of all docur‘nents and photocopies of all documents, in its power, possession, control or custody, pertaining to the suit, along with the plaint, including:

I (a) Documents referred to and relied on by the plaintiff in the

plaint;

(b) Documents relating to any matter in question in 'the proceedings, in the power, possession, control or custody of the plaintiff, as on the date of filing the plaint, irrespective of whether the same is in support of or adverse to the plaintiff‘s case;

(c) nothing in this Rule shall apply to documents produced by plaintiffs and relevant only——

Amendments to the Arbitration and Conciliation Bill, 2015

The salient features of the amendments

(i). In order to ensure neutrality of arbitrators, it is proposed to amend Section 12 to the effect that when a person is approached in connection with possible appointment of arbitrator, he shall disclose in writing about existence of any relationship or interest of any kind, which is likely to give rise to justifiable doubts. Further, if a person is having specified relationship, he shall be ineligible to be appointed as an arbitrator.

(ii). Insertion of a new provision that the Arbitral Tribunal shall make its award within a period of 12 months. Parties may extend such period up to six months. Thereafter, it can only be extended by the Court, on sufficient cause. The Court while extending the period may also order reduction of fees of arbitrator(s) not exceeding five percent for each month of delay, if the court finds that the proceedings have been delayed for reasons attributable to the arbitral tribunal. If the award is made within a period of six months, arbitrator may get additional fees if the parties may agree.

(iii). It is proposed to insert a provision for fast track procedure for conducting arbitration. Parties to the dispute may agree that their dispute be resolved through fast track procedure. Award in such cases shall be given in six months period.

(iv). Amendment of Section 34 relating to grounds for challenge of an arbitral award, to restrict the term ‘Public Policy of India” (as a ground for challenging the award) by explaining that only where making of award was induced or affected by fraud or corruption, or it is in contravention with the fundamental policy of Indian Law or is in conflict with the most basic notions of morality or justice, the award shall be treated as against the Public Policy of India.

(v). A new provision to provide that application to challenge the award is to be disposed of by the Court within one year.

(vi). Amendment to Section 36 to the effect that mere filing of an application for challenging the award would not automatically stay execution of the award. Award can only be stayed where the Court passed any specific order on an application filed by the party.

(vii). A new sub-section in Section 11 to be added to the effect that an application for appointment of an Arbitrator shall be disposed of by the High Court or Supreme Court as expeditiously as possible and an endeavour should be made to dispose of the matter within 60 days.

(viii). A new Section 31A is to be added for providing comprehensive provisions for costs regime. It is applicable both to arbitrators as well as related litigation in Court. It will avoid frivolous and meritless litigation/arbitration.

(ix). Section 17 is to be amended for empowering the Arbitral tribunal to grant all kinds of interim measures which the Court is empowered to grant, under Section 9 and such order shall be ‘enforceable in the same manner as if it is an order of Court.

Apart from above, amendments in Sections 2(1)(e) , 2(1)(f)(iii), 7(4)(b), 8(1) and (2), 9, 11, 14(1), 23, 24, 25, 28(3), 31(7)(b), 34 (2A) 37, 48, 56 and in Section 57 are also proposed for making the arbitration process more effective.

Background:-

The Government of India has under its consideration proposals for making Arbitration a preferred mode for settlement of commercial disputes by making it more user-friendly and cost effective. This will lead to expeditious disposal of cases. The Govt. of India is committed to improve its legal framework relating to Arbitration. The Law Commission of India in its 246th Report has recommended various amendments in the Arbitration and Conciliation Act, 1996, so that India may become a hub of International Commercial Arbitration. The Law Commission has also submitted a Supplementary to Report No. 246 on “Amendments to the Arbitration Act, 1996 on ‘Public Policy’- Developments post Report 246″, wherein the Law Commission taking into account subsequent decisions of the Supreme Court has recommended reformulation of amendment in Section 34(2)(b) of the Act.

Chapter 6 , CHAPTER-VI AMENDMENTS TO THE PROVISIONS OF THE CODE OF CIVIL PROCEDURE, 1908 , 2015 Amendments in CPC

' CHAPTER-VI AMENDMENTS TO THE PROVISIONS OF THE CODE OF CIVIL PROCEDURE, 1908

16. (l) The provisions of the Code of Civil Procedure, 1908 shall, in their application to any suit in respect of a commercial dispute of a Specified Value, stand amended in the manner as specified in the Schedule.

4. ( 1) In all High Courts, having ordinary civil jurisdiction, the Chief Justice of' the High Court may, by order, constitute Commercial Division having one or more Benches consisting of a single Judge for the purpose of exercising the jurisdiction and powers conferred on it under this Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing With commercial disputes to be judges of the Commercial Diversion.

5. (1) After issuing notification under sub-section (1) of section 3 or order under sub-section (1) of section 4, the Chief Justice of the concerned High Court shall, by order, constitute Commercial Appellate Division having one or more Division Benches for the purpose of exercising the jurisdiction and powers conferred on it by the Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing with

commercial disputes to be judges of the Commercial Appellate Division. '

6. The Commercial Court shall have jurisdiction to try all suits and applications relating to a commercial dispute of a Specified Value arising out of the entire territory of the State over which it has been vested territorial jurisdiction ‘

Explanation—For the purposes of this section, a commercial dispute shall be considered to arise out- of the entire territory of the State over which a Commercial Court has been vested jurisdiction, if the suit or application relating-to such commercial dispute has ,been instituted as per the provisions of sections 16 to 20 of the Code of Civil Procedure, 1908. '

7. All suits and applications relating to commercial disputes of a Specified Value filed in a High Court having ordinary original civil jurisdiction shall be heard and disposed of by the Commercial Division of that High Court:

Provided that all suits and applications relating to commercial disputes, stipulated by an Act to lie in a court not inferior to‘ a' District Court, and filed on the original side of the High Court,

' shall be heard and disposed of by the Commercial Division of the High Court:
(2) The Commercial Division and Commercial Court shall follow the provisions of the Code of Civil Procedure, 1908, as amended by this Ordinance, in the trial of a suit in respect of a commercial dispute of a Specified Value.

(3) Where any provision of any Rule of the jurisdictional High Court or any amendment to the Code of Civil Procedure, 1908, by the State Government is in conflict with the provisions of the Code of Civil Procedure, 1908, as amended by this Ordinance, the provisions of the Code of Civil procedure as amended by this Ordinance shall prevail.

Chapter 7, The commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

CHAPTER VII

MISCELLANEOUS

17. The statistical data regarding the number of suits, applications, appeals or writ petitions filed before the Commercial Court, Commercial Division, or Commercial Appellate Division, as the case may be, the pendency of such cases, the status of each case, and the number of cases disposed of, shall be maintained and updated every month by each Commercial Court, Commercial Division, Commercial Appellate Division and shall be published on the website of the relevant High Court.

18. The High Court may, by notilication, issue practice directions to supplement the provisions of Chapter II or the Code of Civil Procedure, 1908 in so far as such provisions apply to the hearing of commercial disputes of a Specified Value.

19. The State Government shall provide necessary infrastructure to facilitate the working of a Commercial Court or a

Commercial Division of a High Court.

20. The State Government may, in. consultation with the High Court, establish necessary facilities providing for training of Judges who may be appointed to the Commercial Court, Commercial Division or the Conunercial Appellate Division in a High Court.

21. Save as otherwise provided, the provisions of this Ordinance 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 Ordinance.

22. (1) If any difficulty arises in giving effect to the provisions of this Ordinance, the Central . Government may, by order published in the Otiicial Gazette, make such provisions, not inconsistent with the provisions of this Ordinance as may appear to

it to be necessary or expedient for removing the difficulty:

Provided that no such order shall be made under this section after the expiry of a period of two years from the date of commencement of this Ordinance. '

(2) Every order made under this section shall. be laid, as soon as may be, after it is made, before each House of Parliament.

Chapter 4, The commercial Courts, commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

CHAPTER IV

 APPEALS

13. (1) Any person aggrieved by the decision of the Commercial Court or Commercial Division of'a High Court may appeal to the Commercial Appellate Division of that High Court within a period of sixty days from the date of judgment or order, as the case may be:

Provided that an appeal shall lie from such orders passed by a Commercial Division or a Commercial Court that are specifically enumerated under Order XLIII of the Code of Civil Procedure, 1908 as amended by this Ordinance and section 37 of the s Arbitration and Conciliation Act, 1996.

(2) Notwithstanding anything contained in any other law for the time being in force or Letters Patent of a High Court, no appeal shall lie from any order or decree of a Commercial Division pr Commercial Court otherwise than in accordance with due provisions of this Ordinance.

dispose of appeals iiled before it within a period of six months

14. The Commercial Appellate Division shall endeavour to ‘ from the date of filing of such appeal.

CHAPTER V TRANSFER OF PENDING SUITS

15. (I) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996, relating to a  commercial dispute of Speciiied Value pending in a High Court where a Commercial Division has been constituted, shall be transferred to the Commercial Division.
Chief Justice of the High COurt appoint one or more persons having experience in dealing with commercial diSputes to be the Judge or Judges, of a Commercial Court, from amongst the cadre of Higher Judicial Service in the State.

4. ( 1) In all High Courts, having ordinary civil jurisdiction, the Chief Justice of' the High Court may, by order, constitute Commercial Division having one or more Benches consisting of a single Judge for the purpose of exercising the jurisdiction and powers conferred on it under this Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing With commercial disputes to be judges of the Commercial Dwrsion.

5. (1) After issuing notification under sub-section (1) of section 3 or order under sub-section (1) of section 4, the Chief Justice of the concerned High Court shall, by order, constitute Commercial Appellate Division having one or more Division Benches for the purpose of exercising the jurisdiction and powers conferred on it by the Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing with

commercial disputes to be judges of the Corrimcrcial Appellate Division. '

6. The Commercial Court shall have jurisdiction to try all suits and applications relating to a commercial dispute of a Specified Valuearising out of the entire territory of the State over which it has been vested territorial jurisdiction ‘

Explanation—For the purposes of this section, a commercial dispute shall be considered to arise out- of the entire territory of the State over which a Commercial Court has been vested jurisdiction, if the suit or application relating-to such commercial dispute has ,been instituted as per the provisions of sections 16 to 20 of the Code of Civil Procedure, 1908. '

7. All suits and applications relating to commercial disputes of a Specified Value filed in a High Court having ordinary original civil jurisdiction shall be heard and diSposed of by the Commercial Division of that High Court:

Provided that all suits and applications relating to commercial disputes, stipulated by an Act to lie in a court not inferior to‘ a' District Court, and filed on the original side of the High Court,

' shall be heard and disposed of by the Commercial Division of the High Court:

Chapter 3, The commercial Courts, commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

CHAPTER III SPECIFIED VALUE

12. (l) 'The Specified Value-of the subject matter of the commercial dispute in a suit, appeal or application shall be determined in the following manner:—.

(a) where the relief sought in a suit or application is for recovery of money, the money sought to be recovered in the suit or application inclusive of interest, if any, computed up to the date of filing of the suit or application, as the case may be, shall be taken into account for determining such Specified Value; ~

(b) where the relief sought in a suit, appeal or application ' relates to movable property or to a right therein, the market value of the movable property as on the date of filing of the suit, appeal or application, as the case may he, shall be taken into account for determining such Specified Value;

(c) where the relief sought in a suit, appeal or application relates to immovable property or to a right therein, the market value of the immovable property, as on the date of filing of the suit, appeal or application, as the case may be, shall be taken into account for determining Specified Value;

(d) where the relief sought in a suit, appeal or application relates to any other intangible right, the market value of the said rights as estimated by the plaintiff shall be taken into account for determining Specified Value; and -

(e) where the counter claim is raised in any suit, appeal or application, the value of the subject matter of the commercial dispute in such counter-claim as on the date of the counter- claim shall be taken into account.

(2) The aggregate value of the claim. and counter-claim, if any, as set out in the statement of claim and the counter-claim, if any, in an arbitration of a commercial dispute shall be the basis for determining whether such arbitration is subject to the jurisdiction of a Commercial Division, Commercial Appellate Division or ‘ Commercial Court, as the case may be; .' -. '

(3) No appeal or civil revision application under section 115 of the Code of Civil Procedure, 1908, as the case may be, shall lie from an order of a Commercial Division or Commercial Court finding that it has jurisdiction to hear a commercial dispute under this Ordinance.

The commercial Courts, commercial Division and Commercial Appellate Division of High Courts Ordinance,2015

CHAPTER 1

PRELIMINARY

 
(1) This Ordinance may be called the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015.

(2) It extends to the whole of India, except the State of Jammu and Kashmir.

(3) It shall come into force at once.

2. (1) In this Ordinance, unless the context otherwise requires,—

(a) “Commercial Appellate Division” .means the . Commercial Appellate Division in a High constituted under sub-section (1) of section 5; ~ '

(b) “Commercial Court” means the Commercial Court constituted under sub-section (l)‘of Section 3;

(c) “commercial dispute” means a dispute arising out of—

(i) ordinary transactions of merchants, bankers, financiers and traders such as those relating to mercantile documents, including enforcement and interpretation of such documents;

(ii) export or import of merchandise or services;

(iii) issues relating to admiralty and maritime law;

(iv) transactions relating to aircrah, aircraft engines,aircraft equipment and helicopters, including sales, leasing- and financing of the same;

(v) carriage of goods;

(vi) construction and infrastructure contracts, including tenders;

' (vii) agreements relating to immovable property used exclusively in trade or commerce; '

(viii) franchising agreements; (ix) distribution and licensing agreements;

(x) management and consultancy agreements;

(Xi) joint venture agreements; (Xii) shareholders agreements; .

(xiii) subscription and investment agreements pertaining to the services industry including outsourcing services and financial services;

(xiv) mercantile agency and mercantile usage; (xv) partnership agreements; (xvi) technology development agreements;

(xvii) intellectual property rights relating to registered and unregistered trademarks, copyright, patent, design, domain names, geographical indications and semiconductor integrated circuits;

(xviii) agreements for sale of goods or provision of services;

(xix) exploitation of oil and gas reserves or other natural resources including electromagnetic spectrum;

(xx) insmance and re-insurance;

(xxi) contracts of agency relating to any of the above; and ‘

'(xxii) such other commercial disputes as may be notified by the Central Government.

Explanation—A commercial dispute shall not cease to be a commercial dispute merely because—-

(a) it also involves action for recovery of immovable property or for realisation of monies out of immovable property given as security or involves any. other relief pertaining to immovable property;

(b) one of the contracting parties is the State or any of its agencies or instrumentalities, or a private body carrying out public functions;

(d) “Commercial Division” means the Commercial . Division in a High Court constituted under sub-section (l) of section 4;
(e) “District Judge" shall have the same meaning as assigned to it in clause (a) of article 236 .of the Constitution of India;

(f) “document” means any matter expressed or described upon any substance by means of letters, figures or marks, or electronic means, or by more than one of those means,

intended to be used, or which may be used, for the purpose of recording that matter;

(g) “notification” means a notification published in the Official Gazette and the expression “notify” with its cognate meanings and grammatical variations shall be construed accordingly;

(h) “Schedule” means the Schedule appended to the Ordinance; and

(i) “Specified'Value”, in relation to a commercial dispute, shall mean the value of the subject matter in reSpect of a suit

' as determined in accordance with section 12 which shall not be less than one crore rupees or such higher value, as may be notified by the Central Government".

(2) The words and expressions used and not defined in this Ordinance but defined in the Code of Civil Procedure, 1908 and the Evidence Act, 1872, shall have the same meanings respectively assigned to them in that Code and the Act.

Constitution of Commercial Courts Chapter 2

CHAPTER II

CONSTITUTION of COMMERCIAL COURTS, COMMERCIAL DIVISIONS AND COMMERCIAL APPELLATE DIVISIONS

3. ( 1) The State Government, may after consultation with the concerned High Court, by notification, constitute such number of Commercial Courts at District level, as it may deem necessary for the purpose of exercising the jurisdiction and powers conferred on those Courts under this Ordinance:

Provided that no Commercial Court shall be constituted for the territory over which the High Court has ordinary original civil jurisdiction. / ' '

(2) The State Government shall, after consultation. with the concerned High Court specify, by notification, the local limits of the area to which the jurisdiction of a Commercial Court shall extend and may, from time to time, increase, reduce or alter such

limits.

(3) The State Government shall, with the concurrence of the Chief Justice of the High Court appoint one or more persons having experience in dealing with commercial disputes to be the Judge or Judges, of a Commercial Court, from amongst the cadre of Higher Judicial Service in the State.

Chief Justice of the High Court appoint one or more persons having experience in dealing with commercial disputes to be the Judge or Judges, of a Commercial Court, from amongst the cadre of Higher Judicial Service in the State.

4. ( 1) In all High Courts, having ordinary civil jurisdiction, the Chief Justice of' the High Court may, by order, constitute Commercial Division having one or more Benches consisting of a single Judge for the purpose of exercising the jurisdiction and powers conferred on it under this Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing With commercial disputes to be judges of the Commercial Division.

5. (1) After issuing notification under sub-section (1) of section 3 or order under sub-section (1) of section 4, the Chief Justice of the concerned High Court shall, by order, constitute Commercial Appellate Division having one or more Division Benches for the purpose of exercising the jurisdiction and powers conferred on it by the Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing with

commercial disputes to be judges of the Commercial Appellate Division. '

6. The Commercial Court shall have jurisdiction to try all suits and applications relating to a commercial dispute of a Specified Value arising out of the entire territory of the State over which it has been vested territorial jurisdiction ‘

Explanation—For the purposes of this section, a commercial dispute shall be considered to arise out- of the entire territory of the State over which a Commercial Court has been vested jurisdiction, if the suit or application relating-to such commercial dispute has ,been instituted as per the provisions of sections 16 to 20 of the Code of Civil Procedure, 1908. '

7. All suits and applications relating to commercial disputes of a Specified Value filed in a High Court having ordinary original civil jurisdiction shall be heard and disposed of by the Commercial Division of that High Court:

Provided that all suits and applications relating to commercial disputes, stipulated by an Act to lie in a court not inferior to‘ a' District Court, and filed on the original side of the High Court,

' shall be heard and disposed of by the Commercial Division of the High Court:

Provided further that all suits and applications transferred to -_ the High Court by virtue of sub-section (4) of section 22 of the Designs Act, 2000 or section 104 of the Patents Act, 1970 shall be heard and disposed of by the Commercial Division of the High Court in all the areas over which the High Court exercises ordinary original civil jurisdiction.
8. Notwithstanding anything contained in any other law for the time being in force, no civil revision application or petition shall be'entertained against any interlocutory order of a Commercial Court, including an order on the issue of jurisdiction, and any such challenge, subject to the provisions of section 13, shall be raised only in an appeal against the decree of the Commercial Court.
9. (1) Notwithstanding anything contained in the Code of Civil Procedure, 1908, in the event that a counter-claim tiled in a suit before a civil court relating to a commercial dispute is of Specified Value, such suit shall be transferred by the civil court to the Commercial Division or Commercial Court, as the case may be, having territorial jurisdiction over such suit. (2) In the event that such suit is not transferred in the manner contemplated in sub—section (1), the Commercial Appellate Division of the High Court exercising supervisory jurisdiction over the civil court in question may, on the application-of any of the parties to the suit, withdraw such suit pending before the civil court and transfer the same for trial or disposal to the Commercial Court or Commercial Division or, as the case may be, having territorial jurisdiction over such suit, and such order of transfer shall be final and binding.
10. Where the subject matter of an arbitration is a commercial dispute of a Specified Value and—-
(1) If such arbitration is an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that have been filed in a High Court, shall be heard and disposed of by the Commercial Appellate Division where such Commercial Appellate Division has been constituted'in such High Court.
(2) If such arbitration is other than an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that have been filed on the original side of the High Court, shall be heard and disposed of by the Commercial Appellate Division where such Commercial Appellate Division has been constituted in such High Court.
(3) if such arbitration is other than an international commercial arbitration, all applications or appeals arising out of such arbitration under the provisions of the Arbitration and Conciliation Act, 1996 that would ordinarily lie before any principal civil court of original jurisdiction in a district (not being a High Court) shall be tiled in, and heard and disposed of by the Commercial Court exercising territorial jurisdiction over such arbitration where such Commercial Court has been constituted. '

11. Notwithstanding anything contained in this Ordinance, a ‘ Commercial Court or a Commercial Division shall not entertain or  decide any suit, application or proceedings relating to any ‘ commercial dispute in respect of which the jurisdiction of the civil court is either expressly or impliedly barred under any other law

for the time being in force.

Constitution of commercial Division of High Court

4. ( 1) In all High Courts, having ordinary civil jurisdiction, the Chief Justice of' the High Court may, by order, constitute Commercial Division having one or more Benches consisting of a single Judge for the purpose of exercising the jurisdiction and powers conferred on it under this Ordinance.

(2) The Chief Justice of the High Court shall nominate such judges of the High Court who have experience in dealing With commercial disputes to be judges of the Commercial Dwrsion.