Final Order 2

Order Details: Notice of Motion
Pdf Text: NM No. 3676 /2023
Chittranjan – Midas
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MHCC010106502023
City Civil and Sessions Court, Mazgaon Greater Mumbai
Court Room No. 31 – Commercial Court
Notice of Motion No. 3676 / 2023
in
Commercial Suit No. 109 / 2023
Mandar K. Tiwari … Applicant
(Original Defendant No. 3)
IN THE MATTER BETWEEN
Mr. Chittranjan H. Malakar … Plaintiff
Vs.
1. Midas Construction
2. Awanish Kumar Tiwari
3. Mandar K. Tiwari … Defendants
Appearances :
Defendant No. 3 : Adv. Rajesh Singh
Plaintiff : Adv. Abhaysingh Shinde
CORAM : PRASAD P. KULKARNI
COURT ROOM NO.31.
DATE : 18.07.2025
*************************************************************
ORDER
1. Defendant No. 3 has preferred this Notice of Motion under
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Order 7 Rule 11 of the Code of Civil Procedure, 1908 (the Code, for
short) for rejection of plaint and few other reliefs. Notice of Motion is
supported by an affidavit. Plaintiff filed reply affidavit vide Exh.11.
Defendant submitted written notes of arguments vide Exh.14 and
plaintiff filed written submission vide Exh.15.
Crux of the Notice of Motion is as follows :
2. Plaintiff sued defendants to recover Rs.57,64,161/- with 18%
interest per annum. Initially, Summary Suit under Order XXXVII of the
Code was filed in the year 2018 (Summary Suit No. 238/2018). In
response to summons for appearance, defendants appeared within time.
Thereafter, plaintiff taken out Summons for Judgment No. 317/2018
and it was also served on defendants. Defendants appeared within 10
days and tendered leave to defend.
3. However, defendants moved Exh.6 raising objection that suit
ought to have been registered as Commercial Suit. Plaintiff filed reply to
that application. Exh.6 was heard and disposed of on merit on
02.02.2023. The then Presiding Officer, City Civil Court, Court Room
No. 61 allowed Exh.6 and transferred the matter to Commercial Court.
Consequent upon that order, Summary Suit 238/2018 is re-registered
as Commercial Suit No. 109/2023.
4. On this backdrop, defendant no. 3 has raised following
objections :
(1) Plaintiff has not followed mandate of Pre Institution
Mediation as required under Section 12-A of the
Commercial Courts Act (C.C. Act, for short). Hence, suit/
plaint is liable to be rejected under Order 7 Rule 11 of
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the Code.
(2) There could be no Summons for Judgment in
Commercial Suit.
(3) In view of proviso appended to Order 8 Rule 1 of the
Code, defendants are not served with Writ of Summons
after conversion of suit as Commercial Suit. Unless there
is specific date of service of summons, it is difficult to
calculate 120 days within which defendants are
permitted to tender Written Statement on record.
5. Thus, defendant no. 3 prayed that plaint may be rejected for
want of compliance under Section 12-A of the Commercial Courts Act
and for want of cause of action.
6. Plaintiff in reply Exh.11 submits that it is a suit of year 2018
and Summons for Judgment is pending from last many years.
Defendant is intending to rotate Summary Suit into Commercial Suit
and taking disadvantage of Judgment of the Hon’ble Apex Court in the
case of M/s. Patil Automation Pvt. Ltd. Vs. Rakheja Engineers Pvt. Ltd.
reported in AIR 2022 SC 3848, has moved this application. Plaintiff
submits that, ratio laid down in the Judgment of Patil Automation says
that, “
when there is no urgent interim relief then it is not mandatory to
follow Section 12-A of the C.C.Act”. As per plaintiff, defendants have
misconstrued, misunderstood and misconceived ratio laid down in the
Judgment of the Hon’ble Apex Court in the case of M/s. Patil
Automation. Thus, plaintiff prayed that Notice of Motion may be
dismissed.
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7. I have heard Learned Advocate Mr. Rajesh Singh appearing for
defendant no. 3 and perused written notes of arguments Exh.14. I have
heard Learned Advocate Mr. Abhaysingh Shinde appearing for plaintiff
and perused written notes of arguments Exh.15.
8. Advocate for defendants submits that there would no
Summons for Judgment in Commercial Suit. Rather there could be an
application for Summary Judgment under Order 13-A of the Code,
which is applicable to Commercial Dispute. Summons for Judgment
filed by plaintiff itself is untenable. Under Order 8 Rule 1 of the Code in
its application to the Commercial Suit, limitation of 120 days is
provided for defendants to file Written Statement. After conversion of
suit to Commercial Suit, Writ of Summons was not issued and served on
defendants. So, there is no specific date from which limitation period
for filing Written Statement should be counted. He further submits that
after order below Exh.6 Dt. 02.02.2023 and after conversion of suit to
Commercial Suit, plaintiff ought to have taken recourse under Section
12-A of the C. C. Act. As that is not done, plaint should be rejected.
9. Advocate for plaintiff submits that Summons for Judgment is
pending since 2018. Initially, suit was filed under Order XXXVII of the
Code. Judgment relied on by defendants are not applicable to the facts
in hand. Somehow, defendants are creating legal hurdle for hearing of
Summons for Judgment. Hence, Notice of Motion may be rejected.
10. Prior to discussing merits of Notice of Motion, it would be
relevant to refer brief facts, relief claimed in plaint. It is a suit for
recovery of Rs. 57,64,161/- with interest. It is contention of plaintiff
that defendants placed Work Order to plaintiff for construction and
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accordingly plaintiff raised construction. However, abruptly, defendants
prevented plaintiff from carrying out outer finishing work of building
and not paid the amount due. So, on these facts, suit was filed for
recovery of amount.
11. As per Section 2(c) of the C. C. Act, “commercial dispute” is
defined and exhaustive list is provided therein. As per Section 2(c)(vi)
of the C. C. Act, construction and infrastructure contract including
tenders, are also covered under commercial dispute. Keeping in mind
said provision and in view of Section 15 of the C. C. Act, the then
Presiding Officer of Court Room No. 61 has allowed Exh.6 an
application moved by defendants and transferred the suit to
Commercial Court. Nothing is there on record, which can suggest that
plaintiff ever challenged that order. So, that order still hold ground.
12. It is a matter of fact that initially suit was filed under Order
XXXVII of the Code and because of that plaintiff has moved Summons
for Judgment under Order XXXVII Rule 3(4) of the Code. It is also a
matter of fact that Summons for Judgment is still pending.
13. Here, one has to take into consideration different provisions
applicable to Summary Suit filed under Order XXXVII of the Code and
provisions applicable to Commercial Dispute. So far as Order XXXVII of
the Code is concerned, under Order XXXVII Rule 3 of the Code in
Summary Suit, plaintiff has to issue summons for appearance to
defendant and it is obligatory on the part of defendant to appear within
10 days. Thereafter, under Order XXXVII Rule 3(4) of the Code, it is
obligatory on the part of plaintiff to serve defendant with Summons for
Judgment and it is necessary for defendant to appear and tender leave
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to defend within 10 days. When suit was earlier registered as Summary
Suit, defendants appeared within time and they have tendered leave to
defend within time. However, after conversion of suit to Commercial
Suit, this Court is of considered opinion that provision of Order XXXVII
of the Code will not be applicable.
14. When it comes to commercial dispute / suit under Order 13-A
of the Code, there is provision for Summary Judgment. Order 13-A Rule
1 to Rule 8 deals with stage when a party can apply for Summary
Judgment, grounds for Summary Judgment and it also prescribed
procedure for Summary Judgment. Hence, for commercial dispute,
provision of Order 13-A of the Code would be applicable while applying
for Summary Judgment.
15. During argument, Advocate for defendants relied on Judgment
of the Hon’ble Apex Court in the case of R. K. Roja Vs. U. S. Rayudu &
Anr. reported in AIR 2016 SC 3282. I have gone through the Judgment.
While dealing with Order 7 Rule 11 of the Code, Hon’ble Apex Court
observed that Court can not proceed with the trial without disposing of
an application under Order 7 Rule 11 of the Code. Here, in this case
trial has not yet commenced nor this Court is proceeding further
without deciding an application under Order 7 Rule 11 of the Code.
Hence, though the ruling clarify position of law, but not applicable to
the facts in hand as trial is not commenced.
16. Advocate for defendants also relied on Judgment of the
Hon’ble Apex Court in the case of Shipping Corporation of India Ltd. Vs.
Machado Brothers & Ors. reported in AIR 2004 SC 2093. I have gone
through said Judgment wherein Hon’ble Apex Court has discussed
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Section 15 of the Code i.e. inherent powers of Court. In that particular
case, suit was infructuous and hence it was disposed of. Facts of that
case differs from facts in hand. Hence, said ruling is not applicable to
the facts in hand.
17. It is a matter of fact that as per Order 8 Rule 1 of the Code,
defendants can submit Written Statement within 30 days from the date
of service of summons and as per “Section 16 of Act 4 of 2016 in its
application to commercial dispute”, one proviso is included which says
that outer limit to file Written Statement in Commercial Suit is 120
days.
18. Said 120 days are to be counted from the date of service of
summons. On this point, Advocate for defendants relied on Judgment of
the Hon’ble Bombay High Court in the case of Metro Ortem Ltd. Vs.
Maharashtra State Road Transport Corporation reported in AIR Online
2022 BOM 607 and Judgment of Hon’ble Apex Court in the case of M/s.
S.C.G Contracts India Pvt. Ltd. Vs. K.S. Chamankar Infrastructure Pvt.
Ltd. & Ors. reported in AIR Online 2019 SC 361.
19. I have gone through both rulings cited. Dealing with point of
limitation for filing Written Statement in Commercial Suit, it is observed
that it is mandatory to serve summons upon defendants as 120 days are
to be counted from date of service of summons. These authorities clarify
legal position. However, point of service of summons as argued by
defendant no. 3 is not a ground to reject plaint under Order 7 Rule 11
of the Code. Hence, on that count, plaint cannot be rejected.
20. Final limb of submission advanced by Advocate for defendant
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no. 3 was that for non compliance of Section 12-A of the C. C. Act,
plaint may be rejected. Under Order 7 Rule 11 of the Code, plaint shall
be rejected when the suit appears from the statement in the plaint to be
barred by any law. In Notice of Motion, though defendant has raised
point that plaint does not disclose cause of action, but that point has not
been elaborated by defendant no. 3 nor it was even argued before this
Court. So, discussion under Order 7 Rule 11 of the Code will be
restricted only to applicability of compliance of Section 12-A of the C. C.
Act.
21. Initially, suit was filed as Summary Suit in the year 2018. So,
there was no reason for plaintiff to file any application for Pre
Institution Mediation under Section 12-A of the C. C. Act. However,
when order Exh.6 was passed, plaintiff was having an opportunity to go
for Pre Institution Mediation under Section 12-A of the C. C. Act.
22. To substantiate his argument, Advocate for defendant no. 3
relied on Judgment of the Hon’ble Apex Court in the case of M/s. Patil
Automation (supra). This is landmark authority which elaborately
discussed Section 12-A of the Commercial Courts Act and whether it is
mandatory or not and what Court should do if Section 12-A of the C. C.
Act is not followed. In Para no. 84 of said Judgment, Hon’ble Apex
Court clearly observed that Section 12-A of the C. C. Act is mandatory
and any suit instituted violating the mandate of Section 12-A must be
visited with rejection of the plaint under Order 7 Rule 11 of the Code.
23. Hon’ble Apex Court observed that this power can be exercised
suo moto by the Court. So, Judgment in the case of M/s. Patil
Automation is very clear on this point and when it is observed by the
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Hon’ble Apex Court that it is mandatory to follow Section 12-A of the
C.C. Act, then no discretion is left with any Court. Hence, ruling cited is
applicable to the facts in hand. Plaintiff could have gone for Pre
Institution Mediation prior to re registration of suit as Commercial Suit.
24. On aspect of re-registration of suit, plaintiff has relied on
Judgment of Hon’ble Bombay High Court in case of M/s. Ashok
Commercial Enterprises Vs. Rajesh Jugraj Madhani in Writ Petition No.
10573/2022 Dt. 31.01.2023. I have carefully gone through this
Judgment. In that case, plaintiff presented Summary Suit under Order
XXXVII of the Code and it was registered as Commercial Suit. As the
Suit was registered as Commercial Suit, so plaintiff applied for
Summary Judgment under Order 13-A of the Code. Application for
Summary Judgment was turned down by City Civil Court.
25. As application of plaintiff filed under Order 13-A of the Code
was rejected, it was observed that Order XXXVII of the Code would not
apply. In para no. 15 of the Judgment it is observed that purpose of
Order 13-A (1)(3) of the Code is to prevent plaintiff from applying for
Summary Judgment when plaintiff already made an attempt under
Order XXXVII Rule 3 of the Code. Point involved in ruling cited is
completely different than the point which is involved in present Notice
of Motion. Hence, Judgment in the case of M/s. Ashok (supra) is of no
avail to the stand taken by the plaintiff.
26. This Court is conscious of law position that while deciding
application under Order 7 Rule 11 of the Code, only plaint can be gone
through. It is very clear that despite plaintiff was conscious of a fact that
suit would be registered as Commercial Suit had not gone for Pre
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Institution Mediation under Section 12-A of the Act. It appears plaintiff
is labouring under some misconception of law that when there is no
urgent ad-interim relief, it is not necessary to go for Pre Institution
Mediation under Section 12-A of the C. C. Act.
27. In fact, correct legal position as per Judgment in the case of
Patil Automation is that only when some urgent ad-interim relief/s
is/are claimed then only plaintiff can make an exception from mandate
of Section 12-A of the C. C. Act. Other side of the coin is that when
there is no urgent relief in that event it is mandatory for plaintiff to go
for Pre Institution Mediation. As that has not been done, so I find it fit
to reject the plaint under Order 7 Rule 11 of the Code. Hence, I find
substance in the submission made by Advocate for defendant no. 3, only
to the extent of non compliance of Section 12-A of the C. C. Act.
28. Notice of Motion thus succeed. Plaint deserves to be rejected
under Order 7 Rule 11 of the Code. As trial has not commenced, so
plaintiff is entitled to get back the Court Fees, subject to rules and stage
of the proceeding. At the same time, pending interim applications
including Summons for Judgment also deserves to be disposed of as
plaint itself is rejected. Hence, following order is passed :
ORDER
1. Notice of Motion No. 3676 of 2023 is allowed as follows :
2. For non compliance of Section 12-A of the Commercial Courts
Act, 2015 plaint in Commercial Suit No. 109/2023 (Old No.
Summary Civil Suit 238/2018) stands rejected under Order 7
Rule 11 of the Code.
3. Pending interim applications including Summons for
Judgment No. 317/2018 stands disposed of.
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4. Court fees be refunded to plaintiff, as per Rules.
5. Order is dictated and pronounced in Open Court.
6. Record of Notice of Motion No. 3676/2023 and Summons for
Judgment No. 317/2018 shall form part of main Commercial
Suit No. 109 / 2023.
Mumbai
Dated : 18.07.2025
(Prasad P. Kulkarni)
Judge, City Civil & Sessions Court,
Court Room No.31 - Commercial Court,
Mazgaon, Greater Mumbai
Dictated on : 17.07.2025
Transcribed on : 18.07.2025
Signed by HHJ on : 18.07.2025
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CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE TIME NAME OF STENOGRAPHER
18.07.2025 2.10 p.m. Prachi Y. Potdar
Stenographer - Grade I
Name of the Judge HHJ Shri. Prasad. P. Kulkarni
(C.R.NO. 31)
Date of Pronouncement of
Judgment/Order.
18.07.2025
Judgment/order signed by P.O on 18.07.2025
Judgment/order uploaded on 18.07.2025
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