Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance Promulgated in India

The President of India on October 23, 2015 promulgated the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015, No. 8 of 2015. The ordinance aimed towards constitution of Adjudication Authority for speedy disposal of commercial dispute of specified value and matters connected thereto.

Highlights of the Ordinance are as follows:

Commercial Dispute:

Ordinance provides definition of Commercial dispute to include disputes relating to transactions between merchants, bankers, financiers, traders, Intellectual Property Disputes, Contractual disputes related to the commerce, licensing and distribution agreements, partnership agreements, technology development agreement inter alia.

Valuation of Dispute:

Ordinance provides that all matters relating to commercial disputes involving an amount of Rs One Crore or more to be dealt with by commercial divisions in High Courts and Commercial Courts.

Commercial Courts:

Ordinance provides State governments to set up commercial courts, equivalent to district courts, after consulting with their respective high courts. However, a commercial court will not be set up in an area where the high court exercises ordinary original civil jurisdiction.

Commercial Divisions in High Courts:

Ordinance provides Commercial divisions to be set up in those High Courts which exercise ordinary original civil jurisdiction, that is, the High Courts of Delhi, Bombay, Calcutta, Madras and Himachal Pradesh.

Commercial Appellate Divisions:

Ordinance provides Commercial appellate divisions to be set up in all High Courts to hear appeals against:

  • orders of commercial divisions of high courts,
  • orders of commercial courts, and
  • appeals arising from arbitration matters that are filed before the high courts.

Right to Appeal:

Section 13 of the Ordinance provides for Appeal from order of Commercial Court or Commercial Division of High court to Commercial appellate division of that High Court to be filed within 60 days from the date of judgment or order.

Transfer of Pending Suits:

Section 15 of the Ordinance provides for transfer of all suits and application relating to the commercial dispute of specified value pending in High Court or Civil Court in any district to the Commercial Division. However any matter wherein the final judgment has been reserved by the Court prior to the constitution of the Commercial Division or Commercial Court shall not be subject of transfer.

Conclusively, the Ordinance aims towards faster disposal of the Commercial disputes in India and in pursuance to that provide for certain strict timeline for the disposal of the suit. Ordinance provides timeline of less than two years for the procedure to resolve the commercial dispute excluding the time for pleadings, arguments and disposal of the Ordinance further made certain important amendments to Civil Procedure Code in order to meet the aim of speedy disposal of the commercial dispute.

The Ordinance is a very positive move towards the commercial growth of the country which shall definitely change the face of Indian Legal System by rendering speedy disposal of the commercial disputes which shall ultimately help to reduce the high Pendency of the litigation matters in India.

The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015, No. 8 of 2015 can be accessed here.

About the Author: Mr. Abhijeet Deshmukh, Trade Mark Attorney, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: Abhijeet@khuranaandkhurana.com

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