Article by Jagadeesh A, Advocate Ph:-9449847222

Before passing Commercial Court Act 2015 by the central government all litigation to be settled in Civil Court. The Civil Court will take its own time to dispose the case because of the adjournment, objections, Appeal against the orders will take lot of time and instances the case is decided even after 10-15 years.

The Civil Court is over burden and speedy trial and disposal will be a myth and foreign Investors are not willing to invest in India they are hesitating to invest in India due to the hurdle and time consuming process and process to resolving business litigation.

In the business people are not interested in continuing litigation for unlimited period this will hamper business. The Government of India has thought and ease of quick and easy disposal of disputes in Commercial Transaction where it involve complex facts and question of law the government has brought a separate Act and this Act is called The Commercial Court Courts Act 2015 and was promulgated on 23rd October, 2015 to resolve quick and easily resolve Commercial dispute between the parties with a fixed time frame.

And, with certain changes, This Act was amended in the year 2018 and "The Commercial Courts, Commercial Division and commercial Appellate Division of High Courts (Amendment Act 2018)" came to effect.

For approaching the commercial courts the nature of transaction should be commercial in nature. Section 2 (c) will explains only certain commercial nature of transactions between the parties will be admitted in the Commercial Court

The following are the dispute arising out of the following commercial transaction will be admitted in commercial court.

The transactions of merchants, bankers , financiers and traders, the transactions relating to export or import of merchandise or services, and admiralty and maritime law, aircraft , aircraft engines, aircraft equipment and helicopters and includes sales, leasing and financing , Carriage of Goods, Infrastructure Contracts including tenders, Immovable property exclusively used in trade or commerce, Franchising and distribution and licensing agreements , Management and consultancy, joint venture and shareholders agreements, subscription and investment agreements pertaining to service industry which includes outsourcing services and financial services, mercantile agency , partnership and technology development, intellectual property rights, sale of goods and provision of services, extraction of oil and gas reserves, insurance and reinsurance, Agency contract of the above. Any other commercial disputes central Government may notify.


'The Commercial Court' will not admit the suit unless the plaintiff exhausts the remedy of pre institution mediation in accordance with such manner and procedure as prescribed by rules made by the Union Government. Any urgent matter where interim relief to obtained due to emergency the plaintiff can approach Commercial Court for urgent relief.

Union Government has issued the notification to constitute pre institution Mediation Authorities under the Legal Services Authorities Act 1987 (39 of 1987).

Any dispute referred to District Service Legal Authority has to complete the mediation within a period of 3 months from the date of application made by the plaintiff under sub section 2 mediation may be extended for a period of another 2 months with the consent of the both parties.

If the settlement occurs between parties in the commercial dispute the same shall be reduced into writing and shall be signed by the parties to the dispute and the mediator.

The settlement arrived between the parties under this section shall have the same status and effect as if it is an arbitral award on agreed terms under sub-section (4) of section 30 of the Arbitration and Conciliation Act, 1996 (26 of 1996).]

Commercial Court does not entertain the suit directly unless it does not contemplate any urgent interim relief under this Act. The Aggrieved party has to go to District Service Legal Authority Services Authority for pre mediation. Here both the parties will come with mutual concusses and resolve the dispute with in short period of time without approaching the court. In the mediation through dialogue, with mutual coordination in a healthy atmosphere will resolve the commercial disputes between themselves within themselves.

The process is very simple the aggrieved party has to fill mediation application form (See Rule 3 (1) which contain Name, Address and Contact details of applicant including Phone number and Email Id , Name of the opposite party, Address Phone Number and Email id and has to give short description and give details of dispute , quantum of claim and territorial jurisdiction of commercial court and brief synopsis of commercial dispute not exceeding 5000 words

The applicant has to deposit Rs.1,000- in the form of Demand Draft or Online transfer to be made in favor of DLSA. 

 This application along with Index, Vakalath Nama, process and PF to be paid. The DLSA issue notice to the opposite party via registered post and sent through Email ID also. Fix the date of mediation. if the opposite party has appeared before the mediation center and mediation will start. If both the parties accepted the mediation they have to pay the mediation fee as below payable by plaintiff and defendant.

S.No Disputed Claim Money                         Mediation Fee Payable To Authority (in INR).

1.     From Rs. 3,00,000 to Rs.10,00,000.         -    Rs. 15,000/-

2.     From Rs. 10,00,000. to Rs. 50,00,000.     -    Rs. 30,000/-

3.     From Rs. 50,00,000. to Rs. 1,00,00,000.  -    Rs. 40,000/-

4.     From Rs.1,00,00,000. to Rs.3,00,00,000.  -    Rs. 50,000/-

5.     Above Rs. 3,00,00,000                               -    Rs.75000/-

If the opposite party has not responded once again the DLSA will send the RPAD notice. And if the opposite party is not appeared the DLSA will issue Non Starter Report in form No.3 after the receipt of Non Starter Report and this will a part of plaint to admit in the Commercial Court.

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