Summary Judgements (Commercial Courts Act, 2015)

Summary Judgements (Commercial Courts Act, 2015)

Summary Judgement is an outcome where the case is decided summarily with the help of documentary evidence. Commercial Courts Act, 2015 was enacted to ensure that there is smooth operation of business and trade in the country. It has eased the procedures involved in commercial litigation. Through Commercial Courts Act, 2015 the regime of summary judgement was introduced.

It was in 188th report of the Law Commission where the need of fast track method (Commercial Courts) of resolving the commercial dispute was expressed. In the 253rd report of the Law Commission, the Commission expressed that the process of summary judgement should be introduced for resolution of commercial disputes in an expedient manner. The objective of summary judgements was to avoid going into unnecessary trials.

In accordance to section 16 of the Commercial Courts Act, 2015, there are certain provisions that stand amended so that the provisions can be applicable to the Commercial Disputes in the court of law. Such judgements can be given only in commercial disputes. Under order XIII–A of the Code of Civil Procedure the summary judgements are detailed.

Also Read: The Commercial courts act, 2015: A Systematized Transaction and Court

In such cases the claims of the commercial disputes are usually decided without recording the oral evidence on the application made by either of the party.[1] The claim in such cases could be a whole claim, part of it or any question arising out of such claim or a counterclaim.[2] The application made under this order shall not be applicable to or can be made in case of commercial cases filed under order XXXVII.[3]

The application can be made after the summons have been served on the defendant and before the framing of charges in the suit.[4] Usually a summary judgement is passed by a court where it finds out that either of the parties to the dispute have no prospects of justifying/ defending their claim and there is no compelling reason to continue with the proceedings.[5] The objective of the order XIII–A to avoid getting into prolonged proceedings in a suit. The application is usually heard before the framing of the issues.

The application is usually filed in Intellectual Property Rights disputes, however its fullest potential in commercial regime is yet to unfold. The application made under this order must contain – that it is for the purpose of summary judgement, the material facts, law, evidence in documentary form, reason for unsuccessful claim of the party, relief sought etc.[6] The response to the notice to such application is made by the respondent within 30 days of the receipt of the notice.[7]

“The court can, after the application is made- dismiss the application, dismiss the claim, strike out the pleadings.”[8] While passing such an order, the court is bound to give a speaking order.

Court can also pass a conditional order under rule 6(1)(b) where there is a possibility that the claim made by either of the party may succeed. Here the party can be asked to deposit money to the court, carry out direction of the court with respect to the claim or defence and deposit security. It can also detail out the consequences of non- compliance of the conditioned order.

For the grant of summary judgement, the court must be satisfied that there are no issues which are triable in nature. The summary judgements are usually passed in cases where the Defendant fails to appear before the court of law or file his pleadings before the court of law. In such cases instead of proceeding ex- parte, the court may pass a summary judgement.[9] The section 12 of the Commercial Courts Act, 2015 states the specific value[10] of the subject matter of the dispute, which “shall not be less than one crore rupees or such higher value to be notified by the Central Government.”

Summary judgement has been discussed in the case of R Impex v. Punj Lloyd Ltd.[11] in which the Hon’ble Delhi High Court states that the judgement can be passes after issuing of the summons to the defendants and before the framing of the issues. Such a judgement is passed where the prospects of a successful claim or defence are grim.

It was also held in the same case that “the purpose of the proviso to Rule 2 of Order XIII-A is to discourage filing of applications for summary judgment after issues have been framed, thereby delaying trial and to empower the Court to, if finding the same to be dilatory, dismiss the same in limine.” The abovementioned has been reiterated by the Hon’ble Delhi High Court in the cases Jindal Saw Limited Aperam Stainless Services and Solutions Precision SAS[12] and Oxbridge Associates Limited v. Atul Kumar.[13]

In the case of Venezia Bobili India v. Ramprastha Promoters and Developers Private Ltd.[14] the Hon’ble Delhi High Court upheld that usually the case is not triable in nature and the claim can be allowed without entering into oral evidence.

In the case of Bright Enterprises Private Ltd. v. MJ Bizcraft LLP & Anr.[15], it was observed that the proceedings would not happen in absence of filing of the application under order XIII- A. However, the court took an opposite view where the summary judgement was passed without the application and hearing the Defendant. In the case of Sketchers USA Inc v. Pure Play Sports[16], the Hon’ble Delhi High Court passed an interim injunction in favour of Sketchers and against Pure Play for using deceptively similar trademark.

In this case, summary judgement was passed without the application with respect to the same under order XIII–A and without any reply of the same from the Respondent.

The difference between summary judgement and summary suit

The difference between summary judgement and summary suit is that, in case of summary judgement, the relief sought is with respect to a commercial dispute. While on the other hand a summary suit involved the demand of liquidated debt.

The summary judgement may be passed when the merits of the case, rights and liabilities of the parties are well defined and there is no further need to lead any form of evidence.

The utility of the order is that it prevents in the delaying of the proceedings on baseless grounds. In such cases the need of oral evidence is usually ruled out. Summary Judgements are considered to be a viable option with respect to business and commercial disputes. Order 13A is a recent addition through the Commercial Courts Act, which was cleared by the Cabinet and received Presidential assent on October 23, 2015. It is applicable where undergoing proceedings in a matter is considered redundant in nature. It streamlines and ensures the expeditious conclusion of the dispute.

 

 

This article is written by Miss. Reha Chitkara, a BALLB (Hons) graduate from Amity Law School Delhi, Guru Gobind Singh Indraprastha University 

 

[1] Order XIII-A, Rule 1, Code of Civil Procedure, 1908.

[2] Ibid.

[3] Ibid.

[4] Order XIII-A, Rule 2, Code of Civil Procedure, 1908.

[5] Order XIII-A, Rule 3, Code of Civil Procedure, 1908.

[6] Order XIII-A, Rule 4, Code of Civil Procedure, 1908.

[7] Ibid.

[8] Order XIII-A, Rule 6, Code of Civil Procedure, 1908.

[9]Impressario Entertainment and Hospitality Private Limited v. Mocha Blu Coffee Shop, MANU/DE/4042/2018.

[10] Section 2(1)(i), Commercial Courts Act, 2015.

[11] Delhi High Court, CS(Comm) 646/2016.

[12] Delhi High Court, CS(Comm) 1314/2016.

[13]Delhi High Court ,CS(OS)3148/2015.

[14]  2019 SCC OnLine Del 7761.

[15] Delhi High Court ,RFA(OS)(COMM) 8/2016 & CM 37888/2016.

[16]  Delhi High Court, I.A. No.6279/2016.

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