[S.12A Commercial Courts Act] Court Can Inquire Whether "Urgent Interim Relief" Is Genuine Or Aimed To Bypass Pre-Institution Mediation: Calcutta HC
The Calcutta High Court on Friday ruled that under Section 12A of the Commercial Courts Act, 2015, there are no statutory impediments upon the Court to apply its mind and enquire into whether the circumstances for grant of urgent interim relief has been made out by the plaintiff through pleadings. The Division Bench of Justices Harish Tandon & Prasenjit Biswas observed that the...
The Calcutta High Court on Friday ruled that under Section 12A of the Commercial Courts Act, 2015, there are no statutory impediments upon the Court to apply its mind and enquire into whether the circumstances for grant of urgent interim relief has been made out by the plaintiff through pleadings.
The Division Bench of Justices Harish Tandon & Prasenjit Biswas observed that the provision is silent in this regard. However, 'urgent interim relief' is an expression of wide import and difficult to give exhaustive meaning. Therefore, Court can undertake an exercise to find out whether it actually involves any urgent interim reliefs.
"Any other Course adopted by the Court would give a free handle to an unscrupulous plaintiff to override the mandatory provision of Section 12A by incorporating a relief which cannot be said to be an urgent interim reliefs nor the facts and circumstances or the cause of action pleaded in the plaint entitles the plaintiff to such relief on a bare reading of the averments made in the plaint. Often an application for urgent interim reliefs are filed in the suit and ultimately if the Court may not find any justification in passing such interim relief yet it would sub-serve the motive and the purpose of avoiding the pre-institution mediation as mandated under Section 12A of the Code."
Court said that if it is found that the case does not involve an urgent interim relief, it can reject the plaint and direct the plaintiff to exhaust the remedy under Section 12A of the Act.
The Court placed reliance on Delhi High Court's decision in Chandra Kishore Chaurasia v.. R. A. Perfumery Works Pvt., where it was held that question as to whether a suit involves any urgent interim relief is to be determined solely on the basis of the pleadings and relief as sought by the plaintiff.
The instant proceedings arose out of an appeal preferred in respect of a suit filed before the Commercial Division of the Court without exhausting pre-institution mediation under Section 12A of the Act along with connected applications praying for, inter alia, urgent interim reliefs. The said appeal was preferred against an order of the lower commercial court wherein the instant appellant's prayer for interim injunction was not granted.
Counsels for the respondents raised a preliminary objection on the maintainability of the instant appeal on the ground that the impugned lower court order was passed on put applications and thus could not be construed to have been passed on a substantive application. The respondents accordingly contended that such decision did not come within the purview of Order 43 of CPC.
Counsels for the appellants argued that the order amounted to an implied denial to pass an interim injunction and therefore, satisfied the ingredients of Order 43.
The Court said that principle of 'implied denial' of interim relief by directing service of application for interim injunction is not applicable in this case. It held:
"The opening sentence of the impugned order is manifestly clear that the aforesaid two applications were fixed for the hearing which are merely the put up applications, which are ordinarily filed inviting the Court to take up the other applications and permit the plaintiff to move the same. Any decision taken thereupon cannot be construed to have impact upon the substantive applications which, in fact, were not before the Court nor the Court had any occasion to apply its mind thereupon. We are not unmindful of the proposition of law that the moment an application for temporary injunction is moved and the Court simply directs the service thereof, it may be termed as implied denial of an interim relief but certainly such principles cannot be applied to a situation where the put up petitions were filed inviting the attention of the Court to fix a date for hearing of the applications for temporary injunction for the interim relief. Nothing can be deciphered from the impugned order suggesting remotely the refusal to pass an interim order and, therefore, we do not find that such order is amenable to be challenged by way of an appeal under Section 13 of the Act."
Therefore, the Court refused to interfere with the impugned order on the ground that put up applications were filed seeking to fix a date for hearing of such applications for interim injunction.
Accordingly, it dismissed the appeal as not maintainable.
Case: M/s. Odisha Slurry Pipeline Infrastructure Ltd. & Anr. V. IDBI Bank Ltd. & Ors., FMAT 360 of 2022