Commercial Courts Act | Can't Permit Written Statement After 120 Days, Summer Vacations Not 'Extraordinary Circumstance': MP High Court

In a commercial suit, Madhya Pradesh High Court has underscored that a written statement filed after the lapse of 120 days since the service of summons cannot be taken on record.

The Division Bench of Justices Sujoy Paul and Vivek Jain also refused to consider routine summer vacations as an 'extraordinary circumstance' mentioned in Prakash Corporates v. Dee Vee Projects Limited, 2022 LiveLaw (SC) 162 that warrants a relaxation of the rigid 120 days' duration. In Prakash Corporates, the apex court held that suo motu limitation extension orders due to Covid-19 will apply to filing of written statements in commercial suits too.

“…in Prakash Corporates… it was made clear that the principle laid down regarding expiry of mandatory period of 120th day is a principle of law laid down which is mandatory and binding. The only relaxation given was because of Covid-19 pandemic, which was treated to be an 'extraordinary situation/circumstance'…We are unable to equate the 'summer vacations' which are routine in nature with 'Covid-19 situation'…”, the bench sitting at Jabalpur opined.

The Division Bench also gave due attention to the fact that the petitioners/defendants could have filed the written statement until 21.07.2023 whereas the summer vacation ended by the beginning of June.

Though the petitioners/defendants urged the court to consider the High Court's decision in Telecommunications Consultants India Limited v. Rajendra Singh Kiledar Construction Private Limited & Ors.(2022), Justices Sujoy Paul and Vivek Jain differentiated the same by iterating Proviso to Section 15(4) of the Commercial Courts Act, 2015. The Jabalpur bench pointed out that the case in Telecommunications Consultants India was a Class-B civil suit which was later transferred to a commercial court. Thereafter, a fresh timeline was prepared as per the proviso to Section 15(4) which states that courts will have the discretion to prescribe a new time period for filing of the written statement for the suits and applications transferred to the commercial courts under Section 15(2). Since no such fresh timeline was allowed by the lower court in that case, the High Court interfered to take the written statement on record and ensured adherence to the objectives of the Commercial Courts Act.

However, in this instance, the court observed that the case was originally filed before the competent commercial court itself. The court accordingly dismissed the miscellaneous petition filed by the defendants seeking a direction to the lower court to accept their written statement.

In SCG Contracts (India) Private Limited v. K.S. Chamankar Infrastructure Private Limited & Ors. (2019), a Division Bench of Justices R.F. Nariman and Vineet Saran had observed that the proviso added to Order VIII Rule 1 of the Code of Civil Procedure by Commercial Courts, Act, 2015, is mandatory and no written statement can be taken on record in commercial suits, if it is not filed within 120 days from the date of service of summons of the Suit. This established principle was also repeatedly stated by the High Court while dismissing the defendants' petition.

Advocate Jayant Prakash Patel appeared for the petitioners. Advocate Sarabvir Singh Oberoi represented Respondents 1 & 2.

Case Title: Itarsi Pipes Sales & Anr. v. OMRF Pipes And Products & Ors.

Case No: Misc. Petition No.6405 of 2023

Citation: 2024 LiveLaw (MP) 21

Click Here To Read/ Download Order