Bar U/S 8 Of Commercial Courts Act On Revision Application/ Petition Not Applicable To Petitions Under Article 227: Delhi High Court

The Delhi High Court has held that the bar provided under Section 8 of the Commercial Courts Act against entertaining revision application or petition against any interlocutory order of a Commercial Court, is not applicable to petitions under Article 227 of the Constitution of India.

A Division Bench of Justice Rajiv Sahai Endlaw and Justice Amit Bansal held that the jurisdiction and powers of the High Court in entertaining petition under Art. 227 cannot be affected by a statute framed by a legislature.

The Court observed:

"...the petition under Article 227 of the Constitution of India to the High Court with respect to orders of the Commercial Courts at the level of the District Judge is maintainable and the jurisdiction and powers of the High Court has not been and could not have been affected in any manner whatsoever by Section 8 of the Commercial Courts Act."

"The use of the word "petition" in Section 8 is not and could not have been with reference to a petition under Article 227 of the Constitution and is with reference to a revision application / revision petition only."

The observation came in two petitions raising common questions of law challenging the orders passed by District Judge, Commercial jurisdiction, dismissing the petitioners' applications.

While one of the petitions challenged the dismissal of application under Order VII Rule 11 of the Code of Civil Procedure, the other Petition challenged dismissal of application under Order VIII Rule 1 of the CPC for condonation of delay in filing the written statement. Both the petitions were therefore listed before a single judge of the High Court.

The Court accepted the submissions made by Senior Advocate Amarjit Singh Chandhiok appearing for the respondent in one of the Petitions that the remedy under Article 227 being a constitutional remedy could not be affected by a statute framed by a legislature which was itself a creature of constitution.

The Court relied on the judgement delivered by the Supreme Court in Surya Dev Rai Vs. Ram Chander Rai (2003) 6 SCC 675 wherein it was held that curtailment of revisional jurisdiction of the High Court did not take away and could not have taken away it's constitutional jurisdiction to issue a writ of certiorari to a civil court, nor was it's power of superintendence can be taken away or whittled down.

It was also argued by Chandhiok that remedy under Article 227 being de hors the Commercial Courts Act, would not be governed and guided by the Commercial Courts Act and would be governed by the roster allocation of the High Court. 

In view of this, the Court observed that petitions under Article 227 arising from proceedings in commercial suits at the level of the District Judge would be heard by the bench empowered under High Court's roster to hear such petitions. 

"Of course, it is open to Hon‟ble the Chief Justice to in his discretion allocate hearing of petitions under Article 227 emanating from commercial suits at the level of the District Judge, to any other bench including to a division bench," the Court added.

On the other hand, it was submitted by Advocate Praveen Chaturvedi appearing for one of the petitioners that the petition under Article 227 of the Constitution of India has been filed, because revision under Section 115 of the CPC is barred under the Commercial Courts Act.

Accordingly, the Court observed that once the Commercial Courts Act has expressly barred the remedy of a revision application under Section 115 of the CPC, the purpose cannot be permitted to be defeated by opening up the gates of Article 227 of the Constitution of India.

"Thus, though we are of the view that gates of Article 227 ought not to be opened with respect to orders in commercial suits at the level of the District Judge against which a revision application under CPC was maintainable but which remedy has been taken away by the Commercial Courts Act, but abiding by the judgments aforesaid, hold that it cannot be said to be the law that jurisdiction under Article 227 is completely barred," the Court added.

The Court also clarified that such a jurisdiction must be exercised very sparingly with respect to orders that are revisable under CPC and for which remedy has been taken away by a subsequent legislation i.e. the Commercial Courts Act.

Observing so, the Court added that exercise of such jurisdiction by the High Court must not negate the legislative intent and purpose behind the Commercial Courts Act and must not come in the way of expeditious disposal of commercial suits.

Holding that the petitions under Article 227 of the Constitution of India are maintainable, the Court ordered thus:

"Accordingly, list CM (M) No.132/2021 as well as CM(M) No.225/2021 before a bench allocated to hear petitions under Article 227 of the Constitution of India as per roster, on 27th August, 2021."

Case Title: BLACK DIAMOND TRACKPARTS PVT v. BLACK DIAMOND MOTORS PVT. LTD.

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