Commercial Courts Act vs. CPC | Power To Condone Delay In Filing Written Statement In Commercial Suits Substantially Different: Delhi High Court

The Delhi High Court has observed that the Commercial Courts Act brings about a substantial change in the provisions relating to the period of filing of the written statement and the power of the Court to condone the delay in filing of the written statement as far as the commercial suits are concerned.

Order VIII Rule 1 of CPC prescribes that written statement has to be presented within thirty days from the date of service of summons, failing which, delay of not more than 90 days (from date of service of summons) may be condoned by the Court.

Section 16 of the Commercial Courts Act makes an amendment to the provision qua commercial suits of a specified value to provide that written statement has to be presented within thirty days from the date of service of summons failing which, delay of not more than 120 days (from date of service of summons) may be condoned by the Court. 

However, in SCG Contracts India Pvt. Ltd vs. K.S. Chamankar Infrastructure Pvt. Ltd, the Supreme Court observed that this proviso 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.

Justice Navin Chawla observed that the object and purpose of the Commercial Courts Act is to ensure that the commercial cases are disposed of expeditiously, fairly and at a reasonable cost to the litigant.

The bench further reiterated that the delay in filing of the written statement in commercial suits can be condoned by the court for reasons to be recorded in writing, however, it added that such reasons cannot be presumed by the Court, but are to be provided by the defendants.

"The defendant cannot take its own sweet time to supply such reasons to the court. The court is not to await endlessly for the same," the Court said.

The Court was dealing with an appeal filed by original defendants in the suit, challenging the order dated passed by the Joint Registrar (Judicial) dismissing an application seeking condonation of delay in filing of the written statement. In the suit, an ad-interim injunction was granted in favour of the plaintiff restraining the defendants from using the plaintiff's trade/service marks/ name 3M or any mark deceptively similar mark.

The suit was listed before the Joint Registrar (Judicial) for further proceedings when it was pointed out to the counsel for the defendants that the written statement, the affidavit of admission or denial of the plaintiff's documents, and the documents filed were not on record.

The statement of the counsel for the plaintiff was also recorded to the effect that the written statement had not been filed within the statutory period. On this submission, the counsel for the defendants sought time for filing an appropriate application seeking condonation of delay in filing of the written statement.

The application seeking condonation of delay was dismissed by the Joint Registrar (Judicial) by way of the impugned order on the ground that when the written statement was filed by the defendants in the suit on the 118th day of service of summons, no application for condonation of delay was filed with it.

The Court was of the view that the defendants failed to make out any case for the grant of condonation of delay in filing of their written statement.

"The object and purpose of the Commercial Courts Act is to ensure that the commercial cases are disposed of expeditiously, fairly and at a reasonable cost to the litigant. The Commercial Courts Act was enacted with the intent to improve the efficiency and reduce delays in disposal of commercial cases," the Court observed.

It added "Therefore, the Commercial Courts Act brings about a substantial change in the provisions relating to the period of filing of the written statement and the power of the Court to condone the delay in filing of the written statement as far as the commercial suits are concerned."

The Court noted that the written statement was filed on the 118th day from the date of service of summons on the defendants and that the same was not accompanied with an application seeking condonation of delay in filing of the same.

The Court thus observed:

"The defendants/appellants, already having been warned that their written statement would not come on record for there being no application seeking condonation of delay in filing of the same, were not expected to await the return of the written statement by the Registry of this Court. On their own, they were supposed to file an application seeking condonation of delay so that their written statement could be brought on record. Clearly, the defendants/appellants were trying to take advantage of the process of the Court and delay the adjudication of the present suit. To accept the same would be to defeat the very object and purpose of the Commercial Courts Act."

With the aforementioned discussion, the appeal was dismissed.

Case Title: 3M COMPANY v. MR. VIKAS SINHA & ANR

Citation: 2022 LiveLaw (Del) 622

Click Here To Read Order