Case Note & Summary
The petitioners, original defendants in a suit for specific performance of an agreement to sell immovable property, filed a writ petition challenging the order of the Joint Civil Judge Senior Division, Nagpur, which refused to transfer the suit to the Commercial Court under Section 15(2) of the Commercial Courts Act, 2015. The suit was filed by respondent no.1 seeking specific performance of an agreement dated 04-04-2015, whereby petitioner no.1 agreed to sell certain immovable property. The petitioners contended that the dispute was a commercial dispute under Section 2(1)(c) of the Act because the property was intended to be used for commercial purpose. The trial court rejected the application, holding that the suit was not a commercial dispute. The High Court examined the definition of 'commercial dispute' under Section 2(1)(c), which includes suits relating to immovable property used exclusively in trade or commerce. The court noted that the suit was for specific performance of an agreement to sell immovable property, and there was no pleading or evidence that the property was used for commercial purpose. The court held that the mere intention to use the property for commercial purpose in the future does not bring the dispute within the definition. The court also observed that the suit was essentially for enforcement of a contract for sale of immovable property, which is not a commercial dispute unless the property is actually used in trade or commerce. The High Court dismissed the petition, upholding the trial court's order and holding that the suit was not liable to be transferred to the Commercial Court.
Headnote
A) Commercial Courts Act, 2015 - Commercial Dispute - Section 2(1)(c) - Suit for Specific Performance - The definition of 'commercial dispute' under Section 2(1)(c) of the Commercial Courts Act, 2015, includes suits relating to immovable property used exclusively in trade or commerce. In the present case, the suit was for specific performance of an agreement to sell immovable property, but the property was not used for commercial purpose. The court held that the suit does not fall within the definition of commercial dispute and the trial court was justified in refusing to transfer the suit to the Commercial Court. (Paras 2-10)
B) Commercial Courts Act, 2015 - Transfer of Suit - Section 15(2) - The provision for transfer of pending suits to Commercial Court under Section 15(2) applies only to suits that are commercial disputes as defined under Section 2(1)(c). Since the suit in question was not a commercial dispute, the application for transfer was rightly rejected. (Paras 5-10)
Issue of Consideration
Whether a suit for specific performance of an agreement to sell immovable property, where the property is not used for commercial purpose, constitutes a 'commercial dispute' under Section 2(1)(c) of the Commercial Courts Act, 2015, and whether the trial court was justified in refusing to transfer the suit to the Commercial Court under Section 15(2) of the said Act.
Final Decision
The High Court dismissed the writ petition, upholding the trial court's order dated 26-04-2018, and held that the suit for specific performance of an agreement to sell immovable property was not a commercial dispute under Section 2(1)(c) of the Commercial Courts Act, 2015, and therefore the trial court was justified in refusing to transfer the suit to the Commercial Court under Section 15(2).
Law Points
- Commercial dispute
- Specific performance
- Immovable property
- Commercial purpose
- Section 2(1)(c) Commercial Courts Act
- 2015
- Section 15(2) Commercial Courts Act
Case Details
2019 LawText (BOM) (03) 127
Writ Petition No.4080 of 2018
Mr. A.G. Gharote for petitioners, Mr. R.T. Anthony for respondent no.1, Mr. R.R. Shrivastava for respondent nos. 2 and 3
Kanchanganga Realtors Pvt. Ltd, Rajesh Ashokji Dawda, Sudhanshu Mohan Degwekar
M/s Monarch Infrastructure Developers Pvt. Ltd., Dr. Mahesh Chandumal Fulwani, Narendra Dharnidhar Gandhi
Subscribe to unlock Case Details (Citation, Judge, Date & more)
Subscribe Now
Nature of Litigation
Writ petition challenging the order of the trial court refusing to transfer a suit for specific performance to the Commercial Court under Section 15(2) of the Commercial Courts Act, 2015.
Remedy Sought
The petitioners (original defendants) sought transfer of the suit filed by respondent no.1 from the trial court to the Commercial Court.
Filing Reason
The petitioners contended that the suit for specific performance of an agreement to sell immovable property was a commercial dispute under Section 2(1)(c) of the Commercial Courts Act, 2015, and therefore should be transferred to the Commercial Court under Section 15(2).
Previous Decisions
The trial court (Joint Civil Judge Senior Division, Nagpur) by order dated 26-04-2018 rejected the application for transfer, holding that the suit was not a commercial dispute.
Issues
Whether a suit for specific performance of an agreement to sell immovable property, where the property is not used for commercial purpose, constitutes a 'commercial dispute' under Section 2(1)(c) of the Commercial Courts Act, 2015.
Whether the trial court was justified in refusing to transfer the suit to the Commercial Court under Section 15(2) of the Commercial Courts Act, 2015.
Submissions/Arguments
Petitioners argued that the immovable property in question was intended to be used for commercial purpose, and therefore the dispute fell within the definition of 'commercial dispute' under Section 2(1)(c) of the Commercial Courts Act, 2015, and the suit ought to be transferred under Section 15(2).
Respondent no.1 opposed the application, contending that the suit was for specific performance of an agreement to sell immovable property and was not a commercial dispute.
Ratio Decidendi
A suit for specific performance of an agreement to sell immovable property does not constitute a 'commercial dispute' under Section 2(1)(c) of the Commercial Courts Act, 2015, unless the property is used exclusively in trade or commerce. The mere intention to use the property for commercial purpose in the future is insufficient to bring the dispute within the definition. Consequently, the trial court was justified in refusing to transfer the suit to the Commercial Court under Section 15(2) of the Act.
Judgment Excerpts
The question that arises for consideration in this petition is, as to whether the impugned order passed by the Court of Joint Civil Judge Senior Division, Nagpur (trial Court), in refusing to transfer the suit filed by respondent no.1, under Section 15(2) of the Commercial Courts Act, 2015 to the Commercial Court, was justified in the facts and circumstances of the present case.
By the impugned order dated 26042018, the trial Court found that the suit was not a commercial dispute and therefore, the application filed by the petitioners was rejected.
Procedural History
Respondent no.1 filed a suit for specific performance of an agreement to sell immovable property dated 04-04-2015 before the Joint Civil Judge Senior Division, Nagpur. The petitioners (original defendants) entered appearance and filed an application under Section 15(2) of the Commercial Courts Act, 2015 seeking transfer of the suit to the Commercial Court. The trial court rejected the application by order dated 26-04-2018. The petitioners then filed the present writ petition before the Bombay High Court, Nagpur Bench, challenging the said order. The High Court heard the matter and dismissed the petition on 08-02-2019.
Acts & Sections
- Commercial Courts Act, 2015: Section 2(1)(c), Section 15(2)
