$~107

* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Date of Decision: 31st May, 2023
+ C.R.P. 150/2023
SATISH MISHRA ..... Petitioner
Through: Mr. Sanyam Khetarpal and
Ms. Prakriti Anand, Advocates
| Printed using casemine.com by licensee : Prashant Goudar

versus
DEEPAK ..... Respondent
Through: None.
CORAM:
HON’BLE MS. JUSTICE JYOTI SINGH
JUDGEMENT

JYOTI SINGH, J. (ORAL)

C.M. No. 30455/2023 (exemption)
1. Allowed, subject to all just exceptions.
2. Application stands disposed of.
C.R.P. 150/2023 & C.M. No. 30454/2023 (stay)
3. By this revision petition, the Petitioner assails an order dated
02.03.2023 passed by the Trial Court dismissing the application filed
by the Petitioner under Order VII Rule 11 CPC. Petitioner herein is
the Defendant before the Trial Court while the Respondent is the
Plaintiff and parties hereinafter are referred to by their litigating status
before the Trial Court.
4. Narrative of facts as captured in the revision petition is that
Defendant is a Proprietorship concern carrying on the activity of
interior designing and renovation work of constructed properties. In
June, 2021 Defendant approached the Plaintiff for interiors and
renovation work of his property and after initial negotiations and
C.R.P. 150/2023 Page 1 of 11
 discussions, an estimated price was worked out between the parties for
the entire project. However, after some work was carried out the
parties fell apart and Plaintiff sent a legal notice dated 23.11.2021 to
the Defendant demanding the alleged outstanding amounts due to the
Plaintiff. Failing to receive the said amounts, Plaintiff filed a suit for
recovery of Rs.29,36,498/- being CS (COMM) No. 418/2021.
| Printed using casemine.com by licensee : Prashant Goudar

5. It is averred in the petition that with the intervention of

acquaintances and friends, settlement was arrived at between the
parties on 04.03.2022 and Plaintiff carried out further work in the
concerned property. An invoice for the balance amount was raised by
the Plaintiff on the Defendant, which was not paid. On account of the
settlement agreement, the earlier suit was withdrawn by the Plaintiff
and the present suit was filed subsequently for recovery of
Rs.8,85,460/- along with applicable GST and pendente lite and future
interest @ 18% p.a.
6. Upon service of summons, Defendant filed his written
statement and an application under Order VII Rule 11 CPC for
rejection of plaint on account of failure on the part of the Plaintiff to
exhaust the remedy of pre-institution mediation as mandatorily
required under Section 12A of the Commercial Courts Act, 2015
(hereinafter referred to as the ‘Act 2015’). It was urged in the
application that Plaintiff had neither filed an application seeking
exemption or leave from resorting to pre-institution mediation and
relied on the judgment of the Supreme Court in Patil Automation
Private Limited and Others v. Rakheja Engineers Private Limited,
(2022) 10 SCC 1, in this regard.

C.R.P. 150/2023 Page 2 of 11

 7. Plaintiff, on the other hand, opposed the application on the
ground that along with the plaint an application had been filed for
urgent interim relief under Order XXXIX Rules 1 and 2 CPC read
with Order XXXVIII Rule 5 CPC and therefore the Plaintiff was not
required to take recourse to the remedy of pre-institution mediation
under Section 12A of Act 2015.
| Printed using casemine.com by licensee : Prashant Goudar

8. The Trial Court was of the view that since an urgent interim
relief was contemplated, Plaintiff was not bound to take recourse to
the remedy of pre-institution mediation and whether or not the Court
would grant the relief sought was irrelevant for deciding whether the
plaint ought to be rejected on the ground of the failure of the Plaintiff
to take recourse to the remedy and thus the Trial Court dismissed the
application.
9. Challenging the impugned order, learned counsel for the
Defendant contends that the Trial Court has failed to consider the
settled position of law that if by means of clever drafting, a
camouflage or illusionary urgent relief is created, such cases should be
nipped in the bud. Plaintiff had initially filed the plaint with an
application under Order XXXIX Rules 1 and 2 CPC read with Order
XXXVIII Rule 5 CPC seeking attachment before judgment by way of
freezing the bank account of the Defendant, although the suit is a
simplicitor suit for recovery. Defendant is the owner of the property in
question, which carries a valuation far in excess of the amounts
allegedly due to the Plaintiff and therefore there was no question of
seeking a relief of freezing the bank accounts of the Defendant or a
direction to the Defendant to furnish security. There was thus no
urgency in the matter and the Trial Court ought to have rejected the

C.R.P. 150/2023 Page 3 of 11

 plaint for failure of the Plaintiff to take recourse to the mandatory
procedure under Section 12A of Act 2015.
10. I have heard the learned counsel for the Defendant and
examined the contentions as well as the impugned order passed by the
Trial Court.
11. The issue whether provisions of Section 12A of Act 2015 are
| Printed using casemine.com by licensee : Prashant Goudar

mandatory is no longer res integra. The Supreme Court has in Patil

Automation Private Limited and Others (supra), clearly propounded
that provisions of Section 12A are mandatory and failure to comply
would entail rejection of the plaint. Relevant paras of the judgment are
as follows:-
“100. In the cases before us, the suits do not contemplate urgent
interim relief. As to what should happen in suits which do
contemplate urgent interim relief or rather the meaning of the word
“contemplate” or urgent interim relief, we need not dwell upon it.
The other aspect raised about the word “contemplate” is that there
can be attempts to bypass the statutory mediation under Section 12-
A by contending that the plaintiff is contemplating urgent interim
relief, which in reality, it is found to be without any basis. Section
80(2)CPC permits the suit to be filed where urgent interim relief is
sought by seeking the leave of the court. The proviso to Section 80(2)
contemplates that the court shall, if, after hearing the parties, is
satisfied that no urgent or immediate relief need be granted in the
suit, return the plaint for presentation to the court after compliance.
Our attention is drawn to the fact that Section 12-A does not
contemplate such a procedure. This is a matter which may engage
attention of the lawmaker. Again, we reiterate that these are not
issues which arise for our consideration. In the fact of the cases
admittedly there is no urgent interim relief contemplated in the
plaints in question.
xxx xxx xxx
113. Having regard to all these circumstances, we would dispose of
the matters in the following manner:
113.1. We declare that Section 12-A of the Act is mandatory and
hold that any suit instituted violating the mandate of Section 12-A
must be visited with rejection of the plaint under Order 7 Rule 11.
This power can be exercised even suo motu by the court as explained
earlier in the judgment. We, however, make this declaration effective
C.R.P. 150/2023 Page 4 of 11
 from 20-8-2022 so that stakeholders concerned become sufficiently
informed.
113.2. Still further, we however direct that in case plaints have been
already rejected and no steps have been taken within the period of
limitation, the matter cannot be reopened on the basis of this
declaration. Still further, if the order of rejection of the plaint has
been acted upon by filing a fresh suit, the declaration of prospective
effect will not avail the plaintiff.
113.3. Finally, if the plaint is filed violating Section 12-A after the
jurisdictional High Court has declared Section 12-A mandatory also,
| Printed using casemine.com by licensee : Prashant Goudar

the plaintiff will not be entitled to the relief.”

12. A Division Bench of this Court in Chandra Kishore Chaurasia

v. RA Perfumery Works Private Ltd., 2022 SCC OnLine Del 3529
has elaborately dealt with various issues pertaining to Section 12A of
Act 2015 and two of them squarely apply to the present case. The
Division Bench has held that Section 12A indicates that institution of
a suit, which does not contemplate any urgent interim relief, is
proscribed unless the Plaintiff exhausts the remedy of pre-institution
mediation and therefore there is no ambiguity that a suit which
contemplates urgent interim relief is excluded from the rigor of
Section 12A(1). The Court also held that the provision does not
contemplate any application for exemption from the applicability of
Section 12A(1) and no such discretion to grant exemption vests in the
Court for the simple reason that the provision is mandatory and if
there is no urgent relief claimed, the suit cannot be filed without
taking recourse to pre-institution mediation. Significantly, the
Division Bench has also held that whether a suit involves an urgent
interim relief is to be determined solely on the basis of the pleadings
and reliefs sought by the Plaintiff. If a Plaintiff seeks any urgent
interim relief, the suit cannot be dismissed on the ground that Plaintiff
has not exhausted the remedy of pre-institution mediation. The
C.R.P. 150/2023 Page 5 of 11
 important observation of the Division Bench that is particularly
applicable to this case is that ‘the Court may or may not accede to
such a request for an urgent interim relief. But that is not relevant to
determine whether the Plaintiff was required to exhaust the remedy of
pre-institution mediation. The question whether a suit involves any
urgent interim relief is not contingent on whether the Court accedes to
| Printed using casemine.com by licensee : Prashant Goudar

the Plaintiff’s request for interim relief.’ The Court also observed that
compulsory mediation is foisted only on a Plaintiff who does not
contemplate urgent interim relief and therefore it is implicit that it is
only the Plaintiff that can contemplate the relief it seeks in a suit.
Relevant passages from the judgment are as follows:-
“23. The respondent contends that the learned Commercial Court
had erred in rejecting its application under Order VII Rule 11(d) of
the CPC. According to the respondent, the plaint is liable to be
rejected as being barred in terms of Section 12A of the Commercial
Courts Act, 2015. The learned Commercial Court had rejected the
said contention as it found that the provisions of Section 12A of the
Commercial Courts Act, 2015 were not applicable because the
appellant (plaintiff) had sought urgent interim reliefs.
24. Mr. Sengupta, learned counsel appearing for the respondent,
did not dispute that the provisions of Section 12A of the Commercial
Courts Act, 2015 are not applicable to suits involving urgent reliefs.
He, however, submitted that the appellant (plaintiff) could not be the
sole judge of determining whether the provisions of Section 12A of
the Commercial Courts Act, 2015 are applicable. Therefore, it was
necessary for the appellant (plaintiff) to file an application seeking
exemption from the provision of pre-institution mediation. He
contended that ae suit could be entertained only once such an
application was moved and allowed.
25. He referred to an order dated 30.09.2020, passed by the
learned Single Judge of this Court in an application seeking
amendment of the plaint filed by the plaintiff in CS(OS)
201/2020 captioned Anil Gupta v. Baburam Singla, Proprietor of
Singla Sweets. He pointed out that in the said order, the Court had
observed that the plaintiff had neither filed an application seeking
exemption nor leave in the present suit for exempting the plaintiff
from the process under Section 12A of the Commercial Courts Act,
2015. Further, the Court had issued summons subject to the plaintiff
filing an application seeking exemption under Section 12A of the
C.R.P. 150/2023 Page 6 of 11
 Commercial Courts Act, 2015 to the defendants.
26. He referred to the decision of the Supreme Court in Patil
Automation Private Limited v. Rakheja Engineers Private
Limited, 2022 SCC OnLine SC 1028 and contended that the
provisions of Section 12A of the Commercial Courts Act, 2015 are
mandatory and on an analogy of Section 80 of the CPC - which was
also referred to by the Supreme Court in its decision - it was
necessary for the plaintiff to make an application seeking exemption
from the provisions of Section 12A of the Commercial Courts Act,
2015.
| Printed using casemine.com by licensee : Prashant Goudar

27. The question whether the provisions of Section 12A of the

Commercial Courts Act, 2015 are mandatory, is no longer res
integra. In Patil Automation Private Limited v. Rakheja Engineers
Private Limited (supra), the Supreme Court has authoritatively held
that the provisions of Section 12A of the Commercial Courts Act,
2015 are mandatory and failure to comply with the same would
entail rejection of the plaint. However, in the present case, the
question whether the provisions under Section 12A of the
Commercial Courts Act, 2015 are mandatory or not is not in issue;
the point for consideration is whether the provisions of Section 12A
of the Commercial Courts Act, 2015 are applicable to the suit
instituted by the appellant.
28. Section 12A of the Commercial Courts Act, 2015 reads as
under:
“12A. (1) A suit, which does not contemplate any urgent interim
relief under this Act, shall not be instituted unless the plaintiff
exhausts the remedy of pre-institution mediation in accordance
with such manner and procedure as may be prescribed by rules
made by the Central Government.
(2) The Central Government may, by notification, authorise the
Authorities constituted under the Legal Services Authorities Act,
1987, for the purposes of pre-institution mediation.
(3) Notwithstanding anything contained in the Legal Services
Authorities Act, 1987, the Authority authorised by the Central
Government under sub-section (2) shall complete the process of
mediation within a period of three months from the date of
application made by the plaintiff under sub-section (1):
Provided that the period of mediation may be extended for a
further period of two months with the consent of the parties:
Provided further that, the period during which the parties
remained occupied with the pre-institution mediation, such
period shall not be computed for the purpose of limitation under
the Limitation Act, 1963.
(4) If the parties to the commercial dispute arrive at a
C.R.P. 150/2023 Page 7 of 11
 settlement, the same shall be reduced into writing and shall be
signed by the parties to the dispute and the mediator.
(5) The settlement arrived at under this section shall have the
same status and effect as if it is an arbitral award on agreed
terms under sub-section (4) of section 30 of the Arbitration and
Conciliation Act, 1996.”.
29. A plain reading of Sub-section (1) of Section 12A of the
Commercial Courts Act, 2015 indicates that the institution of a suit,
which does not contemplate any urgent interim relief, is proscribed
unless the plaintiff exhausts the remedy of pre-institution mediation
| Printed using casemine.com by licensee : Prashant Goudar

in accordance with the procedure as may be prescribed. There is no

ambiguity that a suit, which contemplates urgent interim relief, is
excluded from the rigor of Section 12A(1) of the Commercial Courts
Act, 2015. Thus, a plaintiff seeking to institute a suit involving urgent
interim relief(s) is not required to exhaust the remedy of pre-
institution mediation.
30. The contention that it would be necessary for the plaintiff to
file an application seeking exemption from the provisions of Section
12A of the Commercial Courts Act, 2015, is unmerited. This Court
cannot accept the said contention for several reasons.
31. First of all, there is no provision under Section 12A of the
Commercial Courts Act, 2015 that requires the plaintiff to make any
such application in a suit which involves urgent interim reliefs. As
stated above, if the suit involves urgent interim relief, Section 12A of
the Commercial Courts Act, 2015 is inapplicable and it is not
necessary for the plaintiff to enter into a pre-institution mediation.
32. Second, a suit, which does not contemplate urgent interim
relief, cannot be instituted without exhaustion of pre-institution
mediation, as required under Section 12A(1) of the Commercial
Courts Act, 2015. As noted above, the Supreme Court has held that
the said provision is mandatory and it is compulsory for a plaintiff to
exhaust the remedy of pre-institution mediation, in accordance with
the rules before instituting a suit. The Court has no discretion to
exempt a plaintiff from the applicability of Section 12A(1) of the
Commercial Courts Act, 2015. It is not permissible for the court to
pass an order contrary to law; therefore, an application seeking
exemption from engaging in pre-institution mediation, in a suit that
does not involve urgent interim reliefs, would not lie.
33. This Court also finds it difficult to accept that a commercial
court is required to determine whether the urgent interim reliefs
ought to have been claimed in a suit for determining whether the
same is hit by the bar of Section 12A(1) of the Commercial Courts
Act, 2015. The question whether a plaintiff desires any urgent relief
is to be decided solely by the plaintiff while instituting a suit. The
court may or may not accede to such a request for an urgent interim
C.R.P. 150/2023 Page 8 of 11
 relief. But that it not relevant to determine whether the plaintiff was
required to exhaust the remedy of pre-institution mediation. The
question whether a suit involves any urgent interim relief is not
contingent on whether the court accedes to the plaintiff's request for
interim relief.
34. The use of the words “contemplate any urgent interim relief”
as used in Section 12(1) of the Commercial Courts Act, 2015 are
used to qualify the category of a suit. This is determined solely on
the frame of the plaint and the relief sought. The plaintiff is the sole
determinant of the pleadings in the suit and the relief sought.
| Printed using casemine.com by licensee : Prashant Goudar

35. This Court is of the view that the question whether a suit
involves any urgent interim relief is to be determined solely on the
basis of the pleadings and the relief(s) sought by the plaintiff. If a
plaintiff seeks any urgent interim relief, the suit cannot be dismissed
on the ground that the plaintiff has not exhausted the pre-institution
remedy of mediation as contemplated under Section 12A(1) of the
Commercial Courts Act, 2015.
36. The order dated 30.09.2018, passed by the learned Single
Judge in Anil Gupta v. Baburam Singla, Proprietor of Singla
Sweets (supra), is of little assistance to the respondent. The
observations made in the said order are not dispositive of any
question whether a separate application is required to be made
under Section 12A of the Commercial Courts Act, 2015. The
contention that such an application is required to be made on an
analogy of Section 80 of the CPC is also erroneous. In Patil
Automation Private Limited v. Rakheja Engineers Private
Limited (supra), the Supreme Court had pointed out that unlike the
provisions of Section 80 of the CPC, there is no provision in Section
12A of the Commercial Courts Act, 2015 that contemplates a
procedure for seeking leave of the court. Paragraph 81 of the said
decision is relevant and set out below:
“81. In the cases before us, the suits do not contemplate urgent
interim relief. As to what should happen in suits which do
contemplate urgent interim relief or rather the meaning of the
word ‘contemplate’ or urgent interim relief, we need not dwell
upon it. The other aspect raised about the word ‘contemplate’ is
that there can be attempts to bypass the statutory mediation
under Section 12A by contending that the plaintiff is
contemplating urgent interim relief, which in reality, it is found
to be without any basis. Section 80(2) of the CPC permits the
suit to be filed where urgent interim relief is sought by seeking
the leave of the court. The proviso to Section 80 (2)
contemplates that the court shall, if, after hearing the parties, is
satisfied that no urgent or immediate relief need be granted in
the suit, return the plaint for presentation to the court after
compliance. Our attention is drawn to the fact that Section 12A
C.R.P. 150/2023 Page 9 of 11
 does not contemplate such a procedure. This is a matter which
may engage attention of the lawmaker. Again, we reiterate that
these are not issues which arise for our consideration. In the
fact of the cases admittedly there is no urgent interim relief
contemplated in the plaints in question.”
[emphasis added]
37. This Court is unable to accept that it is necessary for a court
to read in any procedure in Section 12A of the Commercial Courts
Act, 2015, which makes it mandatory for a plaintiff to file an
application to seek leave of the court for filing a suit without
| Printed using casemine.com by licensee : Prashant Goudar

exhausting the remedy of pre-institution mediation, irrespective of

whether the plaintiff seeks urgent interim relief or not.
38. In Patil Automation Private Limited v. Rakheja Engineers
Private Limited (supra), the Supreme Court had considered the
import of Section 12A of the Commercial Courts Act, 2015 in the
context of the suits, which did not contemplate any urgent interim
relief. It is relevant to refer to the following observations of the
court:
“…The Act did not originally contain Section 12A. It is by
amendment in the year 2018 that Section 12A was inserted. The
Statement of Objects and Reasons are explicit that Section 12A
was contemplated as compulsory. The object of the Act and the
Amending Act of 2018, unerringly point to at least partly
foisting compulsory mediation on a plaintiff who does not
contemplate urgent interim relief…”
39. It is apparent from the above that the Supreme Court was
also of the view that compulsory mediation is foisted only on a
plaintiff who does not contemplate urgent interim relief. It is implicit
that it is only the plaintiff, that can contemplate the relief that it
seeks in a suit. And, pre-institution mediation is necessary only in
cases where a plaintiff does not contemplate urgent interim relief.
40. In the present case, indisputably, the plaintiff has sought
urgent interim reliefs. Thus, it is not necessary for him to have
exhausted the remedy of pre-institution mediation as contemplated
under Section 12A(1) of the Commercial Courts Act, 2015.”
13. This judgment was subsequently followed by a Co-ordinate
Bench of this Court in Yamini Manohar v. TKD Keerthi, 2023 SCC
OnLine Del 2653 and it was held that the Commercial Court correctly
came to a conclusion that the Plaintiff contemplated grant of urgent
interim relief and was thus not required to exhaust the remedy of pre-
institution mediation.
C.R.P. 150/2023 Page 10 of 11
 14. Therefore, in view of the judgment of the Division Bench in
Chandra Kishore Chaurasia (supra,) both the contentions of the
Defendant deserve to be rejected. The Court has clearly held that it is
for the Plaintiff to decide whether he desires to seek an urgent interim
relief and if so the nature of relief sought and secondly, whether or not
the Court ultimately accedes to the relief is irrelevant to decide
| Printed using casemine.com by licensee : Prashant Goudar

whether the Plaintiff was required to exhaust the remedy of pre-

institution mediation. The Trial Court has come to a finding that the
Plaintiff has sought an urgent interim relief as he has moved an
application under Order XXXIX Rules 1 and 2 CPC read with Order
XXXVIII Rule 5 CPC seeking attachment before judgment and was
thus not required to exhaust the remedy of pre-institution mediation.
Trial Court has also observed that whether the Court would ultimately
grant the relief or not will be considered on merits and this would not
be the causative factor to decide the issue of rejection of a plaint for
failure to take recourse to pre-institution mediation. In my view, no
infirmity can be found with the finding of the Trial Court and its
ultimate conclusion in rejecting the application, as the same are clearly
in consonance with the observations of the Division Bench in
Chandra Kishore Chaurasia (supra).
15. For all the aforesaid reasons, no merit is found in the revision
petition and the same is accordingly dismissed along with the pending
application.

JYOTI SINGH, J
MAY 31, 2023/kks/shivam

C.R.P. 150/2023 Page 11 of 11