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2023 DIGILAW 501 (JK)

Raj Kumar v. Shiv Shakti Sai Satguru Kabir Bir

2023-09-13

SANJAY DHAR

body2023
ORDER : 1. By this common order aforetitled references made by the learned Principal District Judge, Jammu are proposed to be disposed of. 2. It appears that with the coming into force of Commercial Courts Act 2015 in the Union Territory of Jammu and Kashmir, five civil suits titled Balwant Singh and another Vs. Pooja Devi and others, New India Assurance Company Limited Jammu and another Vs. M/s New Star Goods Carrier Jammu and another, Jogesh Sharma Vs. Nathu Ram, Raj Kumar Vs. Shiv Shakti Sai Satguru Kabir Bir and others and Ghani Vs. Rakesh Kumar which were pending before the court of learned 1st Additional District Judge, Jammu were referred by the said court to Principal District Judge, Jammu in terms of identical orders passed on various dates with the recommendation that the said suits may be transferred to the court of Additional District Judge (Bank Cases) which has been designated as a Commercial court for District Jammu in terms of SO 47 dated 04.02.2020. 3. The reference was accepted by the learned Principal District Judge, Jammu in terms of different orders passed in aforetitled five suits passed on different dates and the suits came to be transferred to the court of Additional District Judge (Bank Cases) Jammu i.e. the Commercial Court, Jammu. The said court in terms of five different orders passed in the aforetitled five suits has referred the matter back to the Principal District Judge, Jammu with the observations that the aforetitled suits are not the commercial suits as defined under Section 2 (1) (c) of the Commercial Courts Act 2015. 4. The learned Principal District Judge, Jammu has, through the medium of this reference sought an opinion of this Court on the question as to whether the aforetitled five suits are to be tried by an ordinary Civil Court or by a Commercial Court. 5. 4. The learned Principal District Judge, Jammu has, through the medium of this reference sought an opinion of this Court on the question as to whether the aforetitled five suits are to be tried by an ordinary Civil Court or by a Commercial Court. 5. In order to determine as to whether the subject matter of the aforetitled five suits qualifies to be a commercial dispute, it would be apt to have a look at the definition of the “Commercial Dispute” as contained in Section 2 (1)(c) of the Commercial Courts Act, which is reproduced as under: “2(1)(c) “Commercial dispute means a dispute arising out of- (i) Ordinary transactions of merchants, bankers, financiers and traders such as those relating to mercantile documents, including enforcement and interpretation of such documents; (ii) Export or import of merchandise or services; (iii) Issues relating to admiralty and maritime law; (iv) Transactions relating to aircraft, aircraft engine, aircraft equipment and helicopters, including sales, leasing and financing of the same; (v) Carriage of goods; (vi) Construction and infrastructure contracts, including tenders; (vii) Agreements relating to immovable property used exclusively in trade or commerce; (viii) Franchising agreements; (ix) Distribution and licensing agreements; (x) Management and consultancy agreements; (xi) Joint venture agreements; (xii) Shareholders agreements; (xiii) Subscription and investment agreements pertaining to the services industry including outsourcing services and financial services; (xiv) Mercantile agency and mercantile usage; (xv) Partnership agreements; (xvi) Technology development agreements; (xvii) Intellectual property rights relating to registered and unregistered trademarks, copyright, patent, design, domain, names, geographical, indications and semiconductor integrated circuits; (xviii) Agreements for sale of goods or provision of services; (xix) Exploitation of oil and gas reserves or other natural resources including electromagnetic spectrum; (xx) Insurance and re-insurance; (xxi) Contracts of agency relating to any of the above; and (xxii) Such other commercial disputes as may be notified by the Central Government. Explanation--- A commercial dispute shall not cease to be a commercial dispute merely because--- (a) It also involves action for recovery of immovable property or for realisation of monies out of immovable property given as security or involves any other relief pertaining to immovable property; (b) One of the contracting parties is the State or any of its agencies or instrumentalities, or a private body carrying out public functions; 6. In the instant case, we are primarily concerned with the definition of commercial disputes as contained in Sub-clauses (i), (v) and (vii) quoted above. As per Sub-clause (i) Ordinary transactions of merchants, bankers, financiers and traders such as those relating to mercantile documents, including enforcement and interpretation of such documents would qualify to be a commercial dispute. The explanation to the definition of the Commercial Dispute provides that merely because the dispute involves action for recovery of immovable property or for realisation of monies out of immovable property given as security or involves any other relief pertaining to immovable property, it does not cease to be a commercial dispute. Thus, a transaction of four classes of persons, namely, merchants, bankers, financers and traders arising out of mercantile documents alone would fall within the definition of a commercial dispute. As per sub-clause (v), a dispute arising out of carriage of good falls under the definition of commercial disputes. Similarly, as per sub-clause (vii) a commercial dispute would be a dispute in respect of agreements relating to immovable property used exclusively in trade or commerce. 7. In light of the aforesaid legal position, let us now advert to the subject matter of the dispute involved in each of the aforetitled suits. 8. Balwant Singh and another Vs. Pooja Devi and others : The aforetitled suit is filed by the plaintiffs against the defendants seeking recovery of an amount of Rs. 7,00,000/-along with the interest. In this case, the claim of the plaintiffs against the defendants is that they had extended a loan of Rs. 7,00,000/- to the deceased husband of defendant No. 1as a financial help because the defendant No. 1 is their neighbour. The transaction between the plaintiffs and the defendants in this case cannot be termed as commercial dispute. Where a plaintiff gives a friendly loan to needy friend, it will not be seen as a transaction in the course of ordinary business. The subject matter of the dispute, therefore, does not qualify as a commercial dispute. The suit is, therefore, triable by an Ordinary Civil Court. 9. New India Assurance Company Limited Jammu and another Vs. M/s New Star Goods Carrier Jammu and another : The aforetitled suit is filed by the plaintiffs against the defendants seeking recovery of an amount of Rs. The suit is, therefore, triable by an Ordinary Civil Court. 9. New India Assurance Company Limited Jammu and another Vs. M/s New Star Goods Carrier Jammu and another : The aforetitled suit is filed by the plaintiffs against the defendants seeking recovery of an amount of Rs. 5,02,799/- from the defendants on account of loss caused to the goods that were being transported by the defendants under an agreement with the plaintiff No. 2. According to the plaintiff-Insurance Company, in terms of policy of insurance, plaintiff No. 2 has executed a letter of subrogation in its favour entitling it to recover the damage caused to the transported goods by the defendants. Thus the plaintiff No. 1 has stepped into the shoes of plaintiff No. 2 who had an agreement relating to carriage of goods with the defendants. Sub-clause (v) of the Clause (c) of Section 2(1) of the Commercial Courts Act defines commercial dispute as a dispute arising out of carriage of goods. Therefore, the subject matter of the suit is covered by the definition of commercial dispute and since the value of the subject matter of the suit is more that the specified value, as such, the suit is triable by the Commercial Court. 10. Jogesh Sharma Vs. Nathu Ram: The plaintiff in this case has sought recovery of an amount of Rs. 33,00,000/- from the defendant. The claim of the plaintiff is that he had entered into an agreement with the defendant for purchase of a space measuring 1800 Sq. Feet in a building that was to be constructed on Jammu-Pathankot National Highway at Kaluchak, Jammu, but the defendant failed to deliver the possession of the said space to the plaintiff. In terms of the agreement, he is seeking recovery of the aforesaid amount. 11. As per Sub-clause (vii) of Clause (c) of Section 2(1) of Commercial Courts Act, agreements relating to immovable property used exclusively in trade or commerce fall within the definition of commercial dispute. The subject matter of the dispute in the instant suit is a dispute in respect of an agreement relating to immovable property. It is not pleaded by the plaintiff that the property which is subject matter of the agreement is used in trade or commerce. In fact, it is not the case of the plaintiff that the property in question is likely to be used in trade or commerce. It is not pleaded by the plaintiff that the property which is subject matter of the agreement is used in trade or commerce. In fact, it is not the case of the plaintiff that the property in question is likely to be used in trade or commerce. Unless it is shown that the immovable property, which is subject matter of the agreement, is used in trade or commerce, a dispute relating to such agreement would not qualify to be a commercial dispute. Thus, the subject matter of this suit does not fall within the definition of commercial dispute. Accordingly, the suit is triable by an Ordinary Civil Court. 12. Raj Kumar Vs. Shiv Shakti Sai Satguru Kabir Bir and others: In this case the plaintiff is seeking recovery of an amount of Rs. 1,33,90,995/- from the defendants and the suit has been filed under Order 34 CPC read with Section 67 and 68 of Transfer of Property Act. The claim of the plaintiff is that he is seeking recovery of the suit amount on the basis of a mortgage deed by sale of mortgaged property. The case of the plaintiff is that he is a business man and he deals in business of real-estate. He has further pleaded that the defendant trust had borrowed money from him which carried interest at the rate of 1% per month. 13. Therefore, case of the plaintiff is that he has acted in the capacity of a financer and advanced loan to the defendant trust. The transaction between the plaintiff and the defendant trust was one relating to financing but for bringing the dispute within the purview of sub-clause (i) of clause (C) of S.2(1) of the Act of 2015, it is necessary to show that the transaction relates to mercantile documents. In the instant case, even though the subject matter of the suit relates to transaction of financer but it does not relates to mercantile documents. The subject matter of the dispute between the parties, therefore, does not fall within the definition of commercial dispute, as contained in Sub-Clause (i) of Clause (c) of Section 2(1) of the Commercial Courts Act. Therefore, the aforetitled suit is triable by an Ordinary Civil Court. 14. Ghani Vs. Rakesh Kumar: In this suit the plaintiff has sought recovery of an amount of Rs. 5,00,000/- from the defendant. Therefore, the aforetitled suit is triable by an Ordinary Civil Court. 14. Ghani Vs. Rakesh Kumar: In this suit the plaintiff has sought recovery of an amount of Rs. 5,00,000/- from the defendant. As per the claim of the plaintiff, he had advanced a loan of Rs. 5,00,000/- to the defendant as the defendant was in need of money. It is pleaded by the plaintiff that relations between the plaintiff and the defendant were cordial and it was for this reason that he agreed to advance a loan of Rs. 5,00,000/- to the defendant. Thus, the transaction between the plaintiff and the defendant cannot be termed as a commercial dispute. Where a plaintiff gives a friendly loan to a needy friend, it will not be seen as a transaction in the ordinary course of business. The same does not qualify to be a commercial dispute. The suit, therefore, is triable by an Ordinary Civil Court. 15. The references made by the learned District Judge are answered, accordingly. The learned District Judge shall transfer/assign the suits to appropriate courts in terms of the opinion rendered hereinabove. 16. A copy of this order be sent to the learned District Judge, Jammu for taking further course of action.