ABP Private Limited v. Signet Media Service Private Limited
2024-04-24
APURBA SINHA RAY
body2024
DigiLaw.ai
JUDGMENT : Apurba Sinha Ray, J. 1. The learned counsel appearing for the judgment-debtor has argued that originally, the suit was filed in Ordinary Original Civil Jurisdiction of this High Court in 2019 but, according to him, it should have been filed in the Commercial Division since the relevant provisions under Commercial Courts Act, 2015 have come into force from the year 2015. According to him, initially a decree was passed on consent of the parties and the amount of such consent decree was approximately Rs. 6 crores. The judgment-debtor paid about Rs. 3 crores. However, as the judgment-debtor was unable to pay the entire amount, the instant execution proceeding has been launched. 2. The learned counsel has further pointed out that during the pendency of the execution proceeding, it appears to him that the learned Trial Court had no jurisdiction to pass the relevant decree on 06.01.2020. The learned counsel has further pointed out that there was a jural relationship between the parties and from the materials on record it would be evident that there was commercial transaction between the concerned parties on the basis of oral contract. The judgment-debtor’s status was recognized by the Indian Newspaper Service. 3. It is also argued from the side of the judgment-debtor that Section 2(c)(xiv) of Commercial Courts Act, 2015 deals with the Commercial dispute and under sub-section 2(c)(xiv) it is laid down that a dispute arising out of mercantile agency and mercantile usage should be treated as a commercial dispute. As there was a contractual relationship between the parties at the relevant point of time the dispute is a commercial one and therefore the relevant suit should have been filed before the Commercial Division of the High Court instead of its Ordinary Original Jurisdiction. 4. The learned counsel has also drawn attention of this court to Sections 7, 15(1) and (2) and also Section 21 of the Commercial Courts Act, 2015. According to him, as per section 7 of the Act, 2015, it has been laid down that all suits and obligations relating to a commercial disputes of a specified valued filed in a High Court having Ordinary Original Civil Jurisdiction shall be heard and disposed of by the Commercial Division of that High Court.
According to him, as per section 7 of the Act, 2015, it has been laid down that all suits and obligations relating to a commercial disputes of a specified valued filed in a High Court having Ordinary Original Civil Jurisdiction shall be heard and disposed of by the Commercial Division of that High Court. As the relevant suit being CS No. 182 of 2019 has been filed long after coming into force of the Act, 2015, the learned Trial Court did not have the jurisdiction to try the suit involving commercial dispute of a specified value. 5. The learned counsel has also pointed out that under Section 15(1) of the Act 2015, the suit being CS No. 182 of 2019 should have been transferred to the Commercial Division of the High Court but that was not done in this case rather the learned Trial Court proceeded with the suit in violation of provisions of Commercial Courts Act, 2015. In this regard, the learned counsel has referred to a judicial decision reported in (2023) 1 SCC 549 (Jaycee Housing Private Limited & Ors. Vs. Registrar (General), Orissa High Court, Cuttack & Ors.) in support of his contention that as per Section 15 of 2015 Act all suits and applications relating to a commercial dispute of specified value shall have to be transferred to the commercial court. Further, as per Section 21 of 2015 Act, it has the overriding effect. It provides that save and otherwise provided the provisions of the Act, 2015 shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. 6. The learned counsel has also drawn the attention of this court to an unreported decision passed by the Hon’ble Co-ordinate Bench of this Court in CS No. 23 of 2015 (Dr. Dilip Chaudhury Vs. Pratishruti Projects Limited & Ors.) wherein the Hon’ble Judge has been pleased to explain the position of the law in connection with the Act, 2015 and also so far as regards the suits to be dealt with under Section 15. In paragraph 19, it has been specifically observed that sub-section 5 of Section 15 contemplates a situation where suit or an application is not transferred in the manner specified in sub-section (1) or (2) or (3).
In paragraph 19, it has been specifically observed that sub-section 5 of Section 15 contemplates a situation where suit or an application is not transferred in the manner specified in sub-section (1) or (2) or (3). In such a situation the parties to the suit can approach the Commercial Division of the High Court to have the suit or application withdrawn from the court before which it is pending and transferred the same for trial or disposal to the commercial division or commercial courts having territorial jurisdiction of such suit. 7. According to learned counsel of the judgment-debtor the above directions are mandatory and, therefore, this execution proceeding should be transferred to the commercial division. The learned counsel Mr. Dutta has further suggested that the petitioner should withdraw the instant proceeding and file the same before the Commercial Division. 8. The learned Counsel Mr. Ghose appearing for the decree-holder has submitted that executing court cannot go beyond the decree. It is not a commercial dispute and further the suit is not a commercial suit. The decree was passed in a non-commercial suit on consent. Judgments cited by the judgment-debtors are all in respect of suit. 9. The learned counsel has further argued that there is no inherent lack of jurisdiction in this case. According to him, only territorial jurisdiction is the inherent lack of jurisdiction. Lack of pecuniary jurisdiction is not an inherent lack of jurisdiction. It is further argued by the learned counsel that the judgment-debtor is not claiming that the decree is void or nullity or there is an inherent lack of jurisdiction. 10. The learned counsel of the decree-holder has drawn the attention of this court to Section 2(c)(i) of Commercial Courts Act, 2015 wherein it has been provided that commercial dispute means a dispute arising out of ordinary transaction of mercantile agents, bankers, finance and traders, such as, those relating to mercantile documents including enforcement and interpretation of such documents. Section 182 of Indian Contract Act, 1872 defines mercantile agent whereas Section 2(9) of Sale of Goods Act, 1930 deals with the mercantile usage. The attention of the Court was drawn to the Oxford Dictionary as well as P. Ramanatha Aiyar’s Advanced Law Lexicon wherein the above terms have been defined. The terms of settlement were signed by the judgment-debtor.
Section 182 of Indian Contract Act, 1872 defines mercantile agent whereas Section 2(9) of Sale of Goods Act, 1930 deals with the mercantile usage. The attention of the Court was drawn to the Oxford Dictionary as well as P. Ramanatha Aiyar’s Advanced Law Lexicon wherein the above terms have been defined. The terms of settlement were signed by the judgment-debtor. According to the learned counsel, the recovery of the advertisement charges is not like selling of goods etc. The transactions were taken place between the principal to principal and not principal to agent or vice versa. Neither party is agent of the others. It is not a case of an agency nor there is any mercantile dispute. Therefore, according to him, there is no commercial dispute as per Section 2(c)(i) or 2(c)(xiv). The dispute involving publication of advertisement in a newspaper or any dispute arising out of such transaction cannot be treated as a commercial dispute as per provisions of the Act. 11. The learned counsel of the decree-holder has further argued that decree-holder is not a mercantile agent nor a business house nor there is any question of mercantile usage. The judgment-debtor accepted the jurisdiction and signed the documents including agreement papers. By referring to the internal page 2 of the decree the learned counsel of the decree-holder has argued that it shows that the judgment-debtor submitted to the decision of the court and further judgment-debtor has acted upon the decree and made part payment. 12. The learned counsel Mr. Ghose has further contended that the learned counsel Mr. Datta appeared in the proceeding before the learned trial court but did not raise the point of jurisdiction or the point that cause is a commercial one. The judgment-debtor cannot be allowed to approbate and reprobate. 13. By citing the judicial decisions reported in (2020) 15 SCC 585 (Ambalal Sarabhai Enterprises Limited Vs. K.S. Infraspace LLP & Anr.), the learned counsel tried to impress upon this court that only commercial disputes can be tried in the commercial courts, and the case in our hand does not belong to the category of commercial dispute. The learned counsel of the decree-holder has submitted that all transactions are not commercial transactions. By placing reliance on (1972) 2 SCC 442 (Amar Chandra Chakraborty Vs.
The learned counsel of the decree-holder has submitted that all transactions are not commercial transactions. By placing reliance on (1972) 2 SCC 442 (Amar Chandra Chakraborty Vs. The Collector of Excise, Government of Tripura & Ors.), the learned counsel has tried to argue that the word ‘application’ in Section 7 should be read as suit in view of maxim ‘ejusdem generis’. The ‘application in suit’ does not include execution application. The learned counsel has also relied upon (2021) SCC OnLine Cal 1457 (Laxmi Polyfab Pvt. Ltd. Vs. Eden Realty Ventures Pvt. Ltd. & Anr.) to fortify his argument that the decree-holder cannot be non-suited now, particularly when the judgment-debtor participated in the proceedings. The learned counsel has further pointed out that the term ‘application in suits’ under Section 7 of the Commercial Courts Act, 2015 does not include execution application. 14. The learned counsel Mr. Ghose has strenuously argued that execution proceeding is not the continuation of a suit rather it is an independent proceeding. The limitation Act, 1963 provides a separate chapter for execution. Section 5 of the Limitation Act, 1963 has no application in the execution proceeding since it is an original proceeding. In this regard, he has referred to the juridical decision reported in (2019) 6 SCC 424 (Karnataka Housing Board Vs. K.A. Nagamani). The execution application can be filed either in the Commercial Division or Ordinary Original Civil Jurisdiction therefore there is no illegality in filing the instant execution proceeding in the Original Civil Jurisdiction of this court. The two judgments relied upon by the judgment-debtor are not applicable to the factual matrix of the instant case. 15. In reply, Mr. Datta has argued that this a commercial dispute as per Section 2(c)(xiv) of the Act, 2015 since there are sufficient materials to show that there was mercantile usage in the relevant transaction between the parties. He has also strenuously argued that if any transaction occurs for commercial purpose the transaction is a commercial one. By referring page 45 para 18 of the plaint the learned counsel has drawn the attention of this court to show that it has been mentioned therein by the plaintiff/decree-holder that the transaction between the parties are all commercial nature.
He has also strenuously argued that if any transaction occurs for commercial purpose the transaction is a commercial one. By referring page 45 para 18 of the plaint the learned counsel has drawn the attention of this court to show that it has been mentioned therein by the plaintiff/decree-holder that the transaction between the parties are all commercial nature. If that be so sections 7 and 15 are squarely applicable to the instant proceeding and there is no doubt that the Ordinary Original Civil Jurisdiction of this court cannot be used for dealing with a commercial dispute under the Act, 2015. 16. The learned counsel has also argued that harmonious construction of relevant provisions of a statute is to be taken into consideration and further purposive construction is to be adopted. The Hon’ble Supreme Court has also placed reliance upon the provisions as laid down in Section 15 of the Act, 2015. Court’s View:- 17. Needless to mention that the executing court can interfere with the relevant decree only when the decree is a nullity or when there is an inherent lack of jurisdiction. Further, it is settled law that objection to the jurisdiction of a court is to be raised at the very outset of the proceedings and preferably before the framing of issues. 18. However, it appears that the judgment-debtor has participated in CS No. 182 of 2019 and did not raise any objection as to the jurisdiction of the court rather signed the terms of the settlement concluded between the parties and persuaded the learned Trial Court to pass a decree on consent of the parties. Thereafter, it made part payment of the decree. However, when it failed to comply its final obligation, the instant execution proceeding case was started. The judgment-debtor has now taken the plea that the learned Trial Court did not have the jurisdiction in view of the provisions of Commercial Courts Act, 2015 and, therefore, the decree cannot be executed. I have considered the judgments referred to by the learned counsels of the parties. In this regard, I think it would be appropriate at this stage to consider when the plea of lack of jurisdiction can be raised in an execution proceeding.
I have considered the judgments referred to by the learned counsels of the parties. In this regard, I think it would be appropriate at this stage to consider when the plea of lack of jurisdiction can be raised in an execution proceeding. Needless to mention, the relevant law has been crystallized by several judicial decisions of the Hon’ble Supreme Court wherein it has been laid down that the plea of lack of inherent jurisdiction can be set up whenever and wherever the decree is sought to be enforced and invalidity of the decree can be set up even at the stage of execution or even in collateral proceeding. In this regard, the judicial decision reported at (1977) 2 SCC 662 (Sunder Dass Vs. Ram Prakash) can be referred to. The Hon’ble Apex Court has been pleased to observe in the following manner:- “3. Now, the law is well settled that an executing court cannot go behind the decree nor can it question its legality or correctness. But there is an exception to this general rule and that is that where the decree sought to be executed is a nullity for lack of inherent jurisdiction in the court passing it, its invalidity can be set up in an execution proceeding . Where there is lack of inherent jurisdiction, it goes to the root of the competence of the court to try the case and a decree which is a nullity is void and can be declared to be void by any court in which it is presented. Its nullity can be set up whenever and wherever it is sought to be enforced or relied upon and even at the stage of execution or even in collateral proceedings. The executing court can, therefore, entertain an objection that the decree is a nullity and can refuse to execute the decree. By doing so, the executing court would not incur the reproach that it is going behind the decree, because the decree being null and void, there would really be no decree at all. Vide Kiran Singh v. Chaman Paswan and Seth Hiralal Patni V. Sri Kali Nath.
By doing so, the executing court would not incur the reproach that it is going behind the decree, because the decree being null and void, there would really be no decree at all. Vide Kiran Singh v. Chaman Paswan and Seth Hiralal Patni V. Sri Kali Nath. It is, therefore, obvious that in the present case, it was competent to the executing court to examine whether the decree for eviction was a nullity on the ground that the Civil Court had no inherent jurisdiction to entertain the suit in which the decree for eviction was passed. If the decree for eviction was a nullity, the executing court could declare it to be such and decline to execute it against the respondent.” 19. In (2019) 17 SCC 82 (Hindusthan Zinc Ltd. (HZL) Vs. Ajmer Vidyut Vitran Nigam Limited) the Hon’ble Apex Court has also laid down that inherent lack of jurisdiction of the court can be set up even in the execution proceeding. 20. In view of the above, there is no doubt that if there is an inherent lack of jurisdiction, the law of the land authorizes the judgment-debtor to take such plea in the execution proceeding. But to ascertain the answer regarding the query whether institution of a proceeding in the ordinary original civil jurisdiction, instead of commercial court, is an inherent lack of jurisdiction or not, the Hon’ble Apex Court’s observation in (2007) 13 SCC 650 Subhash Mahadevasa Habib Vs. Nemasa Ambasa Dharmadas (Dead) by LRS and Ors), is very much relevant:- “With reference to objections relating to territorial jurisdiction, section 21 of the Civil Procedure Code enacts that no objection to the place of suing should be allowed by an appellate or revisional court, unless there was a consequent failure of justice. It is the same principle that has been adopted in section 11 of the Suits Valuation Act with reference to pecuniary jurisdiction.
It is the same principle that has been adopted in section 11 of the Suits Valuation Act with reference to pecuniary jurisdiction. The policy underlying Sections 21 and 99 of the Civil Procedure Code and Section 11 of the Suits Valuation Act is the same, namely, that when a case had been tried by a court on the merits and judgment rendered , it should not be liable to be reversed purely on technical grounds, unless it had resulted in failure of justice, and the policy of the legislature has been to treat objections to jurisdiction both territorial and pecuniary as technical and not open to the consideration by an appellate court, unless there has been a prejudice on the merits.” 21. From the above it is transpired that when a case has been tried by a court on merits and judgment rendered, it should not be liable to be reversed purely on technical grounds unless it resulted in failure of justice and unless there has been a prejudice on the merits. There is no material on record to show how the judgment-debtor suffers injury on account of passing of the relevant decree particularly when such decree was passed on its consent. 22. Needless to mention, if the subject matter jurisdiction vests with the learned trial court, non-availability of pecuniary or territorial jurisdiction cannot be treated as inherent lack of jurisdiction of though at best it can be regarded as an irregularity. The Hon’ble Hgih Court has the power to deal with the disputes which may be commercial or contractual and therefore the subject matter jurisdiction is always with the Hon’ble High Court and as the subject matter jurisdiction lies with the Hon’ble High Court it, in strict sense, does not cause any prejudice, to the judgment-debtor since the matter has been disposed of in a civil jurisdiction on consent of the parties. In other words the judgment-debtor has failed to show any iota of prejudice caused to him due to passing of such decree on consent of the parties. 22.1. I have considered the decision reported at (2023) 1 SCC 549 Jaycee Housing Private Limited & Ors. Vs. Registrar (General), Orissa High Court, Cuttack & Ors.) cited by the learned counsel of the judgment-debtor. From the said case laws it appears that the Hon’ble Apex Court has been pleased to observe in para no.
22.1. I have considered the decision reported at (2023) 1 SCC 549 Jaycee Housing Private Limited & Ors. Vs. Registrar (General), Orissa High Court, Cuttack & Ors.) cited by the learned counsel of the judgment-debtor. From the said case laws it appears that the Hon’ble Apex Court has been pleased to observe in para no. 25 as hereunder:- “It is also required to be noted that even as per Section 15 of the 2015 Act, all suits and applications including applications under the 1996 Act, relating to a commercial dispute of specified value shall have to be transferred to the Commercial Court. Even as per Section 21 of the 2015 Act, the 2015 Act shall have overriding effect. It provides that save as otherwise provided, the provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force.” 23. In our case, it appears that the plea that the matter involved a commercial dispute was never raised before passing of the consent decree. It is further transpired that the judgment-debtor have complied with the decree in part. In the execution proceeding, it is for the first time the plea has been taken that the relevant suit should have been transferred to the Commercial Division of the High Court. The learned counsel of the judgment-debtor has also drawn the attention of this court to the unreported decision of Dr. Dilip Chaudhury Vs. Pratishruti Projects Limited & Ors. (supra) in support of his contention that it is the duty of the concerned court to transfer the relevant suit to the Commercial Court even if there is no such plea from the parties concerned. 24. I have gone through the above materials on record and in this regard I have already found that as the subject matter jurisdiction is with the Hon’ble High Court, in fact, no prejudice is caused to the parties, particularly, when they gave consent and persuaded the court to pass such a decree on consent. Be it mentioned that the judgment-debtor could have taken the plea under Section 15 sub-section 5 of the Commercial Courts Act, 2015 for transferring the said suit from the Ordinary Original Civil Jurisdiction to the Commercial Division of the High Court but that was not done by him. 24.1.
Be it mentioned that the judgment-debtor could have taken the plea under Section 15 sub-section 5 of the Commercial Courts Act, 2015 for transferring the said suit from the Ordinary Original Civil Jurisdiction to the Commercial Division of the High Court but that was not done by him. 24.1. Much arguments have been advanced from both sides to point out whether the dispute is a commercial one or not. Admittedly, there was an oral contract between the parties. To know the nature of contract i.e. whether it is a commercial or a non-commercial one, the intentions of the parties to such contract are to be looked into .But no material, supported by evidence, is found on the record to ascertain what were the exact terms of such oral contract. Without having such important materials on record, it is difficult at this stage to pin-point the nature of the contract, although in the facts and circumstances, and also in view of above discussion, such exercise has become redundant. 25. The learned counsel’s closing submission was that the decree-holder should withdraw the instant execution proceeding and file the same before the Commercial Division for execution. In this regard, I would like to mention that this Bench has been assigned to execute the decrees passed in commercial courts or commercial matters as well. In fact there is no impediment in true sense if the instant proceeding is being carried on before this court since this court has the determination to take up execution proceeding in respect of commercial matters, excepting arbitration. 26. Considering all aspects of the matter, I find that there is no strength of the judgment-debtor’s argument that the decree passed in Civil Suit No. 182 of 2019 cannot be acted upon in this forum. 27. Let the matter appear on 10.05.2024 (12:15 p.m.) for the examination of the Principal Officers of the judgment-debtor. 28. Urgent certified website copies of this judgment, if applied for, be supplied to the parties subject to compliance with all the requisite formalities.