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2026 DIGILAW 94 (RAJ)

Mohsin Samdani S/o Late Riyaj Ahmad Samdani v. Sajjad Hussain Damami S/o Abdul Wahid Damami

2026-01-29

SANJEET PUROHIT

body2026
ORDER : SANJEET PUROHIT, J. 1. The present Civil Misc. Appeal has been filed under Order 43 Rule 1(a) CPC, challenging the order dated 02.05.2025 passed by Learned Additional District Judge No.7, Bikaner (“Learned Trial Court”) in Civil Original Suit No. 66/2024, whereby, while dealing with an application filed on behalf of respondents-defendants under Order 7 Rule 11 CPC, Learned Trial Court has held that the dispute involved in the suit is a “commercial dispute” covered within meaning of Section 2(1)(c)(vii) of the Commercial Courts Act, 2015 (“Act of 2015”) and, in exercise of its powers under Order 7 Rule 10 CPC, returned the plaint to be filed before Commercial Court of competent jurisdiction. 2. The subject-matter of the dispute is an agreement to sell dated 22.02.2024 entered into by the parties for sale of two shops (“suit premises”) situated at Khasra No. 831, Bikaner Housing Co- operative Society Limited, Mukta Prasad Nagar Road, in front of Saint N.N. School, Bikaner. 2.1 It is admitted in the plaint that appellants-plaintiffs have been carrying on their business from the suit premises and occupying the same in the capacity of tenants for over 10 years. Respondents-defendants approached appellants for selling the suit premises and the parties entered into the said agreement to sell for total consideration of Rs. 33 Lakhs, out of which, Rs. 3 Lakhs were paid in advance on the date of execution of the agreement and the rest was to be paid on the execution and registration of sale deed by respondents. 2.2 It is stated that, as per the terms of the said agreement to sell, respondents were under obligation to execute a sale deed within six months from the date of execution of agreement to sell, however, the same has not been done. It is submitted that appellants served a legal notice upon the respondents on 23.09.2024, calling upon them to comply with the agreement, in reply to which respondents have refused to perform their obligations. 2.3 Based on the said pleadings, appellants filed the suit for specific performance of the said agreement to sell, as well as prayed for mandatory and prohibitory injunction against the respondents. 2.3 Based on the said pleadings, appellants filed the suit for specific performance of the said agreement to sell, as well as prayed for mandatory and prohibitory injunction against the respondents. 2.4 After service of notice, an application under Order 7 Rule 11 read with Section 151 CPC was filed on behalf of the respondents, questioning the maintainability of suit on the ground of suit valuation, so also the ground that suit is barred by law. It is stated in the said application that the suit valuation mentioned in the plaint as well as the court fees paid are not in accordance with the provisions of Rajasthan Court Fees and Suit Valuation Act, 1961, thus, the suit is liable to be rejected under Order 7 Rule 11(b). The objection under Order 7 Rule 11(d) was also raised. 2.5 The application was contested on behalf of appellants, stating therein that the details in respect of suit valuation as mentioned in para 15 of the plaint are wholly justified. It was further stated that even otherwise, the said issue can only be decided after evidence is led by both parties, therefore, the present application is not maintainable. It is also stated in the said reply that although objection regarding suit being barred by law has been taken, however, it has not been specified in the application as to how the present suit is barred by any law. 2.6 During the course of arguments, it was contended on behalf of respondents that the subject matter of suit is an agreement relating to the sale of suit premises which admittedly have been used by appellants for the purpose of their trade and business, and, therefore, the dispute is a commercial dispute under the Act of 2015 and cannot be tried by Civil Court and is required to be transferred to Competent Commercial Court. 2.7 Learned Trial Court considered the definition of commercial dispute as provided under section 2(1)(c)(vii) of the Act of 2015, so also the judgments relied upon by respondents and held that, since the present suit is filed for specific performance of an agreement relating to immovable property that are being used for trade and commerce, therefore, the matter clearly falls within the definition of commercial dispute. In view of the mandate of Section 15 of the Act of 2015, Learned Trial Court observed that the suit cannot be tried by it and is required to be transferred to the Commercial Court of Competent Jurisdiction for adjudication. 2.8 In view of the said observations, learned trial Court vide its order dated 02.05.2025, while exercising its powers under Order 7 Rule 10 CPC, has returned the plaint to be filed before Commercial Court of competent jurisdiction. And since Learned Trial Court concluded that the suit does not fall within its jurisdiction but that of Commercial Court, the issue regarding undervaluation/deficient court fees was also not decided by Learned Trial Court. 2.9 Challenging the said order dated 02.05.2025, the present Misc. Appeal has been filed. 3. Learned counsel for the appellants, Mr. Rakesh Kumar Chota, argued that the Act of 2015 was enacted with an object to provide speedy disposal of high-value commercial disputes, whereas the present suit is filed for specific performance of an agreement to sell and the same cannot be considered as a commercial dispute so as to be transferred to Commercial Court. 3.1 It is further argued that the order impugned is completely contrary to the very purpose and scheme of the Act of 2015, and merely because an immovable property is being used for trade and commerce, a suit for specific performance of an agreement relating to such property does not automatically become a commercial dispute. 3.2 Learned counsel for the appellants relied upon judgments passed in the cases of Sanjay Suganchand Kasliwal vs. Golden Dreams Buildcon Pvt. Ltd. [2023 SCC online Bom. 2469]; M/s Sandhya Hotels Pvt. Ltd. Hyd vs. Amritha Mishra, Secbad [COM. T.A. No.2 of 2017]; Shivraj Singh Rathore S/o Shri Tej Singh Rathod vs. Rani Geetika Kumari, W/o Late Shri Arun Singh [S.B. Civil Writ Petition No. 8853/2025]; SOPL Private Limited vs. Naveen Patel [MANU/DE/5202/2023]. 4. Countering the said submissions, learned counsel for the respondents, Mr. Tabish Samdani, argued that the order passed by learned trial Court is absolutely justified and in consonance with the provisions of the Act of 2015. 4. Countering the said submissions, learned counsel for the respondents, Mr. Tabish Samdani, argued that the order passed by learned trial Court is absolutely justified and in consonance with the provisions of the Act of 2015. 4.1 Learned counsel for the respondents stated that a plain reading of the definition of commercial dispute provided under section 2(1)(c)(vii) makes it clear that all disputes concerning an agreement relating to immovable property used exclusively for trade and commerce qualify as commercial disputes and, by virtue of the mandate of Section 15, the same can only be tried and adjudicated by Commercial Courts. 4.2 Learned counsel for the respondent in support of the said contention relied upon judgments passed in the cases of Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP & Anr. [ (2020) 15 SCC 585 ]; Vasu Healthcare Pvt. Ltd. vs. Gujarat Akruti TCG Biotech Ltd. (2017 SCC OnLine Guj. 724]; Virender Kumar vs. Rekha Bhayana [2022 SCC OnLine Del. 2678] 5. Heard learned counsel for the parties and have perused the material available on record. 6. The main issue involved in the matter at hand is whether a dispute arising out of an agreement to sell concerning property which is being used for trade and business qualifies as a commercial dispute under section 2(1)(c)(vii) of the Act of 2015. 7. Before proceeding to deal with the said issue, this Court considers it desirable to first refer to the definition of commercial dispute as provided under Section 2(1)(c)(vii) of the Act of 2015. To the extent relevant, the said section is extracted here under: - “2. Definitions.—(1) In this Act, unless the context otherwise requires - (a)-(b) (c) “commercial dispute” means a dispute arising out of - (i)-(vi) (vii) agreements relating to immovable property used exclusively in trade or commerce; (viii)-(xxii)” A plain reading of the above-quoted provision makes it clear that any dispute arising out of an agreement relating to immovable property which is being used exclusively in trade and commerce will constitute a commercial dispute. Therefore, the only issue which requires determination by this court is whether the suit premises, i.e., the said two shops, for the sale of which the parties entered into the agreement to sell dated 22.02.2024, can be said to have been used exclusively for trade or commerce. 8. Therefore, the only issue which requires determination by this court is whether the suit premises, i.e., the said two shops, for the sale of which the parties entered into the agreement to sell dated 22.02.2024, can be said to have been used exclusively for trade or commerce. 8. In this regard, learned counsel for the respondents placed reliance upon Vasu Healthcare Pvt. Ltd. vs. Gujarat Akruti TCG Biotech Ltd. (Supra), the relevant paras of which are reproduced as follows: - “33…Considering section 2(c)(vii), “commercial dispute” means a dispute arising out of the agreements relating to immovable property used exclusively in trade or commerce… On plain reading of the relevant clause it is clear that the expression “used” must mean “actually used” or “being used”. If the intention of the legislature was to expand the scope, in that case the phraseology used would have been different as for example, “likely to be used” or “to be used”. The word “used” denotes “actually used” and it cannot be said to be either “ready for use” or “likely to be used”; or “to be used”. Similar view has been taken by the Bombay High Court (Nagpur Bench) in the case of Dineshkumar Gulabchand Agrawal (Supra) and it is observed and held that the word “used” denotes “actually used” and not merely “ready for use”. It is reported that SLP against the said decision has been dismissed by the Hon'ble Supreme Court. 34…Merely because the ultimate use might be for the purpose of trade or commerce and that too after developing and establishing Biotech Park after providing of infrastructural facilities, section 2(c)(vii) shall not be applicable, more particularly with respect to the agreement/ contract between the original plaintiff and the original defendant No. 1. It cannot be said that the agreement between the original plaintiff and the original defendant No. 1 is the agreement relating to immovable property used exclusively in trade or commerce.” 9. It is pertinent to note that the Hon’ble Apex Court, in its judgment passed in the case of Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP & Anr (Supra), has approved the view expressed by the Hon’ble High Court of Gujarat in Vasu Healthcare Pvt. Ltd. (Supra) and held: - “11. It is pertinent to note that the Hon’ble Apex Court, in its judgment passed in the case of Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP & Anr (Supra), has approved the view expressed by the Hon’ble High Court of Gujarat in Vasu Healthcare Pvt. Ltd. (Supra) and held: - “11. On the other hand, the learned senior advocate for the respondents has relied on the decision of a Division Bench of the Gujarat High Court in the case of Vasu Healthcare Private Limited vs. Gujarat Akruti TCG Biotech Limited, AIR 2017 Gujarat 153 wherein a detailed consideration has been made and the conclusion reached therein by taking note of an earlier decision is that on a plain reading of Clause 2(1)(c) of CC Act, 2015 the expression “used” must mean “actually used” or “being used”. It is further explained that if the intention of the legislature was to expand the scope, in that case the phraseology “likely to be used” or “to be used” would have been employed… 12. Though we are informed that the said decision is assailed before this Court in a Special Leave Petition we are inclined to agree with the view expressed therein… 37. A dispute relating to immovable property per se may not be a commercial dispute. But it becomes a commercial dispute, if it falls under sub-clause (vii) of section 2(c)(vii) of the Act viz. “the agreements relating to immovable property used exclusively in trade or commerce”. The words “used exclusively in trade or commerce” are to be interpreted purposefully. The word “used” denotes “actually used” and it cannot be either “ready for use” or “likely to be used” or “to be used”. It should be “actually used”. Such a wide interpretation would defeat the objects of the Act and the fast tracking procedure discussed above.” 10. Learned Counsel for the respondent has further placed reliance upon Virender Kumar vs. Rekha Bhayana (Supra), wherein the Hon’ble Delhi High Court, in respect of section 15 of the Act of 2015 and the powers under Order 7 Rule 10 CPC, following the ratio laid down in Ambalal Sarabhai Enterprises Ltd. (Supra), has held as follows: “9. The implication of the words “pending”, as used in this section is readily understood by referring not only to sub- section (2) of Section 15 but also to the other sub-sections of the said Section. The implication of the words “pending”, as used in this section is readily understood by referring not only to sub- section (2) of Section 15 but also to the other sub-sections of the said Section. Seen in conjunction with the expression “has been constituted”, as employed in Section 15(2), it is clear that the intent of the legislature, in enacting the said provision is to cover all commercial suits, filed as non- commercial suits before the Civil Court in any district or area in respect of which a Commercial Court “has been constituted” on the date when the Commercial Courts Act came into force and was, therefore, “pending” on the said date. 14. Commercial Courts are different from non-Commercial Courts. If a commercial suit is instituted before a Civil Court, it is, clearly, instituted before a Court other than the Court before which it should have been instituted. Order VII Rule 10 (1), in such circumstances, directly comes into play and requires the suit to be returned to the plaintiff to be instituted before the appropriate Court, i.e., the Commercial Court.” 11. A combined reading of the relevant statutory provisions of the Act of 2015, particularly Section 2(1)(c)(vii), alongside the settled position of law as enunciated by the Hon'ble Supreme Court in Ambalal Sarabhai Enterprises Ltd. (Supra) and the Gujarat High Court in Vasu Healthcare Private Limited (Supra) makes it abundantly clear that the 'actual use' of the property for trade or commerce is the sine qua non for qualifying a dispute as 'commercial' in nature. In Ambalal Sarabhai Enterprises Ltd. (Supra), the Hon’ble Supreme Court has established an acid test under which it is to be seen that the property must be in active use for trade or commerce at the time of dispute and the agreement must refer to property "actually used" and not merely "likely to be used". When facts establish that the suit property is being used for trade and business purposes at the time of the dispute, the jurisdiction of regular Civil Court is strictly ousted. Moreover, it also becomes clear that when a commercial dispute is filed in a civil court, the suit must be returned in exercise of the powers under Order 7 Rule 10 CPC, as laid down in Virender Kumar vs. Rekha Bhayana (Supra). 12. Moreover, it also becomes clear that when a commercial dispute is filed in a civil court, the suit must be returned in exercise of the powers under Order 7 Rule 10 CPC, as laid down in Virender Kumar vs. Rekha Bhayana (Supra). 12. Therefore, based on this established legal framework, this Court finds that learned trial court was perfectly justified in concluding that the matter is a commercial dispute and the same must be adjudicated by competent Commercial Court. Moreover, it is also settled position of law that at the stage of Order 7 Rule 10, learned court is required to consider only the averments made in the plaint and the documents filed by plaintiff. A perusal of the record shows that appellants have admitted in the plaint that they have been using the suit premises for the purposes of their trade and commerce for the last more than 10 years. It is also admitted that as a matter of fact, when the parties entered into the said agreement to sell in respect of the suit premises, appellants were in possession of the shops as tenants and were using the same even then for their trade and commerce. Thus, the acid test as laid down by the Hon’ble Supreme Court in Ambalal Sarabhai Enterprises Ltd. (Supra) that the property to which the agreement relates must “actually be used” and not “likely to be used” stands satisfied. There remains no doubt that the dispute concerning the specific performance of the agreement relating to sale of suit premises is a commercial dispute and must be adjudicated by competent Commercial Court. This Court thus finds that learned trial court has rightly returned the plaint to appellants to file the same before the Competent Commercial Court. 13. It is well-settled that observations in a judgment must be read in the context of the facts of that particular case. For a judgment to operate as a precedent, it must be shown that the precise question was raised, argued and decided. A mere observation or a decision on a question of fact does not constitute a binding precedent. 14. We have carefully perused the judgments relied upon by learned counsel for the appellants. In our considered view, the said decisions do not lend any assistance to the case of appellants. A mere observation or a decision on a question of fact does not constitute a binding precedent. 14. We have carefully perused the judgments relied upon by learned counsel for the appellants. In our considered view, the said decisions do not lend any assistance to the case of appellants. The legal principles laid down therein were rendered in a completely different factual matrix which is distinguishable from the facts of the present case. i. So far as the case of Sanjay Suganchand Kasliwal (Supra) is concerned, the same involved a complex Memorandum of Understanding (MOU) for a development project, leading to a debate on whether it fell under clause (vi) (construction contracts) or clause (vii) (immovable property) of Section 2(1)(c). In the present matter, the dispute arises from a straightforward agreement to sell concerning shops that are already in commercial operation, leaving no ambiguity regarding the applicability of the "actual use" criteria. ii. So far as the case of M/S. Sandhya Hotels Pvt. Ltd. (Supra) is concerned, there it was held that if the underlying agreement does not explicitly state that property is to be used for commercial purposes, and if such use is not immediately apparent from the nature of the property itself, the dispute remains a regular civil suit. In the present case, it is an admitted fact that appellants have been running their business from the subject shops for last 10 years. iii.So far the case of SOPL Private Limited vs. Naveen Patel (Supra) is concerned, therein was involved ambiguity in relation to the use of subject property, unlike in the present case. iv. And, lastly, in relation to Shivraj Singh Rathore vs. Rani Geetika Kumari (Supra), reliance placed thereupon by appellants seems entirely misconceived. The ratio of the said case supports the decision of learned trial court in the present case as it was held that when a defendant files an application under Order 7 Rule 11 on the grounds of lack of jurisdiction, the Court is not bound to reject the plaint if the defect is one that can be cured by returning the plaint to proper court. 15. 15. Thus, this Court finds that no error has been committed by Learned Trial Court in holding that it did not have jurisdiction to entertain the suit for specific performance of the said agreement to sell and in returning the plaint, in exercise of its power under Order 7 Rule 10 CPC, to be presented before competent commercial court. 16. Appellants have failed to make out a case that would warrant the interference of this court and, consequently, the appeal, being devoid of any merit, is hereby dismissed and the order of Learned Trial Court is upheld. 17. Stay application and all other pending application(s), if any, also stand dismissed accordingly.