Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015

This act provides for creation of commercial courts, commercial appellate courts and commercial divisions, at district level. The act also aims to support the Make in India campaign by boosting the ‘ease of doing business in India’. The act facilitates with enforcement of contracts, recovery of monetary claims and compensation to damages suffered under any of the investment or economic activities. Beside this, the act will surely help the judiciary by reducing the number of pending cases in the courts.

What is a Commercial dispute?

A commercial dispute is defined as a dispute arising out of matters related to payment default, or default in the delivery of goods and services, or any other matter related to transactions between merchants, bankers, financiers, traders, etc. Such transactions deal with mercantile documents, partnership agreements, intellectual property rights, etc.

Specified value of a dispute to be dealt by the court

The commercial disputes which will be dealt by the commercial division in high courts and commercial appellate should not be of value less than one crore rupees, and will be specified by the central government.

Commercial courts at the district level

The bill also has provision for the state governments to set up commercial courts, equivalent to district courts, at district level, after consulting with their respective state high courts. However, a commercial court cannot adjudicate in areas where the high court exercises ordinary original civil jurisdiction.

Commercial divisions in high courts

Unlike Commercial courts, Commercial divisions may be set up in those high courts which exercise ordinary original civil jurisdiction, that is, the High Courts of Delhi, Bombay, Calcutta, Madras and Himachal Pradesh. Commercial divisions will be set up by the Chief Justice of that particular High Court.

Commercial appellate divisions

Commercial appellate divisions can be set up in all high courts to hear appeals against: orders of commercial divisions of high courts; orders of commercial courts; and appeals arising from domestic and international arbitration matters that are filed before the high courts. Such commercial appellate divisions in high courts will be set up by the Chief Justice of that High Court.

Appointment of commercial court judges

The act empowers the state government to appoint one or more persons as judge(s) of the commercial court. The persons selected as judges must have experience in dealing with matters related to commercial disputes. The state government is required to consult with the Chief Justice of respective High Court before making any appointment of judges. The judges will be selected from amongst the cadre of Higher Judicial Services in the state.

Nomination of high court judges to the commercial divisions and appellate divisions

The commercial divisions will comprise of one or more Benches consisting of a single judge. The commercial appellate divisions will comprise of one or more benches consisting of two judges. All suits and applications relating to commercial disputes of a specified value filed in a High Court having ordinary original civil jurisdiction will be heard and disposed of by the commercial division of that High Court. The Chief Justice of the High Court will nominate those judges of high courts with experience of dealing with commercial disputes, as judges of commercial and appellate divisions of the court.

Filing and disposal appeals

Appeals to the commercial appellate divisions must be made within 60 days of the order of the lower court. The time limit for the commercial appellate division to dispose of the matter is of six months.

Infrastructure and training

The state government must provide the necessary infrastructure for the working of the commercial court or commercial division of a high court. The state government, in consultation with the High Court of the respective state, can set up training facilities for the commercial courts, commercial divisions and appellate commercial divisions of high court.

Transfer of pending suits

All suits of a value of Rs 1 crore or more than that pending in the high court will be transferred to the commercial division of the court. Similarly, suits which are of value of more than 1 crore, and are pending in district court, will be transferred to commercial court.

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