Calcutta High Court
Swastik Project Pvt. Ltd vs City Enclave Pvt. Ltd & Ors on 1 March, 2021
Equivalent citations: AIRONLINE 2021 CAL 193
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GA No. 2 of 2021
CS 160 of 2020
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
COMMERCIAL DIVISION
SWASTIK PROJECT PVT. LTD
v.
CITY ENCLAVE PVT. LTD & ORS
For Applicant/ : Mr. Anindya Kumar Mitra, Sr. Advocate
Defendant No.1 Mr. Soumya Ray Chowdhury, Advocate
Mr. Sarvapriya Mukherjee, Advocate
Mr. Satadeep Bhattacharyya, Advocate
Mr. Surajit Biswas, Advocate
Mr. Arijeet Bera, Advocate
For Plaintiff : Mr. Jishnu Saha, Sr. Advocate
Mr. Aniruddha Mitra, Advocate
Mr. Swati Agarwal, Advocate
Mr. Ishan Saha, Advocate
Mr. Sujit Banerjee, Advocate
For the Defendant Nos. : Mr. Tarique Quasimuddin,Advocate
2&3 Mr. Abbas Ibrahim Khan, Advocate
Hearing concluded on : February 25, 2021
Judgment on : March 01, 2021
DEBANGSU BASAK, J. :-
1. The defendant No. 1 has applied for revocation of leave
granted under Order II Rule 2 of the Code of Civil Procedure, 1908
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and Section 12A of the Commercial Courts Act, 2015. The
defendant No. 1 has also applied for the plaint to be taken of the file
and returned to the plaintiff for filling before the appropriate court.
2. Learned Senior Advocate appearing for the defendant No. 1
has submitted that, the dispute involved in the suit cannot be a
"commercial dispute" within the meaning of the Commercial Courts
Act, 2015. He has submitted that, the plaintiff has stated that the
building cannot be commercially utilized and exploited at paragraph
32 of the plaint. He has drawn the attention of the Court to various
paragraphs of the plaint. He has submitted that, paragraph 36 of
the plaint, where, the plaintiff has claimed that the disputes come
within the meaning of the Act of 2015 is incorrect in the sense that,
there is an incorrect quotation of the Section sought to be attracted.
He has submitted that, the relevant clause would be Clause (vii) of
Section 2 (1)(c), of the Act of 2015. According to him taking the
averments made in paragraph 36 of the plaint to be true and
correct, then also there is no agreement relating to an immovable
property used exclusively in trade and commerce. He has relied
upon 2019 SCC online SC 1311 (Ambalal Sarabhai Enterprises
Limited v. K.S Infraspace LLP & Anr.) and submitted that, the
provisions of the Act of 2015 have to be strictly construed.
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3. Learned Senior Advocate for the defendant No. 1 has
submitted that, the averments in the plaint are relevant to confer
jurisdiction. On the basis of such averments, the disputes involved
in the suit cannot be said to be commercial dispute within the
meaning of the Act of 2015. He has submitted that, the expression
"used" in Section 2 (1)(c)(vii) must mean "actually used" or "being
used". In the facts of the present case, it cannot be said that the
building concerned is actually used or being commercially used.
According to him, the instant suit is for eviction of the defendants
and cannot be treated to come within the ambit of a commercial
dispute under the Act of 2015. Consequently, he has submitted
that the plaint should be returned to the plaintiff for presentation
before the appropriate forum.
4. Learned Senior advocate appearing for the plaintiff has drawn
the attention of the Court to the various averments made in the
plaint including paragraph 1 thereof. He has submitted that, the
plaintiff is engaged in the development of real estate property. He
has submitted that, the development agreement was entered into
with the plaintiff. The plaintiff has not been able to continue with
the development agreements since the defendant No. 1 had
trespassed into the property and is refusing to vacate the same. He
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has submitted that, the plaintiff had obtained sanction of the
building plan as a commercial building. However, such sanction
had expired. According to him, there being a development
agreement in respect of the immovable property concerned in the
suit, the same comes within the Clause (vi) of Section 2 (1)(c) of the
Act of 2015. He has relied upon the Explanation to Section 2(1)(c) of
the Act of 2015. He has submitted that, merely because the plaintiff
has prayed for possession of any immovable property the same does
not make the suit a non-commercial one. In such circumstances he
has submitted that, the application of the defendant No. 1 should
be dismissed.
5. All disputes of commercial nature are not commercial disputes
within the meaning of the Act of 2015. Disputes of commercial
nature which are to be construed and treated as commercial
disputes within the meaning of the Act of 2015 have been defined in
Section 2 (1)(c) thereof. The statements of objects and reasons in
the Act of 2015 has specified that the Act of 2015 is to provide
speedy disposal of high value commercial disputes.
6. The Supreme Court has considered Section 2 (1)(c)(vii) of the
Act of 2015 in Ambalal Sarabhai Enterprises Limited (supra). In
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the facts of that case, a suit had been filed before the Commercial
Court. The defendant therein had claimed that the disputes
involved in the suit cannot be termed as a commercial dispute
within the meaning of Section 2(1)(c) of the Act of 2015. In the facts
of that case, the plaintiff had entered into an agreement to sale an
immovable property in favour of one of the defendants to the suit.
Such defendant had assigned and transferred its rights under the
agreement in favour of the other defendant by executing a deed of
assignment. A conveyance had ultimately been executed. However,
since certain aspects had to be completed regarding the change
relating to the nature of use of the land for conclusion of the
transaction, a memorandum of understanding had been entered
into between the parties to the suit. A mortgage deed had to be
executed by one of the defendants in favour of the plaintiff. A
mortgage deed had been executed but the same was not registered.
In such circumstances, the plaintiff had filed the commercial suit so
as to enforce the execution of a deed of mortgage. It is in this
factual background that the Supreme Court has held that, the
disputes arising out of the agreement relating to the immovable
property are not commercial disputes within the meaning of the Act
of 2015.
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7. Ambalal Sarabhai Enterprises Limited (supra) has
considered AIR 2017 Gujarat Page 153 (Vasu Healthcare Pvt.
Ltd. v. Gujarat Akruti TCG Biotech Ltd.) and 2000 Volume 6
Supreme Court Cases page 550 (FEDERATION OF A.P
CHAMBERS OF COMMERCE & INDUSTRY AND OTHERS V.
STATE OF A.P AND OTHERS.).
8. In Vasu Healthcare Pvt. Ltd. (supra), the Gujarat High Court
has considered a suit for specific performance of an agreement. In
the facts of that case, the parties to the suit had agreed that, after
getting the plots on lease from Gujarat Industrial Development
Corporation, the same had to be developed by the original
defendant No. 1 and the same had to be given to other persons like
the original plaintiff. According to the plaintiff in that suit, the
original defendant No. 1 had failed to provide any infrastructural
facilities and develop the plots and therefore, the plaintiff had filed
the suit for specific performance with alternative progress. In such
factual background the Court had held that it cannot be said that
the agreement is as such relating to immovable property used
exclusively in trade or commerce. It has held that, while
interpreting a particular statute, the literal and strict interpretation
has to be applied. It has held that, on plain reading of Clause (vii) of
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Section 2(1)(c) of the Act of 2015, it is clear that the expression
"used" must mean "actually used" or "being used".
9. In the facts to the present case, the plaintiff has relied upon
two clauses of Section 2(1)(c) of the Act of 2015 namely Clause (vi)
and Clause (vii) to claim that the dispute is a commercial dispute
within the meaning of the Act of 2015.
10. Section 2(1)(c)(vi) and (vii) are as follows :-
"2. Definition. - (1) In this Act, unless the context
otherwise requires,-
(c) "Commercial Dispute" means a dispute arising out
of the
................
(vi) construction and infrastructure contracts, including tenders;
(vii) Agreements relating to immovable property used exclusively in trade and commerce;"
................
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 or monies out of immovable 8 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;"
11. Ambalal Sarabhai Enterprises Limited (supra) has held that, the nature of the dispute and jurisdiction to try the same has to be reflected in the suit itself since in a civil suit the pleadings, namely, averments in the plaint would at the outset be relevant to confer jurisdiction. The averments of the plaint in this suit has to be considered to find whether the dispute involved is a commercial dispute or not.
12. The claim of the plaintiff has arisen out of a development agreement as the averments of the plaintiff goes. According to the plaintiff, the defendants are illegal occupiers whose presence in the immovable property has prevented the execution of the development agreement and therefore the defendants have to be evicted from the suit property. The development agreement is such that the plaintiff has to obtain vacant possession of the property and make a construction of a commercial building thereat. The plaintiff had 9 obtained a sanction plan from the Kolkata Municipal Corporation for construction of a commercial building. The sanction plan has however lapsed. In such circumstances, the development agreement can be said to a construction contract. As the explanation to Section 2(1)(c) has provided, commercial dispute shall not cease to be so merely because it also involves action for recovery of possession of an immovable property. The plaintiff has sought to enforce its rights emanating out of and in relation to the development agreement. In my view, the plaintiff has satisfied Section 2(1)(c)(vi) of the Act of 2015 and therefore, the suit can be said to involve a commercial dispute within the meaning of the Act of 2015.
13. The plaintiff has referred to and relied upon a sanctioned plan in respect of the immovable property concerned. A copy of the sanctioned plan has been annexed to the plaint. The sanctioned plan as annexed to the plaint demonstrates that, sanctioned of the immovable property for construction at the immovable property concerned had been obtained as a commercial building. However, such sanctioned plan has expired. According to the plaintiff, it is by reason of the defendant's wrong doing that the sanctioned to the building plan had expired.
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14. The development agreement coupled with the sanctioned plan as a commercial building, in my view, are aspects that establishes that the immovable property concerned is being used exclusively in trade and commerce.
15. In view of such finding, I am not in a position to allow the application of the defendant No. 1.
16. IA GA No. 2 of 2021 is dismissed without any order as to costs.
[DEBANGSU BASAK, J.]