Delhi District Court
District Judge-05 (West) Tis Hazari ... vs M/S National Mri Scan Centre on 12 January, 2016
IN THE COURT OF SHRI KULDEEP NARAYAN : ADDITIONAL
DISTRICT JUDGE-05 (West) TIS HAZARI COURTS, DELHI
Execution No.30/14
Manohar Lal Sethi (now deceased) & Ors
....... Decree Holder
V.
M/s National MRI Scan Centre
...... Judgment Debtor
ORDER
12.01.2016 This order shall decide an application under Section 114 read with Order XLVII and Section 151 CPC moved on behalf of the judgment debtor (JD) seeking recall of the order dated 17.12.2015 passed by this court (for short, "the impugned order"). By way of the impugned order, an application under Section 151 CPC moved on behalf of the judgment debtor (JD) was dismissed and warrants of possession in respect of the ground floor of property no. 19/35, Punjabi Bagh, New Delhi as per site plan Ex.PW-1/2 (for short, "the suit property") was issued.
The grounds for recalling the impugned order are that the present case falls within the ambit of Section 2(c) sub-section (vii) of The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015 (for short, "The Ordinance"). Further, as per Section 12 sub-section (1)(c) of The Ordinance, the Specified Value of the suit property turned out to be approximately Rs.3,75,00,000/- as per the circle rates and, therefore, this court had no jurisdiction to adjudicate upon the application under Section 151 CPC vide Ex No. 30/14 Page 1/12 impugned order. It is prayed that the impugned order be recalled, the ongoing execution proceedings be stayed till the disposal of the application and matter be referred to the Hon'ble High Court of Delhi for adjudication.
2. The decree holder did not file reply to the application under consideration and argued straightway.
3. I heard arguments on both sides and perused the material available on record. During the course of arguments, Shri Mayank Bansal,Adv. counsel for the judgment debtor relied on judgment passed by HMJ Valmiki Mehta in case titled as Smt. Surinder Kaur V. Gurmit Singh & Ors. CS(OS) No. 3340.2015 decided on 06.11.2015. Shri Mayank Bansal, Advocate also relied on order dated 19.11.2015 passed by Dr. Kamini Lau, Ld. ADJ-II (Central) in case titled as MVM Developers V. Raghubir Singh Chhabra bearing CS No.296/2015 and Raghbir Singh Chhabra V.Holy Star Natural bearing CS No. 161/2014 - first for its binding nature and latter for its persuasive value.
4. The facts in a nutshell, are that the plaintiff/decree holder filed suit for recovery of possession of the suit property alongwith recovery of arrears of rent, use and occupation charges, damages/mesne profits against the defendant/judgment debtor titled as "Manohar Lal Sethi V. M/s National MRI Scan Diagnostic Centre" bearing CS No. 272/12. During the course of proceedings of the suit, the dispute was settled between the parties and a compromise decree dated 28.04.2014 was drawn. As per the said compromise decree, the defendant/judgment debtor agreed to hand over the peaceful and vacant possession of the suit property on or before 30.06.2015. The judgment debtor also agreed to pay certain amount on account of arrears of rent/damages. Since the judgment debtor failed to comply with the terms of compromise decree dated 28.04.2014 with regard Ex No. 30/14 Page 2/12 to the agreed payment schedule and to deliver the vacant and peaceful possession of the suit property, the plaintiff/decree holder filed an execution petition to recover the possession of the suit property as well a sum of Rs.7,70,290/- from the judgment debtor. During the course of proceedings of the present execution petition, one application dated 14.07.2015 was moved on behalf of the judgment debtor seeking appropriate directions to the decree holder to place on record their statement of account and to deposit the security amount in the court, which was earlier deposited by the judgment debtor with the decree holder. The aforesaid application was dismissed vide order dated 25.07.2015. Another application under Section 151 CPC dated 24.07.2015 was moved on behalf of the judgment debtor to which the decree holder also filed a reply. The afore-mentioned application under Section 151 CPC dated 24.07.2015 was dismissed as withdrawn by the judgment debtor. Further, he moved another application under Section 151 CPC dated 27.11.2015, which was dismissed vide the impugned order.
5. In order to appreciate the contentions of the counsel for the judgment debtor one by one, it would be appropriate to refer the relevant provisions of The Ordinance. The first contention of Shri Mayank Bansal, is that the present case falls within the ambit of Section 2(c) of The Ordinance. Section 2(1)(c) of The Ordinance is as under:
2. Definitions-(1) In this Ordinance, unless the context otherwise requires-
(a)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(b)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(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;Ex No. 30/14 Page 3/12
(ii) export or import of merchandise or services;
(iii) issues relating to admiralty and maritime law;
(iv) transactions relating to aircraft, aircraft-engines, 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 usages;
(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 realization of monies out of immovable property given as security or involves any other relief pertaining to immovable property;
(b)-(i)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Ex No. 30/14 Page 4/12
6. In view of the afore-mentioned provision, it is clear that the term "commercial dispute" means a dispute arising out of agreements relating to immovable property used exclusively in trade or commerce, that is to say, such agreement must be in respect of an immovable property, which is being used exclusively for trade and commerce. Undoubtedly, there may be different kinds of disputes relating to such immovable property, but only that immovable property, which is used exclusively for the purpose of trade and commerce can be the subject matter of a "commercial dispute" under Section 2(1)(c)(vii). As is clear from the definition itself, the thrust is on commercial nature of dispute, primarily concerned with conduct of trade and commerce. It is also clear from the other instances stipulated under Section 2(1)(c) i.e. from sub-section (i) to (xxii) stipulating about franchising agreements, distribution and licensing agreements, joint venture agreements, shareholders agreements, mercantile agency and mercantile usage, technology development agreements, partnership agreements, intellectual property rights etc. and other commercial disputes. The definitions of "commercial disputes" as provided under Section 2(1)(c) are amply demonstrative and self explanatory about the nature of a "Commercial Dispute", which is analogous to carry on mercantile trade and commerce activity.
7. Furthermore, the Explanation (a) appended to Section 2 of The Ordinance is also explicit, when it stipulates that a commercial dispute shall not cease to be a "Commercial Dispute" merely because it also involves actions for recovery of immovable property. To put it in other words, an action for recovery of immovable property may or may not be in a commercial dispute, but a commercial dispute will arise out of an agreement relating to immovable property used exclusively in trade and Ex No. 30/14 Page 5/12 commerce. Therefore, a commercial dispute may or may not be involving action for recovery of immovable property. Its existence is independent in a case and is certainly not dependent upon the action for recovery of immovable property. The Explanation (a) makes it clear that the existence of a Commercial Dispute is separate and distinct from an action of recovery of immovable property or for realisation of monies out of immovable property given as security or for other relief pertaining to immovable property. To illustrate, a suit by a landlord against a tenant to recover possession of a shop will not fall within the jurisdiction of Commercial Court or Commercial Division unless and until it pertains to a commercial dispute as stipulated under Section 2(1)(c) of The Ordinance. It is also clear that the courts of Rent Controller as well as a Civil Court deal with the action for recovery of possession of immovable property, relating to both residential as well as commercial establishment, but the legislative intent in promulgation of The Ordinance cannot be said to usurp the jurisdiction of Rent Controller and Civil Courts as far as all actions for recovery of immovable property are concerned. If the contentions of the Ld. Counsel for the judgment debtor are to be believed, all the courts of Rent Controllers and the Civil Courts dealing with the petitions/suits for recovery of possession of the Commercial immovable property would be left with no jurisdiction to deal with all such petitions/suits and all such petitions/suits from the entire Delhi would have to be transferred to the Commercial Division of the Hon'ble High Court. The explanation appended to Section 2(1)(c) leaves no doubt as far as the nature of commercial dispute under The Ordinance is concerned.
8. The present is an execution petition passed in a suit for recovery of possession, which the judgment debtor is using for commercial Ex No. 30/14 Page 6/12 purposes. The suit was filed by the plaintiff/decree holder/ landlord against the defendant/judgment debtor/tenant to recover the possession of the suit property, wherein compromise decree dated 28.04.2014 was passed. The primary dispute between the parties to the suit was in the nature of a dispute between landlord and tenant and by no stretch of imagination can be said to be a "Commercial Dispute" as defined under Section 2(1)(c) of The Ordinance. Moreover, during the course of proceedings of the suit, the dispute between landlord and tenant was resolved and a compromise decree dated 28.04.2014 was passed, which indicates in no uncertain terms that there remained no dispute at all. Therefore, in my considered opinion, the contentions of the counsel for the judgment debtor to term the dispute in the present case as a "Commercial Dispute" falling within the definition of Section 2(1)(c) of The Ordinance is wholly misplaced and borders on being a mischievous one.
9. The second contention of the counsel for the judgment debtor pertains to the Specified Value of the suit property to be approximately Rs.3,75,00,000/-. It would be useful to refer the definition of "Specified Value" under Section 12(1) (c) of The Ordinance, which is as under:-
12. Determination of Specified Value- (1) The Specified Value of the subject matter of the commercial dispute in a suit, appeal or application shall be determined in the following manner-
(a)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(b)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(c) where the relief sought in a suit, appeal or application relates to immovable property or to a right therein, the market value of the immovable property, as on the date of filing of the suit, appeal or application, as the case may be, shall be taken into account for determining Specified Value;
(d)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(e)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
10. As per the above-mentioned provision, the Specified Value of the Ex No. 30/14 Page 7/12 subject matter of the commercial dispute shall be determined taking into account the market value of the immovable property on the date of filing of the suit/appeal/application as the case may be. Such determination again calls for leading of evidence and cannot be determined merely by taking the circle rates of the area into consideration. There is no doubt that for determination of the market value of any immovable property, only and only the circle rates of the area, where such immovable property is situated cannot be a determinative factor for the simple reason that the market value may be less or more than the prescribed circle rates. Such determination of Specified Value of an immovable property is purely a question of fact, which can only be determined by leading of evidence. Therefore, I also do not find any merit in the contentions of the counsel for the judgment debtor in this regard.
11. Thirdly, with regard to the jurisdiction of this court to adjudicate the application under Section 151 CPC, which was dismissed vide impugned order, it would be relevant to reproduce the relevant provisions stipulated under The Ordinance, which are as under:
3. Constitution of Commercial Courts. - (1) The State Government, many after consultation with the concerned High Court, by notification, constitute such number of Commercial Courts at District level, as it may deem necessary for the purpose of exercising the jurisdiction and powers conferred on those Courts under this Ordinance:
Provided that no Commercial Court shall be constituted for the territory over which the High Court has ordinary original civil jurisdiction.
(2)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (3)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
4.Constitution of Commercial Division of High Court-(1)In all High courts, having ordinary civil jurisdiction, the Chief Justice of the High Court may, by order, constitute Commercial Division having one or more Benches consisting of a single Ex No. 30/14 Page 8/12 Judge for the purpose of exercising the jurisdiction and powers conferred on it under this Ordinance.
(2)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
6. Jurisdiction of Commercial Court- The commercial Court shall have jurisdiction to try all suits and applications relating to a commercial dispute of a Specified Value arising out of the entire territory of the State over which it has been vested territorial jurisdiction.
7. Jurisdiction of Commercial Divisions of High Courts. - All suits and applications relating to commercial disputes of a Specified Value filed in a High Court having ordinary original civil jurisdiction shall be heard and disposed of by the Commercial Division or that High Court:
Provided that all suits and applications relating to commercial disputes, stipulated by an Act to lie in a court not inferior to a District Court, and filed on the original side of the High Court, shall be heard and disposed of by the Commercial Division of the High Court:
Provided further that all suits and applications transferred to the High Court by virtue of sub-section (4) of section 22 of the Designs Act, 2000 (16 of 2000) or section 104 of the Patents Act, 1970 (39 of 1970) shall be heard and disposed of by the Commercial Division of the High Court in all the areas over which the High Court exercises ordinary original civil jurisdiction.
Explanation (i) to Section 2(1)(c) - "Specified Value", in relation to a commercial dispute, shall mean the value of the subject matter in respect of a suit as determined in accordance with Section 12 which shall not be less than one crore rupees or such higher value, as may be notified by the Central Government.
15. Transfer of pending cases.- (1) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996 (26 of 1996), relating to a commercial dispute of Specified Value pending in a High Court where a Commercial Division has been constituted, shall be transferred to the Commercial Division.
(2) All suits and applications, including applications under the Arbitration and Conciliation Act, 1996 (26 of 1996), relating to Ex No. 30/14 Page 9/12 a commercial dispute of Specified Value pending in any civil court in any district or area in respect of which a Commercial Court has been constituted, shall be transferred to such Commercial Court:
Provided that no suit or application where the final judgment has been reserved by the Court prior to the constitution of the Commercial Division or the Commercial Court shall be transferred either under sub-section(1) or sub-section (2). (3)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (4)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (5)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
12. In view of the above-mentioned provisions, it is clear that Commercial Courts are to be constituted at the District level, whereas the Commercial Division may be constituted in the High Court. It is also clear that no Commercial Court shall be constituted for the territory over which the High Court exercises ordinary original civil jurisdiction, meaning thereby that no Commercial Court can be constituted for the territory of Delhi as the Hon'ble High Court of Delhi is exercising ordinary original civil jurisdiction.
13. Further, as per Section 6 of The Ordinance, the Commercial Court shall have jurisdiction to try suits and applications arising out of the entire territory of the State over which it has been vested territorial jurisdiction, whereas as per Section 7 of The Ordinance all suits and applications filed in a High Court having ordinary original civil jurisdiction shall be heard and disposed off by the Commercial Division of that High Court. As far as the transfer of pending suits on the date of promulgation of The Ordinance is concerned, as per Section 15 of The Ordinance, all suits and applications pending in a High Court, where a Commercial Division has been constituted, shall be transferred to the Commercial Division. Further, all suits and applications pending in any civil court in any district or area in respect of which a commercial court has been constituted shall be Ex No. 30/14 Page 10/12 transferred to such Commercial Court.
14. The proviso to Section 15(2) of The Ordinance also stipulates that no suits and applications, where the final judgment has been reserved by the court prior to the constitution of the Commercial Division or the Commercial Court shall be transferred either under sub-section (1) or sub-
section (2).
15. In view of the afore-mentioned provisions, it is amply clear that the pending suits in any court at the district level, if it relates to Commercial Dispute of a Specified Value, can be transferred to the Commercial Court, if constituted for the district. Similarly, the suits and applications pending in a High Court relating to a Commercial Dispute of Specified Value can be transferred to Commercial Division if constituted in that High Court. There is no provision for transfer of any suits and applications from a District Court to the Commercial Division of a High Court.
16. As observed earlier, no Commercial Court can be constituted at the district level in Delhi as the Hon'ble High Court of Delhi is exercising ordinary original civil jurisdiction, which goes to clarify that even if the suit or application pending at the district court in Delhi is relating to a commercial dispute of a Specified Value in terms of Section 2(1)(c) and Section 12 of The Ordinance, the same cannot be transferred to the Commercial Division of the Hon'ble High Court. With regard to the reliance placed by the counsel for the judgment debtor on both Surinder Kaur (supra) case and MVM Developers (supra) cases, suffice it to say that Surinder Kaur (supra) case is binding on this court, wherein the jurisdiction of the Commercial Division was reiterated, however, I am not persuaded by MVM Developers (supra) case.
Ex No. 30/14 Page 11/1217. The present is a case, where the decree holder is executing a compromise decree dated 28.04.2014. After filing of the execution petition , judgment debtor moved an application under Section 151 CPC on 14.07.2015, which was dismissed vide order dated 25.07.2015. Another application under Section 151 CPC was moved by judgment debtor on 24.07.2015, which was also dismissed vide the impugned order and warrants of possession were issued in respect of the suit property. Thereafter, again the present application under Section 114 read with Order XLVII and Section 151 CPC was moved on 04.01.2016, which clearly shows that the judgment debtor is indulging in vexatious and malafide practices for delaying the execution by moving one application after the other. In these circumstances, I do not find any merit in the application under Section 114 read with Order XLVII and Section 151 CPC moved on behalf of the judgment debtor seeking recall of the order dated 17.12.2015 passed by this court. The same is wholly devoid of merit.
18. Accordingly, I deem it fit to dismiss the application under Section 114 read with Order XLVII and Section 151 CPC moved on behalf of the judgment debtor with cost of Rs. 10,000/-(Rs. Ten Thousand only).
Announced in the open Court (KULDEEP NARAYAN)
on 12.01.2016 Additional District Judge-05
West Distt.Court Room No.33
Tis Hazari Courts, Delhi.
Ex No. 30/14 Page 12/12