Commercial division


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  • © Altacit Global 2009 Email:
  • Commercial division

    1. 1. COMMERCIAL DIVISION OF HIGH COURTS BILL, 2009 By Shelley Anandhavalli. E Advocate Altacit Global Email: [email_address] Website:
    2. 2. INTRODUCTION <ul><li>The bill </li></ul><ul><ul><ul><li>Seeks to enable speedy disposal of high value cases. </li></ul></ul></ul><ul><ul><ul><li>Aims to constitute a commercial division bench within each High Court. </li></ul></ul></ul><ul><ul><ul><li>Would enable the benches to have original jurisdiction on cases where the value of dispute is over Rs 5 crores. </li></ul></ul></ul><ul><ul><ul><li>Aims at following a fast track procedure for such cases </li></ul></ul></ul>
    3. 3. DEFINITION <ul><li>Section 2 ( 1) (a of the Act: </li></ul><ul><li>“ commercial dispute” means a dispute arising out of ordinary transactions of merchants, bankers and traders such as those relating to enforcement and interpretation of mercantile documents, export or import of merchandise, affreightment, carriage of goods, franchising, distribution and licensing agreements, maintenance and consultancy agreements, mercantile agency and mercantile usage, partnership, technology development in software, hardware, networks, internet, website and intellectual property such as trademark, copyright, patent, design, domain names and brands and such other commercial disputes which the Central Government may notify. </li></ul>
    4. 4. KEY ISSUES AND ANALYSIS <ul><li>The commercial division may appoint an advocate with 20 years or more experience at the Bar or a judicial officer in the rank of Senior Civil judge as Commissioner to record statements in cross-examination and re-examination of parties and witnesses. </li></ul><ul><li>The commercial division shall pronounce judgment within 30 days of the conclusion of argument. </li></ul><ul><li>A single judge sitting in the commercial division does not have power to decide on any objection as to the admissibility of any evidence. It shall be decided by the Bench of two judges sitting in the commercial division. </li></ul><ul><li>All decrees of the commercial division can be appealed in the Supreme Court. </li></ul>
    5. 5. KEY FEATURES <ul><li>The Bill has two main features: </li></ul><ul><li>It seeks to establish commercial divisions in High Courts with defined jurisdiction. </li></ul><ul><li>It introduces fast-track procedures applicable to commercial divisions. </li></ul>
    6. 6. FEATURES OF THE COMMERCIAL DIVISION OF HIGH COURTS BILL, 2009 Definition of “commercial dispute” Disputes between merchants, bankers and traders over transactions such as export or import of merchandise, carriage of goods, intellectual property, or over interpretation of commercial documents, and any dispute notified by the central government.   Minimum value of commercial disputes 'Specified value' of a commercial dispute to be notified by the central government in consultation with the state government.  This notified amount must be at least Rs. 5 crores. Establishment of commercial The central government will first consult with the respective state government and the High Court. divisions A notification enforcing this Act will then be issued with respect to that state. A High Court can then pass an order to constitute a commercial division.
    7. 7. Cntd.. Judges The Chief Justice of the High Court shall nominate judges from among the judges of the High Court. Cases the commercial division will handle <ul><li>Initial complaints (original jurisdiction) in commercial disputes above specified value. </li></ul><ul><li>Appeals against orders of lower courts in commercial disputes above specified value. </li></ul><ul><li>Writ cases under Article 226, and applications under Article 227 of the Constitution for setting aside temporary orders passed by lower courts in commercial disputes.  </li></ul><ul><li>The commercial division will also hear some appeals which currently lie in the High Court under the Arbitration and Conciliation Act, 1996.  </li></ul>Appeals Any appeal from the judgement/ order of the commercial division will lie in the Supreme Court.
    8. 8. APPLICABLE PROCEDURES Fast-Track procedure <ul><li>The Bill provides specific timelines to be followed during the proceedings before the Division. </li></ul><ul><li>The judges can hold case management conferences to fix time-frames for submission of documents, recording evidence, examining witnesses, etc. </li></ul><ul><li>Written arguments have to be filed before oral arguments commence.  Time limits for arguments can be fixed in the case management conference. </li></ul>
    9. 9. Cntd.. Time-limits fixed in the Bill <ul><li>The defendant has to file a reply to the complainant’s plaint within one month of receiving the plaint. </li></ul><ul><li>Within 15 days of receiving the defendant’s reply the complainant can request the commercial division for permission to file a rejoinder.  </li></ul><ul><li>The rejoinder has to be filed within one month of getting such permission. </li></ul><ul><li>Time limits for making written and oral submissions shall be fixed in advance at the case management conference. </li></ul><ul><li>The commercial division has to deliver its judgement within 30 days of the conclusion of arguments between parties. </li></ul>
    10. 10. Cntd.. How “specified value” will be determined <ul><li>For recovery of money:  The amount to be recovered, plus interest as on the date of filing the suit. </li></ul><ul><li>For property:  Market value of the property up to the date of filing the suit or appeal. </li></ul><ul><li>For intangible rights:  Estimated market value of the right as calculated by the complainant. </li></ul>
    11. 11. ADVANTAGES <ul><li>All the commercial disputes of high threshold value will be filed in the High Court and would be dealt with the Commercial Division. </li></ul><ul><li>It would speed up the disposal of these cases as District Courts would have no jurisdiction in such cases. </li></ul><ul><li>Commercial Division of High Court would be Court of Original Jurisdiction for such cases. </li></ul><ul><li>Fast track procedure will definitely curtail the time taken in disposal of such cases. </li></ul>
    12. 12. DISCRETION <ul><li>The decision to constitute Commercial Division is entirely with in the discretion of the High Court and the State Governments. </li></ul><ul><li>Proviso to (1) (3) of the Bill says, </li></ul><ul><ul><li>The provisions of the proposed act can be made applicable to a High Court only in consultation with the Chief Justice and the concerned State Government. </li></ul></ul>
    13. 13. Arbitration and Conciliation act, 1996 Amended <ul><li>Section 2 (1) (e) of the Arbitration and Conciliation Act, 1996 has been ammended to modify the definition of Court, so as to provide for the high Courts in exercise of Original jurisdiction wherever the specified value criteria is met. </li></ul><ul><li>Applications under sections 34, 36 and 37 , where the specified value criteria is met are also to be treated as commercial disputes and therefore to be taken up by the Commercial Division of High Court. </li></ul>
    14. 14. DISADVANTAGES <ul><li>The bill might divide the rich and the poor as any dispute which is less than the threshold value of 5 crores will be denied speedy justice. </li></ul><ul><li>The discrimination in classification is considered to be constitutionally invalid. </li></ul>
    15. 15. CONCLUSION <ul><li>In the era of Globalisation where India is looked upon as the investment hub, the need for speedy redressal should be highly considered. </li></ul><ul><li>The proposed bill needs more stakeholders and experts opinion and suggestions. </li></ul><ul><li>Due Caution should be exercised to pass the bill as it would fail to bring any change at all. </li></ul>