AMBALAL SARABHAI ENTERPRISES LTD. versus K. S. INFRASPACE LLP & ANR.
[2019] 13 S.C.R. 605, Supreme Court of India, 2019
Outcome: Dismissed (Dismissed)
Segment: Facts
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AMBALAL SARABHAI ENTERPRISES LTD.
v.
K. S. INFRASPACE LLP & ANR.
(Civil Appeal No. 7843 of 2019)
OCTOBER 04, 2019
[A. S. BOPANNA AND R. BANUMATHI, JJ.]
Commercial Courts Act, 2015: s. 2(1)(c)(vii) – Commercial
dispute – Maintainability of, before the Commercial Court – On
facts, dispute arising out of an agreement involving an immovable
property – Suit filed before the Commercial Court – In the suit,
the registration of a mortgage deed pertaining to the immovable
property is sought – High Court held that the immovable property
was not being used for trade or commerce as such the suit not
maintainable before the Commercial Court – On appeal, held: It
is clear from s. 2(1)(c)(vii) that disputes arising out of agreements
relating to immovable property used exclusively in trade or
commerce will qualify to be a commercial dispute to be tried by
Commercial Courts – On facts, neither the agreement between the
parties refers to the nature of the immovable property being
exclusively used for trade or commerce as on the date of the
agreement nor is there any pleading to that effect in the plaint –
Relief sought in the suit is for execution of the Mortgage Deed
which is in the nature of specific performance of the terms of
Memorandum of Understanding without reference to nature of the
use of the immovable property in trade or commerce as on the date
of the suit – Thus, the transaction between the parties which is the
subject matter of the suit could not be
considered as a “commercial
dispute”, so as to enable the Commercial Court to entertain the
suit – Order passed by the High Court is justified – Commercial
Court to return the plaint to the court having jurisdiction.
Objects and reasons – Held: Is to provide speedy disposal
of high value commercial disputes – Wider purport and meaning
is to be assigned while entertaining the suit and considering the
dispute to be a commercial dispute, else the very purpose of the
enactment would be defeated.
   [2019] 13 S.C.R. 605
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Dismissing the appeal, the Court
Per A. S. Bopanna, J.
HELD: 1.1 From a perusal of Section 2(1)(c)(vii) of the
Commercial Courts Act, 2015 it is noticed that the disputes
arising out of agreements relating to immovable property used
exclusively in trade or commerce will qualify to be a commercial
dispute to be tried by Commercial Courts. [Para 6] [614-F-G]
1.2 Even though in the paragraph describing jurisdiction
the plaintiff has stated with regard to the territorial jurisdiction
since the office and land being at Vadodara, there is no reference
indicating the reason for which the plaintiff pleads that the Court
which is the Commercial Court exclusively constituted to try the
commercial disputes has jurisdiction to try the instant suit. In
that background, a perusal of the prayer made in the plaint would
essentially indicate that the suit is one seeking for specific
performance of the terms of MoU whereunder it is agreed that
the Mortgage Deed be executed.  Even if the immovable
property under the Mortgage Deed was the subject matter it
was necessary to plead and indicate that the same was being used
in trade or commerce due to which the jurisdiction of
Commercial Court is invoked.  Without such basic pleadings in
the plaint, any explanations sought to be put forth subsequently
would only lead to a situation that if an objection is raised, in
every suit a consideration would be required based on
extraneous material
even to ascertain as to whether the intended
transaction between the parties was of such nature that it is to
be construed as a commercial dispute. [Para 9] [616-C-F]
1.3 The statement of objects and reasons with which the
Commercial Courts Act, 2015 is enacted so as to provide
speedy disposal of high value commercial disputes so as to create
the positive image to the investors world about the independent
and responsive Indian Legal System. A purposive interpretation
be made. A wider purport and meaning is to be assigned while
entertaining the suit and considering the dispute to be a
commercial dispute. In view thereof, the very purpose for which
the CC Act of 2015 has been enacted would be defeated if every
other suit merely because it is filed before the Commercial Court
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is entertained. This is for the reason that the suits which are
not actually relating to commercial dispute but being filed merely
because of the high value and with the intention of seeking early
disposal would only clog the system and block the way for the
genuine commercial disputes which may have to be entertained
by the Commercial Courts as intended by the law makers. In
commercial disputes as defined a special procedure is provided
for a class of litigation and a strict procedure will have to be
followed to entertain only that class of litigation in that
jurisdiction. If the same is strictly interpreted it is not as if those
excluded will be non–suited without any remedy. The excluded
class of litigation will in any event be entertained in the ordinary
Civil Courts wherein the remedy has always existed. [Para 13]
[620-B-E]
1.4 It is also necessary to carefully examine and entertain
only disputes which actually answers the definition ‘commercial
disputes’ as provided under the Act. In the instant case, neither
the agreement between the parties refers to the nature of the
immovable property being exclusively used for trade or
commerce as on the date of the agreement nor is there any
pleading to that effect in the plaint. Further the very relief sought
in the suit is for execution of the Mortgage Deed which is in
the nature of specific performance of the terms of Memorandum
of Understanding without reference to nature of the use of the
immovable
property in trade or commerce as on the date of the
suit. Therefore, if all these aspects are kept in view, in the
present facts the High Court was justified in its conclusion
arrived through the order impugned. The Commercial Court
shall therefore return the plaint indicating a date for its
presentation before the Court having jurisdiction. [Para 14] [620-
F-H; 621-A]
Vasu Healthcare Private Limited v. Gujarat Akruti TCG
Biotech Limited AIR 2017 Gujarat 153 – approved.
Jagmohan Behl v. State Bank of Indore (2017) SCC
OnLine Del 10706 ; Federation of A.P. Chambers of
Commerce & Industry and Ors. v. State of A.P. and Ors.,
(2000) 6 SCC 550 : [2000] 2 Suppl. SCR 151 –
referred to.
AMBALAL SARABHAI ENTERPRISES LTD. v.
K. S. INFRASPACE LLP & ANR.
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[2019] 13 S.C.R.
Case Law Reference
(2017) SCC OnLine Del 10706
referred to
Para 10
AIR 2017 Gujarat 153
approved
Para 12
[2000] 2 Suppl. SCR 151
referred to
Para 12
Per Banumathi, J. (Concurring) :
HELD :1.1 In order to fall within Section 2(1)(c)(vii) of the
Commercial Courts Act, the immovable property must be “used
exclusively” or “being used exclusively” in trade or commerce.
A matter will fall under the jurisdiction of the Commercial Court
or the Commercial Division of the High Court on the following
factors: it shall be a commercial dispute within the meaning of
Section 2(1)(c) of the Act; and such commercial disputes are of
a specified value as per Section 2(i) of the Act.  [Para 1, 11] [621-
C; 626-D-E]
1.2 The Schedule to the Commercial Courts Act amends
various provisions of the Code of Civil Procedure and thereby
makes significant departure from the Code. After Order XIII of
the Code, Order XIIIA–”Summary Judgment” has been
inserted. Order XIIIA contains the scope and classes of suits
to which Order XIIIA applies, grounds for summary judgment,
procedure to be followed, evidence for hearing of summary
judgment, orders that may be made by Court in such proceedings
for summary judgment, etc. After Order XV of the Code, Order
XVA–”Case Management Hearing” has been inserted. Order
XVA provides for first Case Management Hearing (Rule 1);
recording of oral evidence on a day–to–day basis (Rule 4);
powers of the Court in a Case
Management Hearing (Rule 6);
adjournment of Case Management Hearing (Rule 7);
consequences of non–compliance with orders (Rule 8).  By way
of amendment, several rules have been incorporated to make
the matters of commercial disputes on fast track. In Order XX
of the Code – “Judgment”, Rule 1 has been substituted that
within ninety days of the conclusion of arguments, the
Commercial Court/Commercial Division/Commercial Appellate
Division to pronounce the judgment and copies thereof shall be
issued to all the parties to the dispute through electronic mail
or otherwise. [Para 19] [629-F-H; 630-A-B]
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1.3 Various provisions of the Act namely Case
Management Hearing and other provisions makes the court to
adopt a pro–active approach in resolving the commercial dispute.
A new approach for carrying out case management and strict
guidelines for completion of the process has been introduced
so that the adjudicatory process is not delayed. The trial of the
commercial dispute suits is put on fast track for disposal of the
suits expeditiously. Various provisions of the Act and the
amendments inserted to Civil Procedure Code by the Schedule
is to ensure speedy resolution of the commercial disputes in a
time bound manner. The intent of the legislature seems to be
to have a procedure which expedites the disposal of commercial
disputes and thus creates a positive environment for investment
and development and make India an attractive place to do
business. [Para 20] [630-C-E]
1.4 A perusal of the Statement of Objects and Reasons of
the Commercial Courts Act, 2015 and the various amendments
to Civil Procedure Code and insertion of new rules to the Code
applicable to suits of commercial disputes show that it has been
enacted for the purpose of providing an early disposal of high
value commercial disputes. A purposive interpretation of the
Objects and Reasons and various amendments to Civil
Procedure Code leaves no room for doubt that the provisions
of the Act require to be strictly construed. If the provisions are
given a liberal interpretation, the object behind
constitution of
Commercial Division of Courts, viz. putting the matter on fast
track and speedy resolution of commercial disputes, will be
defeated. It is seen from the Statement of Objects and Reasons,
that words such as ‘early’ and ‘speedy’ have been incorporated
and reiterated. The object shall be fulfilled only if the provisions
of the Act are interpreted in a narrow sense and not hampered
by the usual procedural delays plaguing our traditional legal
system. [Para 21] [630-F-H; 631-A]
1.5 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(1)(c) of the
Act–”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
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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. [Para 22] [631-B-C]
1.6 On 03.11.2017, a Memorandum of Understanding was
executed between the appellant–plaintiff, respondent–defendant
and second respondent. As per the terms of MOU, parties
executed a Deed of Conveyance of the land. A mortgage deed
was executed simultaneously along with the MOU with respect
to the part of the land admeasuring 15,000 sq.ft. in favour of the
plaintiff. It was understood between the parties that respondent
No.1 would apply for change of land use permission for the land
in question on signing of the MOU. Mortgage deed was
executed by respondent No.1 in favour of the appellant in order
to ensure performance of obligations under the MOU. But the
said mortgage deed was not presented for registration. [Para 23]
[631-D-E]
1.7 It appears that the trial court has proceeded under the
footing that the parties to the suit more particularly, the
appellant–plaintiff seems to be carrying on business as Estate
Agent and to manage land, building, etc. and the very object as
enumerated in Memorandum and Articles of Association of the
appellant–plaintiff company established that the property in
question are being used exclusively in trade or
commerce rather
in the business of the plaintiff. As rightly pointed out by the High
Court, there is nothing on record to show that at the time when
agreement to sell came to be executed in 2012, the property
was being exclusively used in trade and commerce so as to bring
dispute within the ambit of sub–clause (vii) of Section 2(1)(c) of
the Act. Merely because, the property is likely to be used in
relation to trade and commerce, the same cannot be the ground
to attract the jurisdiction of the Commercial Court. [Para 24]
[631-F-H]
1.9 The object and purpose of the establishment of
Commercial Courts, Commercial Divisions and Commercial
Appellate Divisions of the High Court is to ensure that the cases
involved in commercial disputes are disposed of expeditiously,
fairly and at reasonable cost to the litigants. Keeping in view
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the object and purpose of the establishment of the Commercial
Courts and fast tracking procedure provided under the Act, the
statutory provisions of the Act and the words incorporated
thereon are to be meaningfully interpreted for quick disposal of
commercial litigations so as to benefit the litigants especially
those who are engaged in trade and commerce which in turn will
further economic growth of the country. [Para 27] [632-H; 633-
A-B]
Vasu Healthcare Private Limited v. Gujarat Akruti TCG
Biotech Limited & Anr. (2017) SCC Online Guj 724 –
approved.
Ujwala Raje Gaekwar v. Hemaben Achyut Shah
(2017) SCC Guj 583 – referred to.
Case Law Reference
(2017) SCC Guj 583
referred to
Para 25
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7843
of 2019.
From the Judgment and Order dated 01.03.2019 of the  High
Court of  Gujarat at Ahmedabad in R/Special Civil Application No. 17868
of 2018
Dhruv Mehta, Sr. Adv. Ms. Anushree Prashit Kapadia, Anubhav
Ray, Ms. Runashree Saikia, Ms. Sonakshi, Advs. for the Appellant.
Deven Parikh, Sr. Adv., Shashvata Shukla, Nikhil Goel,
Ms. Naveen Goel, Dushyant Sarna, Piyo Harold, Advs. for the
Respondents.
The Judgments of the Court were delivered by
A. S. BOPANNA, J.
1. Leave granted.
2. The appellant herein is the plaintiff in Commercial Court Suit
No. 41/2018 filed before the Commercial Court at Vadodara. The
respondents herein are arrayed as the defendants to the suit. The
respondents on being notified in the suit had appeared
and filed the
written statement inter alia contending that the suit is not maintainable
as the dispute involved cannot be termed as a commercial dispute within
the meaning of Section 2(1)(c) of the Commercial Courts Act, 2015
AMBALAL SARABHAI ENTERPRISES LTD. v.
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(“CC Act, 2015” for short).  In view of such contention, the respondents
herein also filed an application under Order VII Rule 10 of the Civil
Procedure Code seeking an order to return the plaint to be presented
in the Court in which the suit should have been instituted. The appellant
herein though did not choose to file objection to the said application,
had however opposed the same. The application was registered as
Exhibit 15 and the learned Judge of the Commercial Court on
consideration had through the order dated 17.10.2018 rejected the
application. The respondents herein claiming to be aggrieved by the said
order had approached the High Court of Gujarat in R/Special Civil
Application No.17868/2018. The High Court through a detailed order
dated 01.03.2019 has allowed the petition, set aside the order dated
17.10.2018 passed by the Commercial Court, Vadodara and on allowing
the application filed under Order VII Rule 10 CPC directed that the
plaint be returned to the appellant herein to be presented in the Court
in which the suit should have been instituted. The appellant herein,
therefore, claiming to be aggrieved by the order dated 01.03.2019 is
before this Court in this appeal.
3. The brief facts which led to the present situation is that the
appellant herein executed an agreement to sell dated 14.02.2012 in
favour of the respondent No. 2 in respect of the land which is described
in the agreement. The
respondent No. 2 assigned and transferred all
his rights under the said agreement to sell in favour of respondent No.1
by executing an assignment deed dated 12.10.2017. In that view, the
respondent No. 1 herein was to purchase the lands which were the
subject matter of the agreement from the appellant herein.  Accordingly,
the sale was made under a Deed of Conveyance dated 03.11.2017.
Since certain other aspects were to be completed regarding the change
relating to the nature of the use of the land for conclusion of the
transaction, the right of the appellant in respect of the land was to be
protected. In that view a Memorandum of Understanding dated
03.11.2017 was entered into between the appellant and the respondents
herein.  As per the same, a Mortgage Deed was required to be
executed by respondent No. 1 herein in favour of the appellant.
4. Accordingly, a Mortgage Deed dated 03.11.2017 was executed
but the same had not been registered.  It is in that light the appellant
herein filed the Commercial Civil Suit No. 41/2018 so as to enforce
the execution of a Mortgage Deed.  Consequently, the relief of
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permanent injunction and other related reliefs were sought.  It is in the
said suit, summon was issued to respondents herein who are the
defendants in the suit, wherein on filing the written statement the
application under Order VII Rule 10 of CPC was filed.  The
Commercial Court while rejecting the application had referred to the
Memorandum and Articles of Association of the appellant company and
in that light taking note of the business that they were entitled to
undertake has arrived at the conclusion that the plaintiff seems to be
carrying on the business as an estate agent and in that circumstance
has further arrived at its conclusion that it is a commercial dispute.  The
High Court on the other hand had found fault with the manner in which
the Commercial Court had rested its consideration on the Memorandum
and Articles of Association and had examined the matter in detail to
come to a conclusion that the immovable property in the instant case
was not being used for trade or commerce. In that regard, the legal
position enunciated by the various decisions was referred to and had
accordingly directed the return of the plaint to be presented in an
appropriate Court which is assailed herein.
5. We have heard Shri Dhruv Mehta, learned senior advocate
for the appellant, Shri Deven Parikh, learned senior advocate for the
respondents and perused the appeal papers.
6. At the outset, it is noticed that the consideration required in
the instant case is as to
whether the transaction between the parties
herein which is the subject matter of the suit could be considered as a
“commercial dispute” so as to enable the Commercial Court to entertain
the suit.  In that regard, it is necessary to take note of Section 2(1)(c)(vii)
of the CC Act, 2015.  The said provision to the extent relevant is
extracted here below for reference.
“Sec.2(1)In this Act, unless the context otherwise requires,-
(a) xxx
(b) xxx
(c) “commercial dispute” means a dispute arising out of –
(i) xxx
(ii) xxx
(iii) xxx
AMBALAL SARABHAI ENTERPRISES LTD. v.
K. S. INFRASPACE LLP & ANR. [A. S. BOPANNA, J.]
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(iv) xxx
(v) xxx
(vi) xxx
(vii) agreements relating to immovable property   used
exclusively in trade or commerce;
(viii) xxx
(ix) xxx
(x) xxx
(xi) xxx
(xii) xxx
(xiii) xxx
(xiv) xxx
(xv) xxx
(xvi) xxx
(xvii) xxx
(xviii) xxx
(xix) xxx
(xx) xxx
(xxi) xxx
(xxii) xxx
From a perusal, of the provision relied upon by the learned senior
advocates it is noticed that the disputes arising out of agreements relating
to immovable property used exclusively in trade or commerce will
qualify to be a commercial dispute to be tried by Commercial Courts.
The question therefore would be that, in the instant case though the
parties have entered into a sale transaction of the immovable property
and presently in the suit the registration of a Mortgage Deed pertaining
to the immovable property is sought, whether the immovable property
involved could be considered as being used exclusively in trade or
commerce.
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7. The learned senior advocate for the appellant has made
detailed submissions referring to the documents to contend that the
appellant was running an industry in the land concerned which was
acquired for that purpose and presently the respondent No.1 has
purchased the same for developing the said land and in that view the
land is one which is used for trade and commerce. The learned senior
advocate for the respondents on the other hand has contended to the
contrary that the appellant had ceased to function for the past several
years and the company being defunct, the land involved was not being
used for trade or commerce and even though the respondent No.1 has
sought for change of land use and to develop the land, the same would
be subject to such change of land use that would be granted and the
use to which it would be put in future. Hence it is contended that as
on the date of transaction the land is not being used for trade or
commerce and a suit at present would not be maintainable before the
Commercial Court.
8. Though such rival contentions are put forth by the learned
senior advocate on either side, these aspects cannot be dealt with in
abstract. Instead the nature of the dispute and the jurisdiction to try
the same is 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. Hence before adverting to the other aspects it
would be necessary to
carefully examine the plaint. The plaintiff has
in detail referred to the nature of the transaction between the appellant
and the respondents herein. In para 5 thereof the detail of the land
bearing R.S. No.122 corresponding to City Survey No.1101 and 1100/
1 having land area of 9207 square metres at Mouje Subhanpura Reg.
District, Vadodara is referred. Further the schedule of the property is
indicated in para 6 and reference is made to the Memorandum of
Understanding where again the reference is made to the land. It is
averred therein that it would be the total responsibility of the respondent
No.1 herein (defendant No.2 in the suit) to change the land use as well
as to pay the amount that may be required for the permission. The
amount to be paid as premium is referred and the right of the plaintiff
to secure the Mortgage Deed in view of the terms of the MoU is stated.
In the entire plaint there is no reference to the nature of the land or
the type of use to which it was being put as on the date of the
Agreement to Sell/Sale Deed/Memorandum of Understanding or as on
the date of the suit.
AMBALAL SARABHAI ENTERPRISES LTD. v.
K. S. INFRASPACE LLP & ANR. [A. S. BOPANNA, J.]
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9. Further on referring to the cause of action in para 21, the
plaintiff has thereafter referred in para 22 to the jurisdiction of the Court
to hear and decide the matter.  It would be appropriate to extract the
same which reads as hereunder:
“22.Jurisdiction: The Plaintiff states that the Defendants having
their office at Vadodara land which is the subject matter of the
instant suit is situated within the territorial jurisdiction of this
Hon’ble Court and hence this Hon’ble Court has the jurisdiction
to hear and decide the matter.”
Even though in the paragraph describing jurisdiction the plaintiff
has stated with regard to the territorial jurisdiction since the office and
land being at Vadodara, there is no reference indicating the reason for
which the plaintiff pleads that the Court which is the Commercial Court
exclusively constituted to try the commercial disputes has jurisdiction
to try the instant suit.  In that background, a perusal of the prayer made
in the plaint would essentially indicate that the suit is one seeking for
specific performance of the terms of MoU whereunder it is agreed that
the Mortgage Deed be executed.  Even if the immovable property under
the Mortgage Deed was the subject matter it was necessary to plead
and indicate that the same was being used in trade or commerce due
to which the jurisdiction of Commercial Court is invoked.  Without such
basic pleadings in the plaint, any explanations
sought to be put forth
subsequently would only lead to a situation that if an objection is raised,
in every suit a consideration would be required based on extraneous
material even to ascertain as to whether the intended transaction
between the parties was of such nature that it is to be construed as a
commercial dispute.
10. Be that as it may, the learned senior advocates on both sides
have sought to rely on the legal position decided by the various High
Courts in the absence of the pronouncement of this Court.  The learned
senior advocate in that regard have referred to the various decisions
on the same point.  However, we do not find it appropriate to refer to
each of them and over burden this order since we notice that the High
Court in fact has referred to various decisions while deciding the instant
case and has thereafter arrived at its conclusion.  The discussion as
made by the High Court with reference to the various decisions is also
justified.  In that view, we would refer to the decision of a Division
Bench in the case of Jagmohan Behl vs. State Bank of Indore, 2017
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SCC OnLine Del 10706 relied on by the learned senior advocate for
the appellant.  In that regard, it is noticed that in the said case on taking
note of the provision contained in Clause 2(1)(c)(vii) of the CC Act,
2015 it is held that the dispute involved therein would constitute a
commercial dispute and the expression “arising out of” and “in relation
to immovable property” should not be given the narrow and restricted
meaning and the expression would include all matters relating
agreements in connection with the immovable properties. The said
conclusion reached was in a circumstance where the immovable
property in question was undoubtedly being used for a trade or
commerce and it was held so when the claim in the suit is for recovery
of rent or mesne profit, security deposit etc. for the use of such
immovable property.
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.  The
verbatim consideration therein is as hereunder;
“Therefore, if the dispute falls within any of the clause 2(c) the
dispute can be said to be “commercial dispute” for which the
Commercial Court would have jurisdiction. It is required to be
noted that before the learned Commercial Court the original
plaintiff relied upon section 2(c)(i), 2(c)(ii) and 2(c)(xx) of the
Commercial Courts Act only. Learned Counsel appearing on
behalf of the original plaintiff has candidly admitted and/or
conceded that the case shall not fall within clause 2(c)(i); 2(c)(ii)
or 2(c)(xx) of the Commercial Courts Act. It is required to be
noted that before the learned Commercial Court it was never
the case on behalf of the original plaintiff that case would fall
within section 2(c)(vii) of the learned Commercial Court. Despite
the above we have considered on merits whether even
considering section 2(c)(vii) of the Commercial Courts Act, the
AMBALAL SARABHAI ENTERPRISES LTD. v.
K. S. INFRASPACE LLP & ANR. [A. S. BOPANNA, J.]
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dispute between the parties can be said to be “commercial
dispute” within the definition of section 2(c) of the Commercial
Courts Act or not? 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. As observed hereinabove, at the time of filing of the
suit and even so pleaded in the plaint, the immovable property/
plots the agreements between the parties cannot be said to be
agreements relating to immovable property used exclusively
in trade or commerce. As per the agreement between the party
after getting the plots on lease from the GIDC, the same was
required to be thereafter developed by the original defendant No.
1 and after providing all infrastructural facilities and sub-plotting
it, the same is required to be given to other persons like the
original plaintiff. It is the case on behalf of the original plaintiff
that as the original defendant No. 1 has failed to provide any
infrastructural facilities and develop the plots and therefore, a civil
suit for specific performance of the agreement has been filed.
There are other alternative prayers also. Therefore, it cannot be
said that the agreement is as such relating to immovable property
used exclusively in trade or commerce. It is the case on behalf
of the original plaintiff that as in clause (vii) of section 2(c), the
pharseology used is not “actually
used” or “being used” and
therefore, even if at present the plot is not used and even if it is
likely to be used even in future, in that case also, section 2(c)(vii)
shall be applicable and therefore, the Commercial Court would
have jurisdiction. The aforesaid has no substance. As per the
cardinal principle of law while interpreting a particular statute or
the provision, the literal and strict interpretation has to be applied.
It may be noted that important words used in the relevant
provisions are “immovable property used exclusively in trade
or commerce”. If the submission on behalf of the original
plaintiff is accepted in that case it would be adding something in
the statute which is not there in the statute, which is not
permissible. 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”
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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.”
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.  This is for the reason that this Court
while examining the issue relating to exclusive land use, though in the
different context has laid emphasis on the present user of the land either
for agriculture or non-agriculture purpose being relevant.  In that regard,
the decision relied on by the learned senior advocate for the respondent
in the case of Federation of A.P. Chambers of Commerce & Industry
and Ors. vs. State of A.P. and Ors., (2000) 6 SCC 550 is noticed,
wherein it is observed as under:
“6.Section 3 of the said Act speaks of “land is used for any
industrial purpose”, “land is used for any commercial purpose”
and “land is used for any other non-agricultural purpose”.  The
emphasis is on the word “is used”.  For the purpose of levy of
assessment on non-agricultural lands at the rate specified in the
Schedule for land used for industrial purposes,
therefore, there
has to be a finding as a fact that the land is in fact in praesenti
in use for an industrial purpose.  The same would apply to a
commercial purpose or any other non-agricultural purpose.”
“9.We are in no doubt whatever, therefore, that it is only land
which is actually in use for an industrial purpose as defined in
the said Act that can be assessed to non-agricultural assessment
at the rate specified for land used for industrial purposes.  The
wider meaning given to the word “used” in the judgment under
challenge is untenable.  Having regard to the fact that the said
Act is a taxing statute, no Court is justified in imputing to the
legislature an intention that it has not clearly expressed in the
language it has employed.”
(emphasis supplied)
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13. The learned senior advocate for the appellant would however,
contend that a strict interpretation as in the case of taxing statutes would
not be appropriate in the instant case where the issue relates to
jurisdiction. In that regard, the learned senior advocate has referred to
the statement of objects and reasons with which the Commercial Courts
Act, 2015 is enacted so as to provide speedy disposal of high value
commercial disputes so as to create the positive image to the investors
world about the independent and responsive Indian Legal System.
Hence, he contends that a purposive interpretation be made. It is
contended that a wider purport and meaning is to be assigned while
entertaining the suit and considering the dispute to be a commercial
dispute.  Having taken note of the submission we feel that the very
purpose for which the CC Act of 2015 has been enacted would be
defeated if every other suit merely because it is filed before the
Commercial Court is entertained. This is for the reason that the suits
which are not actually relating to commercial dispute but being filed
merely because of the high value and with the intention of seeking early
disposal would only clog the system and block the way for the genuine
commercial disputes which may have to be entertained by the
Commercial Courts as intended by the law makers. In commercial
disputes as defined a special procedure is provided for a class of
litigation
and a strict procedure will have to be followed to entertain
only that class of litigation in that jurisdiction. If the same is strictly
interpreted it is not as if those excluded will be non-suited without any
remedy.  The excluded class of litigation will in any event be entertained
in the ordinary Civil Courts wherein the remedy has always existed.
14. In that view it is also necessary to carefully examine and
entertain only disputes which actually answers the definition “commercial
disputes” as provided under the Act. In the instant case, as already
taken note neither the agreement between the parties refers to the
nature of the immovable property being exclusively used for trade or
commerce as on the date of the agreement nor is there any pleading
to that effect in the plaint. Further the very relief sought in the suit is
for execution of the Mortgage Deed which is in the nature of specific
performance of the terms of Memorandum of Understanding without
reference to nature of the use of the immovable property in trade or
commerce as on the date of the suit. Therefore, if all these aspects
are kept in view, we are of the opinion that in the present facts the
High Court was justified in its conclusion arrived through the order dated
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01.03.2019 impugned herein.  The Commercial Court shall therefore
return the plaint indicating a date for its presentation before the Court
having jurisdiction.
15. Accordingly, the instant appeal being devoid of merit stands
dismissed, with no order as to costs.
R. BANUMATHI, J.
1. I have gone through the judgment of my esteemed Brother
Justice A.S. Bopanna. I am in full agreement with the conclusion that
in order to fall within Section 2(1)(c)(vii) of the Commercial Courts Act,
the immovable property must be “used exclusively” or “being used
exclusively” in trade or commerce. However, in view of the importance
of the question involved, I would like to give my reasonings for
concurring with the conclusion of my esteemed Brother.
2. The Commercial Courts, Commercial Division and
Commercial Appellate Division of High Courts Act, 2015 (Act No.4 of
2016) published in the Gazette of India on 01.01.2016. The Act is
deemed to have come into force w.e.f. 23.10.2015. The Act No.4 of
2016 was amended by Central Act 28 of 2018 – The Commercial
Courts Act.
3. We may refer to the Law Commission’s 253rd Report, which
inter alia made various recommendations. Para (4.2) of Chapter IV-
”Conclusions and Summary of Recommendations” of Law
Commission’s 253rd Report reads as under:-
“4.2 The Commercial Courts, the Commercial Divisions and the
Commercial Appellate Divisions of High Courts that have been
recommended are intended to serve as a pilot project in the larger
goal
of reforming the civil justice system in India. The goal is to
ensure that cases are disposed of expeditiously, fairly and at
reasonable cost to the litigant. Not only does this benefit the
litigant, other potential litigants (especially those engaged in trade
and commerce) are also advantaged by the reduction in backlog
caused by the quick resolution of commercial disputes. In turn,
this will further economic growth, increase foreign investment,
and make India an attractive place to do business. Further, it also
benefits the economy as a whole given that a robust dispute
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resolution mechanism is a sine qua non for the all-round
development of an economy”.1
After Law Commission’s 253rd Report, the Act No.4 of 2016 was
amended by Central Act 28 of 2018.
4. Section 3 of the Act deals with Constitution of Commercial
Courts. As per Section 3 of the Act, the State Government shall, after
consultation with the High Court, by notification, constitute Commercial
Courts at District level if deemed necessary for the purpose of
exercising jurisdiction under the Act. As per Section 3(1A) of the Act,
Commercial Courts shall have jurisdiction to try the commercial disputes
of a “Specified Value” which shall not be less than three lakh rupees
or such higher value, for whole or part of the State, as it may consider
necessary. After amendment in 2018, proviso to Section 3 provides that
Commercial Courts may be constituted with respect to area over which
the High Courts have ordinary original civil jurisdiction. Section 5(1) of
the Act provides for the constitution of Commercial Appellate Division
having one or more Division Benches for the purpose of exercising
jurisdiction and powers conferred on it by the Act.
5. Section 6 deals with the jurisdiction of Commercial Court.
Section 6 of the Act reads as under:-
“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.
Explanation. – For the purposes of this section, a commercial
dispute shall be considered to arise out of the entire territory of
the State over which a Commercial Court has been vested
jurisdiction, if the suit or application relating to such commercial
dispute has been instituted as per the provisions of sections 16
to 20 of the Code of Civil Procedure, 1908 (5 of 1908)”.
6. Section 7 deals with the jurisdiction of Commercial Divisions
of High Courts. Section 7 of the Act reads as under:-
1 See Para (4.2) of Chapter-IV-‘Conclusions and Summary of Recommendations’ of
Law Commission’s 253rd Report – Commercial Division and Commercial Appellate
Division of High Courts and Commercial Courts Bill, 2015.
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“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 of 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 or pending 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”.
7. Commercial Divisions are to be set up in High Courts that are
already having ordinary original civil jurisdiction having one or more
Benches consisting of a Single Judge having experience in dealing with
commercial disputes for exercising powers under the Act.  As per
Section 7(1) and the proviso thereto, Commercial Division will hear and
dispose of all suits and applications relating to commercial disputes of
a specified value, that lie in a court not inferior to district court and
filed in a High Court having ordinary
original civil jurisdiction and also
those cases transferred to High Court under Section 22(4) of the
Designs Act, 2000 or under Section 104 of the Patents Act, 1970.
8. Section 5 of the Act deals with the Constitution of Commercial
Appellate Division.  Section 5(1) of the Act reads as under:-
“5. Constitution of Commercial Appellate Division. – (1)
After issuing notification under sub-section (1) of section 3 or
order under sub-section (1) of section 4, the Chief Justice of the
concerned High Court shall, by order, constitute Commercial
Appellate Division having one or more Division Benches for the
purpose of exercising the jurisdiction and powers conferred on
it by the Act.
………”
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In terms of Section 5(2) of the Act, the Chief Justice of the High
Court shall nominate such Judges of the High Court who have
experience in dealing with commercial disputes to be Judges of the
Commercial Appellate Division.
9. Section 2(1)(c) defines “commercial dispute” as under:-
“2.  Definitions. - (1) In this Act, useless the context otherwise
requires,-
……….
(c) “Commercial dispute” means a dispute arising out of-
(i) ordinary transaction of merchants, bankers, financiers and
traders such as those relating to mercantile documents,
including enforcement and interpretation of such
documents;
(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 usage;
(xv) partnership agreements;
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(xvi) technology development agreement;
(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
resource including electromagnetic spectrum;
(xx) insurance and re-insurance;
(xxi) contract 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
commercial dispute merely because-
(a)  it also involves action for recovery of immovable property
or for realising of monies out of immovable 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;
(d) “Commercial Division” means the Commercial Division in
a High Court constituted under sub-section (1) of section
4;
(e) “District Judge” shall have the same meaning as assigned
to it in clause (a) of Article 236 of the Constitution of India:
(f) “Document” means any mater expressed or described upon
any substance by means of letters, figures or marks, or
electronic means, or by more than one of those means,
intended to be used, or which may be used, for the
purpose
of recording that matters;
(g) “Notification” means a notification published in the Official
Gazette and the expression “notify” with its cognate
meanings and grammatical variations shall be construed
accordingly;
AMBALAL SARABHAI ENTERPRISES LTD. v.
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(h) “schedule” means the Schedule appended to the Act; and
       (i) “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 three lakh rupees] or such higher value, as
may be notified by the Central Government.”
[Subs. by Act 28 of 2018, sec. 4(II), for “which shall not
be less than one crore rupees” (w.r.e.f. 3-5-2018)].
10. As noted above, clause (i) of Section 2 of the Act defines
“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 three lakh
rupees] or such higher value, as may be notified by the Central
Government”. Section 12 provides for criteria for valuation of the suit,
application or appeal for the purpose of the Act.
11. A matter will fall under the jurisdiction of the Commercial
Court or the Commercial Division of the High Court on the following
factors:-
(i) it shall be a commercial dispute within the meaning of
Section 2(1)(c) of the Act; and
(ii) such commercial disputes are of a specified value as per
Section 2(i) of the Act.
12. As per Section 11 of the Act, notwithstanding anything
contained in the Act, a Commercial Court or a Commercial Division
shall not entertain or decide any suit relating to any commercial dispute
in
respect of which the jurisdiction of the civil court is either expressly
or impliedly barred under any other law for the time being in force.
13. Section 15 of the Act deals with transfer of pending cases.
Section 15 of the Act reads as under:-
“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.
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(2) All suits and applications, including applications under the
Arbitration and Conciliation Act, 1996 (26 of 1996), relating to a
commercial dispute of a 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).
………”.
14. Insofar as transferred cases, as per Section 15(4) of the Act,
the Commercial Division or Commercial Court shall prescribe new
timelines or issue further directions for speedy and efficacious disposal
of such suit or application in accordance with Order XVA of the Code
of Civil Procedure. New time period for filing written statement shall
be prescribed and the proviso to sub-rule (1) of rule 1 of Order V of
the Code of Civil Procedure shall not apply to the transferred cases
and the Court may, in its discretion, prescribe a new time period within
which the written statement shall be filed.
15. The preamble of the Commercial Courts Act, 2015 reads as
under:-
“An Act to provide for the constitution of Commercial Courts,
Commercial Appellate Courts, Commercial Division and
Commercial Appellate Division in the High Courts for
adjudicating commercial disputes of specified value and
matters
connected therewith or incidental thereto.”
16. The Statement of Objects and Reasons of the Commercial
Courts Act reads as under:-
“Statement of Objects and Reasons
The proposal to provide for speedy disposal of high value
commercial disputes has been under consideration of the
Government for quite some time. The high value commercial
disputes involve complex facts and question of law. Therefore,
there is a need to provide for an independent mechanism for their
early resolution. Early resolution of commercial disputes shall
AMBALAL SARABHAI ENTERPRISES LTD. v.
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create a positive image to the investor world about the
independent and responsive Indian legal system.
……….
6. It is proposed to introduce the Commercial Courts, Commercial
Division and Commercial Appellate Division of High Courts Bill,
2015 to replace the Commercial Courts, Commercial Division and
Commercial Appellate Division of High Courts Ordinance, 2015
which inter alia, provides for the following namely:-
(i) constitution of the Commercial Courts at District level
except for the territory over which any High Court is having
ordinary original civil jurisdiction;
(ii) constitution of the Commercial Divisions in those High
Courts which are already exercising ordinary civil jurisdiction
and they shall have territorial jurisdiction over such areas
on which it has original jurisdiction;
(iii) constitution of the Commercial Appellate Division in all the
High Courts to hear the appeals against the Orders of the
Commercial Courts and the Orders of the Commercial
Division of the High Court;
(iv) the minimum pecuniary jurisdiction of such Commercial
Courts and Commercial Division is proposed as one crore
rupees; and
(v) to amend the Code of Civil Procedure, 1908 as applicable
to the Commercial Courts and Commercial Divisions which
shall prevail over the existing High Courts Rules and other
provisions of the Code of Civil Procedure, 1908 so as to
improve the efficiency and reduce delays in disposal of
commercial cases.
……...”
The object and purpose of Commercial Courts Act is to ensure
that the Commercial Courts, Commercial Appellate Courts, Commercial
Division and Commercial Appellate Division of the High Courts dispose
of commercial cases expeditiously, fairly and at reasonable cost to the
litigant.
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17. Section 13 deals with appeals from decrees of Commercial
Courts and Commercial Divisions. As per Section 14 of the Act, the
Commercial Appellate Court and the Commercial Appellate Division
shall endeavour to dispose of appeals filed before it within a period of
six months from the date of filing of such appeal.
Fast Track Procedure for deciding the Commercial Disputes
18. As per Section 16 of the Act, the provisions of the Code of
Civil Procedure as amended under the Act, shall apply in the trial of
suit in respect of a commercial dispute of a specified value. Section 16
of the Act reads as under:-
“16. Amendments to the Code of Civil Procedure, 1908
in its application to commercial disputes. – (1) The
provisions of the Code of Civil Procedure, 1908 (5 of 1908) shall,
in their application to any suit in respect of a commercial dispute
of a Specified Value, stand amended in the manner as specified
in the Schedule.
(2) The Commercial Division and Commercial Court shall follow
the provisions of the Code of Civil Procedure, 1908 (5 of 1908),
as amended by this Act, in the trial of a suit in respect of a
commercial dispute of a Specified Value.
(3) Where any provision of any rule of the jurisdictional High
Court or any amendment to the Code of Civil Procedure, 1908
(5 of 1908), by the State Government is in conflict with the
provisions of the Code of Civil Procedure, 1908 (5 of 1908), as
amended by this Act, the provisions of the Code of Civil
Procedure as
amended by this Act shall prevail”.
19. The Schedule to the Commercial Courts Act amends various
provisions of the Code of Civil Procedure and thereby makes significant
departure from the Code. After Order XIII of the Code, Order XIIIA
- “Summary Judgment” has been inserted. Order XIIIA contains the
scope and classes of suits to which Order XIIIA applies, grounds for
summary judgment, procedure to be followed, evidence for hearing of
summary judgment, orders that may be made by Court in such
proceedings for summary judgment, etc. After Order XV of the Code,
Order XVA–”Case Management Hearing” has been inserted. Order
XVA provides for first Case Management Hearing (Rule 1); recording
of oral evidence on a day-to-day basis (Rule 4); powers of the Court
AMBALAL SARABHAI ENTERPRISES LTD. v.
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in a Case Management Hearing (Rule 6); adjournment of Case
Management Hearing (Rule 7); consequences of non-compliance with
orders (Rule 8).  By way of amendment, several rules have been
incorporated to make the matters of commercial disputes on fast track.
In Order XX of the Code – “Judgment”, Rule 1 has been substituted
that within ninety days of the conclusion of arguments, the Commercial
Court/Commercial Division/Commercial Appellate Division to pronounce
the judgment and copies thereof shall be issued to all the parties to the
dispute through electronic mail or otherwise.
20. Various provisions of the Act namely Case Management
Hearing and other provisions makes the court to adopt a pro-active
approach in resolving the commercial dispute.  A new approach for
carrying out case management and strict guidelines for completion of
the process has been introduced so that the adjudicatory process is not
delayed. I have referred to the various provisions of the Act and the
Schedule bringing in amendments brought to the Civil Procedure Code
to deal with the commercial disputes, only to highlight that the trial of
the commercial dispute suits is put on fast track for disposal of the suits
expeditiously.  Various provisions of the Act referred to above and the
amendments inserted to Civil Procedure Code by the Schedule is to
ensure speedy resolution of the commercial disputes in a time bound
manner. The intent of the
legislature seems to be to have a procedure
which expedites the disposal of commercial disputes and thus creates
a positive environment for investment and development and make India
an attractive place to do business.
21. A perusal of the Statement of Objects and Reasons of the
Commercial Courts Act, 2015 and the various amendments to Civil
Procedure Code and insertion of new rules to the Code applicable to
suits of commercial disputes show that it has been enacted for the
purpose of providing an early disposal of high value commercial disputes.
A purposive interpretation of the Objects and Reasons and various
amendments to Civil Procedure Code leaves no room for doubt that
the provisions of the Act require to be strictly construed. If the provisions
are given a liberal interpretation, the object behind constitution of
Commercial Division of Courts, viz. putting the matter on fast track
and speedy resolution of commercial disputes, will be defeated. If we
take a closer look at the Statement of Objects and Reasons, words such
as ‘early’ and ‘speedy’ have been incorporated and reiterated. The
object shall be fulfilled only if the provisions of the Act are interpreted
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in a narrow sense and not hampered by the usual procedural delays
plaguing our traditional legal system.
22. 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(1)(c) 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.
23. On 03.11.2017, a Memorandum of Understanding was
executed between the appellant-plaintiff, respondent-defendant and
Ketan Bhailalbhai Shah-second respondent. As per the terms of MOU,
parties executed a Deed of Conveyance of the land. A mortgage deed
was executed simultaneously along with the MOU with respect to the
part of the land admeasuring 15,000 sq.ft. in favour of the plaintiff. It
was understood between the parties that respondent No.1 would apply
for change of land use permission for the land in question on signing of
the MOU. Mortgage deed was executed by respondent No.1 in favour
of the appellant in order to ensure performance of obligations under
the MOU. But the said mortgage deed was not presented for
registration.
24.
It appears that the trial court has proceeded under the footing
that the parties to the suit more particularly, the appellant-plaintiff seems
to be carrying on business as Estate Agent and to manage land, building,
etc. and the very object as enumerated in Memorandum and Articles
of Association of the appellant-plaintiff company established that the
property in question are being used exclusively in trade or commerce
rather in the business of the plaintiff. As rightly pointed out by the High
Court, there is nothing on record to show that at the time when
agreement to sell came to be executed in 2012, the property was being
exclusively used in trade and commerce so as to bring dispute within
the ambit of sub-clause (vii) of Section 2(1)(c) of the Act. Merely
because, the property is likely to be used in relation to trade and
commerce, the same cannot be the ground to attract the jurisdiction of
the Commercial Court.
AMBALAL SARABHAI ENTERPRISES LTD. v.
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25. In the case of Ujwala Raje Gaekwar v. Hemaben Achyut
Shah 2017 SCC Guj 583, a Special Civil Suit No.533/2011 was instituted
for declaration that the sale deed valued at Rs.17.76 crores executed
by the appellant-original defendant No.1 in favour of respondent No.4
be declared illegal and also, for permanent injunction with respect to
the land in question. The appellants-defendants thereon filed an
application that in sale deed, it has been clearly mentioned that the
agreement relating to immovable property used exclusively in trade or
commerce and falls within the meaning of Section 2(1)(c)(vii) of the
Commercial Courts Act and that the matters above, the value of rupees
one crore are to be transferred to the Commercial Court. Trial court
rejected the said application which was challenged before the Gujarat
High Court. The Gujarat High Court held that the aim, object and purpose
of establishment of Commercial Courts, Commercial Divisions and
Commercial Appellate Divisions of the High Court is to ensure that the
cases involved in commercial disputes are disposed of expeditiously,
fairly and at reasonable cost to the litigant, and if such a suit which is
as such arising out of the probate proceedings and/or is dispute with
respect to the property are transferred to the Commercial Division/
Commercial Court, there shall not be any difference between the
Regular Civil Courts and the Commercial Division/Commercial
Courts
and the object for the establishment of the Commercial Division/
Commercial Courts shall be frustrated.
26. In Vasu Healthcare Private Limited v. Gujarat Akruti TCG
Biotch Limited & Another 2017 SCC OnLine Guj 724, referred to in
extenso by my learned Brother, it was held that “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”.  We entirely agree with the above purposive interpretation
adopted by the Gujarat High Court.
27. The object and purpose of the establishment of Commercial
Courts, Commercial Divisions and Commercial Appellate Divisions of
the High Court is to ensure that the cases involved in commercial
disputes are disposed of expeditiously, fairly and at reasonable cost to
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633
the litigants. Keeping in view the object and purpose of the establishment
of the Commercial Courts and fast tracking procedure provided under
the Act, the statutory provisions of the Act and the words incorporated
thereon are to be meaningfully interpreted for quick disposal of
commercial litigations so as to benefit the litigants especially those who
are engaged in trade and commerce which in turn will further economic
growth of the country. On the above reasonings, I agree with the
conclusion arrived at by my esteemed brother Justice A.S. Bopanna.
Nidhi Jain
Appeal dismissed.
AMBALAL SARABHAI ENTERPRISES LTD. v.
K. S. INFRASPACE LLP & ANR. [R. BANUMATHI, J.]