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Report No. 253

F. Procedural Improvements

(i) Special procedure to be followed in Commercial Courts and Commercial Divisions

3.20.1 In order to take advantage of the best practices in civil procedure followed in commercial courts across the world, specifically the UK and Singapore, we find that the success of the commercial courts depends on the ease with which the commercial dispute moves through the court system and the powers given to the judge to ensure that the trial is conducted fairly and efficiently. For this reason, it is suggested that amendments, as fully described in Schedule of the proposed Bill, be made to the CPC in its application to Commercial Courts and Commercial Divisions in High Courts.

3.20.2 It is recommended that the redrafted procedural provisions of the 2015 Bill contain a clause, which makes it clear that the provisions of the Bill should prevail over the CPC, State amendments to the CPC, and the applicable High Court rules in case of any conflict. The procedural provisions of the Bill, in all other cases, will be supplementary to the existing CPC and High Court rules, but in case of any conflict, the procedural provisions of the Bill will prevail over other legislations.

3.20.3 Some of the key normative changes being suggested in the 2015 Bill are:

(a) Written statements, which are not filed within the thirty day period prescribed by Orders V and VIII of the CPC, can be filed afterwards (subject to a Court's written order and the payment of costs); however, in no case can they be filed beyond one hundred twenty days from the days of summons. In such cases, the defendants shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record.

(b) Pleadings and filing of documents to follow the procedures under the CPC, but subject to stricter timelines, giving the court the power to strike out vexatious and irrelevant pleadings in order to ensure that the trial takes place on relevant issues.

(c) Disclosure and inspection norms that will allow parties to complete discovery of documents efficiently.

(d) A new and separate procedure of "summary judgment" to be introduced where parties can seek judgment of the court summarily at any point of time prior to the commencement of trial, namely at the time of framing of issues.

(e) The court will be empowered to conduct a case management hearing where it will have all the necessary powers required to ensure the proper conduct of a trial within a specified time frame. This will include, inter alia, the power to fix dates for hearing, decide which issues are to be tried and witnesses to be summoned. In addition, the Court will be empowered to impose costs and other penalties on parties for failure to follow the directions set out in a case management hearing.

(f) A new regime of costs to be introduced, providing for "costs to follow event".

(g) Time bound oral arguments to be supplemented with written submissions to be filed mandatorily.

(h) Time bound delivery of judgments within ninety days from the conclusion of arguments.

3.20.4 The above normative changes will be supplemented by Practice Directions that will be issued by the High Courts so as to facilitate efficient and smooth functioning of the Commercial Courts and Commercial Divisions. Such Practice Directions shall also serve as guidance to both judges and practicing advocates in respect of the procedures that apply to Commercial Divisions and Commercial Courts.

3.20.5 The Commission's recommendations on case management are consonant with the Supreme Court's directions in Rameshwari Devi v. Nirmala Devi, (2011) 8 SCC 249, at para 52, where the Court advocated for case management observing that:

At the time of filing of the plaint, the trial Court should prepare complete schedule and fix dates for all the stages of the suit, right from filing of the written statement till pronouncement of judgment and the Courts should strictly adhere to the said dates and the said time table as far as possible. If any interlocutory application is filed then the same [can] be disposed of in between the said dates of hearings fixed in the said suit itself so that the date fixed for the main suit may not be disturbed.

Commercial Division and Commercial Appellate Division of High Courts and Commercial Courts Bill, 2015 Back

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