1. We have heard Sri Kaushalendra Nath Singh and Sri A.B. Singhal, learned counsel for New Okhla Industrial Development Authority; Sri Vishnu Gupta, learned Senior Advocate, assisted by Mr. S.O.V.S. Chauhan, learned counsel for M/s Pathik Software Education Private Limited and Sri Shashi Nandan, learned Senior Advocate, assisted by Ms. Shreya Gupta, learned counsel for M/s Innova A.M. Tech L.L.P., Gautambuddh Nagar.

2. Both appeals arise out of common judgment and decree dated 28.3.2022 passed by the Presiding Officer, Commercial Court, Gautam Budh Nagar in Suit (Comm) No.167 of 2021 (M/s Pathik Software Education Pvt. Ltd. vs. CEO New Okhla Industrial Development Authority and two others).

3. Learned counsel for the parties agreed that both appeals may be disposed of at this stage without calling for original record as the relevant records alongwith the pleadings are already appended alongwith the appeals and they have no objection, in case these appeals are decided without summoning the record.

4. With the consent of learned counsel for the parties, both these appeals are being decided by a common judgment.

5. The brief facts, which led to the present situation, are that M/s Pathik Software Education Private Limited (plaintiff company), Pandav Nagar, which is plaintiff in the suit, now referred as plaintiff company, is a Private Limited Company having its registered office at E-52, Pandav Nagar, Delhi-110092 and it is engaged in the business of education etc. The plaintiff company was allotted a land bearing no.30 area 2100 sq. mtrs. situated at Sector 142 Noida, District Gautam Budh Nagar, U.P. on 17.02.2006 by New Okhla Industrial Development Authority, which is defendant no.1 in the suit, referred as defendant authority and the lease deed of the plot in question was executed on 19.01.2007.

6. The relevant clauses of the lease deed are as follows:-

“LEASE DEED.

This lease deed made on this 19th day of January in the year Two Thousand Seven between New Okhla Industrial Development Authority a body corporate constituted under Section 3 of the U.P. Industrial Area Development Act 1976 (U.P. Act No.6 of 1976) hereinafter called the Lessor which expression shall unless the context does not so admit include its successors of the first part and M/s Pathik Software Education Pvt. Ltd., a company within the meaning of Company Act, 1956 having its registered office E-52, Pandav Nagar, Delhi-92, through its Director Smt. Brijesh Singh W/o Sh. Joginder Singh R/o E-292A, Sector-22, Noida, Distt. G.B. Nagar, U.P., hereinafter called Lessee which expression shall unless the context does not so admit includes its successors, administrators, representatives and permitted assignees of the other part.

...

NOW THE LEASE DEED WITNESSES AS FOLLOWS:

1. That in consideration of total premium of Rs.79,25,400.00 (Rupees Seventy Nine Lac Twenty Five thousand Four hundred only) towards the land premium calculated @ Rs.3774/- per sq. mtrs out of which 30% i.e. 23,77,620.00 (Rupees Twenty Three lac Seventy Seven thousand Six hundred Twenty only) has been paid by the lessee to the lessor the receipt where of the lessor hereby acknowledges and balance Rs.55,47,780.00 (Rupees Fifty Five lac Forty Seven thousand Seven hundred Eighty only) shall be paid to the lessor in Sixteen half yearly equal installment alongwith interest @ 11% per annum compounded half yearly as per the following:

1st instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2006.
2nd instalmen.	Rs.3,46,737.00 + Interest on or before 16.02.2007.
3rd instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2007.
4th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2008.
5th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2008.
6th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2009.
7th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2009.
8th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2010.
9th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2010.
10th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2011.
11th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2011.
12th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2012.
13th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2012.
14th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2013.
15th instalment.	Rs.3,46,737.00 + Interest on or before 16.08.2013.
16th instalment.	Rs.3,46,737.00 + Interest on or before 16.02.2014.

…..

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9. That the lessee will complete construction and obtain occupancy certificate from the building cell department within the validity period of the approved building plans and put the same in operation as per plans approved by the lessor and as per provision of clause No.13 of this lease deed for allotment and cancellation of plot. In case such allottee/lessee who are interested to avail exemption of stamp duty has to obtain approval of Development Plan within 18 months from the date of registration of Lease Deed from the competent authority of the lessor and complete the 40% of the total permissible covered area on the allotted plot within 3 years from the date of handing over of possession and also have to complete whole construction within five years from the date of handing over of possession.

In the event of Lessee’s not complying with above clause Bank Guarantee submitted by the Lessee will be invoked and encashed.

Provided that the lessee has the option of availing exemption from stamp duty shall execute an Agreement and submit Bank Guarantee as per provision of Government order No.KNO5-305/11-2005-500 (136) 2003 Dt. 19.01.2005, 3014/76-6-05/500 (40)/2000 dated 19.12.2005, and 2168/78-2- 2005/46 IT/2005 dated 30.12.2005.

The Lessee is not willing to avail the benefit of exemption of stamp duty vide undertaking dt. 19.1.2007.

……

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13. (A) The allottee/Lessee will complete construction and obtain occupancy certificate from the competent Authority of the Lessor within the validly period of the approved building plan. The Lessee/Allottee shall ensure the functioning on the allotted plot as per schedule give below.

PLOT UPTO 1000 SQ. MTRS.

Within two years from the actual date of possession.

PLOTS ABOVE 1000 SQ. MTRS. BUT UPTO 2000 SQ. MTR.

Within three years from the actual date of possession.

PLOTS ABOVE 2000 SQ. MTRS. BUT UPTO 4000 SQ. MTRS.

PLOT ABOVE 4000 SQ. MTRS.

Within five years from the actual date of possession.

B. In case of non adherent to the aforementioned schedule for functioning, the cancellation of allotment and / or determination of Lease Deed with forfeiture of money would be effected as per rules and the possession of the plot would be resumed by the lessor with structure thereof, if any and the allottee/lessee will have no right to claim compensation thereof. However, in exceptional circumstances, an extension may be allowed by the lessor on payment of such charges and subject to terms and conditions, as deemed fit by the lessor.

C. In the event of an extension, extension charges @ 4% of the premium would be chargeable for grant of extension for each year on pro data monthly basis. The rate of extension charges as mentioned above may be reviewed by the lessor. In the event of extension not being granted, cancellation may be exercised following with revocation of lease deed with forfeiture amount as per then prevailing policy of the lessor, in such an event the lessee will be at liberty to remove construction if any, in such eventuality. The rate of extension charges as mentioned above may be revised by the Lessor/Chief Executive Officer without notice.

It is further classified that the provision of clause no.9 of this lease deed shall not of applicable in respect of allotment and cancellation of plot as this clause No.9 is applicable in cases of those lesseess who one interested in availing exemption from stamp duty only.

.…

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26. And it is hereby agreed and declare by and between the parties to these present as follows:

i) Notwithstanding anything contained herein above, if in the opinion of the lessor (whose decision shall be final and binding) any breach or violation of terms and conditions of the registration/allotment/lease deed or non-deposit of dues & any of the covenants/conditions herein before contained and is to be observed and performed and in particular and without prejudice to the generality of the sub clause if lessee transfer (s) assign (s) relinquish (s) or mortgage (s) the whole of the demised premises before construction of a building on its part as herein before provided within the period mentioned above or if the lessee or the persons in whom the right is hereby created are adjudged insolvent.

ii) It shall be lawful for the LESSOR, without prejudice to any other action, to re-enter the demised plot or any part thereof and determine this lease and forfeit the amount as per rules and thereupon.

iii) If at any time of re-entering the demised plot shall not have been occupied by nor any building constructed by LESSEE, the LESSOR may reallot the demised plot and refund the payment if any after making adjustment as required without deducting arrears of lease/interest/extension/ charges and other charges as per rules.

iv) If at any time- entering the demised plot shall not have been occupied by any building constructed by the LESSEE, thereon, the LESSEE shall within a period of three months from the date of re-entry remove from the demised plot all erection or building fixtures and things which at any time and during the said terms shall be affixed or get upon the demised plot and leave the same in a good condition as it was on the date of demise, and default of the same shall become the property of the LESSOR without payment of any compensation to the LESSEE for the land and building structure and things therein within the LESSEE may be paid such amount as may work out in accordance with the principle given in the sub-clause (ii) above, provided that the LESSOR may at its option agree to purchase from the LESSEE his interest in the demised plot.

v) Any loss suffered by the LESSOR on a fresh grant of the demised plot breaches of conditions as a aforesaid on part of LESSEE for or any person claiming through or under him shall be recoverable by the LESSOR.

vi) All notice order or other documents required under the terms of the lease or under U.P. Act, No.6 of 1976 or any rule or regulation made thereunder shall be deemed to be duly served as provided under Section 43, of U.P. Urban Planning and Development Act, 1973 as re – enacted and notified by U.P. Residents Act, 1974 (Act No.30 of 1974) re – enacted with modifidication.

vii) The provisions of U.P. Industrial Area Development Act, 1976 and as any rules and regulations framed under the act or any direction issued shall be binding on the LESSEE and his/her/their successive.

viii) All power exercised by the LESSOR under this lease may be exercised by Chairman / CEO. The LESSOR may also authorise any of its officers to exercise all or any of the powers by it under this rule.

ix) Any relaxation or concession granted by the LESSOR to LESSEE shall not in any way prejudice the legal rights of the LESSOR.

x) Any disputes arising with regards to this deed shall be subjected to the jurisdiction of Civil Courts at Gautam Budh Nagar or High Court of Judicature at Allahabad.

xi) The land is in peaceful possession of the LESSOR and is being handed over to the LESSEE free from any encroachment and obstruction.

xii) The Chairman / CEO of the LESSOR reserves the right to make such amendments, additions alterations or modification, in terms and conditions of the lease from time to time as he may consider just and reasonable.

xiii) Subject to the sub- clause (ix) in case of any clarification or interpretation regarding these terms and conditions of the lease deed, the decision of Chairman. CEO of the LESSOR will be final and binding on the LESSEE.

xiv) The lessee shall complete the project within stipulated period as mentioned in clause 9 and 13 of lease deed. In case the lessee fails to comply with the terms and condition of allotment letter, lease deed brochure or not make the project functional within stipulated period as mentioned in clause 9 and 13 of lease deed. That action shall be taken as per rules and regulations of the Authority regarding cancellation.

xv) The terms and conditions of brochure, allotment letter dt. 17.02.2006, lease, building bye – laws as amended from time to time shall be binding on LESSEE.”

7. Admittedly, the possession of the land was handed over to the plaintiff company on 01.02.2007 and in terms of the lease deed the plaintiff company has to complete the construction within five years from the actual date of possession i.e. 01.02.2007 and further to pay the defendant authority in terms of the instalments fixed in the lease deed. Once the plaintiff company failed to comply with the aforesaid conditions then the defendant authority issued notices to the plaintiff company on 19.12.2013, 26.02.2014, 17.06.2020 and 14.07.2020 but the said notices were not responded by the plaintiff company. Finally, the defendant authority vide order dated 07.01.2021 had cancelled the lease deed executed in favour of the plaintiff company.

8. Thereafter, the plaintiff-company had filed a Writ C No.13225 of 2021 (M/s Pathik Software Education Pvt. Ltd. vs. State of UP and 2 others) before this Court assailing the validity of the order dated 07.01.2021. However, the writ petition was dismissed on 27.7.2021 as withdrawn with liberty to file a fresh with better particulars. Meanwhile, the defendant authority had proceeded to make allotment of the plot in question in favour of M/s Innova AM Tech LLP, which is defendant no.2 in the suit, referred as defendant company.

9. The plaintiff company instituted a suit under the Commercial Courts Act registered as C.S. (Comm) No.167 of 2021 (M/s Pathik Software Education Pvt. Ltd. vs. CEO New Okhla Industrial Development Authority and others) in the Commercial Court, Gautam Budh Nagar seeking following reliefs:-

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10. The defendant authority had filed objections on 25.08.2021 under Order XXXIX Rule 1 & 2 of C.P.C. and taken specific stand that the Commercial Court had no jurisdiction to try and decide the suit because the provisions of the Order VII Rule 11 of C.P.C. are applicable. Section 2 (1) (b) of the Commercial Courts Act, 2015 defines the meaning of “Commercial Court” and sub-section (1) (c) of Section 2 defines the meaning of “Commercial Dispute”, wherein every category of the commercial disputes has been defined but nowhere such type of material is available, which co-relates to the present dispute under the suit. Therefore, the present suit of the plaintiff company is barred by the provisions of Section 9 of C.P.C.. The defendant authority has also taken an objection that the civil suit is barred by the provisions of Sections 34, 38 & 41 of Specific Relief Act. The suit of the plaintiff company is also barred by the provisions of Section 12A of Commercial Court Act, 2015.

11. The defendant authority had also filed detailed written statement (WS) on 04.09.2021 and resisted the suit contending that before cancelling the plot in question the defendant authority sent letters/notices dated 19.12.2013, 26.02.2014, 17.06.2020 and 14.07.2020 to the plaintiff company at the available address and the address given by the plaintiff company in the lease deed but the notice dated 17.06.2020 was returned back with the remarks “Bina Pata Bataye Chhod Gaye” (left without giving the address). Therefore, it was incorrect that the plaintiff company had not received the letters. The objection was also taken that at both the addresses i.e. of the address of the company and also at the address of the Director, the letter dated 07.01.2021 was served to the plaintiff company and also the Director of the company.

12. The plot was duly allotted in favour of the plaintiff company on 17.02.2006 @ Rs.3700/- per sq. meters and the location charges @ 2% were also added. Accordingly, the premium rate was charged @ Rs.3774/- per Sq. meters only and within 30 days from the date of allotment letter, the plaintiff company had to deposit 30% amount of the total premium, which was to the tune of Rs.18,35,755/- including one year lease rent of Rs.1,98,135/- and the balance amount of 70% of the total premium alongwith interest @ 11% was to be paid in instalments by the plaintiff company. After allotment, the lease deed was executed on 19.01.2007 and the possession of the plot in question was also handed over to the plaintiff company on 01.02.2007. While filing the written statement, specific objection was also taken to the effect that the plaintiff company had incorrectly stated that he had deposited total premium but in fact, the plaintiff company had never deposited the balance amount of the lease rent against the plot in question. Once the terms and conditions of the lease deed had been flouted by the plaintiff company and it failed to clear the outstanding amount then the defendant authority served the demand notice dated 26.02.2014 to pay the amount of Rs.1.12 crores upto 15.03.2014. Thereafter, another letter was served on 17.06.2020 to pay the amount of Rs.1,69,00,000/- within 15 days from the receipt of the letter but the said letter was returned back with the aforementioned remarks. When the plaintiff company did not pay the outstanding amount, the defendant authority issued a demand notice on 14.07.2020 to pay Rs.1,69,00,000/- within seven days. It is also claimed that the defendant authority had issued a demand notice on 13.12.2019 for Rs.2,69,78,938/- but subsequently, through another demand notice dated 03.02.2020 the amount to the tune of Rs.50,00,000/- was adjusted, which was already deposited by the plaintiff company on 16.05.2015 and accordingly, amended demand notice was served. Before cancelling the lease deed of the plot in question the defendant authority had sent various show cause notices but inspite of the repeated notices the plaintiff company did not respond to the notice, and neither deposited the amount in question nor raised any construction over the plot in question and further not obtained completion certificate after raising the construction within five years from the actual date of possession, which all were mandatory as per the lease deed. Therefore, the said act was in violation of Clause 13 (A) of the lease deed and accordingly, the defendant authority had cancelled the allotment on 07.01.2021 and taken back the possession of the plot in question on 18.02.2021. Thereafter, the same was allotted to the defendant company on 17.06.2021 under “Institutional Plots Scheme OES 2020-2021” and the defendant company had deposited the sale consideration.

13. In the suit proceeding the defendant company had also filed written statement stating therein that the defendant company is engaged in the business of IT Software Products and Services. It applied for allotment of an institutional plot and made a pre-deposit of Rs.31,14,300/- as required in the public notice dated 22.02.2021. Thereafter, the defendant authority decided to allot the plot in question vide allotment letter dated 17.06.2021 and as per the terms of the allotment, the defendant authority was required to make a further payment of 30% of the total value of the plot, amounting to Rs.1,11,49,194/-, which was deposited by the defendant company on 22.06.2021. Thus, the defendant company has made payment of Rs.1,42,63,494/-. The defendant company has not only made the payment of huge amount to the defendant authority but it is also holding the balance payment of Rs.2,13,95,241/-, which is payable to defendant authority in respect of the plot. Total cost of the project is more than Rs.37 crores and the defendant company has already arranged the said amount but till date on account of the pendency of the said proceeding, it cannot utilise the said amount for any other purpose.

14. The defendant company took an objection in written statement that admittedly, the plaintiff company has breached the terms of the lease deed dated 19.01.2007 and it had neither paid the balance amount nor had commenced the construction on the plot within the stipulated period of five years. Further the plaintiff company had not sought any extension of time for completion of the construction. As per lease deed dated 19.01.2007 the maximum period of time for completing the construction including two year’s extension was seven years, which had already expired in the year 2014 and consequently, the lease deed dated 29.01.2007 was cancelled by the defendant authority. The plaintiff company made a default in payment of instalments under the lease deed dated 19.01.2007 and as such, it was not entitled to any relief from the Commercial Court. The defendant company had also obtained the balance sheets of the plaintiff company for the years 2015-2019 from the ‘Ministry of Corporate Affairs’, which indicated that the plaintiff company was an inactive, shell company and it has no business operations, no turnover and nil income. The amount of Rs.1,00,78,716/- paid to the defendant authority was reflected in its balance sheet as long term unsecured loans taken by the plaintiff company. The plaintiff company did not has any money, whatsoever, to either make the balance payment due to the defendant authority qua the plot in question or to make the construction on the plot in terms of the lease deed. It was also averred in the written statement that the allotment of an institutional plot was made to business entities by defendant authority on the concessional rate to promote business and employment. The plaintiff company with no operations, nil turnover and no business record whatsoever, was neither legally nor morally entitled to the benefit of the allotment of the said plot. The plaintiff company was only incorporated on 19.12.2005 just to procure the lease rights of the said plot.

15. The Commercial Court, after exchange of the affidavits and pleadings, had framed three issues namely (i) jurisdiction of this Court to entertain the present matter; (ii) application under Order 13A CPC and (iii) application under Order XXXIX Rules 1 and 2 CPC. Firstly, the Commercial Court had proceeded to deal with the jurisdiction of the Court to entertain the suit (issue no.i) and found that admittedly “Memorandum of Article of Association” of the plaintiff company stated that it was a company formed for earning profits and further the lease deed was executed by the defendant authority in favour of the plaintiff company in the institutional area. Again the plaintiff company was incorporated with an intention to earn profits by conducting business of computer/software training institute. The Commercial Court had also taken note of the fact that the plaintiff company was a registered company under the Companies Act, 1956 and works for gain and profit. The terms of the lease deed, which was executed between the parties, speaks of development of suit property as computer/software institute etc. for its gains/profits. The lease deed was also executed between the parties, which was itself a contract between the parties and the allegation of the plaintiff company against the defendant authority was breach and violation of the terms of the said lease deed i.e. contract. Therefore, as there was breach of contract the Commercial Court had every jurisdiction to entertain the matter as there was a commercial dispute. Therefore, the dispute fell within the ambit of Section 2 (1) (c) (vii) of the Commercial Courts Act, 2015. The Commercial Court held that the present dispute between the parties is undoubtedly a commercial dispute in terms of Section 2 of the Commercial Courts Act, 2015 and thus, the Commercial Court has jurisdiction to decide the dispute.

16. So far as the second issue with regard to the application of the defendant company under Order XIIIA of the CPC was concerned, the Commercial Court found that in the present case, the only dispute raised by the plaintiff company was that the plaintiff company was not served with the demand notice and subsequent cancellation notice as per the terms of the lease deed resulting in cancellation of the land in question and the plaintiff company had defaulted in making payments to the defendant authority as per the terms of the lease deed. The Commercial Court found that as there was dispute with regard to the payment, nonpayment, sending of notice/non-sending of notice at various addresses of the plaintiff company and all other relevant issues in the present dispute were already on record, therefore, no evidence was required to be adduced. The Commercial Court had proceeded to decide the actual dispute based upon the pleadings of the parties and official record filed by the defendant authority before the Court. It also opined that only dispute between the parties were that the plaintiff claimed non-receipt of payment notice on its registered office as per lease deed and the defendant’s plea was regarding non-payment of dues and nonconstruction of the building on the leased premises as per lease deed. The Commercial Court further found that the defendant company had no substantial right against the plaintiff company. There is no contract between the plaintiff company and the defendant company and only rights of the defendant company was against the defendant authority. Since there was no dispute with regard to the relevant facts between the parties and thus, the Commercial Court was of the opinion that the suit be decided summarily under Order XIII of the CPC.

17. Thereafter, the Commercial Court had proceeded to discuss the case on its merits qua service of notice, non-payment of dues/nonconstructions on the leased land property and the relevant law and found that admittedly, the aforesaid lease deed was executed between the plaintiff company and the defendant authority on 19.01.2007, wherein rights and obligations of the parties were clearly mentioned. The lease deed is a complete contract between the plaintiff company and the defendant authority. As per the terms of the lease deed the plaintiff company was to make the entire payment of the consideration amount to the defendant authority within the stipulated period and in case of default the plaintiff company was liable to pay interest to the defendant authority @ 14% and allotment was also liable to be cancelled as per Clause-2 of the allotment letter dated 17.02.2006. As per the lease deed dated 19.01.2007 the entire consideration amount was to be paid by 16.02.2014, out of which Rs.23,77,620/- was paid at the time of execution of the lease deed and the remaining amount of Rs.55,47,780/- plus interest was to be paid in 16 equal half yearly instalments of Rs.3,46,737/- plus interest. In case of default the plaintiff company was required to pay 14% interest compounded half yearly on the defaulted amount instead of 11% within the time period i.e. upto 16.02.2014. The plaintiff company was to complete the construction at the site within five years from the date of actual possession and in case of non-compliance of the construction, the allotment was liable to be cancelled.

18. The Commercial Court found that purported notices dated 30.06.2020 and 14.07.2020 were sent to the plaintiff company, wherein a demand of Rs.1,69,00,000/- was raised against the plaintiff company and these dues included interest for non-payment of amount and penalty for non-construction on the suit property from the year 2013. As per record of the defendant authority, the amount due till 31.12.2020 was of Rs.1,96,10,802/- which included an amount of Rs.25,09,710/- for nonconstruction and the defendant authority had extended the time of construction on payment of extension charges. The Commercial Court further found that the demand notices dated 17.06.2020 and 14.07.2020 were not received by the plaintiff company and they were returned back with the endorsement “left without giving the address”. The Court found that both the notices dated 17.06.2020 and 14.07.2020 were sent only at the residential address of one of the Directors of the plaintiff company and no notice was sent at the registered office of the plaintiff company at E-52, Pandav Nagar, Delhi-110092. In the lease deed between the plaintiff company and the defendant authority, the registered office of the plaintiff company was shown as E-52, Pandav Nagar, Delhi – 110092 and the residential address of one of the Director Smt. Brijesh Singh was shown as E-292A, Sector 22, Noida, U.P. It was also alleged that the cancellation notice of the plot was sent at both the addresses i.e. registered address – E-52, Pandav Nagar, Delhi – 110092 and E-292A, Sector 22, Noida, District Gautam Budh Nagar, U.P.. From the aforesaid facts, the Commercial Court opined that the demand notices dated 17.06.2020 and 14.07.2020 were not sent at the registered office of the plaintiff company but were rather sent at the residential address of one of it’s Director, which was in breach of Section 43 of U.P. Urban Planning and Development Act, 1973.

19. The Commercial Court further found that the cancellation notice dated 07.01.2021 was sent to both the addresses of the plaintiff company i.e. registered office and residential address of one of the Director of the plaintiff company and thus, it cannot be said by the defendant authority that the demand notice was not required to be sent at the registered office or the demand notice was duly served as per Section 43 of the Act, 1973. The Court further observed that the cancellation notice was sent to the plaintiff company at both the addresses but the demand notice was sent at the residential address of one of the Director of the Company and it was not sent at the registered address of the plaintiff company. There was breach on the part of the plaintiff company in adhering to the terms of the lease deed. However, the aforesaid breach was condonable and the defendant authority itself condoned this breach by raising a demand to the tune of Rs.1,69,00,000/- which included the penalty for non-construction on the plot and the interest on the late payment. The Commercial Court held that the defendant authority had the power to cancel the lease deed but it was not exercised as per the terms of the lease deed and thus, the cancellation notice dated 07.01.2021 was found to be in violation of terms of the contract between the parties and consequently, all subsequent actions were unsustainable. After considering the evidence, the Commercial Court by judgment and decree dated 28.3.2022 decreed aforesaid Suit (Comm) No.167 of 2021 with following directions:-

“i) Cancellation notice dated 07.01.2021 cancelling the lease deed dated 19.01.2007 of land bearing Plot No.30, measuring 2100 sq. mtrs. Situated at Sector 142 Noida Gautam Budh Nagar, U.P. by New Okhla Industrial Development authority, is declared null and void and hence set aside;

ii) all consequential actions subsequent to the aforesaid cancellation notice dated 07.01.2021 are also declared as null and void;

iii) Defendant No.1 is directed to issue fresh demand notice for recovery of pending dues/penalties against the plaintiff upto 31.03.2022 within 15 days from the date of the judgment. It is clarified that all benefits (waivers on penalty, interest etc.) which are available to the other allottees similar to the plaintiff shall also be given to the plaintiff as per rules of the authority;

iv) the plaintiff is at liberty to pay the aforesaid amount within 30 days from the receipt of demand notice as mentioned in para (iii) above. It is clarified that in case the plaintiff fails to make the payment of entire dues of the Defendant No.1 within 30 days the Defendant No.1 shall be at liberty to take action as per the terms of the lease deed;

v) the Defendant No.2 is at liberty to avail all its contractual rights against the Defendant No.1 (including re-allotment/refund with interest etc.) and this judgement is not affecting any legal right of the Defendant No.2 against Defendant No.1;

vi) all pending applications including application under Order XXXIX Rules 1 and 2 CPC etc. stand disposed of in the light of above order.

vii) no order as to cost.”

20. Sri Kaushalendra Nath Singh, learned counsel for the defendant authority submitted in support of First Appeal Defective No.218 of 2022 that the category of commercial disputes, which are in jurisdiction of the Commercial Court, are enumerated in the Commercial Courts Act, 2015. Admittedly, the plaintiff company did not commence any construction on the plot in question within stipulated period of five years and further the plaintiff company had not sought extension of time for constructions in terms of Clause 13B and 13C of the lease deed. The plaintiff company failed to adhere the payment schedule contained in Clause-1 of the lease deed dated 19.01.2007 and made default in payment as per the lease deed, despite receipt of show cause notices dated 19.12.2013 and 26.02.2014 from the defendant authority. The plaintiff company had not made any sincere efforts to comply with the terms of the lease deed dated 19.01.2007. Even though the land was free from any encroachment and possession was also handed over to the plaintiff company but the plaintiff company failed to comply its obligations by not paying the future instalments, and not starting the business within the stipulated time for which the plot was allotted at a consessional rate. The plaintiff company did not seek extention of time, they had virtually abandoned the project. Ultimately, the defendant authority had no other option except to cancel the allotment made in favour of the plaintiff company in terms of Clause 13 of the lease deed and the plot was re-allotted to the defendant company on 17.06.2021. The plaintiff company did not dispute receipt of the show cause notice dated 19.12.2013 sent by the defendant authority seeking an explanation for failure to raise constructions on the demised plot within the time stipulated in the lease deed.

21. Learned counsel drew attention to the relief sought in the suit and submitted that the suit of the plaintiff company was valued at Rs.80 lakhs whereas, the valuation of the plot was much higher. As such, the suit filed by the plaintiff company was undervalued and the court fees paid was insufficient. The valuation of a suit has to be in accordance with the Court Fees Act, even if the relief pertains to a right in immovable property. There is no provision in the lease deed, which mandates service of prior notice upon the lessee (plaintiff company) prior to cancellation/termination of the lease deed. The Commercial Court illegally concluded that the demand notices were not sent on the registered address of the plaintiff company and as such, the cancellation of the lease deed was without requisite notice as mentioned in subclause (vi) of Clause 26 of the lease deed. Sub-clause (vi) of clause 26 of the lease deed was not at all attracted to the case at hand inasmuch as the allotment made in favour of the plaintiff company was cancelled in terms of Clause 13B and 13C of the lease deed. Under the lease deed the defendant authority was not required to send a notice prior to cancellation of the allotment. The notice was sent to the Director of the plaintiff company at E-292A, Sector-22, NOIDA, which was the address for all correspondence by the plaintiff company. There was sufficient compliance of the provisions of Section 43 of the Act, 1973. The plaintiff company was using the aforesaid address as its place of business from the date of application for allotment of the land in question till the date of last payment by the plaintiff company. In the plaint the only case set up by the plaintiff company to challenge the cancellation of lease deed was that the notices dated 13.12.2019, 03.02.2020, 17.06.2020 and 14.07.2020 were not sent to the registered address of the plaintiff company and the same were sent to E-292A, Sector-22, NOIDA. The Commercial Court had erred in law in concluding that the lease deed was cancelled without serving the requisite notice.

22. Learned counsel for the defendant authority submitted that the plaintiff company had challenged the notice dated 07.01.2021 in Writ C No.13115 of 2021 and the same was dismissed as withdrawn. The suit was not maintainable and the Commercial Court had no jurisdiction to decide the same as per Order VII Rule 11 of CPC. Section 2 (1) (b) of Commercial Court Act, 2015 defines the meaning of “Commercial Court” constituted under sub-section (1) of Section 3. Further under Section 2 (1) (c) the meaning of Commercial Dispute is defined. Every category of the commercial disputes has been defined but, nowhere, such type of claim is available, which co-relates to the present dispute under the suit. Therefore, the present suit of the plaintiff is barred by the provisions of Section 9 of CPC. The Commercial Court failed to consider that the plaintiff company has become a victim of its own wrongs and there is no law or grounds to save the illegal interests of the plaintiff. The Commercial Court also failed to realize that the suit was barred by the provisions of Sections 34, 38 and 41 (e) of the Specific Relief Act, 1963 and further the suit was barred by the provisions of Section 12A of Commercial Court Act, 2015.

23. Sri Kaushalendra Nath Singh further submitted that the lease deed did not contain any provision for issuance of notice before cancellation in case of breach of the lease deed by the plaintiff company, it was an admitted fact that the show cause notices were sent to the plaintiff company in the years 2013 and 2014, which were duly received by the plaintiff company, address was allegedly changed only in the year 2015. Despite receipt of these notices, the plaintiff-company did not take any concrete steps to rectify the breaches or even asked for further time for carrying out construction. The Commercial Court erred in law in not appreciating this aspect of the matter and further committed procedural illegality in deciding the application (42-Ga) under Order 13A CPC and interim injunction application (6GA) under Order XXXIX Rules 1 and 2 CPC alongwith the suit itself vide the impugned judgement. The Commercial Court further exceeded its jurisdiction in directing the defendant authority to provide to the plaintiff company “all benefits (waiver of penalty, interest etc.) which are available to the other allottees”, while raising fresh demand for recovery of pending dues/penalties. Section 2 (1) (c) (vii) of Commercial Courts Act, 2015 will come into play only if the lease deed is relating to immovable property 'used' exclusively in trade or commerce. Referring to the terms of lease deed and the averments made in the plaint, it was submitted that the land was given on lease for conducting business, which was yet to commence and therefore, the lease deed was not one relating to property 'being used' for trade or commerce, but property 'to be used' for such purpose. In support of his submission, he had placed reliance on the judgement of Hon’ble Supreme Court in Ambalal Sarabhai Enterprises Ltd. vs. K.S. Infraspace LLP & another. (2020) 15 SCC 585 [LQ/SC/2019/1546] .

24. Sri Shashi Nandan, learned Senior Advocate assisted by Ms. Shreya Gupta, Advocate for defendant company has made detailed submissions referring to the documents to contend that the plaintiff company has not adhered to the payment schedule contained in Clause1 of the lease deed and has defaulted in the payment of the dues payable under the lease deed despite receipt of show cause notices dated 19.12.2013 and 26.02.2014 sent by the defendant authority. Admittedly, the plaintiff had not completed the construction or obtained completion certificate after raising the construction within five years of from the actual date of possession. Neither the plaintiff company sought any extension of time for construction nor paid 4% extension charges in terms of Clause 13-B & C of the lease deed. The defendant authority was well within its rights to have cancelled the lease deed in terms of Clauses 13-B and C of the lease deed. It was open to the defendant authority to re-enter the lease premises in case the same was not occupied and no building had been constructed thereon by the lessee (plaintiff company) and the plot could be re-allotted by the defendant authority under Clause 26-III of the lease deed. The plaintiff company has not disputed receipt of show cause notice dated 19.12.2013 sent by the defendant authority seeking an explanation for non-construction on the allotted plot within the stipulated time and further it did not offer any explanation whatsoever in the plaint filed before the Commercial Court as to what steps the plaintiff company took to seek further extension of time for construction. The plaintiff company received a show cause notice dated 26.02.2014 from the defendant authority demanding an amount of Rs.1,12,00,000/- by 15.03.2014 but the plaintiff deposited only Rs.50,00,000/- on 16.05.2015. The plaintiff failed to explain as to why it did not comply with the demand made vide the said notice and what steps the plaintiff took to remedy the breach and default after the receipt of notice dated 26.02.2014 from the defendant authority. At no point of time the plaintiff company had informed to the defendant authority regarding change of its address, viz E-292A, Sector 22, Noida. In fact, right from the date of application for allotment till the date of last payment, the plaintiff company was using the said address for all communication purposes, even the same address is mentioned in the recital of the lease deed. The plaintiff company had also mentioned the same very address to be its address even in the year 2021, when it had filed Writ C No.13225 of 2021 before this Court, which was dismissed as withdrawn.

25. The learned Senior Advocate for the defendant company further submitted that the defendant company had filed a detailed written statement indicating, therein, that the defendant company had obtained the balance sheet of the plaintiff company for the years 2015-19 from the Ministry of Corporate Affairs, wherein, the plaintiff company was infact shown as an inactive company, which has no business operations, no turnover and no income. The amount of Rs.1,00,78,716/- paid by the plaintiff company to the defendant authority in respect of the said plot was reflected in its balance sheet as long term unsecured loans taken by it. At the relevant point of time the plaintiff company did not have any money whatsoever to either make the balance payment due to the defendant authority or to make the construction on the plot as required under the terms of the lease deed. He submitted that the allotment of institutional plot at special rates was made to business entities by the defendant authority to promote business and employment in the Noida. However, the plaintiff company with no operations, nil turnover and no business, was neither legally nor morally entitled to benefit from such allotment. The plaintiff company was incorporated on 19.12.2005 before the process of bidding of the plot in question and it was formed only to procure the lease rights of the said plot at discounted allotment rates so as to later sell it at premium in the market. The defendant company has already invested a sum of Rs.1,42,63,494/- (Rs.1,11,49,194/- + Rs.31,14,300/-) for the plot in suit and the remaining payment, which is to be made upon execution of the lease deed, has been kept on hold by the authority. The project proposed to be implemented by the defendant company on the plot in question was worth more than Rs.37 crores and has potential of providing employment to hundreds of persons. The allotment was made by the defendant authority in favour of the defendant company upon perusal of the project report submitted by it. The averments in the written statement filed by the defendant company remained unrebutted by the plaintiff company and the Commercial Court did not take it into consideration and made observations that the defendant company has no substantial right against the plaintiff as there is no privity of contract between the plaintiff and the defendant company.

26. Sri Shashi Nandan, learned Senior Advocate further submitted that before the Commercial Court, it was not the case of the plaintiff company that no breach of the terms of the lease deed was committed by it. The plaintiff company had challenged the cancellation of lease only on the ground that the purported notices were not sent at registered address of the plaintiff company office, rather sent at the place, which were already abandoned by the plaintiff company and further no notice was published or affixed. He submitted that the lease deed did not contain any such provision for issuance of notice before cancellation in case of breach by the lessee. It is an admitted fact that the show cause notices were sent to the plaintiff by the defendant authority as early as in 2013 and 2014, which were duly received by it whereas the plaintiff had claimed in para 11 of its plaint that its address changed only in 2015. Despite receipt of the said notices, the plaintiff company took no steps to rectify the breaches. The plaintiff relied upon the provision of Section 43 of the Act, 1973, which simply stipulates that any notice required to be sent to a company under the provisions of the Act, 1973, it may be sent at its registered office or its principal office or its place of business. The consistent use of the said address by the plaintiff itself in all its documents including the lease deed shows that the plaintiff projected the said address as its place of business and the provisions of the Act, 1973 do not provide for any prior notice to be sent to an allottee/lessee prior to cancellation and in case of breach of the terms of the lease deed, the notices were duly sent by the defendant authority to the plaintiff company at its place of business.

27. Ms. Shreya Gupta, Advocate for the defendant company had also made detailed submissions and referred documents (written statement) filed by the defendant-authority to contend that the dispute raised in the suit is not a 'commercial dispute' as defined under the Commercial Courts Act, 2015. The plaintiff company was not using the property/land, which was earmarked for the purpose and admittedly, the construction was also not made within stipulated time in terms of the lease agreement. She further submitted that even purported claim of the plaintiff company is also contrary to record. Admittedly, the land involved was not being used for trade or commerce and even the plaintiff company had not sought for any extension of time for raising constructions for establishing unit or to use for commercial purpose. It was contended that the suit was filed seeking a declaration that the allotment of the plot in favour of the defendant company by the defendant authority may be declared as null and void. Further, the plaintiff company had sought a relief of permanent injunction restraining the defendant company and defendant authority from interfering in the possession of the plaintiff company. Further defendant authority may be restrained from executing the lease deed in respect of the plot in favour of the defendant company. The land was not used for trade or commerce and therefore, a suit in the said form could not be maintained before the Commercial Court. The Commercial Court had exceeded its jurisdiction in directing the defendant authority to raise a fresh demand for recovery of pending dues/penalties, by providing ‘all benefits (waiver on penalty etc.) to the plaintiff company, which were available to other allottees’. In issuing such directions the Commercial Court granted relief numbers (iii), (iv) & (v), which were not even prayed for by the plaintiff company, therefore, the impugned judgement is nullity. She submitted that the impugned judgment and decree is untenable as the Commercial Court went further in granting to the plaintiff company the liberty to pay the amount to defendant authority within 30 days from the receipt of fresh demand notice. In doing so the Commercial Court had re-written the terms of the contract entered between the parties. The aforesaid indulgence granted to the plaintiff company was wholly illegal and unwarranted and renders the impugned judgement as nullity. She lastly submitted that the plaintiff company which was not only made default in payment but also made default in adhering the schedule for the construction and making the unit operational in terms of the lease deed, the cancellation of the lease by the defendant authority was entirely valid and legal. The plaintiff company was not at all entitled to receive such discretionary reliefs by the Commercial Court, which had patently acted not as a civil court but like a writ court exercising extra ordinary powers. The discretion was illegally exercised by the Commercial Court in favour of the plaintiff company and as such, the impugned judgement is liable to be set aside by this Court. In support of her submission, she had placed reliance on the judgement of Apex Court in Bachhaj Nahar vs. Nilima Mandal and another (2008) 17 SCC 491 [LQ/SC/2008/1958] and Mrs. Akella Lalitha vs. Sri Konda Hanumantha Rao & another. 2022 0 Supreme (SC) 630.

28. On the other hand, Sri Vishnu Gupta, learned Senior Advocate for the plaintiff company submitted that the plaintiff-company had not been served with the demand notice/show cause notice. The plaintiff company had changed its residential address after 16.05.2015 but the registered office of the plaintiff company remained at E-52, Pandav Nagar, Delhi. The defendant authority deliberately did not send the demand notice at the registered office of the plaintiff company which resulted in non-payment and subsequent cancellation of the lease deed of the plaintiff company. The plaintiff company had referred the resolution of the defendant authority dated 30.07.2019, wherein, it was resolved that all the allottees, who have not paid the lease amount should be served with notices and in case the notices are not served or received, the notices were required to be affixed at the correspondence address or to ensure the publication in newspaper via public notice. In the present case the demand notice was not sent to the registered office of the plaintiff company, which was mentioned in the lease deed and further no notice was published in the newspaper. Thereafter the plaintiff company filed the aforesaid suit seeking declaration of the cancellation notice dated 07.01.2021 as null and void and the possession of the suit property may not be taken from the plaintiff company wherein, an interim injunction was passed by the Court on 12.08.2021 restraining the defendant authority from transferring the property to any other person till the next date. In the suit proceeding both the defendants filed their written statement and taken similar pleas in their written statements by stating that the plaintiff company had not complied with the terms of the lease deed/contract between the parties and the termination of the lease deed by the defendant authority and the subsequent re-allotment of the suit property in favour of the defendant company was legal. After completing inter-se pleadings and hearing the parties at length the Commercial Court had decreed the aforesaid suit on 28.03.2022 and declared the cancellation notice dated 07.01.2021 as null and void and all consequential actions subsequent to the aforesaid cancellation notice dated 07.01.2021 have also been declared as null and void and the defendant authority has rightly been directed to issue fresh demand notice for recovery of pending dues/penalities against the plaintiff company upto 31.03.2022, within 15 days from the date of the judgment. In support of his submission, he has placed reliance on the judgment of Apex Court in Sri Saurav Jain & Anr. vs. M/s A.B.P. Design & Anr. (Civil Appeal No. 4448 of 2021 decided on 5th August 2021). He submitted that there is no infirmity or illegality in the judgement and decree and as such both the first appeals are liable to be dismissed.

29. Heard rival submissions and perused the record.

30. At the outset, it is noticed that the consideration required in the present case is as to whether the agreement/transaction between the parties, which is subject matter of suit, could be considered as a “commercial dispute” so as to enable the Commercial Court to entertain the suit.

31. 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.”

32. The Statement of Objects and Reasons of the Commercial Courts Act, 2015 read 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 create a positive image to the investor world about the independent and responsive Indian legal system.”

33. It is necessary to take note of Section 2 (1) of the Commercial Courts Act, 2015, which defines “commercial dispute” as under:-

“Sec.2(1) In this Act, unless the context otherwise requires,-

(a) “Commercial Appellate Courts” means the Commercial Appellate Courts designated under Section 3-A;

(aa) “Commercial Appellate Division” means the Commercial Appellate Division in a High Court constituted under sub-section (1) of Section 5;

(b) “Commercial Court” means the Commercial Court constituted under sub-section (1) of Section 3;

(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;

(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;

(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;

(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)].”

34. As noted above, clause (i) of Section 2 of the Commercial Courts Act, 2015 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.

35. Section 3 of the Commercial Courts Act, 2015 deals with Constitution of Commercial Courts. As per Section 3 (1) of the Commercial Courts Act, 2015 the State Government may, after consultation with the High Court, by notification, constitute such number of Commercial Courts at District level, as it may deem necessary for the purpose of exercising jurisdiction and powers conferred on those courts under this Act. Sub-section (2) of Section 3 provides that the State Government shall, after consultation with the concerned High Court specify, by notification, the local limits of the area to which the jurisdiction of a Commercial Court shall extend and may, from time to time, increase, reduce or alter such limits. Under subsection (3) the State Government may, with the concurrence of the Chief Justice of the High Court appoint one or more persons having experience in dealing with commercial disputes to be the Judge or Judges, of a Commercial Court either at the level of District Judge or a court below the level of a District Judge.

36. Section 5 of the Commercial Courts Act, 2015 deals with the Constitution of Commercial Appellate Division. Section 5 (1) 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.

(2) 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.”

37. Section 6 of Commercial Courts Act, 2015 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)”."

38. Section 7 deals with the jurisdiction of Commercial Divisions of High Courts. Section 7 of the Commercial Courts Act, 2015 reads as under:-

“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.”

39. 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.

40. Section 13 of Commercial Courts Act, 2015 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.

41. 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.

(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).

(3) Where any suit or application, including an application under the Arbitration and Conciliation Act, 1996 (26 of 1996), relating to a commercial dispute of specified value shall stand transferred to the Commercial Division or Commercial Court under sub-section (1) or sub-section (2), the provisions of this Act shall apply to those procedures that were not complete at the time of transfer.

(4) The Commercial Division or Commercial Court, as the case may be, may hold case management hearings in respect of such transferred suit or application in order to prescribe new timelines or issue such further directions as may be necessary for a speedy and efficacious disposal of such suit or application in accordance 3 [with Order XV-A] of the Code of Civil Procedure, 1908 (5 of 1908).

Provided that the proviso to sub-rule (1) of Rule 1 of Order V of the Code of Civil Procedure, 1908 (5 of 1908) shall not apply to such transferred suit or application and the court may, in its discretion, prescribe a new time period within which the written statement shall be filed.

(5) In the event that such suit or application is not transferred in the manner specified in sub-section (1), sub-section (2) or sub-section (3), the Commercial Appellate Division of the High Court may, on the application of any of the parties to the suit, withdraw such suit or application from the court before which it is pending and transfer the same for trial or disposal to the Commercial Division or Commercial Court, as the case may be, having territorial jurisdiction over such suit, and such order of transfer shall be final and binding.”

42. 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.

43. As per Section 16 of the Commercial Courts Act, 2015 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”."

44. From the perusal of the provisions extracted as above, it is noticed that the disputes arising out of lease deed of 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 executed the lease deed of the land in question on 19.01.2007, which was subsequently cancelled by the order/notice dated 07.01.2021 and presently in the aforesaid suit the declaration/cancellation of the notice dated 07.01.2021 pertaining to the land in question is sought, whether the immovable property involved could be considered as being used exclusively in trade or commerce.

45. In the case of Bachhaj Nahar vs. Nilima Mandal & Anr. (supra), Hon’ble Supreme Court dealt with the issue as to whether court can go beyond what is pleaded in pleadings for adjudication and while deciding the appeal also made a distinction on what is to be determined while adjudicating upon easement rights. The Supreme Court held that courts cannot exercise its judicial position to grant relief which is not even sought by parties in the pleadings. Relevant paras of the above judgement are reproduced hereinafter:-

“22. The observation of the High Court that when a plaintiff sets forth the facts and makes a prayer for a particular relief in the suit, he is merely suggesting what the relief should be, and that it is for the court, as a matter of law, to decide upon the relief that should be granted, is not sound. Such an observation may be appropriate with reference to a writ proceeding. It may even be appropriate in a civil suit while proposing to grant as relief, a lesser or smaller version of what is claimed. But the said observation is misconceived if it is meant to hold that a civil court may grant any relief it deems fit, ignoring the prayer.

23. It is fundamental that in a civil suit, relief to be granted can be only with reference to the prayers made in the pleadings. That apart, in civil suits, grant of relief is circumscribed by various factors like court fee, limitation, parties to the suits, as also grounds barring relief, like res judicata, estoppel, acquiescence, non-joinder of causes of action or parties etc., which require pleading and proof. Therefore, it would be hazardous to hold that in a civil suit whatever be the relief that is prayed, the court can on examination of facts grant any relief as it thinks fit. In a suit for recovery of Rs.one lakh, the court cannot grant a decree for Rs. Ten lakhs. In a suit for recovery possession of property ‘A’, court cannot grant possession of property ‘B’. In a suit praying for permanent injunction, court grant a relief of declaration or possession. The jurisdiction to grant relief in a civil suit necessarily depends on the pleadings, prayer, court fee paid, evidence let in, etc.

24. In the absence of a claim by plaintiffs based on an easementary right, the first defendant did not have an opportunity to demonstrate that the plaintiffs had no easementary right. In the absence of pleadings and an opportunity to the first defendant to deny such claim, the High Court could not have converted a suit for title into a suit for enforcement of an easementary right. The first appellate court had recorded a finding of fact that plaintiffs had not made out title. The High Court in second appeal did not disturb the said finding. As no question of law arose for consideration, the High Court ought to have dismissed the second appeal. Even if the High Court felt that a case for easement was made out, at best liberty could have been reserved to the plaintiffs to file a separate suit for easement. But the High court could not, in a second appeal, while rejecting the plea of the plaintiffs that they were owners of the suit property, grant the relief of injunction in regard to an easementary right by assuming that they had an easementary right to use the schedule property as a passage.

25. We accordingly allow these appeals and set aside the judgment and order of the High Court and restore the judgment of the first appellate court. Parties to bear their respective costs.”

46. In the case of Messrs. Trojan & Co. Ltd. vs. Rm. N.N. Nagappa Chettiar AIR 1953 SC 235 [LQ/SC/1953/35] 917, the Apex Court considered the issue as to whether relief not asked for by a party could be granted and that too without having proper pleadings. The Apex Court held as under:-

“It is well settled that the decision of a case cannot be based on grounds outside the pleadings of the parties and it is the case pleaded that has to be found. Without an amendment of the plaint, the Court was not entitled to grant the relief not asked for and no prayer was ever made to amend the plaint so as to incorporate in it an alternative case.”

47. In the case of Vasu Healthcare Private Limited vs. Gujarat Akruti TCG Biotech Limited AIR 2017 Gujarat 153 the Division Bench of Gujarat High Court held that on a plain reading of Clause 2(1) (c) of Commercial Courts 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 relevant part of the judgement is reproduced herein below:-

“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 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” 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.”

(emphasis supplied)."

48. The provisions of Section 2(i)(c)(vii) of the Commercial Court Act, 2015 has to be read as it is. The Statute lays down that only those agreement relating to immovable property which has been exclusively put to use in trade or commerce would be included in the ambit of Section 2(1) of the Commercial Courts Act, 2015. The Statute is absolutely clear, plain and unambiguous, hence, the Courts are bound to give effect to that meaning. Since the Statute is precise and unambiguous then it is imperative to expound those words in their natural and ordinary sense. The words used in the clause clearly lay down the intent of the law makers. Hence, Clause vii of Section 2(1)(c) of the C.C. Act 2015 has to be read as it is and cannot be expounded to give larger intent.

49. In an identical situation, Lord Brougham in Crawford v. Spooner (1846)4 Moo Ind App 179, pp 181 has held as under :

“to take the words as the Legislature have given them, and to take the meaning which the words given naturally imply, unless where the construction of those words is, either by the preamble or by the context of the words in question, controlled or altered.”

50. Viscount Haldane, LC in Attorney General v. Milne (1914-15) All ER Rep 1061, p 1063, has held as under :

“if the language used “has a natural meaning we cannot depart from that meaning unless, reading the statute as a whole, the context directs us to do so”."

51. Lord Atkinson in Corp of the City of Victoria v Bishop of Vancouver Island AIR 1921 PC 240, p 242 has held as under :

“In the construction of statutes, their words must be interpreted in their ordinary grammatical sense unless there be something in the context, or in the object of the statute in which they occur or in the circumstances in which they are used, to show that they were used in a special sense different from their ordinary grammatical sense.”

52. Viscount Simon, LC in Nokes v Doncaster Amalgamated Collieries Ltd. (1940) 3 All ER 549, p 553 has held that :

“The golden rule is that the words of a statute must prima facie be given their ordinary meaning.”

53. Hon’ble Apex Court in Harbhajan Singh vs. Press Council of India (2002)3 SCC 722 [LQ/SC/1995/270] has held as under :

“….Legislature does not waste its words. Ordinary, grammatical and full meaning is to be assigned to the words used while interpreting a provision to honour the rule- Legislature chooses appropriate words to express what it intends, and therefore, must be attributed with such intention as is conveyed by the words employed so long as this does not result in absurdity or anomaly or unless material - intrinsic or external - is available to permit a departure from the rule.”

54. In Chandrika Misir v. Bhaiya Lal (1973) 2 SCC 474, [LQ/SC/1973/218] Hon’ble Supreme Court was hearing a special leave petition concerning the possession of parties over the suit property which was the subject of the U.P. Zamindari Abolition and Land Reforms Act (Act 1 of 1951). While adjudicating on whether the suit was barred by limitation, Justice DG Palekar, speaking for a two Judge bench, observed that the civil court did not have jurisdiction to entertain the suit at all. Although the plea of bar on jurisdiction had not been raised in the courts below, the Apex Court held that:

“6. It is from this order that the present appeal has been filed by special leave. It is to be noticed that the suit had been filed in a civil court for possession and the Limitation Act will be the Act which will govern such a suit. It is not the case that U.P. Act 1 of 1951 authorises the filing of the suit in a civil court and prescribes a period of limitation for granting the relief of possession superseding the one prescribed by the Limitation Act. It was, therefore, perfectly arguable that if the suit is one properly entertainable by the civil court the period of limitation must be governed by the provisions of the Limitation Act and no other. In that case there would have been no alternative but to pass a decree for possession in favour of the plaintiffs. But the unfortunate part of the whole case is that the civil court had no jurisdiction at all to entertain the suit. It is true that such a contention with regard to the jurisdiction had not been raised by the defendant in the trial court but where the court is inherently lacking in jurisdiction the plea may be raised at any stage, and, it is conceded by Mr Yogeshwar Prasad, even in execution proceedings on the ground that the decree was a nullity. If one reads Section 209 and 331 of the U.P. Act 1 of 1951 together one finds that a suit like the one before us has to be filed before a Special Court created under the Act within a period of limitation specially prescribed under the rules made under the Act and the jurisdiction of the ordinary civil court is absolutely barred.”

55. 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 [LQ/SC/2000/1163] the Apex Court 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)."

56. In the case of Shri Saurav Jain & Anr v. M/s A. B. P. Design & Anr (supra) the Apex Court has held that though the appellant did not assail the finding of the trial Court on the issue of jurisdiction before the Allahabad High Court under Order XLI Rule 22 CPC either by filing a memorandum of cross-objection or otherwise, he was not precluded from raising the argument before the Supreme Court. The Supreme Court, in view of its plenary jurisdiction under Article 136 of the Constitution read with its power to do complete justice under Article 142, can entertain new grounds raised for the first time, if it involves a question of law which does not require adducing additional evidence, specifically one concerning jurisdiction of the court which goes to the root of the matter. Relevant paragraph-39 of the judgement reads as under:-

“39. We have come to the conclusion that the suit instituted by the first respondent had to be dismissed. The judgment of the Trial Judge dismissing the suit was correct, but for the following reasons: (i) The purported transfer of the suit land by Zahid Hussain to the first respondent was before the Repeal Act was enacted. The dual conditions stipulated under Section 5(3) of ULCRA were not fulfilled before the transfer was made since the statement under Section 6 had not been submitted and the Competent Authority had not issued a notification under Section 10(1) of the ULCRA (which was in operation at the time). Therefore, even if the Zahid Hussain had the title to the suit land, the transfer to the first respondent was null and void under section 5(3) of ULCRA; (ii) When Zahid Hussain had filed a declaration seeking permission for transfer of the suit land, the permission under Section 27 of ULCRA was not granted since there was a pending suit concerning the said land. He then filed another application seeking permission for transfer of land admeasuring 1295 sq. mt of his ‘retainable’ 2000 sq. mt. of land. The permission that was granted under Section 27 of ULCRA by the Office of the Competent Authority on 5 May 1993 was for the transfer of lands from his ‘retainable’ property and not the suit land; (iii) The plaintiff- first respondent has artfully drafted the plaint to challenge the validity of the auction and sought an injunction and declaration, when the substantive cause of action of the suit arises out of the land ceiling proceedings; (iv) The ULCRA impliedly excludes the jurisdiction of the civil court on matters arising out of the ceiling proceedings; and (v) Though the appellant did not assail the finding of the Trial Court on the issue of jurisdiction before the High Court under Order XLI Rule 22 CPC either by filing a memorandum of cross-objection or otherwise, he is not precluded from raising the argument before this Court. This Court in view of its plenary jurisdiction under Article 136 of the Constitution read with its power to do complete justice under Article 142, can entertain new grounds raised for the first time if it involves a question of law which does not require adducing additional evidence, specifically one concerning jurisdiction of the court which goes to the root of the matter.”

57. In Ambalal Sarabhai Enterprises Ltd (supra) Hon’ble Supreme Court held that the dispute relating to immovable property per se may not be a commercial dispute but it becomes a commercial dispute if it falls under sub-section (vii) of Section 2 (1) (c) of the Commercial Court Act, 2015. It was further held that the words “used exclusively in trade and 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.”. The relevant part of the judgement is reproduced herein below:-

“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 15 likely to be used in relation to trade and commerce, the same cannot be the ground to attract the jurisdiction of the Commercial Court.

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 16 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 17 to 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”

58. Bombay High Court in M/S Glasswood Realty Pvt Ltd vs Chadravilas Kailashkumar (Writ Petition No.8393 of 2021 decided on 06.12.2021) has held that the dispute arising out of transactions between the persons who are classified in Clause 1 of Section 2(c) only qualify to be covered by the definition of ‘commercial dispute’. The Court further held that it is necessary to adopt a careful approach in scrutinizing whether the dispute would fall within the purview of ‘commercial dispute’, and if not, it would fall in the category of ordinary civil dispute and such dispute cannot be permitted to be tried by Commercial Court but has to be tried as a normal suit under the prescribed provisions of CPC.

59. The Delhi High Court in Kailash Devi Khanna vs. DD Global Capital Ltd. 2019 SCC Online Del 9954 held that all suits for recovery of monies cannot brought under Section 2(1)(c)(i) of the Act where the suit is not based on any transaction relating to mercantile documents.

60. The Madras High Court in R. Kumar vs. T.A.S. Jawahar Ayya (C.S. No.431 of 2019) was of the view that since the plaintiffs did not transact in the capacity of financiers, the dispute was not a "commercial dispute" and that an ordinary transaction of the four classes of persons mentioned in 2(1)(c)(i) arising out of mercantile documents alone would fall within the definition of a commercial dispute.

61. 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 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 boost the economic growth of the country.

62. Though such rival contentions were put forth by the counsel on either side, the said submissions 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 pleadings set up in the suit itself before the Commercial Court. The pleadings made in the averments in the plaint would at the outset be relevant to confer jurisdiction to the competent Commercial Court. Therefore, before adverting to the merits and other aspects, it would be necessary to carefully examine the plaint, written submission and other pleadings set up by the parties before the Commercial Court. The defendant company has referred to the nature of the transaction between the appellant authority and plaintiff company. As the details regarding the pleadings and plaint were already given in detail as above, this is admitted situation that in terms of the lease agreement neither the plaintiff company deposited the amount as per scheduled nor raised any construction within stipulated time. Even it has not moved any application for extension or enlargement of time for raising the constructions even before filing of the suit.

63. The Commercial Court is exclusively constituted to try the commercial disputes, which has jurisdiction to try the same. In that background, a perusal of the prayer made in the plaint would essentially indicate that the suit was filed seeking declaration/cancellation of notice dated 07.01.2021 issued by the defendant authority by which the lease deed dated 19.01.2007 executed in favour of the plaintiff company was cancelled by the defendant-authority. Even if the immovable property under the lease deed was the subject matter, it is necessary to plead and substantiate that the same was being used in trade or commerce due to which the jurisdiction of Commercial Court was 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.

64. The defendant company had filed written statement in the aforesaid suit, which was appended with the paper book, stating inter alia certain facts and also that a decree of declaration and dislodge or extension is discretionary relief to which the plaintiff company was not entitled for the reason that the defendant company had also filed the balance sheet of the plaintiff company for the year 2015-19 from the ‘Ministry of Corporate Affairs’ and perusal thereof clearly shows that the plaintiff company concealed the fact that, it was inactive shell company, which had no business operations, no turnover and nil income. The amount of Rs.1,00,78,716/- paid by the plaintiff company to the defendant authority in respect of the plot was reflected in its balance sheets as long term unsecured loans taken by the plaintiff company, which was on record and therefore, on the basis of record it was also pressed before us that at the relevant time the plaintiff company had no money whatsoever, to either make the balance payment to the defendant authority or to make constructions on the said plot as required under the terms of the lease deed. Therefore, it was also pleaded in the written statement by the defendant company that the allotment of an institutional plot at special rates was made to business entities by the defendant authority to promote business and employment in the Noida region. But in fact the plaintiff company is a company with no operations, nil turnover and no business record whatsoever and neither it was legally nor morally entitled to benefit from such allotment. It was also pleaded in the written statement filed by the defendant company that the plaintiff company was only incorporated on 19.12.2005 shortly before process of bidding of the plot in question just to procure lease rights of the said plot at the discounted allotment rates so as to later sell it at premium in the market, and to make a quick buck, as a real estate deal.

65. It was also pressed that even though the appellant company filed detailed written statement, which remained unrebutted by the plaintiff company, but the Commercial Court did not take into consideration and rather brushed aside the said objection with the summary observations that the defendant company had no substantial right against the plaintiff company as there is no privity of contract between the plaintiff company and the defendant company. Before the Commercial Court it was conveniently pressed by the plaintiff company as there was no breach of the lease deed. The only case set up by the plaintiff company to challenge the cancellation of the lease on the ground that the notices dated 13.12.2009, 03.02.2020, 17.06.2020 and 14.07.2020 sent by the defendant authority prior to cancellation, were not sent to the registered address of the plaintiff company but in fact the same were sent to E292A, Sector 22, Noida, which was the address of the Director of the company at which the plaintiff company was no longer available and further no notice was affixed at the correspondence address or to ensure the public notice.

66. In this backdrop, we have also examined the lease deed, which does not contain any provision for issuance of notice before cancellation in case of breach by lessee, contrarily as per record it is admitted fact that the show cause notices were sent to the plaintiff company by the defendant authority as early as in 2013 and 2014, which is duly acknowledged/claimed in para-11 of the plaint that its address changed only in the year 2015. The plaintiff company had not pleaded any case in the plaint regarding any steps or measures in response to the aforesaid notices. Heavy reliance has also been placed by the Commercial Court on the provisions of Section 43 of the Act, 1973, which stipulates that any notice required to be sent to a company under the provision of the Act may be sent at its registered office or its principal office or its place of business. It is also reflected from the record that the plaintiff company has consistently used the said address in all its documentation including the lease deed, which shows that the plaintiff company projected the said address as its place of business. In fact the same address has been used as the company’s address in the earlier writ petition (Writ C No.13225/2021) filed before this Court in 2021. Hence, the contention, that the address was changed in 2015, is also not accepted.

67. From the statements made in the plaint it is evident that the plaintiff company approached the appellant authority for grant of lease in respect of an immovable property for the purpose of trade and commerce. The lease deed of the plot in question was executed on 19.01.2007 and pursuant to the lease deed the plaintiff company deposited 30% of the amount. Admittedly, the possession of the land was handed over to the plaintiff company on 01.02.2007. In terms of Clause 13 (A) of the lease deed the plaintiff company had to complete the construction within five years from the actual date of possession, which could be extended further two years. Neither it deposited the required money in terms of the agreement nor moved any application for enlargement of time for construction. Consequently, the lease deed was cancelled and the property was re-allotted in favour of the defendant company. The aforesaid suit was filed seeking declaration/cancellation of notice dated 07.01.2021 whereby the lease deed dated 19.01.2007 executed in favour of the plaintiff company was cancelled by the defendant authority. The instant suit has been filed for adjudication of a dispute arising out of the lease deed relating to immovable property.

68. There is nothing on record to show that at the time when the lease deed was executed in 2007, the property was being exclusively used in trade and commerce so as to bring dispute within the ambit of subclause (vii) of Section 2(1)(c) of the Commercial Court Act, 2015. 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.

69. The question arises in aforementioned facts as to whether the dispute involved in the present case can be considered as commercial dispute, which would be within the ambit of Commercial Court Act, 2015. On plain reading of Section 2 (1) (c) of the Commercial Court Act, 2015 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 “likely to be used” or “to be used” would have been used. A matter will fall under the jurisdiction of the Commercial Court or the Commercial Division of the High Court on the following factors namely (i) it shall be a commercial dispute within the meaning of Section 2(1)(c) of the Commercial Court Act, 2015; and (ii) such commercial disputes are of a specified value as per Section 2 (i) of the Commercial Court Act, 2015..

70. From the above it has been established that a dispute relating to immovable property per se may not be a commercial dispute but the same 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”.

71. On a perusal of the Statement of Objects and Reasons of the Commercial Court Act, 2015 and the various amendments to Civil Procedure Code and insertion of new rules to the Code applicable to suits of commercial disputes it is evident 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 Commercial Court Act, 2015 are interpreted in a narrow sense and not hampered by the usual procedural delays plaguing our traditional legal system.

72. Learned Commercial Court totally misinterpreted the definition of commercial dispute and failed to appreciate that there is a difference between the “Commercial Dispute and Commercial Relation”. As such, the finding of learned Commercial Court that there is a commercial dispute between the parties suffers from infirmity.

73. In view of above, we are of the considered opinion that there is no commercial dispute. The Commercial Court had no jurisdiction to decide the present dispute between the parties. Once we have decided commercial Court has no jurisdiction in view of Commercial Court Act, 2015, the other issues are only academic in nature which are not required to be considered or to be answered by the Court.

74. For the aforesaid reasons we allow both appeals and set aside the judgment and decree dated 28.3.2022 passed by the Presiding Officer, Commercial Court, Gautam Budh Nagar in Suit (Comm) No.167 of 2021.