Plaint Cannot Be Read So As To Bypass Pre-Institution Mediation Under Commercial Courts Act: Calcutta High Court

The Calcutta High Court has held that a plaint cannot be framed so as to bypass the mandatory pre-institution mediation requirement under Section 12A of the Commercial Courts Act.

The court made the observation while allowing an appeal in a case where a suit relating to a commercial dispute had been filed in the non-commercial division and while considering rejection of the plaint under Order 7 Rule 11 of the Code of Civil Procedure.

“Section 12A of the Act of 2015 has mandated preinstitution mediation. Mandatory pre-institution mediation, stipulated under Section 12A of the Act of 2015, comes to the benefit of all the parties to the suit. None of the parties to the suit should be allowed to overcome such provisions of the law by a claim which cannot be sustained on the face of pleadings of the plaint. In a scenario under Order 7 Rule 11 of the Code of Civil Procedure, 1908 where, statements made in the plaint are to be taken into consideration. Plaint, even in the case of Order 7 Rule 11 of the Code of Civil Procedure, 1908 cannot be read so as to defeat the valuable right." the court observed.

A Division Bench of Justices Debangsu Basak and Md. Shabbar Rashidi allowed an appeal filed by Auto Fuel & Services against an order dated September 25, 2025, by which a single judge had refused to reject the plaint in a suit for eviction and mesne profits filed by the purchaser of the property against Amalgamated Fuels Limited and Auto Fuel & Services.

The dispute concerns an immovable property currently used as a petrol pump. The property had originally been leased through a registered deed dated December 5, 1952 in favour of Burmah Shell Oil Storage and Distribution Company, whose interests were later taken over by Bharat Petroleum Corporation after nationalization under the Burmah Shell (Acquisition of Undertakings in India) Act.

The property was subsequently conveyed to the Auto Fuels by a deed dated February 19, 1998.

Auto Fuels filed a suit seeking eviction of the defendants as alleged trespassers after issuing a notice on July 28, 2021. However, the defendants argued that the dispute arose from a lease relating to property presently used for commercial purposes and therefore qualified as a “commercial dispute” under Section 2(1)(c)(vii) of the Commercial Courts Act.

The division bench observed that three conditions are required for a dispute to qualify as a commercial dispute, it must arise out of an agreement, relate to immovable property, and the property must presently be used exclusively for trade or commerce. Based on the plaint itself, the court noted that these ingredients were satisfied.

Since the suit was filed in the non-commercial division despite the dispute being commercial, the court rejected the plaint while granting liberty to the plaintiff to file the suit before the appropriate forum.

For Appellant: Senior Advocate Anirban Ray with Advocates Debraj Shaw, Anamika Pandey

For Respondent: Senior Advocate Abhrajit Mitra with Advocates Sarvapriya Mukherjee, Iram Hassan, Samriddha Sen, Himangshu Bhawsinghka