Madras High Court Says Parties Can't Seek Leave To File Additional Written Statements In Commercial Suits

The Madras High Court has held that a provision of the Code of Civil Procedure allowing parties to seek the court's permission to file an additional written statement after their original defence does not apply to commercial suits

The court observed that entertaining such applications at the instance of parties would defeat the Commercial Courts Act's objective of ensuring speedy disposal of commercial disputes.

“The object of the Commercial Courts Act, which is the speedy disposal of Commercial suits would have been defeated if the Commercial Court had allowed the application filed by the petitioner under Order VIII Rule 9 CPC.” it held

A coram of Justice Abdul Quddhose, however, clarified that a commercial court may, in exceptional circumstances, direct a defendant to file an additional written statement by exercising its inherent powers under Section 151 CPC, without any leave application.

“….the Commercial Court may suo-motu, in the interest of justice, require the defendant to file additional written statement if the need arises to unearth the truth and may also direct the defendant to file additional written statement without a leave application under certain exigencies by exercising its inherent powers u/s 151 CPC” it clarified

The court was hearing a petition filed by Sri Gokulam Hospital Private Limited, challenging an order of the Commercial Court rejecting its application under Order VIII Rule 9 CPC seeking leave to file an additional written statement in a commercial suit instituted by Canadian Crystalline Water India Limited.

The hospital contended that, after filing its written statement, it discovered that certain purchase orders relied upon by Canadian Crystalline bore forged signatures. It therefore sought to introduce a specific plea of forgery through an additional written statement.

The Commercial Court rejected the application, observing that the disputed documents had been filed along with the plaint and that permitting an additional written statement at that stage would delay the disposal of the suit.

Rejecting the plea, the Court observed that the Commercial Courts Act is intended to ensure the expeditious disposal of commercial disputes and provides a comprehensive framework for inspection and production of documents to minimise procedural delays.

The Court emphasised that since the Act already provides adequate safeguards for parties to obtain documents not in their possession, the petitioner's plea for filing an additional written statement under the CPC was untenable.

“When strict timelines have been fixed under the Commercial Courts Act for filing written statement and when adequate safeguards have been provided under the Commercial Courts Act for a party to obtain documents from the opposite party or from the Court, the question of granting leave by the Commercial Court to file additional written statement does not arise at all, as it will only defeat the object of the Commercial Courts Act, which is, speedy disposal of Commercial disputes.” it stated

The Court further held that permitting such applications would enable defendants to delay commercial suits, thereby defeating the very object of the Commercial Courts Act.

It also observed that the Act provides special safeguards for production of documents that are unavailable in ordinary civil suits. Granting leave to file an additional written statement, it held, would effectively allow a party to bypass the mandatory 120-day time limit prescribed under the Commercial Courts Act for filing a written statement.

Accordingly, the bench dismissed the petition and clarified that the petitioner would remain at liberty to raise the plea of forgery during the cross-examination of the plaintiff's witnesses and at the stage of final arguments before the Commercial Court.

For Petitioner: Advocate P Veena Suresh

For Respondent: Advocate Anupam Raghuraman