In a recent legal ruling by the Delhi High Court, the application for transfer of litigation in the case of Prayag Polytech Pvt Ltd. v. Raj Kumar Tulsian has been dismissed. The court maintained the decision of Commercial Court-04, emphasizing the importance of swift prosecution in commercial matters. Find out more about the judgment and its significance in commercial litigation.
Facts
- Defendant 1 did not take any steps to cure the defect within the allowed 90-day period.
- No efforts were made by Defendant 1 to rectify the issue as the maximum condonable period expired.
- The learned Commercial Court-04 held that the written statement could not be taken on record.
Arguments
- Mr. Wadhwa contends that the Commercial Court-04’s view contradicts the law established in Prayag Polytech Pvt Ltd. v. Raj Kumar Tulsian.
- Mr. Wadhwa argues that the Commercial Court-04 made an error in not accepting certain documents filed in 2021 with the written statement.
- According to Mr. Wadhwa, the Commercial Court-04 was wrong in insisting on serving a copy of the Section 340 CrPC application on the respondent, despite Jasbir Singh being cited.
- He asserts that the requirement of serving the application on the non-applicant is not mandatory, citing the Supreme Court’s decision in State of Punjab Vs. Jasbir Singh.
- Mr. Wadhwa highlights that the judgment in State of Punjab v. Jasbir Singh eliminates the need for advance notice on a Section 340 CrPC application.
- The documents were actually filed under an index dated 17 August 2021, not 18 August 2021 as claimed by ARG_RESPONDENT.
Analysis
- The High Court granted relief to Jasbir Singh regarding the FIR on the ground of non-compliance with mandatory requirements of Section 340 CrPC.
- The issue before the Supreme Court was whether a preliminary inquiry was required before filing a complaint under Section 340 CrPC.
- The decision in Jasbir Singh did not proscribe the Commercial Court-04 from directing a copy of the Section 340 CrPC application.
- The transfer of a matter may have injurious consequences even if seems innocuous.
- The view taken by the Commercial Court-04 cannot be deemed as perverse, but based on a proper construction of the Commercial Courts Act.
- Entertaining an application under Section 340 CrPC initiates criminal law proceedings against the accused.
- It is crucial to prosecute commercial matters swiftly, as repeatedly emphasized by the Supreme Court and Division Benches.
- Delay in commercial proceedings demoralizes the judge concerned and must be avoided.
- The Supreme Court in Sudhir Kumar emphasized strict construction of Commercial Courts Act proceedings without relaxation.
- Applications for transfer of litigation outside the court hearing it are often considered an abuse of process.
- 1.1
- The Supreme Court framed the questions arising before it for consideration related to Section 340 of the Code of Criminal Procedure, 1973 and the need for a preliminary inquiry before a complaint is made under Section 195 of the Code by a Court.
- Section 195(2) of the CrPC specifies the conditions under which a complaint can be made by a public servant.
- Section 195(1) pertains to the power of a court to take cognizance of specific offenses and the requirement for a written complaint by the concerned public servant.
- The distinction between the making of a complaint and the court taking cognizance of the complaint is outlined.
- The Supreme Court identified the main issue as whether a preliminary inquiry and an opportunity of hearing to the potential accused were necessary before a complaint was made under Section 195.
- In commercial litigation, a litigant cannot choose to argue a matter before a court just because they find it more agreeable
- Attempting to avoid the court by arguing the matter elsewhere is not an acceptable practice
- This behavior must be strongly discouraged
Decision
- The decision for transfer of proceedings from Commercial Court-04 is being examined by a coordinate Bench
- In commercial litigation, litigants tend to use various methods to prejudice the proper continuance of proceedings
- No case for transfer of CS (Comm) 1432/2020 is established
- The petition for transfer is dismissed with costs of ₹50,000/- to be paid to the Delhi High Court Legal Services Committee within a week
- Defendant No.1 is directed to deposit a cost of Rs.10,000/- with DLSA within a week for causing unnecessary delay in the case
Case Title: SANJAY GOEL Vs. BKR CAPITAL PVT. LTD. (2024:DHC:3773)
Case Number: TR.P.(C.)-76/2024
