The Supreme Court ruled that Sections 3 and 10 of Commercial Courts Act, 2015 shall prevail and all applications or appeals arising out of the arbitration other than international commercial arbitration shall be disposed of by Commercial Courts.
Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the High Court of Orissa at Cuttack in respective writ petitions, by which, the Division Bench of the High Court has dismissed the writ petitions in which the appellants original writ petitioners challenged a notification issued by the State of Odisha, Law Department in establishing the Court of the Civil Judge (Senior Division) as Commercial Courts for the purposes of exercising jurisdiction and powers under the Commercial Courts Act, 2015, the original writ petitioners have preferred the appeals.
Advocate Uttara Babbar, appearing for the appellants, submitted that there is a conflict between Section 3 of the Act, 2015 and Section 2(1)(e) of the Arbitration Act, 1996.
She contended that Section 2(1)(e) of the Arbitration Act, 1996 provides that the Principal Civil Court of original jurisdiction in a district shall be the “Court” in the case of an arbitration other than international commercial arbitration.
Advocate Gaurav Aggarwal, Amicus Curiae, submitted that the Commercial Courts Act and the establishment of Commercial Courts are with a view to facilitate early disposal of the high value disputes/commercial disputes.
He contended that with a view to achieving the object of speedy disposal of the commercial disputes, the legislature has enacted the Commercial Courts Act, 2015.
The division bench of Justice M.R. Shah and Justice Krishna Murari stated that a commercial Court can be set up under Section 3 of the Act, 2015 and a commercial appellate Court can be set up under Section 3A of the Act, 2015.
It was observed that the Objects and Reasons of Commercial Courts Act, 2015 is to provide for speedy disposal of the commercial disputes which includes the arbitration proceedings.
The bench added that to achieve the said objectives, the legislature in its wisdom has specifically conferred the jurisdiction in respect of arbitration matters as per Section 10 of the Act, 2015.
It was noted that the Act, 2015 is the Act later in time and therefore when the Act, 2015 has been enacted, more particularly Sections 3 & 10, there was already a provision contained in Section 2(1)(e) of the Act, 1996.
It was further noted that even as per Section 15 of the Act, 2015, all suits and applications including applications under the Act, 1996, relating to a commercial dispute of specified value shall have to be transferred to the Commercial Court. Even as per Section 21 of the Act, 2015, Act, 2015 shall have an overriding effect.
The court held that under the circumstances, notification issued by the State of Odisha issued in consultation with the High Court of Orissa to confer jurisdiction upon the court of Civil Judge (Senior Division) designated as Commercial Court to decide the applications or appeals arising out of arbitration under the provisions of Act, 1996 cannot be said to be illegal and bad in law.
The bench dismissed the appeals.
Case title: Jaycee Housing Pvt. Ltd. & Ors. v/s Registrar (General), Orissa High Court, Cuttack & Ors.
Citation: Civil appeal no. 6876 of 2022