Before the Act, commercial disputes were decided like ordinary civil suits, often taking several years to conclude.

The objectives of the Act are to:

• Speed up resolution of commercial disputes.
• Reduce judicial delays.
• Encourage business confidence.
• Improve enforceability of contracts.
• Promote foreign investment.
• Introduce international best practices in commercial litigation.

Commercial disputes may be heard by:

• Commercial Courts at the District Judge level.
• Commercial Divisions of High Courts having ordinary original civil jurisdiction.
• Commercial Appellate Courts.
• Commercial Appellate Divisions of High Courts.

The appropriate forum depends on:

• territorial jurisdiction,
• pecuniary jurisdiction, and
• specified value of the dispute.

Jurisdiction depends on three factors:

1. Territorial Jurisdiction

The dispute must arise within the territorial limits of the court.

Examples:

• Place where contract was executed
• Place where goods were delivered
• Place where payment was due
• Place where defendant carries on business

1. Pecuniary Jurisdiction

The value of the claim should satisfy the pecuniary limits prescribed by the respective High Court or State Government.

1. Commercial Nature

The dispute must qualify as a "commercial dispute" under Section 2(1)(c) of the Act.

A commercial dispute refers to disputes arising from commercial transactions.

These include disputes relating to:

• Merchants
• Traders
• Bankers
• Financiers
• Business entities
• Commercial documents
• Trade and commerce

The Act specifically includes disputes involving:

Contracts

• Supply agreements
• Purchase agreements
• Service agreements
• Consultancy contracts
• Franchise agreements
• Distribution agreements

Infrastructure

• Construction contracts
• EPC Contracts
• Turnkey projects

Banking

• Loan recovery
• Credit facilities
• Guarantees
• Letters of Credit

Intellectual Property

• Trademark disputes
• Copyright
• Patent disputes
• Passing off
• Licensing agreements

Corporate

• Shareholders Agreements
• Joint Venture Agreements
• Share Purchase Agreements

Partnership

• Partnership disputes
• LLP disputes

Insurance

Commercial insurance claims

Maritime

• Shipping
• Charter party disputes
• Carriage of goods

Aviation

Commercial aviation disputes

Real Estate

Commercial property transactions

Commercial leases

Development agreements

Technology

Software licensing

IT contracts

Data licensing

Technology transfer

Agency

Agency agreements

Commission agreements

International Trade

Import-export contracts

Cross-border commercial transactions

Government Contracts

Commercial contracts entered into by Government entities.

Specified Value means the minimum monetary value of a commercial dispute for the Act to apply.

Currently, the minimum specified value is:

₹3,00,000

This includes:

• principal claim
• interest claimed (where applicable)
• value of movable or immovable property involved

market value where relief is non-monetary.

The value depends upon the relief sought.

Examples:

Money recovery suit:

Claim Amount + Interest

Property dispute:

Market value

Injunction:

Market value of the right sought to be protected

Intellectual Property:

Market value of the intellectual property rights involved

Yes.

Where no urgent interim relief is sought, Section 12A mandates:

Pre-Institution Mediation (PIM)

before filing the suit.

Failure to undergo mediation may result in rejection of the plaint.

If the plaintiff seeks:

• Temporary injunction
• Status quo order
• Appointment of Receiver
• Anton Piller orders
• Mareva injunction
• Other urgent interim reliefs

the suit may be filed directly.

Normally:

Three months

which can be extended by:

Two additional months

with consent of parties.

Yes.

The settlement has the same status as an arbitral award on agreed terms under the Arbitration and Conciliation Act.

It is executable like a decree.

Commercial litigation follows stricter timelines.

For example:

• Written Statement generally within 30 days and, in any event, not beyond 120 days from service of summons, after which the defendant forfeits the right to file it.
• Mandatory disclosure of documents.
• Case Management Hearings.
• Costs follow the event.
• Strict adjournment policy.

Continuous hearings.

Generally, parties must disclose all relevant documents at the beginning.

Late filing is permitted only with sufficient cause and leave of the Court.

The Court actively manages the case by:

• fixing timelines,
• framing issues,
• scheduling evidence,
• deciding witness examination,
• controlling adjournments,
• fixing trial dates.

Generally, yes.

Unlike ordinary civil suits, Commercial Courts frequently award:

• advocate fees,
• litigation expenses,
• court fees,
• witness expenses,
• other reasonable costs.

This discourages frivolous litigation.

Yes.

The Act prescribes strict procedural timelines intended to reduce delays.

Although timelines may vary depending on complexity and court workload, commercial matters are generally disposed of significantly faster than ordinary civil suits.

Yes.

Appeals lie before:

Commercial Appellate Court

or

Commercial Appellate Division of the High Court,

depending on the forum.

However, appeals are restricted to orders specifically made appealable by law.