Isabella Mariam

The High Court of Kerala Full Bench of Justice Sathish Ninan, Justice C.S. Dias, and Justice C.S. Sudha ruled on 24 September 2025 that, under Section 12(1)(c) of the Commercial Courts Act, 2015, the market value of the property—not the valuation applied for court fees under the Kerala Court Fees and Suits Valuation Act, 1959—must govern the determination of the “specified value” in commercial disputes. Resolving a reference prompted by conflicting precedents, the Court clarified that valuation for jurisdiction under the Commercial Courts Act is based on the intrinsic value of the property involved, rather than the relief-oriented assessment used for court-fee purposes.

The case arose on a reference made to resolve the question of whether valuation for the purpose of payment of court fees under the Kerala Court Fees and Suits Valuation Act, 1959, could be treated as the basis for determining specified value under Section 12(1)(c) of the Commercial Courts Act, 2015. The issue stemmed from conflicting interpretations in earlier judgements, including Surendran v. Kunhimoosa (2021 SCC OnLine Ker 9808) and Hindusthan Petroleum Corporation Mumbai & Anr. v. Muhammed Illiyas & Ors. (2022 (6) KHC 68), which had concluded that valuation for court fees would also serve for determining jurisdictional specified value under the Commercial Courts Act.

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The petitioners argued that valuation under the Court Fees Act should determine specified value for jurisdiction, relying on precedents from the Kerala High Court and decisions from other jurisdictions, such as Soni Dave v. M/s Trans Asian Industries Expositions Pvt. Ltd. (AIR 2016 Del 186) and Fine Footwear Pvt. Ltd. v. Skechers USA Inc. (2019 SCC OnLine Kar 1024). It was contended that adopting different standards would cause incongruity between the Court Fees Act and the Commercial Courts Act.

The respondents, however, pointed to the language of Section 12 of the Commercial Courts Act, which stipulates determination of specified value based on the market value of the subject matter of the dispute—whether money, movable, immovable, or intangible rights. They argued that valuation for court fees and valuation for jurisdiction are distinct exercises and that the statute expressly mandates market value in cases concerning immovable property.

The dispute specifically turned on the interpretation of “subject matter” and “specified value.” Earlier decisions had construed subject matter not as the property itself but the right or relief claimed.

The Bench noted that the Commercial Courts Act envisages speedy adjudication of commercial disputes, mandating that such suits be heard by courts of specified jurisdiction where the dispute exceeds a particular threshold value. Section 2(1)(i) defines “specified value” as the value of the subject matter in accordance with Section 12, which explicitly provides the method of determination.

The Court recorded: “Determination of the ‘specified value’ of the subject matter of the suit is of significance. This is so since, as noticed, even if the dispute satisfies the definition of a commercial dispute under the CC Act, unless the value of the subject matter of the commercial dispute is of ‘specified value’, the suit will not fall within the jurisdiction of the commercial court.”

The Court further observed: “If the relief sought relates to immovable property or to a right therein, the market value of the property will determine the specified value of the subject matter of the commercial dispute. Such suits would include even a suit for injunction, around which the main argument centers. There is no warrant to exclude such relief from the scope of Section 12(1)(c).”

Referring to the reliance placed on Surendran v. Kunhimoosa and Hindusthan Petroleum Corporation’s case, the Court recorded: “In the judgments referred to above, it has been first concluded that the ‘subject matter’ of the suit is not the property, but it is the value of the right which the plaintiff seeks to enforce. A Full Bench of this Court in Victoria v. Yesuraj Kumar elaborately discussed on the meaning of the term ‘subject matter’.” The Court then reiterated that subject matter refers to the right, relief, or cause of action, but for purposes of valuation under the Commercial Courts Act, the statute expressly directs reliance on market value.

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The Bench rejected the contention that harmonisation with the Court Fees Act was necessary to avoid inconsistency, stating: “There is no inconsistency or incongruity in referring to CC Act for the purpose of valuation for jurisdiction and to the Court Fees Act for valuation for payment of court fee. The above is only in accordance with the express provision under Section 53(1) of the Court Fees Act.”

The Court concluded its reasoning by stating: “For the reasons above, we are unable to concur with the view adopted in Surendran’s case and Hindusthan Petroleum Corporation’s case that, valuation under the Court Fees Act for the purpose of court fee determines the

The Bench directed: “Accordingly, the reference is answered holding that, to determine the specified value under Section 12(1)(c) of the CC Act, the valuation for the purpose of court fees under the Court Fees Act is not determinative, and that the valuation for ascertainment of the specified value is to be on the market value of the immovable property.”

Advocates Representing the Parties:
For the Petitioners: Sri. B. Krishnan, Advocate; Sri. P.B. Subramanyan, Advocate

Case Number: ICR (CRP) No.11 of 2025, CRP No.133 of 2024 & OP(C) No.753 of 2024
Bench: Justice Sathish Ninan, Justice C.S. Dias, Justice C.S. Sudha