Kiran Raj

The Supreme Court Division Bench of Justice Vikram Nath and Justice Sandeep Mehta set aside the Bombay High Court’s decision, which had held that the appellant–plaintiff’s appeal under Section 13(1A) of the Commercial Courts Act, challenging the order allowing the respondent–defendant’s application for rejection of the plaint, was not maintainable. Clarifying the procedural framework under the Commercial Courts Act, 2015, the Court held that an order allowing an application for rejection of a plaint constitutes a decree and is therefore appealable under Section 13(1A) of the Act. It further clarified that an order dismissing such an application does not attract the same provision and may only be challenged through a revision or petition under Article 227 of the Constitution.

The appellants, MITC Rolling Mills Private Limited and another, filed Commercial Suit No. 06 of 2021 before the District Judge, Nashik, seeking recovery of Rs.1,64,60,528 towards principal and Rs.87,78,300 towards interest, aggregating to Rs.2,52,38,828, alleging that M/s Renuka Realtors and others failed to make payment for the supply of TMT/Fe-500 material.

Also Read: Can State Appeal in CBI-Prosecuted Cases When Probe Began with State Police? Supreme Court Leaves Question Open, Allows CBI Plea in Raipur Murder Case

The respondents filed an application under Order VII Rule 11 of the Code of Civil Procedure, 1908, seeking rejection of the plaint on the ground that the appellants had not undertaken the mandatory Pre-Institution Mediation and Settlement as required under Section 12A of the Commercial Courts Act, 2015. The trial court accepted the application and rejected the plaint by order dated 10 November 2022.

Aggrieved, the appellants preferred Commercial First Appeal No. 8 of 2023 before the High Court of Judicature at Bombay under Section 13(1A) of the Commercial Courts Act, 2015, contending that rejection of a plaint constitutes a decree under Section 2(2) of the Code of Civil Procedure. The High Court dismissed the appeal on 17 February 2025, holding it to be non-maintainable on the ground that such an order does not fall within the ambit of Order XLIII of the Code and hence is not appealable under Section 13(1A) of the Commercial Courts Act.

The appellants approached the Supreme Court challenging the High Court’s view. They submitted that rejection of a plaint under Order VII Rule 11 CPC conclusively determines the rights of the parties and thus qualifies as a decree. The respondents relied upon the decision in Bank of India v. Maruti Civil Works (2023 SCC OnLine Bom 2667), affirmed by this Court on 15 March 2024, to support the High Court’s reasoning that the appeal was not maintainable.

The Court stated: “There cannot be any two views on the aspect that an order rejecting the plaint under Order VII Rule 11 CPC decides the lis finally and would tantamount to a decree within the meaning of Section 2(2) CPC.”

The Court recorded: “In the present case, the plaint was rejected under Order 7 Rule 11 CPC. Such an order amounts to a decree under Section 2(2), and there is a right of appeal open to the plaintiff.”

The Court observed: “A decree passed by a Commercial Court at the level of a District Judge exercising original civil jurisdiction or, as the case may be, the Commercial Division of a High Court would ordinarily be appealable before the High Court under Section 13(1A) of the CCA, 2015, read with the applicable provisions of the CPC.”

The Court stated: “Section 13(1A) of the CCA, 2015, is in two distinct parts. The main provision contemplates appeals against ‘judgments’ and ‘orders’ of the Commercial Court to the Commercial Appellate Division of the High Court. The proviso, operating as an exception, must be construed harmoniously with the main provision and not in derogation thereof.”

The Court recorded: “Where the language of the main provision is plain and unambiguous, the proviso cannot be invoked to curtail or whittle down the scope of the principal enactment, save and except where such exclusion is clearly and expressly contemplated.”

The Court observed: “The proviso merely restricts appeals against interlocutory orders to those specifically enumerated under Order XLIII CPC and Section 37 of the Arbitration and Conciliation Act, 1996. Consequently, only such interlocutory orders as are expressly specified therein would be amenable to an appeal under the proviso.”

The Court stated: “We are of the view that the same is clearly distinguishable, and the ratio thereof has no applicability to the present situation because, in the said case, the order under challenge was one rejecting the application moved under Order VII Rule 10 or under Order VII Rule 11(d) of the CPC.”

The Court recorded: “The plaintiff who is aggrieved of the order rejecting the plaint under Order VII Rule 11 CPC cannot be left remediless or compelled to institute a fresh suit for availing such a challenge.”

Also Read: Divorced Daughters Entitled To Freedom Fighter Pension On Par With Unmarried Daughters: Madras High Court

The Court directed: “The impugned order does not stand to scrutiny and is hereby quashed and set aside. The appeal preferred by the appellant-company in the High Court is held to be maintainable and hence, restored to its file and original number. The High Court shall consider and decide the same on merits, in accordance with law. The appeal is allowed accordingly. No order as to costs.  Pending application(s), if any, shall stand disposed of.”

Advocates Representing the Parties

For the Petitioners: Mr. Jay Savla, Sr. Adv. Mr. Amol Doijode, Adv. Mr. Prabhat Chaurasia, Adv. Mr. Anirudh Jamwal, Adv. Ms. Kenisha Savla, Adv. Mr. Aditya Bajaj, Adv. M/S Mps Legal, AOR
For the Respondents: Mr. Sukumar P. Joshi, Sr. Adv. Mr. Bhaskar Nayak, AOR Mr./Ms. Raina Anand, Adv.

Case Title: MITC Rolling Mills Private Limited and Another v. M/s Renuka Realtors and Others
Neutral Citation: 2025 INSC 1300
Case Number: Civil Appeal No(s). of 2025 (Arising out of SLP (Civil) No. 10428 of 2025)
Bench: Justice Vikram Nath, Justice Sandeep Mehta