Comparison: overview of Civil and Commercial Trial

Laws can be either substantive in nature or procedural in nature. Substantive laws determine the rights and obligations of the parties, whereas procedural laws provides the mechanism for enforcement of the rights and liabilities. The more robust and speedier the mechanism, the better will be the realization of the substantive rights.

The CPC regulates the procedure for civil trial and the Commercial Courts Act, 2015 regulates the procedure for commercial trials, which is essentially the civil procedure with some amendments to make it dispute resolution faster and with less time and costs overruns.

Overview of Civil Trial-:

The suit is commenced by the presentation of plaint to the proper officer of the court in duplicate. If the same is admitted, as a next step, summons have to be served on the defendant to appear within 30 days of the service of summons and file a written statement.?This period of 30 days can be extended to 90 days by the Court. If the defendant does not file the written statement even within this time, then the court may in its discretion allow it to file the same on a subsequent date if it is able to show a sufficient cause for condonation of delay.

Next, after the completion of pleadings, if either party wants the other side to disclose a document in its possession or to answer a list of question, it may with the permission of the court seek discovery or interrogatories. A party may also call upon the other side to allow inspection of documents.

At the date of first hearing of the suit, the court can orally examine the parties with a view to ascertaining the admissions and denials of the parties. The admissions and denials are not given on oath and therefore, a person cannot be prosecuted for giving false evidence under section 195 CrPC. The object of the admissions and denials is to identify the precise area of controversy between the parties.

At/before the settlement of issues, original documents that have been relied upon the pleadings have to be submitted. If found inadmissible or irrelevant, they may be rejected or they may be admitted. The court may frame issues on material proposition of facts and law which are admitted by one party and denied by the other.

Within 15 days of the issues being framed, the parties are required to give a list of witnesses. A person who is not on the list can only be summoned when the party shows sufficient cause for omission and the court records reasons for the same. If the witness who is summoned by the court either to give evidence or to produce document, fails to comply with the notice, the court can use coercive measure to enforce attendance which may include issuance of proclamation, or issuing bailable or non-bailable warrants or attachment of property.

In the hearing of the suit, it is usually the Plaintiff who has the right to begin, unless the Defendant sets up a ground of maintainability in which case, the defendant has a right to begin.

The examination in chief of the witnesses must /be on affidavit and the cross-examination and re-examination has to be done either by the court or commissioner. It is advisable when the same is taken by a commissioner, it is simultaneously be recorded by audio-visual means.

After the case has been heard the court shall pronounce a judgment. The judgment shall contain the facts, the points for determination, decision of the court and the reasons for the same.

Overview of the Commercial Trial

As per section 12 A of the CC Act, a commercial suit cannot be instituted until the plaintiff exhausts the remedy of pre-institution mediation. In this, plaintiff shall make an application for pre-institution mediation by paying an application fee of Rs. 1000. The respondent is issued a notice to appear within 10 days. If the respondent fails to appear, another notice a final notice is issued to the respondent. If the respondent does?not appear, mediation process is termed as non-starter. If the respondent appears, the parties are given 3 months time to complete the process, which can be extended by 2 months with the consent of the parties. A one tine mediation fees is to be shared equally between the parties.

Pleadings-: After the institution of plaint, the defendant is required to file a written statement within 120 days from the service of summons. If the same is not filed within the same, the right to file the written statement stands forfeited. The denial in the written statement must be specific and the reasons for the denial be given. In case the objection is to jurisdiction and valuation of the suit, the defendant must also give her/his statement as to the same.

Further, it is also pertinent to mention that all documents in possession, power, custody pertaining to the case whether they are in support or adverse must be filed by the party. Particulars such as whether the document is original or photocopy, whether it is through email or executed by both parties, its custody is with one party or both must be stated. Preparation of such a list with these specifications leave no scope for inadvertent errors by the party. The fact that all such documents have been filed must be supported by a Statement of Truth. ?

Inspection-: Within 30 days of the completion of the pleadings, the parties shall allow the inspection of documents disclosed.

Admissions and denials of documents-: Within 15 days of the inspection, the parties must state whether they admit or deny the correctness, existence, execution or custody of the documents. An affidavit shall be filed along with the admissions and denials confirming the statement.

Case management hearing-: The court shall hold the cmh not later than 4 weeks from the date of filing the affidavit of admission and denial of documents.

In a cmh, the court may decide any pending application for summary judgment. After examining the pleadings, documents and examination under Order X rule 2, the court has power to frame issues. Thereafter, the court will fix the date by which the affidavit of witnesses is to be filed, evidence of the witnesses is to be recorded, fix the date by which the written arguments are to be filed and oral arguments are to be heard. The court will also set time limits for the parties to address oral arguments.

Evidence-: Affidavit of all witnesses shall be filed simultaneously at the time directed in the case management hearing. Court may ints discretion may reject, redact or return any portion of the evidence.

The arguments must be closed within 6 months of the case management hearing. The judgment shall be pronounced within 90 days of the conclusion of arguments which must be communicated to the parties through email or otherwise.

Advantages-:

1.????Time-bound procedure-: Elaborate and mandatory timelines have been set in commercial trials which ensure that the entire procedure is completed within a specified time period. Firstly, there is time limit for filing written statement, next for inspection and admissions and denial of documents, for holding case management hearing and for completion of arguments within the case management hearing and lastly w.r.t. pronouncement of judgment.

2.????Elaborate proof as to documentary evidence-: All documents in possession, power, control or custody have to be filed irrespective of whether they are in support or adverse to the party’s claim. This has to be supported by a Statement of Truth. Further, it must be stated whether the document is in original or photocopy, is it executed through email or bilaterally executed, its in the custody of one party or both parties.

The admissions and denials of documents, which is also supported by an affidavit must also state whether the document is admitted or denied in terms of its correctness, existence, execution, custody of the document. The reasons for admitting or denying must be stated. Such kind of elaborate procedure leaves no scope for inadvertent errors, thereby giving either party a chance to filed documents at a belated stage, thus prolonging the proceedings.

3.????Court’s power wr.t. witness evidence: The Court has power to return, reject or redact any portion of the evidence of the examination in chief that it considers inadmissible.

?4.????Case management hearing-: In this hearing, the court has power to fix the date for leading evidence, filing written arguments as well as presenting oral arguments. This is done to ensure that the process of framing of issues till the conclusion of arguments is completed within a span of 6 months, thus ensuring time-bound litigation.

?5.????Appeal-: In a commercial litigation, no civil revision application/petition shall lie against an interlocutory order and the same may only be raised in appeal against the final decree. This has reduced the ability of the parties to appeal against interim orders as dilatory tactics.

?6.????Compensatory costs-: The biggest reason of the delay in proceedings is the litigants themselves who may resort to filing frivolous claims or defences. In the CC Act, the ceiling for the imposition of such costs has been removed, so that the court can make it truly prohibitive and punitive for the parties to resort to such tactics.

?Thus, CC Act has not only incorporated strict timelines w.r.t. procedure but also embedded such practices that prevent the adoption of dilatory tactics. These include the elaborate rules as to evidence – as to oral or documentary, limited nature of appeal as well as punitive compensatory costs which make it punitive for parties to adopt tactics to prolong the proceedings. It thus, is a step in the right direction to bring an end to endless litigation.