kandharkar's Commentary on The Commercial Courts Act, 2015

The Commercial Courts Act, 2015 – Description and Commentary

Overview:

The Commercial Courts Act, 2015 was enacted by the Parliament of India to streamline and expedite the resolution of high-value commercial disputes. It is a landmark reform aimed at improving the ease of doing business in India by creating a specialized judicial framework for commercial litigation.

Key Features:

• Establishes Commercial Courts, Commercial Divisions, and Commercial Appellate Divisions in the High Courts and district-level judiciary.

• Applies to commercial disputes of a specified value (initially ₹1 crore, reduced to ₹3 lakh after the 2018 amendment).

• Covers a broad range of matters, including disputes related to:

  • Trade and commerce

  • Intellectual property rights

  • Construction contracts

  • Joint ventures and shareholder agreements

  • Insurance and banking

• Mandates pre-institution mediation for cases not requiring urgent interim relief.

• Provides for strict timelines, case management hearings, and summary judgments to reduce delays.

• All proceedings must be conducted in accordance with the Commercial Courts (Procedure) Rules, 2018.

Commentary:

1. Speed and Efficiency:

The Act addresses chronic delays in civil litigation by introducing time-bound processes. Case management hearings and summary judgments are significant tools to prevent frivolous delays, encouraging early disposal of cases.

2. Specialization of Courts:

By creating dedicated commercial courts and divisions, the Act enhances judicial expertise in complex commercial matters. This specialization leads to more consistent and informed judgments.

3. Improved Business Climate:

One of the key motivations behind the Act was to improve India's ranking in the World Bank's Ease of Doing Business Index. A fast and reliable commercial dispute resolution mechanism builds investor confidence and supports business growth.

4. Pre-Institution Mediation:

The mandatory mediation provision (where applicable) promotes out-of-court settlements and helps reduce the burden on courts. However, in practice, its success depends on effective mediation infrastructure and parties' willingness to settle.

5. Challenges:

• Capacity issues: Not all districts have well-equipped commercial courts.

• Training gaps: Judges may lack specialized training in commercial law.

• Enforcement delays: Even after judgments, execution of decrees can be slow.

• Limited awareness: Many litigants and lawyers are unaware of the streamlined mechanisms under the Act.

Conclusion:

The Commercial Courts Act, 2015 is a progressive step toward making India a hub for commercial dispute resolution. It aligns with global best practices by focusing on speed, efficiency, and expertise. However, its success depends on continued judicial capacity-building, infrastructural improvements, and greater awareness among stakeholders.