Appeals from Commercial Courts Below District Judge Level To be Filed Before Commercial Appellate Court At District Judge level: Kerala HC

The Kerala High Court observed that the judgment or order of a Commercial Court below the level of a District Judge in territories over which the High Courts have no ordinary original civil jurisdiction cannot be challenged before the High Court.

Such a judgment or order has to be challenged before the Commercial Appellate Court designated under Section 3A at the District Judge level, the Court said.

In that context, the Bench of Justice Anil K Narendran and Justice Harisankar V Menon observed that, "the judgment or order of a Commercial Court below the level of a District Judge in territories over which the High Courts have no ordinary original civil jurisdiction cannot be challenged before the High Court, invoking the provisions under sub-section (1A) of Section 13 of the Commercial Courts Act. Such a judgment or order has to be challenged before the Commercial Appellate Court designated under Section 3A at the District Judge level, by invoking the provisions under sub-section (1) of Section 13 of the said Act."

A petitioner challenged an order from the Commercial Courts (Principal Sub Court) in Palakkad. The respondent questioned the appeal's maintainability, arguing it should have been filed before the Commercial Appellate Court (Principal District Court), Palakkad. The petitioner contended that according to the Kerala Civil Courts Act, the District Court's appellate jurisdiction was limited to cases valued up to 20 lakhs, so the appeal should go to the High Court.

The Commercial Courts Act of 2015 established special courts for commercial disputes, which involve complex legal issues, to expedite their resolution. This Act created Commercial Courts at the district level and Commercial Divisions and Appellate Divisions at the High Court level. These courts handle cases in regions where the High Court lacks original civil jurisdiction, with appeals from these courts directed to the High Court's Appellate Division.

A 2018 amendment renamed the Act to include Commercial Appellate Courts and expanded the eligibility for Commercial Court judges to include those at or just below the District Judge level. It also established Commercial Appellate Courts at the District Judge level, covering areas without the High Court's original civil jurisdiction.

Post-amendment, Commercial Courts at the District Judge level can be established in regions where High Courts have original jurisdiction, following consultation with the High Court. States can set pecuniary limits for these courts. For cases exceeding these limits, the matter should be filed with the High Court's Commercial Division.

The High Court clarified that, "the judgment or order of a Commercial Court below the level of a District Judge in territories over which the High Courts have no ordinary original civil jurisdiction cannot be challenged before the High Court, invoking the provisions under sub-section (1A) of Section 13 of the Commercial Courts Act. Such a judgment or order has to be challenged before the Commercial Appellate Court designated under Section 3A at the District Judge level, by invoking the provisions under sub-section (1) of Section 13 of the said Act".

It was also observed that as per Section 21 of the Commercial Courts Act, its provisions take precedence over any conflicting laws or legal instruments unless stated otherwise. Therefore, The Court rejected the appellant-plaintiff's argument based on Section 3 of the Kerala Civil Courts (Amendment) Act, 2013, which sets the District Courts' pecuniary jurisdiction for appeals at up to Rs. 20,00,000/

Cause Title: Y Sleenbachen vs State of Kerala & Anr.

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