120 Days deadline to file Written Statement is mandatory in Commercial Suits

Supreme Court has observed that proviso added to the Code of Civil Procedure by Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015, is mandatory and no written statement can be taken on record in commercial suits, if it is not filed within 120 days from the date of service of summons of the Suit.

The said ruling was held in the matter of SCG Contracts India Pvt. Ltd vs. K.S. Chamankar Infrastructure Pvt. Ltd (Civil Appeal No. 1638 of 2019), decided on 12.02.2019.

Challenge

The present appeal was directed against the judgment of Delhi High Court allowing a written statement filed by the defendants even though 120 days had elapsed from the date of service of summons of this Suit.

Held

The Apex Court observed that the added proviso to the CPC is mandatory in nature. The following proviso was added to Order VIII Rule 1 to the Code of Civil Procedure by the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 and was made applicable to commercial disputes of a specified value w.e.f 23.10.2015.
“Provided that where the defendant fails to file the written statement within the said period of thirty days, he shall be allowed to file the written statement on such other day, as may be specified by the Court, for reasons to be recorded in writing and on payment of such costs as the Court deems fit, but which shall not be later than one hundred twenty days from the date of service of summons and on expiry of one hundred twenty days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record.”

Another proviso was added to Order VIII Rule 10 that:

“Provided further that no Court shall make an order to extend the time provided under Rule 1 of this Order for filing of the written statement.”

The Supreme Court held that no Court shall allow the written statement to be taken on record beyond the period of 120 days, pointing to the fact that the earlier law on Order VIII Rule 1 on the filing of written statement under Order VIII Rule 1 has now been set at naught.