Suit Liable To Dismissal Cannot Be Transferred To Commercial Division: Calcutta High Court

The Calcutta High Court has dismissed a 25-year-old suit between Tractel Tirfor India Pvt. Ltd. and Tractel International S.A.S., holding that the case was never legally pending and therefore could not have been transferred to the court's commercial division.

A Division Bench of Justices Debangsu Basak and Md. Shabbar Rashidi ruled on January 21 that the failure to lodge a writ of summons, which is mandatory under the High Court's Original Side Rules, rendered the suit liable to dismissal in law.

On the Original Side of the High Court, a writ of summons is required to be taken out and lodged by the plaintiff after the suit is filed so that it can be served on the defendant and call upon the defendant to enter an appearance.

Since only pending proceedings can be transferred under Section 15 of the Commercial Courts Act, the court held that the commercial division never acquired jurisdiction over the matter.

The court underscored that “pendency is a jurisdictional fact” and must be established before a transfer is ordered. It said that “in order to ascertain the pendency of the suit or application or arbitration proceeding sought to be transferred, the transferee Court has to evaluate as to whether or not any procedural law giving rise to any substantive right required the dismissal of such suit or application or arbitration proceeding and not done by such Court.”

The dispute arose from a suit instituted in 2000 by Tractel International, a French entity, against Tractel Tirfor, its subsidiary. Although the matter remained on the court's docket for years, the office of the sheriff reported, pursuant to court directions, that no writ of summons had ever been lodged. Under Chapter VIII Rules 6 and 7 of the Original Side Rules, the writ is required to be lodged within prescribed timelines. If this is not done, the suit becomes liable to dismissal unless the court grants leave.

Despite this procedural lapse, the suit was directed to be placed before the commercial division under Section 15 of the Commercial Courts Act, which allows transfer only of pending suits involving commercial disputes. The High Court said that before exercising such transfer powers, the court must examine not just whether the dispute is commercial in nature but also whether the proceeding can legally be treated as pending.

Holding that a suit which is liable to dismissal due to procedural defaults cannot be regarded as pending, the court set aside the impugned orders and dismissed the suit along with all connected applications.