Supreme Court Explains Tests To Determine Urgency To Exempt Pre-Litigation Mediation In Commercial Suits

The Supreme Court held that when deciding a commercial suit involving a request for urgent interim relief in intellectual property infringement cases, the plaintiff's perspective must be duly considered, and courts may dispense with the mandatory pre-institution mediation requirement under Section 12A of the Commercial Courts Act, 2015 (“Act”). “The court is not concerned with the merits of the urgent relief, but if the relief sought seems to be plausibly urgent from the standpoint of the plaintiff the court can dispense with the requirement under Section 12A of the Act.”, the court said. A bench of Justices Sanjay Kumar and Alok Aradhe said that every attempt of the plaintiff to seek urgent interim relief cannot be characterised as mere camouflage to evade mediation under Section 12A of the Act. Referencing the recent case of Dhanbad Fuels v. UOI, 2025 LiveLaw (SC) 579 the Court said that the prayer for urgent interim relief by the plaintiff could be said to be contemplable when the matter is seen from the standpoint of the plaintiff after looking at the plaint, pleadings, and supporting documents to decide whether urgent interim relief is genuinely contemplated or not. “the test under Section 12A is not whether the prayer for the urgent interim relief actually comes to be allowed or not, but whether on an examination of the nature and the subject-matter of the suit and the cause of action, the prayer of urgent interim relief by the plaintiff could be said to be contemplable when the matter is seen from the standpoint of the plaintiff. Further, what is also to be kept in mind by the courts is that the urgent interim relief must not be merely an unfounded excuse by the plaintiff to bypass the mandatory requirement of Section 12A of the 2015 Act.”, the court said in Dhanbad Fuels. For more clarity, the Court distilled the legal test for rejection of the plaint and for adjudication of interim relief, as follows:"(i) Section 12A mandatorily requires pre-institution mediation for commercial suits, non-compliance of which would ordinarily render the plaint institutionally defective. (ii) A plaintiff can be exempted from the requirement of Section 12A only when the plaint and the documents attached with it clearly show a real need for urgent interim intervention. A wholesome reading of the plaint and the material annexed to the plaint ought to disclose the need for urgent relief. (iii) The court must look at the plaint, pleadings and supporting documents to decide whether urgent interim relief is genuinely contemplated. The court may also look for immediacy of the peril, irreparable harm, risk of losing rights/assets, statutory timelines, perishable subject-matter, or where delay would render eventual relief ineffective. (iv) A proforma or anticipatory prayer for urgent relief used as a device to skip mediation will be ignored and the court can require the parties to comply with Section 12A of the Act. (v) The court is not concerned with the merits of the urgent relief, but if the relief sought seems to be plausibly urgent from the standpoint of the plaintiff the court can dispense with the requirement under Section 12A of the Act.” Cause Title: NOVENCO BUILDING AND INDUSTRY A/S VERSUS XERO ENERGY ENGINEERING SOLUTIONS PRIVATE LTD. & ANR. Citation : 2025 LiveLaw (SC) 1027 Click here to read/download the judgment Also From Judgment: S.12A Commercial Courts Act | Pre-Litigation Mediation Not Mandatory In Cases Of Continuing IPR Infringement: Supreme Court

Supreme Court Explains Tests To Determine Urgency To Exempt Pre-Litigation Mediation In Commercial Suits

Yash Mittal

Tags