Rule applying lower commercial-court threshold only to suits filed after May 3, 2018 is constitutional, Delhi High Court rules

Respondent No. 2 instituted a recovery suit in 2016 for ₹35,50,000, alleging that ₹27,92,467 remained due for supplied aluminium products.

At that time, the specified-value threshold under the Commercial Courts Act, 2015 was ₹1 crore, and the suit proceeded as an ordinary civil suit.

The 2018 Amendment reduced the threshold to ₹3 lakh with effect from 3 May 2018.

In 2025, when the suit was at the evidence stage, the Petitioners applied under Order VII Rule 11 CPC for rejection of the plaint, arguing that the dispute should have been transferred to a Commercial Court under Section 15 of the 2015 Act.

The Trial Court dismissed that application, holding that the Amendment applied only to suits instituted on or after 3 May 2018; the Revision Petition was also dismissed.

The Petitioners then challenged the constitutionality of Section 19 of the Amendment Act under Article 226.

1. Whether Section 19 of the 2018 Amendment Act, which limits the Amendment’s application to cases instituted on or after 3 May 2018, violates Article 14 of the Constitution

2. Whether the reduced specified-value threshold and Section 15 of the 2015 Act required pending suits instituted before 3 May 2018 to be transferred to Commercial Courts, notwithstanding Section 19

Article 14 permits legislative classification where it rests on an intelligible differentia and that differentia has a rational nexus with the statute’s object.

A legislative cut-off date is ordinarily within the Legislature’s policy discretion; prospective operation alone does not render a provision unconstitutional, unless the cut-off produces a blatantly capricious or outrageous result.

Section 19 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Act, 2018 provides that, save as otherwise provided, the Amendment applies only to cases relating to commercial disputes filed on or after its commencement.

Section 15 of the 2015 Act provides for transfer of pending suits and applications relating to commercial disputes of the specified value to the competent Commercial Court or Commercial Division.

In Satyanarain Khandelwal v. Prem Arora, 2022 SCC OnLine Del 2142, the Delhi High Court held that Section 19 confines the Amendment to cases instituted on or after 3 May 2018 and rejected a retrospective construction.

The Court treated the date of institution as an ascertainable basis for distinguishing cases governed by the amended threshold from earlier cases.

It found that applying the amended regime to pending suits could unsettle proceedings at different stages of trial, disrupt applicable procedure and timelines, and cause administrative and practical difficulties; limiting the Amendment prospectively therefore served the orderly implementation of the commercial-court regime.

The Petitioners did not establish that this temporal classification lacked an intelligible criterion or a rational connection to the Amendment’s purpose.

The Court also held that Namita Gupta v. Suraj Holdings Ltd., 2024 SCC OnLine Del 143, did not determine the applicability of the Amendment to suits instituted before 3 May 2018.

It dismissed the writ petition challenging Section 19 and disposed of any pending applications.