2021 (12) TMI 1479 - HC - Indian Laws

Pecuniary (monetary) Jurisdiction - future and pendente lite interest - whether interest claimed in the Statement of Claim can be taken into account for determining the Specified Value for the purposes of the pecuniary jurisdiction of the Court? - HELD THAT - Merely because Section 12(1)(a) of the Commercial Courts Act specifically provides that the interest claimed till the date of filing of the suit is to be taken into account for determining the Specified Value , cannot detract from giving full effect to the value of claim in an arbitration for purposes of Section 12(2) of the Commercial Courts Act. It is settled principle of interpretation of statute that words of a statute are first understood in their natural and ordinary sense, unless that leads to some absurdity or unless there is something in the context, or in the object of the statute to suggest the contrary. In Section 12(2) of the Commercial Courts Act there are no reason to restrict the ambit and width of value of claim in arbitration from its natural meaning of including interest claimed till the date of invocation of arbitration. The portion of interest claimed till the date of invocation of arbitration would therefore, have to be taken into consideration under Section 12(2) of the Commercial Courts Act for determining the Aggregate Value of the claim. There is no dispute, in the present case, that when such interest is added, the Aggregate Value of the claim would exceed ₹2,00,00,000/- (Rupees two crore) making the petition under Section 34 of the Act beyond the pecuniary jurisdiction of the learned District Court. There are no infirmity in the Impugned Order - The appeal is, accordingly, dismissed.

Summary

Issues:
Challenge to Order under Section 34 of the Arbitration and Conciliation Act, 1996 for lack of pecuniary jurisdiction.

Analysis:
1. The appeal challenges an Order dismissing a petition under Section 34 of the Arbitration and Conciliation Act, 1996 for lack of pecuniary jurisdiction due to the claim amount exceeding the specified limit.
2. The appellants argued that interest claimed in arbitration should not be considered for determining pecuniary jurisdiction, citing judgments and the Commercial Courts Act.
3. The Court analyzed Section 12 of the Commercial Courts Act, emphasizing the inclusion of the "Aggregate Value" of the claim and counter-claim for jurisdictional purposes.
4. The Court rejected the appellants' arguments, stating that interest claimed till the invocation of arbitration should be added to the claim's value for jurisdictional assessment.
5. The Court clarified that different interpretations for suits and arbitrations under the Commercial Courts Act do not exempt interest claimed in arbitration from jurisdictional considerations.
6. The Court distinguished previous judgments cited by the appellants, highlighting the specific context of interest claims in those cases.
7. The respondent's claim for future and pendente lite interest was analyzed, confirming that interest accrued till the date of invocation of arbitration should be factored into the claim's value.
8. The Court upheld the Impugned Order, dismissing the appeal due to the claim exceeding the pecuniary jurisdiction limit, allowing the appellants to file in the appropriate court.
9. No costs were awarded in the judgment.