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TMI Blog2024 (1) TMI 928X X X X Extracts X X X X X X X X Extracts X X X X ..... d Conciliation Act, 1996. The intent is to consider interest only until the arbitration is invoked, thereby establishing a definitive cut-off for calculating the aggregate value for jurisdictional purposes. The calculation presented by the Petitioner conflicts with the proper interpretation of Section 12 of the CCA. It is not permissible to apply interest to the original value of both the claim and counter-claim up until the filing date of petition under Section 34 of the Act. Accepting such a method would imply that in any arbitration case, the Specified Value would continually get revised. Consequently, if the Specified Value is initially below the pecuniary jurisdiction of this Court, it would eventually fall within the jurisdiction of a High Court simply due to the accrual of interest over time. This outcome would contravene the legislative intent behind establishing a specific threshold for the pecuniary jurisdiction of the Courts. Reliance placed upon a Division Bench judgment of this Court in NATIONAL SEEDS CORPORTION LTD. ANR. VERSUS RAM AVTAR GUPTA [ 2021 (12) TMI 1479 - DELHI HIGH COURT] , wherein the Court took into consideration only the portion of interest cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court Act, 1966 ( DHC Act ) defines the ordinary original civil jurisdiction of this Court. According to this provision, the jurisdiction of this Court is applicable in every suit where the value of the subject matter exceeds INR 2 crores. Since the present proceedings arise from an Arbitral Award, we have to refer to Section 12(2) of the Commercial Courts Act, 2015 ( CCA ) which outlines the method for determining the Specified Value in an arbitration of a commercial dispute. This provision stipulates that the aggregate value of both the claims and counter-claims as detailed in their respective statements shall be the basis of determination of the Specified Value. In order to entertain the present petition, the Specified Value derived from the combined value of the claim and counterclaim as stated in the respective statements, must be more than INR 2 Crores. 3. The Petitioner, in Paragraph 35 of the Petition, declared the Specified Value as INR 2,22,83,947.3. This figure comprises a claim of INR 1,62,42,833 and a counter-claim of INR 60,41,114.31. However, in response to the present Interlocutory Application, the Petitioner revised this value to INR 2,00,75,422.8, breaking dow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on till the date of realization (W ) 2 years + 10 months + 18 days 2 x (18% of 4,65,594.00) + (10/12) x (18% of 4,65,594.00) + (18/365) x (18% of 4,65,594.00) 1,67,613.84 + 69,839.1 + 4,132.944 = 2,41,585.884 TOTAL AMOUNT (X + Y + Z + W ) 1,02,72,467.1 Applicable GST of 18% on the Total Amount (G ) 18% of 1,02,72,467.1 18,49,044.08 AGGREGATE VALUE OF THE CLAIM (A ) (X+ Y + Z+ W +G ) 1,21,21,511.2 TABLE 2 AGGREGATE VALUE OF THE COUNTER CLAIM FILED ON 07.10.2021 Duration Calculation Amount (INR) Counter Claim amount (XX) 52,53,142.88/- 52,53,142.88/- 18% Interest pendente lite a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osts did not claim interest from the date of the arbitration notice. The relevant sections of these documents are reproduced below to provide a detailed reference: C. Award of cost of litigation necessitated due to arbitrary action of Respondent and Arbitration costs along with interest at the rate of 18% per annum in favour of the Claimant; Therefore, it is most humbly prayed that this Hon'ble Tribunal may be pleased to pass an Order allowing the Claimant's claim towards Legal Costs amounting to Rs. 4,65,594/- (Rupees Four Lakhs Sixty Five Thousand Five Hundred Ninety Four Only) along with interest @ 18% per annum. (b) GST will not be applied to the Cost of Litigation , but it will be applicable only to the Risk and Cost Amount . This is because the Respondent, in their statement of claim, did not request the inclusion of GST on the cost of litigation. (c) Interest on the counter-claim should accrue from the date the counterclaim was filed, not from the date on which arbitration was invoked. This is in line with the specific request made by the Petitioner in their counterclaim, where they have expressly sought interest starting from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision implies that the assessment should focus on the core claim and counterclaim values, as on the date of presentation, rather than the additional interest calculated till the date of filing of the present petition. 9. Section 12(2) of the CCA stipulates that the aggregate value of the claim and any counter-claim in a commercial dispute arbitration forms the basis for determining the pecuniary jurisdiction of the Court. In cases where the Statement of Claim includes a component of interest, such as in the present case, it is necessary to consider the portion of interest accrued up to the date of invocation of arbitration as part of the aggregate value , in accordance with Section 12(2) of CCA. However, this provision cannot be interpreted as requiring the computation of interest up to the commencement of proceedings under Section 34 of the Arbitration and Conciliation Act, 1996 ( Act ). The intent is to consider interest only until the arbitration is invoked, thereby establishing a definitive cut-off for calculating the aggregate value for jurisdictional purposes. 10. The calculation presented by the Petitioner conflicts with the proper interpretation of Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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