Court Must Scrutinise Invocation Of Expression 'Urgent Interim Relief' By Litigants U/S 12A Of Commercial Courts Act: Delhi High Court

For context, Section 12A mandates mediation before the institution of a commercial suit.

Sub-section (1) thereof carves out an exception in suits where the plaintiff “contemplates urgent interim relief”.

The legislative intent behind this set-up is to foster a culture of amicable settlement and reduce unnecessary litigation.

However, stating that there is a growing pattern among parties to circumvent the statutory requirement of pre-institution mediation, the Court said extensive judicial scrutiny is necessary into the question whether the suit indeed contemplates an urgent interim relief.

At the outset, Justice Purushaindra Kumar Kaurav pointed out that the expression “contemplates urgent interim relief” remains undefined in the provision.

Thus, the central question before the bench was whether a simple assertion of urgent interim relief is sufficient for a litigant to fall in the exception or the same is tempered by some pragmatic considerations.

The Court in its 44-page judgment said that at first blush, the expression may indicate requiring only the existence of an urgent interim relief and nothing more. However, the Court said, such an existence of urgency must be proved beyond plain assertions. It observed,

“The phrase “contemplate any urgent interim relief” demands an elevated level of scrutiny as it is not a box to be checked at the plaintiff's sole discretion. To strike a balance, though the urgency is viewed from the plaintiff's perspective, but further scrutiny of the legitimacy of claim for exemption, by the Court, is crucial. This check-and-balance prevents abuse of process.”

The Court said its role in such cases is somewhat akin to a sentinel at the door of the Commercial Court— it checks the plaintiff's “urgent” ticket. If the ticket (the claim of urgency) is valid, entry without mediation is allowed; if the ticket lacks genuineness, the plaintiff is rerouted to the mediation door.

The Court then proceeded to break down the expression word by word and ascertain its meaning.

The word “contemplates”, it said, is not to be construed as a mere ornamental language, but a term connoting that the plaintiff must, at the time of institution of the suit, “has anticipated or reasonably foreseen” the need for an urgent interim relief.

“It entails a conscious application of mind to the factual substratum of the case, where the cause of action is so inherently exigent that any delay caused by the mediation process would cause irreparable prejudice. Such contemplation necessitates…that the cause of action is so pervaded by exigency that the procedural detour of mediation would occasion grave and irreparable prejudice. The urgency contemplated must, therefore, be neither speculative nor presumptive, but must be anchored in specific factual predicates, discernible ex facie from the pleadings, cause of action as also the conduct of the plaintiff.”

The term “urgent”, the Court said, captures a situation of critical immediacy and exigency, where the plaintiff is genuinely precluded from awaiting the outcome of the mediation mechanism due to the impending risk of irretrievable harm.

“In the determination of urgency, time is of utmost essence…the invocation of urgency must transcend mere perfunctory allusions, and instead find expression through averments in the pleadings, which, when subjected to judicial scrutiny, disclose a bona fide and imminent necessity for protective relief at the threshold stage,” said the Court.

The words “interim relief”, it further held, pertain to an interlocutory remedy aimed at preserving the substratum of the dispute, protecting legal and forestalling irreversible injury before the lis attains final adjudication.

“A bald or mechanical assertion of urgency, bereft of evidentiary underpinning, is insufficient to invoke the statutory exemption. Courts must remain vigilant against attempts to circumvent the legislative intent through superficial pleas of urgency, and are duty-bound to assess whether the claimed exigency withstands the rigours of judicial scrutiny as a bona fide invocation of the proviso rather than a stratagem to evade compliance with the mandatory pre-institution mediation framework,” it said.

The Court cautioned that the term "urgent" contemplates a narrow class of situations wherein the plaintiff is confronted with such imminent and irreparable peril to their rights or interests that adherence to the pre-institution mediation process would be not only unreasonable or unjust but might also defeat the ends of justice.

“The narrow scope of exemption could also be understood from an inherent understanding that all interim reliefs are primarily premised on a sense of urgency…Despite so, the legislative usage of the word “urgent” along with “interim relief” is certainly intended to indicate an immediate threat to the rights of the plaintiff, something that could potentially defeat the right if the intervention of the Court is not made at the earliest opportunity, which may not always be the case with other interim reliefs,” the Court said.

To sum up, the Court held that all suits knocking on the doors of Commercial Courts after bypassing the mandatory mediation, must at the threshold demonstrate that they fall within the urgent interim relief exception with a bona fide, substantiated urgency.

The Court however clarified that the provision does not necessarily require the grant of interim relief at the admission stage.

“It only requires that the interim relief is contemplable from the plaint, cause of action etc., and interim relief may be considered after issuance of notice as well. Thus, the Court is required to take a holistic view of the matter.”

Nevertheless, it said Courts must remain vigilant against attempts by unscrupulous litigants to abuse the exemption under Section 12A by mechanically appending a plea for urgent interim relief as a façade to circumvent the statutory mandate of pre-institution mediation.

“Such conduct erodes the sanctity of the legislative framework and subverts the object of reducing the burden on Courts through alternative dispute resolution mechanisms…Courts must rigorously assess the genuineness of the asserted urgency and reject suits where the plea for interim relief is palpably contrived or unsubstantiated,” the Court held.

Before parting, the Court also listed following illustrative factors to be considered at the threshold while evaluating the maintainability of a suit without compliance with Section 12A:

(i) the origin and timeline of the cause of action,

(ii) the timing and manner of the plaintiff's approach to the Court,

(iii) whether adherence to the pre-institution mediation mechanism under Section 12A would operate to the detriment or prejudice of the plaintiff.

Appearance: Mr. Harish Malhotra and Mr. Dayan Krishnan, Sr. Advs. with Mr. Apoorv Agarwal, Mr. Manav Goyal, Ms. Ritika Gusain, Mr. Sukrit Seth, Ms. Amrita Sony and Ms. Aastha Arora, Advs for Plaintiff; Mr. Rajiv Nayar, Sr. Adv. with Mr. Anirudh Sharma, Ms. Meghna Mishra, Mr. Tarun Sharma and Ms. Ujjwala Gupta, Advs. for D-1. Mr. Rajiv Nayar, Sr. Adv. with Mr. Sanyam Khetarpal, Ms. Devika Mohan, Ms. Sonal Gupta and Ms. Lisa Sankrit, Advs. for D-2. Mr. Sidhant Kumar, Ms. Ekssha Kashyap and Ms. Shagun Chopra, Advs. for D-4. Mr. Jayant Mehta, Sr. Adv. with Mr. Raghav Chadha, Mr. Mukund Rawat, Mr. Nishant Upadhyay and Mr. Akash Mahwani, Advs. for the applicant in I.A. 14933/2025

Case title: M/S Exclusive Capital Limited v. Clover Media Private Limited & Ors.

Citation: 2025 LiveLaw (Del) 961

Case no.: CS(COMM) 399/2025

Click here to read judgment