Case Briefs
Truth and Youth (TAY) 2021. All rights reserved.

Span Healthcare Pvt. Ltd Vs Vishal Sharma


Author: Parnika Choudhary, 3rd year student at Bharati Vidyapeeth University.


Citation: N/A

Date of Decision: April 16, 2021 

Bench: Jyoti Singh 

Original Copy: N/A

Status involved: Code of Civil Procedure, 1908,  The Special Courts Act, 1979, The Commercial Courts Act, 2015,   The Constitution of India, 1950

 

Issues in question: 

  • Whether it was possible to maintain the appeal in this case?
  • Is the challenged order granting leave in a suit by the trial court an interlocutory order?

Background of the case:

  • The petitioner, in this case, is Span Healthcare Private Ltd., whereas the defendant, Vishal Sharma, is the owner of a company called Mega Care International.
  • Span Healthcare Private Ltd., the petitioner, is a firm established under the Company Law that works in the healthcare field and sells surgical equipment. In addition, this company is the exclusive supplier of ‘Haemonetics’ pharmaceutical products in India. On the other side, the defendant is the owner of a company called M/s. Mega Care International. The company’s primary business is delivering medical equipment, disposables, and other such goods.
  • The petitioner and the defendant signed a memorandum of understanding (MOU) in 2009-2010 in which the petitioner committed to offering “Haemonetics” by providing the defendant distributorship for 27 months, with the option of an extension on mutually agreed terms.
  • Although the MOU had ended in 2012, the parties continued to do business on mutual understanding until a disagreement developed in 2016 when the defendant, despite receiving the products on schedule, began to fail in providing payments.
  • Despite acknowledging that the payments were due and even assuring the petitioner that they would be delivered, the defendant failed to provide them, and the parties exchanged several emails about it. In addition, the whole money paid to the defendant, about Rs 1.06 crores, was bargained for a final settlement of Rs 50 lakhs, which the petitioner consented to.
  • The defendant, on the other hand, ceased paying the decreased final settlement amount. As a result, the petitioner had no choice but to file a complaint in a lower court.

Judgment:

  • Arguments between both the parties: 
  • The defendant’s experienced counsel filed an objection, claiming that because the challenged judgement is an interlocutory order, the revision petition is not maintainable under Section 8 of the commercial court’s statute.
  • On the other hand, the petitioner’s lawyer reacted to the defendant’s attorney by claiming that the matter is maintainable. The lawyer went on to argue that after the parties’ rights have been established, the order cannot be referred to as an interlocutory order. According to many previous decisions of this court, such review petitions under Section 115 of the Code of Civil Procedure are maintainable against an order granting leave to the defendant in a summary suit under Order XXXVII of the Civil Procedure Code.
  • According to previous rulings, the plea in Spicejet Ltd. vs Arun Kumar (2017) was brought using Article 227 of the Indian Constitution, and the initial dispute was not a commercial one. A Trial Court judgement granting permission to defend might be challenged in a revision petition, the Court said in that case. Because the complaint was not brought under the Commercial Courts Act, 2015 Section 8 of the Act did not apply, and the Court had no need or opportunity to address the requirements of the Section.
  • Similarly, in the two other rulings,  Netrapal Singh vs Ravinder Kumar Kalyani (2019) and Versatile Commotrade Pvt. Ltd. vs Maniram Sh. Munni Ram Through LRs & Ors., (2019). The cases were not brought under the Commercial Courts Act and hence the provisions of Section 8 of the Act were not applicable. The revision petitions were maintainable, and the Court granted them because Section 8 of the Act did not apply. 
  • In light of the preceding decisions and the legislative meaning underlying Section 8 of the Act, it was concluded that the contested order is interlocutory. The current petition is not maintainable due to Section 8’s restriction.
  • As a result, the plea for reconsideration is dismissed, leaving the Petitioner free to pursue legal action as needed. This Court has not decided on the merits of the case, including the Petitioner’s alternative argument that conditional permission should have been given even if the Trial Court was inclined to grant leave to defend.

Critical Analysis:

  • In this case, the Delhi High Court had to decide whether or not the review petition may be sustained.
  • The revision plea is rejected in this case, leaving the petitioner free to seek appropriate legal remedies. This Court has not decided on the merits of the case, including the Petitioner’s alternative claim that conditional permission should have been given even if the Trial Court was inclined to grant leave to defend.
  • Several times throughout the decisions, the phrase “interlocutory orders” is mentioned and interpreted. According to the ruling, an interlocutory order shall not be regarded as a judgment unless it affects the party’s valued rights or causes severe unfairness to the party.

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