Lower Court Obligation Regarding Affidavit Filing under Commercial Courts Act: Is It Mandatory Below High Court Levels?
In a series of recent rulings, the Delhi High Court and the Supreme Court have clarified the requirement for filing an affidavit of admission and denial of documents in commercial cases before the district courts in Delhi. The question of whether this requirement is mandatory or directory has been a topic of debate, with the latest decisions providing much-needed clarity.
The Hon'ble Delhi High Court, in Sudhakar Singh & Anr. vs. Webkul Software Pvt. Ltd., 2020 SCC OnLine Del 436, set aside the lower court's order striking off the written statement for lack of an affidavit of admission/denial. The court held that such filing is not mandatory under Order VIII CPC as amended by the Commercial Courts Act, 2015. However, in commercial suits before the High Court, filing an affidavit of admission/denial of documents with the written statement or within 120 days of summons is mandatory, as per Chapter VII, Rule 3 of the Delhi High Court (Original Side) Rules, 2018.
The issue gains significance as there is ambiguity on whether this requirement equally applies to Commercial Courts subordinate to the High Court. In Dr. Sanchit Ahuja v. M/s. Apothecaries Pvt. Ltd., CM (M) No. 3419 of 2024, it was established that the requirement of filing an affidavit of admission and denial along with the written statement is not mandatory in proceedings instituted before Commercial Courts lower in the judicial hierarchy, particularly those functioning at the district court level in Delhi.
This mandate aligns with similar provisions applicable before the Delhi High Court, but has also been upheld in the district-level Commercial Courts of Delhi, reflecting the practical significance of managing commercial disputes efficiently at all levels of the judiciary. Each party is required to file a statement of admissions or denials of all documents disclosed and inspected along with an affidavit supporting the truthfulness of the statement. This affidavit must be filed either along with the written statement or within 120 days from the date of receipt of summons. Failure to file this affidavit within the stipulated time can lead to the court striking off the defendant’s defense and the written statement being taken off record.
In summary, defendants in commercial proceedings before Commercial Courts in Delhi must ensure filing this affidavit timely as part of their defense to avoid adverse procedural consequences. The requirement is indeed mandatory in proceedings instituted before Commercial Courts functioning at the district court level in Delhi, which are lower in the judicial hierarchy to the High Court.
It is worth noting that the provisions under the Commercial Courts Act govern this requirement, and the requirement is not explicitly mentioned as mandatory in the Code of Civil Procedure, 1908. In cases where the written statement is taken off the record due to non-filing of the affidavit of admission/denial along with it, as in Sh. Neeraj Ahuja v. AIPL Zorro Pvt. Ltd., C.M. (M) No. 2535/2024, the court may set aside the impugned order if it is found that the trial court had adopted a casual approach without due consideration of the relevant statutory provisions.
In conclusion, while the requirement for filing an affidavit of admission and denial of documents is clear in commercial cases before the Delhi High Court, there appears to be a lack of clarity on whether the said procedural aspect is equally applicable to Commercial Courts functioning at the district level. Further clarification from the courts is expected to provide a uniform approach to this important aspect of commercial litigation.
[1] Sudhakar Singh & Anr. vs. Webkul Software Pvt. Ltd., 2020 SCC OnLine Del 436 [2] Dr. Sanchit Ahuja v. M/s. Apothecaries Pvt. Ltd., CM (M) No. 3419 of 2024 [3] Mayank Gupta vs. Aditya Birla Fashion & Retail Ltd. CM (M) No. 178/2023 [4] Okay Play India Pvt. Ltd. vs. M/s A.P. Distributors & Anr. bearing no. CM (M) No. 346 of 2020 [5] M/s. Unilec Engineers Ltd. vs. HPL Electric and Power Ltd. CM (M) No. 990/2023 [6] Sh. Neeraj Ahuja v. AIPL Zorro Pvt. Ltd., C.M. (M) No. 2535/2024 [7] Pooja Die Moulds vs. Rajdhani Metal Store bearing no. CM (M) No. 496 of 2025
In a commercial context, it's essential for businesses to be aware of the requirement for filing an affidavit of admission and denial, as this can significantly impact their defense in a dispute. For instance, in proceedings before the Commercial Courts in Delhi, such as Sudhakar Singh & Anr. vs. Webkul Software Pvt. Ltd., it's mandatory to file this affidavit, while in cases heard at the district court level, like Dr. Sanchit Ahuja v. M/s. Apothecaries Pvt. Ltd., it's not mandatory but still crucial for efficient management of commercial disputes. Thus, understanding the nuances of finance and business procedures in different courts can prove vital for a successful outcome.
