The Commercial Courts Act, 2015 promises a specialised and time-bound procedure, but that procedure applies only when two requirements meet: the dispute must be “commercial” under Section 2(1)(c), and it must be of the specified value assigned to the relevant Commercial Court or Commercial Division. Section 12 supplies the valuation rules. It looks deceptively mechanical. In practice, it determines forum, procedural track, transfer, appellate route and sometimes the fate of an urgent filing.
The statutory floor for specified value is ₹3 lakh, subject to the court structure and pecuniary limits notified for the relevant territory. The number written in the valuation paragraph of a plaint is not conclusive. Courts must identify the real subject matter and apply the category prescribed by Section 12 of the Commercial Courts Act.
Money claims include pre-filing interest
Where the relief is recovery of money, Section 12(1)(a) counts the money sought to be recovered together with interest computed up to the filing date. This rule matters when principal alone falls below the applicable threshold. A plaintiff cannot ignore accrued contractual or statutory interest while simultaneously claiming it in the prayer. Future or pendente lite interest is different: the statutory wording stops the specified-value calculation at filing.
Damages claims require candour. A genuinely unliquidated claim may be estimated on a rational basis, but a round figure inserted only to enter a Commercial Court invites challenge. Pleadings should state the contractual measure of damages, invoices or lost-margin method, relevant period and supporting documents. Specified value is not an invitation to convert speculation into jurisdiction.
Property disputes use market value, not the relief’s face value
For movable property or a right in it, Section 12(1)(b) adopts market value on the filing date. Section 12(1)(c) does the same for immovable property or a right in it. A suit seeking an injunction over high-value property therefore cannot automatically be valued at a nominal amount merely because no sale price is directly claimed. The subject of the relief is the property right, and the statute selects market value.
Evidence should match the asset: recent arm’s-length transactions, circle or guidance value where relevant, valuation reports, audited inventory records or recognised pricing data. Circle value may be a useful indicator, but it is not always synonymous with market value. The chosen methodology should explain both the date and the interest valued. For example, the interest may be ownership of the whole property, a leasehold interest or a limited contractual right.
Intangible rights expose the hardest valuation problem
Section 12(1)(d) covers “any other intangible right” and initially takes the market value estimated by the plaintiff. This includes disputes over licences, trademarks, copyrights, technology rights, data access, distribution entitlements and contractual exclusivity. The plaintiff’s estimate is the statutory starting point, not an immunity from scrutiny.
A defensible estimate may use royalty savings, comparable licences, revenue attributable to the right, replacement cost or discounted cash flow, depending on the relief. A cease-and-desist claim involving a nationally exploited mark should not be assigned a token value without explaining the commercial interest restrained. Conversely, the defendant should not demand enterprise valuation when the suit concerns a narrow territorial or time-limited licence. The object is to value the right actually placed in dispute.
Arbitration has a special aggregation rule
Section 12(2) provides that, in arbitration of a commercial dispute, the aggregate value of the claim and counterclaim stated in the respective pleadings determines whether related proceedings fall within the Commercial Court, Commercial Division or Commercial Appellate Division. This is easy to miss when the original claim is modest but the counterclaim is substantial.
The sub-section is expressly framed for arbitration. It should not be casually transplanted into an ordinary commercial suit as a universal rule for adding every counterclaim to the plaintiff’s valuation. The Act’s earlier provision for transfer based on a specified-value counterclaim in suits was omitted in 2018. Litigants must distinguish the arbitration rule from the separate CPC and local pecuniary-jurisdiction consequences of a civil counterclaim.
Commercial character comes before commercial procedure
A high valuation does not make a dispute commercial. In Ambalal Sarabhai Enterprises v. K.S. Infraspace, the Supreme Court emphasised that the statutory definition of commercial dispute must be applied carefully. The specialised forum cannot assume jurisdiction merely because parties are business entities or the underlying property is valuable. The pleaded transaction must fit a category in Section 2(1)(c).
Section 12(3) then limits collateral delay: no appeal or civil revision lies from an order of a Commercial Division or Commercial Court finding that it has jurisdiction under the Act. That makes the first valuation hearing important. Parties should place the necessary material before the trial court instead of treating valuation as a technical objection to be repaired later.
A filing checklist that avoids forum failure
A commercial plaint or application should separately state: the clause of Section 2(1)(c) that makes the dispute commercial; the applicable specified-value threshold; the correct Section 12 valuation category; the calculation date; the evidence supporting market value or estimated intangible value; and the distinct court-fee valuation required by applicable state law. Court fees, suit valuation and specified value may overlap, but they are not conceptually identical.
Section 12’s discipline is substantive. It prevents forum shopping by linking jurisdiction to the economic subject of the relief. The safest pleading is therefore not the highest or lowest plausible number. It is a transparent valuation that another lawyer, as well as the court, can reproduce from the statute and the evidence.
Primary references
Ambalal Sarabhai Enterprises v. K.S. Infraspace (Supreme Court)