Patna High Court
Railway,versusAfcon Infrastructure Limited,
- Decided
- Disposal
- ALLOWED
Holding
An Additional District Judge is not a Commercial Court under the Commercial Courts Act, 2015 and therefore lacks jurisdiction to entertain a Section 34 application; such matters must be heard by the Commercial Court constituted by the Principal District Judge.
Summary
The appellants, a group of railway officials, challenged an arbitral award of Rs.1,73,84,96,092 awarded to Afcon Infrastructure Ltd. The Additional District Judge, Patna, upheld the award and dismissed the Section 34 challenge, but the appellants appealed on the ground that the ADJ lacked jurisdiction to entertain the application. The High Court examined the definition of "District Judge" under Section 2(e) of the Commercial Courts Act, 2015 and the notifications constituting Commercial Courts in Bihar, concluding that only the Principal District Judge (as Commercial Court) can hear Section 34 applications in commercial arbitrations. The Court held that the ADJ‑XXVI was not a Commercial Court and therefore had no jurisdiction, setting aside the impugned order. The matter was transferred to the Principal District Judge, Patna, to be heard as a Commercial Court. The appeal was allowed.
Issues considered
- Whether an Additional District Judge has jurisdiction to entertain an application under Section 34 of the Arbitration and Conciliation Act, 1996 in a commercial dispute where a Commercial Court has been constituted under the Commercial Courts Act, 2015.
- Interpretation of the term "District Judge" under Section 2(e) of the Commercial Courts Act, 2015 and its applicability to Additional District Judges.
- Whether the Bihar notifications constituting Commercial Courts limit jurisdiction to the Court of the District Judge alone.
- Whether prior judgments (South Bihar Power Distribution Co., Vishal Builtech, Johnson Paints, Bihar State Road Development Corp.) are binding on the present issue.
- Whether the principle of res judicata applies to the order of the Additional District Judge.
Legislation cited
- Arbitration and Conciliation Act, 1996 — s. 34, 34(2), 34(2-A)
- Civil Courts Act, 1887 — s. 3, 8
- Code of Civil Procedure, 1908 — s. 16, 17, 18, 19, 20
- Commercial Courts Act, 2015 — s. 10, 2(e), 3, 6
Subjects
- Arbitration
- Commercial Courts
- Section 34
- Jurisdiction
- Additional District Judge
- Commercial Courts Act 2015
- Arbitral award
- Res judicata
- Statutory interpretation
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
COMMERCIAL APPEAL No.4 of 2025
In
Miscellaneous Appeal No.264 of 2024
======================================================
1. The Secretary, Union of India, Ministry of Railway, Rail Bhawan, New
Delhi - 110001.
2. The Chairman, Railway Board, Ministry of Railway, Rail Bhawan, New
Delhi - 110001.
3. The General Manager, East Central Railway, Hazipur, District Vaishali,
Bihar, Pin - 844101.
4. The Chief Engineer, East Central Railway, Mahendru Ghat, District Patna,
Pin - 800004.
5. The Deputy Chief Engineer, Construction, East Central Railway,
Mughalsarai, District Chandauli, Pin - 232101.
... ... Appellants
Versus
Afcon Infrastructure Limited, A Company registered under the Companies
Act, 1956 with its registered office situated in the State of Maharashtra at
Afcon's House, 16, Shah Industrial Estate, Veera Desai Road, Azad Nagar
Post Office P.O. Box No. 11978, Andheri (W), Mumbai - 400053 through its
Authorised Signatory G.C. Sinha Roy, AGM (Execution)
... ... Respondent
======================================================
Appearance :
For the Appellants : Dr. Mourya Vijay Chandra, CGC
Mr. Arjun Kumar, CGC
Mr. Barun Kumar Jha, Advocate
Ms. Preety Ranjan, Advocate
Mr. Gaurav Govinda, Advocate
For the Respondent : Mr. Y.V. Giri, Senior Advocate
Mr. Raju Giri, Senior Advocate
Mr. Harsh Vardhan, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD
and
HONOURABLE MR. JUSTICE KUMAR MANISH
CAV JUDGMENT
(Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD)
Date : 18-06-2026
This Commercial Appeal arises out of order dated
13.10.2023 passed in Miscellaneous (Arbitration) Case No. 37 of
2018 by learned Additional District Judge-XXVI, Patna.
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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2. By the order under appeal (hereinafter called the
‘impugned order’), the learned ADJ-XXVI, Patna has been pleased
to uphold the award passed by learned Arbitral Tribunal in ARB
No. 107 of 2016. The Tribunal has been pleased to award a sum of
Rs.1,73,84,96,092/- in favour of the respondent with further award
to pay the interest at the rate of 5% per annum from the date of
award till the date of realization and also cost of Rs.64,68,740/-.
The learned Arbitral Tribunal further directed that in case of failure
of the appellants to pay the amount under the impugned award, the
appellants would be liable to pay penal interest at the rate of 18%
per annum till the date of actual payment and also the cost on the
account of expenses will carry interest at the rate of 6% per annum
till the date of actual payment. The Tribunal further directed that
the bank guarantee will be released within 15 days from the date of
the award failing which the bank guarantee will be realized at the
interest of 3% per annum till the date of actual
communication/release is confirmed.
Submissions on behalf of the Appellant
3. Dr. Mourya Vijay Chandra, learned counsel
representing the appellants has raised various grounds challenging
the impugned award and the order passed by the learned ADJ-
XXVI, Patna in Miscellaneous (Arbitration) Case No. 37 of 2018.
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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4. At the outset, learned counsel for the appellants
submits that the learned ADJ has grossly erred in deciding the
matter under Section 34 of the Arbitration and Conciliation Act,
1996 (hereinafter referred to as the ’Act of 1996’). It is submitted
that in the case of South Bihar Power Distribution Company
Limited Vs. Bhagalpur Electricity Distribution Company
Private Limited (Miscellaneous Appeal No. 172 of 2018), a
learned Single Judge of this Court had occasion to consider as to
whether the court of learned Additional District Judge would be a
competent court in terms of Section 3 of the Commercial Courts
Act, 2015 (hereinafter referred to as the ‘Act of 2015’) read with
notification dated 03.03.2017 issued by the Department of Law,
Government of Bihar. The Court held that since the statutory court
was already notified by the State Government in exercise of power
under Section 3 of the Act of 2015, it was the District Judge posted
in the Civil Court at Divisional Headquarter alone and no other
District Judge or Additional District Judge could have jurisdiction
to hear and pass order on an application under Section 34 of the
Act of 1996. It is further submitted that in the case of M/s Vishal
Builtech India Private Limited Vs. The Union of India and
Others (MJC No. 1323 of 2018), the Hon’ble Division Bench of
this Court held that it is the Commercial Court alone who may
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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hear and dispose of an application under Section 34 of the Act of
2015. It is submitted that both the judgments of this Court were
placed before the learned ADJ, Patna which have been taken note
of in the impugned order but the learned court took a view that the
definition of District Judge as given in Section 2(e) of the Act of
2015 read with Article 236(a) of the Constitution of India could
not be brought to the notice of the Hon’ble High Court either in
the case of South Bihar Power Distribution Company Limited
(supra) or in the case of M/s Vishal Builtech India Pvt. Ltd.
(supra).
5. It is submitted that very recently, this Court had
occasion to consider an identical issue in the case of M/s Johnson
Paints Pvt. Ltd. Vs. M/s Johnson Paints Company
(Commercial Appeal No. 8 of 2024) wherein the Hon’ble
Division Bench has taken a view that by virtue of Section 21,
which gives overriding effect to the Act of 2015 and also Sections
10 and 15, even in a challenge under Section 34 of the Arbitration
Act, though ordinarily the jurisdiction lies before the Principal
Civil Court of original jurisdiction in a district, the matter shall be
filed in, and heard and disposed of by the Commercial Court
exercising territorial jurisdictional over such arbitration where
such Commercial Court has been constituted as per Section 10(3)
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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of the Act of 2015. In the case of M/s Johnson (supra), the
Hon’ble Division Bench observed that the learned District Judge
erred in making over the case to the learned ADJ-XIV. The case
was transferred to the learned District Judge, Patna who had been
constituted as Commercial Court and the order passed by the
learned ADJ has been held being without jurisdiction and non est
in law.
6. Learned counsel submits that in the case of M/s Bihar
State Road Development Corporation Ltd. Vs. M/s MG
Contractors (P) Ltd (Commercial Appeal No. 10 of 2024), this
Court again dealt with this issue in its judgment dated 08.04.2026.
This Court dealt with the notification dated 03.03.2017 and the
notification dated 02.08.2019 issued by the Law Department in
exercise of its power under Section 3 of the Act of 2015 (as
amended up to date). This Court held that on a conjoint reading of
Section 3 and Section 8 of the Bengal, Agra and Assam Civil
Courts Act, 1887 (hereinafter referred to as the ‘Act of 1887’), the
court of the District Judge and the court of the Additional Judge
are two different courts. The Courts of Additional Judges have
been envisaged for the speedy disposal of the cases pending before
any District Judge, and once the same is assigned to an Additional
Judge by the District Judge, he would discharge his duties in
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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respect of the assigned matters, and while doing so, the learned
Additional Judges would carry all the functions of a District Judge,
they shall exercise the same power as the District Judge. But
having said so, this Court has referred the notifications constituting
a Commercial Court under Section 3 of the Act of 2015. It has
been held that the notification has got itself confined to the Court
of Civil Judge (Senior Division) and to the court of District Judge,
in all the districts of the State of Bihar. The District Judge who has
been constituted as a Commercial Court within the meaning of the
Act of 2015 does not derive any power to further transfer its
adjudicatory power as a Commercial Court to the Additional
Judges.
7. It is submitted that in this case, firstly, the learned
District Judge, Patna erred in directing the office to transfer the
arbitration case to the court of ADJ-XXVI, Patna for hearing and
disposal. Thereafter, when the matter came before the learned
ADJ, Patna, the learned ADJ, Patna wrongly assumed jurisdiction
upon himself to decide the matter. It is submitted that the
impugned order passed by the learned ADJ, Patna suffers from
jurisdictional error and the impugned order is liable to be set aside
on this ground alone. It is submitted that if the appeal succeeds on
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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this ground alone, then this Court would not be required to go into
the other grounds at this stage.
Submissions on behalf of the Respondent
8. On the other hand, Mr. Y. V. Giri, learned Senior
Counsel representing the respondent, has contested the appeal
stating that the judgments of this Court in the case of South Bihar
Power Distribution Company Ltd. (supra), M/s Vishal Builtech
India Private Limited (supra), M/s Johnson Paints Private
Limited (supra), and M/s Bihar State Road Development
Corporation Limited (supra) are distinguishable. It is submitted
that the Act of 2015 is a special statute and in terms of Section 2(1)
(e) of this Act, “District Judge” shall have the same meaning as
assigned to Clause (a) of Article 236 of the Constitution of India. It
is submitted that the expression “District Judge” under Article 236
of the Constitution of India includes the District Judge, Joint
District Judge, Assistant District Judge, Chief Judge of a small
cause court, Chief Presidency Magistrate, Additional Chief
Presidency Magistrate, Sessions Judge, Additional Sessions Judge,
and Assistant Sessions Judge.
9. Mr. Giri, Learned Senior Counsel, submits that in case
of M/s Bihar State Road Development Corporation Limited
(supra), this Court has referred the Act of 1887 and held that the
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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court of a District Judge and that of Additional District Judge are
two different courts, whereas Article 236(a) is otherwise. Reliance
has been placed on the judgment of the Hon'ble Supreme Court in
the case of Santhosh Maize and Industries Limited versus State
of Tamil Nadu and Another reported in(2023) 20 SCC 356 to
submit that if any statutory rule or statutory notification contains
two expressions- one in general words and the other is in special
terms, under the rule of interpretation, it has to be understood that
the special terms were not meant to be included in the general
expression. In other words, in a statute which contains general
provision as well as special provision, the latter must prevail.
10. Learned Senior Counsel submits that in the case of
M/s Vishal Builtech India Private Limited (supra) and M/s
Johnson Paints Private Limited (supra), Section 2(1)(e) of the
Act of 2015 has not been taken into consideration. Reliance has
been placed on the judgment of the Hon'ble Supreme Court in the
case of Odisha State Financial Corporation versus Vigyan
Chemical Industries and Another reported in 2025 SCC OnLine
SC 1609 to submit that a judgment is an authority only for what it
decides. When a judgment fails to address other issues raised, it is
said to be ‘sub silentio’ and cannot be held as a binding precedent
on those undecided issues.
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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11. It is submitted that an Additional District Judge is
competent to decide appeals assigned to him by the District Judge
for disposal, and while doing so, he exercises the same power as
that of the District Judge. Reliance in this regard has been placed
on the judgment of the Hon'ble Calcutta High Court in the case of
West Bengal Housing Infrastructure Development
Corporation Vs. M/s Impression & Analogous Cases reported in
AIR 2026 Calcutta 236 and on the judgment of this Court in the
case of Smt. Narmada Devi vs. State of Bihar and Others
reported in AIR 1999 Pat 3. It is submitted that the learned
District Judge had transferred the case to the learned Additional
District Judge vide order dated 7/8/2023, but the said order was
not questioned by the appellant. It is, thus, submitted that in view
of the judgment of the Hon'ble Supreme Court in the case of
Ishwar Dutt vs. Land Acquisition Collector and Another
reported in (2005) 7 SCC 190, the order has attained finality and
the principle of res judicata shall apply.
Consideration
12. Having heard learned counsel for the parties, we have
perused the materials available on the record, including the
judgments relied upon by the parties.
13. At this stage, this Court is considering a question as to
whether the ADJ Court has jurisdiction to entertain, hear, and
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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adjudicate the application filed under Section 34 of the Act of 1996.
It is not in dispute that an arbitral award may be challenged by
making an application under Section 34 of the Act of 1996 on the
grounds stated under Clause (a) and Clause (b) of sub-section (2) of
Section 34 of the Act of 1996. Sub-section (2-A) of Section 34
provides that an arbitral award arising out of arbitrations other than
international commercial arbitrations, may also be set aside by the
court if the court finds that the award is vitiated by patent illegality
appearing on the face of the award. The proviso to sub-section (2-A),
however, states that an award shall not be set aside merely on the
ground of an erroneous application of the law or by reappreciation of
evidence.
14. The Act of 2015 came into force on the 23 rd day of
October 2015. The purpose behind the enactment is to provide for the
constitution of Commercial Courts, Commercial Appellate Courts,
Commercial Division, and Commercial Appellate Division in the
High Court for adjudicating the commercial disputes of specific
value and for matters connected therewith or incidental thereto.
Clause (c) under Section 2 of the Act of 2015 defines “commercial
dispute”. The word “District Judge” is defined under Clause (e) of
Section 2. The District Judge has been defined in the following
terms:
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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“2. Definitions.- (e) “District Judge” shall have the
same meaning as assigned to it in clause (a) of article
236 of the Constitution of India;”
15. Section 3 of the Act of 2015 provides for the
constitution of Commercial Courts. We reproduce Section 3
hereunder for a ready reference:-
“3. Constitution of Commercial Courts.—(1) The State
Government, may after consultation with the concerned
High Court, by notification, constitute such number of
Commercial Courts at District level, as it may deem
necessary for the purpose of exercising the jurisdiction
and powers conferred on those Courts under this Act:
3
[Provided that with respect to the High Courts having
ordinary original civil jurisdiction, the State Government
may, after consultation with the concerned High Court,
by notification, constitute Commercial Courts at the
District Judge level:
Provided further that with respect to a territory over
which the High Courts have ordinary original civil
jurisdiction, the State Government may, by notification,
specify such pecuniary value which shall not be less than
three lakh rupees and not more than the pecuniary
jurisdiction exercisable by the District Courts, as it may
consider necessary.]
4
[(1-A) Notwithstanding anything contained in this Act,
the State Government may, after consultation with the
concerned High Court, by notification, specify such
pecuniary value which shall not be less than three lakh
rupees or such higher value, for whole or part of the
State, as it may consider necessary.]
3. Substituted by Act 28 of 2018, S. 6, for the proviso (w.r.e.f. 3-5-2018).
4. Inserted by Act 28 of 2018, S. 6 (w.r.e.f 3-5-2018).
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
12/28
(2) The State Government shall, after consultation
with the concerned High Court specify, by
notification, the local limits of the area to which
the jurisdiction of a Commercial Court shall
extend and may, from time to time, increase,
reduce or alter such limits.
1
(3) The [State Government may], with the
concurrence of the Chief Justice of the High Court
appoint one or more persons having experience in
dealing with commercial disputes to be the Judge
or Judges, of a 2[Commercial Court either at the
level of District Judge or a court below the level of
a District Judge]”
16. The jurisdiction of Commercial court is provided
under Section 6 which reads as under:-
“6. Jurisdiction of Commercial Court.—The
Commercial Court shall have jurisdiction to try all
suits and applications relating to a commercial
dispute of a Specified Value arising out of the entire
territory of the State over which it has been vested
territorial jurisdiction.
Explanation. - For the purposes of this section, a
commercial dispute shall be considered to arise out
of the entire territory of the State over which a
Commercial Court has been vested jurisdiction, if the
suit or application relating to such commercial
dispute has been instituted as per the provisions of
sections 16 to 20 of the Code of Civil Procedure,
1908 (5 of 1908).”
1. Substituted by Act 28 of 2018, S. 6 for “State Government shall” (w.r.e.f 3-5-2018).
2. Substituted by Act 28 of 2018, S. 6 for “Commercial Court, from amongst the cadre of Higher Judicial Service in
the State” (w.r.e.f 3-5-2018).
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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17. Section 10 of the Act of 2015 lays down the
provision relating to jurisdiction in respect of arbitration matters. It
would be appropriate to reproduce Section 10 hereinafter:-
10. Jurisdiction in respect of arbitration
matters.—Where the subject-matter of an
arbitration is a commercial dispute of a Specified
Value and––
(1) If such arbitration is an international
commercial arbitration, all applications or appeals
arising out of such arbitration under the provisions
of the Arbitration and Conciliation Act, 1996 (26
of 1996) that have been filed in a High Court, shall
be heard and disposed of by the Commercial
Division where such Commercial Division has
been constituted in such High Court.
(2) If such arbitration is other than an
international commercial arbitration, all
applications or appeals arising out of such
arbitration under the provisions of the Arbitration
and Conciliation Act, 1996 (26 of 1996) that have
been filed on the original side of the High Court,
shall be heard and disposed of by the Commercial
Division where such Commercial Division has
been constituted in such High Court.
(3) If such arbitration is other than an
international commercial arbitration, all
applications or appeals arising out of such
arbitration under the provisions of the Arbitration
and Conciliation Act, 1996 (26 of 1996) that
would ordinarily lie before any principal civil
court of original jurisdiction in a district (not being
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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a High Court) shall be filed in, and heard and
disposed of by the Commercial Court exercising
territorial jurisdiction over such arbitration where
such Commercial Court has been constituted.
18. On a bare reading of the aforementioned
provisions, it would appear that these special provisions have
been brought into existence in order to expedite the resolution of
commercial disputes at various levels. Where the subject matter
of an arbitration is a commercial dispute of a specific value and
such arbitration is other than an international commercial
arbitration, all applications or appeals arising out of such
arbitration under the provisions of the Act of 1996 that would
ordinarily lie before any principal civil court of original
jurisdiction in a district, (not being a High Court), shall be filed
in, and heard and disposed of by the Commercial Court
exercising territorial jurisdiction over such arbitration, where
such Commercial Court has been constituted. Sub-section (3) of
Section 10 very clearly talks of constitution of Commercial
Court and it clearly provides that in a district (not being a High
Court), all applications or appeals that would ordinarily lie
before any Principal Civil Court of Original Jurisdiction shall be
filed in and heard and disposed of by the Commercial Court.
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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19. It is a matter of record which finds discussion in
the judgment of this Court in the case of M/s Bihar State Road
Development Corporation (supra)that in the State of Bihar,
Commercial Court has been constituted. Previously, the
notification vide Memo No. 1150/J dated 03-03-2017 of the Law
Department published in the Bihar Gazette on 7 March, 2017
read as under:-
“fcgkj xtV
vlk/kkj.k vad
fcgkj ljdkj }kjk izdkf”kr
&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
16 QkYxqu 1938 ¼”k0½
¼la0 iVuk 189½ iVuk] eaxyokj] 7 ekpZ 2017
&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
fof/k foHkkx
&&&&&&
vf/klwpuk,a
3 ekpZ 2017
,l0 vks0 11] fnukad 7 ekpZ 2017& ‘The Commercial Courts, Commercial Division And
Commercial Appellate Division of High Courts Act, 2015’ (No.-4 of 2016) dh
/kkjk&3 }kjk iznRr “kfDr;ksa dk iz;ksx djrs gq,] fcgkj jkT; ljdkj] ,rn}kjk] iVuk mPp U;k;ky; ds
ijke”kZ ls] ,d djksM+ :i;s vFkok blls vf/kd ewY; ds okf.kfT;d fooknksa dh lquokbZ gsrq] jkT; ds lHkh
izeaMfy; eq[;ky;ksa esa fLFkr ftyk O;ogkj U;k;ky;ksa esa okf.kfT;d U;k;ky; (Commercial Courts)
xfBr djrh gS rFkk izeaMyh; eq[;ky; fLFkr O;ogkj U;k;ky; esa inLFkkfir ftyk U;k;k/kh”k (District
Judge) dks mDr izeaMy esa blds v/khu xfBr okf.kfT;d U;k;ky; dk U;k;k/kh”k fu;qDr djrh gS] tks
vius lkekU; dk;ksZa ds vfrfjDr bl U;k;ky; dk Hkh dk;Z djsaxs(
¼d½ bu U;k;ky;ksa dh LFkkuh; vf/kdkfjrk lacaf/kr izeaMy dh jktLo lhek,a gksxh]
¼[k½ ;g vf/klwpuk jkti= esa blds izdk”ku dh frfFk ls izo`r gksxhA
¼la0la0 ,0@,DV&10@2016&1150@ts0½
fcgkj&jkT;iky ds vkns”k ls
lqjsUnz izlkn “kekZ]
ljdkj ds lfpoA
,l0vks0 12] ,l0vks0 11] fnukad 7 ekpZ 2017 dk vaxzsth esa fuEufyf[kr vuqokn fcgkj&jkT;iky
ds izkf/kdkj ls blds }kjk izdkf”kr fd;k tkrk gS] tks Hkkjrh; lafo/kku ds vuqPNsn&348 ds [k.M ¼3½ ds
v/khu mldk izkf/kd`r ikB le>k tk;sxkA
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
16/28
¼la0la0 ,0@,DV&10@2016&1150@ts0½
fcgkj&jkT;iky ds vkns”k ls
lqjsUnz izlkn “kekZ]
ljdkj ds lfpoA
The 3rd March 2017
S.O. 11, dated the 7th March 2017- In exercise of the powers
conferred by section 3 of 'The Commercial Courts, Commercial Division
And Commercial Appellate Division of High Courts Act, 2015' (No.-4 of
2016), the State Government of Bihar, in consultation with the High Court
of Judicature at Patna, is hereby pleased to constitute the Commercial
Court in the District Civil Courts situated in all the Divisional Head
quarters of the State to hear cases of Commercial disputes of the value of
Rupees one crore or above and appoints the District Judge posted in the
Civil Court of the Divisional Headquarter as Judge of the Commercial
Court constituted hereunder in the concerned Division, who will discharge
the duties of this court in addition to his normal duties;
(a) The local jurisdiction of these courts shall be the revenue
limits of the concerned Division,
(b) This Notification shall come into force with effect from the
date of its publication in the official Gazette.
(F.No. A/Act-10/2016-1150/J)
By Order of the Governor of Bihar
Surendra Prasad Sharma,
Secretary to the Government.”
20. The notification dated 07th March, 2017 was,
however, superseded by the notification dated 02.08.2019. We
reproduce the notification dated 02.08.2019 hereunder:-
“fcgkj xtV
vlk/kkj.k vad
fcgkj ljdkj }kjk izdkf”kr
&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
11 Jko.k 1941 ¼”k0½
¼la0 iVuk 912½ iVuk] “kqØokj] 2 vxLr 2019
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
17/28
&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
fof/k foHkkx
&&&&&&
vf/klwpuk
2 vxLr 2019
,l0vks0 351] fnukad 2 vxLr 2019& fof/k foHkkx] fcgkj] iVuk ds vf/klwpuk la[;k 5080 fnukad 25-07-
2019 ¼fcgkj xtV la[;k 869 fnukad 25-07-2019 lgifBr ,l0vks0 347 fnukad 25-07-2019 }kjk
izdkf”kr½ ftlds }kjk jkT; esa okf.kfT;d U;k;ky;ksa ,oa okf.kfT;d vihyh; U;k;ky;ksa dk xBu fd;k
x;k gS] ds vaxzsth Hkk’kk ds izkf/kd`r ikB dks fuEufyf[kr }kjk izfrLFkkfir fd;k tkrk gS%&
NOTIFICATION
S. 0.351, dated 2nd August 2019-In exercise of the powers conferred by Section 3 of
The Commercial Courts, Commercial Appellate Courts, Commercial Divisions and Commercial
Appellate Divisions of High Courts Act, 2015 (No. 4 of 2016), the State Government of Bihar, in
consultation with the High Court of Judicature at Patna superseding the previously issued
notification memo no.-1150/J dated-03.03.17 of Law Department, Bihar, Patna on the subject, is
hereby pleased to:-
(a) constitute the Court of Civil Judge (Senior Division) of each district as a
Commercial Court to exercise original jurisdiction in respect of commercial disputes
where the value of the suit or dispute is not less than Rs. 3 Lacs and up to Rs.1 Crore;
(b) constitute the Court of District Judge in all the districts of the State of Bihar as a
Commercial Court to exercise original Jurisdiction in respect of commercial disputes
where the value of the suit or dispute exceeds Rs.1 Crore in respect of the entire
territorial area of the district; and
(c) designate the Court of District Judge in each district as Commercial Appellate
Court to exercise appellate jurisdiction and dispose of the appeals arising out of the
judgments and orders passed by a Commercial Court below the level of the District
Judge.
This notification shall come into force with effect from the date of its publication in the
official Gazette.
(File No.-A/act-10/2016/5250/J)
By Order of the Governor of Bihar,
MADAN KISHORE KAUSHIK,
Secretary to Government of Bihar.”
21. It is evident from the notification published on
02ndAugust, 2019 that the Court of Civil Judge (Senior Division)
of each district and the Court of District Judge in each district
has been designated as Commercial Court to exercise original
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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jurisdiction in respect of commercial disputes of the specific
value. This Court had occasion to consider Section 2 (1)(e) of
the Act of 2015 and Article 236 (a) of the Constitution of India
in the case of M/s Bihar State Road Transport Corporation
(supra). An identical argument was raised by learned counsel for
the respondent in the said case which has been taken note of by
this Court in paragraph ‘20’ of the judgment. This Court noticed
that under the provisions of the Act of 1887, that existed at the
relevant time, Section ‘3’ which deals with the constitution of
Civil Courts provided the classes of courts and Section ‘8’
provided that when the business pending before any District
Judge requires the aid of Additional Judges for its speedy
disposal, the State Government may, having consulted the High
Court, appoint such Additional Judges as may be requisite.
According to sub-section (2) of Section 8, Additional Judges so
appointed shall discharge all the functions of a District Judge,
which the District Judge may assign to them, and in the
discharging of those functions they shall exercise the same
powers as the District Judge.
22. We reproduce Sections 3 and 8 of the Act of 1887
hereunder:-
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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“3. Classes of Courts.—There shall be the
following classes of Civil Courts under this
Act, namely:—
(1) the Court of the District Judge;
(2) the Court of the Additional Judge;
(3) the Court of the 3[Civil Judge (Senior
Division]; and
(4) the Court of the 3[Civil Judge (Junior
Division].
8. Additional Judges.—(1) When the
business pending before any District Judge
requires the aid of Additional Judges for its
speedy disposal, the 2[State] Government may,
5
[having consulted] the High Court 4[***] (4.
The words “and with the previous sanction of
the G. G. in C.”rep. by Act 16 of 1911, s. 3),
appoint such Additional Judges as may be
requisite.
(2) Additional Judges so appointed shall
discharge any of the functions of a District
Judge which the District Judge may assign to
them, and, in the discharge of those functions,
they shall exercise the same powers as the
District Judge.”
23. In paragraphs ‘33’, ‘34’ and ‘35’ of the judgment in
the case of M/s Bihar State Road Transport
Corporation(supra), this Court has held as under:-
3. Subs by Bihar Amdt. Act, 2013 (Act No.14 of 2014) vide Bihar Gazettte (Ex. Ord.) No. 697, dt.
25.08.2014).
2.Subs. by the A.L.O.
5. Subs. by the A.L.O. for "upon the recommendation of."
4."And with the previous sanction of the Governor General in Council" rep. by Act 16 of 1911, S.3.
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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“33. A conjoint reading of Section ‘3’ and Section ‘8’
of the Act of 1887 would leave no room for doubt
that the Court of the District Judge and that of the
Court of the Additional Judge are two different
Courts. There is no iota of doubt that the Court of the
Additional Judges have been envisaged for the
speedy disposal of the cases pending before any
District Judge and once the same is assigned to an
Additional Judge by the District Judge, he would
discharge his duties in respect of the assigned matters
and while doing so, the learned Additional Judges
would carry on the functions of a District Judge, they
shall exercise the same power as the District Judge.
34. To this Court, it is evident that the Notification
dated 02.08.2019, constituting a Commercial Court
under Section 3 of the Act of 2015 has kept itself
confined to the Court of Civil Judge (Senior
Division) and to the Court of District Judge, in all
the Districts of the State of Bihar. The Notification
dated 02.08.2019 as framed cannot be construed in
the manner suggested by learned counsel for the
sole respondent.
35. The District Judge (now known as 'Principal
District Judge) of a District who has been
constituted as a Commercial Court within the
meaning of Act of 2015 does not derive any power
to further transfer its adjudicatory power as a
Commercial Court to the Additional Judges. This
was obviously not the position under the Kerala
Civil Court Rules.”
24. It is evident from the discussions made in the
judgment of this court in the case of M/s Bihar State Road
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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Transport Corporation (supra) that the contention of the
respondent that the Act of 2015 has adopted the meaning of the
word “District Judge” as occurring under Article 236(a) of the
Constitution of India and the definition of the word “District
Judge” as contained under Section 2(1)(e) of the Act of 2015 have
been duly considered by this Court but did not find favour with it.
25. We, therefore, find that the contention of Mr. YV
Giri, learned Senior Counsel, that the judgment of this court in the
case of M/s Bihar State Road Development Corporation Ltd.
(supra) is distinguishable, has no leg to stand.
26. Mr. Giri, learned Senior Counsel has relied upon the
judgment of the Hon'ble Supreme Court in the case of Santhosh
Maize & Industries Ltd. (supra). Paragraph ‘35’ of the judgment
has been referred to which reads as under:-
“35. Law is well settled that if in any statutory
rule or statutory notification two expressions are
used—one in general words and the other in
special terms—under the rules of interpretation, it
has to be understood that the special terms were
not meant to be included in the general
expression; alternatively, it can be said that where
a statute contains both a general provision as well
as a specific provision, the latter must prevail.”
27. On going through the judgment in case of Santhosh
Maize (supra), we find that the said matter relates to Tamil Nadu
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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General Sales Tax Act wherein a question arose as to whether the
appellant is entitled to exemption under Schedule III Part B Entry
8 by treating it as same as maize or taxable under Schedule I, Part
B, Entry 61 as a distinct product derived from maize. In the said
context, the observations were made in paragraph ‘35’. We are of
the considered opinion that the contention of Mr. YV Giri, learned
Senior Counsel, based on the observations of the Hon'ble Supreme
Court in paragraph ‘35’ of the judgment in case of Santhosh
Maize (supra) is completely misconceived and misplaced as the
same does not arise in this case. In the present case, it is crystal
clear that the application under Section 34 of the Act of 1996 is to
be heard and disposed of by a Commercial Court and such a
Commercial Court is to be constituted by virtue of Section 3 of the
Act of 2015. The notifications by which the Commercial Court has
been constituted talks of the “court of District Judge”. Therefore,
the meaning of this notification cannot be extended to mean and
understand that it covers the “courts of Additional District Judges”,
which is a distinct class of court.
28. We further find that the reliance placed on the
judgments in the case of Odisha State Financial Corporation
(supra), West Bengal Housing Infrastructure Development
Corporation (supra), Smt. Narmada Devi (supra) and Ishwar
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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Dutt (supra) are equally misconceived and misplaced as those
judgments are not dealing with identical issues. In the opinion of
this Court, these judgments would not be applicable in the facts of
the present case.
29. In the case of Odisha State Financial Corporation
(supra), the Hon'ble Supreme Court was considering a challenge to
the judgment of the High Court of Uttarakhand in Writ Petition
(M/S) No. 2314 of 2022, which was filed by the appellant under
Article 227 of the Constitution of India, challenging the civil
proceedings and orders passed by the courts below. One of the
contentions raised before the Hon'ble Supreme Court was that the
execution application filed by Respondent No. 1 was not
maintainable before the Civil Court in view of Section 15 (2) of
the Act of 2015. Under the said case, the Hon'ble Supreme Court
noticed that Respondent No. 1 had instituted a money suit for
recovery of dues from Respondent No. 2 on account of default in
payment for the supply of goods. Initially, the appellant was not a
party to the suit, but subsequently Respondent No. 1 impleaded the
appellant, a State Financial Corporation, which took action under
Section 29 of the SFC Act, 1951, against Respondent No.2. The
suit was decreed on 20.08.2001. Thereafter, Respondent No. 1
filed an application under Section 21 of the Limitation Act, 1963
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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before the trial court, pending appeal. The trial court allowed the
application, holding that the suit against the appellant was deemed
to be initiated from the original date of filing the suit. By a
subsequent order, it was held by the trial court that the suit was not
barred by limitation as against the appellant. The finding of the
Appellate Court and the High Court on limitation alone was
upheld by the Hon’ble Supreme Court. In this background, the
Hon’ble Supreme Court held that the decision of the Court was
confined only to the issue of limitation and remained silent on all
other material questions placed. The doctrine of ‘sub silentio’ has
been discussed in the said background. It refers to a situation,
where a rule or a principle on a particular point of law is applied or
passed upon by a Court silently, without any consideration of the
applicable law or without argument, and the judgment is rendered
on another question of law or fact. We once again come to a
conclusion that the judgment of the Hon'ble Supreme Court in the
case of Odisha State Financial Corporation (supra) has been
rendered in a completely different context and the same would
have no application in the matter before this Court.
30. Mr. Y.V. Giri, learned Senior Counsel has placed
reliance on an Hon’ble Larger Bench judgment of the Hon'ble
Calcutta High Court in the case of West Bengal Housing
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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Infrastructure Development Corporation (Supra). Perusal of the
said judgment would show that the short question which fell for
consideration before the Larger Bench was whether the court of
learned Additional District Judge is a court within the meaning of
Section 2(1)(e) of the Act of 1996. The provisions of the Act of
2015 did not come up for consideration before the Larger Bench of
the Hon'ble Calcutta High Court. We are afraid that the judgment
of the Hon'ble Calcutta High Court, by no means, may be cited to
submit that the court of Additional District Judge would be a
Commercial Court within the meaning of Section 3 of the Act of
2015 read with notification dated 02.08.2019.
31. Reliance placed on the judgment of a learned Single
Judge of this Court in case of Smt. Narmada Devi(supra) is
equally misconceived and misplaced. The said judgment was
rendered in the year 1999 when the Act of 2015 had not come into
existence, therefore, there is no discussion on the provision of the
Act of 2015.
32. Equally misconceived is the reliance placed on the
judgment of the Hon'ble Supreme Court in case of Ishwar Dutt
(supra). In the said case, the Hon'ble Supreme Court was
considering a challenge to the order passed by the High Court of
Himachal Pradesh dismissing claim of the appellant-claimant for
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
26/28
interest at the rate of 12% granted by an earlier order of the
Hon’ble Division Bench of the same High Court in CWP No. 510
of 1985 dated 09.09.1985 on equitable consideration for depriving
them of their lands without taking proceedings under the Land
Acquisition Act and for payment of compensation. The Hon’ble
Supreme Court found that there had been earlier round of litigation
in the matter of fixation of the compensation amount and the High
Court had awarded payment of interest only with effect from
07.05.1989 or with effect from the date of publication of the
notification under Section 4(1) of the Act and not from
18.12.1968. The Hon’ble Supreme Court found that the award of
the Land Acquisition Officer directing payment of additional
interest had attained finality. In that context, it was held that the
reference court or for that matter, the High Court exercising its
appellate jurisdiction under Section 54 of the Act could not have
dealt with the said question. The principle of res judicata is a
species of the principle of estoppel and when a proceeding based
on a particular cause of action has attained finality, the principle of
res judicata shall fully apply.
33. This Court finds that the question relating to
jurisdiction of the Additional District Judge-XXVI, Patna to deal
with the present case under Section 34 of the Act of 1996 as a
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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Commercial Court was raised before the learned Additional
District Judge Patna, the Division Bench judgments of this Court
were brought to the notice of the learned Presiding Officer who
took note of those judgments but then went on to take a view that
in the case of South Bihar Power Distribution Company
Limited (supra) or M/s Vishal Builtech India Pvt. Ltd (supra),
the definition of “District Judge” as given in Section 2(e) of the
Act of 2015 read with Article 236(a) of the Constitution of India
could not be brought to the notice of this Court. It is evident that
the learned Additional District Judge-XXVI, Patna rejected the
plea of the appellant as regards his jurisdiction and proceeded to
decide the matter taking upon himself the jurisdiction of the
Commercial Court by ignoring the judgments of the High Court.
In such circumstances, plea of res judicata cannot succeed. The
learned Additional District Judge-XXVI, Patna, was bound by the
judgment of the Hon'ble High Court in the case of South Bihar
Power Distribution Company(supra) and M/s Vishal (supra) but
by committing an act of judicial indiscipline, the Presiding Officer
did not abide by the judgment of this Court.
34. In result, we find no merit in the contentions
advanced on behalf of the respondent. The impugned order dated
13.10.2023 passed by the learned Additional District Judge-XXVI,
Patna High Court COMMERCIAL APP No.4 of 2025 dt.18-06-2026
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Patna, in Miscellaneous (Arbitration) Case No. 37 of 2018 is
hereby set aside.
35. The records of the Miscellaneous Arbitration Case
are transferred to the court of Principal District Judge, Patna, who
is the Commercial Court constituted under the Act of 2015. The
learned Commercial Court, Patna, shall consider the
Miscellaneous Arbitration Case on its own merit after giving
appropriate opportunity of hearing to the parties.
36. We have confined our consideration to the limited
issue of jurisdiction and have not gone into the other grounds.
Thus, all other contentions are left open to the parties.
37. This appeal is allowed to the extent indicated
hereinabove.
(Rajeev Ranjan Prasad, J)
(Kumar Manish, J)
lekhi/-
AFR/NAFR AFR
CAV DATE 16.06.2026
Uploading Date 19.06.2026
Transmission Date
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