Madras High Court upholds that a settlement memo filed before trial leads to dismissal as settled and entitlement to refund of court fees under the Commercial Courts Act, affirming existing procedure for commercial disputes.
Summary
| Category | Data |
|---|---|
| Case Name | C.S(COMM DIV)/190/2025 of M/s V2 Constructions Vs Rajeshuwari and 2 others |
| CNR | HCMA011431862025 |
| Date of Registration | 25-07-2025 |
| Decision Date | 18-08-2025 |
| Disposal Nature | DISMISSED AS SETTLED OUT OF COURT |
| Judgment Author | Honourable Mr. Justice Senthilkumar Ramamoorthy |
| Court | Madras High Court |
| Bench | Single Judge |
| Type of Law | Civil Procedure / Commercial Courts Act |
| Questions of Law | Whether a pre-trial out-of-court settlement warrants dismissal of a commercial suit with refund of court fees |
| Ratio Decidendi |
The suit was settled out of Court via a memo dated 28.07.2025. Consequently, C.S.(Comm.Div.) No.190 of 2025 is dismissed as settled out of Court. Since such settlement was arrived at pre-trial stage, the plaintiffs shall be entitled to refund of Court fees. |
| Statutory Provisions Invoked |
|
What’s New / What Lawyers Should Note
- A settlement memo filed before the trial stage in a commercial suit leads to automatic dismissal of the suit as settled.
- Plaintiffs in commercial disputes are entitled to a refund of court fees when settlement occurs pre-trial.
- This judgment can be cited to secure fee refunds in suits under the Commercial Courts Act once a pre-trial settlement is recorded.
Summary of Legal Reasoning
- The plaintiffs submitted a memo dated 28.07.2025 indicating that the suit had been settled out of Court.
- The Court noted that the settlement occurred before the commencement of trial.
- In view of the pre-trial settlement, the Court dismissed C.S.(Comm.Div.) No.190 of 2025 as settled out of Court.
- The Court held that, because the settlement took place at the pre-trial stage, the plaintiffs are entitled to a refund of the court fees paid.
Arguments by the Parties
Petitioners (Plaintiffs)
- The suit has been amicably settled out of Court by way of a memo dated 28.07.2025.
Factual Background
- The plaintiffs filed C.S.(Comm.Div.) No.190 of 2025 under Order IV Rule 1, Order VII Rule 1 CPC and Section 2(1)(C)(vi) & (xi) of the Commercial Courts Act, 2015, seeking monetary relief and costs.
- On 28.07.2025, the plaintiffs submitted a memo stating that the suit had been settled out of Court.
- On 18.08.2025, the Madras High Court dismissed the suit as settled and ordered refund of court fees since settlement occurred pre-trial.
Statutory Analysis
- Order IV Rule 1, O.S.Rules 1956: Procedure for settlement and its effect on pending suits.
- Order VII Rule 1, Civil Procedure Code, 1908: Plaint’s requirements and effect of compromise.
- Section 2(1)(C)(vi) & (xi), Commercial Courts Act, 2015: Definition and scope of commercial suits and ancillary reliefs.