Sued in a Commercial Court? Your Defence Strategy

The first 48 hours after commercial court summons arrive

Start with the date of service. Every deadline in a commercial suit runs from that day, and the court will check it against the process server's report. If someone at your office took the papers, find out exactly when. Don't guess. If the summons came by email or WhatsApp, take a screenshot with the date showing.

Next, work out what kind of suit it is. Look at the heading of the summons and the plaint. Does it mention Order XXXVII or say summary suit? Then you have 10 days from service to enter appearance, and later another 10 days from the summons for judgment to ask for leave to defend. Read our page on leave to defend a summary suit today, not next week. If it's an ordinary commercial suit, the written statement is due in 30 days. The court can stretch that, but only up to 120 days from service. After that, it's gone.

Last, see whether any interim application has been filed against you. It could be an injunction, attachment before judgment, a deposit, or a direction to disclose your assets. These often come up on the very first date. An order passed while you're absent can hurt the business long before anyone looks at the merits.

Your deadlines as a defendant, and what each stage costs

These are the main time limits the law sets in a commercial suit, with the costs you'd usually expect at each stage. Lawyer's fees aren't included. Those are agreed separately.

Should this suit even be in a commercial court? Look for the weak points

Before you get into who's right, ask whether the suit is properly in front of this court at all. A fair number of commercial suits have a threshold defect. Raise it early and it can finish the case, or send it somewhere better for you.

Is it a commercial dispute at all? Section 2(1)(c) of the Commercial Courts Act, 2015 lists what qualifies: ordinary trade between merchants, supply and service contracts, construction, distribution and franchising, partnership and shareholder agreements, IP, insurance, leases of property used only for trade, and a few more. A homeowner fighting a contractor over the family house may well fall outside it.

Is the specified value Rs 3 lakh or more? If it's less, the suit belongs in an ordinary civil court. Section 12 says how value is worked out, and a figure that's been blown up or played down can be challenged. Value also decides whether a Delhi district commercial court or the Delhi High Court hears it.

Did the plaintiff go to Section 12A mediation first? For suits filed from 20 August 2022 onwards, Patil Automation v. Rakheja Engineers (2022) made pre-institution mediation compulsory, unless the plaintiff genuinely needs urgent interim relief. Skip it, and the plaint is liable to be rejected under Order VII Rule 11 CPC. And if an injunction prayer was tacked on only to dodge mediation, Yamini Manohar v. T.K.D. Keerthi (2023) lets the court see through it.

Is the claim within time? Under the Limitation Act, 1963 most money claims have to be filed within three years of the payment due date or the breach. Plaintiffs often lean on an acknowledgment or a part payment to restart the clock under Sections 18 and 19. Check those dates yourself. Quite often they don't add up.

The rules a commercial defence has to work within

Your written statement is the defence. Treat it that way.

The written statement is your whole defence in writing. In a commercial suit it carries far more weight than in an ordinary civil case. Since evasive denials are read as admissions, you can't skip a single paragraph of the plaint. The old line, "the contents of para 7 are denied for want of knowledge", isn't safe any more where the facts are plainly within your knowledge.

When Advocate B.K. Singh drafts a defence to a recovery suit, he doesn't start with the plaint. He starts with the plaintiff's ledger. The plaint is the story the plaintiff wants told. The ledger shows what was really invoiced, credited, returned and paid. In supply disputes, most genuine defences turn up in the gaps: a debit note that doesn't match, a credit note for rejected goods that never got booked, an advance nobody adjusted, a GST input reversal.

Every legal objection belongs in the written statement too. Jurisdiction. Valuation, limitation, Section 12A, arbitration, misjoinder of parties, and whether the person who signed the plaint had authority to. Objections you don't take at the start are often treated as given up. For the detailed rules on timing, and what happens if you're late, see our page on the 120-day written statement deadline.

Counter-claim and set-off: getting your own money back in the same case

If the plaintiff owes you money or caused you a loss, you don't need a separate suit. Bring a counter-claim under Order VIII Rule 6A CPC in this one. The court treats it as a cross-suit. It needs its own court fee and its own statement of truth, and it's decided along with the main suit. File it with the written statement in the normal course. A late counter-claim can be refused.

Set-off under Order VIII Rule 6 is narrower. It covers an ascertained sum the plaintiff legally owes you, like an agreed rebate or a debit note nobody disputes. Equitable set-off comes out of the same transaction and is more flexible. You see it all the time in supply and construction cases, where the buyer says the goods were defective or the work ran late.

Advocate B.K. Singh usually tells clients to bring a counter-claim only if they'd have sued on it anyway. One added just for weight costs court fee. You'll still have to prove it. If it fails, you may pay costs. A real counter-claim is different. It changes the settlement maths, because now the plaintiff could end up with a decree against itself.

Limitation still applies. A claim that was time-barred as a separate suit doesn't come back to life because you've called it a counter-claim.

Got an arbitration clause? Raise it before anything else

If the contract you're being sued on has an arbitration clause, you can ask the court to send the dispute to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996. The application has to go in no later than your first statement on the substance of the dispute, with the original arbitration agreement or a certified copy attached.

Timing decides this. File a written statement on the merits first and you'll probably be held to have given up arbitration. So where there's a clause, the Section 8 application goes in before the written statement or with it, and any written statement you do file says in terms that it's without prejudice to that application. The arbitration side, including getting an arbitrator appointed, is covered on our network's arbitration practice site.

Arbitration isn't automatically better for a defendant. It can be quicker. But you pay the arbitrator, and an award is hard to set aside. If you've got a strong limitation or valuation point in court, you might be better off staying there. It's a judgement call. Make it in the first week, not when the 120 days are nearly over.

How we put a commercial defence together

1. Lock down the dates

   We record the date of service, the next hearing, and the last day for the written statement or leave to defend. The 30-day and 120-day dates go in the diary. If the first hearing comes before you're ready, appear and ask for time. Don't stay away.

2. Read the plaint and every document with it

   A commercial plaint has to come with all its documents. We read them for what isn't there: purchase orders nobody signed, ledger entries with no invoice behind them, email threads that stop halfway. Anything not served on you, we ask for.

3. Test the thresholds and objections

   Is it a commercial dispute? What's the specified value? Then Section 12A, limitation, jurisdiction and arbitration. We decide whether to move for rejection of the plaint or file a Section 8 application, and when.

4. Collect your documents

   Your ledger, letters and emails, quality complaints, debit notes, delivery records, payments. Under Order XI everything relevant goes in with the written statement. That includes the papers that hurt you.

5. Draft the written statement and any counter-claim

   We answer each paragraph of the plaint specifically, set out your version and take every objection. Then come the counter-claim, if there is one, verification by statement of truth, and the documents affidavit.

6. Fight the interim applications

   Any injunction, attachment or deposit application gets a reply on your own affidavit, with documents. Sometimes offering limited security heads off a much harsher order.

7. Inspection, then admission and denial

   You inspect the plaintiff's documents within 30 days. Your admission and denial affidavit follows within 15 days of inspection, with a reason for every denial.

8. Case management and trial

   At the case management hearing the court frames issues and fixes a timetable for evidence and arguments. Witnesses usually give evidence by affidavit and are then cross-examined, quite often before a local commissioner rather than the judge.

Papers to pull together for your defence

Which court has the case, and can you object to it?

In Delhi, commercial suits up to Rs 2 crore go before the District Judge (Commercial Court) in the district complexes: Saket, Patiala House, Tis Hazari, Karkardooma, Rohini, Dwarka and Rouse Avenue. Anything above Rs 2 crore goes to the Commercial Division of the Delhi High Court. There's been a proposal since late 2025 to raise the district court limit, so check what the limit is today. In Ghaziabad, Gautam Buddh Nagar, Gurugram and Faridabad, it's whichever court has been designated the Commercial Court for that district.

Territorial jurisdiction is governed by Section 20 CPC. You can be sued where you live or carry on business, or where the cause of action arose. Some plaintiffs file in their home city on a flimsy link, say an email that was opened there. If your contract has an exclusive jurisdiction clause naming some other city, that's a strong objection. Our page on which commercial court hears a case walks through the value and territory tests.

Raise any territorial or pecuniary objection at the first chance you get. Usually that's the written statement, or a separate application. If the court agrees, it returns the plaint for filing in the right court, which can cost the plaintiff time and occasionally limitation. Transfer from one court to another under Section 24 CPC is possible. Courts grant it only for good reason, though.

Interim applications against you: injunctions, attachment, deposits

Plenty of plaintiffs try to win the case at the interim stage. A supplier asks for an order that you deposit the amount claimed. A brand owner wants an injunction against your product. A creditor applies for attachment of your assets before judgment. Each has its own test. Each can be opposed.

Your reply goes on affidavit, with documents, and it should meet the actual allegations. Say the plaintiff claims you're selling off assets. Show the sale was in the ordinary course of business, or the property's mortgaged anyway, or the business is running as usual. If it's a money claim and you have a genuine dispute, the dispute should show up in your own documents. Your word alone won't carry it.

In money suits, courts now often ask defendants to disclose their assets on affidavit, following Rahul S. Shah v. Jinendra Kumar Gandhi (Supreme Court, 2021). Answer fully and honestly. Hiding assets in a court affidavit is far more dangerous than the suit you started with. And where the court seems inclined to protect the plaintiff, offering limited security (a bank guarantee for part of the claim, for instance) can head off a sweeping attachment that would choke the business.

Summary judgment, disclosure and the case management hearing

The amended CPC gives a commercial plaintiff a quick way to finish off a weak defence. Under Order XIIIA, once summons is served and before issues are framed, the plaintiff can apply for summary judgment. You get notice and can reply, usually within 30 days. If your defence rests on a story your own documents don't back, the court may decide the suit with no trial at all. It cuts both ways. A defendant can use Order XIIIA too, where the claim is plainly hopeless, say obviously time-barred.

Disclosure is two-way as well. Under Order XI you can inspect the plaintiff's documents and ask for anything it's held back; see document disclosure and inspection. Your admission and denial affidavit has to give a reason for each denial. Deny the plaintiff's invoice when it's sitting in your own books, and expect costs.

Under Order XV-A, the case management hearing is where the court frames issues and sets the timetable for evidence and arguments. Parties are expected to stick to it, and repeated adjournments cost money. Defendants who plan to wear the plaintiff down by delay usually find commercial courts far less patient than ordinary civil courts. That's been our experience, anyway.

Your risk depends on who you are: buyers, service firms, startups, guarantors, large companies

Buyers sued by MSME suppliers have an extra problem. If the supplier is a registered micro or small enterprise, Sections 15 to 17 of the MSMED Act, 2006 require payment within the agreed period, and never later than 45 days from acceptance. Delay attracts compound interest at three times the RBI bank rate. The supplier may have gone to the MSME Facilitation Council under Section 18 instead of filing a suit. In a suit, the interest claimed can overtake the principal within a few years. So look hard at the supplier's registration date, the acceptance date and any quality rejection.

Service firms and IT companies usually get sued for non-delivery or bad work, or they sue for their fees and find a damages claim coming straight back at them. What decides it is the scope of work, the change requests and who signed off what. Emails beat the contract here.

Startups often get sued by vendors or landlords during a cash crunch. A defence that admits part of the claim, disputes the rest and comes with a realistic payment plan frequently ends better than a flat denial that falls apart at summary judgment. Guarantors and directors are personally liable only if they signed a guarantee or are personally bound some other way. Being a director doesn't, by itself, make you liable for the company's debts.

Large companies are usually defending on paperwork created by dozens of people. The danger is contradicting yourself. Procurement accepted a rate by email, and now legal wants to dispute it. Gather documents from every department early and the disclosure stage won't spring surprises. If the plaintiff is also threatening insolvency proceedings over an operational debt, that defence works differently. It's covered on our network's NCLT and IBC practice site.

Sometimes settling is the smarter defence

Not every suit is worth fighting to judgment. Where most of the debt is admitted, the real fight is over interest and costs, and settling early can save you both. Under Section 35 CPC as amended, courts look at whether a party refused a reasonable settlement offer when they award costs.

You can settle at any stage. Through the court's mediation centre, at a Lok Adalat, or by a compromise recorded under Order XXIII Rule 3 CPC. A recorded compromise binds both sides and can be enforced like a decree; our page on settling a commercial suit midway explains how. A settlement reached in Section 12A mediation has the status of an arbitral award.

Ignoring the suit is the worst thing you can do. If an ex parte decree is passed, you can apply under Order IX Rule 13 CPC to set it aside, but you'd have to show summons wasn't duly served, or that sufficient cause kept you from appearing. See setting aside an ex parte decree. That's harder, and costs more, than defending on time. Lose after trial? An appeal lies within 60 days under Section 13 of the Commercial Courts Act, and our page on appeals in commercial matters covers it.

Where defendants in commercial suits go wrong

• Treating 120 days as the deadline. It isn't. The deadline is 30 days, and anything beyond is at the court's discretion, with costs. Plan for 30.
• Filing a defence before the Section 8 application. Do that and you may have waived arbitration.
• Denying everything in one line. In a commercial suit, a bare denial with no reasons is treated as an admission.
• Keeping an awkward document back. You may then be barred from relying on your own papers, and the judge will trust you less.
• Ignoring the Section 12A notice. Skipping mediation can count against you on costs later. You've also thrown away a cheap chance to settle.
• Not turning up on the first date. That's when interim orders get made and service is recorded. Stay away and you're inviting an ex parte order.

This week's to-do list

• Write down the exact date you were served, then work out your 30-day and 120-day dates.
• Is it a summary suit? If yes, the 10-day clock is already running. Act today.
• Dig out the contract and read the arbitration clause and the jurisdiction clause.
• Pull up your ledger of the plaintiff and check it line by line against the plaint's figures.
• Collect every email, complaint and debit note about the goods or work in dispute.
• Tell your staff not to delete any chats or emails with the plaintiff.
• Be there on the first date, yourself or through counsel, even if the papers aren't ready.

Planning the defence early

Most commercial defences take their shape in the first 30 days. Which objections go in, whether arbitration is invoked, which documents get filed, and how closely the plaint is answered. Advocate Sadhna Singh usually takes the first look at the summons and the plaint. She fixes the deadlines and asks for your ledger and correspondence, so the defence rests on your own records and not on the plaintiff's version of events.

We discuss fees at the first meeting and agree them in writing, stage by stage. Court fee on any counter-claim, and other costs, are separate.

Want the summons, the plaint and your ledger looked at before the first date? Or want to know how commercial courts are applying these deadlines right now? Send them to Advocate B.K. Singh's team through our contact page.