Facts
This case centers on a dispute over a real estate development project in Mumbai involving multiple parties, including developers, individuals, and housing societies. The story begins with a development agreement signed on May 7, 1995, between the Gorai Road Ashtavinayak Nagar Co-op. Hsg. Societies Union Ltd., a federation of housing societies, and Sailee Developers Pvt. Ltd. The agreement was for redeveloping a property, where Sailee Developers was supposed to provide new flats to the existing members of the societies and use the remaining development potential for its own profit.
On June 24, 1997, a few more societies joined the federation, making their members entitled to flats under the agreement. Years later, on June 29, 2006, Segment Developers Pvt. Ltd., along with Sailee Developers and others, formed a partnership firm called Image Developer to handle the development rights of this property. Then, on March 15, 2010, a deed of assignment was executed, transferring these rights from Image Developer and Segment Developers to Kamla Landmarc Real Estate Holding Private Limited and four individuals: Jitendra Ramesh Jain, Jinendra Ramesh Jain, Dilipkumar Jain, and Vikaskumar C. Jain. The deal was for Rs. 44.87 crores, payable in installments, along with other obligations like allotting flats to society members.
Everything seemed fine until December 5, 2023, when Kamla Landmarc and the four individuals assigned their rights over the property to Moral Mercantile LLP without fully meeting obligations under the 2010 assignment, such as paying the full amount or allotting flats. The plaintiffs, Image Developer and Segment Developers, say they first learned about this new assignment in January 2024 when they visited the site and saw Moral Mercantile’s name displayed. They then obtained a copy of the 2023 agreement from the sub-registrar’s office.
Claiming breach, the plaintiffs sent a termination notice on January 19, 2024, to Kamla Landmarc and the individuals, ending the 2010 assignment for non-payment and failure to allot flats. The recipients replied on March 1, 2024, disputing the termination. Concerned about third-party rights, the plaintiffs sent notices on October 21, 2024, under the Maharashtra Co-operative Societies Act and the Maharashtra Housing and Area Development Act to the federation and the Maharashtra Housing & Area Development Authority, asking them not to grant permissions for development by other parties.
The plaintiffs claim the defendants owe them Rs. 7.21 crores plus interest, totaling over Rs. 28 crores as of October 2024. They argue the 2023 assignment is illegal and void for violating the 2010 deal, and Moral Mercantile knew about the breaches. They also allege the defendants are attempting to raise finance or assign rights further, which could worsen matters.
On the other hand, Kamla Landmarc and the two Jains argue the suit is invalid because the plaintiffs skipped the mandatory pre-suit mediation process and that it is time-barred since the last payment was due in 2017. They contend there was no urgency to justify bypassing mediation, pointing to the delays in action.
Procedural Details
The main suit was filed on November 30, 2024, in the Bombay High Court’s commercial division as it involves a commercial dispute over development rights and agreements. Along with the suit, the plaintiffs filed an interim application seeking temporary relief to prevent the defendants from dealing with the property or creating third-party rights.
In response, Kamla Landmarc Real Estate Holding Private Limited, Jitendra Ramesh Jain, and Jinendra Ramesh Jain filed an interim application asking the court to reject the plaint under civil procedure rules, arguing violation of pre-suit mediation requirements and limitation issues.
The plaintiffs claimed urgency due to possible third-party rights, while the defendants said no urgency existed given the long delays. The matter was heard via video conferencing. The judge reserved the order on September 16, 2025, and pronounced it on September 19, 2025. This was only on the preliminary application to reject the suit, not on the merits or limitation.
Dispute
The core issue was whether the suit could proceed at all. The defendants argued it should be dismissed because the plaintiffs skipped mandatory pre-institution mediation under the Commercial Courts Act. This law requires mediation before filing unless urgent temporary relief is needed.
The plaintiffs argued their case fit the exception due to the risk of third-party rights. The defendants countered that the 10-month delay from January 2024 to November 2024, and lack of urgency after filing, proved otherwise. They said the plaintiffs’ urgency claims were unsubstantiated. Limitation was raised too but not decided since the court rejected the suit on mediation grounds.
Detailed Reasoning
The judge explained the purpose of Section 12A of the Commercial Courts Act, 2015, which mandates pre-suit mediation unless urgent interim relief is genuinely required. Mediation is time-bound and does not affect limitation periods, promoting quicker resolution and preserving business relations.
The judge emphasized urgency must be based on solid facts, not bare assertions. Examining the plaint, the judge found the plaintiffs’ claims of urgency vague and unsupported. The 10-month delay and lack of ex-parte relief after filing undermined their argument. Their reliance on continuous breach under the Transfer of Property Act was irrelevant for skipping mediation.
Citing Patil Automation Pvt. Ltd. vs. Rakheja Engineers Pvt. Ltd. (2022), the Supreme Court held Section 12A is mandatory, and suits without mediation must be rejected unless urgency is genuine. In Yamini Manohar vs. T.K.D. Keerthi (2024), urgency was defined as relief that cannot wait without causing irreparable harm. The Delhi High Court in Exclusive Capital Ltd. vs. Clover Media Pvt. Ltd. (2025) stressed urgency requires specific facts, not general claims. Other supporting judgments were also cited.
The judge found the plaintiffs’ urgency claims baseless and their conduct inconsistent with urgency. Thus, mediation was mandatory and not excused.
Decision
The court allowed the defendants’ application and rejected the plaint under Order VII Rule 11(d) of the Code of Civil Procedure, 1908, due to non-compliance with Section 12A of the Commercial Courts Act, 2015, and failure to prove genuine urgency. The main suit and interim application were disposed of without ruling on merits or limitation. The plaintiffs may file a fresh suit after mediation.
Case Details
- Case Title: Image Developer and Another vs. Kamla Landmarc Real Estate Holding Private Limited and Others
- Order Date: September 19, 2025
- Case Number: Commercial Suit (L) No.39332 of 2024
- Neutral Citation: 2025:BHC-OS:15574
- Name of Court: High Court of Judicature at Bombay
- Name of Hon’ble Judge: Jitendra Jain, J.
Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.
Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi
