By S&S Co. Advocates & Solicitors · Published 16 July 2026 · Informational content, not legal advice: see our disclaimer
When a Civil Suit Is the Right Route
For unpaid commercial dues arising from a supply, service or contractual arrangement, a civil recovery suit remains the standard route where the amount is disputed or where alternative remedies, such as a cheque-bounce complaint under Section 138 of the Negotiable Instruments Act, or the summary procedure available to MSME suppliers under the MSMED Act, are unavailable or inapplicable.
Where the Suit Is Filed
Commercial suits above the specified pecuniary threshold are filed before the designated Commercial Court or Commercial Division, which apply the Commercial Courts Act, 2015's procedural framework, including mandatory pre-institution mediation under Section 12A where no urgent interim relief is sought, and the more structured case-management timelines the Act builds on top of the ordinary CPC.
Pre-Suit Steps
Before filing, a creditor should send a clear written demand notice setting out the amount claimed, the basis for it, and a reasonable deadline for payment: this record is useful evidence of the debtor's default and can also support a claim for interest from the date of demand. Where pre-institution mediation under Section 12A applies, this step is not merely advisable but mandatory, and failing to complete it can result in the plaint being rejected.
Proving the Claim
A recovery suit for commercial dues is generally proved through the underlying contract or purchase order, invoices, delivery records, and, for a running account, periodic account statements and any signed acknowledgments of the outstanding balance, which can also be important for limitation purposes. Order XIII-A summary judgment can be a faster route to a decree where the debtor has no real defence and the documentary trail is clean.
After the Decree, Execution
Obtaining a money decree is often only half the battle, actual recovery requires execution under Order XXI CPC, which can include attachment of the debtor's movable or immovable property, garnishee proceedings against third parties who owe money to the debtor, and, in appropriate cases, arrest and detention in execution for a debtor who has the means to pay but refuses to do so.
Frequently Asked Questions
Is pre-institution mediation mandatory before filing a recovery suit for commercial dues?
Yes, unless the suit contemplates genuine urgent interim relief: a suit filed without completing Section 12A mediation, where it applies, risks rejection of the plaint.
How can a creditor speed up recovery where the debtor has no real defence?
By seeking summary judgment under Order XIII-A CPC, which allows a decree without a full trial where the defendant has no real prospect of successfully defending the claim.
What if the debtor has no seizable assets in India?
Recovery becomes considerably harder: creditors should assess a debtor's asset position, including through pre-suit diligence, before investing significantly in litigation.
Does obtaining a decree guarantee actual payment?
No: a decree only establishes the legal entitlement to payment; execution proceedings under Order XXI CPC are frequently a separate, sometimes lengthy, process to actually realise the amount.
References & Further Reading
This article references the following statutory provisions. Readers should always verify current rules, fees and timelines against the applicable statute and rules as amended, since these are revised from time to time.
- The Commercial Courts Act, 2015, including Section 12A (pre-institution mediation) and Order XIII-A CPC as applicable to commercial disputes.
- The Code of Civil Procedure, 1908, Order XXI (Execution of decrees and orders).