Pre-Institution Mediation (Section 12A): What It Means Before You Sue: An Illustrative Scenario

To make the general position concrete, here is an illustrative, hypothetical situation (not a real case) that raises this question.

The illustrative scenario

The question

The natural question that follows is:

How the general rule applies

Section 12A of the Commercial Courts Act makes pre-institution mediation mandatory for commercial disputes of specified value ₹3 lakh or more, except where a party seeks urgent interim relief.

The Supreme Court's decision in Patil Automation (17 Aug 2022) first made this mandatory rather than optional, and Dhanbad Fuels v Union of India (15 May 2025) confirmed that suits filed on or after 20 Aug 2022 without it must be rejected under Order VII Rule 11 CPC.

If the claim is ₹3 lakh or more and qualifies as a commercial dispute, yes, under s.12A of the Commercial Courts Act, unless you are seeking urgent interim relief. Courts have rejected suits filed without this step.

What often gets missed in situations like this

• Treating s.12A mediation as a formality that can be skipped if both sides expect it to fail — courts have rejected suits filed without it outright.
• Not documenting the mediation attempt properly, which can create a dispute over whether the requirement was satisfied.

As noted above, this scenario is a constructed illustration used to explain the general rule — it does not describe a real client, case, or outcome.

For the general rules, see Pre-Institution Mediation (Section 12A): What It Means Before You Sue and Recovering Money Owed to You: The Limitation Period and Your Options.

If this touches a situation you are dealing with, you are welcome to discuss it in a consultation.

The content above explains how the law generally works; it is not legal advice and should not be treated as a substitute for advice on your particular facts.