Bombay HC Upholds Rs 24 Crore Lawsuit, Denies Quashing Request
Film producer Firoz A. Nadiadwala is facing a significant legal challenge as the Bombay High Court has ruled against his plea to dismiss a commercial claim of Rs 24 crores. The court’s decision comes after Nadiadwala argued that he had not been formally served with summons regarding the lawsuit. However, the court found that his active participation in the proceedings negated this argument, allowing the case to move forward.
Background of the Dispute
The legal battle stems from a financing agreement made on July 16, 2015, between businessman Anil Dhanraj Jethani and Nadiadwala for an unnamed film. Jethani filed a lawsuit on August 19, 2015, seeking to recover Rs 24 crores, claiming that he had not received the payments owed to him. A consent order was issued on September 1, 2015, which permitted Jethani to withdraw Rs 12.5 crores that had been deposited by another defendant. The remaining balance was to be settled by Nadiadwala before the release of his film “Welcome to the Jungle,” which has since been postponed from its original release date of December 28, 2024.
Following the implementation of the Commercial Courts Act in October 2015, the case was re-registered as a commercial suit, indicating its significance in the realm of business disputes within the film industry.
Nadiadwala’s Legal Arguments
In his attempt to have the suit dismissed, Nadiadwala raised several objections. He contended that no writ of summons had been served, rendering all subsequent orders, including the 2015 consent order, void under the Civil Procedure Code (CPC). He also pointed out that there had been no action taken for over seven years to issue fresh summons, which he argued further invalidated the case. Additionally, Nadiadwala claimed that the financing agreement lacked a signature from one party, which he believed cast doubt on its enforceability.
These arguments were central to Nadiadwala’s defense as he sought to extricate himself from the financial obligations outlined in the lawsuit.
Court’s Ruling and Implications
Justice Abhay Ahuja, presiding over the case, dismissed Nadiadwala’s objections, emphasizing that the CPC allows for the waiver of formal service if the defendant has already engaged with the court through legal counsel. The judge noted that Nadiadwala’s previous participation in hearings demonstrated his awareness of the ongoing litigation, fulfilling the legal requirement that a defendant must be informed of the case against them.
As a result of the court’s ruling, the suit will proceed in the commercial court, with both parties instructed to cooperate to ensure a timely trial. The ongoing litigation may pose challenges for Nadiadwala, particularly concerning the financing and distribution of the third installment in his popular “Welcome” franchise. The film, which boasts a star-studded cast, has yet to secure a new release date amidst these legal complications.
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