A Full Bench of the Andhra Pradesh High Court has ruled that no separate government notification is required to reduce the jurisdictional threshold for commercial disputes to ₹3 lakh. In a common order delivered on May 18, 2026, the bench comprising Justice Cheekati Manavendranath Roy, Justice Ravi Nath Tilhari, and Justice Battu Devanand confirmed that the 2018 amendment to the Commercial Courts Act, 2015, became operative by its own force on May 3, 2018. This decision clarifies that the lowered “Specified Value” is active without needing executive intervention from either the Central or State Government.
The ruling resolves persistent legal uncertainty regarding how the 2018 amendment—which slashed the threshold from ₹1 crore to ₹3 lakh—should be implemented. The court noted that because the amendment became operative by its own force on May 3, 2018, the reduction in value did not depend on further official gazette notifications. This standard of threshold is designated to improve the “Ease of Doing Business” by bringing more business litigation under specialized judicial oversight.
By establishing this standard, the court has effectively excluded the jurisdiction of ordinary Civil Courts for commercial matters meeting the ₹3 lakh criterion. The ruling aligns with similar procedural rigor seen in other jurisdictions, such as when the Telangana High Court clarified the 120-day limit for filing written statements. All commercial disputes exceeding ₹3 lakh currently pending in ordinary Civil Courts must now be transferred to specialized Commercial Courts under Section 15(2) of the Act.
Distinguishing specified value from pecuniary jurisdiction
The Full Bench focused on a critical legal distinction between the “Specified Value” under Section 2(1)(i) and the “pecuniary value” defined in Section 3(1A). The judges explained that the specified value forms the core of a commercial dispute for admission into the specialized regime of the Act. In contrast, pecuniary value sets the competence parameters or the “floor-limit capability” of the specific court receiving the suit.
This technical separation allowed the court to overrule the previous coordinate Division Bench ruling in Bellam Balakrishna v. Greenmount Developers, which had incorrectly equated the two concepts. The Full Bench also corrected the stance in U.V. Satyanarayana v. M/s. Shriram City Union Finance Ltd., noting it failed to recognize that the amendment was prospective. The ₹3 lakh threshold cannot be applied retroactively to transactions that occurred before May 3, 2018, if their value was below the original ₹1 crore mark.
Mandatory infrastructure updates for Andhra Pradesh
To facilitate the transfer of cases, the High Court directed the immediate issuance of fresh proceedings to existing Commercial Courts in Visakhapatnam and Vijayawada. These courts must now handle disputes starting at the ₹3 lakh limit. This procedural clarity mirrors other judicial esfuerzos, such as the Andhra Pradesh High Court rules on explaining delays in commercial filings, which seek to maintain the efficiency of the specialized court system.
The State Government of Andhra Pradesh has further been ordered to implement G.O. Rt. No. 609, dated June 5, 2023. This order involves making 13 converted Commercial Courts at the Senior Civil Judge level fully functional. The State must now issue specific notifications under Section 3(1A) to define the exact pecuniary limits for these new benches, ensuring they are equipped to handle the influx of lower-value commercial suits.
| Court Level | Pecuniary Limit | Type of Jurisdiction |
|---|---|---|
| Senior Civil Judge | ₹3 Lakh to ₹50 Lakh | Specialised Commercial Jurisdiction |
| District Judge | Above ₹50 Lakh | Unlimited Commercial Jurisdiction |
| Ordinary Civil Court | Below ₹3 Lakh | General Civil Matters (Non-Commercial) |
Dissenting opinion on state notification requirements
While the bench was largely in agreement, Justice Ravi Nath Tilhari authored a separate, partially dissenting judgment. He concurred that no Central Government notification was required for the ₹3 lakh threshold. However, he argued that for disputes valued between ₹3 lakh and ₹1 crore, the amended value could not become operational in Andhra Pradesh until the State Government issued a notification under Section 3(1A) in consultation with the High Court.
The case, titled 3F Industries Limited v. Transparent Technologies Solutions Private Limited, involved prominent legal representation including Sri Venkat Challa and Sri G.V.S. Kishore Kumar for the petitioners. The majority ruling now stands as the definitive interpretation for the state. This move toward specialized resolution is consistent with broader national trends, including Supreme Court guidelines for summary judgments that aim to prevent unnecessary delays in commercial litigation.
Frequently Asked Questions
When did the ₹3 lakh commercial dispute threshold come into effect?
The threshold became operative on May 3, 2018, following the 2018 amendment to the Commercial Courts Act. The Andhra Pradesh High Court Full Bench ruled that this change took effect by its own force on that date without requiring further government notifications.
What is the difference between Specified Value and pecuniary value?
According to the court, “Specified Value” determines if a dispute qualifies as a commercial matter to enter the specialized court system. “Pecuniary value” refers to the specific financial limits that define which level of court (such as a Senior Civil Judge or District Judge) is competent to hear the case.
Are commercial cases filed before May 2018 affected by this ruling?
No, the amendment is prospective. The Full Bench clarified that the ₹3 lakh threshold cannot be applied to transactions that took place before the amendment date of May 3, 2018, if the dispute value was less than the previous ₹1 crore limit.