Courts, Codes and the NCLT
Commercial disputes above a prescribed value go to dedicated Commercial Courts and commercial divisions of the High Courts, created to shorten timelines in business litigation. Insolvency matters go to the National Company Law Tribunal (NCLT), which is a separate forum and, for an unpaid supplier, frequently the more useful one.
One procedural point catches foreign creditors: the Commercial Courts Act requires pre-institution mediation before a suit is filed, unless urgent interim relief is sought. It is a step to plan for rather than discover.
The Operational Creditor Route
Under the Insolvency and Bankruptcy Code, a supplier of goods or services is an operational creditor. The process begins with a statutory demand notice; if the debtor neither pays nor raises a genuine pre-existing dispute within the period allowed, the creditor can apply to the NCLT to commence a corporate insolvency resolution process.
Admission of that application removes the existing management's control of the company and places it under an insolvency professional. For a solvent business that is simply withholding payment, that outcome is far worse than paying - which is why a substantial share of these matters settle between the demand notice and the hearing.
The route is available only where the debt exceeds the statutory threshold and there is no genuine pre-existing dispute. A debtor who raises a real dispute defeats the application, so the assessment of whether the dispute is genuine comes first.
Summary Suit Under Order XXXVII
Where the insolvency route is unavailable - the debt is below threshold, or a genuine dispute exists - the summary suit under Order XXXVII of the Civil Procedure Code is the standard path for a claim on a written contract or invoice. The defendant must seek leave to defend, and leave is refused where no triable issue is shown, which makes it materially faster than an ordinary suit.
Three Years
The Limitation Act 1963 gives three years for a claim on a contract, running from when the payment became due. An acknowledgement of the debt in writing signed by the debtor, or a part payment, gives a fresh period - and in Indian commercial practice, balance confirmations exchanged at year end are common and frequently constitute exactly that acknowledgement. It is worth searching for one before concluding a claim is time-barred.
How Long Does an Indian Claim Take?
| Stage | Typical Duration | Cost |
|---|---|---|
| Pre-legal demand Formal demand, negotiation, settlement | 3–6 weeks | Low |
| IBC demand notice Statutory notice, period to respond | 3–6 weeks | Low |
| NCLT application Filing to admission or settlement | 3–9 months | Medium |
| Summary suit Order XXXVII, leave to defend stage | 1–3 years | High |
| Arbitration Where the contract provides for it | 1–2 years | High |
How Does SXB Global Handle an Indian Case?
The first assessment is whether a genuine pre-existing dispute exists, because that single question decides between the insolvency route and everything slower. We also look for a written balance confirmation, which frequently resets a limitation position the creditor assumed was lost. Where legal proceedings become appropriate, SXB Global coordinates the instruction of appropriately authorised local counsel. Legal services are provided by the relevant independent legal professionals.