Khemka Food Products Pvt. Ltd. Vs. I.S.D.S. Private Limited and Others

Overriding Effect of Commercial Courts Act on Trademark Infringement Suits

Introduction: This case involves a commercial appeal filed before the High Court of Jharkhand at Ranchi, challenging an order that returned a plaint in a trademark infringement suit due to purported lack of jurisdiction. The appellant, a company engaged in the production and sale of wheat flour under the trademark "Grihasti Bhog," sought to enforce its rights against the respondents who were allegedly using an identical mark. The core issue revolved around the interplay between the jurisdictional provisions of the Trademarks Act, 1999, and the Commercial Courts Act, 2015, particularly in determining whether a Civil Judge (Senior Division) designated as a Commercial Court had the authority to entertain such a suit. The High Court's decision clarified the overriding effect of the Commercial Courts Act and emphasized the legislative intent to expedite commercial disputes through specialized courts at various levels. This judgment underscores the importance of harmonizing statutory provisions to ensure accessible and efficient resolution of intellectual property disputes in commercial contexts.

Factual Background:  The appellant, M/s Khemka Food Products Pvt. Ltd., traces its origins to a small flour mill established in 1970 under the name "Grihasti Atta Chakki" by the father of its director. Over time, the business expanded, leading to the company's incorporation in 1999 and the commencement of wheat flour production in 2001 after obtaining necessary permissions. The company adopted the trademark "Grihasti Bhog," which gained distinctiveness through long and continuous use, building goodwill and reputation. Applications for trademark registration were filed in 2005, 2012, and 2014, but were abandoned due to unavoidable circumstances. In February 2023, the appellant discovered that the respondents, I.S.D.S. Private Limited and its directors, were selling wheat flour under the identical mark "Grihasti Bhog." This prompted the appellant to issue a cease and desist notice on March 10, 2023, which the respondents replied to on April 6, 2023. The appellant then pursued pre-institution mediation under Section 12A of the Commercial Courts Act, 2015, before the District Legal Services Authority in Jamshedpur in April 2023, but the respondents refused to participate, resulting in a non-starter report.

Procedural Background: Following the failed mediation, the appellant instituted Commercial Suit No. 11 of 2023 on August 14, 2023, before the Civil Judge (Senior Division)-I-cum-Commercial Court at Jamshedpur, seeking relief for trademark infringement and passing off under Section 134 of the Trademarks Act, 1999. The suit was valued at Rs. 5,05,000/-. The respondents appeared on March 6, 2024, and filed their written statement, claiming use of the mark since 2022 without raising any jurisdictional objection at that stage. On June 15, 2024, the respondents filed an application under Order VII Rule 10 read with Section 151 of the Code of Civil Procedure, 1908, arguing that the Commercial Court lacked jurisdiction under Section 134 of the Trademarks Act, 1999, and that the plaint should be returned. The appellant opposed this application. The Commercial Court allowed the respondents' application on July 29, 2024, directing the return of the plaint for presentation before a court with jurisdiction. Aggrieved, the appellant filed the present Commercial Appeal No. 14 of 2024 before the High Court of Jharkhand, which was reserved on July 30, 2024, and pronounced on August 8, 2024.

Core Dispute: The central issue in this appeal was whether the Civil Judge (Senior Division)-I, designated as a Commercial Court under the Commercial Courts Act, 2015, possessed the jurisdiction to entertain a suit for trademark infringement under Section 134 of the Trademarks Act, 1999, especially when the suit's value was Rs. 5,05,000/- and fell within the pecuniary limits specified by state notifications. The respondents contended that Section 134 restricted such suits to "District Courts," interpreted as courts presided over by District Judges or higher, thereby excluding the Civil Judge (Senior Division). In contrast, the appellant argued that the Commercial Courts Act, 2015, had an overriding effect, allowing Commercial Courts at the Civil Judge (Senior Division) level to handle commercial disputes, including intellectual property matters, as defined under Section 2(1)(c)(xvii). The dispute highlighted the tension between traditional jurisdictional hierarchies under civil laws and the specialized framework introduced by the Commercial Courts Act to facilitate speedy resolution of commercial cases.

Discussion on Judgments:  In the proceedings before the High Court, neither the parties nor the bench explicitly cited any prior judicial precedents or case law from other courts. The arguments primarily revolved around statutory interpretations of the Trademarks Act, 1999, the Commercial Courts Act, 2015, the Code of Civil Procedure, 1908, and the Bengal, Agra and Assam Civil Courts Act, 1887, without reference to specific judgments. The appellant emphasized the overriding nature of the Commercial Courts Act under Section 21, but did not invoke any case citations to support this. Similarly, the respondents relied on a literal reading of Section 134 of the Trademarks Act, 1999, asserting that it mandated jurisdiction only with District Judges, yet no judicial authorities were referenced in their submissions or the lower court's order. The High Court's analysis drew upon the Statement of Objects and Reasons of the Commercial Courts Act, 2015, and its 2018 amendments, as well as the 188th and 253rd Reports of the Law Commission of India, which were mentioned in the context of justifying the need for independent mechanisms for resolving commercial disputes to enhance investor confidence. These reports were referred to underscore the legislative intent to expand access to commercial courts for disputes of lower value, but they do not constitute judgments. The absence of cited case law in the record suggests that the decision was grounded solely in statutory construction and legislative history, without reliance on precedential authority.

Reasoning and Analysis of the Judge: The High Court, in its reasoning, meticulously examined the legislative framework to resolve the jurisdictional conflict. It noted that the Commercial Courts Act, 2015, was enacted to provide for speedy resolution of commercial disputes, including those involving intellectual property rights under Section 2(1)(c)(xvii). The court highlighted the 2018 amendments, which reduced the specified value of disputes from Rs. 1 crore to Rs. 3 lakhs, aiming to make justice accessible at lower judicial levels. Emphasizing Section 3 of the Commercial Courts Act, which empowers state governments, in consultation with high courts, to constitute Commercial Courts at the district level or below, the bench observed that Jharkhand had issued notifications designating Civil Judges (Senior Division) as Commercial Courts for disputes valued between Rs. 3 lakhs and Rs. 1 crore, as per Notification No. 206/J dated February 8, 2021. The court critiqued the lower court's narrow interpretation of "District Court" under Section 134 of the Trademarks Act, 1999, as equating to "District Judge," clarifying that the term encompasses courts within the district hierarchy, including those below the District Judge when designated for specific purposes. It invoked the overriding effect of the Commercial Courts Act under Section 21, which prevails over conflicting provisions in other laws, and referenced the parliamentary debates and Law Commission Reports to affirm the intent to decentralize commercial adjudication. The analysis underscored that allowing appeals from Civil Judge-level Commercial Courts to District Judge-level Appellate Courts aligns with the Act's objective of efficiency, rejecting the respondents' contention as contrary to this scheme. The bench also stressed deference to high court notifications constituting such courts, concluding that the lower court erred in returning the plaint.

Final Decision: The High Court allowed the appeal, quashing and setting aside the order dated July 29, 2024, passed by the Civil Judge (Senior Division)-I in Commercial Suit No. 11 of 2023. The suit was restored to its original number, and the trial court was directed to proceed with adjudication in accordance with law. The parties were instructed to appear before the lower court on August 18, 2025.

Law Settled in This Case: This case settles that suits for trademark infringement, when qualifying as commercial disputes under Section 2(1)(c)(xvii) of the Commercial Courts Act, 2015, can be entertained by Commercial Courts constituted at the Civil Judge (Senior Division) level, provided they fall within the pecuniary jurisdiction specified by state notifications issued in consultation with the high court. It establishes the overriding effect of the Commercial Courts Act over Section 134 of the Trademarks Act, 1999, interpreting "District Court" broadly to include designated subordinate courts. The decision reinforces the legislative intent to expedite commercial resolutions by expanding access to lower-level specialized courts, ensuring that jurisdictional hierarchies under traditional civil laws yield to the specialized framework for commercial matters.

Case Title: Khemka Food Products Pvt. Ltd. Vs. I.S.D.S. Private Limited and Others

Date of Order: August 8, 2025

Case Number: Commercial Appeal No. 14 of 2024

Neutral Citation: 2025:JHHC:22504-DB

Name of Court: High Court of Jharkhand at Ranchi

Name of Judge: Tarlok Singh Chauhan, Chief Justice, and Sujit Narayan Prasad, Judge

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi