Section 12A of the Commercial Courts Act is in applicable to suits involving urgent interim reliefs
Introduction:The case concerns a trademark and copyright dispute where the appellant, Chandra Kishore Chaurasia, filed a suit against R A Perfumery Works Private Limited for alleged infringement of his registered trademarks "1192" and "JAGMAG 1192" and copyright over their label and packaging. The dispute primarily involved the issue of territorial jurisdiction and compliance with the pre-institution mediation requirement under Section 12A of the Commercial Courts Act, 2015. The learned Commercial Court had returned the plaint for lack of territorial jurisdiction, leading to this appeal before the Delhi High Court.
Detailed Factual Background: The appellant, Chandra Kishore Chaurasia, claimed ownership of the trademarks "1192" and "JAGMAG 1192," which were registered under Class 34 with the Trade Mark Registry since 2012. Additionally, he had obtained copyright registration for the artistic work, layout, and packaging design of "JAGMAG 1192" in 2014. The appellant alleged that the respondent, R A Perfumery Works Private Limited, was manufacturing and selling chewing tobacco under the name "SIGNAL 1191," which was deceptively similar to his registered trademarks. The appellant contended that the respondent had deliberately adopted an identical label, color combination, and artistic elements, thereby infringing his copyright and passing off his products as those of the appellant.The appellant, a resident of Varanasi, claimed that the respondent, based in Kolkata, was clandestinely selling its infringing products in the markets of Delhi, particularly in Shahdara and Anand Vihar. He also alleged that the respondent was advertising and selling its goods online through platforms such as IndiaMart and the company's website, which were accessible in Delhi.
Detailed Procedural Background: The appellant filed a suit before the Commercial Court-II, Shahdara, Karkardooma, Delhi, seeking a permanent injunction against trademark infringement, copyright infringement, and passing off, along with rendition of accounts. The respondent filed an application under Order VII Rule 10 of the Code of Civil Procedure (CPC), seeking the return of the plaint for lack of territorial jurisdiction. The respondent also sought dismissal of the suit under Order VII Rule 11(d) CPC, arguing that the suit was not maintainable due to non-compliance with the mandatory pre-institution mediation requirement under Section 12A of the Commercial Courts Act, 2015.
The learned Commercial Court ruled that the appellant had failed to establish territorial jurisdiction and directed the return of the plaint. However, it rejected the respondent’s argument regarding non-compliance with Section 12A, as the appellant had sought urgent interim relief.The appellant challenged the Commercial Court’s decision before the Delhi High Court, while the respondent filed a cross-objection regarding the rejection of its application under Order VII Rule 11(d) CPC.
Issues Involved in the Case: Whether the Delhi High Court had territorial jurisdiction to entertain the suit? Whether the plaint was liable to be rejected due to non-compliance with the pre-institution mediation requirement under Section 12A of the Commercial Courts Act, 2015?
Detailed Submission of Parties: The appellant argued that territorial jurisdiction was established as the infringing products were being clandestinely sold in Delhi, and the respondent was advertising and offering its products for sale through interactive websites accessible in Delhi. The appellant contended that under Section 20(c) CPC, a part of the cause of action arose in Delhi, justifying the court's jurisdiction. The respondent contended that the appellant had not provided any concrete evidence of sales in Delhi and that mere apprehensions of future sales were insufficient to confer jurisdiction. The respondent further argued that the appellant had not complied with Section 12A of the Commercial Courts Act, which mandates pre-institution mediation for commercial suits not involving urgent interim reliefs.
Detailed Discussion on Judgments Along with Their Complete Citation Cited by Parties and Their Respective Context Referred in This Case: D. Ramachandran v. R.V. Janakiraman, (1999) 3 SCC 267, was relied upon to emphasize that an objection regarding jurisdiction must be determined based on the averments in the plaint, accepting them as true. The Supreme Court had held that for preliminary objections, the court should consider whether any relief could be granted based on the plaintiff’s claims. Liverpool & London S.P. & I Association Ltd. v. M.V. Sea Success I & Anr., (2004) 9 SCC 512, reiterated that whether a plaint discloses a cause of action is a question of fact and must be determined by reading the plaint as a whole. Exphar Sa and Anr. v. Eupharma Laboratories Ltd. and Anr., (2004) 3 SCC 688, supported the principle that an objection to jurisdiction, when raised at a preliminary stage, must proceed on the assumption that the plaintiff's claims are true.RSPL Limited v. Mukesh Sharma & Anr., (2016) SCC OnLine Del 4285, held that objections to territorial jurisdiction under Order VII Rule 10 CPC must be construed after taking all averments in the plaint as correct.Patil Automation Private Limited and Ors. v. Rakheja Engineers Private Limited, 2022 SCC OnLine SC 1028, was cited by the respondent to argue that Section 12A of the Commercial Courts Act is mandatory. The Supreme Court had ruled that non-compliance with Section 12A would result in the rejection of the plaint unless the suit involved urgent interim reliefs.
Detailed Reasoning and Analysis of the Judge: The Delhi High Court observed that at the stage of deciding an application under Order VII Rule 10 CPC, the court must assume the plaintiff’s averments to be true. If the appellant had pleaded that the respondent was clandestinely selling its products in Delhi and advertising them online, these claims must be taken at face value for jurisdictional determination. The Commercial Court had erred by requiring the appellant to provide evidence of clandestine sales at the preliminary stage. The court noted that while actual proof might be required at a later stage, the allegations in the plaint were sufficient to establish a prima facie case for jurisdiction.Regarding Section 12A of the Commercial Courts Act, the court held that the requirement of pre-institution mediation does not apply to suits involving urgent interim reliefs. Since the appellant had sought such reliefs, there was no obligation to undergo mediation before filing the suit. The court rejected the respondent’s contention that the plaintiff should have sought exemption through a separate application.
Final Decision: The Delhi High Court set aside the Commercial Court’s order directing the return of the plaint and held that the suit was maintainable in Delhi. The cross-objection filed by the respondent regarding non-compliance with Section 12A was dismissed. The appeal and cross-objections were disposed of accordingly.
Law Settled in This Case:F or deciding an application under Order VII Rule 10 CPC, the court must assume the averments in the plaint to be true and not require evidence at the preliminary stage. Clandestine sales and online advertisements can be sufficient to establish territorial jurisdiction in intellectual property disputes. Section 12A of the Commercial Courts Act, 2015 does not apply to suits where urgent interim reliefs are sought. There is no requirement for a plaintiff to seek exemption from Section 12A through a separate application.
Case Title: Chandra Kishore Chaurasia vs R A Perfumery Works Private Limited
Date of Order: 27 October 2022
Case No.: FAO (COMM) 128/2021
Neutral Citation: 2022/DHC/004454
Name of Court: Delhi High Court
Name of Judges: Hon'ble Justice Shri Vibhu Bakhru, Hon'ble Justice Shri Amit Mahajan
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Written By: Advocate Ajay Amitabh Suman,IP Adjutor [Patent and Trademark Attorney] ,High Court of Delhi
