Case Title: Novenco Building and Industry Vs Xero Energy Engineering Solutions Pvt. Ltd. & Anr.
Case Number: Civil Appeal No. ___ of 2025 (arising out of SLP (C) No. 2753 of 2025)
Neutral Citation: 2025 INSC 1256
Date of Judgment: October 27, 2025
Court: Supreme Court of India, Civil Appellate Jurisdiction
Coram: Hon’ble Mr. Justice Sanjay Kumar and Hon’ble Mr. Justice Alok Aradhe
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Facts
The appellant, Novenco Building and Industry A/S, is a Danish company involved in manufacturing high-efficiency industrial fans sold under the brand Novenco ZerAx. Between 2007 and 2015, the company invested approximately 3.66 million euros to develop this technology, securing patents and design registrations in India and other countries. To market its products in India, it entered into a dealership agreement on 1 September 2017 with Xero Energy Engineering Solutions Pvt. Ltd., a company based in Hyderabad.
According to Novenco, Xero Energy’s Director later breached the agreement by forming a separate company named Aeronaut Fans Industry Pvt. Ltd. (respondent no. 2), which began producing and selling identical fans under a deceptively similar name and appearance. The appellant discovered this in July 2022 and sent several communications to Xero Energy in August and October of that year, but received no explanation. As a result, Novenco terminated the dealership on 14 October 2022 and issued a cease-and-desist notice on 23 December 2022 to Aeronaut Fans, who replied in February and March 2023.
In December 2023, Novenco’s technical expert inspected fans installed by Aeronaut Fans at Cavendish Industries and Hero MotoCorp in Uttarakhand and confirmed infringement. After obtaining patent and design certificates between March and May 2024, Novenco filed a commercial suit (COMS No. 13 of 2024) before the Himachal Pradesh High Court on 4 June 2024, alleging infringement and seeking an interim injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure (CPC). It also sought exemption from pre-institution mediation under Section 12A of the Commercial Courts Act, 2015.
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Procedural Background
The respondents filed applications under Order VII Rules 10 and 11 of the CPC for return and rejection of the plaint, claiming that the suit was not maintainable for non-compliance with Section 12A of the Commercial Courts Act, which requires mandatory pre-institution mediation unless the suit “contemplates any urgent interim relief.” They argued there was no real urgency because Novenco had waited over six months after the inspection before filing the suit.
The learned Single Judge of the High Court rejected the plea for return of the plaint but accepted the objection regarding non-compliance with Section 12A. The Judge noted that since Novenco had known of the alleged infringement since December 2022, there was ample time to initiate mediation. The court held that the plaintiff’s claim of urgency was unsubstantiated and that the request for exemption was a mere formality. Therefore, the plaint was rejected under Order VII Rule 11 of CPC.
Novenco appealed, but the Division Bench of the Himachal Pradesh High Court affirmed the decision on 13 November 2024, holding that the plaintiff’s delay undermined any claim of urgency. It observed that continuous infringement of intellectual property rights did not automatically make a case urgent or exempt from mediation under Section 12A. However, it clarified that the rejection of the plaint would not bar the plaintiff from refiling the suit after following mediation.
Novenco then approached the Supreme Court of India. On 7 February 2025, while entertaining the Special Leave Petition, the Supreme Court directed Novenco to approach the mediation centre of the Himachal Pradesh High Court. Mediation was attempted but failed on 23 June 2025. The matter then returned to the Supreme Court for final adjudication.
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Core Dispute
The central issue before the Supreme Court was the interpretation of the phrase “contemplates any urgent interim relief” in Section 12A of the Commercial Courts Act, 2015, particularly in the context of intellectual property rights (IPR) disputes. The Court had to decide whether Novenco’s suit—alleging ongoing infringement of its patents and designs and seeking injunction—could be considered as contemplating “urgent interim relief” and therefore exempt from the mandatory requirement of pre-institution mediation.
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Arguments
For the Appellant (Novenco):
It was argued that both the Single Judge and the Division Bench misapplied the legal test under Section 12A. The appellant contended that the urgent interim relief was genuinely sought to stop continuing infringement and was not a device to avoid mediation. It emphasized that each act of infringement constituted a fresh cause of action and caused irreparable harm. Delay in filing the suit, it argued, did not negate urgency when the infringement continued to occur. The appellant relied on Midas Hygiene Industries Pvt. Ltd. v. Sudhir Bhatia (2004) 3 SCC 90, where the Supreme Court held that delay in bringing an action cannot legalize infringement, and Yamini Manohar v. T.K.D. Keerthi (2024) 5 SCC 815, which recognized that the need for urgent interim relief must be assessed from the plaintiff’s standpoint.
For the Respondents (Xero Energy & Aeronaut Fans):
The respondents argued that there was no actual urgency as the appellant had known of the alleged infringement since 2022 but filed the suit only in June 2024—after 18 months. They maintained that filing for interim relief did not automatically mean the case was urgent. Section 12A was mandatory, and the appellant could not bypass mediation merely by including a formal prayer for injunction. They relied on the principle that compliance with Section 12A is essential unless genuine urgency is demonstrated.
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Judicial Reasoning
The Supreme Court began by reviewing Section 12A of the Commercial Courts Act, which mandates pre-institution mediation for all commercial disputes unless the suit “contemplates any urgent interim relief.” The Court explained that this provision aims to encourage mediation as a first step, so that courts are approached only when necessary.
Referring to Patil Automation Pvt. Ltd. v. Rakheja Engineers Pvt. Ltd. (2022) 10 SCC 1, the Court reaffirmed that Section 12A is mandatory and non-compliance renders the plaint defective. However, it also examined Yamini Manohar (supra) and Dhanbad Fuels Pvt. Ltd. v. Union of India (2025 SCC OnLine SC 1129), where it was clarified that courts must examine whether urgent interim relief was genuinely contemplated from the plaintiff’s perspective—not whether such relief would ultimately be granted.
Applying these principles, the Court observed that intellectual property cases stand on a distinct footing. Infringement of patents and designs is typically a continuing wrong, meaning every instance of unauthorized manufacture or sale constitutes a fresh cause of action. The Court held that urgency in such cases does not depend on the time elapsed since discovery of infringement but on the persistence of the wrongful act and the ongoing harm to proprietary and public interests.
The Bench emphasized that intellectual property disputes often involve public interest because continued imitation can deceive consumers and erode faith in the marketplace. Thus, stopping such infringement serves not only the proprietor’s rights but also public confidence. The Court explained that “urgency lies not in the age of the cause, but in the persistence of the peril.”
The Court criticized the High Court’s narrow reading of Section 12A, stating that both the Single Judge and the Division Bench erred by focusing on the time gap instead of the nature of harm. They assessed the merits of the relief rather than the urgency itself. The Supreme Court clarified that the role of the court under Section 12A is not to decide the strength of the case but to determine whether, from the plaintiff’s viewpoint, there is a real need for interim intervention.
The Court noted that insisting on mediation during ongoing infringement would unfairly allow the infringer to continue profiting while the rights-holder remains helpless. Section 12A was never meant to produce such an unjust consequence. In the present case, since the appellant had specifically sought injunctive relief to prevent continuing harm and had filed supporting evidence of infringement, the requirement of urgency was clearly satisfied.
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Decision
The Supreme Court held that in cases involving ongoing infringement of intellectual property rights, the test of urgency must consider the continuous nature of the wrong and the accompanying public interest. Mere delay in filing the suit does not eliminate urgency if infringement persists.
Accordingly, the Court set aside the orders of the Single Judge (dated 28 August 2024) and the Division Bench (dated 13 November 2024) of the Himachal Pradesh High Court. The Court restored Commercial Suit No. 13 of 2024 to the High Court’s file and directed that the matter be heard on merits in accordance with law.
The appeal was allowed.
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Law Settled
The judgment establishes that:
1. In intellectual property infringement cases, urgency can be inherent in the continuing nature of the violation.
2. Courts must evaluate urgency from the plaintiff’s standpoint, not merely based on elapsed time.
3. Pre-institution mediation under Section 12A of the Commercial Courts Act is not mandatory when the plaint and documents reveal a genuine need for urgent interim relief.
4. Delay alone cannot negate urgency where the harm is ongoing and irreparable.
5. Public interest in preventing deception strengthens the case for immediate judicial intervention.
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Suggested Titles for Publication
1. Revisiting Urgency under Section 12A: The Supreme Court’s Pragmatic Approach in Novenco v. Xero Energy
2. Continuing Infringement and Procedural Mandates: How the Supreme Court Balanced Section 12A with IP Enforcement
3. Urgent Interim Relief in IP Disputes: A Liberal Interpretation by the Supreme Court of India
4. Delay vs. Urgency: The Novenco Judgment and Its Impact on Pre-Institution Mediation under the Commercial Courts Act
5. From Procedure to Justice: Supreme Court Clarifies the True Test of Urgency under Section 12A in IP Litigation
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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
