Introduction
An appeal seeks to ascertain whether Section 12A of the Commercial Courts Act, 2015 (henceforth referred to as “the Act”) contains the phrase “contemplates any urgent interim relief” in its application to an action for infringement of intellectual property rights This appeal is directed against the decision dated 13.11.2024 in Commercial Appeal No. 1 of 2024 issued by Division Bench of the High Court of Himachal Pradesh, by which it encounters dismissed the appeal of the appellant and has affirmed the order dated 28.08.2024 in Commercial Suit A learned Single Judge dismissed the appellant’s complaint for noncompliance with Section 12A of the Act.
Facts
Between 2007 and 2015, the appellant, a Danish company that manufactures industrial fans under the Novenco ZerAx brand, invested approximately 3.66 million euros in brand development and obtained multiple patents and design registrations in India and overseas. In order to market and sell its fans in India, it signed a dealership agreement with Xero Energy Engineering Solutions Pvt. Ltd., Hyderabad, on September 1, 2017. In violation of the agreement, the director of Xero Energy subsequently established Aeronaut Fans Industry Pvt. Ltd. to produce and market identical fans with a misleadingly similar name and appearance. After learning of this in July 2022, the appellant sent several inquiries seeking clarifications but did not receive a satisfactory response. As a result, the dealership was shut down on October 14, 2022, and Aeronaut Fans received a cease-and-desist notice on December 23, 2022. The appellant filed a commercial suit (COMS No. 13 of 2024) before the High Court on June 4, 2024, after obtaining patent and design certificates in May 2024 and expert confirmation of infringement in February 2024. The appellant sought an exemption from pre-institution mediation under Section 12A of the Commercial Courts Act, as well as an injunction under Order XXXIX Rules 1 and 2 CPC. In response, the respondents filed applications under Order VII Rules 10 and 11 CPC, arguing that the appellant’s injunction plea was not timely and that it did not comply with Section 12A.
Issues
Whether the suit is competent for “urgent interim relief” under the 2015 Commercial Courts Act’s Section 12A.
Whether the suit was institutionally incorrect due to non-compliance with Section 12A
Whether the lack of urgency was eliminated by the suit’s filing delay.
whether there is an inherent urgency to the ongoing violations of intellectual property rights
Whether it was incorrect for the High Court to dismiss the plaint for non-compliance with Section 12A under Order VII Rule 11 CPC.
Legal Provisions
Section 12A: Commercial Courts Act, 2015: This section is highly relevant as it talks about Pre-Institution Mediation and Settlement
Order XXXIX Rules 1 and 2: Code of Civil Procedure, 1908: Speaks about how Temporary Injunctions can be sought
Order VII, Rule 10 Code of Civil Procedure, 1908 deals with Return of the Plaint
Order VII, Rule 11 – Code of Civil Procedure, 1908 : deals with Rejecting the Plaint
Section 148A, Code of Civil Procedure, 1908: Deals with the Right to Lodge a Caveat
Arguments
Appellant
The appellant’s senior counsel argued that the High Court erred by failing to apply the proper test for finding the urgency when granting an interim injunction. He contended that the appellant’s request for urgent relief was genuine and not an attempt to avoid the mandatory pre-litigation mediation required by Section 12A. He went on to say that the plaint and its accompanying documents should be read together to determine whether there is an urgency. The counsel emphasized that mere delay in filing the suit does not defeat an injunction claim when intellectual property rights are being violated on a continuous basis. He cited Midas Hygiene Industries Pvt. Ltd. v. Sudhir Bhatia (2004) 3 SCC 90 and Yamini Manohar v. T.K.D. Keerthi (2024) 5 SCC 815 to support his arguments.
Respondent
The respondents’ senior counsel contended that both the Single Judge and the Division Bench correctly determined that the plaintiff lacked urgency. He pointed out that the appellant issued a cease-and-desist notice in December 2022 but did not file the suit until June 2024, nearly one and a half years and four months after the expert report. He contended that there was no justification for avoiding the mandatory pre-institution mediation required by Section 12A of the Commercial Courts Act. He also argued that simply filing an application for interim relief does not establish urgency, especially when there is no material evidence of ongoing patent violation. As a result, he argued that the appeal should be dismissed.
Analysis
The Court ruled that the most important issue was whether a suit alleging ongoinBecause the infringement was persistent, it resulted in continuous and irreparable injury to the appellant’s image and rights, underscoring the gravity of the situation. g infringement of patent and design rights, along with a request for interim injunction, constituted “urgent interim relief” under Section 12A despite some delay. It observed that each act of infringement creates a new wrong, resulting in a recurring cause of action, and that mere delay does not legalize infringement or waive the right to an injunction.
Conclusion
It concluded that just delaying the filing of the claim does not lessen the urgency of the case if the infringement continues. As a result, the Court overturned the orders of the Single Judge and the Division Bench of the High Court, reinstated Commercial Suit No. 13 of 2024 into the High Court’s file, and ordered that it be considered on the merits.. The appeal was allowed.
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WRITTEN BY S.KAVIYA SRI
