Case analysis: P. Sundaram c. Asia Match Company – Trademark

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This interim order on the question whether the respondent, based on the location of its branch, can maintain this action within the territorial jurisdiction of this Court, that is, a question on the question of the competence of the commercial division. The case was originally filed by the respondents in this case who are plaintiffs in the original lawsuit.

The respondent’s primary claim in this motion is that their trademark and Copyright were violated by the plaintiffs (defendants in the original lawsuit). The Respondents were of the view that the Applicant was passing off a misleading similarity of its label to that of the Respondent’s original label. The plaintiff, however, striking the angle of incorrect territorial jurisdiction in the original case, attempted to have the defendants’ cause quashed. Plaintiff’s allegation was that Defendants wrongly asserted the territorial jurisdiction of this Court solely on the basis of the location of one of Defendant’s branches, which is in Chennai.

To counter the plaintiff’s claim, the respondents took refuge under section 134(2) of the Trade Marks Act 1999 and section 62(2) of the Copyright Act . Both sections provide that any person may bring an action in such a district court in the jurisdiction of where the person resides or does business at the time the action is brought. One thing to note in the question of territorial jurisdiction, in this case, is that the impediment of article 20 of the Code of Civil Procedure has been lifted. With respect to copyright and trademark infringement, territorial jurisdiction under Articles 62(2) and 134(2) applies. This is why the defendants claimed that the question of territorial jurisdiction was not of concern in this case because they had their branch office in Chennai. They said they had business in their branch and therefore the matter fell within the jurisdiction of the Hon’ble Court. Whereas the Petitioners argued that the Respondents had their principal place of work in Sivakasi and this could be verified by carefully reading the complaint filed by the Respondents. In addition, no transactions relating to the business had been carried out through the branch. Further, there was no evidence to support that the GST had been paid by the branch.

The Supreme Court of The case of Sanjay Dalia mentioned the case of Sonic Surgical v. National Insurance Co. Ltd. in which, not examining the meaning of Articles (134(2) of the Trademark Law, 62(2) of the Copyright Law and 20 of the CPC), it sought the solution only for persons bringing an action in the territory of their respective branches. The Supreme Court said that in order to sue in the territory of the branch, part of the cause of action must have arisen in the territory of the branch. This will allow the person/owner to file/bring a lawsuit accordingly. To institute a lawsuit in a place where a branch is located, when no cause of action has arisen there, leads only to complete absurdity. In the words of the Court, this leads to ‘evil consequences.’ This Supreme Court decision was followed in the case Hindustan Unilever Limited Ponds House v S. Shanthi [2021 SCC OnLine Mad 5428]. Here, the plant was returned to the plaintiff stating that territorial jurisdiction does not exist if the cause of action (even in part) did not arise where the branch is located.

The question of the application of the principle of the convenience of the forum was also in the question of the relevance in the case. the meaning of this principle is quite self-explanatory. It literally means a convenient or appropriate forum. A person must bring an action in a forum of a jurisdiction in which he resides or has business and where all or part of the cause of action arose. This principle is simply intended to allow the aggrieved person to address the Court. Having understood the principle, the only lesson to be learned here is that plaintiffs/respondents must not take unfair advantage of the convenience offered to them. For example, if an entity carries on all its business in Delhi but brings a claim in a remote location where it has established its branch office but no business is carried on there, the claim becomes inadmissible in the court of such remote area. Similarly, in the present case, the petitioners knew that the action brought against them by the defendants was inadmissible because this Court did not have territorial jurisdiction to decide the case at issue. Respondents had their main office in Sivakasi, while they filed the complaint with the court in Chennai where their branch was located.

It was ultimately observed that the branch was not substantially functional and the cause of action, even in part, did not originate in Chennai. Accordingly, the application was granted and the Court held that the Commercial Division did not have territorial jurisdiction to pursue the present lawsuit. The defendants were therefore to pay Rs 50,000/- to the plaintiff/defendant within four weeks from the date of this order. To conclude, we observe that even in matters of IPR, the question of jurisdiction is sometimes as important as the question of the case itself. Also, competence is something which, when not followed, can be taken in a very negative light and can also affect the whole case as such, and (as we have seen in this case) may even result in penalties, in addition to the end result, regardless.

Case analysis: P. Sundaram c. Asia Match Company

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