This case pertains to a civil revision application filed by Maheshbhai Hajibhai Sojitra, proprietor of Siddhi Lime, challenging an order passed by the 7th Additional District Judge, Rajkot, in a trademark suit. The core issue revolves around the jurisdiction of the court to entertain the suit, specifically whether the Commercial Court had exclusive jurisdiction based on the nature and valuation of the dispute. The case highlights the nuances of jurisdictional jurisdiction under the Commercial Courts Act, 2015, and the applicability of Order VII Rule 11 CPC in dismissing plaints. The recent order by the Gujarat High Court involves a correction of a previous judgment, underscoring the importance of accurate citations and proper procedural considerations.

Detailed Factual Background: The plaintiff, Maheshbhai Hajibhai Sojitra, filed a suit for permanent injunction, claiming infringement of trademark, passing off, and copyright. The plaint sought to restrain the defendant, Babu Lime Private Limited, from manufacturing, marketing, and selling edible lime using a deceptively similar trademark ‘SIDDHI’, along with reproduction of artistic work representing copyright infringement. The plaintiff asserted that the defendant’s use of the mark and artistic work was an imitation of the plaintiff’s registered copyright and trademark rights. The reliefs included permanent injunctions, a declaration of exclusive rights over the trademarks ‘BABU’ and ‘DELUXE’, accounts of profits, and damages with interest.

Procedural Background: The defendant moved an application under Order VII Rule 11 CPC to reject the plaint on the ground that the suit did not fall within the jurisdiction of the Commercial Court, primarily because the valuation of the suit was below Rs. 3 lakhs and the dispute did not satisfy the statutory criteria for a commercial dispute as per Section 2(1)(c)(xvii) of the Commercial Courts Act, 2015. The Trial Court rejected this application, holding that the suit was maintainable in the regular civil jurisdiction. The defendant challenged this order through a civil revision application before the High Court. The High Court, upon re-examining the case, noted that an omission had occurred in citing relevant legal authorities, which was later rectified by the court’s order dated 01/05/2025, citing a pivotal judgment, MANU/KA/1066/2024. The court then modified its earlier judgment accordingly.

Issues Involved in the Case: The primary issue concerned whether the civil suit was maintainable within the jurisdiction of a commercial court, specifically whether the dispute qualified as a ‘commercial dispute’ under Section 2(1)(c) of the Commercial Courts Act, and whether its valuation exceeded Rs. 3 lakhs? The second issue was whether the application under Order VII Rule 11 CPC should have been allowed, leading to rejection of the plaint on the grounds of non-compliance with jurisdictional and valuation criteria?

Parties' Detailed Submissions: The petitioner contended that the dispute fell squarely within the domain of Section 2(1)(xvii) of the Commercial Courts Act, as it involved infringement of trademarks and copyright related to goods valued above Rs. 3 lakhs. He argued that the defendant under-valued the claim just to keep the suit within the ordinary jurisdiction, which was outside the legislative intent of the law. Relying on judgments such as 2022 (0) AIJEL – 7000 and an unreported judgment from Karnataka High Court in Civil Revision Application No.426 of 2023, he submitted that the commercial court’s jurisdiction was barred only if both the nature of dispute and its valuation met the statutory conditions, which it did. He further emphasized that the defendant’s argument about the suit’s valuation was unfounded since the plaintiff’s initial valuation was above the threshold.

The respondent, Babu Lime Pvt. Ltd., argued that the suit was not a ‘commercial dispute’ as per the definition, and the valuation was less than Rs. 3 lakhs, which should limit the jurisdiction to the ordinary civil courts. Their advocate relied on established legal principles, including the Supreme Court’s judgment in Vishal Pipes and the Karnataka High Court decision in Kirloskar Aaf Limited v. American Air Filters Company Inc., to assert that the discretion to choose the forum rested solely with the plaintiff and that the defendant could not insist on a specific court unless jurisdiction was lacking.

Discussion of Judgments and Their Citations: The High Court’s order of 01/05/2025 referenced the Karnataka High Court judgment in Kirloskar Aaf Limited v. American Air Filters Company Inc., which clarified that the two essential criteria for jurisdiction under the Commercial Courts Act are the existence of a ‘commercial dispute’ as per Section 2(c) and a minimum pecuniary threshold of Rs. 3 lakhs. The court also relied on the judgment in Vishal Pipes, which underscored that a suit involving intellectual property rights can qualify as a ‘commercial dispute’ if it involves commercial transactions and the valuation exceeds the stipulated amount. The cited case MANU/KA/1066/2024 clarified the importance of proper citation and what constitutes a ‘commercial dispute’.

Further, the court noted that the legislative intent behind the Commercial Courts Act was to establish a specialized forum for disputes of a certain value, and that the valuation and nature must be analyzed in conjunction to determine jurisdiction. It reaffirmed that the plaintiff’s valuation, if properly documented, could not be disregarded solely on the basis of under-valuation by the defendant, and that the court must rely on the contents of the plaint and statutory provisions.

Reasoning and Analysis by the Judge: The Judge emphasized that jurisdictional questions must be approached holistically, considering both the nature of the dispute and the valuation as per Section 12 of the Commercial Courts Act. The court acknowledged the principles laid down in the judgments cited by both parties but noted a potential oversight regarding the citation of legal authorities in the previous order. The court, therefore, corrected the omission and held that the initial order was based on a thorough judicial appreciation of the facts and applicable law. It observed that the essential question was whether the suit involved a ‘trade dispute’ of the kind envisaged under the law and whether it pertained to goods or intellectual property valued above Rs. 3 lakhs.

The court found that the plaintiff’s claims regarding copyright infringement and trademark violations, coupled with the valuation, clearly qualified the dispute as a ‘commercial dispute’. Consequently, the application under Order VII Rule 11, which sought to reject the plaint for lack of jurisdiction, was not justified. The order of the Trial Court was thus set aside, and the suit was allowed to proceed in the appropriate forum.

Final Decision: The High Court, upon considering all aspects, dismissed the application for rejection under Order VII Rule 11 CPC, holding that the suit was properly maintainable within the jurisdiction of a commercial court. The earlier rejection of the suit was set aside, and the judgment was modified accordingly, with clarification on the importance of proper citation and legal referencing. The case was remanded for further proceedings on merits.

Law Settled in This Case: This case reaffirmed the legal proposition that in cases involving intellectual property rights and commercial disputes, the jurisdiction of the commercial courts depends on both the nature of the dispute and the valuation. The twin requirements must be satisfied for the court to entertain the commercial suit, and mere undervaluation by the defendant does not automatically bar the suit if the plaintiff’s valuation and statement of facts qualify under the statutory criteria. It also clarified the importance of precise legal citations and the need for courts to rely on established judgments for clarity in legal proceedings.

Case Title: Maheshbhai Hajibhai Sojitra vs Babu Lime Private Limited: Date of Order: 01/05/2025: Case Number: R/CRA/447/2023: Neutral Citation: 2025:GUJHC:24876: Name of Court: High Court of Gujarat at Ahmedabad: Name of Judge: Hon’ble Mr. Justice Sanjeev J. Thaker: 

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Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539