This case deals with the fundamental interplay between contractual agreements and the statutory framework governing trademarks. Specifically, it addresses the arbitrability of trademark disputes where the underlying contention stems from contractual assignment deeds containing arbitration clauses. The Supreme Court of India had to determine whether the matter should be referred to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996, despite allegations of fraud and forgery surrounding the execution of the assignment deeds.

Detailed Factual Background:
The plaintiffs (petitioners herein) K. Mangayarkarasi and her daughter Sreedevi filed a commercial suit against N.J. Sundaresan and Manonmani Angannan, seeking injunctive relief and damages concerning the use of the mark “SRI ANGANNAN BIRIYANI HOTEL.” The mark had emotional and commercial significance as it was associated with Mangayarkarasi’s late father Angannan, a renowned culinary figure in Coimbatore.

Following the death of Angannan in 1986 and subsequently her husband in 1990, Mangayarkarasi and her family allegedly retained control over the business and trademarks associated with “Sri Angannan.” Sundaresan, the son of Mangayarkarasi’s brother-in-law Jagadeeswaran (who had assisted in the family business), later claimed rights over the same trademark on the basis of two deeds of assignment dated 20.09.2017 and 14.10.2019, purportedly signed by Mangayarkarasi. The plaintiffs disputed the validity of these deeds, alleging fraud and forgery, stating they never consented to irrevocably assign the mark.

• Detailed Procedural Background:
  • A commercial suit (C.O.S. No. 147 of 2023) was filed by the plaintiffs before the Commercial Court, Coimbatore, seeking permanent injunctions and damages for the misuse of the trademark.
  • Sundaresan filed an application under Section 8 of the Arbitration and Conciliation Act, 1996, relying on the arbitration clauses embedded in the alleged assignment deeds.
  • The Commercial Court allowed the application, referring the parties to arbitration. This decision was affirmed by the Madras High Court in C.R.P. No. 1272 of 2024.
  • Dissatisfied, the plaintiffs approached the Supreme Court through Special Leave Petition (Civil) No. 13012 of 2025.
• Issues Involved in the Case:
  • Whether disputes involving trademark rights, arising out of assignment deeds containing arbitration clauses, are arbitrable?
  • Whether allegations of fraud in the execution of assignment deeds bar the matter from being referred to arbitration?
  • Whether non-signatory parties can be subjected to arbitration based on their derivation of rights under the agreement?
• Detailed Submissions of Parties:
  • The petitioners argued that the assignment deeds were fraudulently executed using blank stamp papers and that the arbitration clauses were not validly consented to.
  • They contended that forgery and fraudulent inducement vitiated the contract, making arbitration untenable.
  • The respondents submitted that the disputes arose from contractual assignment deeds, not from any statutory violation under the Trade Marks Act.
  • They emphasized that the arbitration clause clearly provided for resolution through arbitration, and that the plaintiffs' objection was an afterthought.
• Detailed Discussion on Judgments Cited:
  • Kvaerner Cementation India Ltd. v. Bajranglal Agarwal, (2012) 5 SCC 214: Tribunal can rule on its jurisdiction including validity under Section 16.
  • A. Ayyasamy v. A. Paramasivam, (2016) 10 SCC 386: Mere allegations of fraud do not bar arbitration unless they permeate the contract or involve public interest.
  • Booz Allen & Hamilton Inc. v. SBI Home Finance Ltd., (2011) 5 SCC 532: Rights in personam are arbitrable; assignment contract disputes are arbitrable.
  • Vidya Drolia v. Durga Trading Corporation, (2021) 2 SCC 1: Reiterated distinction between rights in rem and rights in personam.
  • SBI General Insurance Co. Ltd. v. Krish Spinning, 2024 SCC OnLine SC 1754: Even disputes alleging coercion/fraud in discharge voucher are arbitrable.
  • National Insurance Co. Ltd. v. Boghara Polyfab (P) Ltd., (2009) 1 SCC 267: Arbitration clause survives even if contract validity is challenged due to coercion or undue influence.
• Detailed Reasoning and Analysis of the Judge:
  • The Supreme Court found the dispute arbitrable since rights stemmed from private deeds, not statutory entitlements.
  • Referred to Booz Allen and Vidya Drolia to confirm that contractual rights are personal and hence arbitrable.
  • Rejected fraud claims due to the presence of signatures, notarization, and periodic payments—making fraud claims unsubstantiated.
  • Held that arbitrators are empowered to assess such claims as per Ayyasamy and Krish Spinning.
  • On the non-signatory issue, applied the doctrine of “claiming through or under” and found the third respondent bound by the arbitration agreement.
• Final Decision:
  • The Supreme Court upheld the decisions of the Commercial Court and the Madras High Court.
  • The Special Leave Petition was dismissed.
• Law Settled in this Case:
  • Trademark disputes from assignment agreements are arbitrable as they concern rights in personam.
  • Fraud allegations must permeate the entire contract or affect public interest to bar arbitration.
  • Parties deriving rights through/under signatories to an arbitration agreement are also bound.
  • Judicial interference under Section 8 of the Arbitration and Conciliation Act is limited.
• Case Details:
  • Case Name: K. Mangayarkarasi & Anr. v. N.J. Sundaresan & Anr.
  • Date: 09 May 2025
  • Petition: Special Leave Petition (Civil) No. 13012 of 2025
  • Citation: 2025 INSC 687
  • Court: Supreme Court of India
  • Judges: Hon'ble Justice J.B. Pardiwala and Justice R. Mahadevan

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
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539