ITC Limited & Anr. v. Adyar Gate Hotels Limited

Court: High Court of Delhi at New Delhi (Division Bench) Date of Decision: 1 July 2026 Case Number: FAO(OS)(COMM) 207/2025 & CM APPL. 79554/2025 Bench: Justice C. Hari Shankar and Justice Om Prakash Shukla

BACKGROUND

The appellant, ITC Limited, is a company engaged in the hospitality business and is the owner of a chain of hotels. The respondent, Adyar Gate Hotels Limited, is the owner of a building at 132 TTK Road in the city of Chennai. By an Operating Service Agreement dated 12 February 1985, AGH engaged ITC to provide operating services in respect of the hotel known as the Welcome group Park Sheraton Hotel, which was set up in AGH’s building in 1985. Under the arrangement, ITC provided technical, operational, personnel, hotel supplies, marketing, advertising and reservation services to AGH as a service provider, receiving a Service Fee equivalent to three percent of the Gross Operating Income and an Incentive Fee equivalent to ten percent of the Gross Operating Profit.

With effect from 14 April 1989, a South Indian restaurant named “Dakshin,” using the logo comprising the word DAKSHIN together with a distinctive device, commenced operations within the Park Sheraton. The Dakshin restaurant operated continuously within the Park Sheraton until the expiry of the OSA on 31 March 2015, a period of approximately twenty-six years. The DAKSHIN mark was registered in favour of ITC under the Trade Marks Act with effect from 13 September 2000 in Classes 29 and 30, covering food products. The user claim was subsequently amended, on application by ITC, to 1 April 1989 in 2005. ITC additionally registered the logo as an artistic work under the Copyright Act on 15 November 1989. ITC also obtained a Class 42 registration for the DAKSHIN mark relating to restaurant services with effect from 10 February 2004.

A parallel dispute arose in connection with the Class 42 registration of the DAKSHIN mark in favour of AGH. AGH applied for this registration on 23 April 2004, claiming user since 14 April 1989. The Trade Marks Registry cited ITC’s registration as a competing mark, whereupon AGH represented that the mark belonged to a group company. AGH obtained the registration on 16 September 2005, subject to association with ITC’s registration.

Following the expiry of the OSA on 31 March 2015, ITC withdrew from the hotel. AGH entered into a fresh arrangement with the InterContinental Hotel chain and a new hotel named Crowne Plaza Chennai Adyar Park commenced operations in the same premises. Notwithstanding the expiry of the OSA, AGH continued to run the Dakshin restaurant in the Crowne Plaza under the same DAKSHIN mark from 2015 until 2023. During this entire period, ITC did not object to AGH’s continued use of the mark. In April-July 2024, the building housing the Crowne Plaza was demolished. Thereafter, AGH opened a new standalone Dakshin restaurant under the DAKSHIN mark on the same road, at some distance from the original site.

It was only in October 2024, when ITC came across this new standalone restaurant, that ITC instituted the suit CS(Comm) 119/2025 before the Delhi High Court seeking a permanent injunction restraining AGH from using the DAKSHIN mark on the grounds of trade mark infringement and passing off, along with prayers for delivery-up, damages and costs. ITC also pleaded infringement of its registered copyright in the logo. An application IA 3768/2025 for interlocutory injunction was filed along with the suit. An ad interim injunction was granted on 13 February 2025. By the impugned judgment dated 4 December 2025, the learned Single Judge dismissed IA 3768/2025. ITC appealed to the Division Bench under Section 13 of the Commercial Courts Act, 2015.

The dispute presented the following issues before the learned Single Judge: first, territorial jurisdiction of the Delhi High Court; second, whether AGH obtained its Class 42 registration by misrepresentation; third, the ownership of the DAKSHIN mark and the interpretation of the OSA; fourth, whether a case of passing off was made out; fifth, the plea of acquiescence advanced by AGH under Section 33(1) of the Trade Marks Act; and sixth, the claim of copyright infringement. The learned Single Judge held, prima facie, against ITC on all these issues and dismissed the application. The Division Bench took up the appeal against this order.

ISSUES FOR DETERMINATION

1. First, the Division Bench was required to determine whether the learned Single Judge could validly proceed to pronounce prima facie on the merits of the dispute, having already held that the Court had no territorial jurisdiction and whether there was any legal embargo on such a course.
2. Second, the Bench was required to determine the scope of appellate interference in an appeal against a discretionary order passed under Order XXXIX of the Code of Civil Procedure, with reference to the principles established in Wander Ltd. v. Antox (India) Pvt. Ltd. and subsequent decisions.
3. Third, the Court was required to determine whether the suit instituted by ITC before the Delhi High Court was maintainable on the ground of territorial jurisdiction and more specifically: whether Section 134(2) of the Trade Marks Act could be invoked; whether AGH could be said to be carrying on business within the territorial jurisdiction of the Court for the purposes of Section 20(a) of the CPC, by reason of its listing on the Zomato e-commerce platform and online interaction with customers; and whether part of the cause of action arose within Delhi under Section 20(c) of the CPC.
4. Fourth, the Court was required to determine whether AGH obtained the Class 42 registration of the DAKSHIN mark by misrepresentation.
5. Fifth and centrally, the Court was required to interpret the covenants of the OSA to determine: the role of ITC under the OSA whether it was a service provider or the prime mover; the date from which user of the DAKSHIN mark by AGH could be said to commence; and in whose favour the goodwill of the DAKSHIN mark earned during the currency of the OSA enured.
6. Sixth, the Court was required to determine whether the three classical ingredients of passing off goodwill of ITC in the DAKSHIN mark prior to commencement of user by AGH, misrepresentation by AGH and resultant injury to ITC were prima facie satisfied.
7. Seventh, the Court was required to determine whether ITC’s claim was barred by the principle of acquiescence under Section 33(1) of the Trade Marks Act, in view of ITC’s long silence from 1989 to 2023.
8. Eighth, the Court was required to determine whether ITC had prima facie established ownership of the registered copyright in the DAKSHIN logo so as to sustain a claim for copyright infringement.

KEY HOLDINGS OF THE COURT

First, on the question of whether the learned Single Judge could pronounce on the merits having found, prima facie, no territorial jurisdiction, the Division Bench held that there was no infirmity in such a course. The Court reasoned that the order under appeal was in the nature of an interim order under Order XXXIX of the CPC and all views expressed therein including on territorial jurisdiction were necessarily tentative and prima facie in character. Such a prima facie view does not foreclose discussion on any aspect of the dispute. The Division Bench further relied on the Supreme Court’s observation in Hemlata Eknath Pise v. Shubham Bahu-uddeshiya Sanstha Waddhama that Courts, when faced with multiple issues, should ideally record answers to each issue with reasons and on Order XIV Rule 2(1) of the CPC, which requires pronouncement on all issues even where a case may be disposed of on a preliminary issue.

Second, on the scope of appellate interference, the Court held that, following the law established in Wander, Ramakant Ambalal Choksi v. Harish Ambalal Choksi and Pernod Ricard India (P) Ltd. v. Karanveer Singh Chhabra, an appellate court would not interfere with the exercise of discretion by a Single Judge in an Order XXXIX matter unless such discretion has been shown to have been exercised arbitrarily, capriciously, perversely or in disregard of settled principles of law. The more recent emphasis is on perversity rather than a mere error of fact or law.

Third, on territorial jurisdiction, the Court held as follows. Section 134(2) of the Trade Marks Act, which confers on a plaintiff the benefit of suing in the court within whose jurisdiction it resides or carries on business, is available only in suits falling under clauses (a) and (b) of Section 134(1), that is, suits for infringement of a registered trade mark or suits relating to a right in a registered trade mark. It does not extend to suits for passing off under clause (c) of Section 134(1). Since no action for infringement can lie between the proprietors of two registered, co-existing trade marks in view of Sections 28(3) and 30(2)(e) of the Trade Marks Act, ITC’s only maintainable claim was for passing off and Section 134(2) accordingly did not apply. Territorial jurisdiction had therefore to be assessed under Section 20 of the CPC.

On Section 20(a), the Court disagreed with the learned Single Judge and held that ITC had prima facie discharged its onus to demonstrate that AGH was carrying on business within the territorial jurisdiction of the Delhi High Court. The Court found that the presence on the Zomato e-commerce platform of an “Order Online” link in respect of AGH’s Chennai Dakshin restaurant, through which a table reservation could be made from Delhi, constituted interactive accessibility sufficient to constitute prima facie carrying on of business within the Court’s jurisdiction. The Court held that a commercial transaction is not concluded only upon physical dining at the restaurant and that the ability to reserve a table online from Delhi with no substantial rebuttal from AGH was sufficient at the Order XXXIX stage to demonstrate AGH’s business presence within Delhi. AGH’s practice of responding to customer reviews on the Zomato platform further fortified this finding of meaningful interaction. The Court also noted that the law established through a line of decisions from Banyan Tree Holding to Kohinoor Seed Fields and Sauss Home Products proceeded on the basis that interactive accessibility particularly the ability to conclude a commercial transaction over a website or e-commerce platform confers territorial jurisdiction.

On Section 20(c), the Court held that, in a passing off action, the cause of action includes the ingredient of injury or damage suffered by the plaintiff. Since ITC’s Dakshin restaurants are located in cities other than Chennai, including Delhi, the injury or damage arising from AGH’s use of the DAKSHIN mark whether actual or apprehended would be suffered at the location of ITC’s Dakshin outlets, including Delhi. The entire cause of action, in so far as ITC’s grievance was concerned, therefore arose outside Chennai and, in part, at Delhi. The Court further held that the law under IPRS, as interpreted in the extracted passages from paras 18 to 20 and 25 and 26, was intended to operate only in the context of Section 134 of the Trade Marks Act and Section 62 of the Copyright Act and did not govern a situation where the aspect of territorial jurisdiction was governed solely by Section 20 of the CPC. The rule from IPRS that a plaintiff cannot sue at a distant subordinate office when the cause of action has also arisen at the principal place of business has no application here, because Section 134 was inapplicable and part of the determinative cause of action arose in Delhi where ITC’s Dakshin restaurant is situated. The Court accordingly held that the finding of the learned Single Judge on territorial jurisdiction was erroneous and that ITC was entitled to invoke the jurisdiction of the Delhi High Court under both clauses (a) and (c) of Section 20 of the CPC.

Fourth, on the question of whether AGH obtained its Class 42 registration by misrepresentation, the Court agreed with the learned Single Judge that no prima facie case of misrepresentation was established. The Court reasoned that at the time AGH applied for registration, ITC and AGH were in collaboration and AGH’s loose reference to ITC as a “group company” was a plausible description of the relationship. Additionally, by virtue of Section 31(1) of the Trade Marks Act, registration itself operates as prima facie evidence of the validity of the mark and ITC had never opposed the registration nor subsequently sought its rectification under Section 57.

Fifth, on the interpretation of the OSA and the date of commencement of user by AGH, the Court agreed with the learned Single Judge that ITC was a mere service provider under the OSA. The Court based this conclusion on a detailed reading of the covenants of the OSA, including the opening recitals (which described ITC as providing “expert consultancy services in the field of hoteliering”), Article II (which expressly described ITC’s engagement as one “to render personal services”), Clause 4 in Part A of Article IV (which required AGH to provide tools, machinery and equipment “to enable ITC to render services”), Clause 8 in Article XIX (which expressly stated that the OSA was “a contract of personal service to be rendered by ITC to the Owner and must not be construed in any form and manner to be otherwise”), Article V (which provided for payment of Service Fee and Incentive Fee in consideration of ITC’s services), Clause 1 in Article VI (which specified that ITC would not invest in the Hotel in any way) and Article XVI (which required AGH to indemnify ITC for all claims). The Court found that the provision of ITC’s goodwill in its brands to AGH was itself one of the services rendered by ITC against payment of service fee, as reflected in Appendix II Clause B(I)(1) of the OSA.

On the date of commencement of user by AGH, the Court held that AGH must be treated as having commenced user of the DAKSHIN mark on 14 April 1989, when the restaurant opened. This followed from Article XIII of the OSA which, read as a whole, envisaged use of ITC’s trademarks and trade names by AGH and from Clause 6 in Article XIII which provided that, upon termination or expiry of the OSA, the Owner AGH would cease to use the marks. Use of the marks under the OSA was therefore by AGH, even if on a permissive basis and for the benefit of the Hotel. ITC’s attempt to characterise AGH’s user of the DAKSHIN mark as commencing only from 2015 was accordingly rejected as prima facie unsustainable.

Sixth, on the first ingredient of passing off pre-existing goodwill of ITC in the DAKSHIN mark prior to commencement of AGH’s user the Court held that this ingredient was not satisfied. Since the DAKSHIN mark came into existence only in 1989, four years after the OSA was executed, there was no pre-existing goodwill of ITC in the DAKSHIN mark prior to 14 April 1989. The Welcomgroup and Namaste marks were the pre-existing ITC marks referenced in the OSA and the DAKSHIN mark was not among them. Furthermore, even on the alternative premise that goodwill was to be reckoned as of 2015, the goodwill in the DAKSHIN mark earned between 1989 and 2015 did not enure exclusively to ITC. The Court found that, under the OSA, all operating expenses were borne by AGH, the accounts were maintained by AGH’s funds and ITC did not invest in the Hotel in any way. The OSA further expressly envisaged that ITC’s goodwill would “be made available to the Owner” for the benefit of Hotel marketing, against payment of service fee. AGH, as the prime financier of the Hotel’s operations, was entitled to the benefit of the goodwill earned in the DAKSHIN mark during the currency of the OSA. Neither at 1989 nor at 2015 could ITC establish exclusive pre-existing goodwill in the DAKSHIN mark sufficient to sustain a claim for passing off.

Seventh, on the second and third ingredients of passing off misrepresentation and injury/damage the Court held that these were, at the very best, arguable triable issues and did not rise to the level required for the grant of an interlocutory injunction. The Court found no material to indicate that AGH had at any time represented, to the public, any association between its Dakshin restaurant at Chennai and the Dakshin outlets of ITC. AGH’s Dakshin restaurant existed only in Chennai and ITC had no Dakshin outlet in Chennai. Whether the consumer public was misled into believing an association between the two restaurants and whether any actual damage had been suffered by ITC or its Delhi outlet, were matters for trial.

Eighth, on acquiescence under Section 33(1) of the Trade Marks Act, the Court agreed with the learned Single Judge. The Court held that ITC had maintained silence for the entire period from 1989 to 2015 during which the OSA was in force and had thereafter continued to maintain silence from 2015 to 2023 while AGH openly used the DAKSHIN mark at the Crowne Plaza, in ITC’s full knowledge. This silence, extending well beyond the five-year period prescribed in Section 33(1), amounted to acquiescence and Section 33(1) accordingly constituted a statutory bar to the grant of injunction. The Court further held that ITC had not chosen to file any rectification application under Section 57 of the Trade Marks Act challenging AGH’s Class 42 registration, which also remained unchallenged. The Court distinguished Midas Hygiene Industries v. Sudhir Bhatia on the basis that that decision concerned infringement and also on the basis that ITC’s claim could only be for passing off, not infringement. Even on an harmonised reading of Midas Hygiene and Power Control Appliances v. Sumeet Machines, the statutory bar under Section 33(1) in a clear case of acquiescence could not be wished away.

Ninth, on copyright infringement, the Court agreed with the learned Single Judge. The Copyright Registration Certificate identified the author of the logo as Indu Balachandran, who was an employee of HTA. By operation of clause (c) of the proviso to Section 17 of the Copyright Act, HTA was the first owner of copyright in the logo. No written document of assignment of copyright by HTA in favour of ITC was on record and Section 19(1) of the Copyright Act requires any assignment of copyright to be in writing. Furthermore, Section 48 of the Copyright Act, unlike Section 31(1) of the Trade Marks Act, does not create a presumption of ownership from registration, but merely makes the register of copyrights prima facie evidence of the particulars entered therein. ITC therefore failed to establish prima facie ownership of the copyright in the logo.

Finally, on the operative order, the Division Bench held that while it disagreed with the learned Single Judge on the aspect of territorial jurisdiction, it agreed with him on all the merits and found no case deserving of interference. The appeal was accordingly dismissed.

STATUTORY PROVISIONS INVOLVED

Section 20 of the Code of Civil Procedure, 1908 governs territorial jurisdiction in the case of suits that are not covered by the special provisions of the Trade Marks Act or Copyright Act. The Court applied this provision to hold that the Delhi High Court had territorial jurisdiction under clause (a) by reason of AGH carrying on business within the Court’s jurisdiction through its interactive presence on the Zomato e-commerce platform and under clause (c) because part of the cause of action, specifically the injury element of the passing off claim, arose in Delhi where ITC’s Dakshin outlets were located. The Court also addressed and distinguished the IPRS principle as being confined in its operation to the special provisions of Section 134 of the Trade Marks Act and Section 62 of the Copyright Act.

Section 28(3) of the Trade Marks Act, 1999 provides that where two or more persons are registered proprietors of trade marks that are identical with or nearly resemble each other, the exclusive right to use any such trade mark shall not be deemed to have been acquired by any one of them as against any other merely by registration. The Court applied this provision to hold that no action for infringement could lie between ITC and AGH, as both were co-proprietors of the DAKSHIN mark and that ITC’s only maintainable claim was therefore one of passing off.

Section 30(2)(e) of the Trade Marks Act, 1999 provides that a registered trade mark is not infringed where the use is of one of two or more registered trade marks which are identical or nearly resemble each other, in exercise of the right to use that trade mark given by registration. This provision reinforced the conclusion that no infringement action lay between the parties.

Section 33(1) of the Trade Marks Act, 1999 provides that where the proprietor of an earlier trade mark has acquiesced for a continuous period of five years in the use of a registered trade mark, being aware of such use, it shall no longer be entitled to apply for a declaration that the later registration is invalid or to oppose the use of the later mark in relation to the goods or services in respect of which it has been so used, unless that registration was not applied for in good faith. The Court applied this provision to hold that ITC’s claim for interlocutory injunction was barred, ITC having allowed AGH to use the DAKSHIN mark from 1989 to 2023 without any objection.

Section 31(1) of the Trade Marks Act, 1999 provides that in all legal proceedings relating to a registered trade mark, the original registration shall be prima facie evidence of its validity. The Court applied this provision to hold that, at the prima facie stage, AGH’s Class 42 registration was presumed valid and ITC had not taken steps to challenge it.

Section 134(1) and (2) of the Trade Marks Act, 1999 were considered in the context of territorial jurisdiction. The Court held that Section 134(2), which extends the venue for infringement suits to the court within whose jurisdiction the plaintiff carries on business, applies only to suits under clauses (a) and (b) of Section 134(1) and not to suits for passing off under clause (c). Section 134(2) was therefore held inapplicable to ITC’s suit.

Section 17 of the Copyright Act, 1957 governs the first ownership of copyright. Clause (c) of the proviso provides that where a work is made in the course of the author’s employment under a contract of service, the employer, in the absence of agreement to the contrary, is the first owner of the copyright. The Court applied this provision to hold that, since the author of the DAKSHIN logo, Indu Balachandran, was an employee of HTA, HTA was the first owner of copyright in the logo.

Section 19(1) of the Copyright Act, 1957 provides that no assignment of copyright shall be valid unless it is in writing signed by or on behalf of the assignor. The Court applied this provision to hold that, in the absence of any written assignment from HTA to ITC, no valid assignment of copyright could be presumed and ITC’s claim of copyright ownership accordingly failed at the prima facie stage.

Section 48 of the Copyright Act, 1957 provides that the Register of Copyrights shall be prima facie evidence of the particulars entered therein. The Court drew a clear distinction between this provision and Section 31(1) of the Trade Marks Act, noting that while the latter creates a presumption of the validity of a registered mark, Section 48 creates only a presumption as to the particulars entered in the register and not as to the ownership of copyright.

Article XIII of the Operating Service Agreement dated 12 February 1985 was the central contractual provision interpreting the ownership of trade marks. The Court interpreted this Article together with the opening recitals, Article II, Article IV, Article V, Article VI, Article XVI, Article XIX and Appendix II of the OSA to hold that ITC was a service provider whose rendering of access to its brands and goodwill was itself one of the contracted services and that AGH, as the prime actor and financier, was the User of the trade marks even during the currency of the OSA. The Court further held that the DAKSHIN mark, having come into existence only in 1989, did not fall within the pre-existing trademarks of ITC to which Article XIII primarily referred.

REASONING OF THE COURT

The Division Bench approached the dispute systematically, addressing each issue in turn within the parameters established by Wander.

On the preliminary procedural question of whether the learned Single Judge could pronounce on the merits despite finding no territorial jurisdiction, the Court reasoned that the interim and tentative character of all findings at the Order XXXIX stage necessarily meant that no finding whether on jurisdiction or on the merits was final or closed. The Court reinforced this with the requirement in Order XIV Rule 2(1) of the CPC that all issues be pronounced upon and with the Supreme Court’s recent observation in Hemlata Eknath Pise emphasising the virtue of comprehensive reasoning.

On the territorial jurisdiction issue, the Court’s central reasoning proceeded from the principle that interactive accessibility particularly the ability to reserve a table or order services from within a court’s jurisdiction over an e-commerce platform constitutes carrying on business within the meaning of Section 20(a) of the CPC. The Court was not persuaded by the Single Judge’s view that a commercial transaction was only concluded upon physical dining at the restaurant. The Court found the “Order Online” link on the Zomato page of AGH’s Dakshin restaurant to be sufficient, at the prima facie stage, to discharge ITC’s burden. On Section 20(c), the Court’s reasoning was straightforward: in a passing off action, injury is an essential ingredient of the cause of action and the injury would be suffered where ITC’s Dakshin outlets operate, including Delhi. The Court was careful to hold that the IPRS principle which bars a plaintiff from suing at a distant location when the cause of action has also arisen at the principal place of business applied only in the context of Sections 134 and 62 and had no bearing on territorial jurisdiction assessed purely under Section 20 of the CPC.

On the merits, the Court’s analysis was driven by a careful and holistic reading of the OSA’s covenants. The Court found the conclusion inescapable that ITC was a service provider: the opening recitals characterised AGH as the owner of the building who sought consultancy services from ITC; Article II described ITC’s role as rendering “personal services”; Article XIX.8 expressly declared the OSA to be “a contract of personal service”; ITC was to receive a Service Fee and an Incentive Fee in consideration of services rendered; ITC was not a promoter or investor; all operating losses were borne by AGH; and ITC acted for the benefit and assistance of AGH under Article XVI. The permission to use ITC’s brands was itself one of the services rendered by ITC for consideration. This characterisation was determinative of the ownership of goodwill question.

On the date of commencement of user by AGH, the Court reasoned that Article XIII of the OSA expressly envisaged use of ITC’s trade marks by AGH even if on a permissive basis and that Clause 6 in Article XIII required the Owner to cease such use upon expiry. User under the OSA was therefore by AGH. ITC’s position that AGH’s user could only be said to commence from 2015 was therefore inconsistent with the express language of the OSA.

On goodwill, the Court applied the settled legal principle that, in a passing off action, the plaintiff must establish goodwill in the mark prior to commencement of user by the defendant. Since the DAKSHIN mark came into existence on 14 April 1989, prior to which date neither ITC nor AGH had used the mark, ITC could not establish any pre-existing goodwill. Even on the alternative analysis assuming goodwill was to be assessed as at 2015 the Court found that AGH, as the entity that bore all operating expenses and financed the Hotel’s operations, was also entitled to the benefit of the goodwill earned during the currency of the OSA, particularly given that the OSA itself provided for ITC’s goodwill being made available to AGH for the benefit of the Hotel as a service rendered for consideration. No provision in the OSA stipulated that the goodwill earned in the DAKSHIN mark would enure exclusively to ITC.

On misrepresentation and damage, the Court found no material to indicate that AGH had represented any association between its Chennai Dakshin restaurant and the ITC Dakshin chain or that any customer had been misled into believing such an association. These issues were, at the highest, triable and did not justify interim relief.

On acquiescence, the Court harmonised the competing principles from Midas Hygiene and Power Control Appliances, reiterating the position it had taken in Saurabh Gupta v. Sheopals Pvt. Ltd. and concluded that in this case the statutory bar under Section 33(1) was attracted by reason of ITC’s prolonged inaction spanning the entire period from 1989 to 2023 during which AGH openly and visibly used the DAKSHIN mark and built goodwill therein. The Court emphasised that Section 33(1) is a statutory interdict and that ITC had also not sought rectification of AGH’s Class 42 registration, thereby allowing that registration to continue unchallenged.

On copyright, the Court found that the authorship certificate pointing to Indu Balachandran as the author of the logo, combined with her status as an employee of HTA, placed first copyright ownership with HTA under Section 17(c) of the Copyright Act. The absence of any written assignment in favour of ITC as required by Section 19(1) and the limited evidentiary effect of Section 48 of the Copyright Act (which does not, unlike Section 31(1) of the Trade Marks Act, create a presumption of ownership from registration), led the Court to uphold the learned Single Judge’s finding.

DOCTRINAL SIGNIFICANCE

This judgment makes several contributions to Indian intellectual property law, each grounded in the actual holdings of the Court.

On the question of territorial jurisdiction in passing off suits involving services accessible online, the judgment confirms and extends the principle of interactive accessibility as the determinative criterion for whether a defendant “carries on business” within a court’s jurisdiction under Section 20(a) of the CPC. The Court’s holding that the availability of an “Order Online” reservation link on a third-party e-commerce platform is sufficient, at the prima facie stage, to constitute interactive accessibility regardless of whether services are physically delivered within the court’s jurisdiction represents a significant statement of the law applicable to restaurant and hospitality service disputes in the digital economy. The Court also makes a clear and useful doctrinal contribution in confining the IPRS principle to the specific context of Sections 134 and 62, thereby holding that where a passing off suit cannot invoke those provisions, territorial jurisdiction falls to be assessed on the unmodified terms of Section 20 of the CPC.

The judgment also provides a clear holding on the scope of Section 134(2) of the Trade Marks Act, confirming that the extended venue provision applies only to suits for infringement under clauses (a) and (b) of Section 134(1) and not to suits for passing off under clause (c). This is a practically important clarification for litigants seeking to choose their forum in disputes between co-proprietors of registered marks.

The Court’s treatment of the distinction between “coverage” and “goodwill” in the context of brand licensing arrangements is of significant practical value for the hotel and hospitality sector. The holding that, where an operator is a service provider working for a fee and the building owner bears all operating expenses, the goodwill earned in a brand during the service arrangement does not automatically enure exclusively to the service provider is an important doctrinal position for understanding the distribution of intellectual property rights in hotel management agreements.

The judgment also confirms the important procedural principle that, in an appeal against an interlocutory order where the Single Judge has found no territorial jurisdiction but has also pronounced on the merits, the Division Bench is entitled to consider both findings. The Court correctly applies the Wander test, declining to substitute its own view on issues where the Single Judge’s view was a possible one, while reversing the finding on territorial jurisdiction where the reasoning was found to be erroneous on principle.

It must be noted that all findings in this judgment are prima facie and interlocutory in character and none of them on territorial jurisdiction, ownership of the DAKSHIN mark, passing off, acquiescence or copyright constitute a final adjudication of the parties’ rights.

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