Delhi High Court Revives PADAN Trademark Suit, Warns Against Premature Rejection of Plaint Under Order VII Rule 11

Delhi High Court Revives PADAN Trademark Suit, Warns Against Premature Rejection of Plaint Under Order VII Rule 11

Introduction

The Delhi High Court set aside the rejection of a trademark suit concerning the “PADAN” mark, holding that a plaint cannot be dismissed at the threshold if it discloses a triable cause of action. The Court emphasized the limited scope of scrutiny under Order VII Rule 11 of the Code of Civil Procedure.

Factual Background

Coromandel Indag Products India Ltd. claimed long-standing use of the “PADAN” mark in India since 1988 for insecticides and pesticides, along with independently developed packaging artwork in 2006. The company asserted that it had built substantial goodwill through continuous use, with sales exceeding ₹913 crore between 2013 and 2022. It alleged that Sumitomo Chemical Company Ltd. had launched products with deceptively similar packaging, thereby infringing copyright and passing off its goods. The defendants, however, contended that they were the registered proprietors of the “PADAN” mark and that the plaintiff had no independent rights, as relevant licensing arrangements were with a related entity undergoing liquidation.

Procedural Background

A single judge of the Delhi High Court, by order dated July 3, 2025, rejected the plaint under Order VII Rule 11 CPC, holding that no cause of action was disclosed and that the claim was illusory. Aggrieved, the plaintiff preferred an appeal before the Division Bench. By judgment dated March 18, 2026, the Division Bench set aside the single judge’s order and restored the suit.

Issues

1. Whether the plaint disclosed a cause of action sufficient to survive rejection under Order VII Rule 11 CPC.

2. Whether the single judge exceeded the permissible scope of inquiry at the stage of rejection of plaint.

Contentions of Parties

The plaintiff contended that it had independently built goodwill in the “PADAN” mark through long and continuous use and that the defendants’ packaging amounted to infringement and passing off. It argued that the plaint clearly disclosed material facts constituting a cause of action. The defendants, on the other hand, submitted that they were the registered proprietors of the trademark and that the plaintiff’s rights, if any, arose only through licensing arrangements with another entity, thereby negating any independent claim.

Reasoning and Analysis

The Division Bench of Justice C. Hari Shankar and Justice Om Prakash Shukla held that while deciding an application under Order VII Rule 11 CPC, the Court must confine itself strictly to the averments in the plaint and assume them to be true. It observed that the single judge erred by examining disputed facts, considering the defence, and assessing the merits of the case at a preliminary stage.

The Court clarified that the inquiry at this stage is not whether the plaintiff will ultimately succeed but whether the plaint discloses material facts which, if proved, would entitle the plaintiff to relief. It further held that issues relating to ownership, licensing arrangements, and goodwill were all triable questions that required evidence and could not be conclusively determined at the threshold. The Bench emphasized that rejection of a plaint is a drastic power and must be exercised sparingly, only in cases where no cause of action is disclosed even on a plain reading of the plaint.

Decision

The Delhi High Court allowed the appeal, set aside the order rejecting the plaint, and restored the trademark suit for adjudication on merits.

In this case the plaintiff was represented by Senior Advocate J Sai Deepak with Advocates Shravan Kumar Bansal and Pankaj Kumar. Meanwhile the respondent was represented by Senior Advocate Rajshekhar Rao with Advocates Prashant Gupta, Aadhar Nautiyal, Karan Singh, Shivangi Kohli and Anirudh Vats.