A. Commercial Courts Act, 2015 — S. 12A — Mandatory pre-institution mediation — Exception — “contemplates any urgent interim relief” — Scope — Continuing intellectual property infringement — Mere delay does not negate urgency — Urgency viewed from standpoint of plaintiff — Public interest relevance
Section 12A is mandatory; however, exemption applies where plaint and accompanying material, on a wholesome reading, disclose a real and immediate need for urgent interim intervention. In cases of continuing infringement of intellectual property rights, urgency is inherent in the persistence of the wrongful acts causing recurring and aggravating harm to business reputation, goodwill and proprietary rights. Delay in filing suit does not legalise infringement or defeat injunction relief when infringement continues.
Courts must assess urgency not on merits of interim relief, but from plaintiff’s standpoint, considering immediacy of peril and irreparable harm. Requirement of mediation cannot be used to protect infringer by procedural formality. Public interest in preventing deception of consumers reinforces urgency.
Patil Automation (2022) 10 SCC 1; Yamini Manohar (2024) 5 SCC 815; Dhanbad Fuels (2025) SCC OnLine SC 1129, relied on and explained.
(Paras 17–25)
B. Civil Procedure Code, 1908 — O. VII R. 11 and O. VII R. 10 — Rejection/return of plaint — Non-compliance with S. 12A when urgent relief genuinely contemplated — Impermissibility
Where urgent interim relief is genuinely contemplated within S.12A exception, the plaint cannot be rejected under O.VII R.11 CPC for want of pre-institution mediation. High Court erred in treating lapse of time as negation of urgency in ongoing infringement action.
(Paras 21, 24–25)
C. Intellectual Property Rights — Patent and design infringement — Continuing wrong — Recurring cause of action — Delay — Effect
Each infringing manufacture or sale constitutes a fresh wrong and recurring cause of action. Delay in initiating suit does not legalise dishonest appropriation of proprietary rights nor bar injunction.
Midas Hygiene (2004) 3 SCC 90, affirmed.
(Paras 22–23)
D. Market confusion and consumer deception — Public interest — Relevance to urgency
Imitation of patented/branded products harms not only rights holder but also marketplace integrity and consumer trust — public interest becomes a factor heightening urgency in injunction suits under S.12A exception.
(Para 23)
E. Result
Impugned orders rejecting plaint set aside. Commercial Suit restored for adjudication on merits.
(Paras 26–28)2025 INSC 1256
1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. OF 2025
(@ OUT OF S.L.P. (C) NO. 2753 OF 2025)
NOVENCO BUILDING AND INDUSTRY A/S …APPELLANT
VERSUS
XERO ENERGY ENGINEERING
SOLUTIONS PRIVATE LTD. & ANR. …RESPONDENTS
JUDGMENT
ALOK ARADHE, J.
Leave granted.
2. The appeal calls for determination of the expression
‘contemplates any urgent interim relief’ in Section 12A of the
Commercial Courts Act, 2015 (hereinafter, referred to as ‘the Act’)
2
in its application to an action for infringement of intellectual
property rights.
3. This appeal is directed against the judgment dated
13.11.2024 in Commercial Appeal No. 1 of 2024 passed by
Division Bench of the High Court of Himachal Pradesh, by which
it has dismissed the appeal of the appellant and has affirmed the
order dated 28.08.2024 in Commercial Suit No. 13 of 2024 by a
learned Single Judge, rejecting the plaint of the appellant for
non-compliance with Section 12A of the Act.
FACTUAL MATRIX:-
4. Facts giving rise to filing of this appeal can be summarised
as under :-
The appellant is a Danish company incorporated under the
laws of Denmark. The appellant is engaged in manufacture of
highly efficient industrial fans, marketed under the Brand
‘Novenco ZerAx’. According to the appellant, the said brand was
developed after an investment of approximately 3.66 million
euros between 2007 and 2015. The appellant secured several
3
patents and design registrations to secure its innovation in India
and abroad.
5. A dealership agreement was executed on 01.09.2017
between the appellant and respondent No.1, Xero Energy
Engineering Solutions Pvt. Ltd., Hyderabad (hereinafter, referred
to as ‘Xero Energy’), for marketing and sale of Novenco ZerAx
fans across India. According to the appellant, Xero Energy’s
Director, in violation of distribution agreement, incorporated
respondent No.2, Aeronaut Fans Industry Pvt. Ltd. (hereinafter,
referred to as ‘Aeronaut Fans’), for manufacture and sale of
identical fans under deceptively similar name and appearance.
The appellant discovered sometime in July, 2022 that Xero
Energy started marketing competing products.
6. The appellant sent multiple communications to Xero Energy
on 22.08.2022, 30.08.2022 and 14.10.2022 seeking clarification.
However, no explanation was offered by Xero Energy. The
appellant on 14.10.2022 terminated the dealership. Thereafter, it
sent a cease-and-desist notice dated 23.12.2022 to Aeronaut
Fans, who sent replies dated 01.02.2023 and 03.03.2023 to the
notice. Aeronaut Fans filed a petition under Section 148A CPC
4
before the Madras High Court and an email was sent on
15.05.2023 by counsel of Aeronaut Fans.
7. The technical expert of the appellant on 06.12.2023
inspected the fans installed by Aeronaut Fans at Cavendish
Industries and Hero Moto Corp, Uttarakhand, and submitted his
affidavit on 06.02.2024 confirming the infringement by Aeronaut
Fans. The appellant thereafter obtained patent and design
certificates in March-May, 2024.
8. The appellant on 04.06.2024 filed a commercial suit,
namely, COMS No. 13 of 2024, before the High Court alleging
infringement of its patent and design by the respondent. The
appellant along with the plaint also filed an application under
Order XXXIX Rules 1 and 2 seeking an ad interim injunction,
and an application under Section 151 of the CPC seeking
exemption from pre-institution mediation as mandated under
Section 12A of the Act.
9. The respondents filed an application under Order VII Rule
10 of the CPC for return of the plaint and an application under
Order VII Rule 11 for rejection of the plaint, inter alia, on the
ground that no urgency was involved in the matter and non-
5
compliance with Section 12A of the Act was fatal to the suit. The
respondents also filed a reply to the application seeking
injunction.
VIEWS OF HIGH COURT:-
10. The learned Single Judge of the High Court passed two
separate orders on 28.08.2024. By the first order, the learned
Single Judge rejected the plea for return of plaint. However, by
the second order, the learned Single Judge held that (i) there was
a delay of six months between the inspection of fans installed by
Aeronaut Fans, in December 2023 and the filing of the suit in
June, 2024, (ii) the plea of the appellant about urgency was not
substantiated as the appellant had issued cease-and-desist
notice as early as December 2022 and had adequate time to
approach for mediation, (iii) pre-institution mediation under
Section 12A of the Act is mandatory, unless urgent interim relief
is sought bonafide, (iv) in the absence of genuine urgency, the
plaint was liable to be rejected under Order VII Rule 11 of CPC.
The learned Single Judge, therefore, allowed the application
under Order VII Rule 11 of CPC and rejected the plaint.
6
11. The appellant preferred an appeal. A Division Bench of the
High Court, by an order dated 13.11.2024, agreed with the
reasons assigned by the learned Single Judge. The Division
Bench, inter alia, held that delay between inspection of fans and
filing of the commercial suit exhibits patent lack of urgency and
exemption from requirement of compliance of the mandate
contained in Section 12A of the Act cannot be claimed merely
because interim reliefs were sought. It was further held that
mere continuous infringement of intellectual property rights
could not override the statutory mediation requirements. The
Division Bench, however, clarified that the order of rejection of
the plaint would not bar the appellant in case it chooses to
comply with Section 12A of the Act and subject to the outcome of
the mediation proceeding and if the cause of action still survives,
it may institute a suit. Accordingly, the Division Bench dismissed
the appeal. In the aforesaid factual background, this appeal
arises for our consideration.
12. A Bench of this Court, by an order dated 07.02.2025, while
entertaining the Special Leave Petition, directed the appellant to
move a letter before the mediation centre attached to High Court
7
of Himachal Pradesh, seeking appointment of a mediator and the
respondents were directed to participate. It is stated before us
that, on 23.06.2025 the mediation between the parties has failed.
SUBMISSIONS:-
13. Learned senior counsel for the appellant submitted that the
learned Single Judge and the Division Bench of the High Court
erred in not applying the correct test in deciding whether the
appellant would be entitled to an interim injunction based on
urgency involved in the facts of the case. It is further submitted
that it ought to have been appreciated that the urgent interim
relief was not sought to bypass the statutory mandate of prelitigation mediation. It is also submitted that the plaint along
with the documents have to be read together to find out whether
any urgent interim relief is correctly sought. It is contended that
mere delay in filing the suit for infringement and injunction
against continuing violation of intellectual property rights by
itself is not a ground to decline the injunction against an
infringer. In support of the aforesaid submissions, reliance has
been placed on the decisions of this Court in Midas Hygiene
8
Industries Private Ltd. & Anr. v. Sudhir Bhatia & Ors.1 and
Yamini Manohar v. T.K.D. Keerthi2
.
14. On the other hand, learned senior Counsel for the
respondents, while inviting the attention of this Court to the
order dated 07.02.2025 passed in this appeal submitted that, it
appears that the issue, which according to the court arises for
consideration is whether the plaint, which did not contemplate
urgent relief, should be rejected or be kept in abeyance. It is
submitted that the learned Single Judge as well as the Division
Bench have rightly found that the plaint does not make out any
need for urgent relief. It is submitted that, in the plaint there is
not a single word on the urgency. It is contended that the
appellant had issued a cease-and-desist notice on 23.12.2022
and thereafter had filed the suit after a delay of one and half
years, in June, 2024. It is pointed out that the suit was filed after
four months of the submission of expert opinion. Therefore, there
was no urgency to deviate from the mandatory statutory
requirement under Section 12A of the Act. It is urged that mere
1
(2004) 3 SCC 90
2
(2024) 5 SCC 815
9
filing of an application for interim relief does not ipso-facto
indicate urgency and there is no material on record to suggest
that appellant’s patent is being violated. It is, therefore,
submitted that the appeal is liable to be dismissed.
STATUORY PROVISION :-
15. Before dealing with the rival submissions canvassed on
either side, we must take note of relevant statutory provision. The
Act has been enacted, inter alia, with an object for early
resolution of commercial disputes so as to create a positive image
amongst the investors about our strong and responsive legal
system and to facilitate ease of doing business. The Act was
amended in the year 2018 by Act No. 28 of 2018. By the
aforesaid amending Act, Section 12A was also incorporated with
an object to provide for compulsory mediation before initiation of
a suit where no urgent interim relief is contemplated.
16. Section 12A of the Act reads as under :-
“12A. Pre-Institution Mediation and
Settlement — (1) A suit, which does not
contemplate any urgent interim relief
under this Act, shall not be instituted
unless the plaintiff exhausts the remedy of
pre-institution mediation in accordance
10
with such manner and procedure as may
be prescribed by rules made by the Central
Government.
(2) The Central Government may, by
notification, authorise the Authorities
constituted under the Legal Services
Authorities Act, 1987 (39 of 1987), for the
purposes of pre-institution mediation.
(3) Notwithstanding anything contained in
the Legal Services Authorities Act, 1987,
the Authority authorised by the Central
Government under sub-section (2) shall
complete the process of mediation within a
period of three months from the date of
application made by the plaintiff under
sub-section (1):
Provided that the period of mediation
may be extended for a further period of
two months with the consent of the
parties:
Provided further that, the period
during which the parties remained
occupied with the pre-institution
mediation, such period shall not be
computed for the purpose of limitation
under the Limitation Act, 1963 (36 of
1963).
(4) If the parties to the commercial dispute
arrive at a settlement, the same shall be
reduced into writing and shall be signed by
the parties to the dispute and the
mediator.
(5) The settlement arrived at under this
section shall have the same status and
effect as if it is an arbitral award on agreed
11
terms under sub-section (4) of section 30
of the Arbitration and Conciliation Act,
1996 (26 of 1996).]”
Thus, the aim and object of Section 12A is to ensure that,
before a commercial dispute is filed before the court, the
alternative means of resolution of the dispute are adopted, so
that only the most trying cases come before the courts.
PRECEDENT:-
17. The scope and ambit of Section 12A of the Act which makes
pre-institution mediation mandatory for commercial disputes,
except where the suit ‘contemplates any urgent interim reliefs’,
has been considered in three recent decisions of this Court. In
Patil Automation Pvt. Ltd. v. Rakheja Engineers Pvt. Ltd.3
, a
two-Judge Bench of this Court dealt with a case where a suit for
recovery of money was filed without adherence to Section 12A of
the Act. It was held that Section 12A of the Act is mandatory and
any suit instituted in violation of the mandate contained in
Section 12A of the Act must be visited with rejection of the plaint.
3
(2022) 10 SCC 1
12
18. In Yamini Manohar (supra), another two-Judge Bench of
this Court laid down the criteria to judge whether the plaint
contains a prayer for urgent interim relief, by taking into account
the subject matter of the suit, the cause of action and the prayer
for interim relief. It was further held that the facts and
circumstances of the case have to be considered holistically from
the standpoint of the plaintiff and the prayer for urgent interim
relief should not be a disguise or mask to wriggle out of and get
over Section 12A of the Act. The scope and ambit of the words
‘contemplate any urgent interim relief’ in Section12A of the Act,
with reference to the suit, were also considered and it was held
that the plaint, documents, and facts should show and indicate
the need for urgent interim relief. It was further held that this is
the precise and limited exercise that the Commercial Courts will
undertake.
19. In DHANBAD FUELS (P) LTD. v. UOI4
, another two-Judge
Bench of this Court held that the test under Section 12A is not
whether the prayer for urgent interim relief actually comes to be
allowed or not, but whether on examination of the nature and the
4
( 2025) SCC Online SC 1129
13
subject-matter of the suit and the cause of action, the prayer for
urgent interim relief by the plaintiff could be said to be
contemplable when the matter is seen from the standpoint of the
plaintiff. It has been further held that the interim relief must not
merely be an unfounded excuse by the plaintiff to bypass the
mandatory requirement of Section 12A of the Act.
20. The legal test distilled from the aforesaid decisions for the
purposes of rejection of the plaint and for adjudication of interim
relief can be culled out as follows:
(i) Section 12A mandatorily requires pre-institution mediation
for commercial suits, non-compliance of which would
ordinarily render the plaint institutionally defective.
(ii) A plaintiff can be exempted from the requirement of Section
12A only when the plaint and the documents attached with
it clearly show a real need for urgent interim intervention. A
wholesome reading of the plaint and the material annexed to
the plaint ought to disclose the need for urgent relief.
(iii) The court must look at the plaint, pleadings and supporting
documents to decide whether urgent interim relief is
14
genuinely contemplated. The court may also look for
immediacy of the peril, irreparable harm, risk of losing
rights/assets, statutory timelines, perishable subject-matter,
or where delay would render eventual relief ineffective.
(iv) A proforma or anticipatory prayer for urgent relief used as a
device to skip mediation will be ignored and the court can
require the parties to comply with Section 12A of the Act.
(v) The court is not concerned with the merits of the urgent
relief, but if the relief sought seems to be plausibly urgent
from the standpoint of the plaintiff the court can dispense
with the requirement under Section 12A of the Act.
ANALYSIS
21. Thus, the question whether a suit ‘contemplates any urgent
interim relief’ needs to be examined on the touchstone of the
aforementioned criteria. The issue which arises for consideration
in this appeal is whether a suit alleging continuing infringement
of patent and design rights, accompanied by a prayer for interim
injunction, can be said to contemplate urgent relief within the
15
meaning of Section 12A of the Act, notwithstanding certain delay
in its institution.
22. The subject matter of the present action is continuing
infringement of intellectual property. Each act of manufacture,
sale, or offer for sale of the infringing product constitutes a fresh
wrong and recurring cause of action. It is well settled in law that
mere delay in bringing an action does not legalise an
infringement and the same cannot defeat the right of the
proprietor to seek injunctive relief against the dishonest user5.
The appellant has pleaded that Xero Energy, its former
distributor, has dishonestly appropriated its proprietary designs
and patents to manufacture and market identical fans under
deceptively similar name. The accompanying material
demonstrates that such infringing activity is continuing and
causing immediate and irreparable harm to the appellant’s
business reputation, goodwill and proprietary rights.
23. From the standpoint of the appellant, each day of
continuing infringement aggravates injury to its intellectual
property and erodes its market standing. The urgency, therefore,
5Midas Hygiene Industries Private Ltd. & Anr. (supra)
16
is inherent in the nature of the wrong and does not lie in the age
of the cause but in the persistence of the peril. The court cannot
be unmindful of the fact that intellectual property disputes are
not confined to the private realm. When imitation masquerades
as innovation, it sows confusion among consumers, taints the
market place and diminishes faith in the sanctity of the trade.
The public interest, therefore, becomes the moral axis upon
which the urgency turns. Therefore, the public interest element,
need to prevent confusion in the market and to protect
consumers from deception further imparts a colour of immediacy
to the reliefs sought.
24. The appellant’s prayer for injunction cannot be
characterised as mere camouflage to evade mediation. It is a real
grievance founded on the continuing nature of infringement and
irreparable prejudice likely to be caused by the delay. The court
must look beyond time lag and evaluate the substance of the plea
for interim protection. The insistence of pre-institution mediation
in a situation of ongoing infringement, in effect, would render the
plaintiff remediless allowing the infringer to continue to profit
17
under the protection of procedural formality. Section 12A of the
Act was not intended to achieve such kind of anomalous result.
25. The learned Single Judge as well as the Division Bench of
the High Court erred in construing the test for urgent relief
enumerated in Section 12A of the Act, in as much as the courts
have proceeded to examine the entitlement of the appellant to
urgent relief based on the merits of the case rather than looking
at the urgency as is evident from the plaint and the documents
annexed thereto from the standpoint of the plaintiff. The High
Court has proceeded on the premise that lapse of time between
the appellant’s discovery of infringement and filing of suit
negated the element of urgency. Such an approach, in our
considered view, is contrary to the principles laid down by the
decisions of this Court. The High Court has also failed to take
into account that the present action is one of the continuous
infringement of intellectual property.
CONCLUSION
26. For the reasons stated above, we hold that (i) In actions
alleging continuing infringement of intellectual property rights,
urgency must be assessed in the context of the ongoing injury
18
and the public interest in preventing deception, (ii) Mere delay in
institution of a suit by itself, does not negate urgency when the
infringement is continuing.
27. For the aforementioned reasons, the impugned judgment
dated 28.08.2024 of the learned Single Judge in Commercial Suit
No. 13 of 2024 and the judgment dated 13.11.2024 of the
Division Bench of the High Court in Commercial Appeal No.1 of
2024 are quashed and set aside. The Commercial Suit No. 13 of
2024 is restored to the file of the High Court to be proceeded with
on merits in accordance with law.
28. The appeal is allowed.
……………….……………J.
[SANJAY KUMAR]
.…….…………………….J.
[ALOK ARADHE]
NEW DELHI,
OCTOBER 27, 2025.
