[Intellectual] Forum Shopping III | The Last Word


Since 2019, Courts where IPR cases are being listed in Delhi: District Judges/ADJs (Non-Commercial) for suits valued below Rs. 3 Lakhs; District Judges/ADJs (Commercial) for suits valued Between Rs. 3 Lakhs till Rs. 2 Crores; Commercial Division of High Court (Original Jurisdiction) for suits above Rs. 2 Crores.

Can District Judges (Commercial) entertain IPR suits which are valued below Rs. 3 Lakhs? Unless ‘specified value’ of a ‘commercial dispute’ is at Rs. 3 Lakhs and above, provisions of The Commercial Courts Act, 2015 would not be applicable. How such ‘specified value’ is to be examined? Opinions of various High Courts, on valuation in ‘commercial disputes’, are varied.

A perusal of Minutes of State Courts Management System Committee’s Meeting on 04.02.2020 reflects: whether a trademark suit can be valued below Rs. 3 Lakhs, ought to be left to be decided by District Judges (Commercial). Court notices, this decision may not have been uniformly implemented in District Courts.

Mere astuteness in drafting will not be allowed to stand in way of Court to look into substance of relief sought. Whimsical valuation is not permitted [Shamsher Singh v. Rajinder Prashad, (1973) 2 SCC 524]. It is Court’s duty to ensure, a reasonable estimate is provided and there is no undervaluation.

In present case, course of action appears to be quite unusual and quixotic. By merely valuing relief below Rs. 3 Lakhs, one ought not to be permitted to escape rigors of CCA or indulge in ‘forum shopping’. The practice of ‘forum shopping’ has been time and again condemned by Courts and most recently in Vijay Kumar Ghai v. State of West Bengal, [Criminal Appeal No. 463 of 2022] decided on 22.03.2022. It is thus clear to this Court, while all IPR disputes irrespective of their ‘specified value’ may not invoke provisions of CCA, there ought to be a preliminary exercise required to confirm valuation of such suits has not been done arbitrarily.

However, intention of Legislature in keeping a lower threshold in a ‘commercial dispute’ of Rs. 3 Lakhs cannot be rendered meaningless. It would only be in exceptional cases, valuation of IPR disputes below Rs. 3 Lakhs could be justified. If value of an IPR suit is below Rs. 3 Lakhs, such suits would be listed before District Judges (Commercial) first, in order to determine whether valuation is arbitrarily whimsical or deliberately undervalued. Even such suits which may be valued below Rs. 3 Lakhs shall continue to be listed before District Judges (Commercial), but may not be subjected to provisions of CCA. All pending IPR suits before different District Judges (Non-Commercial) in Delhi shall be placed before concerned District Judges (Commercial) for following procedure.

Hon’ble Justice Pratibha M. Singh of Hon’ble High Court of Delhi, Vishal Pipes Ltd. v. Bhavya Pipe Industry, [FAO-IPD 1/2022 & CM APPLs. 12-14/202] decided on 03.06.2022.

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