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HC upholds Territorial jurisdiction is decided by the averments made in the plea and not by the plea taken in the written statement

Karans Gurukul Classes & Ors vs Gurukul Classes IIT Division & Ors

In this case, Karan Gurukul Classes has filed for permanent injunction restraining infringement of device trade mark “Gurukul Classes” and passing off by the defendants of their same business by adopting the mark “Gurukul Classes IIT Division”.

During the arguments, territorial jurisdiction of Delhi High Court was challenged. Defendants relied on the judgment of the judgment passed by the Division Bench of Delhi High Court in Ultra Home Construction Pvt. Ltd. v Purshottam Kumar Chaubey  (227 (2016) DLT 320) wherein the HC held that in this judgment that plaintiffs are disentitled from invoking jurisdiction under Section 134 of the Trade Marks Act on the basis of its own office or principle office being at Delhi.

Hence, Delhi High Court held that place where the plaintiffs as well as the defendants carry on business is the place where they are imparting coaching.

Further, on analyzing whether plaintiff can be said to be carrying on business at Aurangabad where the defendants are situated and/or carrying on business by having a licensee at Aurangabad.

HC observed that Plaintiff had pleaded in their plaint that Master License was issued in the State of Maharashtra to render education service under the trademark “GURUGUL CLASSES” who are based in the city of Aurangabad in Maharashtra.

Thereafter HC while citing Dhodha House v S.K. Maingi ((2006) 9 SCC 41) and Wipro Limited v Oushadha Chandrika Ayurvedic India (P) Limited (57 (1995) DLT 502) explained the additional jurisdiction vested in a suit for infringement of trade mark. Section 134(2) of the Trade Marks Act states that to sue at the place where the plaintiff “actually and voluntarily resides or carries on business or personally works for gain”. A clear distinction is made between “actually and voluntarily resides”, “carries on business” and “personally works for gain”. The words “actually and voluntarily resides” contemplate a case where the plaintiff, if a natural person, actually resides and where a juristic person like a company, has its registered office. The words “personally works for gain” connote the plaintiff, whether a natural or a juristic person, of its own carrying on business. However, the words “carries on business” would in my view connote carrying on business, whether “personally” or otherwise and which can be through an agent or through a licensee or under any other arrangement. The words “carries on business” in is not confined to only principal place of business or to the place where the plaintiff on its own carries on the business. Thus, carrying on business at a particular place through another entity even of not registered user within the meaning of Trade Marks Act would definitely amount to carrying on business at such place even if through a licensee or under some other arrangement.

Plaintiffs argues that the website of defendants is accessible at Delhi and thus Delhi High Court would have territorial jurisdiction. They also relied on the written statement where it was mentioned that they are advertising themselves on the electronic media accessible from everywhere. However, Court while citing Lok Nath Prasad Gupta v Bijay Kumar Gupta (57 (1995) DLT 502) stated that Order VII Rule 1(f) of the Civil Procedure Code requires plaintiff in a suit to plead the facts on which territorial jurisdiction of the Court is invoked. Hence, HC concluded that the question of territorial jurisdiction has to be decided by looking into the averments made in the plaint and not by the plea taken in the written statement.

Court referred to Banyan Tree Holding (P) Ltd v A. Murali Krishna Reddy (2009 SCC Online Del 3780) wherein it was held that,

“ (i) mere accessibility of the defendants‟ website in Delhi would not enable this Court to exercise jurisdiction;

(ii) a passive website, with no intention to specifically target audiences outside the State where the host of the website is located, cannot vest the forum court with jurisdiction;

(iii) it is not enough to show that the website hosted by the defendant is an interactive one; it would have to be shown that the nature of the activity indulged in by the defendant by use of the website was with the intention to conclude a commercial transaction with the website user;

(iv) the plaintiff has to show that the defendant “purposefully availed” itself of the jurisdiction of the forum court;

(v) the plaintiff must necessarily plead and show prima facie that the specific targeting of the forum state by the defendant resulted in an injury or harm to the plaintiff within the forum state;

(vi) to show that injurious effect has been felt by the plaintiffs, it would have to be shown that viewers in the forum state were specifically targeted.

In addition, HC referred to Impresario Entertainment & Hospitality Pvt. Ltd. Vs. S&D Hospitality (2018 SCC OnLine Del 6392), where it was held in the context of the business of restaurant, that though the defendant through Zomato and Dine Out will be able to invite the customer and reserve a table at the restaurant of the defendant at Hyderabad but the commercial transaction would take place only on the customer availing the service of the defendant at Hyderabad.

Accordingly, HC held that it does not have territorial jurisdiction to entertain the suit.

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