Effects of the Commercial Courts Act and Changes made upon claims of Brand Name Infringement and Passing Off

Effects of the Commercial Courts Act and Changes made upon claims of Brand Name Infringement and Passing Off

Introduction

There has been a subsequent rise in commercial disputes both at the domestic and international levels. With immediate requirement, the Government of India imposed legal reforms for the faster resolution of issues relating to Commercial Disputes and approved the Ordinances which was replaced and enacted as the Commercial Courts, Commercial Division, and Commercial Appellate Division of High Courts Act for speedy disposal of cases.

 Commercial Courts Act, 2015

This is said to be the most significant legislation enacted by the Parliament for adjudication of commercial disputes and claims, and ensures the speedy settlement of the matters.

The State Government of all the States would be setting up such commercial courts at the District Level, and Commercial Division in the High Court having original jurisdiction,[1] providing them with powers and jurisdiction to handle the matters.  The name itself as, “Commercial Courts Act, 2015” clearly shows that different courts with separate procedures are constituted for resolving disputes.

The specified value of commercial disputes is reduced to Rs. 3,00,000/- from Rs. 1,00,00,000/- . The act also lays down proper timelines for the filing of documents and for the announcement of the judges.

After the amendment in the year 2018, mediation has been made compulsory for all disputed parties for going in, before bringing the case to court, i.e. ‘Out of court settlement’. This is regarded as a cost-effective method for solving issues.

Features of the Act

1. 3 Courts- Commercial Court, Commercial Appellate Court, and Commercial Division;
2. Deals with transactions related to monetary terms;
3. Several amendments with Civil Procedure Code, 1908;
4. Appeals time-bound and disposed of within 6 months;
5. Continuous appointment of judges;
6. Mediation to exhaust before approaching the Court;

Important provisions of Commercial Courts Act, 2015

• Section 2(1) (c) deals with the definition of Commercial Dispute whereas Section 2(1) (e) contains specified value i.e. 3 Lakh Rupees.
• Section 3 talks about State Governments to involve in the constitution of Commercial Courts, Commercial Appellate Courts, and Commercial Division to be done after consultation with respective State High Courts.
• Section 6 mentions trying all pleas within jurisdiction whereas Section 10 mentions all the pleas and appeals related to arbitration dealt with under Arbitration and Conciliation Act, 1996.
• Section 12A, 13, and 14 provide issues that are not so important should exhaust and appeals filed within 60 days and disposed of within 6 months.
• Section 16, 17, and 19 mention several amendments to Civil Procedure Code, 1908, Proper record maintenance for all cases and infrastructure of courts to be provided by respective state governments.
• Section 20 and 22 provide provisions for the Appointment of Judges and in case, any difficulty arises while implementing the act within the initial 2 years, then, Central Government will make provision for the same. 

Certain changes have been made in the Civil Procedure Code, 1908 in Section 16 of the Act. Some of the changes are-

• According to Order XI, parties are needed to file a list of all documents in their power, ownership, control, and custody relating to the suit.
• According to Order XIII A, any party can apply for summary judgment, with regards to a case that can be decided by the Court without recording oral evidence.
•  According to Order XV A, the Court should conduct the first hearing within 4 weeks from the date of filing of affidavits or denial of documents by parties, called as Case Management Hearing. Also, it provides for the collection of evidence, cross-examination, etc.
•  According to Order XX, the court should announce a final order of the case within 3 months after the completion of the arguments.

Trademark Infringement and Passing Off under the Commercial Courts Act

In the case of Guiness World Records v Sababbi Mangal[2], the Delhi High Court held that disputes related to innovation rights, filed under acts such as Patent act, Trademark act, etc. should be adjudicated by commercial courts, whether the value of the claim is above the limit of 1 Crore Rupees or not.

The disputes in relation to Trademark Infringement & Passing Off would be decided according to the proper provisions given in the Code. The act provides for a speedy settlement of the matters which is the basic requirement in all such matters because continuous use of trademark provides harm to the party who has suffered losses and seeks remedy from the court.

Further, In the Case of M Siddiq (D) Thr Lrs v. Mahant Suresh Das & Ors[3], the court ordered the said parties to go for mediation.

Amendments to the Commercial Courts Act

In 2018, several changes made to the act are-

• The specific value of matters are above the value of 3 lakh rupees;
• To resolve the disputes and settlements by way of Alternate Dispute Resolution i.e. parties should go for mediation for 3 months before filing suit to the court; (Section 12A)
• Government can appoint judges without concurrence of the Chief Justice of the High Court’s;

 Conclusion

The act has been primarily brought into the judicial system for speedy settlement of commercial disputes. The act ensures coordination among the State Governments and the High Courts. The provision of mediation has brought effectiveness in the system. The act mandates mediation. The Commercial Courts Act and its amended have completely changed the scenario of Intellectual Property Disputes.

BY:-

ANKITA MISHRA

[3] 10866-10867 of 2010