Kiran Raj

The Calcutta High Court Single Bench of  Justice Krishna Rao, adjudicated a legal dispute concerning the use of the trade name "Sindharam Sanwarmal" in a family-run business dealing in dry fruits, spices, and related products. The court dismissed the plaintiff's suit seeking an injunction against the defendant, citing issues of maintainability and jurisdiction. The dispute cantered on whether the defendant’s use of the trade name within a specific geographical limit breached a prior family agreement and whether such an agreement was enforceable under the law.

The dispute arose between members of the Agarwal family regarding the right to use the trade name "Sindharam Sanwarmal." The plaintiff sought an interim order restraining the defendant from using this trade name within a one-kilometre radius of his existing shop, arguing that such usage was in violation of a family agreement executed on January 13, 2017.

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The plaintiff submitted that the business was initially founded by Mangi Lal Agarwal, and over time, it acquired substantial goodwill in the market. His five sons joined the business under the name "Sindharam Sanwarmal & Co.," expanding its reach across various locations in India. Upon Mangi Lal Agarwal’s demise in 2006 and the passing of his wife in 2016, disputes arose among the heirs regarding the business structure and its ownership.

To address these disputes, a family agreement was executed, under which specific shop spaces were allotted to different branches of the family. The agreement permitted all branches to use the "Sindharam Sanwarmal" name but imposed a restriction preventing any branch from establishing a new shop using the name within a one-kilometer radius of an existing store. The plaintiff, whose shop was named "Sindharam Sanwarmal," claimed that the defendant’s renaming of his store from "Shree Hanuman Stores" to "Sindharam Sanwarmal Mewawala" breached this agreement.

The defendant contended that the trade name "Sindharam Sanwarmal" was a joint family asset and could not be monopolized by the plaintiff. He argued that he had been conducting business under the name "Sindharam Sanwarmal Mewawala" since 2017 and had obtained legal registrations, including a Goods and Services Tax (GST) registration and a municipal enlistment certificate. The defendant also argued that the plaintiff’s claim was barred by delay, asserting that the plaintiff failed to take timely legal action when he began using the trade name in 2017.

The defendant further claimed that the family agreement could not bind him, as he was not a signatory to the agreement despite being a major at the time of its execution. He also pointed out that the plaintiff himself had not fulfilled several obligations under the agreement, such as handing over possession of allotted godowns and registering necessary property documents.

The court examined whether the family agreement was enforceable against the defendant. It observed:

"Though the defendant has taken a specific stand that the Family Agreement is not binding upon him as he is not the signatory of the Family Agreement and at the time of execution of the Family Agreement, the defendant was a major. On the other hand, the defendant is enjoying the shop room on the ground floor... which is one of the properties allotted to his father in the Family Agreement."

The court noted that the defendant had continued using the trade name for over five years without any legal challenge from the plaintiff. The judgment recorded:

"The plaintiff had knowledge that the defendant is using the aforesaid mark but the plaintiff chose not to take any steps against the defendant till March, 2023... Failing to take appropriate steps within a reasonable time, the plaintiff acquiesced to the said act of the defendant."

Regarding the enforceability of the family agreement, the court stated that the defendant could not selectively accept benefits under the agreement while rejecting its obligations. It noted:

"The defendant cannot say at one time that the Family Agreement is not binding upon him and on the other hand, the defendant is taking the benefit of the shop room allotted to his father in the Family Agreement and also taking the plea that the other godowns as mentioned in the Fourth Schedule were not handed over to the defendant."

The court addressed the limitation issue raised by the defendant, stating that whether the plaintiff had knowledge of the defendant’s usage of the trade name in 2017 and whether his claim was barred by limitation were factual matters that could not be decided summarily.

Further, the court examined whether the suit fell under the jurisdiction of the commercial courts. It stated:

"The defendant is using the trademark 'Sindharam Sanwarmal Mewawala' and is exclusively using the said premises for the purpose of business, thus, the case is totally covered in Clause (vii) and (xvii) of Section 2(1)(c) of the Commercial Courts Act, 2015."

It observed that the dispute involved agreements relating to immovable property used for trade purposes and issues concerning trademark rights, both of which fell within the purview of the Commercial Courts Act, 2015.

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The court concluded that it lacked jurisdiction to hear the case and directed that the suit be filed before the appropriate commercial court. It stated:

"The suit filed by the plaintiff is not maintainable before this Court. Accordingly, the plaint is returned to the plaintiff with the liberty to file the same before the appropriate court."

As a result, the plaintiff’s application for an interim injunction (GA No. 1 of 2023) was dismissed, and the defendant’s application for dismissal of the suit (GA No. 2 of 2023) was allowed.

Advocates Representing the Parties

 For the Plaintiff: Mr. Sabyasachi Choudhury, Sr. Adv., Mr. V.V.V. Sastry, Mr. Rahul Poddar, Advocates

 For the Defendant: Mr. Ranjan Bachawat, Sr. Adv., Mr. Anuj Singh, Mr. Sourojit Dasgupta, Mr. Shayak Mitra, Ms. Niharika Singh, Ms. Rupal Singh, Mr. Ashok Kumar Singh, Advocates

Case Title: Ramji Lal Agarwal v. Sourav Agarwal
Case Number: CS No. 126 of 2023
Bench: Justice Krishna Rao

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