Sanchayita Lahkar

The High Court of Delhi Single Bench of Justice Tejas Karia has set aside a cost order imposed for delay in filing a written statement, holding that the imposition was "disproportionate to the main relief sought in the Suit". The Court directed that the delay of 48 days in filing the written statement be condoned without any cost, clarifying that the initial order fixing cost was precautionary and not binding. It further instructed that the written statement be taken on record by the Trial Court.

The matter involved a commercial intellectual property dispute filed before the learned District Judge, Commercial Court-13, Central District, Tis Hazari Courts, Delhi. The Respondent had initiated a suit against the Petitioner alleging trademark and copyright infringement, passing off, and damages amounting to ₹2,50,000, objecting specifically to the packaging used by the Petitioner and its descriptive use of the term “MISWAK”.

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Summons were issued on 18.07.2024 and made returnable on 07.08.2024. The Petitioner was served with the summons on 05.08.2024 and appeared on 07.08.2024. On the same date, the Trial Court passed an order directing that the written statement be filed within 30 days. The order further stated that any delay would attract a cost of ₹25,000 per day, and that this direction regarding cost was final and not subject to reduction.

Subsequently, the Petitioner discovered that another suit involving similar issues had been filed by the Respondent before the learned Saket Court (CS COMM 73/2024). Settlement discussions were ongoing in both matters, which led the Petitioner to delay the filing of the written statement.

When the matter was listed before the Trial Court on 27.09.2024, the Petitioner submitted that they were exploring an amicable resolution, prompting the court to adjourn proceedings to 25.10.2024. In the interim, the Saket Court listed that matter for 20.11.2024 to allow settlement discussions to proceed.

To prevent procedural complications in the event settlement talks failed, the Petitioner filed the written statement on 25.10.2024, along with an application seeking condonation of delay of 48 days. The application detailed the settlement efforts and included relevant order sheets from the Saket Suit.

The Trial Court, in its order dated 25.10.2024, acknowledged the filing and directed the Respondent to file replies in advance. However, a Transfer Notification dated the same day resulted in the replacement of the Presiding Officer, and the matter was reassigned.

The reassigned judge transferred the suit again on 16.01.2025 due to personal reasons. When the matter came up on 06.02.2025, the Respondent had not filed a reply to the Petitioner’s application. Despite the absence of a rebuttal, the Trial Court allowed the application for condonation of delay but imposed a cost of ₹25,000 per day of delay, amounting to a total of ₹12,00,000.

The Petitioner, aggrieved by the Second Impugned Order dated 06.02.2025, filed the current petition under Article 227 of the Constitution of India before the Delhi High Court.

Justice Tejas Karia observed, "The Second Impugned Order has been passed without considering the averments made in the Application and only relying on the First Impugned Order". The Court scrutinised the rationale behind the Trial Court’s action, stating that it was not justified in treating the earlier cost direction as binding.

The judgment recorded, "The First Impugned Order was passed peremptorily on the first date of appearance of the Petitioner. At the time of passing of the First Impugned Order, there was no delay... The said Order was precautionary and deterrent in nature and not a penalty imposed upon the Parties."

In evaluating the fairness of the cost imposed, the Court stated, "The Second Impugned Order... resulted in imposition of the cost amounting to ₹12,00,000/- upon the Petitioner, whereas the Respondent’s main relief in the Suit was payment of ₹2,50,000/- by way of damages." The Court termed the cost "disproportionate" in light of the relief sought.

Further, the Court noted that "the delay in filing of the Written Statement is only 48 days and well within the outer limit of 120 days as prescribed" and that the delay was justified due to ongoing settlement efforts.

Addressing the failure to consider changed circumstances, the judgment remarked, "Any application filed by the parties has to be decided on its own merits, independently, and without being influenced or bound by the previous orders passed by the same court... It is incumbent upon the Court to examine the facts and submissions without being influenced by the previous orders passed in a different context."

The Court stated that "when the Respondent had not even filed Reply to the Application and had not raised any objection thereto, the learned Trial Court ought to have considered the fact that the Parties were exploring the possibility of settlement".

The judgment added, "The Court should always encourage the settlement between the parties and if the parties are exploring the possibility of amicable settlement, the Court should always accommodate and grant time to the parties in accordance with law."

The Court explicitly held, "The First Impugned Order and the Second Impugned Order, insofar as they relate to the imposition of cost for delay in filing of the Written Statement are set-aside."

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The final direction issued by Justice Tejas Karia reads: "Accordingly, the present Petition is allowed, and it is directed that the delay in filing the Written Statement to the Suit is condoned without payment of any cost by the Petitioner to the Respondent."

It further directed: "The Written Statement shall be taken on record by the learned Trial Court." The application stood disposed of and no further costs were imposed.

Advocates Representing the Parties:

For the Petitioner: Mr. Neeraj Grover, Ms. Harshita Chawla, Mr. Angad Deep Singh & Ms. Mohona Sarkar, Advocates
For the Respondent: Mr. Mohd. Sazid Rayeen & Mr. Avijit Sharma, Advocates

Case Title: VI-JOHN HEALTHCARE INDIA LLP versus DABUR INDIA LIMITED
Neutral Citation: 2025: DHC:6269
Case Number: CM(M)-IPD 15/2025
Bench: Justice Tejas Karia