Himachal Pradesh High Court
Boehringer Ingelheim International ... vs Nexkem Biotech Pvt. Ltd. & Anr on 1 April, 2024
Author: Sandeep Sharma
Bench: Sandeep Sharma
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Civil Suit (COMS) No.25 of 2022 Reserved on : 22.03.2024 Decided on : 01.04.2024.
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___________________________________________________________ Boehringer Ingelheim International GmbH & Anr. ....plaintiffs Versus Nexkem Biotech Pvt. Ltd. & Anr. .... defendants ___________________________________________________________ Hon'ble Mr. Justice Sandeep Sharma, Judge.
Whether approved for reporting? Yes.
___________________________________________________________ For the plaintiffs Mr. Ashok Aggarwal, Senior Advocate with Dr. Sanjay Kumar, Ms. Arpita Sawhney, Mr. Atul Jhingan and Mr. Priyansh Sharma, Advocates.
For the defendants: Mr. Nitin Thakur, Advocate, for defendant No.1.
Mr. R.L. Sood,Senior Advocate with Mr. Arjun Lall, Advocate, for defendant No.2.
___________________________________________________________ Sandeep Sharma, Judge :
Plaintiffs have filed a suit for permanent prohibitory injunction restraining the defendants from infringing the patent owned by plaintiff No.1 and other consequential relief under Order 7 Rule 1 & 2 of Civil Procedure Code, 1908, read with Section 108 of Patents Act, 1970. Along with aforesaid suit, an application bearing OMP No.874 of 2022, under Order 39 Rule 1 & 2, read with Section 151 CPC also came to be filed on behalf of the plaintiffs, praying therein for ad interim injunction restraining the defendants by themselves or through their directors, partners, licensees, stockists and distributors, agents and/or ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 2 anyone claiming through any of them jointly and severally from infringing the patent rights of plaintiff No.1 under Indian Patent .
No.268846 by launching, advertising, making, using, offering for sale, selling, importing and /or exporting the medicinal product, Empagliflozin in any form whatsoever including Empagliflozin API, Empagliflozin formulation, "Empagliflozin Tablets" and/or "Empagliflozin + Metformin Hydrochloride Tablets" or any "generic version" thereof or any product sold under the trade mark(s)/name(s) "EmpaRav-10" & "EmpaRav-25"
2. Vide order dated 07.12.2022, this Court, while issuing notice to the defendants in the main suit, also passed an ad interim injunction pursuant to the prayer made by the plaintiffs through OMP No.874 of 2022, as detailed hereinabove.
3. Defendants besides filing written statement to the main suit, also filed an application bearing OMP No.1368 of 2023, under Order 39 Rule 4 CPC for vacation of interim order dated 07.12.2022, however, before aforesaid application could be decided along with other pending applications, learned counsel representing the defendants while putting appearance on 15.12.2023, submitted that they do not intend to file reply to the miscellaneous applications bearing OMP Nos.874, 875, 876 & 877 of 2022, but the defendants have a specific objection with regard to maintainability of civil suit on account of non-::: Downloaded on - 03/04/2024 20:34:24 :::CIS 3
compliance of mandate contained under Section 12-A of the Commercial Courts Act, 2015 (hereinafter referred to as 'the Act') .
4. Having taken note of the aforesaid objection with regard to maintainability, the case at hand came to be listed before this Court for consideration/dismissal of the objection as detailed hereinabove. In the aforesaid background, this Court vide instant order shall dispose of the objection qua maintainability of the suit raised by the defendants.
5. Mr. Nitin Thakur and Mr. Arjun Lall, learned counsels representing defendant No.1 and defendant No.2, while making this Court peruse the provisions contained in Section 12-A of the Act vehemently argued that since plaintiffs before filing the suit at hand, failed to exhaust remedy of pre-institution mediation and perusal of the pleadings adduced on record by the plaintiffs nowhere contemplates an urgent interim relief under the Act, suit being not maintainable, deserves outright rejection. Above-named counsels representing the defendants, while making this Court peruse averments made in the plaint as well as miscellaneous application filed under Order 39 Rule 1 & 2 CPC, attempted to persuade this Court to agree with their contention that there was no urgency, which could permit this Court to entertain the suit filed by the plaintiffs without exhausting the remedy of pre-institution mediation in terms of Section 12-A of the Act. Mr. Arjun ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 4 Lall, while making this Court peruse the provisions contained in Section 12-A of the Act as well as judgment passed on the same issue by the .
Hon'ble Apex Court, details whereof shall be given in the later part of the judgment, also argued that it is/was mandatory for the plaintiffs to specifically disclose in the pleadings urgency enabling the Court to consider the prayer, if any, made for urgent interim relief. Mr. Arjun Lall, further argued that as per own pleadings of plaintiffs, cause of action accrued in their favour on 18th September, 2015, on which date, subject patent was granted by the Controller of Patents, but the suit has been filed in the year 2022, i.e. after seven years of accrual of cause of action, meaning thereby, there was no urgency, if any, but if it was so, plaintiffs before filing the suit ought to have resorted to, pre-institution mediation, in terms of the provisions contained in Section 12-A of the Act. He further submitted that it has been nowhere averred in the plaint as well as in the application for interim relief that in case urgent interim relief, as prayed for, is not granted, irreparable loss would be caused to the plaintiffs, which cannot be compensated in any terms. Mr. Arjun Lall, further submitted that mere pleading that there is an urgency and urgent interim relief is required to be granted, may not be sufficient to come out of the provisions contained in Section 12-A of the Act, which clearly provides that before filing suit, if any, plaintiff is obliged to resort to pre-institution mediation. In support of aforesaid submission, ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 5 Mr.Arjun Lall and Mr. Nitin Thakur, learned counsels, have placed reliance on the following judgments, which shall be referred to, by this .
Court, while ascertaining correctness of rival submissions made by learned counsel representing the parties:
i) Patil Automation Private Limited v. Rakheja Engineers Private Limited, 2022 SCC OnLine 1028, passed by Hon'ble Apex Court;
ii) Proactive Ship Management Private Limited vs. Owners and Parties Interested in the Vessel Green Ocean, 2024 SCC OnLine Cal 1838, passed by Hon'ble High Court of Calcutta; and
iii) Bolt Technology OU v. Ujoy Technology Pvt. Ltd, 2022 SCC OnLine Del 2639, passed by Hon'ble High Court of Bombay.
6. While refuting the aforesaid submissions made by learned counsel representing the defendants, Mr. Ashok Aggarwal, learned Senior Counsel, duly assisted by Dr. Sanjay Kumar, Ms. Arpita Sawhney, Mr. Atul Jhingan and Mr. Priyansh Sharma, learned counsel representing the plaintiffs, forcefully submitted that the suit having been filed by the plaintiffs is maintainable and has been rightly entertained by the Court.
While fairly admitting that in terms of provisions contained in Section 12-A of the Act, a suit, which does not contemplate urgent interim relief under the provisions of aforesaid Act, cannot be instituted without resorting to pre-institution, mediation, as envisaged under Section 12-A ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 6 of the Act. Mr. Aggarwal, submitted that plaintiffs need not to first opt for pre-institution mediation in every case, rather applicability of .
appropriate provisions under Section 12-A of the Act, would vary from case to case. He submitted that in case, the suit filed under the Commercial Courts Act contemplates urgent interim relief, there is no necessity to resort to the remedy of pre-institution mediation as contained in Section 12-A of the Act. Mr. Aggarwal, submitted that very language applied in Section 12-A of the Act, clearly suggests that a suit, which contemplate urgent interim relief, can only be instituted after exhausting the remedy of pre-institution mediation, meaning thereby, party seeking to file civil suit under the Commercial Court Act without resorting to the remedy of pre-institution mediation, is required to show/establish that urgent interim relief is required to be passed, failing which, great prejudice of irreparable loss would be caused to the parties seeking such relief, which cannot be compensated in any other terms. He further submitted that if Section 12-A of the Act, is read in its entirety, it nowhere suggests that party desirous of filing civil suit in terms of the provisions contained under the Act, cannot straightway file a civil suit in the competent court of law and it is obliged to first file an application seeking exemption from resorting to the remedy of pre-
institution mediation. He submitted that though bare reading of Section 12-A of the Act, clearly suggests that onus to prove the involvement of ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 7 urgent interim relief in the case, is squarely upon the plaintiffs, but duty is also cast upon the Court to ascertain whether suit filed before it .
contemplates any urgent interim relief or not, meaning thereby, party contemplating any urgent interim relief under the Act, can file the suit straightaway without resorting to the alternate remedy as provided in Section 12-A of the Act, but while seeking interim relief, it shall be obliged to satisfy the Court that urgent interim relief is required to be passed, for the reasons as detailed in the plaint as well as documents annexed therewith. While making this Court peruse the contents of the plaint as well as application filed under Order 39 Rule 1 & 2 CPC, Mr. Aggarwal, submitted that it has been categorically stated by the plaintiffs that there is an urgent need to restrain the defendants from manufacturing, using, offering for sale, selling, importing or exporting any product covered by the subject patent and as such, it cannot be said that urgency, if any, cannot be inferred from the pleadings adduced on record by the plaintiffs.
7. While refuting the submission made by Mr. Arjun Lall, learned counsel representing the defendant No.2 qua date of cause of action, Mr. Aggarwal, made this Court read Para-47 of the plaint. He submitted that cause of action first arose in favour of the plaintiffs on 18th September, 2015, on which date, subject patent was granted to the plaintiffs by the Controller of the Patents and it continues to subsists ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 8 until defendants are not restrained from launching, making, marketing, using, offering for sale, selling, importing and/or exporting the said .
product, as detailed hereinabove. While making this Court peruse written statement filed by the defendants, Mr. Aggarwal, further submitted that infringement of the patent has been clearly admitted by the defendants and they have categorically admitted that they have been manufacturing, marketing, using, offering for sale and selling the infringing product, Empagliflozin 10 mg/25 mg tablets in carton/strip pack under the brand names, "EmpaRav-10" & EmpaRav-25". If it is so, it cannot be said that there is no cause of action which compels plaintiffs to file civil suit, maintainability of which has been however, laid challenge to. Mr. Aggarwal also placed reliance upon the judgments, which have been otherwise pressed into service by the learned counsel representing the defendants, to state that suit filed by the plaintiffs, is maintainable on account of there being involvement of urgent interim relief and as such, there was no requirement, if any, for the plaintiffs to institute pre-institution mediation prior to their having filed the suit at hand.
8. Having heard learned counsel representing the parties and perused the pleadings adduced on record by the respective parties vis-
à-vis question of maintainability of the suit raised by the defendants, ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 9 following questions fall for determination/adjudication of the case at hand:
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"i) Can civil suit, if any, in terms of provisions contained under the Commercial Courts Act, 2015, be filed in the competent court of law without availing the remedy of pre-institution mediation, as prescribed in Section 12-A of the Act?
ii) If yes, can suit be dismissed under Order 7 Rule 11(d) of Civil Procedure Code, 1908, without there being application, if any, filed by the opposite party or can court suo moto pass such order on the basis of material available r on record? and;
iii) Whether civil suit under the Commercial Courts Act, 2015, can be filed in routine manner in the competent court of law without seeking exemption from the Court to avail alternate remedy, as provided in Section 12-A of the Act?
9. Before exploring answers to the questions formulated hereinabove, it would be apt to take note of Section 12-A(1) of the Act, which reads as under:-
"12-A(1). suit, which does not contemplate any urgent interim relief under this Act, shall not be instituted unless the plaintiff exhausts the remedy of pre-institution mediation in accordance with such manner and procedure as may be prescribed by rules made by the Central Government."
10. Bare perusal of the aforesaid provision of law clearly suggests that a suit which does not contemplate urgent interim relief ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 10 cannot be instituted straightaway in the competent court of law, rather in terms of aforesaid provision plaintiff is obliged to opt for pre-
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institution mediation before instituting the suit. However, if suit contemplates urgent relief under the provisions of the Act, party can straightaway file a suit and there is no requirement of resorting to pre-
institution mediation before instituting the suit. Though, it came to be argued on behalf of the defendants that no suit can be filed under the Act straightaway in the competent court of law without obtaining dispensation of mandate by Section 12-A of the Act, at the time of institution of the suit, but after having perused the provision contained in Section 12-A of the Act, this Court is not persuaded to agree with learned counsel representing the defendants, for the reasons that bare reading of Section 12-A of the Act clearly provides that a suit, which does not contemplate urgent interim relief under the Act, shall not be instituted until plaintiffs have exhausted the remedy of pre-institution mediation with such manner, as may be prescribed in the rules made by the Central Government. If the aforesaid provision is read in its entirety, it neither reserves any liberty to the plaintiffs to seek exemption from pre-institution mediation, nor the Court can be said to have such power, rather question with regard to involvement of any urgent relief in the suit filed under the Act of 2015, is to be established by the plaintiffs through pleadings as well as documents adduced on record and the ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 11 question that whether suit contemplate any urgent interim relief, shall be decided by the Court while looking at the pleadings as well as other .
material supplied to it at the time of institution of the suit. Precisely, plaintiff must establish that he requires urgent interim relief and that urgency would be frustrated if he is relegated to mediation instead of pursuing his urgent interim relief in the suit. Court should also be satisfied after seeing the pleadings and material available adduced on record that urgent interim relief is required to be granted and in case the same is not granted, very purpose of filing the suit would be defeated.
11. Very important and relevant words used in Section 12-A is "contemplation of urgent interim relief", under the provisions of 2015 Act, which is to be determined at the time of institution of the suit, if it is so, there appears to be force in the submission of Mr. Ashok Aggarwal, learned Senior Counsel representing the plaintiffs that contemplation of urgent interim relief, if any, cannot be reserved by the plaintiffs for a later stage for the Court to examine, rather such contemplation, if any, is to be seen by the Court at the time of institution of the Suit, meaning thereby, plaintiffs cannot institute a suit, which does not call for any urgent relief and keep the suit alive for an opportunity/time to argue such interim relief. Though, it is quite apparent from the bare reading of Section 12-A of the Act that suit, which does not contemplate urgent ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 12 interim relief, shall not be instituted without resorting to the pre-
institution mediation, but now question arises that who will and what .
would decide the contemplation for urgent interim relief. The onus to prove that there is a case of urgent interim relief is on the plaintiff and same can be discharged by him by referring to the averments contained in the plaint, which forms substratum of the suit, cause of action and relief claimed. The case for urgent interim relief, must be stated and spelled out in the pleadings made in the plaint. As has been observed hereinabove, normally onus is always upon the plaintiff to prove a case for urgent interim relief, but bare perusal of language applied in Section 12-A of the Act further indicates that duty is also cast upon the Court to ascertain from the pleadings that whether plaintiff requires urgent interim relief, if any, and non-grant of the same would frustrate his suit. As per aforesaid provision of Section 12-A of the Act, Court is also empowered to decide at the time of institution of suit whether the suit contemplates an urgent interim relief, meaning thereby, contemplation of urgent interim relief under Section 12-A of the Act, is not the sole domain of the plaintiffs, rather Court after having gone through the pleadings as well as other material available on record, vis-
à-vis relief sought for, can also ascertain factum, if any, of urgent interim relief. Once plaintiff succeeds in satisfying the Court that the suit contemplates an urgent interim relief or Court after having seen ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 13 material, is satisfied that suit contemplates an urgent interim relief, onus would shift upon the defendant to establish that suit did not contemplate .
an urgent interim relief at the time of institution and thereafter Court would examine the case brought by the defendant and consider whether dispensation of mandate by Section 12-A of the Act, was wrongly granted or not. At that stage, grant or refusal of interim relief may not be relevant for deciding the issue of urgency, rather Court's finding on urgency shall be of paramount importance. If the Court comes to a specific finding either suo moto or on an application filed by the defendant that suit did not contemplate any urgent interim relief at the time of institution, Court can proceed to dismiss the suit, while exercising power under Order 7 Rule 11(d) of CPC, on the premise that suit contravened the mandate of Section 12-A of the Act. Reliance in this regard, is placed upon the judgment rendered by Hon'ble Apex Court in Patil Authomation's case (supra):
"The regime under Order 7 Rule 11CPC
92. Order 7 Rule 11 declares that the plaint can be rejected on 6 grounds. They include failure to disclose the cause of action, and where the suit appears from the statement in the plaint to be barred. We are concerned in these cases with the latter. Order 7 Rule 12 provides that when a plaint is rejected, an order to that effect with reasons must be recorded. Order 7 Rule 13 provides that rejection of the plaint mentioned in Order 7 Rule 11 does not by itself preclude the plaintiff from presenting a fresh plaint in respect of the same cause of action. Order 7 deals with various aspects about what is to be pleaded in a plaint, the documents that should accompany and other details. Order 4 Rule 1 provides that a suit is instituted by presentation of the plaint to the court or such officer as the court appoints. By virtue of Order 4 Rule 1(3), a plaint is to be deemed as duly instituted only when it complies with the requirements under Order 6 and Order 7. Order 5 Rule 1 declares that when a suit has been duly instituted, a summon may be issued to the defendant to answer the claim on a date specified therein. There are other ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 14 details in the order with which we are not to be detained. We have referred to these rules to prepare the stage for considering the question as to whether the power under Order 7 Rule 11 is to be exercised only on an application by the defendant and the stage at which it can be exercised. 94.3. Order 7 Rule 11 does not provide that the court is to discharge its duty .
of rejecting the plaint only on an application. Order 7 Rule 11 is, in fact, silent about any such requirement. Since summon is to be issued in a duly instituted suit, in a case where the plaint is barred under Order 7 Rule 11(d), the stage begins at that time when the court can reject the plaint under Order 7 Rule 11. No doubt it would take a clear case where the court is satisfied.
The Court has to hear the plaintiff before it invokes its power besides giving reasons under Order 7 Rule 12. In a clear case, where on allegations in the suit, it is found that the suit is barred by any law, as would be the case, where the plaintiff in a suit under the Act does not plead circumstances to take his case out of the requirement of Section 12-A, the plaint should be rejected without issuing summons. Undoubtedly, on issuing summons it will be always open to the defendant to make an application as well under Order 7 Rule 11. In other words, the power under Order 7 Rule 11 is available to the court to be exercised suo motu. (See in this regard, the judgment of this Court in Madiraju Venkata Ramana Raju [Madiraju Venkata Ramana Raju v. Peddireddigari Ramachandra Reddy, (2018) 14 SCC 1] .)"
12. The Honb'le Apex Court in the case titled Patil Automation Private Limited v. Rakheja Engineers Private Limited, 2022 SCC OnLine 1028, has held that Section 12-A of the Act is mandatory provision where pre-institution mediation is necessary, unless the suit contemplates urgent interim relief, relevant paras of which read as under:
"99.1. The Act did not originally contain Section 12-A. It is by amendment in the year 2018 that Section 12-A was inserted. The Statement of Objects and Reasons are explicit that Section 12-A was contemplated as compulsory. The object of the Act and the Amending Act of 2018, unerringly point to at least partly foisting compulsory mediation on a plaintiff who does not contemplate urgent interim relief. The provision has been contemplated only with reference to plaintiffs who do not contemplate urgent interim relief. The legislature has taken care to expressly exclude the period undergone during mediation for reckoning limitation under the Limitation Act, 1963. The object is clear.
99.3. The language used in Section 12-A, which includes the word "shall", certainly, goes a long way to assist the Court to hold that ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 15 the provision is mandatory. The entire procedure for carrying out the mediation, has been spelt out in the Rules. The parties are free to engage counsel during mediation. The expenses, as far as the fee payable to the mediator, is concerned, is limited to a one-time fee, which appears to be reasonable, particularly, having regard to .
the fact that it is to be shared equally. A trained mediator can work wonders.
99.4. Mediation must be perceived as a new mechanism of access to justice. We have already highlighted its benefits. Any reluctance on the part of the Court to give Section 12-A, a mandatory interpretation, would result in defeating the object and intention of Parliament. The fact that the mediation can become a non-starter, cannot be a reason to hold the provision not mandatory. Apparently, the value judgment of the lawgiver is to give the provision, a modicum of voluntariness for the defendant, whereas, the plaintiff, who approaches the court, must, necessarily, resort to it. Section 12-A elevates the settlement under the Act and the Rules to an award within the meaning of Section 30(4) of the Arbitration Act, giving it meaningful enforceability. The period spent in mediation is excluded for the purpose of limitation. The Act confers power to order costs based on conduct of the parties."
13. In this regard, reliance is also placed upon case titled Proactive Ship Management Private Limited v Owners and Parties Interested in the Vessel Green Ocean, 2024 SCC OnLine Cal 1838, in which the Hon'ble High Court of Calcutta held as under:
"10. Section 12-A makes two things clear:
a) A suit which does not contemplate urgent interim relief under the provisions of the 2015 Act cannot be instituted, unless
b) The plaintiff first opts for pre-institution mediation before instituting the suit
c) The suit can however be instituted if the plaintiff obtains dispensation of the mandate of section 12-A at the time of institution of the suit.
11. In other words, the plaintiff must establish - and the Court satisfied on such showing - that the plaintiff requires urgent interim relief and that the urgency would be frustrated if the plaintiff is relegated to mediation instead of pursuing its urgent interim relief in the suit.
12. The more significant conclusion from a plain reading of section 12-A is that contemplation of urgent interim relief under the provisions of the 2015 Act is a matter which is to be determined at the time of institution of the suit. The contemplation is not one which the plaintiff can reserve for a later stage for the Court to examine. The specific words of section 12-A are ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 16 ".... does not contemplate any urgent interim relief....shall not be instituted..."
meaning thereby that the plaintiff cannot institute a suit which does not call for any urgent interim relief and keep the suit alive for an opportune time to .
argue such interim relief.
13. The mandate of section 12-A of pre-institution mediation in the absence of any urgent interim relief becomes even more clear from the words "a suit/which does not contemplate any urgent interim relief... shall not be instituted...". Hence, the plaintiff does not have the option of any later or subsequent contemplation of urgent interim relief post institution of the suit. To reiterate one last time, a suit which does not contemplate urgent interim relief shall not be instituted without resorting to pre-institution mediation. Period."
14. In Bolt Technology OU v. Ujoy Technology Pvt. Ltd, 2022 SCC OnLine Del 2639, while placing reliance on a judgment of Hon'ble High Court of Bombay, court observed:
"13. Similarly, with regards to the object of Section 12-A, the Division Bench of the Bombay High Court in Deepak Raheja v. Ganga Taro Vazirani [Deepak Raheja v. Ganga Taro Vazirani, 2021 SCC OnLine Bom 3124] has also observed as under:
"4. The scheme of Section 12-A of the Act (reproduced earlier) is thus. A commercial suit of the specified value that does not contemplate any urgent interim relief shall not be instituted unless the party exhausts the remedy of pre-institution mediation in accordance with such manner and procedure as may be prescribed by rules. The Central Government will authorise the authorities constituted under the Legal Services Authorities Act, 1987 for the purposes of pre-institution mediation. The mediation process is to be completed within a period of three months from the date of application. The period may be extended for a further period of two months with the consent of the parties. The period of pre-institution mediation shall not be computed for the purpose of limitation under the Limitation Act, 1963, and Section 12-A(3) excludes the period taken for mediation from the limitation period for filing the suit. Under this Section, the settlement arrived at shall have the same status and effect as if it is an arbitral award under Arbitration and Conciliation Act, 1996.
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19. Section 12-A was introduced by way of Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Act, 2018. The Statement of Objects of the ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 17 (Amendment) Act, 2018 generally stated that the global economic environment has since become increasingly competitive and to attract business at the international level, India needs to further improve its ranking in the World Bank's 'Doing Business Report', which, inter alia, considers the dispute resolution environment in the .
country as one of the parameters for doing business. It referred to the economic development, which has prompted initiating legislative measures for speedy settlement of commercial disputes. Early resolution of commercial disputes even of lesser value will create a positive image amongst the investors about the Indian legal system. The object was also to reduce the specified value of commercial disputes and constitute commercial courts at the district level. As regards the introduction of Section 12-A, the statement of objects and reasons specifically stated as follows:
(v) To provide for compulsory mediation before institution of a suit, which no urgent interim relief is contemplated and for this purpose, to introduce the pre-
institution mediation and settlement mechanism and to enable the Central Government to authorise the authorities constituted under the Legal Services Authorities Act, 1987 r for this purpose.
(emphasis supplied) ∗∗∗
26. Section 12-A does not come into play if the suit contemplates an urgent relief. If a commercial suit (of specified value) contemplates urgent relief, it can be instituted in the court straightaway. Therefore, two classes of commercial disputes are contemplated under Section 12-A. One in which an urgent interim relief is not contemplated and second where urgent interim relief is contemplated. Section 12-A provides different schemes for these two classes of disputes. Where there is no urgent interim relief to first exhaust the remedy of pre-institution mediation. Where there is an urgent interim relief contemplated to approach the court directly. The emphasis is that for a particular type of dispute particular kind of remedy is more appropriate. Section 12-A segregates commercial disputes depending on their urgency. Making segregation at the inception of a commercial dispute is a considered legislative instrument to speed up the disposal of commercial disputes. Court adjudication is not the only type of dispute resolution mechanism. Negotiations and mediation also resolve the dispute by finding a mutually acceptable solution. The parties can negotiate themselves or through a private person or machinery provided under the statute. Once the authority conducts the mediation under Section 12-A, the mutually acceptable outcome can be enforced like an arbitral award. For some disputes with urgent interim reliefs, adjudication in courts can be a suitable remedy, while for some disputes, resolution through mediation can be more appropriate. Section 12-A is recognition of this fact by the legislature. A clear legislative intent emerges from the plain reading of Section 12-A that commercial dispute which contemplates an urgent interim relief, dispute ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 18 resolution by courts is primary, when there is no such interim relief contemplated, pre-institution mediation for mutual resolution of disputes to be attempted first should be appropriate."
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15. It is quite apparent from the aforesaid explanation laid down by Hon'ble Apex Court that institution of the suit, which does not contemplate an urgent interim relief without exhausting the remedy of pre-institution mediation under Section 12-A of the Act, would fall under the statutory bar of Order 7 Rule 11(d) of the CPC. Hence, Court can treat the contravention with the fold of Order 7 Rule 11(d) of CPC and proceed to dismiss the suit.
16. Now, question which arises for consideration is that on what basis and material Court would determine contemplation, if any, of urgent interim relief in the suit, as used in Section 12-A of the Act. As has been observed in the aforesaid judgments, contemplation, if any, of urgent interim relief can only be determined on the frame of the plaint and the relief sought. Whether such contemplation, if any, is of urgent interim relief is to be determined solely on the basis of pleadings and the relief sought by the plaintiff. If plaintiff succeeds in establishing that urgent interim relief is required to be passed, suit cannot be dismissed on the ground that he has not exhausted the remedy of pre-institution mediation, as provided in Section 12-A of the Act. While determining/adjudging prayer made for urgent interim relief, Commercial Court is required to examine the nature and subject matter ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 19 of the suit, the cause of action and the prayer for interim relief. Facts and circumstances of the case are required to be considered holistically .
from the standpoint of the plaintiff. After having examined pleadings as well as documents adduced on record, if Court is convinced that there is a prima facie case in favour of the plaintiffs and irreparable harm and injury would be caused in the event of non-grant of urgent interim relief, as prayed for, coupled with the fact that balance of convenience also lies in their favour, it can always proceed to entertain the suit and pass appropriate orders.
17. Though, Mr. Arjun Lall, learned counsel representing defendant No.2, while making this Court peruse the pleadings adduced on record, vehemently argued that though there is nothing suggestive of the fact that urgent interim relief is required, but even otherwise, pleadings, i.e. averments made in the plaint as well as application filed under Order 39 Rule 1 & 2 CPC, cannot be the sole factor to determine contemplation, if any, of urgent interim relief because some times party seeking such relief can camouflage by making such pleadings which either are incorrect or are made to bypass the statutory mandate of pre-institution mediation. He submitted that Hon'ble Apex Court in the judgments relied upon by him, has not only deprecated such practice, but has also cast duty upon the ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 20 Courts to check such camouflage and guise made by the plaintiffs to bypass the statutory mandate of pre-institution mediation.
.
18. Aforesaid submission/observation made by Mr. Arjun Lall, being totally in conformity with the observation made by Hon'ble Apex Court in Patil's case (supra), needs to be acknowledged and admittedly, duty has been cast upon the Courts to check such deception and falsity. At the cost of repetition, this Court may observe that bare reading of provision contained in Section 12-A(1) of the Act, clearly suggests that though onus is upon the plaintiff to prove contemplation, if any, of urgent interim relief for entitling him/her to file the civil suit under the Commercial Courts Act without availing alternate remedy of pre-institution mediation under Section 12-A of the Act, but at the same time, Commercial Courts also have a role, though limited. In case, it is only left to the plaintiffs to decide whether to resort to the procedure under Section 12-A of the Commercial Courts Act, it would amount to giving unfettered right, which is not justified, especially when pre-institution mediation under Section 12-A of the Commercial Courts Act, is mandatory, as has been held by Hon'ble Apex Court in Patil's case (supra). The word 'contemplate any urgent interim relief' used in Section 12-A of the Commercial Courts Act, with reference to suit, makes it mandatory for a Court to ascertain from the record contemplation, if any, of urgent interim relief, which means that it would ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 21 sift through plaint, documents and facts pressed into service by the plaintiffs to establish and indicate need of urgent interim relief. After .
having undertaken precise and limited exercise, as indicated hereinabove, Commercial Court would arrive at a conclusion that whether suit filed by the plaintiffs contemplates any urgent interim relief or not. If it is satisfied, it besides entertaining the suit can consider the prayer made by the plaintiffs for interim relief. Reliance in this regard is placed upon the judgment passed by Hon'ble Apex Court in Yamini Manohar v T.K.D. Keerthi, 2023 SCC OnLine SC 1382. Relevant paras of the judgment reads as under:
"8. The High Court of Delhi in "Chandra Kishore Chaurasia v. R.A. Perfumery Works Private Limited" observes:
"30. The contention that it would be necessary for the plaintiff to file an application seeking exemption from the provisions of Section 12A of the Commercial Courts Act, 2015, is unmerited. This Court cannot accept the said contention for several reasons.
31. First of all, there is no provision under Section 12A of the Commercial Courts Act, 2015 that requires the plaintiff to make any such application in a suit which involves urgent interim reliefs. As stated above, if the suit involves urgent interim relief, Section 12A of the Commercial Courts Act, 2015 is inapplicable and it is not necessary for the plaintiff to enter into a pre-institution mediation.
32. Second, a suit, which does not contemplate urgent interim relief, cannot be instituted without exhaustion of pre-institution mediation, as required under Section 12A(1) of the Commercial Courts Act, 2015. As noted above, the Supreme Court has held that the said provision is mandatory and it is compulsory for a plaintiff to exhaust the remedy of pre-institution mediation, in accordance with the rules before instituting a suit. The Court has no discretion to exempt a plaintiff from the applicability of Section 12A(1) of the Commercial Courts Act, 2015. It is not permissible for the court to pass an order contrary to law; therefore, an application seeking exemption from engaging in pre-institution mediation, in a suit that does not involve urgent interim reliefs, would not lie.::: Downloaded on - 03/04/2024 20:34:24 :::CIS 22
33. This Court also finds it difficult to accept that a commercial court is required to determine whether the urgent interim reliefs ought to have been claimed in a suit for determining whether the same is hit by the bar of Section 12A(1) of the Commercial Courts Act, 2015. The question whether a plaintiff desires any urgent relief is to be .
decided solely by the plaintiff while instituting a suit. The court may or may not accede to such a request for an urgent interim relief. But that it not relevant to determine whether the plaintiff was required to exhaust the remedy of pre-institution mediation. The question whether a suit involves any urgent interim relief is not contingent on whether the court accedes to the plaintiff's request for interim relief.
34. The use of the words "contemplate any urgent interim relief" as used in Section 12(1) of the Commercial Courts Act, 2015 are used to qualify the category of a suit. This is determined solely on the frame of the plaint and the relief sought. The plaintiff is the sole determinant of the pleadings in the suit and the relief sought.
35. This Court is of the view that the question whether a suit involves any urgent interim relief is to be determined solely on the basis of the pleadings and the relief(s) sought by the plaintiff. If a plaintiff seeks any urgent interim relief, the suit cannot be dismissed on the ground that the plaintiff has not exhausted the pre-institution remedy of mediation as contemplated under Section 12A(1) of the Commercial Courts Act, 2015.
9. We are of the opinion that when a plaint is filed under the CC Act, with a prayer for an urgent interim relief, the commercial court should examine the nature and the subject matter of the suit, the cause of action, and the prayer for interim relief. The prayer for urgent interim relief should not be a disguise or mask to wriggle out of and get over Section 12A of the CC Act. The facts and circumstances of the case have to be considered holistically from the standpoint of the plaintiff. Non-grant of interim relief at the ad-interim stage, when the plaint is taken up for registration/admission and examination, will not justify dismissal of the commercial suit under Order VII, Rule 11 of the Code; at times, interim relief is granted after issuance of notice. Nor can the suit be dismissed under Order VII, Rule 11 of the Code, because the interim relief, post the arguments, is denied on merits and on examination of the three principles, namely, (I) prima facie case, (ii) irreparable harm and injury, and (iii) balance of convenience. The fact that the court issued notice and/or granted interim stay may indicate that the court is inclined to entertain the plaint.
10. Having stated so, it is difficult to agree with the proposition that the plaintiff has the absolute choice and right to paralyze Section 12A of the CC Act by making a prayer for urgent interim relief. Camouflage and guise to bypass the statutory mandate of pre-litigation mediation should be checked when deception and falsity is apparent or established. The proposition that the commercial courts do have a role, albeit a limited one, should be accepted, otherwise it would be ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 23 up to the plaintiff alone to decide whether to resort to the procedure under Section 12A of the CC Act. An 'absolute and unfettered right' approach is not justified if the pre-institution mediation under Section 12A of the CC Act is mandatory, as held by this Court in Patil Automation Private Limited (supra). The words 'contemplate any .
urgent interim relief' in Section 12A(1) of the CC Act, with reference to the suit, should be read as conferring power on the court to be satisfied. They suggest that the suit must "contemplate", which means the plaint, documents and facts should show and indicate the need for an urgent interim relief.
This is the precise and limited exercise that the commercial courts will undertake, the contours of which have been explained in the earlier paragraph(s). This will be sufficient to keep in check and ensure that the legislative object/intent behind the enactment of section 12A of the CC Act is not defeated."
19. Reliance is also placed upon the judgment titled Proactive Ship Magament's case (supra), relevant paras of which reads as under:
"40. The plaintiff's argument that contemplation of urgent interim relief may revive post-institution of the suit or even at the stage of trial is without statutory basis. The words used in section 12-A makes it clear that the contemplation of urgency begins and ends at the point of institution, i.e. material point of time when the contemplation must fructify into a proved and pleaded case for urgent interim relief. Hence allowing the suit to remain in the records despite an absence of urgency on the contingency that urgency may arise at a later point of time is patently contrary to the mandate of section 12-A.
41. Moreover, the words "urgent interim relief" by its very definition means relief which the plaintiff seeks at the interlocutory/interim stage and one that cannot wait for a later adjudication on affidavits or at the time of trial. It hence stands to reason that the plaintiff would be under an obligation to explore mediation as an alternative dispute redressal mechanism before institution of a suit where the plaintiff does not need such urgent interim relief. Leave for dispensation of the mandate of section 12-A would hence be necessary where the plaintiff cannot afford - in terms of time - to exhaust the remedy of mediation and only thereafter institute the suit."
20. Now being guided by the observations and findings returned by the Hon'ble Apex Court in afore judgments with regard to determination of involvement of urgent interim relief, if any, in the suit filed under the Commercial Courts Act, this Court would make an ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 24 endeavour to find out that whether plaint as well as documents annexed therewith, filed by the petitioners, indicate need for urgent .
interim relief, as a result thereof, suit filed by the petitioners, is maintainable without their having exhausted remedy of pre-institution mediation.
21. Having carefully gone through the pleadings as well as documents placed on record along with the plaint, this Court is not persuaded to agree with Mr. Arjun Lall, learned counsel representing defendant No.2, that there was no requirement for grant of urgent interim relief and as a result thereof, suit having been filed by the plaintiffs is not maintainable and deserves to by rejected by this Court in terms of the provisions contained under Order 7 Rule 11(d) of the CPC.
22. Bare perusal of the pleadings clearly reveals that plaintiff No.1, is a reputed international company dealing with the drugs and petitioner No.2, is one of the leading pharmaceutical company having its headquarter in Ingelheim, Germany. It is also averred in the plaint that afore company operates globally with over 175 affiliates and a total of more than 51,000 employees. Though plaintiff No.1 has claimed to be owner of plethora of patents worldwide including Indian Patent No.268846, but documents placed on record clearly reveals that it was granted subject patent, i.e. 846, on September 18, 2015, under ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 25 Section 43 of the Patents Act, 1970 under IN'846 for pharmaceutical product entitled "GLUCOPYRANOSYL SUBSTITUTED BENZENOL .
DERIVATIVES, DRUGS CONTAINING SAID COMPOUNDS, THE USE THEREOF AND METHOD FOR THE PRODUCTION THEREOF". The subject patent as detailed hereinabove, is registered in the name of plaintiff No.1 and is currently valid and subsisting, as a result of which, by virtue of Section 48 of the Patent Act, plaintiff No.1, has the exclusive right to prevent third parties, who do not have its consent for the act of making, using, offering for sale, selling and importing for those purposes any product whatsoever is covered by the subject patent in India. It has been averred in the plaint that medicinal product, "Empagliflozin Tablet" and Empagliflozin + Metformin Hydrochloride Tablets" covered by the subject patent was introduced and launched in the Indian market under the brand name "Jardiance/Jardiance Duo" in the year 2015. The plaintiffs have an active presence in India since then.
23. Vide suit at hand, plaintiffs have sought to enforce its subject patent and restrain the defendants from making, using, offering for sale, selling, importing and/or exporting Empagliflozin API, the medicinal product "Empagliflozin Tablet" and/or "Empagliflozin + Metformin Hydrochloride Tablets" covered by the subject patent. It has been categorically averred in the suit that in view of the immense ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 26 commercial success of the product and in order to gain undue advantage from the launch of infringing product in the Indian market, .
two entities by their names MSN Laboratories Private Limited and Dr. Reddy's Laboratories Limited have filed common revocation petition before the Hon'ble High Court of Delhi, which is pending adjudication.
24. It is averred in the plaint that pursuant to grant of patent for a term of 20 years from the date of filing of the international patent application under Patent Cooperation Treaty, Plaintiffs are vested with exclusive right to prevent third parties, who do not have their consent from the act of making, using, offering for sale, selling and importing product in India. It has been specifically averred that defendants product is a generic version of "Empagliflozin Tablet" being manufactured by defendant No.1 and marketed by defendant No.2 fall within the scope of claim -6 of subject patent of IN-846 and accordingly infringes it. If it is so, plaintiffs are will within right to file the suit, as detailed hereinabove. To prove infringement of the patent, plaintiffs have placed on record carton/strip pack of the infringing product, which acknowledges the fact that infringing product "Empagliflozin Tablet" is being manufactured by defendant No.1 and marketed and sold by defendant No.2. Apart from above, technical affidavit deposed by one Dipl.-Chem. Dietmar Krause, is also annexed with the plaint.
::: Downloaded on - 03/04/2024 20:34:24 :::CIS 2725. Plaintiffs being vigilant in protecting their rights in medicine product "Empagliflozin Tablet" and "Empagliflozin + Metformin .
Hydrochloride Tablets", have initiated proceedings against the defendants and various others before this Court, detail whereof has been given in the plaint. Plaintiffs have categorically stated that in view of the subsisting patent rights to plaintiff No.1, acts of defendants from manufacturing, using, offering for sale, selling, importing or exporting the infringing product, are purely driven by its' malafide intention to trade upon and derive unjust enrichment and gains at the cost of plaintiff No.1's invention, which was the result of years of research and development.
26. By furnishing details with regard to manufacturing of the infringing product being done by the defendants, plaintiffs have tried to establish prima facie case in their favour. It has been further averred in the plaint that irreparable harm and injury would be caused on account of infringement of product by the defendants, who do not have any authority to use the patent granted to plaintiff No.1. It has been averred that manufacturing of the product covered by subject patent by the defendants, will not only be in violation of plaintiff No.1's exclusive right under Section 48 of the Patent Act, 1970, but will also cause irreparable injury to the plaintiffs. Most importantly, as have been categorically stated in Para-43 of the plaint that irreparable injury will be caused to ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 28 the plaintiffs in case order of interim injunction, as prayed for, is not passed in favour of the plaintiffs, which cannot be compensated in .
monetary terms. Plaintiffs have averred that defendants' act of infringing the plaintiff No.1's subject patent will cause them substantial financial loss and the balance of convenience also lies in their favour.
No doubt, in Para-47 of the plaint, it has been averred that cause of action first arose in favour of the plaintiffs on September 18, 2015, on which date, subject patent was granted to it by the controller of the patent, but in same para, it has been further stated that cause of action arises with every act of launching, manufacturing, marketing, using, importing, offering for sale, selling, importing and/or exporting of the infringing product. It has been further averred in this Para that cause of action continues to subsist until defendants are not restrained from launching, manufacturing marketing, using, importing, offering for sale, selling, importing and/or exporting the said product by the order of this Court.
27. In Para-39 of the plaint, it has been categorically averred on behalf of the plaintiffs that there is an urgent need to restrain the defendants from infringing the patent rights of plaintiff No.1 under Patent No.268846 by making, using, offering for sale, selling, importing and/or exporting the said product covered by the subject patent.
::: Downloaded on - 03/04/2024 20:34:24 :::CIS 2928. Having perused the plaint in its entirety as well as averments made in the application filed separately for urgent interim .
relief, this Court is not persuaded to agree with Mr. Arjun Lall, that no sufficient pleadings are on record to enable this Court to arrive at a conclusion that suit filed by the plaintiffs contemplates urgent interim relief. Similarly, submission of Mr. Arjun Lall that there are no specific pleadings with regard to requirement of urgent interim relief, rather by making clever pleadings, attempt has been made by the plaintiffs to bypass the statutory mandate of pre-institution mediation, deserves rejection.
29. Urgency, in any, of the specified translations enumerated in Section 2(c) of the Act, which defines 'commercial dispute', would vary from case to case and certainly there can be no straight jacket formula and each case is required to be decided on its own facts.
30. There must be plenty-of pleadings to support the case of urgent interim relief and Court at the time of presentation of the plaint, is required to satisfy itself that averments made therein, justify the case for urgent interim relief and for dispensation with the requirement of Section 12-A of the Act. Since, at the time of admission of plaint, defendant is not represented, duty cast upon the Court, pursuant to the aforesaid provision, is high because it besides hearing submissions made on behalf of the learned counsel representing the plaintiffs with ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 30 regard to involvement of urgent interim relief in the case, is also under obligation to sift the material placed on record itself to ascertain .
contemplation, if any, of interim relief because such exercise, if any, undertaken by the Court would not only decide the question of grant of urgent interim relief, but that would also answer the maintainability of suit filed without there being exhausting the remedy of pre-institution mediation, as provided in Section 12-A of the Act.
31. Reliance in this regard is placed upon the judgment passed by High Court of Calcutta in Indian Explosives Pvt. Ltd. v.
Ideal Detonators Pvt. Ltd. And others, 2023 SCC OnLine Cal 1944, relevant paras reads as under:
"9. Section 9 of the Civil Procedure Code, 1908 gives the Courts an inherent right to try all suits of a civil nature subject to jurisdiction with the exception of suits which are expressly or impliedly barred. The Act had been introduced for speedy disposal of high value commercial disputes. By introducing section 12A of the Act, the Act has carved out two different categories of suits i.e. where no urgent relief is contemplated and those where urgent relief is contemplated.
10. Mediation is now perceived as a new mechanism of access to justice and a potent alternate dispute resolution device in the justice delivery system. This is the clear legislative intent of the Act. However, an exception is to be found in section 12 A of the Act where a class of suits i.e. suits which contemplate urgent interim reliefs have been exempted from the requirement of mediation. The section quite obviously saves immediate access to justice as contemplated ordinarily through Courts in cases of urgent interim reliefs.
11. There may be urgency in any of the specified transactions enumerated in section 2(c) of the Act which defines "commercial dispute". Urgency would vary from case to case. There can be no strait jacket formulae in such cases. Each case must be decided on its own facts. There must be pleadings to support the case of urgent interim reliefs. The Court at the time of presentation of the plaint has to be satisfied that there are averments which justify a case for urgent interim reliefs and for dispensation with the requirement of section 12A of the Act in the overall facts and circumstances. Ordinarily, at the stage of admission of the plaint, the defendant is not represented. However, a defendant has a right to question whether dispensation has been appropriately granted or not. This exercise may ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 31 require the Court to re-examine the grant of dispensation. The entire exercise of seeking dispensation under section 12A of the Act must be subject to judicial scrutiny."
32. Reliance is also placed upon the judgment passed by .
Hon'ble High Court of Calcutta in Proactive Ship Management Pvt.
Ltd.'s case (supra) "16. The Court receiving the plaint and considering grant of leave for dispensation of the requirement under section 12-A of the Commercial Courts Act is also clothed with the power to decide whether the suit contemplates urgent interim relief at the point of institution. In other words, the contemplation under section 12-A is not the sole domain of the plaintiff but a multi-decision domain where the Court also plays its part in deciding whether the suit contemplates urgent interim relief and (consequent to such decision) whether the plaintiff should be granted leave to institute the suit without exhausting the pre-institution mediation option : Yamini Manohar v. T.K.D. Keerthi; Special Leave Petition (Civil) 32275/2023.
17. The onus shifts to the defendant subsequently to establish that the suit did not contemplate urgent interim relief at the time of institution. The Court will then examine the case brought by the defendant in considering whether the dispensation of the mandate under section 12-A was wrongly granted.
18. It is also relevant to state that grant or refusal of relief is not relevant for deciding the issue of urgency. The Court's finding on urgency is however of paramount importance. This is precisely where the second order dated 19.10.2023 comes to the fore."
33. In the case at hand, this Court finds from the pleadings as well as documents adduced on record by the plaintiffs that suit filed by them contemplates urgent interim relief and as such, rightly came to be granted by this Court vide order dated 07.12.2022, while considering the prayer made in OMP No.874 of 2022, having been filed by the plaintiffs.
33. Interestingly, perusal of the written statement filed by the defendants clearly suggest that they themselves have admitted factum with regard to infringement and while offering to withdraw their product, ::: Downloaded on - 03/04/2024 20:34:24 :::CIS 32 have tendered unconditional apology, meaning thereby that till the filing of the suit, they had been indulging in the infringement of the patent .
granted in favour of the plaintiffs, if it is so, it does not lie on the mouth of defendants that cause of action, if any, had accrued in favour of the petitioners on 18th September, 2015 and not thereafter. Since, defendants themselves have admitted infringement of the patent in the written statement and have offered to rectify their mistake, plaintiffs cannot be said to have committed any illegality by filing the suit straightaway in the competent court of law without exhausting the remedy of pre-institution mediation, as provided under Section 12-A of the Act.
34. Consequently, in view of the detailed discussion made hereinabove, this Court finds no force in the objection raised by the defendants qua maintainability of the suit and as such, the same is dismissed and it is held that suit is maintainable.
Now list this matter for further proceedings on 08.05.2024.
(Sandeep Sharma) Judge 1st April, 2024 (reena) ::: Downloaded on - 03/04/2024 20:34:24 :::CIS