Delhi High Court - Orders
M/S Veerji Restaurant Private Limited vs Mohini Chaddha Trading As Veerj Ji Malai ... on 24 November, 2025
Author: Manmeet Pritam Singh Arora
Bench: Manmeet Pritam Singh Arora
$~23
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(COMM) 457/2024 & CCP(O) 62/2025 CRL.M.A. 38727/2024
I.A. 49053/2024 I.A. 9987/2025 I.A. 10911/2025 I.A. 19308/2025
I.A. 19962/2025
M/S VEERJI RESTAURANT PRIVATE LIMITED .....Plaintiff
Through: Mr. Nihit Nagpal and Mr. Vaibhav
Mehra, Mr. Tarun Tripathi, Mrs.
Bindra Rana, Advocates
versus
MOHINI CHADDHA TRADING AS VEERJ JI MALAI CHAAP
WALE & ORS. .....Defendants
Through: Mr. Rishub Kapoor, Advocate for D-2
with D-2 in person
Mr. Pawandeep Singh, Adv. for D-3
and D-4 along with Defendants in
person
CORAM:
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
ORDER
% 24.11.2025 I.A. 9987/2025(application under Order XXXIX Rule 2A CPC)
1. This is an application under Order XXXIX Rule 2A of the Code of Civil Procedure, 1908 ['CPC'], filed by the Plaintiff for contempt of order dated 28.05.2024 by defendant no. 2.
2. Learned counsel for the non-applicant/defendant no. 2 states that violations pointed out in the application have been rectified and prays that the application be disposed of taking on record the aforesaid compliance.
CS(COMM) 457/2024 Page 1 of 11This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56
3. Learned counsel for the plaintiff states that plaintiff has no objection if the application is disposed of in terms of undertaking of defendant no. 2 recorded vide order dated 12.08.2025.
4. In view of the aforesaid submissions of plaintiff and defendant no. 2, the application is disposed of and is directed that defendant no. 2 will remain bound by its statement recorded on 12.08.2025.
5. The registry is directed to not list this application any further. I.A. 19308/2025(seeking extension of time in complying with the order dated 26.05.2025)
6. This is an application under Section 151 of CPC filed by the plaintiff seeking extension of time in complying with the order dated 26.05.2025.
7. Learned counsel for the plaintiff and defendant no. 2 states that this application has become infructuous as plaintiff has already complied with the order dated 26.05.2025.
8. The application is accordingly disposed of.
CCP(O) 62/2025(application under Section 2(A) of the Contempt of Courts Act, 1971 read with Order XXXIX Rule 2A CPC)
9. This is a contempt petition filed under Section 2(A) read with Sections 10, 11 and 12 of the Contempt of Courts Act, 1971 read with Order XXXIX Rule 2A read with section 151 CPC filed by defendant no. 2 alleging that plaintiff has failed to comply with the order dated 26.05.2025.
10. Learned counsel for defendant no. 2 states that plaintiff has subsequently complied with the order and accordingly he is not pressing this petition any further.
11. The petition is accordingly disposed of.
I.A. 10911/2025(seeking leave to bring on record additional documents) CS(COMM) 457/2024 Page 2 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56
12. This is an application under Order XI Rule 1 (C) of the CPC (as amended by the commercial courts Act, 2015) read with section 151 CPC, filed by the plaintiff seeking leave to file additional documents filed vide e- diary no. 2968958/2025.
13. Learned counsel for the plaintiff states that these are the documents pertaining to defendant no. 2's spouse in respect of another outlet opened during the pendency of these proceedings and may have a bearing on the inter-se claims between the plaintiff and defendant no. 2.
14. Issue notice.
15. Learned counsel for defendant no. 2 accepts notice.
16. Learned counsel for the non-applicant/defendant no. 2 states that documents may be taken on record without prejudice to its submission with respect to lack of relevance and admissibility and the defendant no. 2 as well may be granted an opportunity to file rebuttal documents within two (2) weeks.
17. In view of the aforesaid submissions of the parties, the application is allowed.
18. Documents are taken on record, without prejudice to the rights and contentions of the defendant no. 2 and its objection of relevance and admissibility are kept open.
19. The defendant no. 2 is directed to file an affidavit of admission/denial of documents within two (2) weeks.
20. The defendant no. 2 is at liberty to file rebuttal documents within two (2) weeks, failing which the liberty granted shall stands exhausted.
21. With the aforesaid directions, application stands disposed of.
CS(COMM) 457/2024 Page 3 of 11This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 I.A. 19962/2025(application to set aside order dated 23.10.2024)
22. This is an application under Order IX Rule 7 CPC filed by the defendant nos. 3 and 4 praying that the order dated 23.10.2024 by which the applicants i.e., defendant nos. 3 and 4 were ordered to be proceed ex-parte, be set aside.
23. Mr. Pawandeep Singh, learned counsel appearing on behalf of applicant states that initially the applicants/defendants had engaged another counsel, however since she was on the family way, she did not represent the parties in the matter and remained absent from various hearings; and it was in these circumstances that defendant nos. 3 and 4 were proceeded ex-parte.
24. He states that the said order may be set aside and defendant nos. 3 and 4 may be permitted to be represented in this matter.
25. Learned counsel for the non-applicant/plaintiff states that he has filed a detailed reply which shows that as per record, defendant no. 3 was served on 17.08.2024 and defendant no. 4 was served with summons on 25.07.2024.
26. He states that despite due service of summons, the said defendant nos. 3 and 4 have failed to file their written statement within the statutory period of limitation or defend these proceedings diligently.
27. He states that in these circumstances not only the said defendant nos. 3 and 4 have forfeited their right to file their written statement by operation of law but the Court rightly proceeded ex-parte against them.
28. This Court has considered the submissions of the parties.
29. To the extent that defendant no. 3 was served on 17.08.2024 and defendant no. 4 was served on 25.07.2024, there is no dispute and in view CS(COMM) 457/2024 Page 4 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 thereof by operation of law, the right of defendant nos. 3 and 4 to file their written statement stands forfeited after passage of 120 days.
30. However, in view of the fact that defendant nos. 3 and 4 are now seeking to be represented in the matter, the defendants are permitted to join the proceedings w.e.f. today and the order dated 23.10.2024 proceeding ex- parte against them to that extent is recalled.
31. With the aforesaid directions, the application stands disposed of. I.A. 49053/2024 (Under Order XXXIX Rule 4 CPC)
32. This is an application under Order XXXIX Rule 4 CPC filed by the defendant no. 2 seeking vacation of the interim order dated 28.05.2024.
33. Learned counsel of the applicant/defendant no. 2 states that the interim order dated 28.05.2024 was passed against defendant no. 2 due to incorrect facts pleaded in the plaint. He states that the relevant paragraphs of the plaint vis-à-vis defendant no. 2 are paragraph nos. '28' to '33'.
34. He states that the plaint incorrectly records that there was an oral franchise agreement between the parties and that the alleged oral agreement stood terminated leading to filing of the present suit. He states on the contrary; it is a matter of record that there was a written franchise agreement dated 05.07.2022 and 07.07.2022 between the parties.
35. He states that the said franchise agreement was never terminated and the alleged legal notice dated 06.04.2024 was never served on the defendant no. 2 which in fact has been admitted by the plaintiff in its reply to an interim application.
36. He states that since there was a valid and subsisting agreement between plaintiff and defendant no. 2 i.e., 07.07.2022 permitting the use of the trademark by the defendant no. 2, the present suit was not maintainable CS(COMM) 457/2024 Page 5 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 in view of Section 30(3) of the Trademarks Act, 1999.
37. He states that due to the passing of the injunction order dated 28.05.2024, the defendant no. 2 suffered losses as business was impacted. The online listings on the e-platforms were taken down without any just reason due to the illegal actions of the plaintiff. The restaurant at the location which is subject matter of the agreement dated 07.07.2022 was closed down. He states that defendant no. 2 had paid franchise fees of Rs. 5.90 lakhs and was entitled to uninterruptedly operate the outlet for a minimum period of five years, however due to the injunction the operations were disrupted prematurely. He states that defendant no. 2 has also paid Rs. 2.54 lakhs approximately towards royalty and the plaint wrongly alleges non-payment of royalty.
38. He states that in fact, defendant no. 2 was further misled by plaintiff into entering into a fresh franchise agreement dated 13.07.2024 for a second location through his spouse and the said agreement also now stands abandoned between the parties due to these disputes and the defendant no. 2 and his spouse suffered losses for the second location as well. He states that when the agreement dated 13.07.2024 was executed, defendant no. 2 was not aware about the injunction order dated 28.05.2024.
39. He states that the injunction order dated 28.05.2024 was not served on the defendant no. 2 prior to 13.07.2024 and was served sometime in last week of July 2024 as recorded in the order dated 18.10.2024 in these proceedings.
40. He states that defendant no. 2 and his spouse have suffered losses to the tune of Rs. 52 lakhs approximately due to the misconceived filing of the present suit against defendant no. 2 and the premature closure of the outlets.
CS(COMM) 457/2024 Page 6 of 11This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56
41. In reply, learned counsel for the plaintiff fairly concedes that averments made at paragraph '28' to '33' of the plaint vis-à-vis defendant no. 2 are inaccurate.
42. He states that indeed, there was a written franchise agreement dated 05.07.2022 and 07.07.2022 between the parties; however, the same was not disclosed in the plaint. He also does not dispute that the notice dated 06.04.2024 was not served on defendant no. 2.
43. He states, however, the averment in the plaint states that no royalty was paid by defendant no. 2 after the execution of the franchise agreement dated 07.07.2022 is correct and the plaintiff is entitled to recover royalty from the defendant no. 2 for the restaurant operated by him at the location covered by the franchise agreement dated 07.07.2022 until its closure in 2024. He states that plaintiff is entitled to royalty at 3% of the sales. He states that defendant no. 2 failed to provide the sales figures and no royalty was paid at all.
44. He states that due to the non-payment of the royalty, the plaintiff is entitled to terminate the franchise agreement dated 07.07.2022.
45. He states that defendant no. 2 has relied upon the payments made for purchase of material to allege payments towards royalty which is disputed by the plaintiff.
46. He states that similarly, plaintiff is entitled to recover royalty for the period, the second outlet was operated by the defendant no. 2's spouse at the distinct location.
47. He states that the plaintiff disputes the contentions of the defendant no. 2 vis-à-vis the circumstances in which the agreement dated 13.07.2024 was executed and his stand vis-à-vis the said agreement will be placed CS(COMM) 457/2024 Page 7 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 before the arbitral tribunal.
48. He states that the disputes between the parties requires reconciliation of accounts and even though parties attempted mediation, it has failed.
49. He states that it would be in the interest of plaintiff, defendant no. 2 and his spouse, if they are referred to arbitration in terms of clause 30.2 of the franchise agreement dated 07.07.2022 and clause 30.2 of the franchise agreement dated 13.07.2024, respectively. He states that a common arbitral tribunal can be constituted and the parties can be referred to a single arbitrator.
50. He states that it is the plaintiff's estimate that an amount of approximately Rs. 25 lakhs are due and recoverable towards royalty from the defendant no. 2 and his spouse for the period of operation of the two outlets.
51. He states that the amount of Rs. 5 lakhs deposited in the Court in pursuance to the order dated 26.05.2025 may be kept pending with the registry to await the final outcome of the arbitration between the parties.
52. In response, learned counsel for defendant no. 2 states that he has taken instructions from defendant no. 2 as well as his spouse and they as well are ready to refer the disputes arising between the parties from the franchise agreement dated 05.07.2022, 07.07.2022 and 13.07.2024 to arbitration.
53. He states that however, the arbitration clause(s) as stipulated in the franchise agreement dated 05.07.2022, 07.07.2022 and 13.07.2024 are restrictive and it would hamper defendant no. 2 and his spouse from raising their entire claim. In addition, he states that the fees and costs of arbitration may be capped as the defendant no. 2 is a salaried person and cannot sustain CS(COMM) 457/2024 Page 8 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 high costs and defendant no. 2 and his spouse be given liberty to pay the fees and costs in four tranches.
54. Mr. Nagpal learned counsel for the plaintiff states that he has no objection to the counter claims of defendant no. 2 and his spouse being referred to arbitration and plaintiff waives the restrictive nature of the arbitration clause in the franchise agreement dated 05.07.2022, 07.07.2022 and 13.07.2024.
Reference to arbitration
55. In the considered opinion of this Court in view of the joint consent of the parties for seeking reference to arbitration, this Court in exercise of its power under Section 89(1) of the CPC hereby refers parties to arbitration for all their disputes arising out of franchise agreement dated 05.07.2022, 07.07.2022 and 13.07.2024 to a tribunal presided by a sole arbitrator Mr. Abhimanyu Mahajan, Advocate [Enrl. No. - D/598-R/1998, Mobile No. 9811103447, e-mail ID: - [email protected]]. The parties will be entitled to raise all their claims and counter claims before the sole arbitrator without in any manner being restricted by the terms of the arbitration clause contained in the franchise agreements dated 05.07.2022, 07.07.2022 and 13.07.2024. The restriction of reference of claims in the arbitration clause hereby stands superseded with the consent of the parties and plaintiff's express waiver is recorded hereby.
56. Keeping in view that the combined value of the disputes between the parties is estimated at Rs. 75 lakhs, the fees of the Arbitrator is capped at Rs. 2 lakhs to be borne equally between the parties. One lakh by the plaintiff and one lakh jointly by defendant no. 2 and his spouse. The fee will be paid by the parties in four tranches.
CS(COMM) 457/2024 Page 9 of 11This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56
57. The amount of Rs. 5 lakhs deposited by the plaintiff with the registry of this Court shall remain deposited and will abide by any interim directions issued by the sole arbitrator and/or the final award.
58. Defendant no. 2 is directed to ensure that the consent of the spouse for reference of disputes under franchise agreement dated 13.07.2024 to arbitration is filed before this Court within one (1) week by way of an affidavit along with Vakalatnama. For this limited purpose, list the matter on 05.12.2025.
59. Parties will appear before the Arbitrator on 19.12.2025 at 02:30 PM for preliminary hearing.
The vacation of injunction order dated 28.05.2024
60. In view of the aforesaid submissions and admitted facts, this Court is of the opinion that the order dated 28.05.2024 passed against defendant no. 2 was not justified. The plaintiff has admitted that the notice dated 06.04.2024 was not served on the defendant no. 2. The averments made at paragraph '28' to '33' of the plaint were inaccurate and in the absence of any termination of the franchise agreement dated 05.07.2022 and 07.07.2022, the plaintiff could not have maintained this suit in view of Section 30(3) of the Trademarks Act, 1999. The plaintiff cannot shrug off its responsibility by alleging clerical error; the averments in the plaint cannot be explained away as inadvertent errors.
61. In view of these facts, it is apparent that the Court was misled into passing the ad-interim ex-parte injunction order dated 28.05.2024. Though the defendant no. 2 has already closed down the location at which the restaurant was running as on date and therefore the injunction as on date does not affect defendant no. 2, however, since the injunction order dated CS(COMM) 457/2024 Page 10 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56 28.05.2024 led to an abrupt closure of the outlet and disruption of services, there is prima facie merit in the submission of the defendant no. 2 that it suffered losses. This Court thus returns a finding that the injunction order dated 28.05.2024 qua defendant no.2 was obtained by the plaintiff by presenting inaccurate facts vis-à-vis termination of the franchise agreement. The application I.A. 49053/2024 is disposed of with the aforesaid finding. CS(COMM) 457/2024
62. The suit vis-à-vis defendant no. 2 stands disposed of as disputes between the parties stand referred to arbitration.
63. Learned counsel for defendant nos. 3 and 4 will revert with instructions if the suit can be disposed of qua them vis-à-vis the relief of permanent injunction.
64. For this limited purpose, list the matter on 05.12.2025.
65. The digitally signed copy of this order, duly uploaded on the official website of the Delhi High Court, www.delhihighcourt.nic.in, shall be treated as a certified copy of the order for the purpose of ensuring compliance. No physical copy of order shall be insisted by any authority/entity or litigant.
MANMEET PRITAM SINGH ARORA, J NOVEMBER 24, 2025/mt/rhc CS(COMM) 457/2024 Page 11 of 11 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/12/2025 at 20:48:56