A) ABSTRACT / HEADNOTE

The decision in S. D. Containers Indore v. M/s Mold Tek Packaging Ltd. addresses the nuanced jurisdictional conflict arising at the intersection of the Design Act, 2000 and the Commercial Courts Act, 2015. The Supreme Court was called upon to clarify the legal mechanism governing the transfer of suits involving design infringement where the defendant raises a plea for cancellation of a registered design under Section 19 of the Design Act, 2000. The core controversy emerged from the improper reliance placed by the High Court on Godrej Sara Lee Ltd. v. Reckitt Benckiser Australia Pty. Ltd., leading to an erroneous conclusion that only the Controller of Designs possessed exclusive jurisdiction over cancellation proceedings.

The Court undertook a meticulous statutory interpretation of Sections 19 and 22 of the Design Act, 2000, delineating the two independent remedies available for cancellation of registered designs. It reaffirmed that while Section 19 empowers any interested person to seek cancellation before the Controller, Section 22(4) mandates the transfer of an infringement suit to the High Court when revocation is pleaded as a defence. The judgment further clarified that the transfer is automatic and ministerial in nature once such defence is raised.

The ruling decisively resolves the confusion concerning the appropriate High Court to which such suits must be transferred, holding that jurisdiction vests in the High Court within whose territorial limits the cause of action arises. By setting aside the High Court’s order and remitting the matter to the Madhya Pradesh High Court, Indore Bench, the Supreme Court reinforced jurisdictional discipline and procedural clarity in intellectual property litigation.

Keywords:
Design Act, 2000; Commercial Courts Act, 2015; Jurisdiction; Cancellation of Design; Section 22(4)

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The judgment arose in the backdrop of persistent judicial ambiguity regarding jurisdictional competence in design infringement litigation, particularly after the enactment of the Commercial Courts Act, 2015. The dispute originated from a suit for declaration and permanent injunction concerning infringement of registered container and lid designs. The plaintiff invoked statutory protection under the Design Act, 2000, asserting exclusivity over registered industrial designs.

The defendant, in response, not only contested infringement but actively challenged the validity of the registered designs by invoking Section 4(a), asserting absence of novelty and originality. This defensive strategy triggered the statutory mechanism under Section 22(4), mandating transfer of the suit upon the raising of cancellation grounds.

However, procedural confusion ensued when the Commercial Court transferred the suit to the Calcutta High Court, despite the cause of action having arisen entirely within Indore. The Madhya Pradesh High Court compounded the error by relying upon Godrej Sara Lee Ltd., misapplying its ratio to a fact situation involving a civil suit rather than a controller-initiated cancellation proceeding.

The Supreme Court’s intervention was thus necessitated to clarify the interplay between the Design Act, 2000 and the Commercial Courts Act, 2015, particularly in jurisdictions lacking ordinary original civil jurisdiction. The ruling undertakes a purposive construction of the statutes, ensuring that procedural routes do not frustrate substantive rights of parties in intellectual property disputes.

D) FACTS OF THE CASE

The plaintiff, M/s Mold Tek Packaging Ltd., instituted a commercial suit at Indore seeking a declaration and permanent injunction restraining S. D. Containers Indore from copying or using its registered designs relating to containers and lids bearing Design Application Nos. 299039 and 299041. The registrations were asserted to be valid, subsisting, and exclusive under the Design Act, 2000.

Upon service of summons, the defendant filed a written statement coupled with a counterclaim, alleging that the impugned designs lacked novelty and originality and were therefore non-registrable under Section 4(a). The defendant simultaneously filed an application under Section 22(4) read with Section 19(2) seeking transfer of the suit to the High Court.

The Commercial Court allowed the application but erroneously ordered transfer to the Calcutta High Court. Aggrieved, the plaintiff challenged this order before the Madhya Pradesh High Court. The High Court, relying upon Godrej Sara Lee Ltd., held that cancellation proceedings lie exclusively before the Controller of Designs and that the Commercial Court retained jurisdiction.

This led to the present appeal before the Supreme Court, questioning both the interpretation of statutory provisions and the territorial jurisdiction of the High Court to which the suit was transferred. The factual matrix thus squarely presented a legal question of jurisdiction rather than merits of design validity.

E) LEGAL ISSUES RAISED

i. Whether a civil suit involving design infringement must be transferred to the High Court upon a plea of cancellation under Section 19 being raised as a defence under Section 22(3)?
ii. Whether the Commercial Courts Act, 2015 overrides the mandatory transfer mechanism under Section 22(4) of the Design Act, 2000?
iii. Which High Court possesses territorial jurisdiction to adjudicate a transferred suit under Section 22(4)?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the appellant submitted that once a plea for cancellation of registration is raised, Section 22(4) operates automatically and mandates transfer of the suit to the High Court. It was argued that the Commercial Court has no discretion to examine merits of cancellation.

Reliance was placed upon Standard Glass Beads Factory v. Shri Dhar to contend that the expression “shall be transferred” leaves no residual jurisdiction with the trial court. It was further argued that appellate jurisdiction under Section 19(2) is distinct from original jurisdiction exercised under Section 22(4).

The appellant contended that the High Court misapplied Godrej Sara Lee Ltd., which arose from cancellation proceedings before the Controller and not from an infringement suit. The Commercial Courts Act, 2015 was argued not to dilute statutory mandates under the Design Act.

G) RESPONDENT’S ARGUMENTS

The counsels for the respondent submitted that cancellation proceedings are exclusively vested with the Controller of Designs under Section 19. It was argued that permitting High Courts to entertain such pleas would create parallel jurisdictions.

Reliance was placed upon Godrej Sara Lee Ltd. and Whirlpool of India v. Videocon Industries Ltd. to assert that remedies under Sections 19 and 22 are distinct and independent. The respondent argued that the Commercial Court was competent to adjudicate the suit and that the High Court correctly exercised supervisory jurisdiction.

H) JUDGEMENT

The Supreme Court categorically held that Sections 19 and 22 of the Design Act, 2000 provide two independent statutory routes for cancellation of design registration. The Court clarified that while Section 19 operates independently before the Controller, Section 22(4) is triggered only when cancellation is pleaded as a defence in an infringement suit.

The Court rejected the High Court’s reliance on Godrej Sara Lee Ltd., holding that it dealt with appellate jurisdiction from the Controller’s order and not with a transferred civil suit. The Court emphasized that once a cancellation defence is raised, transfer becomes ministerial and non-discretionary.

On jurisdiction, the Court held that the High Court within whose territorial limits the cause of action arises alone possesses jurisdiction. Since no part of the cause of action arose in Kolkata, transfer to the Calcutta High Court was declared illegal. The matter was remitted to the Madhya Pradesh High Court, Indore Bench for adjudication in accordance with law.

a) RATIO DECIDENDI

The ratio rests upon the statutory interpretation that Section 22(4) mandates automatic transfer of a suit to the High Court when revocation grounds under Section 19 are raised as a defence. The Commercial Courts Act does not override this mandate in absence of inconsistency. Jurisdiction lies only with the High Court where cause of action arises.

b) OBITER DICTA

The Court observed that conflating appellate jurisdiction with original jurisdiction leads to procedural chaos. It cautioned against mechanical reliance on precedents without contextual application. These observations reinforce judicial discipline in statutory interpretation.

c) GUIDELINES

i. Trial courts must transfer suits immediately upon cancellation defence being raised.
ii. Merits of cancellation cannot be examined by Commercial Courts.
iii. Transfer must be to the jurisdictional High Court only.
iv. Commercial Courts Act does not dilute Design Act mandates.

I) CONCLUSION & COMMENTS

The judgment decisively resolves long-standing jurisdictional confusion in design litigation. It strengthens procedural certainty and prevents forum shopping. The ruling reinforces statutory supremacy and aligns intellectual property adjudication with legislative intent. The decision will significantly streamline future design infringement litigation across India.

J) REFERENCES

a) Important Cases Referred

i. Godrej Sara Lee Ltd. v. Reckitt Benckiser Australia Pty. Ltd., (2010) 2 SCC 535
ii. Standard Glass Beads Factory v. Shri Dhar, AIR 1961 All 101
iii. Whirlpool of India v. Videocon Industries Ltd., 2014 SCC OnLine Bom 565

b) Important Statutes Referred

i. Design Act, 2000
ii. Commercial Courts Act, 2015