1. Trademark infringement suit — Ex parte money decree — Appeal filed — High Court granted unconditional stay of execution — Challenge to stay order. (Para 2 , 7 , 14 , 15 , 17 , 18 )
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2025 Supreme(SC) 1774
SUPREME COURT OF INDIA
J.B. PARDIWALA, K.V. VISWANATHAN, JJ.
Lifestyle Equities C.V. and Another – Appellants
Versus
Amazon Technologies Inc. – Respondent
Petition for Special Leave to Appeal (C) No. 19767 of 2025
Decided On : 07-10-2025
Advocates appeared:
For Petitioner(s):Mr. Mukul Rohatgi, Sr. Adv. Mr. Gaurav Pachnanda, Sr.Adv. Mr. Sidhant Goel, Adv. Mr. Mohit Goel, Adv. Ms. Garima Bajaj, AOR Mr. Dipankar Mishra, Adv. Ms. Karmanya Dev Sharma, Adv. Mr. Udbhav Gady, Adv. For Respondent(s): Mr. Saikrishna Rajagopal, Adv. Mr. Sidharth Chopra, Adv. Ms. Sneha Jain, Adv. Mr. Devvrat Joshi, Adv. Mr. Angad Makkar, Adv. Ms. Swikriti Singhania, AOR
For Petitioner(s):Mr. Mukul Rohatgi, Sr. Adv. Mr. Gaurav Pachnanda, Sr.Adv. Mr. Sidhant Goel, Adv. Mr. Mohit Goel, Adv. Ms. Garima Bajaj, AOR Mr. Dipankar Mishra, Adv. Ms. Karmanya Dev Sharma, Adv. Mr. Udbhav Gady, Adv. For Respondent(s): Mr. Saikrishna Rajagopal, Adv. Mr. Sidharth Chopra, Adv. Ms. Sneha Jain, Adv. Mr. Devvrat Joshi, Adv. Mr. Angad Makkar, Adv. Ms. Swikriti Singhania, AOR
Unconditional stay of execution of a money decree can be granted if exceptional circumstances justify it, overriding the usual requirement for a deposit or security under the Code of Civil Procedure.
Headnote:(A) Code of Civil Procedure, 1908 - Order XLI Rule 5(1) and (3) - Appeal against money decree - Unconditional stay on execution of decree granted by High Court which awarded damages of Rs. 336,02,87,000/- - High Court found serious irregularities in service of summons to the defendant, leading to ex parte decree which lacked full legal backing - Court noted that no specific findings of involvement in the alleged infringement against the defendant existed, as the purported claims for damages were not sufficiently substantiated or pleaded. (Paras 1, 4, 8, 134, 135 and 138)
(B) The requirement of showing sufficient cause for granting stay of execution of a decree is imperative, and the presence of exceptional circumstances may justify a grant without the mandated conditions of deposit. (Paras 3, 135)
(C) The appellant's arguments regarding the lack of jurisdiction due to non-service of summons at the outset are validated, warranting the need for due process in civil litigation. (Paras 81, 134)
(D) The Division Bench ruled to examine both procedural irregularities and the substantive issues concerning the plaintiffs' requests for damages, ultimately leading to the stay of execution while upholding core legal principles. (Paras 49, 134)
Legal Category Hierarchy
Table of Contents
2. Plaintiffs argue mandatory deposit/security under Order XLI Rule 5 for stay — Defendant contends discretion for unconditional stay exists in exceptional cases. (Para 20 , 21 , 22 , 23 , 24 , 25 , 26 , 28 , 29 , 30 , 31 , 32 , 33 , 35 , 36 , 37 )
3. Order XLI Rule 1(3) is directory — Unconditional stay permissible in exceptional cases — Valid service of summons is essential for jurisdiction — Decree was perverse. (Para 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57 , 58 , 59 , 60 , 61 , 62 , 63 , 64 , 65 , 66 , 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74 , 75 , 76 , 77 , 78 , 79 , 80 , 81 , 82 , 83 , 84 , 85 , 86 , 87 , 88 , 89 , 90 , 91 , 92 , 93 , 94 , 95 , 96 , 97 , 98 , 99 , 100 , 101 , 102 , 103 , 104 , 105 , 106 , 107 , 108 , 109 , 110 , 111 , 112 , 113 , 114 , 115 , 116 , 117 , 118 , 119 , 120 , 121 , 122 , 123 , 124 , 125 , 126 , 127 , 128 , 129 , 130 , 131 , 132 , 133 )
4. Order XLI Rule 1(3) is directory; unconditional stay of money decree is permissible in exceptional cases where the decree is perverse or riddled with patent illegalities. (Para 63 , 82 , 134 )
5. Petition dismissed — High Court's order granting unconditional stay of the money decree upheld. (Para 1 , 135 )
6. Is the deposit of the decretal amount mandatory for maintaining an appeal against a money decree?
No, Order XLI Rule 1(3) of the CPC is directory, not mandatory. Failure to deposit the amount or furnish security does not result in the rejection of the appeal, but it disentitles the appellant to the benefit of a stay of execution of the money decree. (Para 59 , 62 , 63 )
7. Can an appellate court grant an unconditional stay of a money decree?
Yes. While money decrees are ordinarily not stayed unconditionally, the appellate court has the discretion to do so in exceptional cases where the decree is egregiously perverse, riddled with patent illegalities, or facially untenable. (Para 64 , 70 , 82 , 134 )
8. What forms of security are acceptable for staying a decree under Order XLI Rule 5?
Security is not limited to cash deposits. It can be provided in the form of property, a bond, or an appropriate undertaking from the appellant to abide by the decree. (Para 85 , 86 , 87 , 134 )
9. What is the legal effect of failing to serve summons on a defendant in a civil suit?
Valid service of summons is a prerequisite for the court to acquire jurisdiction over a respondent. Without valid service, the court cannot proceed ex parte against the defendant, as proper service protects the right to due process. (Para 131 , 132 )
10. Does the second proviso to Section 36(3) of the Arbitration Act restrict unconditional stays in civil money decrees?
No. The analogy of the Arbitration Act is inappropriate for proceedings under the CPC. The discretionary power to grant a stay under Order XLI Rule 5 is independent of the specific fraud or corruption grounds mentioned in the Arbitration Act. (Para 95 , 122 , 123 )
JUDGMENT :
J.B. PARDIWALA, J.
For the convenience of exposition, this judgment is divided into the following parts:
| INDEX | |
| A. | FACTUAL MATRIX |
| B. | SUBMISSIONS ON BEHALF OF THE PLAINTIFFS |
| C. | SUBMISSIONS ON BEHALF OF THE DEFENDANT |
| D. | REJOINDER TO THE SUBMISSIONS CANVASSED ON BEHALF OF THE DEFENDANTS |
| E. | ANALYSIS |
| i. History of the Legislation in Question 18 | |
| ii. Principles required to be followed while Interpreting a Provision of a Statute | |
| iii. Decisions of various High Courts on the Subject | |
| iv. Meaning and Import of “sufficient cause” under Order XLI Rule 5 of the CPC | |
| v. Service of Summons and Irregularity in the Service of Summons | |
| vi. Reading of Section 36 of the Arbitration Act and Order XLI Rule 3 and Rule 5 respectively of the CPC | |
| vi. Relevant aspects which the High Court looked into for the purpose of granting unconditional stay | |
| F. | CONCLUSION |
1. Our Order dated 24.09.2025 passed in the instant petition reads thus:
“1. Exemption Application is allowed.
2. Heard Mr. Mukul Rohatgi and Mr. Gaurav Pachnanda, the learned Senior counsel appearing for the petitioners and Dr. Abhishek Manu Singhvi, Mr. Neeraj Kishan Kaul and Mr. Arvind Nigam, the learned Senior counsel appearing for the respondent.
3. We are of the view that there is no good reason for us to interfere with the impugned Judgment and Order passed by the High Court.
4. The Special Leave Petition is, accordingly, dismissed.
5. In view of the dismissal of the Special Leave Petition, no orders are required to be passed on the application for intervention/impleadment and the same stands disposed of.
6. However, reasons to follow by a separate Order.”
2. This petition arises from the judgment and order passed by the High Court of Delhi, dated 01.07.2052 in the CM Application No. 26455 of 2025 filed in the RFA(O.S.)(COMM) No. 11 of 2025 by which the application filed by the respondent herein (judgment debtor-original defendant) under Order XLI Rule 5(1) and Rule 5(3) of the CIVIL PROCEDURE CODE , 1908, (for short, “the CPC”) respectively came to be allowed, and thereby the Court stayed the operation of the judgment and money decree dated 25.02.2025 passed by a learned Single Judge in the suit instituted by the petitioner herein. In short, the Division Bench of the High Court granted stay of the execution of the money decree suffered by the respondent herein without insisting for the deposit of the decretal amount.
3. For the sake of convenience, the petitioners herein shall be referred to as the original plaintiffs and the respondent herein shall be referred to as the original defendant.
A. FACTUAL MATRIX
4. The plaintiffs along with its subsidiaries and licensees claim to be engaged in the business of manufacturing, distribution and sale of a wide range of products including garments, apparels, footwear for men, women and children, furniture, textiles, watches and other lifestyle/personal care products under the trademark Beverly Hills Polo Club (hereinafter referred to as “BHPC”).
5. The plaintiff No. 1 is an Amsterdam based company and is the proprietor of the BHPC trademark and claims to hold exclusive rights for its use and commercialisation. The BHPC trademark consists of a distinctive look featuring a charging Polo pony with a mounted rider wielding a raised polo stick (mallet) symbolising the sport of Polo.
6. The plaintiff no. 2 is the licensee of the said trademark pursuant to the Master License and Licensing Service Agreement dated 20.05.2008.
7. The plaintiffs instituted Civil Suit (COMM) No. 443 of 2020 in the Delhi High Court, inter alia, seeking permanent injunction and damages against the defendant for the alleged infringement of their registered trademark BHPC.
8. It is the case of the plaintiffs that they are the rightful proprietors of the BHPC Mark which enjoys extensive goodwill and recognition in the domestic and international markets. The plaintiffs instituted the suit contending that the
