Delhi High Court Emphasizes Strict Adherence to Document Filing Timelines in Commercial Suits

New Delhi: In a significant ruling underscoring the strict procedural requirements governing commercial litigation in India, the Delhi High Court has dismissed an application by TTK Prestige Limited seeking to place additional documents on record in its trademark infringement suit against Baghla Sanitaryware Private Limited & Ors. Justice Anish Dayal , in an order dated February 7, 2024, held that the plaintiff failed to establish a "reasonable cause" for the delayed filing, reiterating that the timelines prescribed under the Commercial Courts Act, 2015, are "strict and sacrosanct."

The judgment pertains to an application (I.A. 13421/2023) filed by the plaintiff under Order XI Rule 1(5) of the Code of Civil Procedure, 1908, as amended by the Commercial Courts Act. This provision requires plaintiffs to disclose all relevant documents along with the plaint and permits reliance on subsequently discovered or disclosed documents only with the court's leave upon establishing a "reasonable cause" for the initial non-disclosure.

Case Background

TTK Prestige had filed a suit (CS(COMM) 281/2021) in June 2021 alleging infringement of its registered trademark 'PRESTIGE' and logo, claiming continuous, extensive, and exclusive use in India since 1955 for kitchenware. The defendants, engaged in the business of sanitaryware and bath fittings, were accused of using the 'PRESTIGE' mark, which they claimed to have been using since 2005 based on a registration in Class 11.

An ex-parte ad interim injunction was granted in June 2021, restraining the defendants from using the mark 'PRESTIGE' for sanitaryware and allied goods. The defendants filed their written statement in July 2021, claiming prior use since 2005, followed by the plaintiff's replication in September 2021.

In August 2022, the defendants filed an application to place additional invoices from 2012-2016 on record, which the court allowed in February 2023, noting that trial had not yet commenced and citing the Supreme Court's decision in Sugandhi & Anr. v. P. Rajkumar .

Subsequently, in July 2023, nearly two years after filing the replication, the plaintiff filed the instant application to place on record promotional material and CA certificates dating back to 1959-1989, purporting to evidence their early use of the mark.

Arguments Presented

Plaintiff's Submissions:

• The additional documents were necessitated as a rebuttal to the defendants' claim of use since 2005 and their subsequently filed documents.
• Old records prior to 2007 were not readily available when the suit was filed but were later discovered in a disposed of suit from 1991.
• The application should be allowed on the same parameters as the defendants' earlier application, which was permitted despite being filed late, particularly since trial had not commenced.
• Relied on Order XI Rule 1(5) CPC and argued "reasonable cause" was established.
• Cited Sugandhi and Vijay Kumar Varshney (a Delhi HC decision allowing additional documents in a commercial suit as rebuttal) arguing procedural flexibility should be granted when no prejudice is caused.

Defendants' Counterarguments:

• The application was highly belated and mala fide, attempting to introduce documents that should have been filed with the plaint or replication.
• The documents were clearly within the plaintiff's knowledge (as they were from a prior suit involving the plaintiff's predecessor).
• Plaintiff failed to exercise diligence required under the strict regime of the Commercial Courts Act.
• Highlighting the chronology, defendants pointed out that the certified copies of these documents were obtained in February 2023, before the hearing on the defendants' application, yet the plaintiff waited five months to file their own application.
• Cited CEC-CICI JV & Ors. v. Oriental Insurance Company Limited (a Delhi HC decision emphasizing strict application of Commercial Courts Act timelines) to argue that negligence does not constitute "reasonable cause" under Order XI Rule 1(5) CPC.

Court's Analysis and Reasoning

Justice Dayal meticulously reviewed the arguments and the relevant legal provisions and precedents. The Court drew a crucial distinction between the procedural flexibility noted in judgments like Sugandhi and the strict regime governing commercial suits under the Commercial Courts Act.

The Court noted that Sugandhi pertained to a normal civil suit under Order VIII Rule 1-A(3) CPC, which is different in scope from Order XI Rule 1(5) CPC applicable to commercial suits. The Statement of Objects and Reasons of the Commercial Courts Act, and the Supreme Court's observation in Ambalal Sarabhai Enterprises Ltd. vs. K.S Infraspace LLP , emphasize the need for "early" and "speedy" disposal of commercial disputes, necessitating a "strict construction" of its provisions.

The Court highlighted Order XI Rule 1(1), 1(3), and 1(5) CPC (as amended) which mandate comprehensive disclosure of documents at the plaint stage with a declaration that no other documents are in the plaintiff's power or possession. Leave to file later is conditional upon establishing "reasonable cause."

Rejecting the plaintiff's arguments, the Court found a clear lack of diligence:

> "Plaintiff’s claim that the instant application was necessitated in rebuttal of the defendants’ documents filed in February, 2023, does not find favor with this Court. Strict deadlines of the Commercial Courts Act ought to hang like Damocles’ sword over contesting parties, since that is what is intended by the modified provisions of the Code of Civil Procedure, 1908. A party intending to injunct a defendant from using a mark similar to theirs, cannot possibly be tardy or dilatory in marshalling their documents."

The Court further noted that the plaintiff knew about the documents' existence in a prior suit and obtained certified copies in February 2023, yet inexplicably waited five months to file the application. This delay, especially when they had an opportunity to mention their intention to file additional documents during the hearing of the defendants' application in February 2023, demonstrated a lack of "reasonable cause."

While acknowledging the defendants' application for additional documents was allowed, the Court stated that this did not give the plaintiff a "carte blanche" to introduce documents belatedly.

The Court relied heavily on the principles laid down in Oriental Insurance Company , which, citing other judgments like Sudhir Kumar @ S. Baliyan , Bela Creation Private Limited , Nitin Gupta , and Rishi Raj , established that "reasonable cause" cannot extend to negligence and that Commercial Divisions must enforce deadlines strictly to prevent commercial suits from suffering the same delays as ordinary suits.

> "...the requirement of establishing the reasonable cause for non disclosure along with plaint shall not be applicable if it is averred and it is the case of the plaintiff that those documents have been found subsequently and in fact were not in the plaintiff's power, possession, control or custody at the time when the plaint was filed. Therefore Order XI Rule 1(4) and Order XI Rule 1(5) applicable to the commercial suit shall be applicable only with respect to the documents which were in plaintiff's power, possession, control or custody and not disclosed along with plaint. Therefore, the rigour of establishing the reasonable cause in non disclosure along with plaint may not arise in the case where the additional documents sought to be produced/relied upon are discovered subsequent to the filing of the plaint." ( Sudhir Kumar quoted in Oriental Insurance Company )

> "“Reasonable cause”, within the meaning of Order XI Rule 1(10) of the CPC, as amended by the Commercial Courts Act, cannot extend to negligence in filing of documents before the Court. “Reasonable cause”, necessarily, must refer to a cause which was outside the control of the petitioner, and which prevented the petitioner from filing the concerned documents along with the written statement.” ( Bela Creation Pvt. Ltd. quoted in Oriental Insurance Company )

Decision and Implications

Finding that the plaintiff had failed to establish a "reasonable cause" for the non-disclosure and subsequent significant delay in filing the documents, the Court dismissed the application (I.A. 13421/2023).

The ruling reinforces the stringent procedural discipline expected in commercial litigation under the Commercial Courts Act. Parties are required to be diligent in identifying and disclosing all relevant documents at the earliest stage. Claims of later discovery or the need for rebuttal, while potentially relevant in specific circumstances (as distinguished from Vijay Kumar Varshney ), will not override the fundamental requirement of demonstrating a reasonable and non-negligent cause for failing to meet the statutory timelines, particularly when the documents were known to exist and certified copies obtained well in advance of filing the application. The judgment serves as a reminder that procedural compliance is paramount for achieving the objective of swift resolution in commercial disputes.

The matter is now listed before the Joint Registrar for further proceedings on February 15, 2024.