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* IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on: 04.03.2021

% Pronounced on: 09.11.2021

+ CS(COMM) 455/2020

DR REDDYS LABORATORIES LIMITED ..... Plaintiff

Through Mr.Ranjan Narula, Adv.

Versus

DR REDDY PATHLABS PRIVATE LIMITED ..... Defendant

Through Ms.Shwetasree Majumder, Ms.Diva
Arora and Ms.Eva Biswal, Advs.

CORAM:
HON'BLE MR. JUSTICE JAYANT NATH

JAYANT NATH, J.
I.A. 102/2021
1. This is an application under Order 7 Rule 10 read with Order 7 Rule
11(a) and (d) CPC filed by the defendant seeking rejection of the
plaint/return of the plaint to be presented before a court of competent
jurisdiction.
2. The plaintiff has filed the accompanying suit seeking an order of
permanent injunction to restrain the defendant, its directors, etc. from
offering/providing healthcare services including pathology/diagnostic
services, etc. under the name/mark DR. REDDYS as part of its domain
name/website/trade name, etc. which amounts to infringement of the
plaintiff‟s trade name/mark DR.REDDY‟S which is a registered mark in

CS(COMM) 455/2020 Page 1 of 12

class 5 and 44. Other connected reliefs are also sought.
3. It is the case of the plaintiff that the plaintiff‟s mark DR.REDDY‟S is
registered in India in class 5 since 2001. The plaintiff has also obtained
various registrations of the mark DR.REDDY‟S in class 5 and 44. In August
2020, the plaintiff‟s attention was invited by its representative to a website
being operated under the name www.drreddyspathlabs.com. The plaintiff
was shocked to learn about the illegal and unauthorised business activities of
the defendant/use of an identical trade mark/trade name „DR.REDDYS‟ as
part of domain name/website/trade name. Hence, the present suit.
4. The defendant has filed the aforesaid application stating that this court
does not have territorial jurisdiction to hear the present suit. The registered
offices of both the parties are located at Hyderabad. The defendant is not
conducting any business in Delhi and no part of cause of action has arisen
within the jurisdiction of this court. It is also urged that Section 134 of the
Trade Marks Act has no application to the facts of this case as though the
corporate office of the plaintiff is situated in Delhi but a suit for
infringement can be filed only at a place where the plaintiff‟s registered
office is located. Additionally, it is urged that Section 134 of the Trade
Marks Act is relevant only for the purposes of infringement of the trade
mark. It is urged that the present suit is a composite suit for passing off and
unfair competition. Hence, the present application.
5. I have heard learned counsel for the parties. I have also perused the
written submissions filed by the defendant.
6. Learned counsel for the defendant has relied upon the judgment of the
Supreme Court in the case of Indian Performing Rights Society Ltd. vs.
Sanjay Dalia & Anr., (2015)10SCC 161 to plead that a suit for infringement

CS(COMM) 455/2020 Page 2 of 12

of trade mark can only be filed at the place where the plaintiff‟s registered
office is located. Reliance is also placed on Section 134 of the Trade Marks
Act. Reliance is also placed on a judgment of a Division Bench of this court
in the case of Banyan Tree Holding (P) Ltd. vs. A. Murali Krishna Reddy
& Anr., 2010 (42) PTC 361 (Del.) to claim that merely because the
defendant‟s website is accessible in Delhi, is not a ground for concluding
that any part of cause of action has arisen in Delhi. Hence, Section 20(c)
CPC would also have no application to the present case. Hence, it is pleaded
that this court does not have territorial jurisdiction to entertain the present
suit and appropriate directions be passed by this court.
7. I may first look as to when the court would exercise powers under
Order 7 Rule 10 CPC to return the plaint on account of lack of territorial
jurisdiction.
8. The settled legal position is that while considering an application
under Order 7 Rule 10 CPC, only averments made in the plaint and the
documents filed along with the plaint need to be seen. In this context
reference may be made to the judgment of the Division Bench of this court
in the case of M/s. RSPL Ltd. vs. Mukesh Sharma & Anr., (2016) 232 DLT
161 where the court held as follows:-
“11. It must be stated that it is a settled proposition of law that
the objection to territorial jurisdiction in an application under
Order 7 Rule 10 CPC is by way of a demurrer. This means that
the objection to territorial jurisdiction has to be construed after
taking all the averments in the plaint to be correct. In Exphar
SA v. Eupharma Laboratories Limited : (2004) 3 SCC 688, the
Supreme Court observed that when an objection to jurisdiction
is raised by way of demurrer and not at the trial, the objection
must proceed on the basis that the facts, as pleaded by the
initiator of the impugned procedure, are true. The Supreme

CS(COMM) 455/2020 Page 3 of 12

 Court further observed that the objection as to jurisdiction in
order to succeed must demonstrate that granted those facts, the
Court does not have jurisdiction as a matter of law. It is also a
settled proposition of law that while considering a plaint from
the standpoint of Order 7 Rule 10 CPC, it is only the plaint and
the documents filed along with it, that need to be seen. The
written statement is not to be looked into at all.”

9. Reference may also be had to a judgment of a Coordinate Bench of

this court in the case of Boston Scientific International B.V. vs. Metro
Hospital, (2007)136 DLT 278 where the court held as follows:-
“6. Having obtained unconditional leave to defend the suit, the
defendant has filed the present application under Order 7 Rule
10 for return of the plaint on the ground of lack of territorial
jurisdiction. Now, on the one hand we have an order of this
Court granting unconditional leave to defend on the ground that
a „triable issue‟ arises qua the plea of territorial jurisdiction and,
on the other, we have the present application wherein the
defendant seeks return of plaint without the issue being tried.
This, to me, seems a somewhat incongruous situation. A „triable
issue‟ means that the same requires to be decided after leading
of evidence. Whereas, the parameters of disposing of an
application under Order 7 Rule 10, CPC, at the initial stage
without going into evidence, requires the Court to only look at
the averments contained in the plaint.”

10. Clearly, what follows is that while considering an application under

Order 7 Rule 10 CPC, this court has to look at the averments made in the
plaint and the accompanying documents to adjudicate the said application.
11. I may now look at the averments made in the plaint. Paras 19 and 33
of the plaint read as follows:-
“19. The Plaintiff on close analysis of the Defendant's website
www.drreddyspathlabs.com noticed that the Defendant is
advertising and running its business under the trade name „Dr

CS(COMM) 455/2020 Page 4 of 12

 Reddys Pathlab Private Limited‟ and claiming as under on its
interactive website, which is accessible throughout India and also
to the general public residing within the jurisdiction of this
Hon'ble court.

OUR SERVICES:

....... Our diagnostic Services offers a wide range of test menu

including Pathology & Radiology to assist individuals,
organizations, and institutions around the world in pursuing
better health and well being. We process all kinds of

Biochemistry
Microbiology
Clinical Pathology
Histopathology
Molecular Biology &
Radiology samples

flown from all locations across India. The samples processed

generate results which undergo stringent review protocols before
integrated online for web based result reporting. These web based
result reporting allow individuals, organizations, and institutions
to explore easy, quick and cost effective process of result
evaluation.

Corporate Overview

Dr Reddys Path Labs Private Limited is a leading Testing

Service Laboratory in India providing Pathology, Radiology and
related testing services under one roof to customers around the
globe.

XXXX
33. That this Hon'ble Court has jurisdiction to entertain and try
the present suit under Section 134 of the Trade Marks Act, 1999
as the Plaintiff has its corporate office situated at NH-2, 2nd
Floor, C Block, Community Centre, Naraina Vihar, Delhi-

CS(COMM) 455/2020 Page 5 of 12

 l10028. That this Hon'ble Court has also jurisdiction as Plaintiff
is providing its services through its website www.drreddys.com
which is an interactive website and accessible to the consumers at
Delhi and the Plaintiff s products and services can be availed by
the consumers in Delhi. It is a settled position that the possibility
to conclude transactions through a website at a particular place is
virtually identical to a seller having a shop in that place in the
real world. Therefore, this Hon‟ble Court has the territorial
jurisdiction to try and entertain the present suit in view of Section
20 of CPC and Section 134(2) of the Trade Marks Act, 1999. The
Plaintiff submits that the Defendant is also carrying on business
of providing healthcare services, offering franchisee and know
how through the impugned website www.drreddyspathlabs.com.
The impugned website is an interactive one and allows for
transaction to be concluded anywhere including providing a chat
function on its website. The Defendant is further claiming to
provide its services throughout India including within the
jurisdiction of this Hon‟ble court and has also appointed various
franchisee in various parts of the country and thus the same
would further confer jurisdiction to the this Hon‟ble court to try
and entertain the present suit. The Defendant has also advertised
its services through various social media platforms including Just
Dial, Facebook and others, which are accessible to the general
public residing within the jurisdiction of this Hon'ble court. Thus,
this Hon'ble court has jurisdiction under Section 20 of the Code
of Civil Procedure, 1908.”

12. Hence, as per the plaint, the defendant is carrying on its business
throughout the country. It is also claimed that the defendant has appointed
various franchisees in various parts of the country. The aforesaid portion of
the website itself states that it can carry out necessary tests from samples
flown from all locations across India. Based on the above, it is urged in the
plaint that this court has territorial jurisdiction in view of Section 20 CPC as
a part of the cause of action has arisen within the territory of this court.
13. Reference may be had to Section 20 CPC. The same reads as

CS(COMM) 455/2020 Page 6 of 12

follows:-
“20. Other suits to be instituted where defendants reside or cause
of action arises.— Subject to the limitations aforesaid, every suit
shall be instituted in a Court within the local limits of whose
jurisdiction—

..........

(c) the cause of action, wholly or in part, arises.

Explanation 2[* * *].—A corporation shall be deemed to carry on

business at its sole or principal office in India or, in
respect of any cause of action arising at any place where it has
also a subordinate office, at such place.”

14. In this context reference may also be had to the judgment of the
Supreme Court in the case of A.B.C. Laminart Pvt. Ltd. & Anr. Vs. A.P.
Agencies, Salem, (1989) 2 SCC 163 where the Court on Section 20 CPC
held as follows:-
“12. A cause of action means every fact, which if traversed, it
would be necessary for the plaintiff to prove in order to support
his right to a judgment of the court. In other words, it is a bundle
of facts which taken with the law applicable to them gives the
plaintiff a right to relief against the defendant. It must include
some act done by the defendant since in the absence of such an
act no cause of action can possibly accrue. It is not limited to the
actual infringement of the right sued on but includes all the
material facts on which it is founded. It does not comprise
evidence necessary to prove such facts, but every fact necessary
for the plaintiff to prove to enable him to obtain a decree.
Everything which if not proved would give the defendant a right
to immediate judgment must be part of the cause of action. But it
has no relation whatever to the defence which may be set up by
the defendant nor does it depend upon the character of the relief
prayed for by the plaintiff.

CS(COMM) 455/2020 Page 7 of 12

 13. Under Section 20(c) of the Code of Civil Procedure subject to
the limitation stated theretofore, every suit shall be instituted in a
court within the local limits of whose jurisdiction the cause of
action, wholly or in part arises. It may be remembered that earlier
Section 7 of Act 7 of 1888 added Explanation III as under:

Explanation III.—In suits arising out of contract the cause of

action arises within the meaning of this section at any of the
following places, namely:
(1) the place where the contract was made;
(2) the place where the contract was to be performed or
performance thereof completed;
(3) the place where in performance of the contract any
money to which the suit relates was expressly or impliedly
payable.”

15. The question would come: Whether facts of this case, at this stage,
warrant rejection of the plaint on the ground of lack of territorial jurisdiction
of this court?
16. Reference in this context may be had to the judgment relied upon by
the learned counsel for the defendants in the case of Banyan Tree Holding
(P) Ltd. vs. A. Murali Krishna Reddy & Anr.(supra). That was a case in
which the plaintiff stated that the defendants have advertised their products
on their website. According to the plaintiff therein, the defendants solicit
their business through use of the impugned mark “BANYAN TREE
RETREAT” and the "Banyan" device mark in Delhi. It was alleged in that
case that the defendants had presence in Delhi through their website which
was accessible in Delhi. It was further stated that the website was not a
passive website. It not only provided contact information but also sought
feedback and inputs from its customers through an interactive web-page.

CS(COMM) 455/2020 Page 8 of 12

Further the plaintiff stated that the services of the defendants were being
offered to the customers in Delhi because of the ubiquity, universality and
utility of the features of the internet and the World Wide Web and hence, the
cause of action had arisen within the jurisdiction of this court. Hence, in the
referral order, the learned Single Judge referred the following questions to
the Division Bench:-
“1. Whether this court can entertain the present suit, having
regard to the averments and documents, in the context of special
provisions in to the Trademark and Copyrights Act, which do not
provide for exercise of jurisdiction based on internet or web-
presence of such alleged infringers, even while making explicit
departure from the general law as to territorial jurisdiction;

2. Whether the court can entertain the present suit, in the absence
of a long arm statute, having regard to the existing state of law,
particularly Section 20, CPC, and the impact, if, any of the
Information Technology Act, 2009 on it;

3. Applicable standards for entertaining a suit, based on use of a

trademark by a Defendant, on its website, or infringement or
passing off of the plaintiff‟s trademark, in such website and the
relevant criteria to entertain such suits;

4. Applicable standards and criteria where the plaintiff relies

exclusively on “trap orders” or transactions, in relation to passing
off, or trademark infringement cases, as constituting “use” or
cause of action, as the case may be.”

17. The Division Bench held as follows:-

“38. Having surveyed the law as it has developed in different
jurisdictions, this Court is of the view that the essential principles
developed as part of the common law can be adopted without
difficulty by our courts in determining whether the forum court
has jurisdiction where the alleged breach is related to an activity

CS(COMM) 455/2020 Page 9 of 12

 on the internet. At the outset, this court does not subscribe to the
view that the mere accessibility of the Defendants' website in
Delhi would enable this Court to exercise jurisdiction. A passive
website, with no intention to specifically target audiences outside
the State where the host of the website is located, cannot vest the
forum court with jurisdiction. This court is therefore unable to
agree with the proposition laid down in Casio. The said decision
cannot be held to be good law and to that extent is overruled.

xxx

Question (iii) Is it permissible for the Plaintiff to establish such

prima facie case through “trap orders” or “trap transactions”?

46. It may be recalled that the Plaintiff has to show that a part
of the cause of action in a suit for passing off or infringement has
arisen within the jurisdiction of the forum court. Relevant to this,
it would have to be shown by the Plaintiff that the Defendant
“availed” of the jurisdiction of the forum court by commercially
transacting with a viewer located in the forum state through the
internet. The question is whether this transaction can be a trap
transaction‟ that is engineered by the Plaintiff itself, particularly
when it is not otherwise shown that the Defendant intended to
specifically target customers in the forum state.

xxx
57. Reverting to the present case, the position that emerges
from the above judicial decisions is that while in trade mark and
infringement cases, trap orders or trap transactions may be used
as evidence, the fairness of such transactions is a relevant factor
to be considered. Other relevant factors would be the nature of
goods or services offered for purchase on the internet. If they
require the customer to further physically verify their quality then
the mere purchase of such goods through a trap transaction may
not be treated as being sufficient evidence of infringement. The
facts of each case will determine whether the trap transaction is a
fair one and has resulted in a purchase on the internet of goods or

CS(COMM) 455/2020 Page 10 of 12

 services. A lone trap transaction will not be sufficient evidence of
infringement or passing off. For the purposes of establishing that
a part of the cause of action arose within the jurisdiction of the
court, the Plaintiff would have to show that the Defendant has
purposefully availed of the jurisdiction of the forum court by
entering into a commercial transaction with an internet user
located within the jurisdiction of the forum court. This cannot
possibly be a solitary trap transaction since that would not be an
instance of “purposeful” availment by the Defendant. It would
have to be a real commercial transaction that the Defendant has
with someone not set up by the Plaintiff itself. If the only
evidence is in the form of a series of trap transactions, they have
to be shown to be obtained using fair means. The Plaintiff
seeking to establish jurisdiction on the basis of such trap
transactions would have to aver unambiguously in the plaint, and
also place along with it supporting material, to prima facie show
that the trap transactions relied upon satisfy the above test.
Question (iii) is answered accordingly.

Summary

58. We summarise our findings on the questions referred for our

opinion as under:

xxx

Question (iii): Is it permissible for the Plaintiff to establish such

prima facie case through “trap orders” or “trap transactions”?

Answer: The commercial transaction entered into by the

Defendant with an internet user located within the jurisdiction of
the forum court cannot possibly be a solitary trap transaction
since that would not be an instance of “purposeful” availment by
the Defendant. It would have to be a real commercial transaction
that the Defendant has with someone not set up by the Plaintiff
itself. If the only evidence is in the form of a series of trap
transactions, they have to be shown as having been obtained
using fair means. The Plaintiff seeking to establish jurisdiction

CS(COMM) 455/2020 Page 11 of 12

 on the basis of such trap transactions would have to aver
unambiguously in the plaint, and also place along with it
supporting material, to prima facie show that the trap transactions
relied upon satisfy the above test.”

18. The reliance of the learned counsel for the defendant on the above
judgment of the Division Bench of this court in case of Banyan Tree
Holding (P) Ltd. vs. A. Murali Krishna Reddy & Anr.,(supra) is misplaced.
In this case, there are no trap transactions. As per the plaint and the website
of the defendant, the defendant is offering its services throughout the
country including in Delhi. What the defendant, as per the plaint, is offering
is physical services in Delhi, namely, collection of samples which will then
be flown over to the location of the laboratory of the defendant. It is not an
internet based transaction that is being sought to be made. The plaint and the
accompanying documents are the only documents which have to be seen at
this stage. It is apparent that as per the plaint the services are being
physically offered in Delhi. A part of cause of action as per the plaint has
arisen within the territory of Delhi.
19. It is not possible to reach at a conclusion that no cause of action has
arisen within the territorial jurisdiction of this court at this stage. After the
parties have led their evidence that any final conclusion can be made.
20. There is clearly no merit in the present application and the same is
dismissed.
CS(COMM) 455/2020
List before the Joint Registrar on 22.11.2021 for further proceedings.

JAYANT NATH, J.
NOVEMBER 09, 2021/rb

CS(COMM) 455/2020 Page 12 of 12