IN THE HIGH COURT OF ORISSA, CUTTACK

CRP No.09 of 2021

In the matter of an application under Section 115 of the Code

of Civil Procedure, 1908.

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KD Gold and Diamonds

Private limited ....... Petitioner

-Versus-

M/s. Khimji and Sons ....... Opp. Party

For Petitioner: - Mr. M. Vashisht, Sr. Advocate,

M/s. S.K. Mohanty,
J. Mohanty, & R.R. Dash

For Opposite party: - Mr. G. Mukherji, Sr. Advocate,

M/s. S.D. Ray, M. Wright,
M. Agrawal, K. Banerjee,
A. Mishra, S. Acharya &
D.K. Dash

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P R E S E N T:

MR. JUSTICE BISWAJIT MOHANTY

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Date of Hearing: 13.10.2022 Date of Judgment: 20.10.2022
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B. Mohanty, J. The present Civil Revision has been filed by the

petitioner praying for quashing of the order dated 01.10.2021

passed by the learned District Judge,Khurda at Bhubaneswar in

C.S. No.02 of 2021 under Annexure-1. It has also prayed for

rejection of the plaint or to pass any order/orders as would be

deemed fit and proper.

2. According to the petitioner/defendant, the opposite

party/plaintiff herein filed the above noted Civil Suit alleging

infringement of trade mark by suppressing many material facts

and documents before the learned District Judge, Khurda and

obtained an interim order temporarily restraining the present

petitioner/defendant from infringing trade mark “Khimji” of the

opposite party/plaintiff. On 09.06.2021 vide Annexure-6, the

learned District Judge, Khurda transferred the case record to

the Court of learned Sr. Civil Judge (Commercial Court),

Bhubaneswar for disposal of the same according to law

notwithstanding the objection of the petitioner/defendant that

since the specified value of the present suit was valued by the

opposite party/plaintiff was Rs.1,00,000/-, the same cannot be

transferred as the minimum pecuniary jurisdiction of the

Commercial Court as per State Government notification was

Rs.5,00,000/-. This has been averred at para 7 of the Civil

Revision Petition. On 01.07.2021, the opposite party/plaintiff

filed a petition under Order-6, Rule 17 under Annexure-23

before the Commercial Court, Bhubaneswar for change of its

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name and for introducing the specified value of the subject of

dispute to be at Rs.499.899 Crores. The petitioner/defendant

filed his reply to the said petition under Annexure-9, which is

same as Annexure-24 opposing the prayer for amendment.

While such was the position, vide order dated 07.07.2021 under

Annexure-10, the learned Commercial Court transferred the

case back to the learned District Judge, Khurda considering the

lack of jurisdiction holding therein that the plaintiff has

choosen his option to value the suit at Rs.1,00,000/- and the

said value can be taken into account for determining the

specified value and in view of the relevant provisions of the

Commercial Courts Act, 2015 for short ‘the Act’ and in view of

the notification dated 11.12.2020 of the Government of Odisha

specifying the pecuniary value of the commercial disputes to be

not less than Rs.5,00,000/-, the Commercial Court had no

pecuniary jurisdiction to entertain the suit. It is not disputed

that none has challenged the order dated 07.07.2021. After the

matter was transferred back to the learned District Judge,

Khurda, the petitioner/defendant filed a petition under Order-7,

Rule-11 on 15.07.2021 before the learned District Judge which

has been enclosed as Annexure-11. Under Annexure-14, the

opposite party/plaintiff filed its objection to such petition. While

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so, vide order dated 19.07.2021 under Annexure-12, the learned

District Judge partly allowed the Order-6, Rule-17 petition filed

by the opposite party/plaintiff. While it allowed the proposed

amendment at Sl. Nos.1 & 2 of the Order-6, Rule 17 petition

however, the learned Court rejected the prayer for proposed

amendment at Sl. Nos.3 & 4 as indicated in the Order-6, Rule

17 petition wherein an attempt was made by the opposite

party/plaintiff to incorporate the specified value of the subject

matter of the dispute i.e. market value of the trade marks right

of mark “Khimji” owned by plaintiff valued at Rs.499.899 Crores

in the plaint. It is not disputed by both the parties that none has

challenged this order dated 19.07.2021 under Annexure-12.

Ultimately, vide impugned order dated 01.10.2021 under

Annexure-1, the learned District Judge, who did not allow the

application of the opposite party/plaintiff for introduction of

specified value i.e. the market value of the trade mark valued at

Rs.499.899 Crores, relying upon the averments made at para-22

of the plaint regarding turnover of the opposite party/plaintiff

which was Rs.1,37,56,229/- for the year 2019-20 determined

such turn over as the specified value of the lis and transferred

the case again to the Sr. Civil Judge (Commercial Court),

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Bhubaneswar. Challenging the order under Annexure-1, the

present Civil Revision has been filed.

3. Mr. M. Vashisht, learned Sr. Advocate for the

petitioner/defendant submitted that once the learned District

Judge, Khurda came to a conclusion that the valuation suit

warranted that the matter should be decided by the Commercial

Court, he should have rejected the plaint as prayed for by the

opposite petitioner/defendant and should not have transferred

the same to the Commercial Court. Secondly, he submitted that

once the matter came within the purview of ‘the Act’ and since

though the suit was filed on 22.02.2021 without any application

filed under Order-39, Rule-3 and since the urgent petition

under Order-39, Rule-3 read with Section 151 of C.P.C. was filed

and moved later on 01.03.2021 after a gap of more than a week,

it showed that there was no urgency in the matter and since the

opposite party/plaintiff filed the suit without taking recourse to

Pre-institution mediation as provided under Section 12-A of ‘the

Act’, on that ground alone, the learned District Judge should

have rejected the plaint. In this connection he relied upon the

decision of the Supreme Court in the cases of M/s. Patil

Automation Private Limited & others Vs. Rakheja Engineers

Private Limited, 2022 (12) SCALE 153. Thirdly, he submitted

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that on 13.11.2020 the State had notified for the establishment

of Commercial Courts at the level of Sr. Civil Judge in the

District of Sambalpur, Berhampur, Cuttack and Khurda in

supersession of the earlier notification dated 28.10.2017.

Therefore, opposite party/plaintiff should have filed the suit

before the said Court since the lis was covered under ‘the Act’

instead of filing of the same before the learned District Judge. In

this connection, he further submitted that even though by the

date the suit was filed i.e on 22.02.2021 though the above noted

Commercial Courts have not been made functional however, in

the background of doctrine of necessity as espoused by the

Supreme Court in the case of Election Commission of India

and another Vs. Dr. Subramaniam Swamy and another,

(1996) 4 SCC 104, the opposite party/plaintiff should have filed

the suit before the Civil Judge, Sr. Division at Khurda. That not

having been done, he submitted that the plaint should have

been rejected on this account.

4. Mr. G. Mukherji, learned Sr. advocate appearing for

the opposite party/plaintiff submitted that a perusal of the

plaint would show that it is primarily a suit for injunction and

valuation of such suit does not depend upon the valuation of the

property involved. He also submitted that the turnover as

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indicated in the plaint cannot be taken to be the market value of

its trade mark rights. He further submitted that in the plaint

there exists no estimation by the opposite party/plaintiff with

regard to market value of its trade mark rights. He also

submitted that the learned court below has gone wrong in

determining the specified value on the basis of the turnover

figures. He reiterated that the suit filed by the opposite

party/plaintiff is principally for injunction when an intangible

right of his in the form of trade mark was misused and

accordingly, it has valued the suit at Rs.1,00,000/-. In such

background, he submitted that no wrong has been committed

by the learned District Judge in not rejecting its plaint however,

by transferring the suit to the learned Commercial Court on the

basis of a wrong reading of fact and law and by assessing the

specified value at Rs.1,37,56,020/- which was not at all there in

the plaint, the learned court below has committed a mistake. In

such background, he submitted that the learned court below

has gone wrong in transferring the suit to the Commercial Court

as the same has been valued at less than Rs.5,00,000/-. He also

submitted that the opposite party/plaintiff has filed C.M.P.

No.615 of 2021, in which the present petitioner/defendant has

already entered appearance, challenging the same impugned

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order and praying that the present impugned order be set aside

and the suit be transferred back to the learned District Judge,

Khurda to proceed further in accordance with law. He also

submitted that since its suit has been valued at Rs.1,00,000/-

only, the same should be tried only by the learned District

Judge as suit with such valuation will not come under the

provisions of ‘the Act’. In this context, he relied upon the

decisions rendered by Rahasthan High Court in the case of

Neelkanth Healthcare Pvt. Ltd., Jodhpur Vs. M/s. Neelkanth

Minechem Partnership Firm, Jodhpur, AIR 2018 Rajasthan

67. With regard to contention of Mr. Vashisht that the suit was

filed on 02.02.2021 without any application filed under Order

39, Rule-3, he submitted the same is not correct as such

application was filed on the same date and the reference to the

same is there in order dated 22.02.2021 under Annexure-3,

wherein it has been clearly mentioned that another petition was

filed praying for ex-parte hearing. On the same date, P.O. was

on leave and though the same was adjourned to 03.03.2021,

however a motion was made on 25.02.2021 for taking up the

hearing. On that date, the learned District Judge directed for

removal of defects and for putting up the matter on 01.03.2021

and accordingly temporary restraint order was passed on

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01.03.2021. With regard to submission of Mr. Vashisht that

once vide notification dated 13.11.2000, the State Government

had notified Civil Judge (Senior Division), Bhubaneswar as a

Commercial Court, therefore the opposite party/plaintiff should

have filed the suit before the said Court, Mr. Mukherji submitted

that the said notification made it clear that the establishment of

such Commercial Court would be with effect from the date from

which such Court would become functional. According to him,

such Courts were made functional w.e.f. 07.06.2021 and since

the suit in the present case with valuation of Rs.1,00,000/- was

filed on 22.02.2021, it was rightly filed before the learned

District Judge. In this context, he relied on the decision of the

Calcutta High Court rendered in the case of Sayan Sarker Vs.

Austin Distribution Private Limited, AIR 2021 Calcutta 169.

5. Heard Mr. M. Vashisht, learned Sr. Advocate for the

petitioner and Mr. G. Mukherji, learned Sr. Advocate for

opposite party.

6. It is well settled that in a matter involving a prayer

for rejection of plaint averments made in the plaint are only

material and are to be scanned. A perusal of the plaint under

Annexure-2 series shows that the opposite party/plaintiff has

filed the suit for infringement of trade mark under Section 134

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of the Trade Marks Act, 1999. At para-22, the opposite

party/plaintiff has indicated its turnover for the year 2005-2007

at Rs.26,94,386/- and for the year 2019-2020 at

Rs.1,37,56,020/- and it has also indicated at para-25 that the

prayer for injunction is valued at Rs.1,00,000/- for the purpose

of court fee and jurisdiction. The plaint nowhere indicates

market value of trade mark rights of the plaintiff as estimated by

it. It is not disputed that for the purpose of present case, the

only relevant provision is Clause (d) of Sub-Section (1) of Section

12 of ‘the Act’ as the right involved in this case is an intangible

right. As per the said clause, the market value of the intangible

right as estimated by the plaintiff (emphasis supplied) shall be

taken into account for determining specified value. As indicated

earlier, in the plaint no such estimation of market value of the

trade mark rights of plaintiff has been indicated by the plaintiff.

It is further well settled that in a suit for injunction, court fee is

payable on the amount at which relief is valued and for the

purpose of suit valuation, valuation of property is not material.

A reading of the prayer at para-26 also shows that the suit is

primarily a suit for injunction. Though a prayer has been made

for delivery accounts of profits, however, the opposite

party/plaintiff has not quantified the same amount as at the

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stage of filing of suit the plaintiff may not be a position to know

the quantum of such profits. It is equally well settled that when

such a prayer for accounts is made, the plaintiff can put a

tentative valuation. Correct amount can only be ascertained

when accounts are examined and ordinarily the Court is not

supposed to examine the correctness of valuation at the

inception of the suit as the real value can only come to the

picture after a suit is decreed.

Further a reading of Section 2 (1)(i) of ‘the Act’ makes

it clear that specified value relating to a commercial dispute

means the value of the subject matter in respect of a suit as

determined in accordance with Section 12 of ‘the Act’. A perusal

of Section 12 of ‘the Act’ as indicated earlier shows that the

relevant provision of law vis-à-vis that Section for our purpose is

Clause-(d) of Sub-Section-1 of Section 12 which makes it clear

that where the relief sought in a suit relates to intangible right,

the market value of the said right as estimated by the plaintiff

shall be taken into account for determining the specified value.

Here it is not disputed that there exists no such estimation of

the market value of the trade mark rights whose infringement is

sought to be protected by the opposite party/plaintiff in the

plaint. It may further be noted here that though the opposite

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party/plaintiff wanted to amend its plaint for incorporating its

estimation of the specified value of the subject matter i.e the

market value of its trade mark rights at Rs.499.899 Crores,

however, the same was not allowed by the learned District Judge

himself vide order dated 19.07.2021 under Annexure-12.

Further while returning the plaint to the learned District Judge,

the Commercial Court, Bhubaneswar vide its order dated

07.07.2021 vide Annexure-10 has clearly observed that since

the present plaintiff has choosen its option to value the suit at

Rs. 1,00,000/-, the said value can be taken into account to

determine the specified value. This order has not been

challenged by anybody. In such background, the question arises

as to whether by determining the specified value at

Rs.1,37,56,020/- by relying upon the turnover given by the

plaintiff, the learned District Judge acted with material

irregularity? The answer to this question should be a resounding

yes. As indicated above specified value in respect of an

intangible right in trade mark depends upon the market value of

the said right “as estimated” by the plaintiff. Here, admittedly,

the opposite party/plaintiff has not indicated its estimation of

such value in the plaint and when he wanted to incorporate the

same by amendment, that was negatived by the learned District

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Judge vide order dated 19.07.2021 under Annexure-12. In such

background, he ought not to have entered into the exercise of

determining the specified value in absence of clear cut

estimation of the same given by the plaintiff in the plaint

particularly, when he himself has earlier rejected the

introduction of the specified value by way of an amendment.

This exercise of the learned District Judge also creates difficulty

in the background of existence of order dated 07.07.2021 under

Annexure-10 passed by the learned Sr. Civil Judge (Commercial

Court), Bhubaneswar making an observation that the value of

the suit of the plaintiff at Rs.1,00,00/- can be taken into

account for determination of specified value, which has not been

challenged by anybody. In this context, a reference can also be

made to the grounds of challenge as indicated in Civil Revision

petition itself at grounds No. A, B, C, D & E, which are quoted

here under.

“A. For that, the present suit does not

fulfils the test and ingredients of ‘specified value’ as
per the Commercial Court Act, 2015 and further
the present suit was never filed as a Commercial
case as per the provisions of the Act, hence liable to
be dismissed on this ground alone.
B. That the suo motu valuation of the
present suit by enhancing the valuation to Rs.1.37
Crores and transferring it to Commercial Court is
against the provisions Court fee valuation as the
opposite party has never valued its suit at such
amount.

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 C. For that the prayer for amendment of
the opposite party with respect to specified value
being rejected by the Court in the order dated
19.07.2021, there was no occasion for the Court to
subsequently give its own interpretation and
consider a figure mentioned in the plaint to be the
specified value as has been done in the order dated
01.10.2021. Hence the impugned order is liable to
be set aside on this ground alone.
D. For that the Court of the District
Judge was not acting as a court of appeal so as to
send the matter back to the Commercial court
when the suit court has already given an
observation that the specified value was Rs.1 lakh
and had sent the matter back to the court of
District Judge on 07.07.2021.
E. For that, the District Judge decided
the amendment application under Order-6, Rule-17
vide order dated 19.07.2021 wherein the prayer of
the plaintiff seeking amendment of the specified
value was rejected. That order having attained
finality could not have been recalled or reviewed by
any subsequent order by the same court.”

A combined reading of all these valid grounds would

show that there was no occasion for the learned District Judge

to subsequently give its own interpretation and to consider the

figure mentioned in the plaint towards turnover to be specified

value as has been done in order dated 01.10.2021 when no

estimation of market value of trade mark rights was provided by

the plaintiff in plaint itself. Therefore, in the background of the

well settled principles of law that in a matter involving rejection

of plaint only the averments made in the plaint are material and

nothing else can be taken into consideration, this Court is of the

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opinion that the suit filed by the plaintiff being principally a suit

for injunction and since it has been valued at Rs.1,00,000/-

despite being a commercial dispute cannot go before the

Commercial Courts constituted under ‘the Act’ as the same was

not covered under ‘the Act’ on account of less valuation. ‘The

Act’ does not say that all kinds of commercial disputes should

be tried before the Commercial Courts created by ‘the Act’. Only

those commercial disputes so far as Odisha is concerned whose

specified value is more than Rs.5,00,000/- should be brought

before the Commercial Courts or transferred to the Commercial

Courts not all commercial disputes. In Neelkanth Healthcare

Pvt. Ltd., Jodhpur (supra) Rajasthan High Court has made it

clear that Civil Court’s jurisdiction is not barred in Commercial

dispute when the specified value does not exceed the prescribed

limit. This Court humbly agrees with such opinion of Rajasthan

High Court. However, one thing is made clear that if the learned

District Judge was not satisfied with the valuation of the suit, he

should have required the plaintiff to correct the valuation and to

pay appropriate court fees on such valuation/revaluation after

giving the plaintiff an opportunity on the issue of valuation. This

has also not been done in the present case. In such background,

this Court is of the opinion that the learned court below has

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committed material irregularity in determining the specified

value and in passing the consequential order of transfer.

Therefore, the submission of the learned counsel for the

petitioner that once the Court came to a conclusion that the

matter should be tried under ‘the Act’ on the basis of the

recalculation of specified value, it should have rejected the

plaint, cannot be accepted as this Court has come to a

conclusion that the present matter is not at all covered by ‘the

Act’. Since the present case is not covered by ‘the Act’, no

question of violation of Section 12-A of the said Act arises and,

accordingly, the decision cited by the learned counsel for the

petitioner/defendant in the case of M/s Patil Automation

Private Limited & others (supra) is of no help to the petitioner.

Similarly, invocation of doctrine of necessity by the learned

counsel for the petitioner in the background of State

Government notification establishing the Commercial Courts in

the district of Khurda on 13.11.2020 and the decision of the

Supreme Court in the case of Dr. Subramaniam Swamy (supra)

cannot be accepted in the background of the facts as discussed

above particularly when provisions of ‘the Act’ are not at all

attracted to a lis of this nature. It is reiterated that in a case of

present nature, determination of specified value by the learned

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District Judge afresh in the absence of any averment to that

effect in the plaint and in the background of his earlier order

dated 19.07.2021 under Annexure-12 rejecting the prayer of the

opposite party/plaintiff to incorporate the specified value by way

of amendment and observation of the Commercial Court in its

order under Annexure-10 that since the suit has been valued at

Rs.1,00,000/- and the same can be taken as the specified value,

is clearly illegal and impermissible when both these two orders

remain unchallenged. Accordingly, the impugned order under

Annexure-1 is set aside. The learned District Judge is directed to

proceed with C.S. No.02 of 2021 in accordance with law.

7. The Civil Revision is accordingly disposed of. No cost.

…….….……………………
Biswajit Mohanty, J.

Orissa High Court, Cuttack

The 20th October, 2022 /Prasant

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