Delhi High Court Affirms Wide Transfer Powers Under Section 24 CPC In IP Matters, Overrides Narrow Reading Of IPD Rules

Summary

The Delhi High Court in C.O.(COMM.IPD-CR) 5/2024 and TR.P.(C.) 146/2024 decided on 4 December 2025 addressed the transfer and consolidation of intellectual property proceedings involving the same subject matter pending before different courts under Section 24 CPC. Justice Tejas Karia allowed the transfer petition filed by Surinder Kumar, directing that the suit and counterclaim pending before the Additional District Judge-03, Patiala House Courts be transferred to the Intellectual Property Rights Division of the Delhi High Court and consolidated with the rectification petition already pending before it. The judgment clarified that the power under Section 24 of the Code of Civil Procedure, 1908 to transfer matters is not circumscribed by Rule 26 of the Intellectual Property Rights Division Rules, 2022, and extends to non-commercial matters involving intellectual property rights.​

Facts

The petitioner, Surinder Kumar, filed a transfer petition under Section 24 of the CPC read with Rule 26 of the IPD Rules seeking transfer of a suit (TM No. 13765/16) and counterclaim (No. 19 of 2022) pending before the District Court to the Delhi High Court. The respondent, Rahul Khanna, had filed the suit in 2016 for passing off, infringement of copyright, delivery up of goods, and rendition of accounts, seeking to restrain the petitioner from using the trademark ‘PRAKASH’ for PVC Self-Adhesive Electrical Insulation Tape. The petitioner filed a counterclaim seeking permanent injunction against the respondent for passing off goods under an identical trademark and label, and for allegedly violating copyright in the artistic work.

Simultaneously, the petitioner filed a rectification petition (C.O. COMM.IPD-CR 5/2024) before the IPD of the Delhi High Court seeking expungement of copyright registration No. A-115513/2016 in favour of the respondent. The petitioner had originally filed the rectification petition in 2016 before the Copyright Board, which was later abolished and matters shifted to the Intellectual Property Appellate Board, and subsequently to the High Court after IPAB’s abolition. The suit before the District Court was at the final hearing stage, with evidence concluded in March 2021 and final arguments scheduled for 17 December 2025.​

Issues

The principal issues before the court were

• Whether the Delhi High Court possessed the power under Section 24 of the CPC read with Rule 26 of the IPD Rules to transfer a non-commercial suit pending before the District Court to the IPD of the High Court, and
• Whether such transfer was appropriate considering the advanced stage of proceedings before the District Court and the timing of the transfer petition.

The respondent contended that Rule 26 of the IPD Rules only contemplated transfer of matters pending before Commercial Courts, and that the suit valued below Rs. 3 lakhs pending before a non-commercial court could not be transferred under this provision. Additionally, the court had to determine whether the stage of proceedings and the petitioner’s delay in approaching the court precluded the exercise of transfer jurisdiction.​

Arguments

The petitioner argued that the suit pending since 2016 was listed for final arguments on 17 December 2025, and that there was commonality of issues between the suit, counterclaim, and rectification petition. The completed evidence in the suit was also relied upon in the rectification petition, and if any proceeding was decided first, it would have a bearing on the others, necessitating consolidation.

The petitioner relied on Rule 26 of the IPD Rules, which provides for consolidation of multiple proceedings relating to the same or related IPR subject matter, and cited Patola Industries v. Mahesh Namkeen Pvt. Ltd where a suit from the District Court was transferred to the High Court. The petitioner contended that Section 24 of the CPC confers general power of transfer on the High Court, and as the suit concerned IPR, the court was empowered to transfer it. Reference was also made to M/s Loreal India Private Limited v. M/s Pornsricharoenpun Co. Ltd where proceedings before IPAB were transferred considering overlapping issues. The petitioner highlighted that the respondent had taken inconsistent stands, seeking adjournment of the suit on grounds that the rectification petition was pending, while seeking stay of the rectification petition on grounds that the suit was pending.​

The respondent opposed the transfer, arguing that Rule 26 of the IPD Rules provides for consolidation only of matters pending before Commercial Courts, and the suit valued below Rs. 3 lakhs before a non-commercial court could not be transferred under this provision. The respondent submitted that powers conferred by Section 24 of the CPC are circumscribed by Rule 26 of the IPD Rules, and any transfer must be considered by reading both provisions together.

Relying on Fox & Mandal v. Somabrata Mandal, the respondent argued that the stage of proceedings is of paramount importance while exercising transfer and consolidation powers. The respondent emphasized that the suit had progressed significantly before the District Court, with evidence closed in 2018, Local Commissioner evidence concluded in 2021, and final arguments commenced. The respondent cited Sonani Industries Pvt. Ltd. v. Mr. Sanjay Jayantbhai Patel where the court stayed rectification proceedings awaiting the suit decision rather than consolidating them. The respondent contended that the reliance on Patola Industries was misplaced as parties therein had agreed to transfer.​

Decision

The Delhi High Court allowed the transfer petition and directed that the suit bearing TM No. 13765/16 and counterclaim No. 19 of 2022 pending before the District Court be transferred to the Delhi High Court and consolidated with the rectification petition bearing C.O. (COMM.IPD-CR) 5/2024. The court held that it possessed power under Section 24 of the CPC to transfer matters involving IPR subject matter irrespective of whether they were categorised as commercial or non-commercial, without reference to Rule 26 of IPD Rules. The court directed the Registry to renumber the suit and counterclaim and list them along with the rectification petition. The matter was listed for 16 March 2026 for consolidated hearing.​

Analysis

The judgment establishes significant jurisprudence on the interplay between Section 24 of the CPC and Rule 26 of the IPD Rules. The court adopted a harmonious interpretation, holding that Rule 26 contemplates two situations: consolidation of matters pending before the High Court, and transfer of matters from Commercial Courts under Section 24 of the CPC followed by consolidation. However, the court clarified that Rule 26 does not curtail the general power of transfer available under Section 24 of the CPC, which operates independently. The reference to Section 24 in Rule 26 merely provides clarity regarding the provision otherwise available for transfer and does not limit the powers in any manner.​

The court reasoned that Rule 26 does not contemplate transfer of non-commercial matters on the assumption that all IPR matters would be before Commercial Courts, but Section 24 makes no such distinction and permits transfer at any stage, even suo motu. The power to transfer under Section 24 is very wide, and mere reference in Rule 26 does not take away its generality. The court emphasized that both Section 24 and Rule 26 share the same aim of avoiding multiplicity of proceedings and conflicting decisions involving the same subject matter. In IPR matters, where parties have multiple legal remedies before various forums, it is expedient to ensure that rights flowing from the same or related IPR subject matters are decided at once by a single court.​

On the issue of timing and stage of proceedings, the court noted that the suit and counterclaim were at final hearing stage, but the evidence stage was concluded in March 2021 and final hearing did not commence for nearly three years. The court found that no real or tangible prejudice in terms of cost, delay, or otherwise had been shown to outweigh the larger interest in favour of transfer and consolidation.

The transfer would not entail reopening of evidence already concluded or undo any procedural stage, as the evidence led before the District Court was being referred in the rectification petition. The court distinguished Fox & Mandal on facts and held that allegations of delay cannot outweigh the necessity to avoid conflicting decisions on the same subject matter. The court also distinguished Sonani Industries where the Supreme Court had directed the District Court to decide the suit within one year, making those facts different. The court observed that decisions involving different facts and circumstances are not binding in cases of transfer, as it is the discretion of the court whether to transfer proceedings considering overall facts, submissions, and stages of proceedings.