The Delhi High Court set aside the imposition of cost of Rs. 12 lakh on VI-John Healthcare for delay in filing the written statement and noted that the cost imposed was disproportionate to the main relief sought in the suit. The High Court also held that there is no absolute bar on the Trial Court to consider the subsequent developments and condone the delay if justifiable grounds are made out.

The Petition before the High Court was filed under Article 227 of the Constitution against the Order (Second Impugned Order) passed by the Trial Court allowing the application filed under Order VIII Rule 1 read with Section 151 of CPC and Section 5 of the Limitation Act, 1963 and condoning the delay in filing the Written Statement, subject to payment of cost of Rs 25,000 for each day’s delay by the Petitioner to the Respondent.

The Single Bench of Justice Tejas Karia held, “Although the First Impugned Order states that the same is final insofar as it relates to imposition of cost in case of any delay in filing the Written Statement, there is no absolute bar on the learned Trial Court to consider the subsequent developments and condone the delay if justifiable grounds are made out in the Application for condonation of delay.”



Advocate Neeraj Grover represented the Petitioner while Advocate Mohd. Sazid Rayeen represented the Respondent.

Factual Background

The dispute in the present case arose from a suit filed by the Respondent claiming infringement of Trade Mark, copyright, passing off and damages to the tune of Rs 2,50,000 against the Petitioner before the Trial Court with respect to its packaging. The Respondent claimed to be aggrieved by the use of packaging by the Petitioner and the descriptive use of the word “MISWAK” by the Petitioner on its packaging. The summons in the Suit was served upon the Petitioner. On the date of appearance, the Trial Court passed the First Impugned Order, directing that any delay in filing the Written Statement or Replication might be considered subject to a cost of ₹25,000 for each day of delay.

Thereafter, the second impugned order was passed imposing a cost upon the Petitioner. The Petitioner had relied upon the various orders passed by the High Court in similar IPR suits, wherein the damages sought were over Rs 2,00,00,000; however, the cost imposed for condonation of delay in filing of written statement was in the range of Rs 5,000 to Rs 10,000. It was the Petitioner’s case that despite making the above submissions, the Trial Court allowed the Application subject to a cost of Rs 25,000 for each day of 48 days’ delay, which amounted to Rs 12,00,000.

Reasoning

The Bench noted that the Second Impugned Order had been passed without considering the averments made in the Application and only relying on the First Impugned Order. “At the time of passing of the First Impugned Order, there was no delay and the said Order only cautioned the Parties that, in case of delay, a cost of ₹25,000/- per day will be imposed. The said Order was precautionary and deterrent in the nature and not a penalty imposed upon the Parties. As on the date of passing the First Impugned Order, there was no occasion to consider any delay by the Parties as the time to file the Written Statement had commenced only on the date of passing of the First Impugned Order”, it said.

It was further held that when the Respondent had not even filed a Reply to the Application and had not raised any objection thereto, the Trial Court ought to have considered the fact that the Parties were exploring the possibility of settlement, which was also recorded in the previous Order passed by the Trial Court.

It was noted that the Trial Court also lost sight of the implications of passing of the Second Impugned Order, which resulted in imposition of the cost amounting to Rs 12,00,000 upon the Petitioner, whereas the Respondent’s main relief in the Suit was payment of Rs 2,50,000 by way of damages. “Clearly, the cost imposed by the learned Trial Court in the Second Impugned Order was disproportionate to the main relief sought in the Suit”, it said.

The Bench stated that as the delay in filing of the Written Statement was only 48 days and well within the outer limit of 120 days as prescribed, it could not be said that there was an inordinate delay on the part of the Petitioner without any justifiable reason. “The reason for delay as mentioned in the Application and submitted before the learned Trial Court at the time of passing of the Second Impugned Order, was justified. However, the same was entirely ignored by the learned Trial Court while passing the Second Impugned Order.In view of the above, the First Impugned Order and the Second Impugned Order, insofar as they relate to the imposition of cost for delay in filing of the Written Statement are set-aside”, it held.

Allowing the Petition, the Bench condoned the delay in filing the Written Statement to the Suit without imposing payment of any cost by the Petitioner to the Respondent.

Cause Title: VI-John Healthcare India LLP v. Dabur India Limited (Neutral Citation: 2025:DHC:6269)

Appearance

Petitioner: Advocates Neeraj Grover, Harshita Chawla, Angad Deep Singh, Mohona Sarka

Respondent: Advocates Mohd. Sazid Rayeen, Avijit Sharma

Click here to read/download Order


Delhi High CourtJustice Tejas Karia

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.