On November 3, 2026, the High Court of Delhi delivered a comprehensive judgment addressing the complexities of territorial jurisdiction in intellectual property disputes. The lead matter, CS(COMM) 987/2026, alongside a batch of connected commercial suits, required the Court to clarify where plaintiffs can rightfully institute legal proceedings in the modern digital era.
One of the primary issues was the interpretation of the phrase “carries on business” under Section 20 of the Code of Civil Procedure and the specialized provisions of the Trade Marks Act and Copyright Act. The Court passed the order rejecting the notion that a corporation carries on business everywhere its website is accessible or where its goods are merely sold. Instead, the Court established that a corporation is deemed to carry on business at its sole or principal office, which is ordinarily its registered office. If a company has a subordinate office, it can only be sued there if the cause of action also arose in that specific location.
The judgment heavily scrutinized how a cause of action arises in the online world. For online trademark infringement and passing off, the Court held that mere accessibility of a website does not confer jurisdiction. A plaintiff must demonstrate that the defendant specifically targeted consumers within the local limits of the forum court and that actual commercial transactions were concluded through the website.
Furthermore, the Court clarified the standards for quia timet actions, which are suits based on apprehended infringement. The Court stated that simply filing a trademark application does not give rise to a cause of action for a quia timet suit. A plaintiff must prove an imminent danger of substantial injury and a deliberate intention by the defendant to engage in infringing activity.
The Court also dismissed the argument relying on the “dynamic effect” of infringement. Plaintiffs frequently argued that the economic or dynamic effect of an infringement is felt at their principal place of business, thereby granting that local court jurisdiction. The Court rejected this theory, stating that such an interpretation would render the specialized jurisdictional amendments in the Trade Marks Act and Copyright Act completely otiose.
The practice of a plaintiff hiring an investigator to place trap orders from a specific location to claim that a commercial transaction occurred there was deemed an abuse of the legal process. Unless the defendant was already supplying goods to that area in the natural course of trade, such orchestrated trap transactions cannot be used to establish territorial jurisdiction.
To prevent widespread forum shopping, the Court formally applied the doctrine of forum non conveniens to civil suits. The Court observed that even if a small fraction of the cause of action arises in a particular location, the judicial forum can still refuse to exercise its inherent jurisdiction if another court is clearly more appropriate and convenient for the parties. This ensures that plaintiffs cannot drag defendants to distant courts based on trivial connections to the chosen venue.
Ultimately, the Court passed the order to ensure that jurisdictional rules retain their meaning in the age of borderless online commerce. By demanding a high threshold for specific targeting and invoking equitable doctrines, the judgment restores balance to intellectual property litigation.
Read the Judgement here.