Supreme Court: Ongoing IP Infringement Exempt from Mandatory Mediation under Section 12A of the Commercial Act.

Case Title:- Novenco Building and Industry A/S vs. Xero Energy Engineering Solutions Pvt. Ltd. & Anr.

Citation:- 2025 INSC 1256

Date:- 27.10.2025

Hon’ble Supreme Court Bench:- JUSTICE SANJAY KUMAR & JUSTICE ALOK ARADHE

The Hon’ble Supreme Court held that a Commercial Suit alleging continuing infringement of intellectual property rights and seeking an interim injunction “contemplates any urgent interim relief” within the meaning of Section 12A of the Commercial Courts Act, thereby exempting it from pre-institution mediation.

In this case, Novenco, a Danish manufacturer of patented industrial fans branded “Novenco ZerAx,” had appointed Xero Energy as its Indian distributor. Xero’s Director allegedly incorporated Aeronaut Fans Industry Pvt. Ltd., producing and selling identical fans under a deceptively similar name. After discovering this in 2022, Novenco terminated its dealership, issued cease-and-desist notices, and, in June 2024, filed a commercial suit seeking injunction against the respondents for infringement.
The Hon’ble Himachal Pradesh High Court rejected the plaint under Order VII Rule 11 CPC, citing non-compliance with Section 12A, holding that there was a six-month delay between inspection (December 2023) and filing (June 2024), and Seeking interim relief alone doesn’t automatically prove urgency. The Hon’ble Division Bench of Himachal Pradesh High Court upheld this decision.
The Appellant contends that the infringement was continuous, and every sale of the infringed items was a fresh cause of action. Further, Section 12A aims to encourage mediation but not to deprive IP owners of protection during ongoing harm. The plaint and annexed documents clearly showed immediate, irreparable harm to Novenco’s goodwill and reputation.
The Hon’ble Court after reviewing the settled law and arguments of the parties distilled the legal test for rejection of the plaint and for adjudication of interim relief, as follows:
- “(i) Section 12A mandatorily requires pre-institution mediation for commercial suits, non-compliance of which would ordinarily render the plaint institutionally defective.
- (ii) A plaintiff can be exempted from the requirement of Section 12A only when the plaint and the documents attached with it clearly show a real need for urgent interim intervention. A wholesome reading of the plaint and the material annexed to the plaint ought to disclose the need for urgent relief.
- (iii) The court must look at the plaint, pleadings and supporting documents to decide whether urgent interim relief is genuinely contemplated. The court may also look for immediacy of the peril, irreparable harm, risk of losing rights/assets, statutory timelines, perishable subject-matter, or where delay would render eventual relief ineffective.
- (iv) A proforma or anticipatory prayer for urgent relief used as a device to skip mediation will be ignored and the court can require the parties to comply with Section 12A of the Act.
- (v) The court is not concerned with the merits of the urgent relief, but if the relief sought seems to be plausibly urgent from the standpoint of the plaintiff the court can dispense with the requirement under Section 12A of the Act.”
Finally, The Hon’ble Supreme Court set aside the Hon’ble High Court’s orders, restored Novenco’s suit, and held that In cases of continuing IP infringement, pre-institution mediation is not mandatory, Delay in filing does not eliminate urgency when the violation persists.