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K. Mangayarkarasi v. N.J. Sundaresan

Special Leave Petition (Civil) · 2025 INSC 687Decided 9 May 2025
SLP(C) No.-013012 - 2025
Justice J.B. Pardiwala · Justice R. Mahadevan

Background

This was a family dispute over the "Sri Angannan Biriyani Hotel" trademark, in which the petitioners (family members holding the trademark) sued for a permanent injunction and damages against another family member for allegedly infringing the mark. The defendant applied under Section 8 of the Arbitration Act to have the dispute referred to arbitration based on an arbitration clause in trademark assignment deeds, and both the Commercial Court and the Madras High Court agreed, referring the parties to arbitration.

Decision Breakdown

The Supreme Court upheld the reference to arbitration, holding that a dispute over rights arising from a private contract (the assignment deed) - as opposed to a dispute over the grant or registration of a trademark itself, which is a sovereign government function - is arbitrable. The petitioners' allegation that they were fraudulently made to sign the assignment deed did not bar arbitration, because mere allegations of fraud between private parties without any broader public implication do not oust the arbitral tribunal's jurisdiction; the tribunal itself has the power under Section 16 of the Act to decide on the validity of the agreement. The Special Leave Petition was dismissed.

Lesson Learnt

If a dispute over a trademark actually stems from a private contract (such as an assignment agreement) containing an arbitration clause, courts will send the parties to arbitration even where one side alleges the contract was obtained by fraud - unless that fraud has implications beyond the parties themselves.

Official source (sci.gov.in)View Judgment (PDF)

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