Supreme Court Stays Swiss Company's Patent Suit Against Techfab Before Himachal Pradesh High Court

The Supreme Court on Tuesday, 1 September stayed further proceedings before the Himachal Pradesh High Court in a patent infringement suit filed by Swiss company Geobrugg AG against Techfab (India) Industries Ltd. over the manufacture and sale of high-tensile wire mesh products sold under the “TECCO” brand.

A Bench of Justices K.V. Viswanathan and Arun Palli issued notice returnable on 2 November and directed the parties to complete their pleadings in the meantime. During the hearing, the judges questioned “what happened to the injunction application in the suit?”.

Counsel appearing for Techfab, argued that the company was based in Mumbai and manufactured its products in Uttarakhand, with no business, agent or distributor in Himachal Pradesh. He submitted that the suit was principally based on a single invoice concerning goods transported to Kullu.

Pointing to the invoice, he submitted that Techfab, whose address was in Mumbai, was the seller, while the consignee was a Maharashtra-based company. The goods, he said, were handed over to a transporter in Uttarakhand, who was acting as the purchaser's agent. He stated:

“I am a manufacturer, seller. The buyer is a company which is not even the company which is filed is based. They are based in Maharashtra.”

He further pointed out that the invoice recorded the vehicle of a Haryana-based transporter and stated that the goods were delivered to the transporter in Uttarakhand, although Kullu was the ultimate delivery location. He also relied on the terms of the invoice, including the condition that quality-related issues concerning the product had to be raised within seven days of receipt of the material.

On the website-based cause of action, he argued that the listing relied upon by Geobrugg was on IndiaMART, a third-party business-to-business platform, and did not establish that Techfab was carrying on business in Himachal Pradesh.

“The plaintiff is just his company. Has no business in India at all. I am a person carrying on business in Maharashtra and presumably Uttarakhand. I do not have any agents in this place,” he said.

He also referred to Section 20 of the Code of Civil Procedure, which sets out when a suit can be filed based on the defendant's place of residence or business or where the cause of action arises. He submitted that there was no territorial connection sufficient to confer jurisdiction on the Himachal Pradesh High Court.

Further, he told the Bench that the products in question were safety-related products used to prevent rocks from falling on roads and people in mountainous areas, stating:

“One of my products in question are very, very important products, which are for the safety of all the brands going up and down the mountains.”

Lastly, he submitted that the products were sold across several States and that continuation of the proceedings in Himachal Pradesh could have wider commercial consequences.

Background

Geobrugg AG had filed the patent infringement suit against Techfab, alleging unauthorised manufacture and sale of high-tensile wire mesh products covered by its Indian patents and sold under the “TECCO” brand.

Techfab had sought dismissal of the suit, arguing that the Himachal Pradesh High Court lacked territorial jurisdiction. It also argued that Urbtech Engineering Construction Private Limited, which purchased the product, was a necessary party and that Geobrugg had not undergone pre-institution mediation.

The High Court rejected these objections. It held that Urbtech was not a necessary party and that Geobrugg's claim for urgent interim relief exempted it from mandatory pre-institution mediation.

It further held that the sale was completed in Himachal Pradesh since the buyer had an opportunity to inspect the goods there, thereby conferring territorial jurisdiction on the Court.

Techfab challenged the High Court's decision before the Supreme Court.