Delhi HC Holds Name Change Doesn't Nullify Arbitration Clause, Refers Newgen Dispute To Arbitration

On 1 July, the Delhi High Court referred a trademark infringement dispute between Newgen Software Technologies Ltd and Newgen IT Technologies Ltd, formerly known as Vcare Infotech Solutions and Services Pvt Ltd, to arbitration.

A Division Bench of Justices C. Hari Shankar and Om Prakash Shukla set aside a Commercial Court order that had refused to refer the parties to arbitration, holding that a mere change in corporate name does not extinguish an arbitration clause in a subsisting agreement. The judges held:

“The mere change in the corporate name of one of the parties does not bring the contract between them to an end... if this were so, a party to a contract could, by merely changing its corporate name, stand excused of its liabilities under the contract.”

The dispute arose from a Partner Agreement executed on 12 July 2023 between Newgen Software and Vcare Infotech. Under this agreement, Vcare was authorised to use the NEWGEN trademarks for distributing Newgen Software's products, subject to conditions laid down in Article 14. Article 18 of the agreement provided for dispute resolution through arbitration.

On 10 July 2024, Vcare changed its name to Newgen IT Technologies Ltd. Newgen Software stated that it learnt of the name change only through an email invitation to a company event. It then terminated the Partner Agreement on 15 September 2024, alleging illegal misappropriation of its trademarks, and directed the appellant to stop using the NEWGEN marks.

When the appellant refused to comply, Newgen Software filed a commercial suit seeking a permanent injunction for trademark infringement and passing off, along with damages of Rs 3,01,000. Upon receiving summons, Newgen IT filed an application under Section 8 of the Arbitration and Conciliation Act, 1996, seeking reference of the dispute to arbitration under Article 18 of the Partner Agreement.

The Commercial Court dismissed the application on 23 April 2025, holding that the agreement had ended “by its natural death” after the change in corporate name and that the arbitration clause had lost its “significance and validity.”

However, the High Court held that the Commercial Court's reasoning on the name change was “ex facie unsustainable in law and on facts.” It observed that a change in name does not bring the contract to an end.

While addressing arbitrability, the Bench relied on the Supreme Court's decision in K. Mangayarkarasi v N.J. Sundaresan (2025), which also dealt with a Section 8 application in a trademark dispute arising from a related agreement.

It held that questions of arbitrability constitute jurisdictional issues and, under the negative aspect of the kompetenz-kompetenz doctrine, the Arbitral Tribunal must decide them in the first instance. The judges noted:

“Whether, despite this, the dispute between the parties would be nonetheless non-arbitrable, to our mind, is an aspect which, given the law in that regard and the scope of Section 16 of the 1996 Act, ought to be left for decision, in the first instance at least, by the Arbitral Tribunal.”

The Court also noted that the trademark infringement claim in the suit was “specifically pleaded to be a direct breach of Article 14 of the Partner Agreement”, which created a “live and palpable” connection between the dispute and the arbitration clause.

Accordingly, the High Court quashed the Commercial Court's order, allowed the Section 8 application, and referred the dispute to arbitration under Article 18 of the Partner Agreement. It left the parties free to initiate arbitration in accordance with law and allowed the appeal without costs.