Case at a Glance
In the trademark suit filed by the owner of the famous “KARIM’S” restaurant marks against a Moradabad restaurant called “GULSHAN-E-KARIM”, the Commercial Court allowed the defendant to file 25 additional documents (tax, licensing, labour, purchase and bank records) years after his written statement, on payment of Rs 20,000 costs. The Delhi High Court set that order aside under Article 227. It held that records of one’s own business kept in one’s own premises remain in one’s custody, and that the defendant had not established “reasonable cause” for not filing them earlier, as Order XI Rule 1(10) CPC requires.
Karim Hotels Pvt. Ltd. runs restaurants and claims registered trademarks “KARIM”, “KARIM’S” and “KAREEM”, in use through its predecessors since 1913. The respondent runs a restaurant in Moradabad under the name “GULSHAN-E-KARIM”, which he says his father coined and adopted in 1997. Karim Hotels sued on 16 August 2022, and the written statement was filed on 20 October 2022. On 15 January 2025 the Commercial Court restrained the respondent from using the mark; a Division Bench, by judgment dated 6 November 2025 in FAO (COMM) 82/2025, affirmed the prima facie finding of infringement but allowed continued use with a conspicuous disclaimer.
The respondent then applied under Order XI Rule 1(10) and (12) CPC to place 25 additional documents on record, mostly tax, licensing, labour, purchase and bank records, saying they had surfaced during renovation or repair work. Karim Hotels objected that the documents had been in the respondent’s own premises all along, that some were obtained two days before the written statement, and that the application came only after it had closed its evidence. On 9 December 2025 the Commercial Court allowed the application subject to Rs 20,000 costs. Karim Hotels challenged that order under Article 227.
The Key Question Before the Court
Can a Commercial Court allow a defendant to file additional documents under Order XI Rule 1(10) CPC on relevance alone, when the documents were his own business records lying in his own premises and no reasonable cause for the earlier non-disclosure was established?
Sub-Rule (10) Is Not an Open-Ended Discretion
On maintainability, Justice Purushaindra Kumar Kaurav held that Article 227 jurisdiction over interlocutory orders of Commercial Courts is not barred, though it is to be used very sparingly, relying on cases such as Garment Craft v. Prakash Chand Goel, (2022) 01 SC CK 0028, (2022) 4 SCC 181, Estralla Rubber v. Dass Estate (P) Ltd., (2001) 8 SCC 97, and Shalini Shyam Shetty v. Rajendra Shankar Patil, (2010) 07 SC CK 0089, (2010) 8 SCC 329. On the merits, the Court found that the Commercial Court had not first asked whether the documents were in the defendant’s power, possession, control or custody when he filed his written statement. It held that they were: “Records of one’s own business, kept in one’s own premises, remain in one’s custody.”
The Court stressed that the burden lies on the party seeking leave: “The statute requires the defendant to ‘establish’ reasonable cause.” A vague story of documents turning up during renovation did not meet that standard, and an order based only on relevance departed from the strict disclosure regime of the Commercial Courts Act, 2015. Drawing on Sudhir Kumar @ S. Baliyan v. Vinay Kumar G.B., (2021) 13 SCC 71, Nitin Gupta v. Texmaco Infrastructure & Holding Ltd., (2019) 04 DEL CK 0230, 2019 SCC OnLine Del 8367, and Levitate Mobile Technologies Pvt. Ltd. v. Standard Chartered Bank, 2025 SCC OnLine Del 818, the Court held that “Sub-rule (10) does not confer an open-ended discretion on the Commercial Court”, and that the impugned order was a flagrant violation of the statutory mandate warranting interference.
What the Court Actually Held
- A petition under Article 227 against an interlocutory order of a Commercial Court is maintainable, but interference is reserved for rare cases such as a flagrant breach of the statute.
- Documents that are a party’s own business records, kept in its own premises, are in its power, possession, control or custody; they cannot later be treated as newly discovered.
- The party seeking to file documents late must itself establish reasonable cause; relevance alone is not enough.
- The order dated 9 December 2025 was set aside and the respondent’s application under Order XI Rule 1(10) and (12) CPC was dismissed, without any opinion on his plea of use of “GULSHAN-E-KARIM” since 1997.
Why This Judgment Matters
- It reinforces the strict document-disclosure discipline in commercial and IP suits under the Commercial Courts Act.
- It closes the common “found during renovation” route for bringing in a party’s own records after the other side has led evidence.
- It shows that Article 227 remains available against Commercial Court orders that flatly ignore the statutory test.
What Should Advocates Take Away From the Judgment?
For Business Owners in IP Disputes
- Collect and file all your own records (tax, licences, invoices, bank statements) with the pleading itself.
- Do not rely on being allowed to add your own business papers later; courts treat them as always within your custody.
For Counsel
- When resisting late documents, show that they were the party’s own records and press the absence of an established reasonable cause.
- When seeking leave, file a specific affidavit on when, where and how the documents were traced; bare assertions fail.
- Cite the distinction between relevance and reasonable cause; a trial court order on relevance alone is open to challenge.
Key Takeaways
- Order XI Rule 1(10) CPC requires the party to establish reasonable cause for non-disclosure.
- One’s own business records kept in one’s own premises are in one’s custody.
- Relevance of a document is not a substitute for the statutory test.
- Article 227 can correct a flagrant violation of the commercial disclosure regime.
Frequently Asked Questions
What was the dispute about?
Karim Hotels, which owns the “KARIM’S” marks, sued a Moradabad restaurant using “GULSHAN-E-KARIM” for trademark infringement. This ruling dealt only with whether the defendant could file 25 additional documents late.
Why were the documents rejected?
They were the defendant’s own business records kept in his premises, so they were in his custody when he filed his written statement, and he did not establish reasonable cause for not filing them then.
Has the court decided who owns the mark?
No. The Court expressly said its ruling is not an opinion on the merits, including the defendant’s plea that he has used “GULSHAN-E-KARIM” since 1997; that will be decided at trial.
Conclusion
The judgment is a reminder that commercial suits are run on strict disclosure. A defendant who keeps his own tax, licence and bank records in his own premises cannot hold them back and then introduce them years later with a general explanation. The trademark dispute between Karim’s and Gulshan-e-Karim now continues to trial without those documents.
Practical takeaway: In any commercial or IP suit, file all your own records with the pleading; a late application must establish reasonable cause, not just relevance.
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