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Informist, Wednesday, Dec. 17, 2025

 

NEW DELHI – The division bench of the Delhi High Court Wednesday issued a notice to Adyar Gate Hotels Ltd. on ITC Ltd. and its associate company ITC Hotels Ltd.'s appeal against a single judge's Dec. 4 order refusing to restrain the former from using or dealing in the restaurant and food business under the name 'Dakshin'. However, Adyar Gate Hotels will remain bound by its undertaking before a single judge bench that it will not expand the operation of its 'Dakshin' restaurant beyond Chennai till the final adjudication of the suit filed by ITC and ITC Hotels. The court will hear the case next on Feb. 17.

 

On Dec. 4, a single judge bench of Justice Amit Bansal had rejected pleas by ITC and ITC Hotels to restrain Adyar Gate Hotels Ltd. from using  the name 'Dakshin' till a permanent injunction suit filed by the petitioners is decided. Justice Bansal had said that ITC and ITC Hotels' suit was barred by jurisdiction. "Even though the plaintiffs have an office in Delhi, in view of my prima facie finding that no cause of action has arisen within the jurisdiction of this Court, this court would not have jurisdiction only on the basis of the plaintiffs having an office in Delhi. In my prima facie view, the cause of action in the present case has arisen in Chennai, where as per the averments made in the plaint itself, the plaintiff has subordinate office," said Justice Bansal.

 

Justice Bansal said that he would be inclined to dismiss the petition in view of a prima facie finding of lack of territorial jurisdiction, however, since counsel for the parties had extensively argued on the merits of the matter, he deemed it appropriate to give his findings on merits as well. "Taking into account the fact that defendant has been continuously running its restaurant under the name 'Dakshin' from 1989 onwards, from 1989-2015 in association with the plaintiffs and thereafter independently, the scales of balance of convenience would weigh in favour of the defendant, disentitling the plaintiffs to an interim injunction," said Justice Bansal. 

 

In October 2024, the hotels and hospitality business of ITC was demerged through a scheme of arrangement and transferred to ITC Hotels. Pursuant to the merger, ITC Ltd. granted an exclusive licence to ITC Hotels to use several of its well-known trademarks, including the 'Dakshin' mark, for the operation of premium restaurants. 

 

ITC Ltd. had said that it held various trademark registrations in respect of the mark 'Dakshin'. The earliest registration granted to ITC Ltd. was dated Dec. 13, 2000, with use claimed from Apr. 1, 1989. ITC Ltd. had said that the highly stylised and unique mark 'Dakshin' was adopted by it for use in the restaurant on the premises of Welcomgroup Park Sheraton Hotel, Chennai, in 1989. Since the launch of that restaurant in 1989, ITC Ltd. has garnered immense goodwill and reputation with respect to this restaurant, the petitioners said. 

 

In view of the success of the first restaurant, ITC Ltd. subsequently launched branches of the restaurant in various other hotels run by it across India. It is one of the conglomerate's most awarded restaurants, said ITC Ltd. It was operating 'Dakshin' in Mumbai, Hyderabad, Delhi, Visakhapatnam and Bengaluru, and the revenue generated by these under the mark for 2023-24 (Apr-Mar) was to the tune of INR 123.8 million, ITC Ltd. said.

 

It said it had entered into an operating services agreement with Adyar Gate Hotels in 1985 and a hotel under the name 'Welcomgroup Park Sheraton' was launched the same year, under the terms of the agreement. As per the agreement, the present as well as future trademarks, trade names, service marks and other intellectual property were to belong to ITC and Adyar Gate was only conferred limited right to use the same. The agreement also provided that Adyar Gate would have no right to use the trademarks after the expiry of the agreement.

 

In 2015, the agreement expired. Thereafter, the petitioners withdrew from the hotel and the hotel was transferred to a third party and renamed 'Crowne Plaza, Chennai, Adyar Park'. ITC Ltd. said that even though Adyar Gate did not have any right to use the 'Dakshin' name after the expiry of the terms of the agreement, the petitioner, on account of its long relationship with the defendant, did not object to the restaurant under the given name, which continued to operate even though the plaintiffs had withdrawn from the hotel after 2015. The restaurant under the name 'Dakshin' continued to operate till Dec. 31, 2023, when the hotel shut down.

 

ITC Ltd. said that in October, 2024, the petitioners were shocked to learn about Adyar Gate opening a standalone restaurant at a new location using an identical mark 'Dakshin'. Further, the defendant was using the mark in an identical style and get-up as used by the plaintiffs, and serving similar cuisine as the plaintiff's restaurants, ITC Ltd. and ITC Hotels said.

 

At 1457 IST, shares of ITC traded 0.5% lower at INR 399.90 on the National Stock Exchange and those of ITC Hotels traded 0.5% higher at INR 191.51.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Akul Nishant Akhoury

 

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