The case of Principal Commissioner of Customs & Anr. v. L'Oréal S.A. came before the Delhi High Court under Article 227 of the Constitution of India, raising significant questions concerning jurisdictional overreach, the concept of a court becoming functus officio, and the limits of post-decree judicial proceedings. The matter pertained to intellectual property enforcement at the border and a broader conflict between administrative procedure and judicial process in post-decree scenarios.

Factual Background: L'Oréal S.A., a multinational cosmetic brand, filed a commercial suit for permanent injunction against M/s Oneness Enterprises (defendant no.1), as well as customs authorities—namely the Principal Commissioner of Customs (defendant no.2) and Commissioner of Customs (RI&I) (defendant no.3).

The core of the suit revolved around the alleged import of counterfeit goods bearing the plaintiff's registered trademarks "L'OREAL" and "MAYBELLINE" under Bill of Entry No. 9605576 dated 08.05.2017.L'Oréal sought extensive reliefs, including a decree for permanent injunction, confiscation and destruction of the impugned goods, rendition of accounts, disclosure of the entire chain of importation, and a restraint on asset disposal by the importer to secure any potential monetary relief.

Procedural Background:

• The trial was conducted before the District Judge (Commercial Court)-02, Patiala House Courts, New Delhi.
• The suit—CS(COMM) 128/2023—culminated in a judgment dated 19.10.2024, whereby a decree was passed in favour of L'Oréal.
• The decree directed that the suit was decreed with costs against the defendants.
• On the same date, the Trial Court passed a separate order whereby it continued post-decree proceedings:
  • Called for comments from customs counsel,
  • Issued show cause notices,
  • Directed filing of an Action Taken Report (ATR).
• This led to a new case being registered—MISC DJ/3623/2024.
• Further orders were passed in the new case on 24.10.2024, 11.11.2024, and finally on 17.01.2025—the latter being challenged in the present petition under Article 227.

Issues Involved in the Case:

• Whether the Trial Court, after passing a final judgment and decree, retained jurisdiction to:
  • Continue post-decree proceedings,
  • Open a new file (MISC DJ/3623/2024),
  • Issue show cause notices,
  • Call for ATRs, despite no execution proceedings having been filed.
• Whether a Court, once functus officio, could suo motu assume jurisdiction for procedural compliance outside the statutory framework.

Submissions of Parties:

• Petitioners contended that:
  • After the decree on 19.10.2024 and consigning of the file, the Trial Court became functus officio.
  • No new file could be opened nor orders passed without an execution petition.
  • The initiation of MISC DJ/3623/2024 amounted to judicial overreach.
• Jurisdiction cannot be assumed by consent, waiver, or acquiescence.
• Cited judgments:
  1. Harshad Chiman Lal Modi v. DLF Universal Ltd., (2005) 7 SCC 791: A Court without subject-matter jurisdiction cannot assume it through consent; such orders are nullities.
  2. Dr. Jagmittar Sain Bhagat v. Director, Health Services, (2013) 10 SCC 136: Jurisdiction must be conferred by statute and cannot be assumed by the court itself.

Judgment and Authorities Cited – Contextual Discussion:

• Harshad Chiman Lal Modi: Differentiated subject-matter jurisdiction from territorial/pecuniary jurisdiction; held judgments without subject-matter jurisdiction are null.
• Dr. Jagmittar Sain Bhagat: Reaffirmed that jurisdiction must stem from legislation, not judicial assumption.
• Collectively, these judgments clarified that reopening proceedings without a proper petition was impermissible.

Judicial Reasoning and Analysis:

• The Delhi High Court scrutinized procedural irregularities in the Trial Court's conduct post-decree.
• Held that the Trial Court, having closed the suit, could not suo motu create and act upon MISC DJ/3623/2024.
• No statutory basis existed for the Trial Court's actions absent a fresh proceeding.
• Participation of customs authorities post-decree could not validate void proceedings.
• Justice Banerjee condemned the Trial Court's conduct as:
  • "Patent perversity",
  • "Apparent error on the face of the record."
• The High Court exercised its supervisory jurisdiction under Article 227 to restore legal compliance and prevent miscarriage of justice.

Final Decision:
The Delhi High Court set aside the impugned order dated 17.01.2025 passed by the Trial Court in MISC DJ/3623/2024. Consequently, the entire proceedings initiated under that file, including all intermediate orders passed on 24.10.2024 and 11.11.2024, were also quashed. The High Court reaffirmed the principle that once a court becomes functus officio post-decree, it cannot continue to exercise jurisdiction unless statutorily enabled.

Law Settled in this Case:
The judgment settles the law on two key points:First, once a civil court passes a final judgment and decree, it becomes functus officio and lacks the authority to entertain or continue any further proceedings in the same matter except through statutorily recognized post-decree mechanisms like execution petitions.

Second, jurisdiction cannot be assumed or conferred by consent or participation. Any order passed by a court lacking jurisdiction over the subject matter, particularly after final adjudication, is null and void.This judgment reinforces judicial discipline and statutory fidelity, acting as a caution against judicial overreach and unwarranted continuation of proceedings outside the bounds of jurisdiction.

Case Title: Principal Commissioner of Customs & Anr. v. L'Oréal S.A.: Date of Order: May 15, 2025
Case No.: CM(M)-IPD 19/2025:Neutral Citation: 2025:DHC:3925:Name of Court: High Court of Delhi:Name of Judge: Hon'ble Mr. Justice Saurabh Banerjee

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539