In a commercial arbitration petition filed before the Bombay High Court wherein Zee Learn Ltd. (ZLL) sought interim reliefs pending arbitral proceedings and an order restraining the respondent from using the petitioner’s registered trademarks ‘MOUNT LITERA ZEE SCHOOL’ and its proprietary programme, a Single Judge Bench of Justice Amit Borkar passed certain directions and directed the respondent to comply with them until appropriate orders are passed by the Arbitral Tribunal under Section 17 of the Arbitration and Conciliation Act, 1996.
The petitioner also sought a direction upon the respondents to furnish a Bank Guarantee of Rs.48,39,440.76/-, and, in the alternative, appointment of a Court Receiver to collect the fees of the schools. The petitioner averred that the respondent was given a license to run LLZS programme in its school. However, in March 2026, the respondent deliberately breached the contract, and continued to use the petitioner’s trademark, brand, and proprietary programme even after termination.
The petitioner had been working in the field of education in India since 1994 and ran the ‘Mount Litera Zee School’ network of CBSE schools, having developed its own ‘MLZS Program’, with study material known as ‘Litera Gear’, consisting of textbooks, worksheets, equipment, uniforms and kits. The respondent had entered into various agreements with the petitioner from 2014 onwards, including the Academic Alliance Agreement dated 01-06-2017, the Intellectual Property Agreement dated 23-11-2016, and the Settlement Agreement dated 21-08-2024, the latter of which revived and reinstated the earlier agreements after prior litigation was withdrawn.
The respondent, having failed to place orders for Litera Gear for academic year 2026-2027 and having written to the Department for Education, State of Uttarakhand, alleging that the petitioner was forcing them to use their books, received a Notice of Breach dated 17-03-2026 from the petitioner. After replies in which the respondent indicated it would continue the alleged breaches, the petitioner terminated the agreements by notice dated 24-03-2026. The petitioner alleged that the respondent continued using the trademark, brand, and MLZS Program even after termination, in breach of Clause 7.5 of the IP Agreement and Clause 14.10 of the Academic Agreement.
On objection regarding territorial jurisdiction, the Court stated that the place where the school is situated and the place selected by the parties for arbitration are two different considerations. It was held that the arbitration clauses, both providing that ‘the place of arbitration shall be Mumbai’, designated Mumbai as the juridical seat. The Court found this reinforced by the parties’ prior conduct in an arbitration petition, where Mumbai had been recorded as venue and seat and the respondent had not disputed the arbitration agreement’s existence. Hence, the Court rejected the Respondent’s objection to jurisdiction.
Regarding the existence and validity of the arbitration agreement, the Court took note of the Intellectual Property Agreement dated 23-11-2016 and the Settlement Agreement dated 21-08-2024, both signed by both parties, and stated that the relationship could not be examined by taking the Alliance Agreement alone and ignoring the other agreements as well as the subsequent conduct of the parties. It was stated that the parties acted upon the contractual arrangement and that the disputes arising from the same contractual framework were earlier taken to arbitration. Stating that a party which invokes arbitration clause and seeks reference of the dispute to arbitration cannot contend that there is no arbitration agreement, the Court rejected the contention that there was no agreement to arbitrate.
Regarding the objection that ZLL’s power to appoint the sole arbitrator was defective, the Court held that this defect could be severed from the remainder of the arbitration agreement, leaving the agreement to arbitrate intact, with appointment to be made in accordance with law. It was also held that the entire arbitration agreement cannot be held invalid merely because the appointment mechanism required correction.
On the merits of the interim relief, the Court found that the petitioner established that following termination, the respondent had no contractual right to continue using the petitioner’s registered trademarks or represent continuing association as such use could create an impression that the former licensee was still connected with or had a license from the plaintiffs. On contractual provisions, the Court found that the respondent could not claim such a right of usage merely because the termination was disputed. The Court noted that the Government directions relied upon by the respondent, requiring use of NCERT, SCERT, ICSE, or CBSE textbooks while permitting supplementary material under CBSE Rule 2.4.7, did not establish that worksheets, workbooks, or supplementary educational material were prohibited in addition to the prescribed textbooks, particularly since the directions predated the relevant agreements.
The Court stated that the balance of convenience was in protecting the petitioner’s trademark rights and held that the respondent could not claim that use is necessary for protection of a contractual right when the agreement had been terminated. Regarding the prayer for discovery of documents and information, the Court stated that the disclosure should be confined to documents and records connected with the use of the petitioner’s marks and MLZS program, students enrolled in connection with such programme, fees received and accounts relevant to the monetary claims. The Court held that relevant documents had to be preserved so that they remained available during arbitral proceedings.
The Court rejected the prayer for a Bank Guarantee of Rs.48,39,440.76/- at this stage, and rejected the alternative prayer for appointment of a Court Receiver to collect fees, finding that such appointment would interfere with the day-to-day functioning of a school.
The petition was partly allowed and the respondent was restrained from conducting or representing any business, school, or educational programme under the name “MOUNT LITERA ZEE SCHOOL” or “MLZS,” from using or implementing the MLZS Program, and from using any indicia representing continuing association with the petitioner. Further, the respondent was directed to remove such marks from websites and promotional material within seven days. It directed preservation of documents and electronic records relating to use of the marks and MLZS Program after termination, and disclosure within four weeks of student enrolment and fee statements for Academic Year 2026-27, confined to matters connected with use of the petitioner’s marks and programme.
The respondent was directed to comply with the order until the Arbitral Tribunal passed appropriate orders under Section 17, and the petitioner was directed to take steps for commencement of arbitral proceedings within two months.
