This case was spurred by a complaint from logistics firm DRS, which pointed out that searches for its trademark “Agarwal Packers and Movers” returned competitor websites.

DRS alleged that Google’s ad mechanism exploited its trademark to divert users to rival sites.

Upholding the initial order, the division bench directed Google to act on DRS’s grievances and eliminate offending ads.

“One of the worst ways to spend money as a business is to advertise against your own keywords,” said Nithin Kamath, founder and chief executive of trading platform Zerodha, of the ruling in a thread on social media X.

The court’s assertion that Google is not a “passive intermediary” but runs an advertisement business, over which it has “pervasive control,” comes as a significant blow to the tech giant.

“Merely because the said business is run online and is dovetailed with its service as an intermediary, does not entitle Google to the benefit of Section 79(1) of the IT (Information Technology) Act, in so far as the Ads Programme is concerned,” the bench ruled.

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