M/S. Godrej Sara Lee Limited vs Pty.Ltd.&Amp; Anr on 29 January, 2010
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Supreme Court of India
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 996-997/2010
(Arising out of SLP(C)Nos.21955-21956 of 2008) M/S. GODREJ SARA LEE
LIMITED .. Appellant Vs.
RECKITT BENCKISER AUSTRALIA
PTY.LTD.& ANR. .. Respondents J U D G M E N T
ALTAMAS KABIR, J.
1. Leave granted.
2. Two First Appeals were filed in the Delhi High Court, being FAO No.131 and
132 of 2008, against two orders, both dated 28th March, 2008, passed by the
Controller of Patents and Designs, Kolkata, 2
under Section 19(1) of the Designs Act, 2000, cancelling two registered
designs for "Insecticide Coil" in Class 12 belonging to the
Respondent No.1 herein. The question for determination before the High Court
in the two appeals was whether the Delhi High Court had jurisdiction to
entertain the same against the order passed by the Controller of Patents and
Designs, Kolkata. Inasmuch as, in the said two appeals, it was held by the
Delhi High Court that it had jurisdiction to entertain the appeals, these two
appeals have been preferred by M/s. Godrej Sara Lee Ltd. against the said
decision.
3. On 27th January, 2005, the Respondent No.1 herein, M/s. Reckitt Benckiser
Australia Pty. Ltd., filed a suit, being C.S.(O.S.)No.121 of 2005, against the
appellant, in the Delhi High Court alleging infringement of its Registered
Designs bearing Nos.184136 and 184137. The said suit is 3
yet to be decided. On 4th February, 2005, the appellant herein filed his
written statement in the suit, inter alia, contending that the aforesaid
Designs of the Respondent No.1 were liable to be cancelled under Section 22(3)
of the Designs Act, 2000, on the ground that registration of the same had been
obtained by concealment of facts and infringement of the Designs Registration
Nos. 197811 and 197426, before the Controller of Designs at Kolkata.
Similarly, the appellant herein also filed a Designs Cancellation Petition for
cancellation of the Registered Design Nos.184135, 184136 and 184137 standing in
the name of the Respondent No.1 on the same ground as alleged by the
respondent in its petition for cancellation of the appellant's Designs. After
certain interlocutory proceedings relating to the prayer made for transfer of
the cancellation proceedings from the Controller of Designs to the Delhi High
Court, the Controller of Designs heard the parties 4
on 5th March, 2008 and reserved his order. Meanwhile, the respondents filed
FAO (OS) No.101/08 against the orders dated 13.2.2008 and 5.3.2008 passed by
the Controller of Designs, Kolkata and the same was converted into a Petition
under Article 227 of the Constitution. Initially the learned Single Judge was
doubtful about the maintainability of the appeals. Thereafter, on 28th March,
2008, by three separate orders the Controller of Designs, Kolkata, cancelled
the Registered Design Nos.184135, 184136 and 184137 belonging to Respondent
No.1. As indicated hereinabove, three First Appeals were preferred before the
Delhi High Court, where a question arose with regard to the High Court's
jurisdiction to entertain the appeals and by the orders impugned in these
appeals the Delhi High Court held that the appeals were maintainable and it had
jurisdiction to entertain the same.
5
4. Appearing in support of the appeals, Mr. Dushyant Dave, learned Senior
Advocate, questioned the decision of the Delhi High Court based on the
interpretation of Section 19(2) read with Section 2(e) of the Designs Act,
2000. He submitted that the expression "High Court" as used in
Section 19(2) and Section 2(e), would have to be read in relation to the cause
of action and not otherwise. In the instant case, since the cause of action for
the appeal has arisen on account of the cancellation of Designs by the
Controller of Designs at Kolkata, it is only the Calcutta High Court, which
would have jurisdiction to entertain the appeals under Section 19. Any other
interpretation would be contrary to the principles relating to the filing of
suits where the cause of action arises as contemplated under Section 20 of the
Code of Civil Procedure.
6
5. Mr. Dave urged that the High Court appears to have gone wrong in making a
comparison between the provisions relating to cancellation of designs under
Section 51A of the Designs Act, 1911 and Section 19 of the Designs Act, 2000.
Mr. Dave urged that while Section 51A of the 1911 Act allowed a person to move
for cancellation directly before the High Court in its original jurisdiction,
under Section 19 of the 2000 Act an application for cancellation could only be
made to the Controller of Designs, Kolkata. Mr. Dave urged that the
conclusions arrived at by the High Court on an analysis of the two provisions
were erroneous as was the reliance placed by the High Court on the decision in
the case of Girdharilal Gupta vs. M/s. K. Gian Chand Jain & Co. [(1978) 14
D.L.T. 132].
6. Mr. Dave submitted that the decision in the said case was clearly
distinguishable on facts, as also the finding that the cancellation of a design
7
under Section 51A of the 1911 Act could be filed either in the High Court
having jurisdiction over the place at which the design is registered or in the
High Court, the local jurisdiction of which has a nexus with the subject matter
of the cause of action of the application. Mr. Dave urged that in the said
case, the High Court made it clear that an application for cancellation cannot
be made in any High Court merely because the applicant chose to do so. In
fact, the applicant would have to establish the jurisdiction of the High Court
to which the application is made by establishing a live link between the
territory in which the cause of action and the subject matter of the
application. Mr. Dave submitted that the sum total of the decision in
Girdharilal Gupta's case is that in the normal course both the Calcutta High
Court and the High Court within whose territorial jurisdiction the cause of
action arises, would have jurisdiction to entertain an appeal under Section 8
19 of the Designs Act, 2000, but in some cases such jurisdiction would also
extend to any other High Court within the local limits of which a part of the
cause of action and/or subject matter of the application may arise or be
situate. Mr. Dave urged that the latter part of the findings was not in
consonance with Section 19(2) of the 2000 Act.
7. Mr. Dave submitted that a different view had been expressed by a learned
Single Judge of the Delhi High Court in M/s. Scooters India Ltd. vs. M/s. Jaya
Hind Industries Ltd. & Anr. [AIR 1988 Delhi 82], wherein it was held that
rejection of an application for grant of patent under the provisions of the
Patents Act, 1970, and the Patents Rules, 1972, by the Deputy Controller of
Patents and Designs, Bombay, gave rise to a cause of action whereby appeal
against such order of refusal could be filed only in the Bombay High Court and
not in any other High Court.
9
8. Reference was then made by Mr. Dave to the decision of this Court in Ambika
Industries vs. Commissioner of Central Excise [(2007) 6 SCC 769], wherein the
question as to which High Court would have the jurisdiction to entertain an
appeal from an order of the Appellate Tribunal exercising jurisdiction over
several States, was in question and this Court held that it had to be
determined on the basis of the statutory provisions and nothing else such as
dominus litus or the situs of the Appellate Tribunal or the cause of action.
Accordingly, where the first forum was located in the State other than the
State where the Appellate Tribunal was located, the appropriate High Court to
entertain the appeal was the High Court situated in the former State and not
the High Court situated in the latter State.
9. Mr. Dave also referred to the decision of this Court in Canon Steels (P)
Ltd. vs. Commissioner of 10
Customs [(2007) 14 SCC 464] where the original order had been passed under the
Customs Act at Mumbai whereas the appellate order was passed by the Customs
Excise and Service Tax Appellate Tribunal (CESTAT) at Delhi. Appeal under
Section 130 of the Customs Act, 1962, filed in the High Court at Delhi was
withdrawn with liberty to file the appeal in the appropriate place. An appeal
was subsequently filed in the Punjab and Haryana High Court at Chandigarh on
the ground that a part of the cause of action had arisen at Chandigarh. The
Punjab and Haryana High Court, however, held that it had no jurisdiction to
entertain the appeal. Affirming the said view, this Court held that since
neither the original nor the appellate orders were passed within the
territorial jurisdiction of the Punjab and Haryana High Court, it was the Delhi
High Court which had jurisdiction to entertain the appeal.
11
10. Mr. Dave submitted that similarly since the order impugned in the appeal
had been passed in Kolkata, it was the Calcutta High Court and not the Delhi
High Court which had jurisdiction to entertain the statutory appeal under
Section 19 of the Designs Act, 2000.
11. Several other decisions were also cited by Mr. Dave on similar lines which
need not detain us at present.
12. Mr. Dave submitted that the Delhi High Court was apparently persuaded to
make a comparison between the provisions of Section 51A of the Designs Act,
1911 and Section 19(2) of the Designs Act, 2000, which led to erroneous
reliance being placed on the decision of the Delhi High Court in Girdharilal
Gupta's case (supra) the facts whereof were completely different and
distinguishable from the facts of this case. Mr. Dave submitted that 12
having regard to the above, the impugned judgment of the High Court was liable
to be set aside.
13. Mr. Chander Lall, learned advocate, appearing for the Respondent No.1,
referred to Sections 19 and 22(2) (b) read with Section 22(3) of the Designs
Act, 2000, and contended that the said provisions contemplated cancellation of
a Design by the Controller of Designs, and punishment for piracy of a Design
in any suit in any Court not below that of a District Judge. Mr. Lall submitted
that when such a suit was pending before the High Court and a defence as
provided for under Section 19 of the Act was taken, the matter had to be
decided by the High Court and the Controller ought not to be left to decide the
said issue, as an appeal from the Controller's order would also lie to the
High Court under Section 19 which could result in conflict of decisions. In
this regard reference was made to the Full Bench decision of 13
the Delhi High Court in M/s Metro Plastic Industries (Regd.) vs. M/s Galaxy
Footwear, New Delhi (AIR 2000 Delhi 117), in which the question for decision
was whether an injunction could be granted in favour of a registered owner of a
design when an application under Section 51-A of the Designs Act, 1911, was
pending. After examining the provisions of Section 51 A, the Full Bench on a
reference to Sections 53 and 54 relating to piracy of registered designs and
the incorporation of the provisions of the Patents Act, 1970, into the Designs
Act, held that the powers conferred under Section 53 were not absolute and did
not contemplate an absolute right in the owner to prevent all other persons
from infringing that design under all circumstances. It was held further that
Section 53 creates a right in a registered owner and in the absence of an
application for cancellation such a right can be enforced and no defence can
be taken based on a ground of 14
cancellation. But once an application for cancellation is filed, the Court
trying a suit under Section 53 would not be entitled to ignore the same.
14. Mr. Lall then submitted that there were innumerable instances of appeals
having to be filed at the place where the cause of action had arisen or the
effect thereof was felt. By way of example, Mr. Lall submitted that appeals
against orders passed by the Company Law Board would lie only before the Delhi
High Court. The decision in Stridewell Leathers (P) Ltd. vs. Bhankerpur
Simbhaoli Beverages (P) Ltd. [(1994) 1 SCC 34] was also referred to in this
regard.
15. Mr. Lall submitted that full disclosures had not been made regarding the
pendency of the suit filed by the respondent, which is still pending decision,
wherein the appellant had filed a counter affidavit and a defence had been
taken against 15
cancellation. Mr. Lall submitted that for the reasons aforesaid and also in
view of the fact that under the Designs Act, 2000, only the Controller of
Designs had the jurisdiction to cancel a design, no interference was called for
with the order of the Delhi High Court ruling on its jurisdiction to entertain
the Appeals under Section 19 of the 2000 Act.
16. Countering the submissions made by Mr. Lall with regard to the jurisdiction
of the Delhi High Court, Mr. Dave concluded on the note that after the
enactment of the Design Act, 2000, it is only the Controller of Designs before
whom an application can be made under Section 19 for cancellation of a Design
in contrast to the provisions of Section 51 A of the 1911 Act under which even
the High Court could cancel the registration of a Design. Mr. Dave urged that
in view of the amendments in Section 51-A of the 1911 16
Act the question of jurisdiction of the Delhi High Court to entertain the
appeals has become relevant.
17. The answer to the question thrown up in these appeals involves the
interpretation of the expression "High Court" used in Sections 19(2)
and 22(4) of the 2000 Act and in Section 51A of 1911 Act.
18. Section 51A of the 1911 Act which deals with "Cancellation of
Registration", provides as follows:
"51A. Cancellation of registration. (1) Any person interested may present
a
petition for the cancellation of the
registration of a design-
(a) at any time after the registration
of the design, to the High Court on
any of the following grounds, namely:-
(i) that the design has been
previously registered in India; or
(ii) that it has been published in
India prior to the date of
registration ; or
(iii) that the design is not a new
or original design ; or
17
(b) within one year from the date of
the registration, to the Controller on
either of the grounds specified in
sub-clauses (i) and (ii) of clause
(a).
(2) An appeal shall lie from any order of the Controller under this
section to the High Court, and the Controller may at any time refer any such
petition to the High Court, and the High Court shall decide any petition so
referred."
19. Section 51A(1)(a) very clearly provides that at any time after registration
of the design, an application for cancellation of the registration could be
made to the High Court on the grounds indicated therein. Section 51A(1)(b)
makes an exception and provides that within one year from the date of
registration of the design, an application could be made for cancellation of
the registration to the Controller on the grounds specified in Sub-clauses (i)
and (ii) of Clause (a). Section 51A(2) provides that an appeal from 18
the order of the Controller would lie to the High Court.
20. Section 19 of the 2000 Act, on the other hand, provides as follows :
"19. Cancellation of registration.-(1) Any person interested may present
a petition for the cancellation of the registration of a design at any time
after the
registration of the design, to the Controller on any of the following
grounds, namely:-
(a) that the design has been
previously registered in India; or
(b) that it has been published in
India or in any other country prior to
the date of registration; or
(c) that the design is not a new or
original design; or
(d) that the design is not registrable
under this Act; or
(e) that it is not a design as defined
under clause (d) of section 2.
(2) An appeal shall lie from any order of the Controller under this section
to the High Court, and the Controller may at any time refer any such petition to
the High 19
Court, and the High Court shall decide any petition so referred."
21. In contrast to the provisions of Section 51A(1)(a) of the 1911 Act, Section
19(1) of the 2000 Act, which also deals with cancellation of registration,
provides for a petition for cancellation of registration of a design to be
filed before the Controller and not to the High Court. On a comparison of the
two provisions of the two enactments, it will be obvious that under the 2000
Act the intention of the Legislature was that an application for cancellation
of a design would lie to the Controller exclusively without the High Court
having a parallel jurisdiction to entertain such matters. It is also very clear
that all the appeals from any order of the Controller under Section 19 of the
2000 Act shall lie to the High Court. The basic difference, therefore, as was
pointed out to the High Court and noticed by it, is that while under Section 19
of the 2000 Act 20
an application for cancellation would have to be made to the Controller of
Designs, under Section 51A of the 1911 Act an application could be preferred
either to the High Court or within one year from the date of registration to
the Controller on the grounds specified under Sub- clauses (i) and (ii) of
Clause (a) of Section 51A(1). Under Section 19 of the 2000 Act the power of
cancellation of the registration lies wholly with the Controller. On the other
hand, an application for cancellation of a design could be made directly to
the High Court under Section 51A of the 1911 Act. Under the 2000 Act, the High
Court would be entitled to assume jurisdiction only at the appellate stage,
whereas under Section 51A of the 1911 Act the High Court could itself directly
cancel the registration. Whereas in Girdharilal Gupta's case (supra), the
question of jurisdiction of the High Court was in relation to an application
made to the High Court directly, in 21
the instant case, we are concerned with an order of the Controller against
which an appeal is required to be filed before the High Court. While in
Girdharilal Gupta's case the Court was considering the expression "High
Court" in the context of a fall-out in respect of the ground of
registration and the cause of action arising on account of such fall-out, in
the present case, there is no question of any consequential impact since the
application for cancellation of registration was on the basis of fake
documents created in order to perpetrate a fraud.
22. The reliance placed by the High Court on the judgment in Girdharilal
Gupta's case (supra) appears to be misplaced, inasmuch as, while under the
1911 Act the High Court acts as an Original forum, under the 2000 Act the High
Court acts as an Appellate forum, which are two separate jurisdictions
operating in two different fields. 22
In the instant case, the doctrine of cause of action, as understood under
Section 20 C.P.C., has been imported on the basis of the provisions of Section
51A of the Designs Act, 1911, whereas the case of the appellant would fall
under Section 19 of the Designs Act, 2000, where the High Court functions as
the Appellate forum. The cause of action for the instant proceedings is most
certainly the cancellation of the registered design of the appellant which
happened in the State of West Bengal which gave the Calcutta High Court the
jurisdiction to deal with the matter. The Delhi High Court, in our view, erred
in holding that the cause of action had arisen within its local jurisdiction,
whereas the jurisdiction of the High Court was on account of the cancellation
of registration of the design and not on account of the impact thereof in any
particular State. This is what distinguishes the decision in Girdharilal
Gupta's case from the facts of this case. 23
23. Apart from the fact that the parties to the suit were in Kolkata, it is
clear that the cause of action for the suit arose in Kolkata by virtue of the
order passed by the Controller in relation to the appellant's design. As the
facts indicate, the cause of action for the suit arose in Kolkata, which, in
any event, had jurisdiction to entertain the suit. Having erroneously applied
the decision in Girdharilal Gupta's case (supra) to the facts of the case, the
High Court was led into error in holding that the consequence of the
cancellation gave jurisdiction to the Delhi High Court to entertain the suit,
without considering in its proper perspective the provisions of Section 51A of
the 1911 Act in contrast to the provisions of Section 19 of the 2000 Act.
24. The various decisions cited by Mr. Dave to support his submissions that the
question as to which High Court would have jurisdiction to 24
entertain an appeal under Section 19, had to be determined on the basis of the
statutory provisions and not on the basis of dominus litus or the situs of the
Appellate Tribunal or the cause of action. We are inclined to accept Mr. Dave's
submission that the Delhi High Court had erred in making a comparison between
the provisions of Section 51A of the 1911 Act and Section 19(2) of the 2000
Act, which operate on different planes.
25. Having regard to the above, we are of the view that the impugned order of
the Delhi High Court cannot be sustained and we, accordingly, set aside the
same and hold that in the instant case it is the Calcutta High Court which will
have jurisdiction to entertain the appeal under Section 19 of the 2000 Act.
The proceedings before the Delhi High Court are, therefore, quashed. The
Appellant is granted leave to move the Calcutta High Court against the order of
cancellation of its 25
design on the grounds taken in these Appeals, as well as such other grounds as
may be relevant for the purpose of deciding the question of cancellation of
the Appellant's design by the Controller of Designs, Kolkata, within 30 days
from date. If the appeals are filed within the said period, the delay in
taking such proceedings shall be condoned.
26. The appeals are, accordingly, allowed, but there will be no order as to
costs.
________________J.
(ALTAMAS KABIR)
________________J.
(CYRIAC JOSEPH)
New Delhi
Dated:29.01.2010.