Sana Herbals Pvt Ltd v. Mohsin Dehlvi

1. The present application has been filed on behalf of the defendant under Order XIV Rule 5 of the Code of Civil Procedure, 1908 (CPC) for framing of the following additional issues: “(x) Whether the registration of the trademarks with the name and style of „Dehlvi‟, either independently or as supporting word, as mentioned in Para 12 of the plaint, in favour of the Plaintiff, are invalid and based on false user and thus, liable to be cancelled / removed? OPD

(xi) Whether the alleged Assignment Deed dated 19.09.1999 is a legally valid instrument? OPD” 2. On 29th November, 2022, the statement of counsel for the plaintiff was recorded that he does not wish to file reply and the application may be heard on the basis of oral submissions.

3. The brief facts relevant for deciding the present application are set out below: 3.[1] The present suit has been filed alleging infringement of trade marks, copyright and passing off of the trademark/label “DEHLVI”. 3.[2] The plaintiff claims to be the proprietor of the mark “DEHLVI”. 3.[3] The defendant has filed written statement opposing the reliefs sought in the plaint, inter alia, pleading that the various registrations of the mark/label “DEHLVI” in favour of the plaintiff are invalid and liable to be cancelled. It has further been pleaded in the written statement that the alleged Assignment Deed dated 19th September, 1999 is a void instrument. 3.[4] An application under Section 124 of the Trade Marks Act, 1999, being I.A. 311/2017, was filed on behalf of the defendant, whereby permission was sought from the Court to institute appropriate proceedings for revocation/cancellation of the plaintiff’s trademarks before the Intellectual Property Appellate Board (IPAB) and for stay of the present suit. 3.[5] Issues were framed in the suit on 29th April, 2019 and an observation was made by the Court that since no issue with regard to validity of the marks of the plaintiff was framed, I.A. 311/2017 was liable to be BANSAL dismissed. However, the matter was listed on 26th November, 2019 for arguments on I.A. 311/2017. 3.[6] In the order dated 26th November, 2019 passed by this Court, it was noted that the defendant was not pressing I.A. 311/2017 and consequently, the said application was dismissed as not pressed. 3.[7] In the year 2022, various rectification petitions, including C.O. (COMM.IPD-TM) 100/2022, were filed on behalf of the defendant seeking cancellation of the registrations granted in favour of the trademark “DEHLVI”. 3.[8] On 19th September, 2022, another rectification petition filed by the petitioner in respect of the trademark “DEHLVI”, being C.O. (COMM.IPD-TM) 100/2022, was withdrawn by the petitioner/defendant with liberty to file the petition afresh, after taking appropriate steps in the present suit. 3.[9] Accordingly, the defendant has filed the present application on 8th October, 2022 for framing additional issues as aforesaid.

4. Counsel for the defendant has drawn attention of the Court to the pleadings in the written statement to contend that necessary averments have been made with regard to the invalidity of registrations of the plaintiff’s trademarks and invalidity of the Assignment Deed granted in favour of the plaintiff. Therefore, issues in this regard are required to be framed. He submits that the withdrawal of the application under Section 124 of Trade Marks Act was on account of the fact that the defendant did not want the present suit to be stayed. He further submits that with the coming into effect BANSAL of the Tribunals Reforms Act, 2021, the IPAB stands abolished and even the rectification applications have to be heard by this Court. Therefore, the rectification petitions filed by the defendant can be clubbed and tried along with the present suit and no prejudice would be caused to the plaintiff.

5. Per contra, counsel for the plaintiff submits that the defendant was conscious that permission was required from the Court before filing a rectification petition and accordingly filed I.A 311/2017 seeking permission of the Court. No issue with regard to the invalidity of the trademarks of the plaintiff was framed by this Court and I.A. 311/2017 was dismissed as not pressed. Therefore, the defendant has consciously chosen not to press the issue regarding the invalidity of plaintiff’s trademarks and under the garb of the present application, the defendant cannot raise the aforesaid issue again. Reliance is placed on the judgments in Shiv Prasad v. Durga Prasad & Anr., (1975) 1 SCC 405; Anil Dinmani Shanker Joshi & Anr. v. Chief Officer, (2003) SCC OnLine BOM 24; Jaswant Rai & Ors. v. Municipality, Badthinda, (2014) SCC OnLine P&H 25276; and, Krishna Saini v. Chameli Devi &Ors., (2011) SCC OnLine Del 2258 (DB).

6. I have heard the rival submissions and examined the record of the case.

7. In Patel Field Marshal Agencies v. P.M. Diesels Ltd., (2018) 2 SCC 112, the Supreme Court observed that where, during the pendency of a suit, a rectification application is filed, the application can be pursued only upon a finding by the Civil Court on the prima facie tenability of the plea of invalidity. If the Civil Court does not find a triable issue on the plea of invalidity, then the said application cannot be pursued. The Supreme Court BANSAL noted that this was necessary so as to avoid multiple proceedings on the same issue and the possibility of conflicting decisions. However, there have been subsequent developments since the passing of judgment in Patel Field Marshal Agencies (supra). In terms of the Tribunals Reforms Act, 2021, the IPAB has been abolished and the jurisdiction to decide rectification petitions now vests with the High Court under Section 21 of the Act. Therefore, now the suit as well as the rectification applications have to be decided by one authority alone i.e. the High Court and resultantly, there cannot be any possibility of conflicting decisions. Hence, the rectification petitions can be clubbed with the civil suits and there is no requirement of staying the civil suit.

8. In Abbott Healthcare Pvt. Ltd. v. Raj Kumar Prasad & Anr., 2018 SCC OnLine Del 6657, a Co-ordinate Bench of this Court was seized of a similar application filed on behalf of the plaintiff seeking framing of an additional issue with regard to validity of the registration of the defendant’s trademark. In the said suit, issues were framed prior to the filing of the Section 124 application and no issue with regard to invalidity of the defendant’s trademark had been urged or framed. Noting that no issue with regard to validity of the impugned trademark was framed in the suit, the application filed on behalf of the plaintiff under Section 124 of the Trade Marks Act, 1999 was subsequently dismissed by the Court with the liberty to apply afresh in the event additional issues were framed in the suit. Relying on the dicta of S. Surjit Singh Sahni v. Brij Mohan Kaur, (1997) 65 DLT 670, the Co-ordinate Bench of this Court observed that framing of issues is the duty of the Court and rejection of an earlier prayer does not BANSAL debar a fresh prayer for framing an issue if it arises from the pleadings and ought to have been framed but has inadvertently not been framed. The relevant observations of the Court in Abbott Healthcare Pvt. Ltd. (supra) are set out below: “12. The counsel for the plaintiff, in rejoinder, refers to S. Surjit Singh Sahni v. Brij Mohan Kaur 65 (1997) DLT 670 and on order dated 30th April, 2013 in CS(OS) No. 1457/2009 titled Ranbaxy Laboratories Ltd. v. Intas Pharmaceuticals Ltd. and against which no appeal is stated to have been preferred, holding that framing of issues is the duty of the Court and rejection of an earlier prayer does not debar a fresh prayer for framing an issue if it arises from the pleadings and ought to have been framed and has mistakenly not been framed. It is argued that the Court, at the time of framing of issues on 21st March, 2016, has not applied its mind and not refused to frame the issue about invalidity. It is thus contended that the plaintiff can apply for framing of additional issue.

13. I tend to agree with the counsel for plaintiff. The Code of Civil Procedure, 1908 (CPC), vide Order XIV Rule 5 empowers the Court to, at any time before passing a decree, amend the issues or frame additional issues and provides that all such amendments or additional issues as may be necessary for determining the maters in controversy between the parties shall be so made or framed. Thus, merely because at the time of framing of issues, an issue though arising from pleadings, has not been pressed and/or framed would not stop a subsequent application. The position may be different where an issue is pressed and not framed by a speaking order. In such case, the bar of res judicata, also applicable at successive stages of same proceeding, may come in way of an application under Order XIV Rule 5 CPC. However, in the present case, a perusal of order dated 21st March, 2016, when issues were framed, does not show any such thing.” BANSAL

9. The facts in Abbott Healthcare (supra) are similar to that of the present case. In the said case, the Court dismissed the Section 124 application as no issue had been framed with regard to invalidity of the trademark. In the present case also, no issue was framed by the Court with regard to invalidity of the registrations of the plaintiff’s marks and the defendant withdrew the application filed under Section 124 of the Trade Marks Act, 1999. However, like in Abbott Healthcare (supra), as per the order dated 19th September, 2022 in C.O. (COMM.IPD-TM) 100/2022, liberty was given to the defendant herein to apply for framing of additional issues.

10. Therefore, what has to be examined is whether the defendant has made the necessary averments in the written statement with regard to the invalidity of the plaintiff’s trademarks so as to frame an issue in this regard.

11. A perusal of the written statement filed on behalf of the defendant shows that defendant has pleaded that; (i) the plaintiff company came into existence only on 21st October, 1997, whereas the defendant has been using the trademark “DEHLVI” since 1995 (page 17 of the written statement); (ii) the plaintiff claims rights in the trademark “DEHLVI” only on the basis of the Assignment Deed dated 19th September, 1999, which is invalid and void ab initio (pages 12 and 17 of the written statement); and, (iii) the registration obtained by the plaintiff is on the basis of false user and therefore, the registered trademarks of the plaintiff are liable to be cancelled and pending registration applications liable to be refused (paragraph 24, page 22 of the written statement). BANSAL

12. A holistic reading of the written statement leads me to conclude that the defendant has made necessary pleadings with regard to (i) invalidity of the Assignment Deed dated 19th September, 1999; and (ii) the invalidity of the trademark registrations granted in favour of the plaintiff. These are material propositions of fact in terms of Order XIV Rule 1 of the CPC and therefore, an issue ought to have been framed with regard to the same.

13. It is the settled position of law that it is the obligation of the Court to frame issues. In this regard reference may be made to paragraph 7 of the S. Surjit Singh Sahni (supra): “7. A perusal of the several provisions contained in Order 14 of the CPC would be apposite. An issue arises when a material proposition of fact or law is affirmed by one party and denied by the other. Every such proposition shall form the subject of a distinct issue. Primarily it is the obligation of the Court to frame the issues. Failure on the part of the Court may be remedied by either party inviting attention of the Court to the need of framing such an issue either by participating in the process of settlement of issues or by moving an application under Order 14 Rule 5 of the CPC. It is obligatory on the part of the Court to frame an issue once it is satisfied that an issue which should have been framed was not framed. If the trial court fails in framing an issue or fails to remedy its earlier failure then even an appellate court is vested with power of framing an issue under Rule 25 of Order 41 of the CPC.” [emphasis supplied]

14. In light of the dicta above, even if the counsel for the defendant did not press for framing of the issues sought to be framed now, it would not mean that the Court cannot, at a subsequent stage, frame such issues if they emerge from the pleadings in the suit. The language of Order XIV Rule 5 of BANSAL the CPC is very wide and empowers the Court to amend the issues so framed or frame additional issues at any time before passing of the final decree.