Patel Field Marshal Agencies and Anr.  v. P.M. Diesels Ltd. and Ors.

Patel Field Marshal Agencies and Anr.  v. P.M. Diesels Ltd. and Ors.

2018 (73) PTC 15 (SC)

The Respondents were the registered owner of three trademarks, the common feature of all of which was the words “Field Marshal”. Out of the three, the first trademark was registered in 1964 and the second and third were registered in 1968.

The Appellants had applied for the registration of the trademark ‘Marshal’ in 1982.

Eventually, a suit was filed in the Delhi High Court. During the pendency of the suit, Appellants applied to the High Court of Gujarat[1] for rectification of the Respondents’ trade marks. High Court of Gujarat dismissed (Single Judge – Affirmed By Division Bench) the Rectification Petitions of the Appellants.

Aggrieved by the order of the Gujarat High Court the Appellants filed the present SLP before the Supreme Court.

The Supreme Court formulated the following issue for determination in the present matter:

“In a situation where a suit for infringement is pending wherein the issue of validity of the registration of the trade mark in question has been raised either by the Plaintiff or the Defendant and no issue on the said question of validity has been framed in the suit or  if framed has not been pursued by the concerned party in the suit by filing an application to the High Court for rectification Under Sections 111 read with Section 107 of the Trade and Merchandise Marks Act, 1958, whether recourse to the remedy of rectification Under Sections 46/56 of the 1958 Act would still be available to contest the validity of the registration of the Trade mark.”

As the registrations, suit and all proceedings were prior to the coming into force of the Trade Marks Act, 1999 and were in fact under Trade and Merchandise Marks Act, 1958 (1958 Act), the Hon’ble Supreme Court considered the relevant provisions of Sections 46[2], 56[3], 107[4] and 111[5] of the Trade and Merchandise Marks Act, 1958 to decide upon the aforesaid.

The decision is valuable as the requirement of the above said provisions are now found in Sections 47, 57, 124 and 125 of the Trade Marks Act, 1999 (‘1999 Act’) which is the current governing law on the subject. Hence, the decision in the present case is applicable in cases under the 1999 Act, wherein rectifications are filed or sought to be filed after the institution of the suit.

In fact the Supreme Court itself states that it precedents that require elaboration are under the 1999 Act and Sections 46, 56, 111 and 107 of the 1958 Act correspond to Sections 47, 57, 124 and 125 of the 1999 Act.

Appellants’ Contentions:

• Sections 107 and 111 contemplate grant of permission by Trial Court for filing of a rectification application, which requirement does not seem to follow from a reading of the said provisions.
• The 1958 Act grants rights to i) the owner of the registered trademark ; and ii) the person who is aggrieved by the registration. Both the persons can exercise their rights parallel and independently.
• Only requirement for filing a rectification application under the Sections 107 and 111 of the 1958 Act is that person filing such an application must be a “person aggrieved”.
• Requirement of permission of a District Court for filing of the rectification application before High Court, in the light of the provisions of Sections 107 and 111, cannot be the legislative intent.

Respondents’ Contentions:

• Sections 46 and 56 relate to matters where no suits are pending adjudication for infringement of the trademark.
• Where a suit for infringement has been filed and the question of validity of registration arises therein and the Civil Court is satisfied as to the prima facie tenability of the issue of invalidity of the registration of the trade mark, the provisions of Section 111 would take over and govern the proceedings in the suit including the issue of invalidity.
• Abandonment of the plea of invalidity contemplated by Section 111(3) of the 1958 Act is a complete relinquishment for all practical purposes and not only for the purpose of the suit.

Court’s Observations:

Sections 46 and 56 provide a statutory right to seek rectification if the parties have not moved the Civil Court. However, the questions regarding the validity of the registration of a trademark are to be answered by the Registrar/Tribunal[6], not the Civil Court.

If any of the parties have moved the Civil Court claiming infringement and the questions regarding the validity of the registration of a trademark have been raised then they are to be answered by the tribunal, not the Civil Court. This will happen only if the Civil Court is satisfied (as regards prima facie tenability of the plea of invalidity) and has framed an  issue to that effect. The decision of the tribunal will be final and binding.

However if any of the parties do not move the tribunal for rectification after the CivilCourt’s order then the plea for rectification shall be relinquished by the parties. The plea for rectification would stop if it is abandoned and the recourse under Sections 46 and 56 would be closed for the parties.

Intention of the legislature while enacting Section 111 was to address the question of invalidity first and foremost. Thereafter the suit would proceed with other issues depending upon the decision of the Tribunal on the Invalidity issues.

The appeals were dismissed. The above formulated issue was answered in negative.

[1] Before the creation of the Intellectual Property Appellate Board, the current jurisdiction of the IPAB was exercised by High Courts.

[2] Section 46 states that if a trademark has been registered with no intention of using it and if it has not been used for a month prior to the application of removal of the trademark or five years in a row then the said trademark can be removed from the register. 46. Removal from register and imposition of limitations on ground of non-use.

(1) Subject to the provisions of Section 47, a registered trade mark may be taken off the register in respect of any of the goods in respect of which it is registered on application made in the prescribed manner to a High Court or to the Registrar by any person aggrieved on the ground either-

(a) that the trade mark was registered without any bona fide intention on the part of the applicant for registration that it should be used in relation to those goods by him or, in a case to which the provisions of Section 45 apply, by the company concerned, and that there has, in fact, been no bona fide use of the trade mark in relation to those goods by any proprietor thereof for the time being up to a date one month before the date of the application; or

(b) that up to a date one month before the date of the application, a continuous period of five years or longer had elapsed during which the trade mark was registered and during which there was no bona fide use thereof in relation to those goods by any proprietor thereof for the time being:

Provided that, except where the applicant has been permitted Under Sub-section (3) of Section 12 to register an identical or nearly resembling trade mark in respect of the goods in question or where the tribunal is of opinion that he might properly be permitted so to register such a trade mark, the tribunal may refuse an application Under Clause (a) or Clause (b) in relation to any goods, if it is shown that there has been, before the relevant date or during the relevant period, as the case may be, bona fide use of the trade mark by any proprietor thereof for the time being in relation to goods of the same description, being goods in respect of which the trade mark is registered.

(2) Where in relation to any goods in respect of which a trade mark is registered-

(a) the circumstances referred to in Clause (b) of Subsection (1) are shown to exist so far as regards non-use of

the trade mark in relation to goods to be sold, or otherwise traded in, in a particular place in India (otherwise than for export from India), or in relation to goods to be exported to a particular market outside India; and

(b) a person has been permitted Under Sub-section (3) of Section 12 to register an identical or nearly resembling trade mark in respect of those goods under a registration extending to use in relation to goods under to be sold, or otherwise traded in, or in relation to goods to be so exported, or the tribunal is of opinion that he might properly be permitted so to register such a trade mark, on application by that person in the prescribed manner to a High Court or to the Registrar, the tribunal may impose on the registration of the first-mentioned trade mark such limitations as it thinks proper for securing that registration shall cease to extend to such use. (3) An applicant shall not be entitled to rely for the purpose of Clause (b) of Sub-section (1) or for the purposes of Sub-section (2) on any non-use of a trade mark which is shown to have been due to special circumstances in the trade and not to any intention to abandon or not to use the trade mark in relation to the goods to which the application relates.

[3] Section 56 states that the tribunal has the power to cancel or modify the registration of the trademark if any provisions of the Trade and Merchandise Marks Act, 1958 are contravened or if any of the conditions for which the trademark has been obtained, are not satisfied. 56. Power to cancel or vary registration and to rectify the register. (1) On application made in the prescribed manner to a High Court or to the Registrar by any person aggrieved, the tribunal may make such order as it may think fit for cancelling or varying the registration of a trade mark on the ground of any contravention, or failure to observe a condition entered on the register in relation thereto.

(2) Any person aggrieved by the absence or omission from the register of any entry, or by any entry made in the register without sufficient cause, or by any entry wrongly remaining on the register, or by any error or defect in any entry in the register, may apply in the prescribed manner to a High Court or to the Registrar, and the tribunal may make such order for making, expunging or varying the entry as it may think fit.

(3) The tribunal may in any proceeding under this Section decide any question that may be necessary or expedient to decide in connection with the rectification of the register.

(4) The tribunal, of its own motion, may, after giving notice in the prescribed manner to the parties concerned and after giving them an opportunity of being heard, make any order referred to in Subsection (1) or Sub-section (2).

(5) Any order of the High Court rectifying the register shall direct that notice of the rectification shall be served upon the Registrar in the prescribed manner who shall upon receipt of such notice rectify the register accordingly.

(6) The power to rectify the register conferred by this Section shall include the power to remove a trade mark registered in Part A of the register to Part B of the register.

[4] Section 107 states that if an application is filed for challenging a registered trademark then it should be made to the High Court and not the Registrar of Trademarks. 107. Application for rectification of register to be made to High Court in certain cases.

(1) Where in a suit for infringement of a registered trade mark the validity of the registration of the Plaintiff’s trade mark is questioned by the Defendant or where in any such suit the Defendant raises a defence Under Clause (d) of Sub-section (1) of Section 30 and the Plaintiff questions the validity of the registration of the Defendant’s trade mark, the issue as to the validity of the registration of the trade mark concerned shall be determined only on an application for the rectification of the register, and notwithstanding anything contained

in Section 46, Sub-section (4) of Section 47 or Section 56, such application shall be made to the High Court and not to the Registrar.

(2) Subject to the provisions of Sub-section (1), where an application for rectification of the register is made to the Registrar Under Section 46 or Sub-section (4) of Section 47 or Section 56, the Registrar may, if he thinks fit, refer the application at any stage of the proceeding to the High Court.

[5] 111. Stay of proceedings where the validity of registration of the trade mark is questioned, etc. (1) Where in any suit for the infringement of a trade mark-

(a) the Defendant pleads that the registration of the Plaintiff’s trade mark is invalid; or

(b) the Defendant raises a defence Under Clause (d) of Sub- section (1) of Section 30 and the Plaintiff pleads the

invalidity of the registration of the Defendant’s trade mark, the court trying the suit (hereinafter referred to as the

court), shall,-

(i) if any proceedings for rectification of the register in relation to the Plaintiff’s or Defendant’s trade mark are

pending before the Registrar or the High Court, stay the suit pending the final disposal of such proceedings;

(ii) if no such proceedings are pending and the court is satisfied that the plea regarding the invalidity of the

registration of the Plaintiff’s or Defendant’s trade mark is prima facie tenable, raise an issue regarding the same and adjourn the case for a period of three months from the date of the framing of the issue in order to enable the party concerned to apply to the High Court for rectification of the register.

(2) If the party concerned proves to the court that he has made any such application as is referred to in Clause (b) (ii) of Sub-section (1) within the time specified therein or within such extended time as the court may for sufficient cause allow, the trial of the suit shall stand stayed until the final disposal of the rectification proceedings.

(3) If no such application as aforesaid has been made within the time so specified or within such extended time as the court may allow, the issue as to the validity of the registration of the trade mark concerned shall be deemed to have been abandoned and the court shall proceed with the suit in regard to the other issues in the case.

(4) The final order made in any rectification proceedings referred to in Sub-section (1) or Sub-section (2) shall be binding upon the parties and the court shall dispose of the suit conformably to such order in so far as it relates to the issue as to the validity of the registration of the trade mark.

(5) The stay of a suit for the infringement of a trade mark under this Section shall not preclude the court making any interlocutory order (including any order granting an injunction, directing accounts to be kept, appointing a receiver or attaching any property), during the period of the stay of the suit.

[6] Here Tribunal also includes High Court’s power of deciding on Invalidity under the 1958 Act.

Co-author: Ms. Pragati Pachisia, JCCLC