UTO Nederland B.V. & Anr. Vs. Tilaknagar Industries Ltd.

Introduction: The interplay between judicial discretion and adjudication in the context of temporary injunctions is a cornerstone of civil litigation, particularly in intellectual property disputes. The case of UTO Nederland B.V. v. Tilaknagar Industries Ltd., decided by a Larger Bench of the Bombay High Court on April 28, 2025, under Chief Justice Alok Aradhe, Justices M.S. Karnik, and Shyam C. Chandak, addresses a critical conflict in judicial interpretations regarding the nature of orders on temporary injunction applications and the scope of appellate review. Stemming from a trademark dispute over “Mansion House” and “Savoy Club,” this reference case clarifies whether such orders are exercises of discretion or prima facie adjudications and delineates the appellate court’s role in reviewing them. By resolving conflicting Division Bench decisions, the court reinforces the discretionary nature of injunction orders and limits appellate interference to cases of arbitrary or perverse exercise of discretion. This case study provides a comprehensive analysis of the factual and procedural background, the issues at stake, the parties’ submissions, the judicial reasoning, and the legal principles established, offering insights into the procedural nuances of injunction appeals in India.

Detailed Factual Background:  UTO Nederland B.V. and its affiliate, major Dutch producers and distributors of spirits and liquors, including scotch whiskey, gin, vodka, rum, liqueurs, and cognac, claimed proprietorship over the trademarks “Mansion House” and “Savoy Club.” UTO Nederland asserted registration of “Mansion House” and continuous use of “Savoy Club” since 1947. Tilaknagar Industries Ltd., an Indian company engaged in manufacturing and marketing industrial alcohol, spirits, Indian-made foreign liquor, and sugar cubes, approached UTO in 1982 to explore collaboration for selling UTO’s products in India. On July 7, 1983, UTO entered into a license agreement permitting Tilaknagar to use the “Mansion House” and “Savoy Club” trademarks for alcoholic beverages like whisky, gin, brandy, and rum.

UTO alleged that Tilaknagar, with mala fide intent, applied for registration of these trademarks in India, including the “Herman Jensen” logo used by UTO’s affiliate since 1947. Claiming infringement of copyright and passing off, UTO filed a suit in the Bombay High Court, accompanied by a Notice of Motion seeking a temporary injunction to restrain Tilaknagar’s use of the trademarks. On December 22, 2011, the Single Judge rejected the injunction, prompting UTO to file Appeal No. 66 of 2012. During the appeal, a Division Bench identified conflicting precedents on the nature of injunction orders and the scope of appellate review, leading to a reference to a Larger Bench on December 15, 2014, to resolve the discord between decisions like Colgate Palmolive v. Anchor Health and Parksons Cartamundi v. Suresh Kumar.

Detailed Procedural Background: The dispute originated when UTO filed a suit for trademark infringement and passing off, along with Notice of Motion No. 993 of 2009, seeking a temporary injunction. The Single Judge’s rejection of the injunction on December 22, 2011, led to UTO’s Appeal No. 66 of 2012. Related proceedings included Cross Objection No. 3 of 2012, Notice of Motion No. 445 of 2012, Notice of Motion No. 740 of 2013, Notice of Motion No. 1427 of 2014, and Interim Application No. 2979 of 2024 by Allied Blender and Distillers Ltd., all linked to the main appeal. During the appeal’s hearing, the Division Bench noted irreconcilable views in prior Bombay High Court decisions—Colgate Palmolive (2005), Parksons Cartamundi (2012), and Goldmines Telefilms (2014)—on whether injunction orders are discretionary or adjudicatory and the extent of appellate scrutiny.

On December 15, 2014, the Division Bench referred two questions to a Larger Bench: whether Colgate Palmolive, holding injunction orders as discretionary, or Parksons Cartamundi and Goldmines Telefilms, treating them as prima facie adjudications, set out the correct law, and what is the scope of an appeal from an injunction order. The Larger Bench, comprising Chief Justice Alok Aradhe, Justices M.S. Karnik, and Shyam C. Chandak, heard arguments from counsel L.M. Jenkins for UTO, Ashish Kamat for Allied Blender, and senior advocates Ravi Kadam and Venkatesh Dhond for Tilaknagar. The judgment, reserved on April 21, 2025, and pronounced on April 28, 2025, answered the reference, directing the appeal’s listing before the appropriate bench for further orders.

The Larger Bench addressed two referred questions: Whether the decision in Colgate Palmolive v. Anchor Health, holding that a temporary injunction order is discretionary despite a finding on prima facie case, or the decisions in Parksons Cartamundi v. Suresh Kumar and Goldmines Telefilms v. Reliance Big Entertainment, treating such orders as prima facie adjudications, represents the correct legal position? What is the scope and ambit of an appeal from an order passed by a trial judge on an interlocutory injunction application pending suit disposal?

Detailed Submission of Parties: UTO Nederland argued that the Single Judge’s order denying the injunction involved a prima facie adjudication of the parties’ rights, particularly on trademark infringement and passing off. They contended that the appellate court’s scope was not limited to checking for perversity or errors apparent but extended to a comprehensive review of all aspects of the order. UTO asserted that the court could substitute the trial judge’s conclusions with its own findings, especially given allegations of trademark assignment, abandonment, or acquiescence. They relied on Hiralal Parbhudas v. Ganesh Trading to argue that adjudication, not discretion, characterized the Single Judge’s decision, necessitating broader appellate scrutiny.

Tilaknagar Industries countered that injunction decisions are discretionary, guided by the trinity test of prima facie case, balance of convenience, and irreparable injury. They argued that the Single Judge’s order was an exercise of discretion to maintain status quo, not an adjudication on merits. Tilaknagar submitted that appellate review is confined to assessing whether the discretion was exercised arbitrarily, capriciously, or perversely, or ignored settled principles, as established in Wander Ltd. v. Antox India. They contended that Hiralal Parbhudas, dealing with a statutory order under the 1958 Act, was inapplicable to CPC-based injunctions, and Parksons Cartamundi erred in relying on it. Tilaknagar cited Gujarat Bottling Co. v. Coca Cola, Shyam Sel v. Shyam Steel, and Ramakant Choksi v. Harish Choksi to reinforce the discretionary nature of injunction orders and limited appellate interference.

Detailed Discussion on Judgments Cited by Parties and Their Context: The Larger Bench analyzed a robust array of precedents to resolve the conflict and define the scope of injunction appeals:

Colgate Palmolive Company v. Anchor Health and Beauty Care Pvt. Ltd., 2005 (1) Mh.L.J. 613: Cited by the court, this Bombay High Court Division Bench decision held that a temporary injunction order remains discretionary, even if the judge finds no prima facie case, and does not involve merits adjudication. It distinguished Hiralal Parbhudas and National Chemicals, which dealt with statutory orders, as irrelevant to CPC-based injunctions. The court upheld this as the correct principle, aligning with Supreme Court precedents.

Parksons Cartamundi Pvt. Ltd. v. Suresh Kumar Jasraj Burad, 2012 SCC OnLine Bom 438: Cited by the court, this Division Bench treated an injunction order as a prima facie adjudication, relying on Hiralal Parbhudas to argue that no discretion was exercised when the judge found no deceptive similarity. The Larger Bench found this view erroneous, as it ignored Colgate Palmolive and misapplied Hiralal Parbhudas to CPC contexts.

Goldmines Telefilms Pvt. Ltd. v. Reliance Big Entertainment Pvt. Ltd., Appeal (L) No. 458/2014 in NM/452/2014 in Suit/194/2014, Bombay High Court, decided on September 24, 2014: Cited by the court, this Division Bench followed Parksons Cartamundi, treating injunction orders as adjudicatory. The Larger Bench criticized its failure to consider Colgate Palmolive and its reliance on Hiralal Parbhudas and National Chemicals, rendering it inconsistent with Supreme Court guidelines.

Hiralal Parbhudas v. Ganesh Trading Company, AIR 1984 Bom 218: Cited by UTO and Tilaknagar, this Bombay High Court decision distinguished discretion from adjudication in the context of a Registrar’s order under Section 56(1) of the 1958 Act. It held that rejecting a rectification application based on non-deceptive similarity was adjudication, not discretion. The Larger Bench clarified its irrelevance to CPC-based injunctions, limiting its applicability to statutory contexts.

Wander Ltd. v. Antox India Pvt. Ltd., 1990 Supp SCC 727: Cited by Tilaknagar and the court, this Supreme Court three-judge bench decision is a locus classicus, holding that appellate courts should not interfere with a trial court’s discretionary injunction order unless it is arbitrary, capricious, perverse, or ignores settled principles. The Larger Bench endorsed this as the guiding principle for appellate review.

Gujarat Bottling Co. Ltd. v. Coca Cola Co., (1995) 5 SCC 545: Cited by Tilaknagar, this Supreme Court case defined prima facie case as a serious question requiring trial, emphasizing the discretionary nature of injunctions based on the trinity test. The Larger Bench relied on it to affirm the discretionary framework.

Shyam Sel and Power Ltd. v. Shyam Steel Industries Ltd., (2023) 1 SCC 634: Cited by Tilaknagar, this Supreme Court decision reaffirmed Wander, limiting appellate interference to cases of perverse or arbitrary discretion. The Larger Bench used it to reinforce the restricted scope of appeal.

Ramakant Ambalal Choksi v. Harish Ambalal Choksi, 2024 SCC OnLine SC 3538: Cited by Tilaknagar, this Supreme Court case approved Wander, clarifying that appellate courts examine discretion’s propriety and may adjudicate facts within limited contours. The Larger Bench adopted its principles to define appellate scope.

American Cynamid Co. v. Ethicon Ltd., [1975] 1 All ER 504 (House of Lords): Cited by the court, this seminal UK case defined prima facie case as a serious question to be tried, avoiding merits resolution at the interlocutory stage. The Larger Bench used it to clarify the trinity test’s application.

Garden Cottage Foods Ltd. v. Milk Marketing Board, [1983] 2 All ER 770: Cited by the court, this UK case reiterated American Cynamid, emphasizing the discretionary nature of injunctions. The Larger Bench referenced it to support the trinity test framework.

Martin Burn Ltd. v. R.N. Banerjee, AIR 1958 SC 79: Cited by the court, this Supreme Court case defined prima facie case as one established if evidence is believed, not requiring proof to the hilt. The Larger Bench used it to elucidate the standard for injunction applications.

Dalpat Kumar v. Prahlad Singh, (1992) 1 SCC 719: Cited by the court, this Supreme Court case clarified that prima facie case involves a bona fide substantial question, not a title to be proved at trial. The Larger Bench relied on it to define the trinity test’s scope.

Anand Prasad Agarwal v. Tarkeshwar Prasad, (2001) 5 SCC 568: Cited by the court, this Supreme Court case reinforced that prima facie case requires a serious question, not full proof. The Larger Bench used it to support the discretionary framework.

State of Kerala v. Union of India, (2024) 7 SCC 183: Cited by the court, this Supreme Court case reiterated the prima facie case standard, aligning with Gujarat Bottling. The Larger Bench referenced it to affirm the trinity test.

Fellowes & Son v. Fisher, [1975] 2 All ER 829: Cited by the court, this UK case outlined the balance of convenience as weighing plaintiff’s and defendant’s injury risks. The Larger Bench used it to clarify the trinity test’s second prong.

Halsbury’s Laws of England, Fourth Edition, Vol. 24, para 856: Cited by the court, this legal treatise supported the balance of convenience test, emphasizing protection against uncompensated injury. The Larger Bench referenced it to frame the trinity test.

Shiv Kumar Chadha v. Municipal Corporation of Delhi, 1993 SCC (3) 161: Cited by the court, this Supreme Court case held that injunctions are discretionary, requiring the trinity test and clean hands. The Larger Bench used it to affirm the equitable nature of relief.

Seema Arshad Zaheer v. Municipal Corporation of Greater Mumbai, (2006) 5 SCC 282: Cited by the court, this Supreme Court case emphasized that injunctions require clean hands, reinforcing their discretionary nature. The Larger Bench referenced it to highlight equitable considerations.

Printers (Mysore) Pvt. Ltd. v. Pothan Joseph, (1960) 3 SCR 713, AIR 1960 SC 1156: Cited indirectly via Wander, this Supreme Court case outlined appellate restraint in discretionary orders, quoted by Gajendragadkar, J. The Larger Bench used it to support limited appellate interference.

Charles Osenton & Co. v. Johnston, [1942] AC 130 (House of Lords): Cited indirectly via Wander, this UK case, per Viscount Simon L.C., established appellate restraint unless discretion is perverse. The Larger Bench relied on it to define appellate scope.

Moffett v. Gough, (1878) 1 LR Ir 331: Cited by the court, this case defined a perverse verdict as against all evidence, supporting the Larger Bench’s criteria for appellate interference.

Godfrey v. Godfrey, 106 NW 814: Cited by the court, this US case defined “perverse” as deviating from what is right, aiding the Larger Bench’s interpretation of perversity.

Damodar Lal v. Sohan Devi, (2016) 3 SCC 78: Cited by the court, this Supreme Court case held that perversity requires a conclusion impossible on evidence, not mere inadequacy. The Larger Bench used it to clarify appellate review standards.

Government of West Bengal v. Tarun K. Roy, (2004) 1 SCC 347: Cited by the court, this Supreme Court case held that an earlier decision prevails over a conflicting later one if the former addresses the issue specifically. The Larger Bench applied this to favor Colgate Palmolive over Parksons Cartamundi and Goldmines Telefilms.

Detailed Reasoning and Analysis of Judge:  Chief Justice’s reasoning centered on resolving the conflict between Colgate Palmolive and the Parksons Cartamundi-Goldmines Telefilms line of decisions, grounding the analysis in Supreme Court precedents and common law principles. The court began by outlining the equitable roots of injunctions, which prevent future injury through discretionary relief, guided by the trinity test: prima facie case, balance of convenience, and irreparable injury. Drawing on American Cynamid and Gujarat Bottling, the court clarified that a prima facie case requires a serious question to be tried, not a merits adjudication, ensuring the trial court avoids resolving contested facts or complex legal issues prematurely.

The court then addressed the nature of injunction orders, affirming that they are discretionary, as per Wander, Shyam Sel, and Ramakant Choksi. Wander’s locus classicus status was emphasized, limiting appellate interference to cases where the trial court’s discretion is arbitrary, capricious, perverse, or ignores settled principles. The court defined perversity, citing Moffett, Godfrey, and Damodar Lal, as a conclusion impossible on evidence, not merely a different interpretation. This framework underscored that appellate courts should not substitute their discretion unless the trial court’s order is fundamentally flawed.

Examining the conflicting Bombay High Court decisions, the court upheld Colgate Palmolive, which correctly held that injunction orders remain discretionary, even if no prima facie case is found, and do not adjudicate merits. Colgate Palmolive’s reliance on Dalpat Kumar and its distinction of Hiralal Parbhudas and National Chemicals as irrelevant to CPC-based injunctions was endorsed. In contrast, Parksons Cartamundi and Goldmines Telefilms were deemed erroneous for treating injunction orders as adjudicatory, misapplying Hiralal Parbhudas (a 1958 Act case) to Order XXXIX CPC contexts, and ignoring Colgate Palmolive and Supreme Court precedents like Wander.

The court invoked Government of West Bengal v. Tarun Roy to resolve the conflict, holding that Colgate Palmolive, as the earlier decision specifically addressing injunction appeals, prevailed over the later Parksons Cartamundi and Goldmines Telefilms, which failed to engage with its principles. The distinction between statutory orders under Section 56(1) of the 1958 Act (adjudicatory, as in Hiralal Parbhudas) and CPC-based injunctions (discretionary) was pivotal, ensuring clarity in appellate scope.

On the second question, the court delineated appellate review as examining the propriety of discretion, not reassessing evidence de novo, unless the trial court’s findings are perverse or ignore the trinity test. Ramakant Choksi’s allowance for limited factual adjudication was acknowledged, but within Wander’s contours. The court’s answers reaffirmed the discretionary nature of injunction orders and a restrained appellate role, aligning with equitable and statutory frameworks.

Final Decision:  On April 28, 2025, the Bombay High Court’s Larger Bench answered the reference, holding that Colgate Palmolive correctly states the law: a temporary injunction order is discretionary, not an adjudicatory, even if no prima facie case is found. The court clarified that appellate review is limited to assessing arbitrary, capricious, or perverse discretion or disregard of settled principles, as per Wander, Shyam Sel, and Ramakant Choksi. The decisions in Parksons Cartamundi and Goldmines Telefilms were overruled as incorrect for treating injunction orders as adjudicatory. The reference was answered, and the appeal was directed to be listed before the appropriate bench for further orders.

Law Settled in This Case: The decision established several principles under the CPC and trademark law:  A temporary injunction order is an exercise of discretion, not a prima facie adjudication, even if the trial judge finds no prima facie case. The trinity test—prima facie case, balance of convenience, and irreparable injury—guides discretionary injunction decisions, with prima facie case meaning a serious question to be tried, not merits resolution.Appellate review of injunction orders is limited to examining whether the trial court’s discretion was exercised arbitrarily, capriciously, perversely, or ignored settled principles, as per Wander Ltd. v. Antox India.Perversity in an injunction order requires a conclusion impossible on evidence, not merely inadequate evidence or a different interpretation.Decisions under statutory provisions like Section 56(1) of the Trade and Merchandise Marks Act, 1958, involving adjudication, are distinct from CPC-based injunction orders, rendering cases like Hiralal Parbhudas inapplicable to the latter.When conflicting Division Bench decisions exist, the earlier decision specifically addressing the issue prevails, as per Government of West Bengal v. Tarun Roy.Appellate courts may adjudicate facts in injunction appeals but within the limited contours of assessing discretion’s propriety, not substituting their own findings unless the trial court’s order is perverse.

Case Title: UTO Nederland B.V. & Anr. Vs. Tilaknagar Industries Ltd.: Date of Order: April 28, 2025: Case No.: Appeal No. 66 of 2012: Neutral Citation: 2025:BHC-OS:7110-DB: Name of Court: High Court of Judicature at Bombay, Ordinary Original Civil Jurisdiction: Name of  Hon'ble Judge: Alok Aradhe (Chief Justice), M.S. Karnik, Shyam C. Chandak

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi

ITC Limited Vs. The Controller of Patents

Introduction:  The case of ITC Limited Vs. The Controller of Patents, Designs & Trademark represents a significant clash between intellectual property rights and public health considerations in India. At its core, the dispute revolves around the rejection of a patent application for a novel nicotine aerosol delivery device, which ITC Limited claimed was distinct from electronic nicotine delivery systems (ENDS) like e-cigarettes. The Calcutta High Court, in its judgment, grappled with issues of procedural fairness, statutory interpretation, and the balance between innovation and public policy. This case study delves into the intricate details of the case, analyzing the factual and procedural background, the arguments presented, the judicial reasoning, and the broader implications for patent law in India.

Detailed Factual Background:  ITC Limited, a prominent Indian conglomerate, filed a patent application (Indian Patent Application No. 685/KOL/2015) on June 10, 2015, for an invention titled "A Device and Method for Generating and Delivery of a Nicotine Aerosol to a User." The device was described as a non-electronic system comprising a tube with two components: one containing an aerosol-generating substance (nicotine or alkaloids) and another holding an aerosol-promoting substance (pyruvic acid). These components were arranged in a parallel configuration, and upon inhalation, a chemical reaction between the substances produced a nicotine salt-based aerosol for delivery to the user. ITC emphasized that the device did not rely on electrical or electronic heating mechanisms, distinguishing it from e-cigarettes or ENDS.

The Controller of Patents and Designs, Kolkata, rejected the application on June 26, 2023, under Section 15 of the Patents Act, 1970, citing Section 3(b), which prohibits inventions whose primary or intended use is contrary to public order, morality, or causes serious prejudice to human, animal, or plant life, health, or the environment. The Controller’s decision referenced various statutes, an Indian Council of Medical Research (ICMR) White Paper, and other documents, including a newspaper article, to argue that the device posed health risks akin to e-cigarettes. ITC challenged this rejection in the Calcutta High Court, alleging procedural irregularities and misapplication of the law.

Detailed Procedural Background: The procedural journey of the case began with ITC’s patent application in 2015. The Controller issued a First Examination Report (FER), which did not cite documents supporting an objection under Section 3(b). Subsequently, a hearing notice dated May 1, 2023, introduced new documents, including an online newspaper article and references to the ICMR White Paper on ENDS dated May 29, 2019. ITC participated in a hearing on May 30, 2023, and submitted a reply on June 14, 2023. However, the Assistant Controller’s order on June 26, 2023, relied on additional documents and statutes not previously disclosed, including the Prohibition of Electronic Cigarettes Act, 2019, and various environmental and drug-related laws.

ITC appealed the rejection under Section 117A of the Patents Act, 1970, before the Calcutta High Court’s Commercial Division. The appeal, heard by Justice Krishna Rao, concluded on April 8, 2025, with the judgment delivered on April 30, 2025. ITC argued that the Controller’s reliance on undisclosed documents violated principles of natural justice, while the Controller defended the rejection, asserting that the device’s nicotine content exceeded permissible limits and posed public health risks.

The case raised several critical issues:  First, whether the Controller’s reliance on documents not disclosed to ITC during the examination process violated principles of natural justice? Second, whether the invention fell within the scope of Section 3(b) of the Patents Act, 1970, as an invention causing serious prejudice to human health? Third, whether the Controller’s classification of the device as an e-cigarette or ENDS was justified, given ITC’s claim of a non-electronic chemical reaction-based mechanism?

ITC Limited’s Submissions:  ITC argued that the device was a novel, non-electronic invention that generated nicotine aerosol through a chemical reaction, not electrical heating, distinguishing it from e-cigarettes or ENDS. It emphasized the device’s parallel configuration of nicotine (60-90 microliters) and pyruvic acid (120-140 microliters), delivering 0-15 micrograms of nicotine per puff, which he claimed was within safe limits. It contended that the Controller’s reliance on Section 3(b) was misplaced, as the provision required proof of “serious prejudice” tied to the invention’s primary or intended use, not speculative health risks.

It highlighted procedural lapses, arguing that the Controller introduced new documents, including the ICMR White Paper and various statutes, without providing ITC an opportunity to respond, violating natural justice. He cited Ssangyong Engineering and Construction Company Limited vs. National Highways Authority of India (2019 SCC OnLine SC 677), where the Supreme Court set aside an arbitral award for relying on undisclosed evidence, as analogous to the Controller’s actions.

It further argued that the Controller’s reliance on the Prohibition of Electronic Cigarettes Act, 2019, was erroneous, as the device was not an e-cigarette. He referenced a presentation by Shri DPS Parmar, former Deputy Controller, which excluded tobacco-related inventions from Section 3(b) examples, and cited Balsinor Nagrik Co-op. Bank Ltd. vs. Babubhai S. Pandya (AIR 1987 SC 849) to argue that statutory provisions must be read holistically. He also invoked Article 27(2) of the TRIPS Agreement and Article 4quarter of the Paris Convention, asserting that patentability should not be denied merely due to domestic sales restrictions. Finally, he cited Manganese Ore (India) Ltd. vs. Regional Asstt. CST ((1976) 4 SCC 124) to argue that the Controller’s inconsistent treatment of tobacco-related patents was arbitrary.

Controller’s Submissions: Controller argued that the device fell under Nicotine Replacement Therapy (NRT), which was not approved under the Drugs and Cosmetics Act, 1940, for the claimed nicotine levels (60-90 mg per tube). Chakraborty asserted that nicotine, even in therapeutic use, posed health risks, particularly to the lungs and cardiovascular system, and cited the ICMR White Paper to link ENDS, vapes, and NRT to nicotine addiction and lung diseases. He argued that the device’s aerosol delivery mechanism was akin to e-cigarettes, falling under Section 3(b) due to its potential to promote addiction.

He defended the procedural fairness, noting that ITC received a hearing notice on May 1, 2023, attended the hearing, and submitted a reply. He claimed the relied-upon documents were publicly available on government websites, and the ICMR White Paper was referenced in the hearing notice. He cited Article 47 of the Constitution, which mandates the State to improve public health, to justify the rejection. He also relied on Basawaraj and Another vs. Special Land Acquisition Officer ((2013) 14 SCC 81) and Fuljit Kaur vs. State of Punjab and Others ((2010) 11 SCC 455) to argue that prior erroneous grants of patents did not confer a right to similar relief.

Detailed Discussion on Judgments Cited by Parties: 

Ssangyong Engineering and Construction Company Limited vs. National Highways Authority of India (2019 SCC OnLine SC 677):  ITC cited this case to argue that the Controller’s reliance on undisclosed documents violated natural justice. The Supreme Court held that an arbitral tribunal’s use of government guidelines not in evidence prejudiced the appellant’s ability to present its case, warranting the award’s annulment under Section 34(2)(a)(iii) of the Arbitration and Conciliation Act, 1996. The Calcutta High Court found this precedent persuasive, noting that ITC was similarly denied an opportunity to address the Controller’s cited statutes and documents.

Balsinor Nagrik Co-op. Bank Ltd. vs. Babubhai S. Pandya (AIR 1987 SC 849):  ITC relied on this case to argue that Section 3(b)’s “serious prejudice” must be read with “primary or intended use.” The Supreme Court emphasized holistic statutory interpretation, which ITC used to contend that the Controller misapplied Section 3(b) by focusing on potential health effects rather than the device’s intended purpose. The High Court indirectly endorsed this by questioning the Controller’s broad application of Section 3(b).

Manganese Ore (India) Ltd. vs. Regional Asstt. CST ((1976) 4 SCC 124): ITC cited this case to highlight the Controller’s arbitrary rejection, given prior grants of tobacco-related patents. The Supreme Court held that administrative actions must be consistent to avoid arbitrariness under Article 14. The High Court acknowledged this argument but focused primarily on procedural fairness.

Basawaraj and Another vs. Special Land Acquisition Officer ((2013) 14 SCC 81): The Controller cited this case to argue that prior erroneous patent grants did not entitle ITC to similar relief. The Supreme Court clarified that Article 14 does not perpetuate illegality. The High Court did not directly engage with this precedent, prioritizing procedural issues.

Fuljit Kaur vs. State of Punjab and Others ((2010) 11 SCC 455): The Controller used this case to reinforce that mistaken relief in other cases does not confer legal rights. The Supreme Court held that equality under Article 14 cannot justify extending erroneous decisions. The High Court’s focus on natural justice rendered this argument secondary.

Detailed Reasoning and Analysis of Judge: Court’s reasoning centered on procedural fairness and the misapplication of Section 3(b). The Court found that the Controller’s reliance on undisclosed documents, including the ICMR White Paper, various statutes, and a newspaper article, violated natural justice. Citing Ssangyong Engineering, the Court held that ITC was prejudiced by its inability to address these materials, which were not referenced in the FER or hearing notice. The Court noted that the Controller’s claim of public availability did not excuse the failure to provide ITC an opportunity to respond.

On the substantive issue, the Court scrutinized the Controller’s classification of the device as an e-cigarette or ENDS. It highlighted ITC’s claim that the device used a chemical reaction, not electrical heating, and noted that the Controller’s reliance on the Prohibition of Electronic Cigarettes Act, 2019, was not raised in the hearing notice, denying ITC a chance to rebut. The Court also examined Section 3(b), referencing Shri DPS Parmar’s presentation, which excluded tobacco-related inventions from typical Section 3(b) exclusions like gambling machines or biological warfare devices. This suggested that the Controller’s application of “serious prejudice” was overly broad.

The Court further considered international obligations under Article 27(2) of the TRIPS Agreement and Article 4 quarter of the Paris Convention, which discourage patent denials based solely on domestic sales restrictions. It also noted Section 83(d) and (e) of the Patents Act, which distinguish patent grants from commercial exploitation, reinforcing that patentability should not hinge on public health policy alone. While acknowledging the Controller’s public health concerns under Article 47, the Court prioritized procedural fairness and remanded the case for fresh consideration.

Final Decision: The Calcutta High Court allowed ITC’s appeal (IPDPTA No. 121 of 2023) on April 30, 2025, setting aside the Controller’s order dated June 26, 2023. The matter was remanded to the Controller for fresh consideration within six months by a different officer, with instructions to decide without influence from the Court’s observations.

Law Settled in the Case:  The case clarified that patent examination processes must adhere to principles of natural justice, requiring controllers to disclose all relied-upon documents to applicants for a fair opportunity to respond. It also underscored that Section 3(b) of the Patents Act, 1970, should be applied narrowly, focusing on an invention’s primary or intended use, not speculative health risks. The judgment reinforced that patent grants are distinct from commercial exploitation, aligning with TRIPS and Paris Convention principles, and highlighted the need for consistent application of patent law to avoid arbitrariness.

Case Title:ITC Limited Vs. The Controller of Patents: Date of Order:April 30, 2025: Case No.IPDPTA No. 121 of 2023: Name of Court:High Court at Calcutta: Name of Hon'ble Judge:Justice Krishna Rao

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi

Annikki GmbH Vs Assistant Controller of Patents and Designs

Combining processes from multiple prior arts does not constitute a “known process” under Section 3 d of Patent Act unless previously integrated

Introduction: In the intricate world of intellectual property, patent disputes often hinge on the delicate balance between innovation and prior art. The case of Annikki GmbH v. Assistant Controller of Patents and Designs, adjudicated by the Madras High Court, exemplifies this tension. Annikki GmbH, an Austrian company, sought to overturn the rejection of its patent application for a novel non-fermentative process to produce xylitol from lignocellulosic material. The appeal, filed under Section 117-A of the Patents Act, 1970, challenged the Assistant Controller’s order dated 10.12.2019, which dismissed the application on grounds of lacking novelty, inventive step, and falling under the exclusionary provisions of Section 3(d). This case study delves into the factual and procedural intricacies, the legal issues at play, the arguments of the parties, the judicial reasoning, and the broader implications of the court’s decision, offering a comprehensive analysis of a pivotal moment in patent law adjudication.

Detailed Factual Background:Annikki GmbH, based in Graz, Austria, filed Indian Patent Application No. 467/CHENP/2012, titled “Process for the Production of Carbohydrate Cleavage Products from a Lignocellulosic Material.” The invention proposed a non-fermentative method to produce xylitol, a valuable sugar alcohol, from lignocellulosic material. Unlike traditional fermentative processes, Annikki’s method emphasized high selectivity in lignin degradation, reduced enzyme costs, and limited energy expenditure. The process utilized alcohol and treated lignin as a valuable byproduct rather than a mere energy source for fermentation, marking a significant departure from conventional techniques. 

The complete specification highlighted these advantages, particularly on internal pages 5 and 7, underscoring the technical and economic benefits of the invention. However, the Assistant Controller of Patents and Designs rejected the application, citing prior art documents (D1 to D6) that allegedly rendered the invention obvious and lacking inventive step. The rejection also invoked Section 3(d) of the Patents Act, claiming the process was a mere combination of known processes without enhanced efficacy.

Detailed Procedural Background:The procedural journey of the patent application began with the issuance of the First Examination Report (FER) on 30.11.2017, which raised objections based on lack of novelty and inventive step, referencing prior art documents D1 to D6. Annikki responded on 28.05.2018, submitting amended claims to address the objections. A hearing notice dated 31.05.2018 maintained the FER’s objections, leading to a hearing on 13.07.2018. Post-hearing, Annikki filed written submissions on 09.08.2018. Despite these efforts, the Assistant Controller issued the impugned order on 10.12.2019, rejecting the application. 

The order relied heavily on prior art D5, which was interpreted as disclosing a non-fermentative process, and combined elements from D1 to D4 to argue that the invention lacked inventiveness and was barred under Section 3(d). Aggrieved, Annikki filed a Transferred Civil Miscellaneous Appeal (T)CMA(PT) No. 70 of 2023 before the Madras High Court, seeking to quash the order and secure the grant of the patent.

Issues Involved in the Case:The case presented several critical legal issues for adjudication. First, did the Assistant Controller err in concluding that the invention lacked novelty and inventive step based on prior art documents D1 to D6? Second, was the rejection under Section 3(d) of the Patents Act, which excludes the mere use of a known process unless it results in a new product or employs a new reactant, legally sustainable?  Third, did the Assistant Controller adequately consider Annikki’s responses to the FER and the hearing submissions, or were the reasons in the impugned order inconsistent with prior objections?   Finally, did the non-fermentative nature of Annikki’s process constitute a technical advancement over the cited prior art, warranting patent protection? These issues required a meticulous examination of the prior art, the statutory framework, and the procedural fairness of the patent examination process.

Detailed Submission of Parties:Annikki’s  presented a robust defense of the invention’s patentability. They argued that the invention’s non-fermentative process for xylitol production was novel and inventive, as it avoided fermentation, reduced enzyme costs, and enhanced lignin utilization. Referencing the complete specification, they highlighted the process’s high selectivity and energy efficiency. Addressing prior art D5, they contended that the Assistant Controller misconstrued it as non-fermentative, pointing to Figure 3 and column 7 of D5, which clearly described a fermentative process. For D1, titled “Selective Solvent Delignification for Fermentation Enhancement,” they noted its explicit reliance on fermentation, with lignin used as an energy source, as evidenced by Table 3. D2 was dismissed as irrelevant due to its alkali treatment, distinct from Annikki’s method. D3 was argued to operate at significantly higher temperatures, and D4 was criticized for involving fermentation in its fourth step. Annikki further alleged procedural lapses, asserting that the Assistant Controller ignored their FER response and raised new objections in the impugned order without prior notice. They supported their claim of technical advancement with a declaration from Mr. Mag. Ortwin Ertl, the co-inventor and CEO, which included experimental data not previously submitted due to the absence of specific objections.

Detailed Discussion on Judgments and Citations: The court’s analysis referenced one key precedent, Novozymes v. Assistant Controller of Patents & Designs (2023:MHC:4261), to interpret Section 3(d) of the Patents Act. In Novozymes, the Madras High Court elucidated that Section 3(d) comprises three limbs, with the third limb excluding the “mere use of a known process” unless it results in a new product or employs a new reactant. The court applied this interpretation to scrutinize the Assistant Controller’s reliance on Section 3(d). Annikki’s  cited Novozymes to argue that combining processes from multiple prior arts (D1 to D5) did not constitute a “known process” under Section 3(d), as the exclusion applies only to a single known process. 

Detailed Reasoning and Analysis of Judge:The Court meticulously dissected the Assistant Controller’s order, identifying multiple errors in law and fact. On Section 3(d), the court found the Assistant Controller’s conclusion unsustainable. The impugned order’s assertion that Annikki’s process was a mere combination of known processes from D1 to D5 was flawed, as Section 3(d)’s third limb applies to a single known process. The court reasoned that combining distinct processes from multiple prior arts did not qualify as a “known process” unless previously integrated, rendering the objection legally invalid. This analysis leaned heavily on the Novozymes precedent, which clarified the scope of Section 3(d)’s exclusions.Regarding the inventive step, the court scrutinized the Assistant Controller’s reliance on D5, which was erroneously interpreted as disclosing a non-fermentative process. The court examined paragraph 3 of column 7 and Figure 3 of D5, confirming that D5 involved fermentation, contrary to the impugned order’s findings. This misinterpretation undermined the objection of obviousness. The court also criticized the Assistant Controller’s reliance on “common general knowledge” to assert that enzyme-based xylose degradation was obvious, noting the absence of cited sources or materials to substantiate this claim. For D2, the court found the Assistant Controller’s conclusion that it was analogous art illogical, given its focus on ethanol production rather than xylitol, and the lack of explanation for its relevance.The court further addressed procedural irregularities, noting that the Assistant Controller failed to consider Annikki’s FER response and introduced new objections in the impugned order without prior notice. This lack of fairness necessitated judicial intervention. Annikki’s submission of Mr. Ertl’s declaration, which included experimental data supporting the non-fermentative process’s technical advantages, was deemed significant. Since this evidence was not presented earlier due to the absence of specific objections, the court found it an additional reason for remanding the matter.

Final Decision:The Madras High Court set aside the impugned order dated 10.12.2019 and remanded the matter to the Patent Office for reconsideration. The court stipulated that a different officer, not the one who issued the original order, should conduct the review to avoid bias. The Patent Office was directed to provide Annikki a reasonable opportunity to present its case and issue a reasoned decision within four months. The court refrained from opining on the patent application’s merits, ensuring an impartial re-evaluation. The appeal was disposed of without costs.

Law Settled in This Case:This case clarified the application of Section 3(d) of the Patents Act, particularly its third limb, which excludes the “mere use of a known process.” The court established that combining processes from multiple prior arts does not constitute a “known process” under Section 3(d) unless previously integrated, preventing overbroad rejections of patent applications. It also underscored the importance of procedural fairness in patent examinations, requiring controllers to consider applicants’ responses and provide consistent objections. Additionally, the judgment reinforced the need for evidence-based conclusions when asserting obviousness or relying on common general knowledge, setting a higher standard for patent office determinations.

Case Title: Annikki GmbH Vs Assistant Controller of Patents and Designs: Date of Order: 24.04.2025: Case No.: (T)CMA(PT) No. 70 of 2023 (OA/19/2020/PT/CHN): Name of Court: High Court Madras: Name of Judge: Senthilkumar Ramamoorthy J.

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi

Surya Food and Agro Limited Vs. Om Traders

Unveiling the Clash of Jurisprudence: Adversarial Vs. Inquisitorial 

Introduction: The Indian legal system, rooted in the common law tradition, operates predominantly on an adversarial model where the court acts as a neutral arbiter, adjudicating disputes based on the evidence and arguments presented by the parties. However, the case of Surya Food and Agro Limited v. Om Traders, adjudicated by the Delhi High Court, brings to the forefront a critical tension between adversarial and inquisitorial approaches to jurisprudence. This case, centered on allegations of copyright infringement and passing off concerning the packaging of biscuit products, highlights the procedural intricacies of commercial disputes and the judiciary’s role in ensuring fairness. The court’s decision to set aside a summary judgment rendered by a Single Judge underscores the importance of adhering to adversarial principles, particularly in the context of commercial litigation governed by the Commercial Courts Act, 2015. This article delves into the factual and procedural nuances of the case, the legal issues at play, the parties’ submissions, the judicial reasoning, and the broader implications for the interplay between adversarial and inquisitorial jurisprudence.

Detailed Factual Background: Surya Food and Agro Limited, a company incorporated in 1992, is a prominent manufacturer of cookies, cakes, confectioneries, juices, and beverages, owning several trademarks, including “Butter Bite,” “Italiano,” and “Butter Delite.” The dispute revolves around its product “Butter Delite,” launched in October 2015 with distinctive packaging claimed to be an artistic work under the Copyright Act, 1957. This packaging was designed by Mr. Sachin More of Oberoi IBC India Pvt. Ltd. in August 2015 and assigned to Surya Food via a deed dated 10 August 2015. The packaging was later registered under the Copyright Act (Registration No. A-132116 of 2019) and as a trademark (Registration No. 4329956 in Class 30). Surya Food asserted that the packaging’s trade dress, characterized by its red color scheme and layout, had become synonymous with “Butter Delite” due to extensive use and sales, evidenced by annual figures: INR 7.18 crores (2015-16), INR 53.12 crores (2016-17), INR 120.07 crores (2017-18), and INR 83.40 crores (up to 30 November 2018).

In December 2018, Surya Food discovered that Om Traders, a retailer, was selling biscuits under the brand “Butter Krunch,” manufactured by Raja Udyog Private Limited, in packaging allegedly similar to “Butter Delite.” Surya Food claimed that the respondents had copied the artwork, color scheme, and placement of elements, constituting copyright infringement and passing off. The company argued that the similarities in packaging could deceive consumers, leveraging the goodwill of “Butter Delite.” The respondents, however, maintained that their packaging was distinct and that the elements cited by Surya Food were generic to the biscuit industry.

Detailed Procedural Background: Surya Food filed a suit, CS(COMM) 10/2019, before the Delhi High Court, seeking a permanent injunction, damages, and rendition of accounts against Om Traders and Raja Udyog. On 7 January 2019, summons were issued, but Surya Food’s request for an ex parte interim injunction was denied. On 26 February 2019, Raja Udyog appeared, seeking time to file a written statement and respond to Surya Food’s application for interim relief under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure (CPC). Om Traders did not appear, and on 25 March 2019, the Single Judge proceeded ex parte against them. The following day, 26 March 2019, the Single Judge heard arguments, ostensibly on the interim relief application, but clarified that the suit could be disposed of based on pleadings and admitted documents unless evidence was deemed necessary. Without framing issues or allowing evidence, the Single Judge dismissed the suit, finding the packaging of “Butter Delite” generic and not entitled to protection.

Aggrieved, Surya Food filed an intra-court appeal, RFA(OS)(COMM) 28/2019, challenging the procedural propriety of the Single Judge’s summary disposal. The Division Bench, comprising Justices Vibhu Bakhru and Amit Mahajan, examined whether the Single Judge’s approach adhered to the procedural mandates of the CPC, particularly Order XIII-A, and the Delhi High Court (Original Side) Rules, 2018.

Issues Involved in the Case: The case raised several critical issues. First, whether the Single Judge was justified in rendering a summary judgment without an application under Order XIII-A of the CPC, which governs summary judgments in commercial disputes? Second, whether the Single Judge’s reliance on personal impressions and unpleaded facts violated adversarial principles? Third, whether the provisions of Chapter X-A of the 2018 Rules, allowing suo motu summary judgments, conflicted with Order XIII-A of the CPC. Fourth, whether the packaging of “Butter Delite” was distinctive or generic, warranting protection against infringement and passing off. The core issue, however, was the balance between adversarial and inquisitorial approaches, as the Single Judge’s proactive findings suggested an inquisitorial stance, bypassing the parties’ pleaded case.

Detailed Submission of Parties: Surya Food argued that the Single Judge erred in dismissing the suit without framing issues or permitting evidence, contravening the adversarial framework mandated by the CPC. They contended that Order XIII-A requires a formal application for summary judgment, with a structured procedure ensuring both parties’ participation, including 30 days’ notice and the opportunity to file a reply. Surya Food emphasized that the Single Judge’s findings—such as the packaging being generic or biscuits targeting children—were based on impressions, not evidence or pleadings. They highlighted their substantial sales and registered intellectual property rights, asserting that the similarities in packaging warranted a trial to assess deceptive similarity and consumer confusion.

The respondents argued that the Single Judge’s decision was within the court’s jurisdiction under Chapter X-A of the 2018 Rules, which permits suo motu summary judgments. They contended that the packaging of “Butter Krunch” was distinct, bearing the prominent “Raja” trademark, unlike Surya Food’s “Priya Gold.” They argued that the red color and rectangular shape were common in the biscuit industry, negating claims of distinctiveness. The respondents further submitted that the case management hearing under Order XV-A allowed the court to dispose of the suit summarily, aligning with the Commercial Courts Act’s objective of expeditious resolution.

Detailed Discussion on Judgments and Citations: The Division Bench extensively analyzed the Single Judge’s approach, referencing several precedents to underscore the procedural and jurisprudential issues. The Single Judge had relied on foreign judgments to support the finding that the packaging was generic. In The Paddington Corporation v. Attiki Importers & Distributors, Inc., 996 F.2d 577 (2d Cir. 1993), the U.S. Second Circuit held that trade dress common to an industry is generic and not inherently distinctive. Similarly, in Fun-Damental Too, Ltd. v. Gemmy Industries Corp., 111 F.3d 993 (2d Cir. 1997), the court reiterated that industry-standard packaging lacks protectable distinctiveness. The Single Judge also cited Keebler Company v. Nabisco Brands, Inc., 1992 U.S. Dist. LEXIS 6826, noting that similar colors are common in the cookie market, making exclusive claims over a color untenable. Additionally, Colgate Palmolive Company Limited v. Patel & Anr., 2005 SCC OnLine Del 1439, was referenced to assert that no party can claim a monopoly over a color.

The Division Bench, however, focused on procedural propriety, drawing heavily from Bright Enterprises Private Limited & Anr. v. MJ Bizcraft LLP & Anr., 2017 SCC OnLine Del 6394. This case emphasized that Order XIII-A mandates a formal application and adherence to a prescribed procedure, including notice and opportunity for response, to ensure fairness. The court in Bright Enterprises held that summary judgments are exceptional and require scrupulous compliance with procedural safeguards to avoid injustice. The Division Bench also cited HPL (India) Ltd. & Ors. v. QRG Enterprises & Anr., 2017 SCC OnLine Del 6955, and Indian Style Wrestling Association of India & Anr. v. Wrestling Federation of India, 2019 SCC OnLine Del 9902, to affirm that the Commercial Courts Act prevails over conflicting High Court rules, reinforcing the primacy of Order XIII-A.

The respondents’ reliance on Chapter X-A of the 2018 Rules was countered by the Division Bench’s reference to G.P. Stewart v. Brojendra Kishore Roy Choudhury, 1939 SCC OnLine Cal 116, which clarified that repugnancy between laws need not be direct but can arise when one provision nullifies another’s effect. The court found that Rule 1 of Chapter X-A, allowing suo motu summary judgments, conflicted with Order XIII-A’s requirement of a party-initiated application, undermining the adversarial process.

Detailed Reasoning and Analysis of Judge: The Division Bench, in a judgment meticulously dissected the Single Judge’s approach, highlighting its deviation from adversarial norms. The court noted that the Single Judge’s decision to dispose of the suit summarily, without an application under Order XIII-A, violated the procedural framework established by the Commercial Courts Act. Order XIII-A, inserted via Section 16 of the Act, enables summary judgments only upon a party’s application, with clear stipulations for notice, reply, and evidence. The Single Judge’s failure to follow this procedure, coupled with the absence of framed issues or evidence, rendered the judgment procedurally infirm.

The court further criticized the Single Judge’s reliance on personal recollections, such as the red packaging of “Britannia Tiger Biscuits” and “Britannia Vita Marie Gold,” which were not part of the record. This approach, the Division Bench held, transformed the court into a witness, violating the adversarial principle that judges adjudicate based on pleaded facts and evidence. The Single Judge’s findings that the packaging was generic, that biscuits target children, and that red is a common color were speculative, lacking evidentiary support or alignment with the respondents’ defense.

On the conflict between Chapter X-A of the 2018 Rules and Order XIII-A, the court reasoned that the Commercial Courts Act, as a special enactment, prevails over High Court rules. Section 16(3) explicitly states that CPC provisions amended by the Act override conflicting High Court rules. The court rejected the respondents’ argument that Chapter X-A’s suo motu power could coexist with Order XIII-A, noting that the latter’s structured procedure ensures natural justice, which a suo motu judgment bypasses. The absence of a comparable procedure in Chapter X-A further underscored the conflict, as it left parties without adequate opportunity to contest the court’s initiative.

The Division Bench also addressed the substantive merits briefly, noting that Surya Food’s claims of deceptive similarity and consumer confusion warranted a trial. The packaging’s color scheme, size, and element placement raised triable issues, which the Single Judge prematurely dismissed by deeming them generic. The court emphasized that such findings required evidence, particularly given the respondents’ denial of similarity and the ex parte status of Om Traders.

Final Decision: The Division Bench allowed the appeal, set aside the Single Judge’s judgment dated 26 March 2019, and restored the suit, CS(COMM) 10/2019, to its position as of that date. The Registry was directed to list the suit before the concerned Roster Bench on 30 January 2023 for further proceedings, ensuring adherence to adversarial procedures, including issue framing and evidence.

Law Settled in This Case: This case settles significant procedural and jurisprudential principles in commercial litigation. It establishes that courts cannot render suo motu summary judgments in commercial disputes under Order XIII-A of the CPC, which requires a party-initiated application and strict procedural compliance. The decision reinforces the primacy of the Commercial Courts Act over conflicting High Court rules, particularly Chapter X-A of the 2018 Rules. It underscores the adversarial nature of civil proceedings, prohibiting judges from relying on personal impressions or unpleaded facts. The case also highlights the necessity of a trial when triable issues, such as deceptive similarity in trade dress, are raised, ensuring parties’ rights to present evidence and contest claims.

Case Title: Surya Food and Agro Limited Vs. Om Traders and Anr.: Date of Order: 20 January 2023: Case No.: RFA(OS)(COMM) 28/2019 : Neutral Citation: 2023/DHC/000445: Name of Court: High Court of Delhi: Name of Hon'ble Judges: Hon’ble Mr. Justice Vibhu Bakhru and Hon’ble Mr. Justice Amit Mahajan

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi

Ustad Faiyaz Wasifuddin Dagar Vs A.R. Rahman

Introduction: The case of Ustad Faiyaz Wasifuddin Dagar versus A.R. Rahman and others, adjudicated by the High Court of Delhi, represents a significant exploration of copyright law in the context of Hindustani classical music. This legal battle centers on the alleged infringement of a Dhrupad composition, "Shiva Stuti," by the song "Veera Raja Veera" in the film Ponniyin Selvan - 2. The plaintiff, a torchbearer of the Dagarvani Gharana, sought recognition of the moral and copyright rights of the Junior Dagar Brothers, claiming their original work was unlawfully used. This case study delves into the intricate details of the dispute, analyzing the factual background, procedural developments, legal issues, arguments, judicial reasoning, and the final decision, while highlighting the broader implications for copyright protection in traditional music.

Detailed Factual Background: Ustad Faiyaz Wasifuddin Dagar, the plaintiff, is a distinguished Dhrupad vocalist and a scion of the Dagarvani Gharana, a lineage spanning 20 generations of Hindustani classical musicians. He is the son of Late Ustad N. Faiyazuddin Dagar and nephew of Late Ustad Zahiruddin Dagar, collectively known as the Junior Dagar Brothers. The suit composition, "Shiva Stuti," is a Dhrupad piece composed in Raga Adana and Sultaal (a 10-beat rhythmic cycle), paying homage to Lord Shiva. The plaintiff asserts that this composition, created by the Junior Dagar Brothers in the 1970s, is an original work entitled to copyright protection. It was performed internationally, notably at the Royal Tropical Institute in Amsterdam in 1978, and later featured in the album Shiva Mahadeva by the Dagar Brothers, released by PAN Records.

The defendants include A.R. Rahman (Defendant No. 1), a globally acclaimed music composer who scored the music for Ponniyin Selvan - 2 (PS-2), where the impugned song "Veera Raja Veera" appears. Madras Talkies (Defendant No. 2) and Lyca Productions Private Limited (Defendant No. 3) are co-producers of the film, directed by Mani Ratnam. Tips Industries Limited (Defendant No. 4) holds the rights to the film’s audio and audio-visual content. Defendants No. 5 and 6, Shivam Bharadwaj and Arman Ali Dehlvi, are singers of the impugned song and former disciples of the plaintiff. The plaintiff alleges that Defendants No. 5 and 6 shared "Shiva Stuti" with A.R. Rahman without authorization, leading to its incorporation into "Veera Raja Veera."

The controversy surfaced when the audio of "Veera Raja Veera" was released on March 28, 2023, followed by its audio-visual version on YouTube on April 8, 2023. The song was credited as a "Composition based on a Dagarvani Tradition Dhrupad," but initially omitted specific reference to "Shiva Stuti" or the Junior Dagar Brothers. The plaintiff, upon discovering this, contacted A.R. Rahman on April 13, 2023, alleging infringement of the moral and copyright rights in "Shiva Stuti." Despite assurances from Rahman, no resolution was reached, prompting a legal notice on April 20, 2023. Madras Talkies responded on April 24, 2023, denying the plaintiff’s claims. The film PS-2 was released in theaters on April 28, 2023, and subsequently on Amazon Prime, intensifying the dispute. The plaintiff filed the suit seeking injunctions and recognition of the Junior Dagar Brothers’ authorship, alongside an interim application (I.A. 21148/2023) for immediate relief.

Detailed Procedural Background: The suit, registered as CS(COMM) 773/2023, was first listed before the High Court of Delhi on October 20, 2023. The court issued summons to the defendants and notice in the interim application, I.A. 21148/2023. During this hearing, the plaintiff’s counsel, relying on a notation chart, argued that while the lyrics of "Veera Raja Veera" differed, its taal and musical composition mirrored "Shiva Stuti" in Raga Adana. The court played both compositions in open court and issued ad-interim directions, requiring A.R. Rahman to produce the raw recording of "Veera Raja Veera" and correct a typographical error in the YouTube credits (from "Dargavani" to "Dagarvani") within 48 hours.

On November 10, 2023, the court rejected an intervention application by Pandit Abhishek Kumar Mishra, deeming it irrelevant to the dispute. On March 5, 2024, the court proposed expediting the suit’s final adjudication with limited witness evidence, subject to a monetary deposit, but the parties did not agree, and the interim application proceedings continued. The court permitted the parties to submit audio and audio-visual recordings of the compositions and related works. Extensive hearings followed, with arguments concluding on February 6, 2025. The judgment, reserved on that date, was pronounced on April 25, 2025, addressing the interim relief sought by the plaintiff.

Issues Involved in the Case: The court framed three primary issues for consideration in the interim application:  Originality of the Suit Composition: Whether "Shiva Stuti" is an original musical work of the Junior Dagar Brothers, entitled to copyright protection? Infringement by the Impugned Song: Whether "Veera Raja Veera" infringes the plaintiff’s copyright in "Shiva Stuti."?

Plaintiff’s Submissions: The plaintiff emphasized the Dagarvani Gharana’s legacy and the plaintiff’s credentials as a Padma Shri awardee. They argued that "Shiva Stuti," composed by the Junior Dagar Brothers in the 1970s, is an original work, as evidenced by its performance in Amsterdam and inclusion in the Shiva Mahadeva album. The plaintiff asserted that the composition’s unique arrangement of swaras (notes) in Raga Adana, combined with its taal and syncopation, distinguished it as a protectable musical work under Section 2(p) of the Copyright Act, 1957.

The plaintiff contended that "Veera Raja Veera" replicated the musical structure of "Shiva Stuti," particularly in its asthayi (main section), as demonstrated by a notation chart comparing the two works. While acknowledging that Raga Adana and the Dagarvani style are not copyrightable, the plaintiff argued that the specific arrangement of notes, their dragging, and transitions between Aroha and Avroha constituted original expression. The plaintiff cited Ram Sampath v. Rajesh Roshan (2008 SCC OnLine Bom 370) to argue that even copying a small but vital part of a composition constitutes infringement, and Sulamangalam R. Jayalakshmi v. Meta Musicals (2000 SCC OnLine Mad 381) to emphasize protection against unauthorized use.

The plaintiff further alleged that Defendants No. 5 and 6, as his disciples, shared "Shiva Stuti" with A.R. Rahman without permission, and Rahman’s acknowledgment of Dagarvani inspiration was insufficient without crediting the Junior Dagar Brothers. The plaintiff sought interim relief, including a mandatory injunction to remove the infringing portion, a monetary deposit, or proper credit acknowledgment, arguing that ongoing dissemination of the song on various platforms necessitated urgent protection of moral and copyright rights.

Defendants’ Submissions A.R. Rahman’s counsel argued that the plaintiff failed to prove the originality of "Shiva Stuti." He contended that Dhrupad, rooted in the Samaveda and governed by strict compositional rules, leaves minimal room for copyrightable elements. The suit composition, being in Raga Adana, adhered to traditional patterns, and the plaintiff did not specify which elements were original. Sibal cited Raga Parichay by Harishchandra Shrivastava to show that the swaras in "Shiva Stuti" were standard to Raga Adana, also appearing in other ragas like Darbari Kanada and Jaunpuri, and in Amir Khusro’s 13th-century composition "Yaar-e-man Biya Biya."

The defendants argued that "Shiva Stuti" was a traditional composition, as evidenced by similar renditions by other artists, including the Gundecha Brothers and Pandit Uday Bhawalkar, none of whom were covered by the plaintiff’s alleged family settlement. They challenged the plaintiff’s shifting stance on ownership, from sole owner to co-owner, and the lack of evidence supporting the Junior Dagar Brothers’ authorship. On infringement, the defendants asserted that "Veera Raja Veera" was an original work blending Western and Indian musical elements, distinct from "Shiva Stuti." They relied on Marcus Gray v. Katheryn Elizabeth Hudson (28 F.4th 87, 9th Cir. 2022) to argue that commonplace musical elements are not copyrightable, and Apple Computer Inc. v. Microsoft Corporation (35 F.3d 1435, 9th Cir. 1994) and R.G. Anand v. Delux Films ((1978) 4 SCC 118) to caution against monopolizing traditional music.

The defendants distinguished the plaintiff’s cited cases, noting that in Sulamangalam R. Jayalakshmi, the defendant used the plaintiff’s photographs, and in Ram Sampath, the plaintiff’s authorship was undisputed and supported by expert evidence, unlike the present case. They argued that granting relief would stifle creativity in Hindustani and Carnatic music, and the plaintiff’s delay in filing the suit after the film’s release weakened the case for interim relief.

Other Defendants’ Submissions: Counsel for Defendants No. 2 and 3  expressed willingness for amicable resolution but maintained that the composition was provided by A.R. Rahman, and they relied on his assertions of originality. Defendant No. 4 (Tips Industries) echoed the lack of originality in "Shiva Stuti," arguing that the Dagarvani style was not copyrightable. Defendants No. 5 and 6, the singers, did not make distinct submissions, but their role as the plaintiff’s disciples was noted as facilitating access to the suit composition.

Intervenor’s Submission:  The intervenor, Pandit Abhishek Kumar Mishra, sought to assist the court but was denied intervention, as the suit was not a public interest litigation. The court permitted written submissions on legal issues, though these did not significantly influence the judgment.

The parties relied on several judicial precedents to bolster their arguments, each applied in specific contexts:

Ram Sampath v. Rajesh Roshan (2008 SCC OnLine Bom 370): Cited by the plaintiff, this Bombay High Court decision addressed the infringement of a musical work where a six-second portion was copied and repeated multiple times. The court held that copying a small but essential part, the “catch part” or “hook,” constitutes actionable infringement, emphasizing that “what is worth copying is worth protecting.” The plaintiff used this to argue that the core of "Shiva Stuti" was replicated in "Veera Raja Veera." The defendants distinguished it, noting that the plaintiff’s authorship was undisputed in Ram Sampath, and expert evidence supported the claim, unlike the present case.

Sulamangalam R. Jayalakshmi v. Meta Musicals (2000 SCC OnLine Mad 381): The plaintiff cited this Madras High Court case, where the defendant’s unauthorized use of the plaintiff’s musical work and photographs was restrained. The court protected the plaintiff’s rights, reinforcing copyright in musical works. The plaintiff argued that similar protection applied to "Shiva Stuti." The defendants countered that the case involved clear misuse (version recording and photographs), unlike the present dispute over a composition’s originality.

Marcus Gray v. Katheryn Elizabeth Hudson (28 F.4th 87, 9th Cir. 2022): Cited by the defendants, this U.S. Ninth Circuit case applied the “scène à faire” doctrine, holding that commonplace musical elements (e.g., basic note sequences) are not copyrightable. The defendants used this to argue that "Shiva Stuti"’s swaras were standard to Raga Adana, precluding copyright. The court, however, found this less applicable, noting differences between Western and Indian classical music composition.

Apple Computer Inc. v. Microsoft Corporation (35 F.3d 1435, 9th Cir. 1994): The defendants cited this U.S. case to caution against granting copyright monopolies over common elements, arguing that protecting "Shiva Stuti" would restrict creativity in Dhrupad music. The court acknowledged the principle but prioritized the specific arrangement’s originality.

R.G. Anand v. Delux Films ((1978) 4 SCC 118): This Supreme Court of India case, cited by the defendants, established that copyright protects original expression, not ideas or common themes. The defendants argued that "Shiva Stuti" lacked originality due to its reliance on traditional Dhrupad structures. The court, however, focused on the unique arrangement of swaras as protectable expression.

Suresh Jindal v. Rizsoli Corriere Della Sera Prodzioni T.V. Spa (1991 Supp (2) SCC 3): Cited by the court (not the parties), this Supreme Court case recognized the importance of crediting creative contributions, granting interim relief for acknowledgment despite the film’s foreign exhibition. The court applied this to justify directing credit for the Junior Dagar Brothers.

Neha Bhasin v. Anand Raaj Anand ((2006) 132 DLT 196): Referenced by the court, this Delhi High Court case upheld a singer’s right to be credited as the lead female singer, relying on Suresh Jindal. It supported the plaintiff’s claim for moral rights recognition.

Fox Star Studios v. Aparna Bhat (2020 SCC OnLine Del 36): Cited by the court, this Delhi High Court case granted interim relief for crediting a plaintiff’s contribution to a film, emphasizing moral rights. It reinforced the court’s decision to mandate acknowledgment.

Francis Day and Hunter Ltd v. Bron ((1963) Ch 587): Cited by the court, this UK case established that the “ear, not eye” is the primary judge in music copyright disputes, prioritizing aural impact for lay listeners. It guided the court’s infringement analysis.

Bridgeport Music, Inc. v. Dimension Films (410 F.3d 792, 6th Cir. 2005): Cited by the court, this U.S. case held that even a brief sample (e.g., three notes) can infringe if identifiable, supporting the finding that "Veera Raja Veera"’s similarity to "Shiva Stuti" constituted infringement.

Trek Leasing, Inc. v. United States (66 Fed. Cl. 8, 2005): Cited by the court, this U.S. case noted that using a work as a model or inspiration indicates copying, bolstering the finding that Rahman’s acknowledgment of Dagarvani inspiration suggested reliance on "Shiva Stuti."

Detailed Reasoning and Analysis of Judge: This judgment meticulously analyzed the issues, balancing the nuances of Indian classical music with copyright law principles. The court first addressed the originality of "Shiva Stuti." Recognizing the challenges of applying copyright to Indian classical music, the court noted that Dhrupad’s strict rules limit creative freedom compared to genres like Thumri. However, it held that the specific arrangement of swaras, their dragging, and transitions between Aroha and Avroha in "Shiva Stuti" constituted original expression. The court found prima facie evidence of the Junior Dagar Brothers’ authorship, supported by the 1978 Amsterdam performance and the Shiva Mahadeva album. The plaintiff’s claim of copyright transfer via an oral family settlement was deemed credible at the interim stage.

On infringement, the court rejected the defendants’ argument that similarities arose from Raga Adana’s discipline, noting that "Veera Raja Veera" was not based on Raga Adana but incorporated Western music elements. The court applied the tests of “comprehensive non-literal similarity” and “fragmented literal similarity,” finding that the asthayi of "Veera Raja Veera" was identical to "Shiva Stuti" in swaras, bhava (emotion), and aural impact. The notation chart and the defendants’ own comparison with Amir Khusro’s composition inadvertently highlighted this identity. The court emphasized the “ear, not eye” principle from Francis Day v. Bron, holding that a lay listener would perceive the works as similar, satisfying the infringement test from Ram Sampath and Bridgeport Music.

The court distinguished foreign precedents like Marcus Gray, noting that Hindustani classical music’s aural effect, rather than written notes, determines similarity. The deliberate selection of "Shiva Stuti" by Rahman, facilitated by the plaintiff’s disciples, further supported the finding of copying. The court dismissed the defendants’ reliance on other artists’ renditions, as these were authorized performances by Dagarvani disciples, not commercial exploitations challenging the plaintiff’s copyright.

Regarding relief, the court considered the film’s release and widespread dissemination, finding that restraining the song would disrupt an acclaimed production. Instead, it prioritized moral rights, drawing on Suresh Jindal, Neha Bhasin, and Fox Star Studios. The court held that crediting the Junior Dagar Brothers was a just remedy, as monetary damages could not compensate for the loss of recognition. The balance of convenience favored the plaintiff, as delayed acknowledgment would render the relief infructuous, causing irreparable harm to the original composers’ legacy.

Final Decision:  The court allowed the interim application (I.A. 21148/2023) with the following directions:  On all OTT and online platforms, the credit slide for "Veera Raja Veera" must be updated from “Composition based on a Dagarvani Tradition Dhrupad” to “Composition based on Shiva Stuti by Late Ustad N. Faiyazuddin Dagar and Late Ustad Zahiruddin Dagar.”  Defendants No. 1 to 3 (A.R. Rahman, Madras Talkies, and Lyca Productions) must deposit Rs. 2 crores in a Fixed Deposit with the Registrar General, subject to the suit’s final outcome.  Costs of Rs. 2 lakhs were awarded to the plaintiff, payable by Defendants No. 1 to 3 within four weeks.  The court clarified that these findings would not bind the suit’s final adjudication.

Law Settled in This Case:  This case establishes several key principles in Indian copyright law, particularly for classical music:

Originality in Traditional Music: Specific arrangements of swaras, even within the constraints of a raga, can constitute original musical works eligible for copyright protection, provided they reflect unique creative expression.Infringement Test for Music: The “ear, not eye” principle governs infringement in musical works, prioritizing aural similarity for lay listeners over technical note comparisons. Even a small but vital part of a composition, if copied, constitutes infringement.Moral Rights Recognition: Moral rights, including the right to paternity, are enforceable through interim relief, such as mandatory credit acknowledgment, especially when monetary damages are inadequate.

Case Title: Ustad Faiyaz Wasifuddin Dagar Vs A.R. Rahman: Date of Order: 25 April, 2025: Case No.: CS(COMM) 773/2023: Neutral Citation: 2025:DHC:2907: Court: High Court of Delhi: Judge: Hon'ble Ms. Justice Prathiba M. Singh

Disclaimer:The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman,IP Adjutor [Patent and Trademark Attorney] ,High Court of Delhi

Levi Strauss & Co. Vs. Rajesh Agarwal

Introduction: Decided by the High Court of Delhi on January 3, 2018, this case addresses critical issues of trademark infringement, passing off, and the evidentiary value of a Local Commissioner's report. The dispute centers around the unauthorized use of the globally renowned "LEVI'S" trademark by a small-scale merchant in Hyderabad, highlighting the tension between established brand owners and local traders. This case study delves into the factual and procedural intricacies, the legal issues at play, the arguments presented, the judicial reasoning, and the broader implications of the decision for trademark law in India.

Detailed Factual Background:  Levi Strauss & Co., a globally recognized apparel company, has been using the "LEVI'S" and "LEVI STRAUSS" trademarks since 1850, particularly for its iconic jeans. The company is the registered proprietor of these trademarks in India, with registrations in Class 25 for apparel, as evidenced by trademark registration numbers 352692, 382357B, 290954, 350738, 317649B, and 270875B. The plaintiff claimed that its brand is synonymous with quality and enjoys significant goodwill, supported by substantial sales and advertising expenditures, including over Rs. 25 crores in sales and Rs. 4.7 crores in advertising in India in the year prior to the suit's filing in 2001.

The defendant, Rajesh Agarwal, operated a small retail shop in Hyderabad, where he was found selling apparel bearing logos and devices identical to those of Levi Strauss. The plaintiff alleged that these products infringed their registered trademarks and constituted passing off by misleading consumers into believing they were purchasing genuine Levi's products. The infringing goods were discovered during an inspection by a court-appointed Local Commissioner, who seized 57 pairs of jeans bearing the infringing marks. The defendant's actions prompted Levi Strauss to file a suit for permanent injunction, damages, and other reliefs to protect its intellectual property rights.

Detailed Procedural Background: The suit was initially filed in 2001 before the original side of the Delhi High Court, seeking a permanent injunction to restrain trademark infringement, copyright violation, and passing off. On October 3, 2001, the court granted an ex-parte ad-interim injunction in favor of Levi Strauss and appointed a Local Commissioner to inspect the defendant's premises in Hyderabad. The Commissioner conducted the inspection on October 6, 2001, and filed a detailed report on October 12, 2001, confirming the presence of infringing goods. The seized items were handed over to the defendant on superdari.

The defendant initially appeared in the suit and filed a written statement but subsequently stopped participating, leading to ex-parte proceedings against him on two occasions. Due to an increase in the pecuniary jurisdiction of the district courts, the case was transferred to the Additional District Judge, who dismissed the suit on November 28, 2006. The trial court cited two primary reasons for dismissal: the plaintiff's failure to examine the Local Commissioner as a witness and the absence of evidence showing an assignment of trademarks to Levi's Strauss India Pvt. Ltd., the plaintiff's Indian affiliate.

Aggrieved by the dismissal, Levi Strauss filed an appeal (RFA 127/2007) before the Delhi High Court. The respondent could not be served despite repeated attempts, leading the court to order service by publication in the Indian Express, Hyderabad edition, on May 28, 2007. The publication was completed, but the respondent did not appear. The appeal was admitted on October 23, 2007, and the interim injunction from 2001 was continued. The matter was finally heard on January 3, 2018, with no appearance from the respondent.

Issues Involved in the Case:  The case presented several critical legal issues for adjudication: Whether the trial court erred in dismissing the suit on the ground that the Local Commissioner was not examined, despite the Commissioner's report being part of the record?

Appellant's Submissions:

Appellant argued that the trial court's dismissal was fundamentally flawed. On the issue of the Local Commissioner's report, they relied on Order 26 Rule 10(2) of the Code of Civil Procedure (CPC), which stipulates that a Commissioner's report and the evidence collected form part of the suit's record and are admissible without the Commissioner's examination. They cited two judgments to bolster this position: Misrilal Ramratan & Ors. v. A.S. Shaik Fathimal & Ors. (1995 Supp (4) SCC 600) and Harbhajan Singh v. Smt. Shakuntala Devi Sharma & Anr. (AIR 1976 Delhi 175). These cases establish that a Commissioner's report cannot be rejected merely because the Commissioner was not examined, especially when no party challenges its contents.

Regarding the assignment issue, the appellant contended that Levi Strauss & Co., as the registered proprietor of the trademarks, was not required to assign its marks to its Indian subsidiary. The plaintiff and its affiliates, including Levi's Strauss India Pvt. Ltd., operated as a single economic entity, a concept supported by the Delhi High Court's decision in George V. Records, SARL v. Kiran Jogani & Anr. (2004 (28) PTC 347 (Del)). The counsel emphasized that the trademarks were owned by Levi Strauss globally, and their use by affiliates under license or permission did not necessitate a formal assignment. Evidence of sales (over Rs. 25 crores) and advertising (Rs. 4.7 crores) in India, certified by a Chartered Accountant (Exhibit PW1/4), and advertisements in prominent magazines like Filmfare and Elle (Exhibits PW1/6) demonstrated the extensive use and reputation of the marks in India.  The appellant further argued that the Local Commissioner's report, which documented 57 pairs of jeans with infringing marks, conclusively proved infringement and passing off. The scanned copies of the infringing labels showed identical copying of the plaintiff's trademarks, violating their proprietary rights and misleading consumers.

Detailed Discussion on Judgments Cited by Parties and Their Context:  The appellant relied on three key judgments to support their arguments, each addressing specific aspects of the case:

Misrilal Ramratan & Ors. v. A.S. Shaik Fathimal & Ors. (1995 Supp (4) SCC 600): This Supreme Court decision was cited to argue that a Local Commissioner's report is part of the suit's record and cannot be rejected merely because the Commissioner was not examined. The court held that the report is admissible evidence, and non-examination is not a valid ground for dismissal unless a party raises specific objections. In the context of this case, the judgment was directly relevant, as the respondent did not challenge the Commissioner's report, and the trial court's insistence on examination was erroneous.

Harbhajan Singh v. Smt. Shakuntala Devi Sharma & Anr. (AIR 1976 Delhi 175): This Delhi High Court ruling reinforced the principle that a Commissioner's report is evidence under Order 26 Rule 10(2) of the CPC. The court clarified that examination of the Commissioner is not mandatory unless required for clarification or challenged by a party. The appellant used this precedent to argue that the trial court's dismissal for non-examination was contrary to established law, given the respondent's reliance on the report without objection.

George V. Records, SARL v. Kiran Jogani & Anr. (2004 (28) PTC 347 (Del)): This Delhi High Court decision was pivotal in addressing the assignment issue. The court recognized the concept of a "single economic entity," where a parent company and its subsidiaries or affiliates are treated as one for trademark protection purposes. The appellant argued that Levi Strauss & Co., as the registered proprietor, did not need to assign its marks to its Indian subsidiary, as the subsidiary's use was under the parent's authority. This precedent supported the plaintiff's claim that their global business structure did not undermine their trademark rights in India.The respondent did not cite any specific judgments in his written statement, relying instead on factual assertions about his status as a petty merchant and the nature of the seized goods.

Detailed Reasoning and Analysis of Judge: The court delivered a comprehensive judgment that systematically addressed the trial court's errors and upheld the plaintiff's trademark rights. The reasoning focused on three main aspects: the evidentiary value of the Local Commissioner's report, the assignment issue, and the substantive issue of infringement and passing off.

Evidentiary Value of the Local Commissioner's Report:  The judge found the trial court's dismissal for non-examination of the Local Commissioner to be legally untenable. Citing Order 26 Rule 10(2) of the CPC, the court noted that a Commissioner's report and accompanying evidence are part of the suit's record and admissible without the Commissioner's testimony. The Supreme Court's ruling in Misrilal Ramratan clarified that rejecting a report for non-examination is a "specious plea" unless specific objections are raised. Similarly, the Delhi High Court's decision in Harbhajan Singh affirmed that examination is not compulsory, particularly when the report is unchallenged.

In this case, the respondent's written statement relied on the Commissioner's report to argue that no manufacturing unit existed and the goods were not for sale, without disputing the report's authenticity or contents. The judge emphasized that the respondent's failure to challenge the report obviated the need for examination. The Local Commissioner's detailed report, filed on October 12, 2001, documented 57 pairs of jeans with infringing marks, supported by scanned copies of the labels. The court held that the trial court's insistence on examination was erroneous and contrary to settled law.

Assignment and Single Economic Entity:  The trial court's second ground for dismissal—lack of evidence of assignment to Levi's Strauss India Pvt. Ltd.—was equally flawed. The judge accepted the appellant's argument that Levi Strauss & Co., as the registered proprietor of the trademarks, did not need to assign its marks to its Indian subsidiary. The court relied on the Delhi High Court's decision in George V. Records, which recognized that a parent company and its affiliates operate as a single economic entity for trademark purposes. The plaintiff provided evidence of trademark registrations (Exhibit PW1/9) in its name, confirming its proprietary rights.

The judge further noted that the sales and advertising figures (Exhibits PW1/4, PW1/5, PW1/6) submitted by the plaintiff, though pertaining to the Indian subsidiary, were relevant to establish the marksVestive use and reputation of the trademarks in India. The court held that requiring an assignment to the subsidiary was unnecessary, as the subsidiary's activities were under the plaintiff's authority. The concept of a single economic entity ensured that the plaintiff's global business structure did not prejudice its trademark rights, aligning with the fundamental purpose of trademarks as source identifiers.

Infringement and Passing Off:  The court found that the respondent's use of identical logos and labels constituted a "classic case of identical copying." The scanned copies of the infringing labels showed misuse of the plaintiff's name and accompanying devices, violating their registered trademarks and constituting passing off. The judge emphasized that the trust consumers place in a brand transcends the entities selling the products locally, reinforcing the need to protect trademarks as source identifiers.

Final Decision:  The High Court set aside the trial court's judgment dated November 28, 2006, and decreed the suit in favor of Levi Strauss. The plaintiff was granted a permanent injunction restraining the respondent from infringing the "LEVI'S" and "LEVI STRAUSS" trademarks, as prayed in clauses (i), (ii), and (iii) of the plaint. The appellant did not press the claim for damages. The court awarded costs of Rs. 14,750, comprising Rs. 7,400 in suit court fees and Rs. 7,350 in appeal court fees, reflecting the modest scale of the infringement (57 pairs of jeans). The appeal was allowed, and all miscellaneous applications were disposed of as infructuous.

Law Settled in This Case: This case settled several important principles in Indian trademark law:

A Local Commissioner's report is admissible evidence under Order 26 Rule 10(2) of the CPC and does not require the Commissioner's examination unless specifically challenged by a party.A parent company and its subsidiaries or affiliates are treated as a single economic entity for trademark protection, eliminating the need for formal assignments to local entities when the parent is the registered proprietor.The use of identical logos and labels constitutes trademark infringement and passing off, particularly when it misleads consumers about the source of the goods.

Case Title: Levi Strauss & Co. Vs. Rajesh Agarwal

Date of Order: January 3, 2018

Case No.: RFA 127/2007

Neutral Citation: 2018:DHC:34

Name of Court: High Court of Delhi

Name of Judge: Justice Prathiba M. Singh

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi