Ayur United Care LLP Vs Union of India

Introduction:In the evolving landscape of intellectual property law in India, the abolition of the Intellectual Property Appellate Board (IPAB) on April 4, 2021, marked a significant shift in the adjudication of IP disputes, transferring such matters to the High Courts. This transition raised intricate questions about procedural norms, particularly regarding the appropriate bench composition for hearing challenges to pre-abolition IPAB orders. 

The case of Ayur United Care LLP versus Union of India & Anr., along with several connected writ petitions, exemplifies this transitional complexity. Decided by the High Court of Delhi, the judgment delves into whether writ petitions under Articles 226 and 227 of the Constitution, contesting IPAB decisions on trademark rectifications, should be adjudicated by a Single Judge or a Division Bench. At its core, the dispute revolves around the interpretation of the Intellectual Property Division (IPD) Rules, 2021, and the Delhi High Court Rules, 2018, highlighting tensions between statutory mandates, judicial efficiency, and historical appellate structures. The petitioners, primarily entities holding or challenging the trademark "AYUR," faced rectification orders from the IPAB that favored the second respondents, prompting these writs. 

Factual Background:The controversy stems from disputes over the trademark "AYUR," a term associated with traditional Indian wellness and Ayurvedic products. The petitioners, including Ayur United Care LLP, M H Polymers Pvt. Ltd., and Three N-Products Pvt. Ltd., held registrations for this mark, which they claimed as proprietary for their goods and services. 

The second respondents, appearing in various petitions, filed rectification applications before the IPAB, arguing that "AYUR" was generic or descriptive and thus not eligible for exclusive registration. On June 28, 2013, the IPAB allowed these rectification petitions, effectively challenging or revoking the petitioners' registrations in favor of the applicants. 

Aggrieved by this, the petitioners invoked Articles 226 and 227 of the Constitution to file writ petitions before the High Court of Delhi, seeking to set aside the IPAB's orders. These petitions were lodged prior to the IPAB's abolition but gained renewed urgency post-April 4, 2021, when the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021, dissolved the IPAB and transferred its pending matters to the High Courts. 

The factual matrix is compounded by multiple interconnected petitions, each involving similar trademark disputes but with varying parties, such as Ayur United Care LLP as the common petitioner in several cases, and entities like Three N-Products Pvt. Ltd. in others. The underlying IP issue—whether "AYUR" qualifies as a distinctive mark or falls into the public domain—remains substantive, but the judgment primarily addresses a preliminary threshold question arising from the respondents' objection that these matters could not be heard by a Single Judge.

Procedural Background:The procedural journey began with the filing of rectification petitions against the "AYUR" trademark registrations before the IPAB, culminating in its June 28, 2013, order favoring rectification. The aggrieved registrants then approached the High Court of Delhi via writ petitions under Articles 226 and 227, which were initially listed and proceeded in the ordinary course. However, the abolition of the IPAB on April 4, 2021, via the Tribunals Reforms Ordinance (later enacted as the Tribunals Reforms Act, 2021), redirected all IPAB-related appeals and proceedings to the jurisdictional High Courts, including Delhi's newly established Intellectual Property Division (IPD). 

This led to the transfer and re-designation of the petitions as W.P.(C)-IPD series cases. During hearings, the respondents raised a serious preliminary objection, contending that these writs, challenging quasi-appellate IPAB orders, must be heard by a Division Bench rather than a Single Judge, invoking rules on bench composition for matters involving fundamental rights or statutory interpretations. The petitioners countered that the IPD Rules mandated Single Judge adjudication for IP subject matters, except in specified exceptions. 

Reasoning and Decision of Court:The court's reasoning commences with a clear delineation of the rival submissions, acknowledging the petitioners' insistence on Single Judge jurisdiction under the IPD Rules and the respondents' push for Division Bench hearing based on the Delhi High Court Rules and the nature of the writs. 

Rule 4's general mandate for Single Judge adjudication in IPD, Rule 2(l)'s inclusion of writs arising from IPR subjects except Division Bench matters, and the wide ambit of "matter" in Rule 2(i) encompassing trademarks. It noted that Section 13 of the Commercial Courts Act pertains to appeals from decrees, irrelevant here. Harmonizing the rules, the court rejected the rigid Division Bench requirement, holding that a writ petition challenging an IPAB trademark order constitutes an "IPR subject matter" to be heard by a Single Judge under IPD Rule 4, as it does not trigger DHC Rules' Division Bench exceptions. 

The decision underscores that post-abolition, such petitions are original proceedings before the IPD, not appeals, and thus fall within Single Judge domain for efficiency. While appreciating alternative options, the court deemed them unnecessary, affirming its own jurisdiction as a Single Judge and directing the matters to proceed on merits, thereby resolving the preliminary objection in favor of Single Bench hearing.

Point of Law Settled in the Case:The judgment settles a pivotal point of law concerning the jurisdictional framework post-IPAB abolition: writ petitions under Articles 226 and 227 challenging pre-abolition IPAB orders on intellectual property matters, such as trademark rectifications, are to be adjudicated by a Single Judge of the Intellectual Property Division (IPD) of the High Court, unless they fall within explicit exceptions requiring Division Bench hearing under the Delhi High Court Rules, 2018, or Section 13 of the Commercial Courts Act, 2015. 

This clarification arises from a harmonious interpretation of the IPD Rules, 2021—particularly Rules 4, 2(i), 2(j), and 2(l)—which define IP subject matters broadly to include patents, copyrights, trademarks, and related disputes, mandating Single Judge resolution for efficiency in the post-tribunal era. 

The court elucidates that such petitions, though stemming from appellate-like IPAB proceedings, are treated as original IPD matters upon transfer, not invoking DHC Rules' Division Bench mandates for cases involving statutory vires, personal liberty, or public interest litigation. 

This ruling prevents procedural fragmentation, ensuring streamlined adjudication of legacy IPAB cases while respecting the legislative intent behind the Tribunals Reforms Act, 2021, to decongest tribunals and empower High Courts. It also underscores that the term "matter" in IPD Rules encompasses IPAB orders, rejecting arguments for mandatory Division Bench listing based on the quasi-appellate nature of the challenge, and affirms that Single Judges possess inherent jurisdiction unless statutorily ousted.

Case Detail: Ayur United Care LLP Vs Union of India & Anr. 

Date of Order: 16 October 2023

Case Number: W.P.(C)-IPD 61/2021

Neutral Citation: 2023:DHC:7556

Name of Court: High Court of Delhi at New Delhi

Name of Hon'ble Judge: Mr. Justice C. Hari Shankar

Disclaimer: Readers are advised not to treat this as substitute for legal advise as it may contain errors in perception, interpretation, and presentation

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