Metco Polymers Pvt. Limited and Pradeep Ranganathan vs Madhu Inflatables Pvt. Limited and Madhu Communications Pvt. Limited

P.K. Misra, J.—The present appeal is directed against the order dated 6.4.2005 in O.A.No.731 of 2005 arising out of C.S.No.638 of

2003.

The said suit was filed by the present appellants u/s 22 of the Designs Act, 2000 (hereinafter referred to as ""the Act"") for permanent injunction

restraining the defendants from in any manner infringing upon the Registered Designs granted to the second plaintiff in respect of the manufacture

and sale of the articles, namely, Air Water Beds, Water Beds and Squared Water Seats/Water Cushion and, directing the defendants to render

true and proper accounts to the plaintiffs in respect of the manufacture or sales of the Air Water Beds, Water Beds and Squared Water

Seats/Water Cushion and, consequently directing the defendants to pay damages to the plaintiffs.

During pendency of the suit, the appellants also filed an application for interim injunction restraining the defendants / respondents from the

manufacture, sale, distribution and all other connected activities relating to the products, Air Water Beds, Water Beds and Squared Water

Seats/Water Cushion, imitating the registered designs granted to the second plaintiff.

According to the plaintiffs, the second plaintiff obtained design registration for Air Water Beds, Water Beds and Squared Water Seats/Water

Cushion on 27.11.2002. The second plaintiff, who is a technocrat involved in the inflatable business for about 20 years, invented Air Water Beds,

Water Beds and Squared Water Seats/Water Cushion with novelty, originality and speciality in shape and configuration, which were subsequently

registered under the Designs Act. The basic allegation contained in the plaint as well as the application for injunction is to the effect that the

products are specially designed to suit the requirement of the medical profession and the respondents, who were originally the advertising agent,

manufactured similar products adopting similar designs.

The case of the respondents in short is that they were manufacturing water beds from 1997, much before the design was registered by the

plaintiffs/appellants, and such products were being sold with trademark Madhu Medcure and Madhu Unicare. It was their contention that since

their products were advertised much earlier, it can be taken that they had made prior publication of the Designs which were registered by the

plaintiffs subsequently on 27.11.2002.

Learned single Judge on considering the rival submissions came to the conclusion that even though the plaintiffs'' products and the defendants''

products were almost similar in design and since u/s 4 of the Designs Act there is a prohibition of registration of a design which is not new or

original or has been disclosed to public or used prior to the filing an application for registration and since such a defence was permissible to be

taken, u/s 22 read with 19 of the Act, no injunction can be issued. The said order is under challenge in the present appeal.

Learned Senior Counsel for the appellants has submitted that the learned single Judge has erroneously placed reliance upon Section 19 of the

Designs Act at the stage of considering the question of injunction.

At this stage, it may be necessary to notice to the relevant provisions contained in the Designs Act, 2000. Chapter II of the Act relates to

Registration of Designs. It states inter alia that a design, which is not new or original or has been disclosed to the public any where in India or in any

other country by publication in tangible form or by use or in any other way prior to the filing date for registration, shall not be registered. Section 5

provides for filing of application for registration of designs and Section 6 envisages registration to be in respect of particular article. Section 9

empowers the Controller to grant certificate of registration to the proprietor of the design when registered.

Section 19, which occurs in Chapter III, relates to cancellation of registration and it is to the following effect :-

Cancellation of registration

(1) Any person interested may present a petition for the cancellation of the registration of a design at any time after the registration of the design, to

the Controller on any of the following grounds, namely:-

(a) that the design has been previously registered in India; or

(b) that it has been published in India or in any other country prior to the date of registration; or

(c) that the design is not a new or original design; or

(d) that the design is not registrable under this Act; or

(e) that it is not a design as defined under clause (d) of section 2.

(2) An appeal shall lie from any order of the Controller under this section to the High Court, and the Controller may at any time refer any such

petition to the High Court, and the High Court shall decide any petition so referred.

Chapter V relates to legal proceedings. Section 22 relates to piracy of registered design and it is to the following effect :-

Piracy of registered design

(1) During the existence of copyright in any design it shall not be lawful for any person

(a) for the purpose of sale to apply or cause to be applied to any article in any class of articles in which the design is registered, the design or any

fraudulent or obvious imitation thereof, except with the licence or written consent of the registered proprietor, or to do anything with a view to

enable the design to be so applied; or

(b) to import for the purposes of sale, without the consent of the registered proprietor, any article belonging to the class in which the design has

been registered, and having applied to it the design or any fraudulent or obvious imitation thereof; or

(c) knowing that the design or any fraudulent or obvious imitation thereof has been applied to any article in any class of articles in which design is

registered without the consent of the registered proprietor, to publish or expose or cause to be published or exposed for sale that article.

(2) If any person acts in contravention of this section, he shall be liable for every contravention-

(a) to pay to her registered proprietor of the design a sum not exceeding twenty five thousand rupees recoverable as a contract debt, or

(b) if the proprietor elects to bring a suit for the recovery of damages for any such contravention, and for an injunction against the repetition

thereof, to pay such damages as may be awarded and to be restrained by injunction accordingly.

PROVIDED that the total sum recoverable in respect of any one design under clause (a) shall not exceed fifty thousand rupees;

PROVIDED FURTHER that no suit or any other proceedings for relief under this sub-section shall be instituted in any court below the court of

District Judge.

(3) In any suit or any other proceeding for relief under sub-section (2), every ground on which the registration of a design may be cancelled u/s 19

shall be available as a ground of defence.

...

Learned counsel for the appellants has contended that in the present case the learned single Judge has rejected the application for injunction by

prima facie accepting the defence as contemplated u/s 22(3) on the footing that registration of the design may be cancelled u/s 19. He has

submitted that such a defence is only available to be raised and decided at the time of final decision of the suit and such defence is not available at

the stage of considering interim application for injunction.

We do not think such a contention can be accepted. Section 22(3) envisages every ground on which the registration of a design may be

cancelled u/s 19 shall be available as a ground of defence in any suit or any other proceeding for relief under sub-section (2). u/s 22(2) any person

who acts in contravention of Section 22 shall be liable for every contravention as envisaged in clause (a) and if the proprietor elects to bring a suit

for the recovery of damages and for an injunction against the repetition to pay such damages as may be awarded and to be restrained by injunction

accordingly.

In the present case, the plaintiffs/appellants has brought the suit claiming damages as well as claiming injunction. Interim injunction claimed by

the appellants is only in aid of the final relief claimed by them. It is therefore axiomatic to hold that the defences which are available to the

defendants at the time of final decision of the suit are also available at the stage of considering the interim application for injunction. Therefore, the

legal contention raised by the counsel for the appellants cannot be accepted.

The expression ""any other proceeding"" as contained in Section 22(3) is to be understood in a wider sense and the application for interim

injunction can be considered as a proceeding within the meaning of Section 22(3) of the Act. The restricted meaning given to the term ""proceeding

in some matters, particularly, in the context of Section 115 of the CPC may not be applicable. Any other interpretation of Section 22(3) may

create an anomaly inasmuch as even though the defendants would be able to resist the suit by raising defences envisaged u/s 22(3) read with

Section 19, they would not be able to resist an interim application for injunction.

In the present case, the learned single Judge has observed that the defendants had manufactured the products with similar design and it had

been published in India prior to the date of registration and, therefore, the registration was liable to be cancelled. Such observation of the learned

single Judge must obviously be taken to be a prima facie observation which is neither binding on the trial court at the time of final decision of the

suit nor any such observation is binding on the authority, which is required to consider the petition for cancellation of registration of the design.

Even though we are not inclined to pass any order of injunction at this stage by differing from the learned single Judge, as a discretionary order has

been passed, we make it clear that any observation made by the learned single Judge must be taken to be only a prima facie observation made for

the purpose of considering the interim application and, any proceeding pending u/s 19 and the suit are required to be disposed of on their own

merit without being influenced in any manner by the observations made by the learned single Judge. We are also making it clear that we have not

expressed any opinion one way or the other in the matter save and except stating that we are not inclined to take a different view in respect of the

prima facie conclusion. We however feel that interest of justice would be served by directing the respondents to maintain accounts in respect of the

transactions to be made hereafter so that it would be convenient to quantify the extent of damages payable, if the appellant ultimately succeeds in

the suit. Such accounts should be produced before the Registry once in every six months by serving a copy to the plaintiff.

For the aforesaid reasons, the appeal is disposed of subject to the clarification and direction issued above. No costs. Consequently, the

connected miscellaneous petitions are closed. Keeping in view the nature of dispute, the suit may be taken up for earlier disposal on out of turn

basis.