SUN PHARMACEUTICAL INDUSTRIES LTD Vs. STADMED PVT LTD
LAWS(IP)-2006-8-1
INTELLECTUAL PROPERTY APPELLATE BOARD
Decided on August 04,2006

Appellant
VERSUS
Respondents

JUDGEMENT

Syed Obaidur Rahaman (T), Member - (1.) THIS is an appeal against the order dated 24.03.2003 passed by the Respondent No. 2, the Deputy Registrar of Trade Marks and the said appeal came up for hearing on 28.06.2006 at the Circuit Bench, Mumbai.
(2.) The issue in this appeal is whether the Trade Marks Registry of Mumbai has the jurisdiction under Section 107 of the Trade and Merchandise Marks Act, 1958 (hereinafter referred to as the Act) to entertain a rectification application filed by the respondent while suit a for infringement is pending before the Hon'ble High Court. The case is that the rectification application was filed by the respondent No. 1 (M/s Stadmed Private Limited) against the appellant (M/s Sun Pharmaceutical Industries Limited, Mumbai). The appellant manufactures medicines and medicinal preparation. The medicine is sold under the Trade Mark 'ZOLAM' and 'ALZOLAM'. In opposition to the rectification application, it was contended that the medicines are used in the market. The appellant's case is that the appellant company is the registered proprietor of trade mark 'ALZOLAM' and 'ZOLAM' registered under Nos. 480057 and '450115', respectively, in Class 5 of the Fourth Scheduled to the Act. One FDC Limited, a company incorporated under the provisions of the Companies Act, 1956 applied for and obtained registration of the mark ZOLAM in respect of medicinal and pharmaceutical preparations under Trade Mark Application No. 450115 as on 25.02.86. By a deed of assignment dated 20.09.93, the said FDC Limited assigned the said Trade Mark to one Shri Harish Uchil, trading under the name and style of M/s. Alpha International which in turn assigned the same to the petitioner/appellant by deed of assignment dt. 27.09.93. Thus, the petitioners are the proprietors of the trade mark ZOLAM and the petitioners are shown as subsequent proprietors of the trade mark ZOLAM as per the assignment deed. It is also the case of the petitioner/appellant that they filed a suit in the High Court of Calcutta being Suit No. 338/94 against the respondent No. 1 for infringement of the trade marks ALZOLAM and ZOLAM registered under No. 480057 and 450115, respectively, both in Class 5 for using the identical and deceptively similar trade mark ZOLAM. The appellant made on application and injunction was granted and the injunction was ultimately vacated in the said Suit No. 338/94. On 31.01.95, the respondent No. 1 filed an application for rectification before respondent No. 3 bearing Application for Rectification No. BOM-1034 on the grounds that the trade mark ZOLAM is not distinctive of the appellant and that the same was registered with out any bona fide intention to use and there is in fact no bona fide use of the said trade mark ZOLAM in relation to the goods of the petitioners for the time being, one month before the date of application or that upto the date of one month before the date of application or that upto the date of one month before the date of application a continuous period of 5 years had elapsed during which the trade mark ZOLAM was not is fact used and, therefore, the same is liable to be removed from the register being wrongly registered. The respondent No. 1 also mentioned that they had filed an application for registration of the trade mark ZOLAM in July 1992 under application No. 566022 in Class 5 of the Act and the same is pending. The respondent No. 1 filed another application for rectification before the respondent No. 3 being application for rectification No. BOM-1033 on the grounds that the trade mark ALZOLAM was not registrable as the same is deceptively similar to the basic drug ALPRAZOLAM and, therefore, not registrable on various grounds in terms of Section 9 of the Act and the same has been decided by respondent No. 2 against the respondent No. 1. The petitioner filed an interlocutory Application stating that on 31.01.95 when the first respondent filed an application for rectification of the trade mark ZOLAM a suit for infringement of the registered trade mark ZOLAM registered under No. 450115 in Class 5 was already pending in the High Court of Calcutta. Hence under the provisions of Section 107 of the said Act, when a suit for infringement of registered trade mark is pending, an application for rectification ought to be made to the appropriate High Court and not before the Registrar of Trade Marks. The petitioner stated that the application for rectification was not maintainable and the same is liable to be dismissed. The respondent No. 2, namely the Deputy Registrar of Trade Marks, Mumbai, vide his order dated 10.07.98 held that the said Act or the Rules did not say that respondent No. 2 should not deal with the rectification or that the same should be withdrawn and re-filed while the suit is pending in the High Court and hence the respondent No. 2 proceeded to dismiss the interlocutory Application filed by the petitioner and directed them to file the counter-statement in accordance with the law. On the basis of the said order on 12.05.99, the petitioners filed their counter-statement. In that counter-statement, they denied all the averments made by the respondent and stated that they had been carrying on a leading and well established business as manufacturers and dealers in medicinal and pharmaceutical preparations and are using many trade marks during the course of the trade. The appellants also stated that the word 'ZOLAM' was naturally conceived and adopted by M/s FDC Limited who subsequently assigned the mark to one M/s Alpha International, who in turn, assigned the mark to the petitioner/appellant. The respondent filed their evidence on 27.12.1999 under Rule 53 of the Trade and Merchandise Marks Rules, 1959 along with documentary evidence such as drug licence, reply copy, copy of injunction order, bills, challans and orders, etc. The appellant/petitioner did not file any evidence in support of their case as the evidence was already filed in the rectification application bearing No. BOM-1033. The respondent No. 2 heard both the applications for rectification, namely BOM-1033 and BOM-1034 in respect of the trade marks ALZOLAM and ZOLAM respectively. On 24.03.03, the Deputy Registrar of Trade Marks, Mumbai allowed the application for rectification being application No. BOM-1034 but by his order dated 31.03.03, the Deputy Registrar of Trade Marks, Mumbai disallowed the Rectification Application No. BOM-1033 in respect of the trade mark ALZOLAM. Being aggrieved by the order dated 24.03.03 passed by the Deputy Registrar of Trade Marks allowing the rectification application, this appeal is filed. In the appeal, the petitioner/appellants have made the points in ground 'c' and 'd' that the learned Deputy Registrar of Trade Marks failed to appreciate the fact that Section 107 (1) of the Act provides that in a suit for infringement of registered trade marks, when the validity of the registration of the plaintiffs trade mark is questioned by the defendant, the issue as to the validity can be determined on application for rectification, and such application for rectification shall be made to the High Court. The petitioner have also taken the ground that the learned Registrar of Trade Marks ought to have held that the provisions under Section 107 (1) of the Act applied to the present case and further ought to have dismissed the application for rectification on the ground that in the suit for infringement of the trade mark ZOLAM the first respondent had questioned the validity of the trade mark and in the event, the issue as to the validity could have been only determined by the High Court. The petitioner have also taken the ground that the application for rectification ought to have been referred to the High Court as per Section 107 (2) of the Act. They have also taken the ground that in spite of the order dated 09.08.02 passed by the Hon'ble High Court of Calcutta, the learned Registrar of Trade Marks has not taken the same into consideration. The learned Registrar of Trade Marks failed to appreciate that the respondent No. 2 had no jurisdiction to entertain the application for rectification in terms of Section 107 of the Act. The appellant has also taken the ground that the order dated 10.07.98 passed by the learned Registrar of Trade Marks in the interlocutory petitioner filed by the petitioner is without any jurisdiction and did not consider the interlocutory petition. In support of his case, the learned Counsel for the appellant Shn Amit Jamsandukar submitted that the Deputy Registrar of Trade Marks has no jurisdiction to entertain the application while a suit is pending in the High Court and the order of Deputy Registrar of Trade Marks should be set aside. In support of his case he referred to a judgment in Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. 1997 PTR 110 : 1998 PTC (18) 717(SC). In para 48 of the said judgment it is stated that as follows: It is in the background of the above provisions that the question relating to the jurisdiction of the "Registrar" and the "High Court", which individually and separately constitute 'TRIBUNAL" within the meaning of Section 2(1)(x), has to be considered. In para 55 it is stated that: An order for rectification, if passed by the High Court, is implemented by the Registrar by rectifying the Register in conformity with the order passed by the High Court. In para 56 it is stated that:L The extent of jurisdiction conferred by Section 56 of the Registrar to rectify the Register, is however, curtailed by Section 107 which provides that an application for rectification shall, in certain situations, be made only to the High Court. These situations are mentioned in Sub-section (1) of Section 107, namely, where in a suit for infringement of the registered Trade Mark, the validity of the registration is questioned by the Defendant or the defendant, in that suit, raises the defence contemplated by Section 30(1)(d) in which the acts which do not constitute an infringement, have been specified, and the plaintiff in reply to this defence questions the validity of the defendant's Trade Mark. In these situations, the validity of the registration of the Trade Mark can be determined only by the High Court and not by the Registrar. In para 57 it is also held that "Section 107 thus implies the proceedings to be institute only in the High Court. The jurisdiction to the Registrar in those cases which are covered by Section 107 is totally excluded. Significantly, Section 107 (2) provides that if any application for rectification is made to the Registrar under Section 46 or Section 47(4) or Section 56, the Registrar may, if he thinks fit, refer that application, at any stage of the proceeding, to the High Court". He also referred to para 59 wherein it is stated that: In this background, the phrase "before" which the proceeding concerned is pending stands out prominently to convey the idea that if the proceeding is pending before the "Registrar", it becomes the "TRIBUNAL". Similarly, if the proceeding is pending before the "High Court", then the High Court has to be treated as "TRIBUNAL". Thus, the jurisdiction of the Registrar and the High Court, though apparently concurrent in certain matters, is mutually exclusive. That is to say, if a particular proceeding is pending before the Registrar, any other proceeding, which may, in any way, relate to the pending proceeding, will have to be initiated before and taken up by the Registrar and the High Court will act as the Appellate Authority of the Registrar under Section 109. It is obvious that if the proceedings are pending before the High Court, the Registrar will keep his hands off and not touch those or any other proceedings which may, in any way, relate to those proceedings, as the High Court, which has to be the High Court having jurisdiction as set out in Section 3, besides being the Appellate Authority of the Registrar has primacy over the Registrar in all matter under the Act. Any other interpretation of the definition of "TRIBUNAL" would not be in consonance with the scheme of the Act or the contextual background set out therein and may lead to conflicting decision on the same question by the Registrar and the High Court besides generating multiplicity of proceedings. In view of the above judgment, the learned Counsel for the appellant prayed that the Registrar of Trade Marks has no power to entertain the application when a suit is pending before the High Court and prayed that the order passed by the Deputy Registrar of Trade Marks should be set aside. On the contrary, one Shri Alok Kumar Bose filed a reply stating that the company is a reputed manufacturer of various medicines and pharmaceutical preparations and are doing business of such pharmaceuticals throughout India. They made an application for manufacture and marketing and the drug licence was issued in favour of M/s Stadmed Private Limited on 23.07.90. The respondent No. 1 invented and adopted the word in trade mark 'ZOLAM' for pharmaceutical and medical preparations since 1991 continuously and extensively in the course of its trade in three different manners namely 'ZOLAM 0.25', 'ZOLAM 0.50' and 'ZOLAM 1'. He also stated in his counter statement that an application for registration of the said trade mark 'ZOLAM' vide Application No. 566022 in Class 5 was made on 22.1.92. He also stated that the Registrar of Trade Marks, Mumbai has rightly allowed the application for rectification filed by the respondent and held that he had the jurisdiction to entertain and hear the application and the application. He also stated that it is wrong to say that the provisions of Section 107 will apply since at the time when the application was filed, the respondent had not even filed their averments in the Suit No. 338/94 filed by the petitioner. He also stated that the suit came to be stayed by the Hon'ble High Court of Calcutta on the ground that an application for rectification is pending before the Registrar of Trade Marks which is not challenged by the petitioner. He further stated that the learned Registrar of Trade Marks has rightly decided that since the issue of jurisdiction had been decided vide order dated 10.07.98, hence the issue could not be re-opened. As per the provisions of the law, the person aggrieved by an interim order has to prefer an appeal against the said order challenging the legal validation and propriety of the same or can raise the issue in appeal if the suit or appeal is finally disposed of. He also stated that the order dated 19.08.02 was not challenged by the petitioner by filing an appeal and hence the petitioner could not reopen the issue of jurisdiction at the time of hearing the application for rectification since the same had already been heard and disposed of. He also stated that the appellant has suppressed the material fact from this Hon'ble Court and has not come before the Hon'ble Court with clean hands. So the appeal is liable to be dismissed with costs. The learned Counsel submitted that the validity suit should be stayed for valid registration and he also submits that since 1990, when the petitioners applied for registration, they have not used the trade mark not even once. So the learned Registrar of Trade Marks has rightly rectified the register.
(3.) AFTER hearing both the parties, and as per the observations of the Apex Court, we are of the view that the Registrar of Trade Marks has no power to entertain the application for rectification under Section 107 of the Act when a suit is pending before the High Court. In the case of Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. 1997 PTR 110 : 1998 PTC (18) 717(SC), the Hon'ble Supreme Court has held as under: In view of the pendency of these proceedings in the High Court and specially in view of Section 107 of the Act, the Registrar could not legally issue any suo motu notice to the appellant under Section 56(4) of the Act for cancellation of the Certificate of Registration/Renewal already granted. The appeal is consequently allowed and the show-cause notice issued by the Deputy Registrar (respondent No. 2) on 26th of September, 1997 under Section 56(4) of the Act is hereby quashed. The appellants shall be entitled to their cost.;


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