(PER : HONOURABLE MR.JUSTICE JAYANT PATEL) 1. The present appeal is directed against the judgement and order passed by the learned Single Judge of this Court in Civil Suit No.4 of 2012, whereby the learned Single Judge has allowed the application and has issued direction that the defendant – appellant herein, his servants, agents, dealers and distributors are restrained by order of temporary injunction from manufacturing, marketing and using the registered design of Ductable air-conditioners of the plaintiffs, till the final decision of the suit or till such time as the registration thereof remains intact.
2. The short facts can be described in the same manner, as was considered by the learned Single Judge at paragraph 5 of the impugned order, as under:-
“1. The plaintiffs, namely Mr.Paresh D.Patel (plaintiff No.1) and Vardayini Power Private Limited (plaintiff No.2) filed Regular Civil Suit No.96 of 2012 in the City Civil Court at Ahmedabad, praying for grant of a permanent injunction restraining the defendant, their servants, agents, dealers and distributors from manufacturing, marketing and using their design registered under No.230537 in Class 2304 on 29.07.2010, in respect of Ductable air conditioners and/or any unit/ product/ air conditioner, which is having similar type and configuration or material reproduction of the plaintiffs' registered design. The plaintiffs have also prayed for grant of a permanent injunction restraining the defendant from printing, publishing, using, marketing, copying or imitating the design of Ductable air conditioner, its drawings and parts thereof, and to restrain them from committing infringement of the plaintiffs' Registered design.
2. The plaintiffs have moved an application for grant of temporary injunction, interalia, making a prayer to restrain the defendants, their agents, servants, dealers and distributors from manufacturing, marketing, using, printing, publishing, copying or imitating the design of Ductable airconditioners, its drawings and parts thereof, and from committing infringement of the plaintiffs' registered design.
3. The City Civil Court passed an order for appointment of a Court Commissioner for carrying out local inspection of the suit property and submission of the Report. The Court Commissioner filed his Report dated 13.01.2012. The defendant filed an objection to the grant of temporary injunction in favour of the plaintiffs and challenged the design of the plaintiffs. The plaintiffs, therefore, preferred an application at Exhibit 21 under Section 22(4) of the Designs Act, 2000 (“the Act” for short), praying for transfer of the suit to the High Court. The defendant contested the said application by filing an affidavitinreply at Ex.22. By order dated 29.02.2012, passed below Ex.21, the City Civil Court concluded that the defendant has set up a defence as available under Section 19 of the Act and transferred the suit to this Court, where it has been renumbered as Civil Suit No.4 of 2012.”
3. The learned Single Judge has, after considering the evidence available on record, prima facie, found that the design of the original plaintiff, which is registered under The Designs Act, 2000 (hereinafter referred to as ‘The Act’ for short), is being breached by the provisions of Section 22 of the Act by the original defendant and, therefore, ultimately for the reasons recorded in the order, passed the impugned order. It is under these circumstances, the present appeal before this Court.
4. We have heard Mr.Percy Kavina, learned Sr. Counsel appearing with Mr.Barot, learned Counsel for the appellant – original defendant and Mr.Shalin Mehta, learned Sr. Counsel appearing with Mr.Oza, learned Counsel for the respondents – original plaintiffs.
5. As such, the scope of judicial scrutiny in the appeal at the stage of application for temporary injunction in a suit under the Act is by now well settled. If possible view is taken by the learned Single Judge, it may not be a case for interference in the appeal, more particularly when the discretion could not be said as improperly exercised. However, if the view take by the learned Single Judge is impossible, it may call for interference in exercise of the appellate power. It is true that while sitting in appeal, the Division Bench of this Court enjoys all powers as they were available to the learned Single Judge, including that of appreciation of evidence, but at the same time when the matter is at the stage of temporary interim injunction below an interim application, the aforesaid broad parameters of scope of judicial scrutiny could be borne in mind while considering the contentions of the learned Counsel appearing for both the sides.
6. The first contention raised by the learned Counsel appearing for the appellant was that it is no design in the eye of law and the product or the design registered under the Act would fall in the category of exception as carved out under Section 2(d), inasmuch as it is only a mere mechanical devise, which has been altered by the plaintiff in the ducted air- conditioner and it does not meet with the requirement of appealing to an eye. He submitted that if the essential purpose is to change the mechanical devise for the utility, it is no design in the eye of law and it could not have been registered by the Registering Authority. It was also submitted that all grounds, which are available for cancellation of the registration under Section 19 can be invoked in defence as per Section 22(4) of the Act. He submitted that if it was not a design to be registrable under the Act, the benefit of the registration would not be available to the plaintiff and consequently the injunction ought not to have been granted by the learned Single Judge.
7. It prima facie appears that Section 2(d) of the Act does carve out an exception if it is a mere mechanical devise and has no appeal to the eye. In order to appreciate the contention further, it should be borne in mind that the design of ducted air-conditioner, for which the registration is made by the original plaintiff has the utility in event organization, functions and halls. The appearance or the look of the ducted air-
conditioner, which is to blow cooled air has a role to play. If the said aspect is considered, keeping in view the position prevailing as per the old design and the new design, there is notable difference and the same is that in the old design the blower did exist but simultaneously the pipes and wires were shown as hanging and the suction of the return air was from outside, whereas in the new design only blower is exhibited inside the hall and the suction of return air is from the bottom of the hall itself. Wiring or pipes are outside as per the mechanism of new design for providing ducted air-conditioner. Therefore, if both photographs are considered as on page 43 with page 656, 658 and 660, it does prima facie show that it would better be suited to the eye for the purpose for which it has the utility and, therefore, if the eye is the only judge, one would be attracted by the new design. It is true that it is not a matter where the design includes only aesthetic view of the ducted air-conditioner, but the mechanical devise is also altered. Therefore, when it is an alteration or the specific mechanical devise, which appeal to an eye even by an external appearance, it cannot be said that it is no design, which is registrable under the Act.
8. The learned Counsel for the appellant next contended that when the design prior to the registration was already published, it could not be registered by the concerned authority and, therefore also the same would stand covered by the ground available under Clause (b) of Section 19 by way of defence in the present suit to the defendant. It was submitted that as per the averments made by the plaintiff in the plaint, the advertisement was made of the design and the plaintiff has procured the business based on the same. When the publication was made, then the registration was not made available and, therefore, it could not be considered as a valid design conferring the benefits to the plaintiff for the interim injunction. In furtherance to the submission, the learned Counsel for the appellant relied upon the averments made at paragraphs 11, 12 and 13 of the plaint, whereas, as per the original plaintiff – respondent herein, the figure shown is composite in nature since the plaintiff was already in business and the process of advertisement was for various purposes. It was submitted that it is no publication, which prohibits the registration and, therefore, the learned Counsel for the respondents submitted that the discretion has been properly exercised by the learned Single Judge.
9. In our view, as such the publication presupposes the publication to be made by making known to the public at large and more particularly the consumers thereof. It is true that the figures of advertisement expenses are mentioned and a general statement is made for expenses incurred for advertisement, including the design, but no material has come on record showing the publication, in any manner, like that of a circulation through pamphlets or any paper advertisement or otherwise. It deserves to be recorded that when the design is registered by the Registering Authority, who is considered as an expert in the field the normal presumption would be that the registration is made in proper manner. If one is contending by way of defence that the registration was not available for one reason or another, the burden would be upon the party so asserting. If the defendant is raising the contention of prior publication, the burden would be open the defendants. No material is produced by the defendants for such purpose. The contention raised on the basis of the averments made by the plaintiff in the plaint, per se, cannot be said as publication, which is barring the registration. In our view, unless a full-fledged fact finding inquiry is undertaken and parties are allowed to lead the evidence, it is not possible to conclude that there was publication of the design as required under the Act prohibiting the registration of the design. Be it noted that it is not a matter where the suit is to be concluded after an elaborate evidences led by the parties, but we have to consider the matter at the stage when the interim application for temporary injunction is considered by the learned Single Judge and the matter is to be examined in appeal. Therefore, prima facie material is only to be taken into consideration as available on record. If prima facie once the design is registered and no reliable material has come on record showing the publication by making it known to the public at large or the consumers of an article, it cannot be said that there was publication of an article with new design prohibiting the registration of the design on the date when the registration was applied. Therefore, the said contention does not deserve to be accepted.
10. The learned Counsel for the appellant lastly contended that even if the provisions of Section 22(1) of the Act are taken into consideration it applies to a sale of any article with the design and it is not applicable to the services being rendered on rental basis by the defendants. It was submitted that the learned Single Judge in any case ought to have gone into the said aspect and expressed the view that whether the act of rendering service on rental basis by making use of the article could be said as prohibited by Section 22(1) of the Act or not. In the submission of the learned Counsel for the appellant, the learned Single Judge has not examined the said aspect by deferring the same to the final hearing. It was submitted that when it was an admitted position that the plaintiff as well as the defendants both are dealing in rendering services on rental basis to event organizers, those who are hiring hall etc., for a particular function or otherwise, it was required for the learned Single Judge to express the view by examining the said aspect. It was also submitted that if the said aspect is not examined, the matter could be remanded to the learned Single for consideration of the same.
11. Whereas, Mr.Mehta, learned Sr. Counsel appearing for the respondents submitted that it is true that the learned Single Judge has not examined the said aspect while passing the impugned order, but this Court sitting in appeal may examine the same, since the Division Bench of this Court enjoys all powers as that of the learned Single Judge while deciding the interim injunction. He submitted that the principles of purposive interpretation are required to be made as rather been indirectly considered by the learned Single Judge, otherwise it would leave room for mischief to be played by the law-breakers, who are committing breach of the Act. It was submitted that if the prohibition of the design with the commercial purpose or commercial interest is not read under Section 22(1), it may frustrate the object of the Act and it will also leave room for any person to indulge into the mischief, inasmuch as one may not sell an article with the same design, but he may give it on rental basis or on hire purchase or otherwise by earning profit thereof or with the element of commercial interest. He submitted that therefore if the purposive interpretation is made, it would mean that type of commercialization by way of sale or by making use of the article by way of service on rental or on hire purchase or otherwise, should stand included in the prohibitory clause. In the submission of the learned Counsel for the respondents, the injunction has been properly granted by the learned Single Judge, even if the aspect is examined by this Court in appeal.
12. It is hardly required to state that it is not even the case of the defendants that the article is used for his own purpose or personal use. It is the case of the defendants and rather on that aspect there is no dispute that the defendants are not to use the article on rental basis at the time when the events are organized in any hall or for the purpose of function or organizing any function, etc. We do find substance in the contention that if the sale is to be considered as provided under the sale of Goods Act of any article, it would leave room for the mischief, inasmuch as one may not prepare invoice for sale, but may give it on rental basis or on hire purchase of article. The ultimate effect would be that the commercialization or the commercial use of the article for the same design is permitted. If the mischief is to be curbed, it would call for the purposive interpretation by the Court for enforcement of law. The essential purpose of the The Designs Act is to protect the rights of intellectual property of any person, who has prepared a design and is registered under the Act. Section 22(1)(a) for ready reference can be reproduced as under:-
“22.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 of 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”
13. The bar of application of the design to any article is operating, unless the licence or written consent is there of a registered proprietor, but the language used is ‘to do anything with a view to enable the design to be so applied.” One view is that such words ‘to do anything with a view to enable the design to be so applied” should be made applicable to the article, which is for the purpose of sale, but the another view could be that if one is to do anything for application of the design, the licence or the written consent of the registered owner is a must. Such ‘anything’ for application of the design would include any action for applying the design for the purpose of deriving profit or for realizing the commercial interest. There are various modes of sale of an article, which is by now well known and prevailing in the commercial field. One mode is to outright sale of an article by transferring the full ownership. The another is to sell with the agreement on higher purchase and the third is to realize the commercial interest or to realize the benefits of the investment of the article. If the article is with the same design and is being used, may be on rental basis with the element of profit or otherwise, in our prima facie view, keeping in view the object of the Act for protecting the rights of intellectual property, the bar of Section 22 could be applied by giving purposive interpretation, so as to ensure that there is no room available for playing mischief with the object of he Act for protecting the rights of intellectual property.
14. At this stage we may refer to the decision of the Apex Court in the case of Bharat Glass Tube Limited v. Gopal Glass Works Limited, reported in (2008) 10 SCC, 657. In order to better consider the purpose of the Act, more particularly the observations at paragraph 26 are reproduced as under:-
“26.In fact, the sole purpose of this Act is protection of the intellectual property right of the original design for a period of ten years or whatever further period extendable. The object behind this enactment is to benefit the person for his research and labour put in by him to evolve the new and original design. This is the sole aim of enacting this Act. It has also laid down that if design is not new or original or published previously then such design should not be registered. It further lays down that if it has been disclosed to the public anywhere 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, or where applicable, the priority date of the application for registration then such design will not be registered or if it is found that it is not significantly distinguishable from known designs or combination of known designs, then such designs shall not be registered. It also provides that registration can be cancelled under section 19 of the Act if proper application is filed before the competent authority i.e. the Controller that the design has been previously registered in India or published in India or in any other country prior to the date of registration, or that the design is not a new or original design or that the design is not registerable under this Act or that it is not a design as defined in clause (d) of section 2. The Controller after hearing both the parties if satisfied that the design is not new or original or that it has already been registered or if it is not registerable, cancel such registration and aggrieved against that order, appeal shall lie to the High Court. These prohibitions have been engrafted so as to protect the original person who has designed a new one by virtue of his own efforts by researching for a long time. The new and original design when registered is for a period of ten years. Such original design which is new and which has not been available in the country or has not been previously registered or has not been published in India or in any other country prior to the date of registration shall be protected for a period of ten years. Therefore, it is in the nature of protection of the intellectual property right. This was the purpose as is evident from the statement of objects and reasons and from various provisions of the Act. In this background, we have to examine whether the design which was registered on the application filed by the respondent herein can be cancelled or not on the basis of the application filed by the appellant. In this connection, the law of Copyright and Industrial Designs by P. Narayanan (Fourth Edition), Para 27.01 needs to be quoted.
"27.01. Object of registration of designs. The protection given by the law relating to designs to those who produce new and original designs, is primarily to advance industries, and keep them at a high level of competitive progress.
" Those who wish to purchase an article for use are often influenced in their choice not only by practical efficiency but the appearance. Common experience shows that not all are influenced in the same way. Some look for artistic merit. Some are attracted by a design which is a stranger or bizarre. Many simply choose the article which catches their eye. Whatever the reason may be one article with a particular design may sell better than one without it: then it is profitable to use the design. And much thought, time and expense may have been incurred in finding a design which will increase sales". The object of design registration is to see that the originator of a profitable design is not deprived of his reward by others applying it to their goods.
The purpose of the Designs Act is to protect novel designs devised to be applied to (or in other words, to govern the shape and configuration of) particular articles to be manufactured and marketed commercially. It is not to protect principles of operation or invention which, if profitable at all, ought to be made the subject matter of a patent. Nor is it to prevent the copying of the direct product of original artistic effort in producing a drawing. Indeed the whole purpose of a design is that it shall not stand on its own as an artistic work but shall be copied by embodiment in a commercially produced artefact. Thus the primary concern, is what the finished article is to look like and not with what it does and the monopoly provided for the proprietor is effected by according not, as in the case of ordinary copyright, a right to prevent direct reproduction of the image registered as the design but the right, over a much more limited period, to prevent the manufacture and sale of article of a design not substantially different from the registered design. The emphasis therefore is upon the visual image conveyed by the manufactured article.”
15. In view of the aforesaid, we find that even if the contention is examined, of the appellant – original defendant the same is devoid of merit and hence, no useful purpose would be served in remanding the matter to the learned Single Judge for examining the said aspect.
16. In view of the aforesaid, after taking into consideration, the reasons recorded by the learned Single Judge, we find that it cannot be said that the view taken by the learned Single Judge by exercising the discretion is an impossible view, but could be rather said a possible view, which the learned Single Judge has taken and based on the same, the interim injunction has been granted. Therefore, we find that the appeal is meritless and deserves to be dismissed.
17. However, before parting with, we need to observe that since the contentions were raised in the present appeal, we have expressed our view. Such view is only prima facie and ultimately it will be for the learned Single Judge to finally decide the suit on the basis of the evidence available before him. Therefore, suffice it to state that any observations made by us in the present judgement shall not prejudice, in any manner, the rights of the parties at the time of final conclusion of the suit and the learned Single Judge shall be at liberty to take independent view of the matter on the basis of the evidence available before him/her without being, in any manner, influenced by any observations made by us in the present judgement.
18. Subject to the aforesaid observations, the appeal is dismissed.
Considering the facts and circumstances, no order as to costs.
19. After the pronouncement of the order, Mr.Barot, learned Counsel appearing for the appellant prays that the interim injunction was granted by the Division Bench of this Court pending the appeal and, therefore, in order to enable his client to approach before the higher Forum, the same may be continued for a period of six weeks. Such prayer is opposed by Mr.Oza, learned Counsel, contending that when this Court has found that there is no merit in the appeal, stay may not be granted.
20. Considering the facts and circumstances, the interim stay granted pending the appeal shall continue till 4.1.2013.
(JAYANT PATEL, J.) (MOHINDER PAL, J.) vinod