)) IN THE HIGH COURT OF GUJARAT AT AHMEDABAD APPEAL UNDER SECTION 109 No 8 of 1998 For Approval and Signature: Hon'ble MR.JUSTICE R.BALIA. ============================================================ 1. Whether Reporters of Local Papers may be allowed to see the judgements? Yes 2. To be referred to the Reporter or not? Yes 3. Whether Their Lordships wish to see the fair copy of the judgement? 4. Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? 3 to 5 No -------------------------------------------------------- PARAG SYNTEX PVT.LTD. Versus PARAG PRINTS PVT.LTD. -------------------------------------------------------- Appearance: MR MUKUL ROHATGI, SR. ADVOCATE, MR RR SHAH, MR.VINOD BHAGAT WITH MR HARSHIL R SHAH for Appellants MR P. CHIDAMBARAM, MR. BHARAT J. SHELAT, MR. JIMNY AWASIA, MR YJ TRIVEDI, MR. N.N. PRAJAPATI, MR. VIBHAVA SAWANT, MR. A.K. CHOKSHI of M/s Little & Co for Respondent No.1 -------------------------------------------------------- CORAM : MR.JUSTICE R.BALIA. Date of decision: 16 /11/98 C.A.V. JUDGEMENT 1. This Appeal under Sec.109 of the Trade and Merchandise Mark Rules, 1959 is against the order of Deputy Registrar of Trade Marks, Ahmedabad, dated 2nd April, 1998, by which the opposition filed by the appellant M/s Parag Syntex Private Limited to the Application No. 543105B of respondent No.1 `Paras Prints (P) Ltd., was rejected and the application for registering the label mark using word "PARAG" as its trade mark relating to business of manufacturing and marketing artificial silk sarees was granted. 2. The facts leading to this Appeal are that the application was filed by Harikishan Sunderlal Virmani as proprietor of "Parag Prints" for registration of word "PARAG" per se as its trade mark proposed to be used. The application was dated 28th December, 1990 and was filed on 7th January, 1991. The application was for registration of mark in Part-A of the Register in Class -24 in respect of goods artificial silk sarees and dress materials. The application was amended firstly on 8.12.1994 when the applicants name was substituted as `Parag Prints Pvt. Ltd.' as during this period said Virmani has assigned the mark in question with goodwill of the trade to the company which has been incorporated during this period and a registration was sought in Part-B instead Part-A of the register of trade marks. By second amendment, the mark was changed from word `PARAG per se' to Label mark with use of word `PARAG' in somewhat stylised form on 13.7.95. These two amendments were applied for and granted before the advertisement of the application. The third amendment was applied for on 13.12.1996 for substituting the proposed use to `user since 1989'. When the first time advertisement was published in Trademarks Journal No.1110 on 1st September, 1995, which was after the amendment of 13th July, 1995, it was for registration of word mark only. When the error was brought to the notice of the Registrar by letter dated 4th September, 1995, the error was corrected and label mark was advertised on 1st December, 1995. All the amendments were moved before and allowed by the Registrar at Bombay. 3. After the corrigenda was published in Trademarks Journal No. 1116 at page 2545 on 1st December, 1995, the opponents filed their notice of opposition with the Registrar on 26.12.1995 which was acknowledged by him on 10th January, 1996. The acknowledgment addressed to the opponent shows endorsement of copy to respondent No.1. Actual receipt of this intimation of acknowledgment of lodging of notice of opposition is in dispute by respondent. However, copy of the opposition was served on respondent No.1 only on 23rd December, 1996. On 25th December, 1996, respondent No.1 filed its counter statement. On 30th December, 1996, the opponents was directed to file evidence in support of opposition, which was not produced within the prescribed time. On 3rd March, 1997, though the opposition filed application for extension of time for filing evidence, the opposition was declared as abandoned as evidence has not been filed within the time allowed under Rule 53. So disposing of opposition, registration of the mark applied for was granted in favour of applicant company on 12th March, 1997 and certificate thereof was issued. Prior to that corrigenda amending the user to 1989 was published on 16.2.97 in TMJ No.1145 at page 1675. 4. Both the orders, viz. abondoning of opposition and grant of registration were challenged by way of Spl. C.A. No. 988 of 1997 before the Bombay High Court. The petition was filed on 2nd July, 1997. Reply to petition was file din July 1997 itself. In the reply facts about 3rd amendment were stated. The writ petition was disposed of by Bombay High Court in terms of order made on consent of the parties on 15.10.1997. The order reads as under : " Without prejudice of the respective contentions of the parties by consent of the petitioner and respondent No.5, the order dated 3.3.1997 passed by the 3rd Respondent in the matter of opposition No. AMD-1040 to the 5th Respondent's application No. 543105 is set aside for the registration of the mark is cancelled and the said matter is remanded back with the following directions: The petitioner shall filed its evidence in support of the said opposition under Rule 53 within 4 weeks from the date thereof. The 5th respondent shall file its evidence in support of application under Rule 54 within 2 months from the receipt of the petitioner's evidence under rule 53. The petitioner shall file its evidence in rebuttal under rule 55 within 1 month from the receipt of the 5th respondent's evidence under rule 54. The parties shall strictly adhere to the above schedule and will not ask for extension of time. The Registrar shall thereafter immediately hear and dispose off the matter on merits by assigning the matter to an officer other than respondent No.3. In any event, the Registrar shall dispose off the matter within 6 months from the date hereof. The passing of this order is not intended to be a reflection on the conduct of the respondent. The Registrar is directed to dispose off the matter strictly on merits without being any way influenced by passing of this order. Parties will bear their own costs." 5. In pursuance of the aforesaid order, the parties led their evidence before the Deputy Registrar. After completion of evidence, the present appellant moved three interlocutory petitions before the Registrar. First interlocutory petition was dated 18th March, 1998 in which the prayer was made to review the order of the Registrar allowing amendment on applicant's request, Form TM-16 dated 13.12.1996 for altering `the proposed user' to `users since 1989, for registration of trademark and to redecide the application for amendment after hearing the opponent. The ground was that the opponents had not been given notice of this application which was allowed after he has lodged his opposition. The second interlocutory application dated 19th March, 1998 was for directing the applicants to offer inspection of the documents listed in the petition, which was partly allowed and inspection was granted. No dispute has been raised in respect of the second interlocutory petition in this appeal. The third interlocutory petition was filed on 26th March, 1998 seeking direction of the Tribunal that Mr.S.K.Butani who has filed an affidavit deposing certain facts relating to the proceedings and other traders who have filed their affidavits in support of claim of user made by applicants be called for cross-examination. Keeping in view the time schedule prescribed by the High Court of Bombay in its above referred order and the fact that credibility of assertions made in affidavit was yet to be examined, the prayer for calling the opponents for cross-examination was refused. No challenge to this order has also been made. Thus, rejecting the interlocutory applications, the Deputy Registrar found that opposition has failed to prove its prior user of the mark "PARAG"; that the applicant has not been able to establish its user since 1989 but has established its user w.e.f. 21.12.1990. In view of these findings, the objection under Section 18 of the Act was over ruled as the prior user by the opponent was not proved and the first user and adaptation of word PARAG by the applicant was proved. The objection under Section 11 (a) was also rejected. Dealing with the objection under Sec. 9, the Deputy Registrar found that no evidence was produced to show that `PARAG' is a common personal name and that according to dictionary meaning `PARAG' means `Pollen'. On this premise, namely, the `PARAG' is not a common personal name and that `PARAG' has other known meaning than as a personal name and applying the principle that if the word were a less rare surname and yet not in any sense common surname, and had an overwhelmingly common and better known meaning otherwise than as surname, words such as "Jury" or "Burgler", the Registrar would in the absence of evidence of distinctiveness, refuse registration in Part-A but would allow registration in part-B of the register. The opposition on the ground of the conduct of the applicants in using the Letter `R' in a circle before registration, in the circumstances of the case, was not found sufficient to disentitle the applicants to registration by use of discretionary power of Register. On these findings, opposition was rejected and application was allowed and certificate of registration registering the label mark has been issued. Hence the present appeal. 6. In the first instance, it was urged by learned counsel for the appellant that as amendment in application about `user' has been allowed without notice of application to the opponent, notwithstanding the fact that amendment application in form TM16 was filed after opponent has lodged its notice of opposition, the order allowing amendment and consequential consideration thereof is invalid inasmuch as same is in breach of principles of natural justice. Learned counsel for the appellant places reliance on the decision of SL KAPOOR v. JAYMOHAN, AIR 1981 SC 136 that breach of principles of natural justice by itself is prejudice and no further prejudice is required to be proved. Learned counsel urges that he having made an objection to that effect before the application for registration was heard and decided by way of interlocutory petition dated 18th March, 1998, the Dy. Registrar has erred in not allowing the objection notwithstanding the finding that the application of the amendment has been allowed without notice to the appellant on the ground that he has not availed the statutory remedies against it and he cannot consider the same as an appellate authority. 7. Having carefully considered the contention, I am of the opinion that in the facts and circumstances of the present case it cannot prevail. 8. Section 109 allows appeal against every order passed by the Registrar under the Act, except the decision, order or direction issued under the Act by the Central Government and such directions issued by the Registrar in implementing such decisions, order or direction of the Central Government under the Act or Rules before the High Court. While hearing the appeals under Section 109, provision of the Code of Civil Procedure, 1908 have been made applicable specifically except to the extent there are provisions to the contrary in the Act of 1958 or rules made thereunder. Section 99 of the Code, inter alia, provides that no decree shall be reversed or modified for error or irregularity not affecting merits or the jurisdiction of the court. Therefore, before the order made by the Dy. Registrar is to be set at naught on the ground of any defect or irregularity in making any interlocutory order, the court has to be satisfied whether such irregularity or defect has affected or is likely to affect the merits of the case or it affects the jurisdiction of the court to try the lis itself. It is not the case that the Dy. Registrar had no jurisdiction to entertain and allow the amendment or the application for registration. The question, therefore, arises whether the application dated 13.12.1996 which has been allowed without notice to the opposition by itself would be sufficient to set at naught the final order. It is well settled that rules of natural justice are subject to statutory provisions and where the procedures of hearing are not governed by statutory provisions, it depends on facts and circumstances of each case to what extent the principles of natural justice are required to be followed in each case. As noticed above, in the present case, the procedure to be followed by appellate court is governed by statutory provisions, namely, the Code of Civil Procedure, except to the extent otherwise provided in the Act of 1958 and the Code of Civil Procedure unequivocally provides that the decree or order of the court below is not to be reversed, modified or remanded solely on the basis of defect, error or irregularity in procedure except in case it has affected the merits of the case. Adherence to principles of natural justice is a matter of procedure to ensure fair trial. It does not fall in the realm of merit of case. Amendment of pleadings is part of procedure. If there is any irregularity or illegality in allowing or refusing amendment of pleadings, the same by itself will not affect the merit of the case. The question will be whether such dealing with amendment of pleadings has materially affected the trial of the case on merit to the prejudice of objector. If the trial has proceeded on the basis of amended pleadings, of which the other side had no notice and he has been prejudiced in conducting his case, obviously, the ultimate order on the strength of such trial shall be vitiated. On the other hand, notwithstanding that when amendment was allowed, the other side was not served with notice, but later on after the fact has been brought to his notice, he participated in trial, led evidence on that basis without demur, it cannot be said that because of an illegality or irregularity in allowing amendment, ultimate merit of trial order has been affected. 9. A breach of principles of natural justice vitiates a trial not because order is bad on merit, but because it defiles a fair procedure and leaves room for arbitrary or biased decision. Stress on adherence to principles of natural justice is not so much part of duty to act judiciously but is foundation for duty to act fairly. But as noticed, these principles are subject to statutory provisions and cannot override the same. Therefore, before the final order can be invalidated, the court will have to examine whether the allowance of amendment application has resulted or likely to affect the merit of the case. In the facts and circumstances of the present case, it is to be seen how far the breach has affected the merit so as to warrant interference by the appellate court. For this purpose, it would be profitable to recount certain facts. 10. The application was moved on 13.12.1996 for amending the user from `proposed' to `since 1989'. As on 13.12.1996, the applicant was not served with the copy of the notice of opposition. What is now being alleged is that he has information about the filing of the opposition by pointing out the endorsement made in the acknowledgment letter of the receipt of notice of opposition by the Registrar, notwithstanding that the copy was not served on the opponent. The application was filed at Bombay as were the earlier application. The orders were made without informing the applicant and they had no occasion to oppose the amendment. It is true that the opponents have not been afforded an opportunity to oppose the application for amendment, but, at the same time, amending an application for registration by itself does not create any right in favour of any one or against any one. It is like permitting a litigant to raise additional or alternative plea in support of its claim. The real crux is whether the opponent had an opportunity to answer the alterative or additional ground raised or put forth before it is considered and decided, resulting in a final order affecting the rights of the parties. The principle which is applicable to making of orders or finally determining the rights of the parties affecting them adversely cannot be imported with strait jacket in the situation like the present one. It is to be seen that first two amendments had been made even before application was advertised and they were made at Bombay. The application was advertised for the first time in September 95 and corrigenda was issued on 1st December, 1995. Notwithstanding, acknowledging the receipt of notice of opposition, the copy of the same was not served on the applicant until 26th December, 1996 and no hearing has been fixed at Ahmedabad or intimation has been given for transferring the proceedings from Bombay to Ahmedabad where the application had been initially filed. Bombay office is responsible for examining the applications, whether the application is acceptable or not while scrutinising in the light of preexisting trademarks and other material before it. Therefore, merely from the fact that application has been moved at the Head Office by itself could not be a ground to draw inference of any doubtful conduct against the applicants. It was for the Registrar who was dealing with the application, to have been vigilant and before deciding upon it ex parte to have secured service of the copy of the same on the opponent by directing the applicant to do so. This defect in procedure has been accepted to be there by the Dy. Registrar while considering the application for reviewing its order allowing amendment dated 13.12.1996. The fact remains that after allowing the application, it was published in the Trade Mark Journal, that is to say objections to amended applications were required to be filed, if any, from the date of such publication. That is to say, opportunity to object the allowance of the application for registering the trade mark on the amended ground was not denied to the applicant. He could have lodged objection to the allowablity of the registration of mark on the `user of mark since 1989' as was claimed by way of amendment. 11. It may be viewed from another angle that an independent application could have been moved on the basis of user notwithstanding itself effective. The same could not have been refused consideration for acceptance or advertised before acceptance for want of notice to the opposition. 12. Apart from this, the further conduct of the parties go to show that both the parties were fully alive to the issue, namely, that the registration of the trademark which is being considered on merit is on the basis of users since 1989 and both the parties have led evidence on that basis. The facts which emerge from the record and cannot be disputed are that on 3rd March, 1997 the opposition was rejected as abandoned. On 12th March, 1997 certificate was granted in favour of present respondent No.1 on 1st July, 1997, the appellant filed writ petition in Bombay High Court being Spl. C.A. No. 988 of 1997 challenging the registration granted in favour of the applicant and order as to abandonment of opposition. In reply to that petition it was brought to the notice of the present appellant that by third amendments in Form No. TM-16 was to incorporate the statement to user since 1989. The appellant applied for the copy of TM-16 Form dated 13.12.1996 through his request dated 31st July, 1997 which was granted on 5th August, 1997. Thus, appellants were aware about the amendment in the application at least by 31st July, 1997. After having known about this, they obtained consent order from the Bombay High Court in terms stated above. The direction was clearly to fix the time schedule for leading evidence by both sides as per the case known to them and to Registrar to dispose of the matter on merits by assigning the matter to an officer other than the respondent No.3 before the Bombay High Court . Thus, it can well be said that when by consent the parties obtained the order from the Bombay High Court on 15th October, 1997, for leading evidence and decision of the application on merit, the appellant was aware about what case he has to meet, namely the amended application as to its user since 1989. In fact, evidence has been led on that basis. Law is also trite that where parties are aware about the real issue and led evidence on that basis even absence of a formal framing of issue does not vitiate the trial. In the present circumstances when parties having come to know about the amendment which has been allowed without notice to them, agreed to lead evidence on merit of the case and to secure decision on the merits of the case, cannot now be permitted to turn round to say since there is irregularity or defect in allowing amendment, the final order ought to be set at naught. As appellant being aware about the amendment since at least July 31, 1997, he after obtaining the consent order to go along with the trial by leading evidence and getting decision on merit, he must be deemed to have consented to lead evidence and secure decision on merit on the basis of facts existing on that date as per record and not to vitiate the trial by irregularity or defect in procedure interior to that date. Therefore, in considering the evidence on the basis of amended application which was led only after 15.10.97 pursuant to order of Bombay High Court, cannot be considered to have prejudiced the merit of the case so as to warrant interference by appellate court on that ground. The contention, therefore, on account of defect or irregularity in allowing the amendment of user in application for registration of trade mark is rejected. 13. The second objection which is raised for the first time now is that on the date the second amendment was allowed on 13th July, 1995 for substituting the word `PARAG' with label mark representing word `PARAG' in stylised form `PARAG Prints Pvt. Ltd.' was not the proprietor of the mark. Hence, it could not have made the application nor the same could have been allowed. This being a question not raised before the lower Tribunal during the course of proceedings, the appellant is not entitled to raise the same for first time in appeal as a matter of right. The contention which is raised is that as on the date application was made for substituting the label mark, the applicant `Parag Prints Pvt. Ltd' has assigned its rights in the trade mark in favour of Parag Industries Pvt. Limited on 1st April, 1995. As on 13th July, 1995, Parag Prints Private Limited was not even claiming to be the proprietor of mark, it has no locus to apply for amendment either and, therefore, no competent application for label mark was there which required consideration by the Registrar for registration. As stated above, this being the primary question of fact, cannot be permitted to be raised for the first time in the appellate stage. 14. Section 41 envisages assignment of trade mark registered or unregistered with or without assigning of good will of the business becomes operative only when an application for its registration is made within six months of such assignment or within such extended period not exceeding three months as may be permitted by Registrar for direction with respect to advertisement of the assignment. That is to say, in absence of advertisement of assignment in case of unregistered trade mark without transfer of goodwill, the assignment fails. No material has been shown to be on record about these facts. It cannot be said therefore that from record a finding as to valid and operative