IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE FIRST DAY OF MAY TWO THOUSAND AND EIGHT PRESENT HON’BLE Mr. JUSTICE R.SUBHASH REDDY WRIT PETITION No.16848 of 2007 Between: 1. Krishna District Milk Producers Mutually Aided Cooperative Union Ltd., (for short KDMPMACU Ltd.,) rep. by its Chairman Mr. M. Janakiramaiah S/o. Rattaiah. 2. Krishna District Milk Producers Mutually Aided Cooperative Union Ltd., (for short KDMPMACU Ltd.,) rep. by its Managing Director Mr.T.Babu Rao S/o. T.V. Chalapati Rao, Aged about 57 years, Milk Products Factory, Lambadipet, Vijayawada, Krishna District. ... Petitioner AND 1 Government of A.P. rep. by its Secretary, Animal Husbandry Department, Secretariat, Hyderabad. 2 A.P. Dairy Development Cooperative Federation Ltd., Rep. by its General Manager (Marketing), Lalapet, Hyderabad-17. 3 Milk Commissioner and Registrar of Milk Cooperatives, A.P.D.D.C.F.Ltd., Lalapet, Hyderabad-17. 4 Registrar of Cooperative Societies, Hyderabad. ...RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court may be pleased to issue a writ order or direction more particularly one in the nature of writ of MANDAMUS, declaring that the orders of the Government in the form of minutes by the Minister of its Executive dated 27-07-2007 and the directions of the Government-Society APDDCFLtd., dated 09-07- 2007 are void, illegal, arbitrary and unconstitutional as opposed to the provisions of the Constitution and law. Counsel for the Petitioner: Mr. B.V.SUBBAIAH Counsel for Respondent No.1: GP FOR ANIMAL HUSBANDARY Counsel for Respondent Nos.2 & 3: Sri S.S. Prasad Counsel for Respondent No.4: G.P., Cooperation The Court made the following: Order: The Krishna District Milk Producers Mutually Aided Cooperative Union Ltd., represented by its Chairman and Managing Director, has filed this writ petition seeking Mandamus to declare the Minutes of the meeting dated 27-07-2007 chaired by the Hon’ble Minister for Animal Husbandry and Dairy Development, Government of Andhra Pradesh, and the communication dated 09-07-2007 issued by the second respondent, A.P. Dairy Development Cooperative Federation Ltd., whereby directions were issued not to use the brand ‘Vijaya’ unless Memorandum of Understanding is entered into with the second respondent Federation, as illegal and arbitrary. 2. The petitioner society was initially registered under the provisions of the Andhra Pradesh Cooperative Societies Act, 1964. But, however, after coming into force of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, it was converted and registered as such on 10-07-2001 under Section 4 of the said Act and certificate of registration was issued under Section 5 of the Act. When the petitioner society was functioning as a society under the Andhra Pradesh Cooperative Societies Act, 1964, it was a member in the second respondent Federation, which is also a society and an Apex body. After its conversion into a society under the provisions of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, when an attempt was made to cancel its very registration, it had approached this court by W.P.No.23848 of 2004, questioning the jurisdiction of the Registrar in cancelling such registration and it is stated that the petitioner had succeeded in the said writ petition. Further, in the year 2006, Ordinance No.2 of 2006 was issued, amending Section 4 of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, for exclusion of all Dairy Milk Cooperative Societies from the provisions of the said Act, with a deeming provision to the effect that they are deemed to have been registered under the Andhra Pradesh Cooperative Societies Act, 1964. The said ordinance culminated into Act 20 of 2006, which was also subject matter of challenge before this court in a batch of writ petitions in W.P.Nos.2214 of 2006 and batch, in which petitioner herein is one of the parties. A Division Bench of this court considered the issue elaborately and by order dated 01-05-2007 struck down the very validity of Act 20 of 2006, declaring it as unconstitutional. 3. The grievance of the petitioner society is that after it was converted and re- registered as a society under the provisions of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, with dint of hard work and discipline, it has developed its business and at that stage, there was interference with its business by the second respondent Federation as well as the Government. It is stated that respondents were objecting for use of brand name ‘Vijaya’ for the milk products being manufactured and sold by the petitioner society and when a notice was issued in this regard on behalf of the Federation, it was duly replied by the petitioner society and in spite of the same there is illegal interference with the business of the petitioner society. It is stated that when the petitioner society was exporting its products, which are being manufactured and sold in the brand name of ‘Vijaya’, to other states, the transport trucks carrying the said products were obstructed and seized on the instructions of the Government officials, at the instance of the second respondent Federation. Such instances of seizure were referred to in the affidavit filed in support of the writ petition. It is also the grievance of the petitioner society that in the meeting conducted in the presence of the Hon’ble Minister for Animal Husbandry and Dairy Development, Minutes dated 27-07-2007 were recorded, in the absence of the consent of the petitioner, to the effect that petitioner cannot sell its products outside Krishna District by using the brand name ‘Vijaya’. It is stated that A.P. Dairy Development Cooperative Federation Ltd., is a Government organization and the petitioner society, along with other societies, were its constituent members. It is further stated that in view of the conversion and registration of the Milk Cooperative Societies under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, which Act is intended to give more autonomy to the societies, respondents cannot interfere with and interdict the business of the petitioner society, under the guise of using the brand ‘Vijaya’. 4. Counter affidavit is filed on behalf of the respondents. While generally denying various allegations made by the petitioner, it is stated that registration of the petitioner society under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995 was conditional, the condition being that it should not be in possession of any Government assets, land, building and machinery and that it should enter into a Memorandum of Understanding with the Corporation. It is stated that the petitioner society has not complied with these conditions. The allegation of the petitioner that entire loan amounts were discharged to the Government and the Corporation is denied by the respondents. In the counter affidavit, it is stated that prior to 1974, all the dairy development activities in the State were under the control of the Government of Andhra Pradesh, but, however, after the formation of A.P. Dairy Development Corporation Ltd., the Government has transferred entire assets and infrastructure to the Corporation with effect from 02-04-1974 vide G.O.Ms.No.80 dated 15-04-1974. It is stated that A.P. Dairy Development Corporation Ltd., was formed under the Andhra Pradesh Cooperative Societies Act, 1964, to cover all the dairy activities in the State in the Cooperative sector. It is further stated that a three- tier cooperative structure was organized, i.e. primary societies at village level, milk unions at district level and Cooperative Societies at State level, which are Apex bodies. It is stated that in pursuance of the orders of the Government in G.O.Ms.No.551 dated 10-12-1980, the Corporation has concluded Transfer Agreement, Loan Agreement to each of the diary milk units separately and based upon the same, the Government has accorded permission to the Corporation to hand over the management of the respective Units and dairies under its control to District Milk Unions through various G.Os. It is further stated that petitioner society came into existence and got registered under the Andhra Pradesh Cooperative Societies Act, 1964 and the Milk Products Factory, Milk-chilling centers, Cattle Feed Plant and allied dairy infrastructure has been under the control of the Federation and after formation of the society at the District level, assets were kept under the management of the petitioner through a Transfer Agreement entered between the Managing Director of the Federation and the petitioner Union. While referring to the circumstances which led to issuance of Ordinance No.2 of 2006, it is stated that the Andhra Pradesh Dairy Development Cooperative Federation Ltd., is involved in the manufacture of various traditional dairy products and also wide range of value added products in the brand name of ‘Vijaya’. It is further stated that the brand name ‘Vijaya’ and its logo were registered under the provisions of the Trademark and Merchandise Act, 1958 and they are the exclusive property of the Federation. It is also stated that without entering into agreements for using the brand name ‘Vijaya’, after getting re-registered under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, it is not open for the petitioner to use the brand name ‘Vijaya’ for its products, without the consent of the Federation. In the counter affidavit, it is also stated that as the petitioner was carrying on business by using the said brand name clandestinely and unauthorizedly, it was brought to the notice of the District Collector, Krishna District and the trucks that were carrying the products of the petitioner were seized. It is further pleaded that after the District Unions were formed under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, it was resolved that unless such unions entered into Memorandums of Understanding with the Federation, the brand name ‘Vijaya’ cannot be permitted to be used by them and such usage of the brand name ‘Vijaya’, which is the exclusive property of the Federation, is contrary to the provisions of the Trademark and Merchandise Act, 1958 and also various agreements entered into. 5. A reply affidavit is also filed by the petitioner stating that, earlier, manufacturing activity of the products of the petitioner was in the brand name of ‘Vijaya’ and as much as all the District Unions were working under the Apex Body at that point of time, they were permitted to manufacture and sell their products in the brand name of ‘Vijaya’ and in view of the said permissive usage, the respondent Federation cannot claim exclusive right over the brand name ‘Vijaya’. 6. Heard Sri B.V. Subbaiah, learned counsel for the petitioner, Sri S.S. Prasad for the second respondent Federation and also learned Government Pleader for Cooperation. 7. It is contended by Sri B.V. Subbaiah, learned counsel for the petitioner, that the impugned Minutes are recorded contrary to the interests of the petitioner Union even in the absence of its consent, merely referring to the participation of its Chairman. It is submitted that the contents were not agreed and therefore by reducing the same into a Resolution, which did not contain the signatures of the authorized signatories of the petitioner Union, respondents cannot issue such Minutes and interfere with the business of the petitioner. It is further submitted that though the petitioner was a District-Level Union during the period when it was functioning as a society under the Andhra Pradesh Cooperative Societies Act, 1964, but once it was registered under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, it became autonomous and it was no more under the control of the Federation. It is contended that, in that view of the matter, there is no right or any authority for the respondents to interfere and obstruct the business of the petitioner, which was developed on its own. It is submitted that, in any event, respondents have no authority to use the official machinery to stop the vehicles/trucks which are being used by the petitioner society for transporting manufactured products, in the brand name of ‘Vijaya’, outside the State of Andhra Pradesh. Learned counsel for the petitioner had placed reliance on a judgment of the Supreme Court in the case of Himmatlal Harilal Mehta Vs. State of M.P. and others, in support of his argument that respondents cannot take coercive steps to obstruct the business of the petitioner society. He has also placed reliance on two other judgments in the case of Narendra Kumar and others Vs. The Union of India and others a n d The District Collector of Hyderabad Vs. M/s. Ibrahim and Co.. 8. On the other hand, it is contended by Sri S.S. Prasad, learned counsel appearing for the respondent Federation, that the brand name ‘Vijaya’ and its logo are the exclusive registered property of the Federation and the petitioner has no authority to use the said brand name. It is submitted that though Memorandums of Understanding were to be entered into, for using the said brand name, but even without entering into such agreements, after re-registration under the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, petitioner is manufacturing dairy products illegally, in the brand name of ‘Vijaya’, which is the exclusive property of the Federation, and hence instructions were issued in this regard. It is submitted that in view of the availability of effective alternative remedy under the provisions of the Trademark and Merchandise Act, 1958, and in view of several factual disputes, petitioner cannot seek any directions by way of Mandamus from this court in this petition filed under Article 226 of the Constitution of India. In support of his argument that an aggrieved party can take recourse to civil and criminal proceedings, learned counsel has placed reliance on a judgment of this court in the case of Sri Sai Agencies Pvt. Ltd., Vs. Chintala Rama Rao and also judgments of the Supreme Court in the case of Ramdev Food Products Pvt. Ltd. Vs. Arvindbhai Rambhai Patel and others and Mohan Pandey and another Vs. Smt. Usha Rani Rajgaria. 9. Before dealing with various submissions made by learned counsel for the parties, it is apposite to note that prior to coming into force of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, most of the societies were registered under the provisions of the Andhra Pradesh Cooperative Societies Act, 1964. Though, initially, entire dairy business was under the control of the Dairy Department of the Government of Andhra Pradesh, but, however, after formation of the A.P. Dairy Development Cooperative Federation Ltd., which is a society registered under the Andhra Pradesh Cooperative Societies Act, 1964, the same was run as an Apex Body to the District-Level societies. The petitioner was a District-Level society and it appears that the entire scheme was under a three-tier structure, i.e. the societies were registered at primary level in the villages, milk unions at district level and Cooperative Societies at State level, which are Apex bodies. From time to time, agreements were entered into by the District-Level societies and they were doing business under the instructions of the Apex Societies, by using the brand name ‘Vijaya’. But, however, in the year 1995, with a view to confer more autonomy on the societies, the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, was brought into force. It is not in dispute that the petitioner society is registered under the said Act. When an attempt was made to cancel its very registration, it had approached this court by W.P.No.23848 of 2004 questioning the jurisdiction of the Registrar in cancelling such registration and the petitioner had succeeded in the said writ petition. Further, in the year 2006, Ordinance No.2 of 2006 was issued, amending Section 4 of the Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995, for exclusion of all Dairy Milk Cooperative Societies from the provisions of the said Act, with a deeming provision to the effect that they are deemed to have been registered under the Andhra Pradesh Cooperative Societies Act, 1964. The said ordinance culminated into Act 20 of 2006, which was also subject matter of challenge before this court in a batch of writ petitions in W.P.Nos.2214 of 2006 and batch, in which petitioner herein is one of the parties. But, however, it is not in dispute that the brand name ‘Vijaya’ and its logo are registered in favour of the respondent Federation. Whether the petitioner society can still claim usage of the said brand, is a matter which requires consideration. While it is the case of the petitioner that brand name ‘Vijaya’ was being used as a permissive user, but, however, it is seriously disputed by the respondents that brand name ‘Vijaya’ and its logo are the exclusive property of the Federation and the District Unions, without entering into Memorandums of Understanding for obtaining consent, cannot use the said brand name. Under the scheme of the Trademarks Act, 1999, there is a specific provision to maintain a suit not inferior to the District Court, having jurisdiction to try the suit, in case of infringement of any trade mark or relating to any right in a registered trade mark. In view of the serious factual disputes with regard to use of registered trade mark, and the fact that the brand name ‘Vijaya’ and its logo are undisputedly registered in the name of the respondent Federation, it is not possible to record any definite finding on the claim of the petitioner for using the said brand name, in this petition filed under Article 226 of the Constitution of India. Further, in view of the availability of alternative remedy of appeal under the very Act and in view of the denial of the claim of the petitioner, for use of the brand name ‘Vijaya’, by the respondent Federation, petitioner cannot seek any declaration from this court for use of the brand name ‘Vijaya’. 10. Though it is the case of the petitioner that it was not signatory to the Minutes dated 26-07-2007, in the absence of any orders consequent to such Minutes, it is not open for the petitioner to question the very validity of the said Minutes. Though it is pleaded that the Chairman who participated in the meeting did not subscribe his signature on such Minutes, and hence the same cannot be said to be binding on the petitioner, it is to be seen that merely because the Minutes are adverse to the interests of the petitioner society, it cannot be said that such Minutes are illegal. But, at the same time, I do find force in the contention of Sri B.V. Subbaiah, learned counsel for the petitioner, that there is illegal interference by the respondents with the business of the petitioner. If the petitioner society is not entitled to use the brand name ‘Vijaya’, for its products and sell the same outside the State, it is open for the respondents to take steps in accordance with the provisions contained in the Trademarks Act, 1999, however, they cannot use the State machinery and seize the vehicles/trucks used for transporting the products manufactured by the petitioner society. Even in the counter affidavit filed by the respondents, it is admitted that when the petitioner society was using the brand name ‘Vijaya’, intervention of the District Collector, Krishna District, was sought and consequent upon the same, vehicles belonging to the petitioner society were seized. Even a copy of the check report filed along with the writ petition indicates that vehicles were seized only consequent to the instructions issued by the District Collector without there being any violation of the provisions of the Motor Vehicles Act and the rules made thereunder. Such course adopted by the respondents is clearly illegal and there is no authority for the respondents to seek intervention of the District Collector for seizing the vehicles in which the products of the petitioner were being transported out of the State. When it is the case of the petitioner society that Minutes were recorded without any authority of law and when it is the claim of the petitioner that since it has become autonomous, it is entitled to use the brand name ‘Vijaya’ for its products, it is open for the respondents to take recourse to civil and criminal proceedings as contemplated under the Trade Marks Act, 1999, or any other applicable law, but using Executive machinery of the State, they cannot interdict the business of the petitioner society. 11. For the foregoing reasons, the writ petition is allowed to the limited extent of declaring that the interference of the business of the petitioner by seizing its trucks/vehicles, used for transportation of products manufactured by it, by the respondents, is illegal and arbitrary. Further, there shall be a direction to the respondents not to interfere and obstruct the vehicles of the petitioner used for transportation of their manufactured products. However, it is made clear that the issue with regard to the claim of the petitioner for using the brand name ‘Vijaya’ is left open and the petitioner is at liberty to seek such declaration before the competent court of law, in terms of the provisions under the Trade Marks Act, 1999. 12. The writ petition is allowed to the extent indicated above. No order as to costs. __________________________ JUSTICE R. SUBHASH REDDY. May 1 , 2008 MRR