Case: Patel Field Marshal Agencies &amp; Another Vs. P.M. Diesels Ltd. &amp; Others

3. The respondent in Civil Appealof 2001 (P.M. Diesels Ltd.) is the registered owner of three trade marks, the common feature of all of which is the words "Field Marshal". The three registration certificates issued by the Registrar of Trade Marks in favour of the(through its predecessor) is in respect of the mark "Field Marshal" (Registration No. 224879); the second certificate is in respect of trade mark "Field Marshal" in lettering style (Registration No. 252070) and the last certificate is in respect of trade mark "FM Field Marshal" (Registration No.The first registration certificate is dated 16.10.1964 and the second and third registration certificates are dated 4.10.1968.4. It appears that some time in the year 1982 theField Marshal & Anr. applied for registration of the trade mark "Marshal" for their use. Having come to know of the said application and perceiving a similarity between the mark in respect of which registration was sought by the appellants and the mark(s) registered in favour of the respondent, the respondent served a legal Notice dated 23.07.1982 asking the appellants to desist from using the mark in question, i.e., "Marshal".5. In the year 1989, the respondent instituted a suit before the High Court of Delhi (Suit No. 1612 of 1989) for infringement of trade mark, rendition of accounts of profit earned by the appellants from use of the mark "Marshal" and for perpetual injunction to restrain the appellants from using the trading styles "Patel Field Marshal Agencies" and "Patel Field Marshal Industries". An Interlocutory Application for temporary injunction was also filed.6. The defendants in the suit, i.e., the appellants herein, contested the claims of theon the ground of jurisdiction as well as on merits. In the written statement filed, thealso contested the validity of the registration of the respondents trade mark "Field Marshal" and claimed that the same was liable to be rectified in the trade mark register. An issue to the said effect was framed in the suit.7. The Delhi High Court by its Order dated 28.09.1995 dismissed the Interlocutory Application filed by thefor interim injunction on the ground that the High Court did not have jurisdiction, both, pecuniary and territorial, over the subject matter. In appeal, the Division Bench by Order dated 10.03.1998 reversed the decision of the learned single Judge and directed for consideration of the Interlocutory Application for interim injunction on merits. The matter was brought to this Court in Special Leave Petition (C) No.13512 of 1998. During the pendency of the aforesaid S.L.P., in view of the remand order of the Division Bench dated 10.03.1998, a learned single Judge of the High Court granted temporary injunction in favour of theThis was on 07.07.1999. However, by a subsequent Order dated 20.08.2008, the learned single Judge of the High Court held that the court had no jurisdiction and, therefore, ordered for return of the plaint for presentation before the competent court in the State of Gujarat. The said order was challenged by the respondents herein (plaintiffs in the suit) before the Division Bench. The Division Bench by Order dated 24.10.2008 held that in the facts of the case the plaint ought not to have been rejected; however, as the appellant before ithad no objection to carry on the proceedings in the competent court at Rajkot, Gujarat, the plaint was returned to be filed in Rajkot. Thereafter, the case was transferred from the Delhi High Court to the court at Rajkot and the proceedings came to be numbered as Civil Suit No. 1 of 2009 in the file of the learned Additional District Judge, Rajkot.8. While the aforesaid Order of the Division Bench dated 24.10.2008 is the subject matter of challenge in the connected Civil Appeal arising out of S.L.P. (C) No. 1851 of 2009 also filed by the appellant, what is of significance is that when the suit in question was pending adjudication in the High Court of Delhi, the appellants herein initiated parallel proceedings before the High Court of Gujarat (in the year 1997) seeking rectification of the registration of the trade mark(s) granted to the respondent. Specifically, the appellants had filed three rectification applications bearing RA Nos. 1, 2 and 3 of 1997 under Sections 46/56 of the Trade and Merchandise Marks Act, 1958 (hereinafter referred to as the "1958 Act") for removal and cancellation of the three trade marks registered in favour of the petitioner bearing Nos. 224879, 252070 and 252071. The learned single Judge of the High Court of Gujarat dismissed the three applications in question by Order dated 15.04.1998. The said order has been affirmed in appeal by the Division Bench of the Gujarat High Court by its Order dated 25.11.1998. This order has been subjected to challenge in Civil Appealof 2001 presently under consideration.9. While the reasoning of the Division Bench of the High Court in dismissing the applications in question will be noticed in due course, the question calling for an answer by this Court would need a formulation at this stage. An attempt at such formulation is being madea situation where a suit for infringement is pending wherein the issue of validity of the registration of the trade mark in question has been raised either by the plaintiff or the defendant and no issue on the said question of validity has been framed in the suit or if framed has not been pursued by the concerned party in the suit by filing an application to the High Court for rectification under Sections 111 read with Section 107 of the Trade and Merchandise Marks Act, 1958, whether recourse to the remedy of rectification under Sections 46/56 of the 1958 Act would still be available to contest the validity of the registration of the Trade mark.The aforesaid question which arises in the present appeals in the context of the 1958 Act continues to be a live issue in view of the pari materia provisions contained in the Trade Marks Act, 1999, i.e., Sections 47, 57, 124 and 125 of the Trade Marks Act, 1999 (hereinafter referred to as "the 1999 Act").11. The issues arising in Civil Appealand Civil Appeals arising out of S.L.P. (C) No.27309/2012 and S.L.P. (C) No.30121/2012 are same and similar. S.L.P. (C) No.30121/2012, however, has since beenAppeal arising out of S.L.P. (C) No.1851/2009 challenges the order passed by the Delhi High Court on 24.10.2008 by which the plaint was returned to be filed before the competent court at Rajkot, despite the conclusion of the Appellate Bench that the order of the learned Single Judge holding that the Delhi High Court had no jurisdiction and hence the plaint should be returned, is not correct. As the said direction of the Division Bench of the High Court challenged in the appeal was at the instance of the plaintiff (respondent herein), who was the appellant before the High Court, we would understand the stand taken to be a virtual withdrawal of the appeal and an undertaking to comply with the direction of the learned Single Judge to present the plaint before the competent court at Rajkot. In these circumstances, we do not consider it necessary to continue to entertain the challenge made in the appeal arising out of S.L.P. (C) No.1851/2009 so as examine the legality of the correctness of the said order on merits. The person aggrieved before the High Court i.e. the respondent herein chose to comply with the order of the leaned Single Judge. The appellant herein was not aggrieved by the order of the learned Single Judge. The aforesaid proceeding i.e. arising out of S.L.P. (C) No.1851/2009, in the circumstances set out above, is accordingly closed. Two appeals, therefore, survive for consideration i.e. Civil Appealand Civil Appeal arising out of S.L.P. (C) No.27309/2012.

Reasoning:
The question does not seem to have received/engaged the attention of this Court at any earlier point of time and therefore will have to be answered by us.Rather, from the resume of the provisions of the 1958 Act made above it becomes clear that all questions with regard to the validity of a Trade Mark is required to be decided by the Registrar or the High Court under the 1958 Act or by the Registrar or the IPAB under the 1999 Act and not by the Civil Court. The Civil Court, infact, is not empowered by the Act to decide the said question. Furthermore, the Act mandates that the decisions rendered by the prescribed statutory authority [Registrar/High Court (now IPAB)] will bind the Civil Court. At the same time, the Act (both old and new) goes on to provide a different procedure to govern the exercise of the same jurisdiction in two different situations. In a case where the issue of invalidity is raised or arises independent of a suit, the prescribed statutory authority will be the sole authority to deal with the matter. However, in a situation where a suit is pending (whether instituted before or after the filing of a rectification application) the exercise of jurisdiction by the prescribed statutory authority is contingent on a finding of the Civil Court as regards the prima facie tenability of the plea of invalidity.The 1958 Act clearly visualizes that though in both situations i.e. where no suit for infringement is pending at the time of filing of the application for rectification or such a suit has came to be instituted subsequent to the application for rectification, it is the Registrar or the High Court which constitutes the Tribunal to determine the question of invalidity, the procedure contemplated by the Statute to govern the exercise of jurisdiction to rectify is, however, different in the two situations enumerated. Such difference has already been noted.30. The intention of the legislature is clear. All issues relating to and connected with the validity of registration has to be dealt with by the Tribunal and not by the civil court. In cases where the parties have not approached the civil court, Sections 46 and 56 provide an independent statutory right to an aggrieved party to seek rectification of a trade mark. However, in the event the Civil Court is approached, inter alia, raising the issue of invalidity of the trade mark such plea will be decided not by the civil court but by the Tribunal under the 1958 Act. The Tribunal will however come into seisin of the matter only if the Civil Court is satisfied that an issue with regard to invalidity ought to be framed in the suit. Once an issue to the said effect is framed, the matter will have to go to the Tribunal and the decision of the Tribunal will thereafter bind the Civil Court. If despite the order of the civil court the parties do not approach the Tribunal for rectification, the plea with regard to rectification will no longer survive.31. The legislature while providing consequences forwith timelines for doing of any act must be understood to have intended such consequences to be mandatory in nature, thereby, also affecting the substantive rights of the parties. This is how Section 111(3) of the 1958 Act has to be understood. That apart, it is very much within the legislative domain to create legal fictions by incorporating a deeming clause and the court will have to understand such statutory fictions as bringing about a real state of affairs between the parties and ushering in legal consequences affecting the parties unless, of course, there is any other contrary provision in the statue. None exists in the 1958 Act to understand the provisions of Section 111(3) in any other manner except that the right to raise the issue of invalidity is lost forever if the requisite action to move the High Court/IPAB (now) is not initiated within the statutorily prescribed time frame.32. Thus, by virtue of the operation of the 1958 Act, the plea of rectification, upon abandonment, must be understood to have ceased to exist or survive between the parties inter se. Any other view would be to permit a party to collaterally raise the issue of rectification at any stage notwithstanding that a final decree may have been passed by the civil court in the meantime. True, the decree of the Civil Court will be on the basis of the conclusions on the other issues in the suit. But to permit the issue of rectification, once abandoned, to be resurrected at the option of the party who had chosen not to pursue the same at an earlier point of time would be to open the doors to reopening of decrees/orders that have attained finality in law. This will bring in uncertainty if not chaos in the judicial determinations between the parties that stand concluded. Besides, such an interpretation would permit an aggrieved party to get over the operation of a statute providing for deemed abandonment of the right to raise an issue relevant; in fact, fundamental to the lis. The position may be highlighted by reference to a suit for infringement where the defendant raises the plea of invalidity of the plaintiffs trade mark and also in the alternative takes up any of the defenses available in law. The defendant by operation of Section 111(3) of the 1958 Act is deemed to have abandoned the plea of invalidity. In the trial it is found that the defendant is guilty of infringement and is appropriately restrained by a decree of the Civil Court. If the right under Section 46/56 of the 1958 Act is to subsist even in such a situation, the possible uncertainty and possible anarchy may well be visualized. This is why the legislature by enacting Section 111 of the 1958 Act has mandated that the issue of invalidity which would go to the root of the matter should be decided in the first instance and a decision on the same would bind the parties before the civil court. Only if the same is abandoned or decided against the party raising it that the suit will proceed in respect of the other issues, if any. If the above is the legislative intent, which seems to be clear, we do not see how the same can be overcome by reading the rights under Sections 46 and 56 of the 1958 Act to exist even in a situation where the abandonment of the same right under Section 111(3) has taken effect in law. The mandate of the 1958 Act, particularly, Section 111 thereof, appears to be that if an aggrieved party does not approach the Tribunal for a decision on the issue of invalidity of registration as provided for under Section 111(2) and (3), the right to raise the issue (of invalidity) would no longer survive between the parties to enable the concerned party to seek enforcement of the same by recourse to or by a separate action under the provisions of Section 46/56 of the 1958 Act.33. Having dealt with the matter in the above manner, certain subsidiary and incidental questions, urged and argued by the parties, would also need an answer.Section 111 of the 1958 Act and the corresponding Section 124 of the 1999 Act nowhere contemplates grant of permission by the civil court to move the High Court or the IPAB, as may be, for rectification. The true purport and effect of Sections 111/124 (of the old and new Act) has been dealt within detail and would not require any further discussion or enumeration. The requirement of satisfaction of the civil Court regarding the existence of a prima facie case of invalidity and the framing of an issue to that effect before the law operates to vest jurisdiction in the statutory authority to deal with the issue of invalidity by no means, tantamount to permission or leave of the civil court, as has been contended. It is a basic requirement to further the cause of justice by elimination of false, frivolous and untenable claims of invalidity that may be raised in the suit.36. While Section 32 of the 1958 Act, undoubtedly, provides a defence with regard to the finality of a registration by efflux of time, we do not see how the provisions of aforesaid section can be construed to understand that the proceedings under Sections 46 and 56 on the one hand and those under Sections 107 and 111 on the other of the 1958 Act and the pari materia provisions of the 1999 Act would run parallelly. As already held by us, the jurisdiction of rectification conferred by Sections 46 and 56 of the 1958 Act is the very same jurisdiction that is to be exercised under Sections 107 and 111 of the 1958 Act when the issue of invalidity is raised in the suit but by observance of two different procedural regimes.