Interpreting the Design Act

The cases dealing in the field of design law are few. In the recent case of SD Container vs. Mold Tek Packaging, the Supreme delves into some of the important provisions of the Design Act and interpreting some of the aspects that are raised in the infringement proceedings such as design cancellation action and cause of action. The Supreme Court also observes the extent of the term ‘High Court’ under the Design Act.

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Facts

The Plaintiff/Respondent had initially filed a suit for declaration, and to obtain a permanent injunction to restrain the Defendants/Appellants, represented by Abhijeet Dekhmukh and Meenakshi Ogra, Advocates at Khurana and Khurana,  from using the design of their containers and lids, which had been duly registered under the Design Act. However, on the other hand, the Defendants/Appellants, contended that the said registered designs could not have been registered ab initio under section 4(2) of the Design Act, as they were not novel or original, and therefore, should be canceled in accordance to the provisions of section 19 of the Design Act. Further, the appellants also filed an application under section 22(4) read with section 19(2) of the Design Act to transfer these proceedings to the MP High Court, Indore Bench. However, the Ld. District Judge transferred this dispute to the Calcutta High Court, and aggrieved by this decision, the Plaintiffs/Respondents appealed to the MP High Court, whereby, the MP High Court set aside the order dated 23.03.2020, to transfer the suit under section 22(4) of the Design Act, 2000 to the Calcutta High Court, and declared that the commercial court at Indore had the jurisdiction to hear this dispute. Thereafter, the Defendants/Appellants filed the present appeal against the order passed by the MP High Court. (Excerpts from- https://www.khuranaandkhurana.com/2020/12/10/s-d-containers-indore-v-m-s-mold-tek-packaging-supreme-court-hears-transfer-case/)

Observation

Section 22(4) of the Design Act states that “Notwithstanding anything contained in the second proviso to sub-section (2), where any ground or which the registration of a design may be canceled under Section 19 has been availed of as a ground of defense under sub-section (3) in any suit or other proceeding for relief under sub-section (2), the suit or such other proceedings shall be transferred by the Court, in which the suit or such other proceeding is pending, to the High Court for decision.”

Section 22(4) provides two observations. Firstly, if the ground of cancellation of the design proceedings is taken as the ground of defense, then there should be the compulsory transfer of the proceeding to the high court. Secondly, the mention of section 19 which substantiates section 22(4), permitting, upon application to the Controller of Designs, design registrations to be canceled for substantive grounds including prior registration or publication, lack of novelty or originality, and failure to meet the requirement for registration, among others.

The District Court of Indore, where the case was received first, is a designated Commercial Court within the meaning of the Commercial Court Act. Meaning thereby, as soon as the case was made and the defense was set under Section 19, Section 22(4) becomes functional. The challenge is with the designation of the court under the Commercial Court Act where its Section 7(2) speaks that all suits and applications transferred to the High Court under sub-section (4) of section 22 of the Designs Act, 2000 (16 of 2000) or section 104 of the Patents Act, 1970 (39 of 1970), shall be heard and disposed of by the Commercial Division of the High Court in all the areas over which the High Court exercises ordinary original civil jurisdiction. The Commercial Division of the High Court over which the HC exercises ordinary original civil jurisdiction remains under ambiguity. Designating the District Court, can it be said that the HC has chosen the District Court as a close approximation of the Commercial Division of High Court?

The Supreme Court while interpreting the High Court as per the Design Act reiterated the natural meaning of the same. The transfer to the high court must be done as soon as the ground of defense has been invoked. There cannot be any inconsistency of the Commercial Court Act with the provision of the Design Act. Concerning design cancellation action raised before the Controller of Design, any appeal from the Controller will lie to the High Court. For any such infringement action before a Civil Court, the transfer can be made as per Section 22(4). Through this, the Court inferred that both cancellation and infringement action of design are independent provisions and give rise to a different and distinct cause of action.

Author: Saransh Chaturvedi (an advocate) currently pursuing LLM from Rajiv Gandhi School of Intellectual Property Law (IIT Kharagpur).  In case of any queries please contact/write back to us at support@ipandlegalfilings.com.