PATEL FIELD MARSHAL AGENCIES AND ANR.AND ANR. Vs P.M. DIESELS LTD. AND ORS AIR 2017 Supreme Court

Section 111 of the Trademarks Act, 1958 (pari matria to Section 124 of the new 1999 Act ) provides for the possibility of stay of a trademark infringement suit in case there is a challenge to the registered trademark which is the subject matter of the suit. The seemingly simple provision had led to conflicting views until the law was finally settled by the Supreme Court in the landmark ruling of ‘Patel Field Marshal’ case

This Article shall discuss in brief the facts and issues that both the parties raised before the Honorable Court and the judgement given by Bench Ranjan Gogoi Justice,Navin Sinha Justice

Facts :

1. The respondent was the registered owner of three trademarks, the common feature of all of these trademarks are the words “Field Marshal”
2. In the year 1989, the respondent instituted a suit before the High Court of Delhi for infringement of trademark and rendition of accounts of profit for the use of the mark “Marshal” by the appellant and for perpetual injunction to restrain the appellants from using the trading styles “Patel Field Marshal Agencies” and “Patel Field Marshal Industries”
3. An Interlocutory Application for a temporary injunction was also filed. The defendants in the suit, i.e., the appellants herein, contested the validity of the registration of the respondent’s trademark “Field Marshal” and claimed that the same was liable to be rectified in the trademark register.
4. 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 trademark(s) granted to the respondent
5. Specifically, the appellants had filed three rectification applications under Sections 46/56 of the Trade and Merchandise Marks Act, 1958 for removal and cancellation of the three trademarks registered in favour of the petitioner.
6. 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 Appeal of 2001 presently under consideration.

Issues Raised : Whether in an infringement suit, wherein the question of validity of registration of the trademark in question has not been raised/pursued, will the concerned party will have remedy under Sections 111 read with Section 107 or will the party still have recourse to the emedy under Sections 45/56 of the Trade and Merchandise Marks Act, 1958?

Arguments on behalf of Appellant

 It was stated that under the act there are two types of rights which are granted. One is granted to the owner of a registered trademark(Sections 28 and 29) and the other is granted to a person who is aggrieved by such a registration(Sections 46 and 56).. Both are independent and parallel of each other.

 The appellants argued that sec 107 and sec 111 contemplate granting of permission by the trial court for filing of an application for rectification and the same does not follow from a bare reading of the two provisions.

 The only condition necessary to prefer an application under sec 107 read with sec 111 would be that a person should be an aggrieved person.

 There exists a higher provision under Section 41(b) of the Specific Relief Act, 1963 which restrains a subordinate court from preventing a person from instituting proceedings.

Arguments on behalf of Respondant

 The defendants contended that sec 111 (3) and sec 111(4) make it clear that once the court is satisfied that a question regarding the validity of a registration of trademark has arisen then the same has to be decided in a rectification proceeding.

 It was argued that sec 46 and sec 56 relate to a situation where no suit is pending adjudication for infringement. These sections are independent of sec 107 and sec 111.

 It was argued that when a suit for infringement has been filed and questions of the trademark’s validity have arisen and the court is satisfied about the issue then the provisions of sec 111 will be applicable. If a party abandons the plea of invalidity then it would mean that the same is relinquished and recourse to sec 45 and 56 would close.

Judgment :

The Supreme Court settled the issue by holding that:

 The questions of validity of registration are to be decided by the tribunal and not the civil court. In situations where the party has not moved the civil court, sec 46 and sec 56 provide a party the statutory right to seek rectification.

 If a party has moved the civil court and the issue of validity of a trademark has been raised then such a plea will be decided by the tribunal and not the civil court. This will happen only if the civil court is satisfied and it has framed an issue to that effect. The decision of the tribunal will be binding on the civil court.

 If the parties do not approach the tribunal for rectification after the order of the civil court then the parties relinquish the plea to rectification.

 It was held that the plea of rectification would cease if the same is abandoned and the recourse under sec 46 and sec 56 would not be available to the parties. If the same is allowed to subsist then the same would lead to anarchy.

 It was observed that the intent of the legislature by enacting sec 111 is to address the question of invalidity needs to be decided in the first instance. Once the plea of rectification has been raised and settled will the suit proceed with regard to the other issues.

-Kriti Sakuja