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2022 Supreme(SC) 223

SUPREME COURT OF INDIA
(From the High Court of Calcutta)
L. Nageswara Rao, B.R. Gavai, JJ.
SHYAM SEL AND POWER LIMITED AND ANOTHER – APPELLANT(S)
VERSUS
SHYAM STEEL INDUSTRIES LIMITED – RESPONDENT(S)
Civil Appeal No. 1984 of 2022 [Arising out of SLP(C) No. 4080 of 2022]
Decided On : 14-03-2022

Important Points

IMPORTANT POINTS
(1) Letters Patent Appeal – Word ‘judgment’ has a concept of finality in a broader and not in a narrower sense--Where an order vitally affects a valuable right of defendants, it will be treated as a ‘judgment’ within meaning of Letters Patent so as to be appealable to a larger Bench.
(2) Injunction – Unwarranted proceedings at behest of parties who can afford to bear expenses of such litigations, must be discouraged.

Subject

Appeal - JUDGMENT

Act Referred

Headnote

(A) Civil Procedure Code, 1908 – Order XXXIX Rules 1 and 2 – Injunction – Infringement of trade mark and passing off – In order passed by Single Judge, there was no adjudication with regard to rights of respondent-plaintiff to get an ad-interim injunction during pendency of suit – Though by postponement of issue with regard to grant of ad-interim injunction, order might have caused some inconvenience and may be, to some extent, prejudice to respondent-plaintiff; same could not be treated as a ‘judgment’ inasmuch as there was no conclusive finding as to whether respondent-plaintiff was entitled for grant of ad-interim injunction or not – As such, order passed by Single Judge did not contain traits and trappings of finality – Order cannot be construed to be a ‘judgment’ within meaning of Clause 15 of Letters Patent and as such, appeal to Division Bench of High Court was not tenable – An appellate court, after findings of trial court are recorded, has an advantage of appreciating view taken by trial judge and examining correctness or otherwise thereof within limited area available – If appellate court itself decides matters required to be decided by trial court, there would be no necessity to have hierarchy of courts – Insofar as tests of balance of convenience and irreparable injury are concerned, there is not even a mention with regard to these in impugned judgment and order of Division Bench of High Court – Approach of Division Bench of High Court was totally unwarranted and uncalled for – Courts in India are already overburdened with huge pendency – Such unwarranted proceedings at behest of parties who can afford to bear expenses of such litigations, must be discouraged – Present appeal deserves to be allowed with token costs – Respondent-plaintiff shall pay a token cost of Rs.5 lakhs to Supreme Court Middle Income Group Legal Aid Society (MIG). (Paras 25, 29, 36 and 37)

(B) Letters Patent Appeal – Maintainability – Term ‘judgment’ used in Letters Patent could not be given a narrower meaning as is given to term ‘judgment’ used in CPC and it should receive a much wider and more liberal interpretation, however, at the same time, each and every order passed by trial judge could not be construed to be a ‘judgment’ inasmuch as there will be no end to number of orders which would be appealable under Letters Patent – Word ‘judgment’ has a concept of finality in a broader and not in a narrower sense – Where an order vitally affects a valuable right of defendants, it will be treated as a ‘judgment’ within meaning of Letters Patent so as to be appealable to a larger Bench – Most of interlocutory orders which contain quality of finality, would be ‘judgments’ within meaning of letters patent and, therefore, appealable – However, there may be interlocutory orders which are not covered by Order XLIII Rule 1 CPC but which also possess characteristics and trappings of finality inasmuch as such orders may adversely affect a valuable right of party or decide an important aspect of trial in an ancillary proceeding – However, for such an order to be a ‘judgment’, an adverse effect on party concerned must be direct and immediate rather than indirect or remote – Though any discretion exercised or routine orders passed by trial Judge in course of suit may cause some inconvenience or, to some extent, prejudice to one party or other, they cannot be treated as a ‘judgment’ unless they contain traits and trappings of finality – Each and every order passed by Court during the course of trial, though may cause some inconvenience to one of parties or, to some extent, some prejudice to one of parties, cannot be treated as a ‘judgment’ – If such is permitted, floodgate of appeals would be open against order of Single Judge. (Paras 17, 18 and 21)

Facts of the case:

Present appeal challenges the judgment and order passed by Division Bench of the High Court of Calcutta dated 24th December 2019, arising out of the order passed by Single Judge of the High Court dated 2nd April 2019, by which Single Judge had granted time to the appellants-defendants to file affidavit-in-opposition and directed to post the matter after three weeks. By the said order, Single Judge also directed the appellants-defendants to maintain weekly accounts of sale of the products covered by Class 6, which are sold under the mark ‘SHYAM’.

Findings of Court:

Single Judge is requested to decide application filed by the respondent-plaintiff under Order XXXIX Rules 1 and 2 CPC as expeditiously as possible and in any case, within a period of six weeks from the date of this judgment. Till further orders are passed by Single Judge, order passed by Single Judge dated 2nd April 2019 would continue to operate.

Result : Appeal allowed.

Legal Category Hierarchy

  • intellectual property law
    • trademarks
      • infringement and passing off (Para 3, 4, 5, 6)
  • practice and procedure
    • civil procedure
      • temporary injunctions (Para 6, 7, 29, 34, 36)
      • intra-court appeals (Para 10, 15, 16, 17, 18, 21, 25)
      • appellate jurisdiction (Para 29, 31, 34)

Advocates appeared:
For the Petitioner(s): Mr. Mukul Rohatgi, Sr. Adv. Mr. Shyam Divan, Sr. Adv Ms. Aparajita Singh, Sr. Adv. Mr. Mahesh Agarwal, Adv. Mr. Gaurav Mukerjee, Adv. Ms. Parul Shukla, Adv. Mr. Amol Dixit, Adv. Mr. Rudraman Bhattacharya, Adv. Mr. Sidharta Das, Adv. Mr. Sanjay Ginodia, Adv. Mr. Manoj Tiwari, Adv. Mr. Shuvashish Sengupta, Adv. Mr. Rishabh Parikh, Adv. Mr. Anirudh Bhatia, Adv. Ms. Ayushi Amod, Adv. Mr. E. C. Agrawala, AOR
For the Respondent(s): Mr Ranjit Kumar, Sr Adv Mr Neeraj Kishan Kaul, Sr Adv Mr N G Khaitan, Adv Mr Debanath Ghosh, Adv Mr Ajay Bhargava, Adv Ms Vanita Bhargava, Adv Mr Sayan Roychowdhary, Adv Mr Ayush Agarwal, Adv Ms Trishala Trivedi, Adv Ms Vaibhavi Pandey, Adv M/s. Khaitan & Co., AOR

Table of Contents

1. Trademark infringement and passing off suit — Application for temporary injunction — Single Judge's order granting time to file affidavit-in-opposition and postponing hearing. (Para 3 , 4 , 5 , 6 , 7 )

2. Maintainability of intra-court appeal against procedural orders — Whether the order constitutes a judgment under Letters Patent — Scope of appellate interference in discretionary orders. (Para 10 , 11 , 12 , 13 )

3. Analysis of judgment under Letters Patent — Distinction between routine procedural orders and those affecting vital rights — Critique of appellate usurpation of trial court jurisdiction. (Para 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 23 , 24 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 )

4. An order postponing a hearing to allow filing of affidavits is a routine procedural order lacking traits of finality and is not a judgment under Letters Patent. (Para 21 , 25 )

5. Appeal allowed — Division Bench order set aside — Single Judge directed to decide the injunction application expeditiously. (Para 37 , 38 )

6. What constitutes a judgment under Clause 15 of the Letters Patent for the purpose of an intra-court appeal?

A judgment must possess the traits and trappings of finality, deciding matters of moment or affecting vital and valuable rights of the parties, which would work serious injustice if not appealable. Routine procedural orders that cause mere inconvenience do not qualify. (Para 17 , 18 , 21 )

7. Does an order granting time to file a reply and postponing an injunction hearing constitute a judgment?

No. Such an order is a postponement of the issue and a routine procedural step to afford the opposite party an opportunity to file a reply. It does not contain a conclusive finding on rights and lacks the traits of finality. (Para 23 , 24 , 25 )

8. To what extent can an appellate court interfere with a trial court's exercise of discretion regarding interlocutory injunctions?

An appellate court should not substitute its own discretion for that of the trial court unless the discretion was exercised arbitrarily, capriciously, perversely, or the court ignored settled principles of law regulating the grant or refusal of injunctions. (Para 31 , 34 )

9. Can an appellate court decide an interlocutory application instead of relegating it to the trial court?

No. An appellate court cannot usurp the jurisdiction of the Single Judge to decide whether the tests of prima facie case, balance of convenience, and irreparable injury are met, as this would undermine the hierarchy of courts. (Para 29 , 33 )

JUDGMENT

B.R. Gavai, J.

1. Leave granted.

2. This appeal challenges the judgment and order passed by the Division Bench of the High Court of Calcutta dated 24th December 2019, arising out of the order passed by the learned Single Judge of the High Court dated 2nd April 2019, by which the learned Single Judge had granted time to the appellants-defendants to file affidavit-in-opposition and directed to post the matter after three weeks. By the said order, the learned Single Judge also directed the appellants-defendants to maintain weekly accounts of sale of the products covered by Class 6, which are sold under the mark ‘SHYAM’.

3. The facts in the present case are not much in dispute. The respondent-plaintiff had filed a suit against the appellants-defendants for infringement of trade mark and passing off. It is the case of the respondent-plaintiff that it has trade mark registration in respect of the word ‘SHYAM’ and diverse label marks wherein the word ‘SHYAM’ features prominently. Both the respondent-plaintiff and the appellants-defendants manufacture and sell, inter alia, Thermo-Mechanically treated bars (hereinafter referred to as “TMT bars”). It is the case of the respondent-plaintiff that in the year 2015, it came to know that the appellants-defendants were using the mark ‘SHYAM’ in their products. The respondent-plaintiff therefore, through its advocate, objected to such use. It is the case of the respondent-plaintiff that the appellants-defendants agreed to phase out the products that they had manufactured with the mark ‘SHYAM’ and not to use the said mark ‘SHYAM’ on their products in future.

4. It is further the case of the respondent-plaintiff that the appellants-defendants had applied for registration of the mark ‘SHYAM INFRA’. The respondent-plaintiff had filed its objection to it. It is further its case that since the appellants-defendants did not file their counter-statement, the application lapsed and was treated as abandoned.

5. It is further the case of the respondent-plaintiff that towards the end of 2018, the appellants-defendants started to use the word ‘SHYAM METALICS’ on the packaging of their TMT bars. According to respondent-plaintiff, though the appellants-defendants had used the word ‘SHYAM’ on their invoices and stationeries, they had not used the said word ‘SHYAM’ on their wrappers in which their TMT bars were packed. According to the respondent-plaintiff, this was done by the appellants-defendants only to take advantage of the growing and expanding business of the respondent-plaintiff and with an intention that the products manufactured and sold by the appellants-defendants could be passed off as those of the respondent-plaintiff. In this background, the respondent-plaintiff filed a civil suit being CS No. 63 of 2019 before the learned Single Judge of the High Court of Calcutta, claiming infringement of their registered trade mark ‘SHYAM’ and its variants and also for passing off by the appellants-defendants.

6. Along with the suit, an application being GA No.857 of 2019 in CS No. 63 of 2019 for temporary injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC”) came to be filed. The said application basically claimed an order of injunction restraining the appellants-defendants from infringing the respondent-plaintiff’s trade mark ‘SHYAM’ and its variants and in particular, trade mark registration No. 987596. The said application sought an injunction restraining the appellants-defendants from, in any manner, passing off and enabling others to pass off the respondent-plaintiff’s products by use of trade marks comprising the word ‘SHYAM’ or any other trade mark similar thereto.

7. The said suit and the application for temporary injunction came to be filed in the month of March, 2019. The application came up for consideration for grant of ad-interim injunction before the learned Single Judge on 2nd April 2019. The learned Single Judge made a prima facie

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