2012 (4) TMI 775 - HC - Indian Laws

Court denies stay application, deems rectification invalid without leave, emphasizes need for Court approval.

The Court dismissed the defendant's application for stay of the suit under Section 124 of the Trade Marks Act, 1999, finding it to be an abuse of process ... Stay of suit pending rectification proceedings - prima-facie satisfaction of the court for filing rectification after institution of suit - condition precedent of leave of the court to invoke Section 124 - abuse of process - estoppel by approbation and reprobation / preclusive effect of earlier findings - invocation of Section 124(b) of the Trade Marks Act, 1999Prima-facie satisfaction of the court for filing rectification after institution of suit - invocation of Section 124(b) of the Trade Marks Act, 1999 - Whether the defendant is entitled to a stay of the infringement suit under Section 124(b) of the Trade Marks Act by relying on its rectification proceedings filed after institution of the suit without first obtaining prima-facie satisfaction of this Court. - HELD THAT: - The Court held that where rectification proceedings are not pending at the time a suit is instituted, a party seeking rectification thereafter must obtain the prima-facie satisfaction of the Court about the tenability of the plea of invalidity before invoking the stay machinery under Section 124(b). The Division Bench and the learned Single Judge had already laid down that leave of the Court (prima-facie satisfaction) is a condition precedent to file rectification post-institution of suit and thereby to claim a stay. The plaintiffs could not initiate rectification before the Registrar without demonstrating prima-facie invalidity to the Court, and that inability to file earlier does not permit circumvention of the requirement. Applying these principles to the facts, the Court found that the plaintiffs (and by parity the defendant asserting similar grounds) could not invoke Section 124(b) absent the Court's prima-facie satisfaction, and therefore the present attempt to obtain a stay on the basis of rectification filed after suit was not maintainable. [Paras 11]The defendant cannot claim a stay under Section 124(b) based on rectification filed after institution of the suit without having first obtained the Court's prima-facie satisfaction; such rectification does not automatically attract a stay.Condition precedent of leave of the court to invoke Section 124 - estoppel by approbation and reprobation / preclusive effect of earlier findings - Whether the defendant, having accepted and not challenged earlier findings of the Single Judge and Division Bench that leave of the Court is required, can now seek a contrary position to obtain stay of the suit based on its rectification petition. - HELD THAT: - The Court found that the defendant had accepted the earlier concurrent findings of the Single Judge and Division Bench that leave (prima-facie satisfaction) is required before invoking Section 124, and did not challenge those findings on appeal or by cross-objection. Having accepted those determinations and remained silent for years, the defendant is precluded from taking an inconsistent position now. The doctrine that a party cannot approbate and reprobate, and the principle that earlier judicial conclusions are conclusive at subsequent stages of the same proceedings, were applied to bar the defendant from re agitating the same issue. Allowing the defendant to proceed would amount to re-opening matters already conclusively dealt with and would violate judicial discipline. [Paras 16, 18, 22]The defendant is estopped from taking a contrary position to the earlier findings and cannot seek stay based on rectification; the earlier conclusions bind the defendant.Abuse of process - stay of suit pending rectification proceedings - Whether the present application by the defendant to stay the suit is an abuse of the process of the Court and thus liable to be dismissed. - HELD THAT: - Having accepted prior binding findings and not challenging them, the defendant's renewed attempt to obtain a stay based on substantially the same rectification facts was held to be an abuse of process. Re-opening the question of leave to file rectification would in effect seek to recall or contradict the Division Bench's affirmed view and undermine judicial discipline. The Court concluded that no new events justified re-adjudication; the application was therefore an impermissible re litigation and an abuse of process. [Paras 24, 25]The application is an abuse of process and is dismissed.Final Conclusion: The application for stay under Section 124 of the Trade Marks Act, 1999 is dismissed as not maintainable and an abuse of the process of Court; the defendant is precluded from re agitating the issue after having accepted prior findings that leave (prima-facie satisfaction) is a condition precedent to invoke Section 124. Costs awarded to the plaintiffs. Issues Involved:1. Maintainability of the application for stay of the suit u/s 124 of the Trade Marks Act, 1999.2. Requirement of leave of the Court before filing rectification proceedings.3. Applicability of the principle of constructive res judicata.Summary:1. Maintainability of the Application for Stay of the Suit u/s 124 of the Trade Marks Act, 1999:The defendant sought a stay of the suit u/s 124 of the Trade Marks Act, 1999, arguing that rectification proceedings against the plaintiff's trade mark MERONEM were pending. The plaintiff opposed, stating the application was not maintainable as it violated Section 124 of the Act, was time-barred, and was previously dismissed by the Court. The Court noted that the defendant had filed the rectification in 2005, and the application for stay was not maintainable as it was filed without the Court's leave.2. Requirement of Leave of the Court Before Filing Rectification Proceedings:The Court emphasized that u/s 124(b) CPC, if rectification proceedings are not pending, the party seeking rectification must obtain the Court's prima-facie satisfaction regarding the invalidity of the registration. The Court referenced previous judgments, including Kedar Nath v. Monga Perfumary and Flour Mills and Patel Field Marshal Agencies vs. P.M. Diesels Ltd., to highlight that the leave of the Court is a prerequisite for filing rectification proceedings after the institution of the suit. The Court found that the plaintiffs had not obtained such leave, rendering their rectification application invalid.3. Applicability of the Principle of Constructive Res Judicata:The Court held that the defendant's application was barred by the principle of constructive res judicata, as the issue had already been decided by the learned Single Judge and Division Bench, and the defendant had accepted these findings without challenge. The Court cited Barkat Ali & Another v. Badrinarain and Dwijendra Narain Roy vs. Joges Chandra De to support the principle that a party cannot re-agitate an issue that has been conclusively decided.Conclusion:The Court dismissed the defendant's application for stay of the suit, finding it to be an abuse of the process of law and barred by the principle of constructive res judicata. The application was dismissed with costs of Rs. 5,000. The case was listed before the Joint Registrar on 29.05.2012.