AI Drafter 
TaxTMI 
TaxTMI 
2025 (4) TMI 877
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....ing an alleged copyright infringement, whereby the 4th Additional District Judge at Vadodara's (Commercial Court) order dated 03.05.2024 allowing an application under Order VII Rule 11 of the Code of Civil Procedure, 1908 (CPC) was set aside, and the Suit filed by Respondent No. 2 was restored to its original number (Impugned Judgement). 3. The parties to the appeal are, inter alia embroiled in a dispute concerning the purported infringement of intellectual property (IP) rights in relation to the designing and manufacturing of the internal parts of Cryogenic Storage Tanks and Distribution Systems which are mounted on Trailers and Semi-Trailers, to effectively transport industrial gases, liquified natural gas (LNG) and such like substances. A. FACTS 4. That being so, given the shared sequence of events underlying these two appeals, this presents an appropriate juncture for a detailed examination of the factual matrix. 4.1. The dispute between the parties arose when Respondent No. 1 in these appeals, Inox India Limited (Inox), filed Trademark Suit No. 3/2019 (Suit) before the Commercial Court against the Appellants, i.e. Cryogas Equipment Private Limited (Cryogas) and LNG....
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....more than fifty times by an industrial process, either by the copyright owner or any authorised licensee. Specifically, it contested Inox's claim of generating revenue amounting to Rupees 122 crores, arguing that such proceeds could only have been realised through the sale of Cryogenic Semi-trailers manufactured by an industrial process and using the Proprietary Engineering Drawings in excess of the stipulated threshold of fifty reproductions. In this context, LNG Express assailed that protection could not be sought under the Copyright Act by virtue of Section 15(2), and the Suit thus falls at the threshold. 4.5. The Commercial Court, on 01.04.2022, allowed the application filed by LNG Express under Order VII Rule 11 of the CPC, consequently rejecting Inox's plaint and its application for interim injunction. Inox filed two appeals before the High Court challenging the orders of the Commercial Court. On 13.03.2024, the High Court, through a common order set aside the Commercial Court's order, holding that it erred in allowing the application under Order VII Rule 11 of the CPC, which had led to the rejection of both the plaint and the prayer for interim injunction. The High Court ....
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....g protection of the Proprietary Engineering Drawings under the Copyright Act, alleging that Cryogas and LNG Express had infringed its IP rights in both the artistic elements of the drawings and the literary components detailing the processes and descriptions therein. Inox further sought to restrain Cryogas and LNG Express from converting the two-dimensional industrial drawings of cryogenic Semi-trailers into three-dimensional representations. However, these pleas ought to be outrightly rejected as they have been raised as an afterthought to circumvent the applicability of Section 15(2) of the Copyright Act. Admittedly, Semi-trailers can only be manufactured through an industrial and mechanical process. (b) LNG and Cryogenic Semi-trailers worldwide are designed in accordance with international standard-setting bodies such as the American Society of Mechanical Engineers (ASME) and the Pressure Equipment Directive (PED). Given that these trailers are used for transporting cryogenic liquids, their design must comply with country-specific regulations, while international standards prescribe detailed guidelines on design parameters, material selection, and internal components. A....
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....ions such as Shri Mukund Bhavan Trust and others v. Shrimant Chhatrapati Udayan Raje Pratapsinh Bhonsle. (2024) SCC OnLine SC 3844 (g) Inox has erroneously asserted that the Proprietary Engineering Drawings are not capable of registration as 'designs' under Section 2(d) of the Designs Act on the ground that the products manufactured using these drawings lack visual appeal, as they pertain to the inner vessel of the Semi-trailer, which remains concealed. This claim ought to be rejected, as the drawings fall within the category of designs capable of registration under the Designs Act but have not been registered. Moreover, it is incorrect to suggest that the Semi-trailers lack visual appeal, given that the drawings also encompass the external shape and components of a Semi-trailer. In any case, the question of visual appeal is inherently subjective and cannot be a determinative factor for considering an application under Order VII Rule 11 of the CPC. (h) The scope of inquiry before the Commercial Court in the Suit is limited to determining whether the Proprietary Engineering Drawings are capable of registration under the Designs Act and, if they have not been so reg....
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....peal, a necessary criterion for a 'design' under the Designs Act. Accordingly, Section 15(2) of the Copyright Act is inapplicable, and the Proprietary Engineering Drawings cannot be deemed capable of registration under the Designs Act. (c) The Literary Work in question is not subject to the bar under Section 15(2) of the Copyright Act. The Commercial Court erred in concluding that the Literary Work, including details, processes, and descriptions, is merely a reference to the Proprietary Engineering Drawings and the information contained therein. Such an interpretation incorrectly assumes that all the rights asserted in the plaint are intrinsically linked to the Proprietary Engineering Drawings. This approach is inconsistent with fundamental principles of copyright law, which recognise that each category of copyright protection is distinct and must be assessed independently. (d) The infringement arising from the theft of confidential information constitutes a distinct legal issue and is not subject to the limitations imposed by Section 15(2) of the Copyright Act. Courts have consistently recognised that confidential information is a separate legal concept possessin....
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....es around the maintainability of the application under Order VII Rule 11 of the CPC. However, given the abstruse nature of the underlying dispute, stemming from a fundamental dissonance in the parties' interpretations of the applicability of the Designs Act, we deem it appropriate to adjudicate and analyse the following issues: i. What are the parameters for determining whether a work or an article falls within the limitation set out in Section 15(2) of the Copyright Act, thereby classifying it as a 'design' under Section 2(d) of the Designs Act? ii. Whether the High Court erred in setting aside the order of the Commercial Court and thus rejecting the application under Order VII Rule 11 of the CPC? E. ANALYSIS E.1 Issue No. 1: The parameters for determining whether a work or an article falls within the limitation set out in Section 15(2) of the Copyright Act 8. We may clarify at the very outset that the discussion herein would be limited to determining the distinction between a 'design' under the Designs Act and an 'artistic work' that might warrant copyright protection. To be precise, we are not, either expressly or implicitly, addressing the merits of t....
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....ubstantial part thereof, namely..." It espouses the protection of works in terms of: (i) literary, dramatic or musical work, not being a computer programme; (ii) a computer programme; (iii) an artistic work; (iv) a cinematograph film; and (v) a sound recording. To put it in more clear terms, the language employed in the provision reads as follows: "14. Meaning of Copyright-For the purposes of this Act, "copyright" means the exclusive right subject to the provisions of this Act, to do or authorise the doing of any of the following acts in respect of a work or any substantial part thereof, namely:- (a) in the case of a literary, dramatic or musical work, not being a computer programme,- (i) to reproduce the work in any material form including the storing of it in any medium by electronic means; (ii) to issue copies of the work to the public not being copies already in circulation; (iii) to perform the work in public, or communicate it to the public; (iv) to make any cinematograph film or sound recording in respect of the work; (v) to make any translation of the work; (vi) to make any adaptation of the work; ....
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....rticle whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye but does not include any mode or principle of construction or anything which is in substance a mere mechanical device, and does not include any trade mark as defined in clause (v) of sub-section (1) of section 2 of the Trade and Merchandise Marks Act, 1958 (43 of 1958) or property mark as defined in section 479 of the Indian Penal Code (45 of 1860) or any artistic work as defined in clause (c) of section 2 of the Copyright Act, 1957 (14 of 1957)." This aspect of IP thus focuses on the utility of work, as well as its visual appeal and aesthetic, making it an important factor in determining consumer preference or commercial viability. 13. It must be borne in mind that Section 2(d) of the Design Act, reproduced above, expressly bars the inclusion of 'artistic works' encapsulated under Section 2(c) of the Copyright Act. To further illuminate, the expression 'artistic work' has been defined in the Copyright Act which reads as follows: ....
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....being an express interdiction on designs from seeking any longterm copyright protection. E.1.2. Parameters adopted across various jurisdictions 18. To resolve this legal conundrum, it is essential to establish clear parameters distinguishing works eligible for protection under the Designs Act versus the Copyright Act. In this vein, we turn to established jurisprudence and comparative legal frameworks, and have thus examined: (i) the approach adopted by Courts in India; (ii) the factors employed by courts in the United States of America (US); and (iii) broader international principles that provide guidance on the interplay between copyright and design protection. 19. By synthesising these perspectives, we aim to formulate a definitive test that will provide clarity on the scope of protection afforded under the respective Statutes. E.1.2.1 Approach adopted by Courts in India 20. The test applied by various High Courts in India to resolve the intersection between the Copyright Act and the Designs Act can be categorised into two distinct approaches: i. Interpretation of Section 15(2) of the Copyright Act: This involves pulling back the curtains on the overlaps o....
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.... designs on textile goods have been classified as proper subject matter of design protection by inclusion under Class 5 of the Design Rules, 2001; (iv) Legislative intent is also to be kept in mind, which is to protect the creator of the work for a certain period for commercial exploitation. Protection under the Copyright Act is for the lifetime of the author and an additional period of sixty years, which is not so in the case of the Designs Act, where the period is much lesser; (v) 'Artistic work' defined under Section 2(c) of the Copyright Act has been excluded from the definition of 'design' under Section 2(d) of the Designs Act to exclude for instance, works such as the painting of M.F. Hussain; (vi) It is apparent that it is the Designs Act which would give protection to the plaintiff in this case and not the Copyright Act, as the work in question cannot be labelled as an 'artistic work'. 24. The Delhi High Court followed and affirmed the ratio in Microfibres I (supra) in subsequent judgements, such as in Dart Industries Inc and another v. Techno Plast and others, 2007 SCC OnLine Del 892 where the controversy concerned the plaintiffs, who were manufactures of 'Tupperware....
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....rial process. There, if the drawings became capable of registration as a design it would not result in copyright being fortified [See Warner Brothers v. Roadrunner, 1988 FSR 292]. However, if the intended industrial use of the work was contemporaneous with its coming into existence, Section 15 of the Copyright Act would apply. I may hasten to clarify that it is not suggested that if any design is registered, copyright under no circumstance exist in the drawings. Section 15 lays down that on registration of a design under the Designs Act, the copyright shall not subsist in that design and not in the drawings. Therefore, it is possible that when the moulded plastic article of novel shape is made from a working drawing, as in the instant case, the drawing may qualify as an original work entitled to copyright protection and, at the same time, a registered design for the shape of the article would be protected under the Designs Act. If an unauthorised copy is made of the article, it may constitute an indirect copy of the drawing and therefore may infringe the copyright." [Emphasis supplied] 26. Similarly, in Mattel, Inc v. Jayant Agarwalla, 2008 SCC Online Del 1059 the plain....
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....riginal artistic work to reproduce the work in any material form. For example, a drawing of an imaginary futuristic automobile, which is an original artistic work, may be reproduced in three-dimensional material form using an element, such as a metal sheet. d. The design protection in case of registered works under the Designs Act cannot be extended to include the copyright protection to the works which were industrially produced. e. A perusal of the Copyright Act and the Designs Act and indeed the Preamble and the Statement of Objects and Reasons of the Designs Act makes it clear that the legislative intent was to grant a higher protection to pure original artistic works such as paintings, sculptures etc and lesser protection to design activity which is commercial in nature. The legislative intent is, thus, clear that the protection accorded to a work which is commercial in nature is lesser than and not to be equated with the protection granted to a work of pure art. f. The original paintings/artistic works which may be used to industrially produce the designed article would continue to fall within the meaning of the artistic work defined under Section 2....
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....se of this Act is protection of the intellectual property right of the original design for a period of ten years or whatever further period extendable. The object behind this enactment is to benefit the person for his research and labour put in by him to evolve the new and original design. This is the sole aim of enacting this Act. It has also laid down that if design is not new or original or published previously then such design should not be registered. It further lays down that if it has been disclosed to the public anywhere in India or in any other country by publication in tangible form or by use or in any other way prior to the filing date, or where applicable, the priority date of the application for registration then such design will not be registered or if it is found that it is not significantly distinguishable from known designs or combination of known designs, then such designs shall not be registered. It also provides that registration can be cancelled under Section 19 of the Act if proper application is filed before the competent authority i.e. the Controller that the design has been previously registered in India or published in India or in any other country prior t....
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..... Lord Reid (for himself and Lord Donovan) opined that: "There must be a blend of industrial efficiency with visual appeal. If the shape is not there to appeal to the eye but solely to make the article work then this provision excludes it from the statutory protection. I would add to avoid misunderstanding that no doubt in the great majority of cases which the Act will protect the designer had visual appeal in mind when composing his design. But it could well be that a designer who only thought of practical efficiency in fact has produced a design which does appeal to the eye. He would not be denied protection because that was not his object when he composed the design." [ Emphasis supplied ] 33. This decision was the first to draw a distinction in designs between 'features' and 'shapes' that were construed to be 'aesthetically appealing' to the eye of the consumer, in comparison to features that existed merely for 'purely functional purposes'. This demarcation based upon functional utility was further relied upon by the Judicial Committee of the Privy Council while interpreting the English Registered Designs Act, 1949, in Interlego A.G v. Tyco Industries Inc a....
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....ional utility test in Whirlpool of India Ltd. v. Videocon Industries Ltd., 2014 SCC OnLine Bom 565 wherein it has put forth that the 'conundrum of functionality may be resolved by taking note of the fact that it would make no impact on the article's functionality, if the function could be performed by the use of another shape as well'. 38. Interestingly, the Bombay High Court, in Photoquip India Ltd. v. Delhi Photo Store, 2014 SCC OnLine Bom 1088 appears to have adopted a conjunctive approach by interpreting Section 15(2) of the Copyright Act alongside the test of functional utility. While adjudicating the plaintiff's claim for an injunction to restrain the defendant from infringing its copyright in artistic works, a Learned Single Judge succinctly held that : "29. What is that to which Section 15(2) refers? It speaks only of a 'design', and not an 'artistic work'. It has no application to the latter, but only to the former. Section 2(d) of the Designs Act makes this plain, for it excludes from the definition of design all 'artistic works'. Therefore, the Defendants' argument must necessarily be that the Plaintiff's drawings are not artistic works at all, but are design....
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....a work is entitled statutory protection. One of the first such cases employing an approach of separating artistic expression from a utilitarian article was Mazer v. Stein. Mazer v. Stein, 347 U.S. 201, 74 S. Ct. 460, 98 L. Ed. 630 (1954). The US Supreme Court in that dispute examined the validity of copyrights granted to the respondents for statuettes of male and female dancing figures made of semivitreous china. The Court ruled that while the copyright owners could not prevent others from using statuettes of human figures in table lamps, they could prohibit direct copying of their specific copyrighted statuettes. 42. Though the court in Mazer (supra) did not explicitly use the term 'conceptual separability', but that was seemingly the foundation to bifurcate an artistic expression from a utilitarian article. In fact, the position of law developed in Mazer (supra) was subsequently incorporated by the US Congress in the Copyright Act, 1976, which postulated that: "Pictorial, graphic, and sculptural works" include twodimensional and three-dimensional works of fine, graphic, and applied art, photographs, prints and art reproductions, maps, globes, charts, diagrams, models,....
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....cteristic of industrial design is the non-aesthetic and utilitarian concerns, copyrightability ultimately should depend on the extent to which the work reflects artistic expression uninhibited by functional considerations. Brandir International, Inc. v. Cascade Pacific Lumber Co., 834 F.2d 1142 (2d Cir.1987); Pivot Point Int'l, Inc. v. Charlene Prods., Inc., 372 F.3d 913 (7th Cir. 2004). It was also laid down that a direct assessment needs to be conducted in this regard to exclude the general realm of industrial design while preserving the exclusive rights in 'applied art'. 46. Having said that, the Fifth Circuit sought to adopt a unique approach and followed the 'Likelihood of Marketability Approach' wherein conceptual separability would exist if there is a substantial likelihood that even if the article had no utilitarian use, it would still be marketable to some significant segment of the community merely owing to its aesthetic qualities. Galiano v. Harrah's Operating Co., 416 F.3d 411, 419 (5th Cir. 2005). It thus seems that there was a time when multiple tests were applied by American Courts to determine the copyrightability of useful articles. 47. The US Supreme Court, ....
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....(Berne Convention), was established to set legal principles for the protection of 'literary and artistic works'; across multiple jurisdictions. Berne Convention for the Protection of Literary and Artistic Works of September 9, 1886, completed at Paris on May 4, 1896, revised at Berlin on November 13, 1908, completed at Berne on March 20, 1914, revised at Rome on June 2, 1928, revised at Brussels on June 26, 1948, and revised at Stockholm on July 14, 1967 (with Protocol regarding developing countries). While industrial designs are mentioned within this broad classification, the Berne Convention primarily allows States to develop sui generis protection for such designs through their domestic laws. Notably, it does not elaborate on the overlap between design protection and copyright, leaving the matter largely to municipal legislation. 51. The most major development in the realm of multilateral treaties on IP rights, however, came with the adoption of the Agreement on Trade Related Aspects of Intellectual Property Rights, 1995 (TRIPS). TRIPS, 1869 U.N.T.S. 299 33 I.L.M. 1197. In comparison to the Paris Convention or the Berne Convention, TRIPS discusses 'industrial designs' in a fa....
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....ir own approaches. TRIPS, in particular, acknowledges the role of 'functional utility' in distinguishing protectable designs, thereby reinforcing the necessity of a nuanced approach at the domestic level. Consequently, the harmonisation of design and copyright protection remains largely a matter of national legislative policy. E.1.3. The final piece of the puzzle - the approach to be adopted 54. Having traversed the stratagem adopted across various jurisdictions and the key considerations that influence them, we see light at the end of the tunnel and deem it pertinent to outline our own definitive parameters that align with our existing IP right framework. 55. The expression 'artistic work' under Section 2(c) of the Copyright Act has a very wide connotation and may also include abstract work(s) comprising a few lines or curves arbitrarily drawn, which could be either two or three-dimensional. It may be clarified that such a work may or may not have any visual appeal. Further, the holder of such an artistic work is entitled to draw protection under Section 14(c) of the Copyright Act, including the exclusive right to reproduce such work in any material form. Such a reproduct....
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.... emulates the best practices employed by US courts and the principles enshrined in International Conventions but it also gives due consideration to contemporaneous laws and legislations. We have thus formulated a two-pronged approach in order to crack open the conundrum caused by Section 15(2) of the Copyright Act so as to ascertain whether a work is qualified to be protected by the Designs Act. This test shall consider: (i) whether the work in question is purely an 'artistic work' entitled to protection under the Copyright Act or whether it is a 'design' derived from such original artistic work and subjected to an industrial process based upon the language in Section 15(2) of the Copyright Act; (ii) if such a work does not qualify for copyright protection, then the test of 'functional utility' will have to be applied so as to determine its dominant purpose, and then ascertain whether it would qualify for design protection under the Design Act. 61. The courts, while applying this test, ought to undertake a casespecific inquiry guided by statutory provisions, judicial precedents, and comparative jurisprudence. It must be kept in mind that the overarching objective is to ensure th....
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....sary inquiry implies that a suit cannot be dismissed outrightly under Clause (d) of Order VII Rule 11 of the CPC solely based on a reading of the averments in the plaint. (b) The core dispute revolves around whether the 'Proprietary Engineering Drawings' qualify as drawings under Section 2(c) of the Copyright Act or whether they fall within the definition of a 'design' under Section 2(d) of the Designs Act, necessitating a detailed examination. (c) The Division Bench of the Delhi High Court in Microfibres II (supra), has laid down that the term 'artistic work' has a broad scope and may exist independently or as a precursor to a design. Additionally, a design derived from an artistic work may enjoy copyright protection, which ceases once it is industrially applied beyond the threshold set in Section 15(2) of the Copyright Act. Given these intricate distinctions, a more detailed analysis is warranted, and such determinations cannot be made at the very threshold. (d) Even if the drawing in question is not classified as an original artistic work, it does not automatically qualify for protection under the Designs Act. In such cases, it must be assessed whether....
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....s a legal issue in the written statement, it cannot be adjudicated through an application under Order VII Rule 11 of the CPC, as doing so would amount to pre-judging the matter. (i) In any event, the Suit encompasses additional claims relating to 'literary work,' confidential information, and know-how, which cannot be rejected in part. Even if the claim for copyright infringement is deemed untenable, the Suit would still be maintainable with respect to the other rights asserted. As a result, the entire Suit must proceed to trial, since a plaint cannot be partially rejected. 67. We are in complete agreement with the reasoning of the High Court that the question as to whether the original artistic work would fall within the meaning of 'design' under the Designs Act cannot be answered while deciding an application under Order VII Rule 11 of the CPC. This stage would involve only a prima facie inquiry as to the disclosure of cause of action in the plaint. The question pertaining to ascertaining the true nature of the 'Proprietary Engineering Drawings' involves a mixed question of law and fact and could not have been decided by the Commercial Court at a preliminary stage bas....