Teijin Limited v. Union of India
The text of the judgment can be found here.
The Bombay High Court has, in February, ordered the Patent Office to correct its record regarding the (non)payment of annuities and the corresponding lapse of the patent of the petitioners. The court observed that there was a “communication gap” between the petitioners and the Patent Office and it ordered the patent of the petitioners to be restored.
Facts of the dispute: The facts of the case are fairly simple. The petitioner’s 3rd to 9th year annuities were due to be paid, which they had done through their agents by means of a letter to the Patent Office. However, the letter made a mistake regarding the particulars of the subject matter, which they sought to rectify the very next day by means of a letter to the Patent Office. There was no communication from the Office with regards to this letter. Both of these letters were dispatched before the due date. Subsequently, the 10th year annuity payment was also made before the due date and was duly acknowledged by the office as the 10th year payment. In the 11th year, although the payment was made on time, the communication that the petitioners had issued to the Office stated mistakenly that the payment was for the 10th year and not the 11th year which was acknowledged by the Patent Office as the payment for the 10th year. When the petitioners attempted to pay their 12th year fee, the Office issued them a notice stating that their patent had lapsed for non-payment of the 11th year fee. The petitioners filed an application under S.60 of the Patents Act to restore their patent and produced all the relevant documentation but the Office held that the record could not be corrected as the clarifications could not be accepted, and informed them that the patent has been ceased. The petitioners approached the High Court in a writ under Art.226 of the Constitution of India.
Contentions of the parties: The contentions of the petitioners were that on initial payment of the 3rd to 9th year annuities there was an error that was committed which was sought to be rectified by means of a letter the very next day, which the Office had not acknowledged. This was within the six month period granted to patent holders to file annuities with the late fees if any, in order to prevent the lapse of the patent. Had the Office issued any form of communication at that time, then they could have acted within that six month period. Further, having accepted the 10th year annuity it was a reasonable assumption to make that the previous annuity had also been accepted. The mistake regarding the payment of the 11th year annuity was also merely a clerical error in the letter addressed to the Office. They had also raised a claim regarding the violation of the principles of natural justice as the Office had only heard the petitioner’s agents, and not the petitioners themselves.
The respondents argue that the petitioners had other remedies available before them such as the appeal of the order, and a proceeding before the High Court therefore was not maintainable. They also argue that the Inward Register of the Office proved that the alleged letter correcting the mistake in the letter for the payment of the 3rd to 9th year annuities was not received by them and therefore the fee itself could not have been deposited corresponding to the appropriate subject matter. A patent holder had a duty under law to deposit annuities and a failure to do so would have consequences under law. They also argue that the 10th year annuity was deposited at the Patent Office in Calcutta and was therefore irregular as it was submitted in the wrong jurisdiction.
Decision of the Court: The Court in holding that the suit was maintainable, ruled in favour of the petitioners and ordered that:
- The office was to restore the patent of the petitioners with a rider that they would give an indemnity to the Controller of Patents; and
- The petitioners were to state that they shall not file any suit or make any claim during the period from which the said Patent was treated ‘as ceased’ till the order passed by the Court and after a period of three months thereafter.
Reasoning of the Court: The court in its reasoning observed that the petitioners were in fact not given notice and merely their agents were heard. The Court also took note of the fact that the petitioners, due to a lack of communication on the part of the Office, were not allowed the benefit of the additional six months to pay the annuity as allowed by statute. Therefore a violation of the principles of natural justice was clearly made out and a writ under Art. 226 was maintainable.
The Court examined the inward register of the Office and held that it does not conclusively establish that the letter was not received by the Office. The court also sought to disregard the contention of the respondents that the annuity for the 10th year was filed in the wrong jurisdiction. The Court held that this was the perfect instance of where the Controller ought to have exercised his jurisdiction (under rules 129 and 137) to correct the record as it was merely a communication gap between the Office and the petitioners and it was the software of the Office that did not have an option to rectify the record. The court observed that S.62 precludes the petitioners from bringing any claim for the period when the patent was held to have been ceased. However strangely the court also ordered that for a three month period after the order of the court as well, the petitioners were precluded from bringing a claim. This is strange because it affects the rights granted by law to the petitioner in that three month period and also ousts the jurisdiction of another court or quasi-judicial body to hear a claim, which is fairly outside the powers of the court under Art.226, unless the court was giving this period of time to the Office to restore the patent.