Ayur United Care LLP v. UOI: Where do Appeals from IPAB lie?

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[This post is authored by SpicyIP Fellow Yogesh Byadwal with inputs from Swaraj and Praharsh. Yogesh is a 3rd year B.A. LL.B. (Hons.) student at National Law School of India University, Bengaluru. He is interested in IP Law, Constitutional Law and Criminal Law. His previous posts can be accessed here.]

Recently on October 16, 2023, the Delhi High Court in Ayur United Care LLP v. UOI made important observations regarding the listing of writ petitions challenging orders passed by the (now abolished) Intellectual Property Appellate Board. The question for determination was whether writ petitions, challenging orders passed by the IPAB, filed before the abolition of the IPAB on 4 April 2021, would have to be heard by a Single Bench or by a Division Bench of this Court.

It held:

Rule 4, read with Rule 2(i) and 2(l) of the IPD Rules require writ petitions, challenging orders passed by the IPAB, to be decided by Single Judges…any hesitation or refusal, by the Single Judge, to hear these petitions, short of recusal, would amount to abdication of the judicial function vested in him.”

In this post, I will be focusing on the observations made by the court regarding the hierarchy between a Single Judge bench and the IPAB.

As a brief background, the order stems from a bunch of writ petitions filed against the IPAB order dated 28 June 2013, whereby the Board had allowed rectification petitions challenging the registration of the “Ayur” mark in favor of Ayur United Care (petitioner).

Does the Single Judge Step Into the Shoes of the IPAB?

The respondents argued that there would arise an ‘incongruous’ and ‘anomalous’ situation if challenges against rectification petitions filed between 2003 and 2021 before the IPAB would lie before a Single Judge bench of a High Court. Why? Because, as argued by the respondents, after the abolition of IPAB, status quo ante 2003 stood restored. In clear words, prior to 2003, rectification petitions were decided by a Single Judge bench. However, with the constitution of the IPAB in 2003, these matters were transferred to the IPAB. Therefore, IPAB was essentially exercising the very same jurisdiction that the Single Judge was exercising prior to the establishment of the IPAB. Therefore, the respondents argued that after the abolition of the IPAB, challenges against rectification petitions decided by IPAB would lie only before a division bench. 

The court termed the above argument to mean that a Single Judge “stepped into the shoes of the IPAB”. It denied the assertion of restoration of status quo ante. Rather, it held that when a Single Judge presides over a matter challenging the order by IPAB, they are not doing it as a successor of IPAB or IPAB in disguise. Instead, the decision rendered by the court is ‘pre-eminently the decision of the Single Judge’ which is not equal to the decision rendered by IPAB.

The court effectively repudiated the argument that there existed any parity between the jurisdiction exercised by IPAB and a Single Judge bench. It noted that a Single Judge bench of a High Court is “hierarchically or at least judicially superior authority” to IPAB. The court elaborated on this reasoning by explaining that while hearing and deciding a challenge to an order passed by the IPAB, the court is exercising supervisory jurisdiction as well as the jurisdiction of judicial review over the decision of the IPAB and while deciding upon an original rectification petition, the court is exercising its original jurisdiction vested in it by statute.

Based on the above findings, it appears that the court rejected the “stepping into the shoes” argument on two grounds-

First, by explaining that IPAB and a Single Judge bench do not stand on the same footing. Rather, the court emphasized the latter is judicially superior with supervisory jurisdiction over the former. In sum, it cannot be said that IPAB, in the judicial hierarchy, was equivalent to a Single Judge bench. As a result, the argument that a Single Judge has stepped into the shoes of the IPAB, and restored the status quo ante is erroneous.

Second, by interpreting the relevant provisions of the IPD Rules and the Delhi High Court Rules to conclude that a single judge bench is vested with the jurisdiction to hear writ challenges to an IPAB order. Giving wide interpretation to the term “IPR subject matter” the court first held that a writ challenging IPAB order will fall under the ambit of “IPR Subject matter” defined under Rule 2 (i) of the IPD Rules. Then, the court reasoned that the statutory mandate under Rule 4 of IPD Rules (prescribing the jurisdiction of the Single Judge to hear every case or proceeding concerning an IPR subject matter filed or transferred before the IPD), read in conjunction with Rule 1 in Part B in Chapter 3 of Volume V of the Delhi High Court Rules (prescribing the list of cases which are ordinarily heard by the Single Judge, including a writ petition), unambiguously requires that such writ petitions be necessarily heard by a Single Judge bench.

Though the court’s interpretation here seems to be on point, to properly understand the impact and merits of the order, it’s necessary to look at the relevant mechanism before the abolition of the IPAB.

The IPAB Era (2003-2021)

The Intellectual Property Appellate Board (IPAB) was constituted under the Trademarks Act, 1999 to hear rectification petitions, and appeals against the decisions of the Registrar and the Controller of Patents. While the substantive laws prescribed the mechanism of how these proceedings are to be conducted before the IPAB, no dedicated provision on the appeal against an order from the IPAB was given under any law (see third paragraph here). In fact, in the present case as well, though the High Court in para 17.4.3 observed that the single judge was acting as a superior authority while hearing “appeals” against the IPAB orders, it did not discuss under which provisions these “appeals” were filed earlier. Regardless, looking at this press release from 2019, explaining the solution for this lacunae, it seems like prior to the abolition of the IPAB, an aggrieved party could have filed a writ petition against the order of the IPAB before a High Court (and consequently before the Single Judge, as per Rule (xviii)(a), Part B, of the Delhi High Court Rules) under Article 226 or a Special Leave Petition before the Supreme Court.

Post 2021 (Abolishment of IPAB) and the Ensuing Anomaly

The enactment of The Tribunals Reforms (Rationalization and Conditions of Service) Ordinance 2021 abolished IPAB. The powers of IPAB with respect to revocation of patents u/s 64 of the Patents Act 1970 or to entertain rectification petitions u/s 57 the Trademark Act have now been transferred to the High Courts. Also, under Sec. 117A of the Patent Act, and Section 91 of the Trademarks Act appeals from the decision, order, or direction from the central government or the controller, as the case shall directly lie before the High Court.

Some of the key benefits of this move, as pointed out by Prashant here, are- First, the compulsory listing of the challenge before a Single judge bench gives another opportunity to provide diverse judicial viewpoints on the case by preventing any one institution from defining IP jurisprudence. Second, a roster system ensures against the possibility of the same judge sitting in appeal of cases. However, it is also pertinent to note that by the abolition of the IPAB, the three-tier mechanism of IPAB, Single Judge and Division Bench has been reduced to a two-tier system of Single Judge and Division Bench. Though the order attempts to trim the rough edges of uncertainty, by a literal reading of the IPD and the Delhi High Court Rules and surely clear the path for future cases while asserting the supremacy of its authority, it is still not immune from feeling the jitters of the ripple effects in the aftermath of the IPAB’s abolition. This is so because even after declaring the judicial supremacy over the IPAB and authority to hear the writ against the IPAB order, the order does not take into account the realistic anomaly whereby a writ challenging the IPAB order (which is the authority of first instance) passed in a revocation petition will lie before the Single Judge, whereas an appeal against the order of the Single Judge issued in a rectification will lie before the Division Bench. 

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