2022 (12) TMI 735 - HC - Customs

Import of goods - infringement of the Intellectual Property Rights of the plaintiffs - Seeking impleadment in the present suit as a proper party - Infringement of trade marks - violation of paragraph 2.3 of the Foreign Trade Policy, 2015-20 - HELD THAT - The Supreme Court in MUMBAI INTERNATIONAL AIRPORT PVT. LTD. VERSUS REGENCY CONVENTION CENTRE HOTELS PVT. LTD. ORS. 2010 (7) TMI 1159 - SUPREME COURT , has observed that the general rule with regard to impleadment of parties is that the plaintiff in a suit, being dominus litis, may choose the persons against whom he wishes to litigate and cannot be compelled to sue a person against whom he does not seek any relief. No relief has been sought against the applicant. The entire case of the plaintiff is based on the infringement of the trademarks of the plaintiffs by the defendant. Therefore, it cannot be said that an effective decree cannot be passed in the present suit in the absence of the applicant. It is not even the case of the applicant that the applicant is a necessary party, as the present application seeks impleadment only on the basis of the applicant being a proper party - In terms of the legal position, for a person to be a proper party to a suit, it is to be seen whether the presence of such person would enable the Court to completely, effectively and properly adjudicate upon the issue in the case. The applicant has the jurisdiction to determine if the seized goods are infringing the Intellectual Property Rights of the plaintiffs, only in the event of no legal proceedings being pending in relation to such determination. However, the present suit is such a legal proceeding in which a determination is to be made whether the goods imported by the defendant are infringing or not. Therefore, in terms of Rule 11 of IPR Enforcement Rules, the applicant cannot go into the question of infringement till the final adjudication of the present suit - In the event, this Court comes to a finding that the defendant has not infringed the trademarks of the plaintiffs, the said determination shall be binding on the applicant and there cannot be any question of destruction of the infringing goods. On the other hand, if a final determination is made by this Court that the goods have infringed the trademarks of the plaintiffs, appropriate orders shall be passed with regard to the aforesaid goods. The applicant is neither a necessary party nor a proper party for the adjudication of the suit. There is no merit in the present application and the same is dismissed.

Summary

Issues:
1. Application for impleadment filed by Commissioner of Customs seeking to be a party in a suit based on infringement of intellectual property rights.
2. Opposition by both plaintiff and defendant regarding the application.
3. Legal principles governing impleadment of parties in a suit.
4. Analysis of whether the Commissioner of Customs is a necessary or proper party in the present suit.

Analysis:
1. The application for impleadment was filed by the Commissioner of Customs based on the alleged infringement of intellectual property rights by the defendant through the import of goods. The applicant claimed that the goods imported were in violation of the Foreign Trade Policy and liable for confiscation under the Customs Act. The applicant sought to be impleaded as a party in the suit on this basis.

2. Both the plaintiff and defendant opposed the application for impleadment. The plaintiff argued that the suit was filed solely based on trademark infringement and that the applicant was neither a necessary nor a proper party for the adjudication of the suit. The plaintiff also highlighted that the applicant cannot proceed under the Intellectual Property Rights Enforcement Rules during the pendency of the suit.

3. The court referred to legal precedents to determine the criteria for necessary and proper parties in a suit. The court cited judgments such as Mumbai International Airport (P) Ltd. v. Regency Convention Centre & Hotels and Kasturi v. Iyyamperumal to establish the principles governing impleadment of parties. The court emphasized that the presence of a party should be necessary for effective adjudication of the issues involved in the suit.

4. After considering the arguments and legal principles, the court concluded that the Commissioner of Customs was neither a necessary nor a proper party in the present suit. The court highlighted that no relief was sought against the applicant in the plaint, which was solely based on trademark infringement. Additionally, the court noted that the applicant's involvement under the Intellectual Property Rights Enforcement Rules was subject to the final adjudication of the suit. Therefore, the court dismissed the application for impleadment, stating that there was no merit in the application.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved, the arguments presented by the parties, and the legal principles applied by the court in reaching its decision regarding the application for impleadment.