TechnoLegal'er

USE OF TRADEMARKS AS SEARCHABLE KEYWORDS FOR TRIGGERING ADVERTISEMENTS ON SEARCH ENGINES

2012-06-03T15:51:00.000+05:30

Introduction

Online keyword advertising at search engines is a form of contextual advertising, and had become a very effective tool for online advertising. The keyword advertising is believed to be pioneered by Yahoo in 1996 when Chip Royce, marketing manager, wanted targeted advertising for the users who searched in by the keyword golf. After that the trend so started had been followed by many search engine operators and they have made it gradually a major source of revenue. Google has reported recently multibillion dollars as revenue from their popular service AdWords.

There had been various cases in last decade relating to such keyword advertising where the plaintiff had sued advertisers and also search engine operators for using trademarks to be used as searchable keyword for triggering the advertisements. The main contention of the trademark owners had been that trademarks cannot be used as searchable keywords as this enables the advertiser to free-ride over the goodwill of someone other’s trademark. Also, the trademark owners contend that by using trademarks as searchable keywords for advertising, the advertiser gets a direct and easy access to the trademark owner’s hard earned customer’s interest in his product, and diverts it to the advertiser’s own products. This allegedly amounts to unfair competition and some passing off of trademark.

Dealing with such cases, the courts across globe had opined their view on case to case basis. None had explicitly declared that whether such use of trademark, i.e. using trademarks as searchable keywords for triggering advertisements, amounts to any kind of trademark infringement or not.

The researcher, not taking side on either sides, here puts forth some issues which must be looked into while deliberating upon the matter.

First, we will get a brief about know-how of Keyword Triggered Advertising. Then we will address the issue and deal with the gray areas related to the issue, where clear stand is still to be taken. Apart from theoretical arguments we will discuss a few example and analogies which are applicable in the matter. And at last the conclusion.

How keyword triggered advertising works?

A marketer who advertises the product chooses certain keywords or combination of keywords and registers them with the search engine. Whenever an internet user, searches anything on the search engine using a string of text, and if that string comprises any of these registered keywords, the advertiser’s advertisements gets triggered and gets displayed on the same page where search results are displayed for the said search string. An illustrative example is depicted below where, on Google, a user searches for the word ‘jeans’. As you can see, on the right hand side of the search results, advertisements are displayed.

The Controversy

This tool of keyword advertising on search engines had been in controversy for long for use of trademarks as the searchable keyword for triggering advertising by the advertisers. There had been cases where the trademark owners have sued the advertisers as well as the search engine owners for various claims like initial interest confusion[1], unfair competition, misrepresentation in commercial advertising, dilution of trademark, loss of reputation, unjust enrichment, etc.

The marketers who allege these claims have few basic contentions. For e.g., that the advertisers are exploiting the trademark’s value and goodwill in market to advertise their own products. Which, in a manner, amounts to free-riding by the advertisers on the efforts all done by the trademark owner.[2]

To comprehend better let us look into the following hypothetical example. Fiat registered the keyword ‘Fiat Linea’, which is a trademark owned by Fiat as a keyword with Google Adwords. Now when a search engine user searches for ‘Fiat Linea’ (a car by Fiat), then along with the search results, and advertisement for ‘Maruti Suzuki’s SX4’ appears on the same webpage, just because the user had used ‘Fiat Linea’ as keyword. Now ‘Fiat’ claims that Maruti Suzuki is:

a) creating confusion in the users mind that Fiat Linea and Maruti Suzuki SX4 are linked in some manner, i.e. initial interest confusion

b) getting benefitted by the marketing efforts done for Fiat Linea by Fiat, thus getting unjust enrichment.

c) using ‘Fiat Linea’ trademark for selling its own products, which amounts to commercial use of the trademark which belongs to Fiat and thus amounts to trademark infringement.

d) the advertiser poses unfair competition to the trademark owner by targeting prospective customers who are interested and search for the trademark owner’s product.

These few issues are apparently the core of the controversy, that whether trademarks should be allowed to be used as keywords to trigger advertisements.

Here let us be clear that this thesis does not deal with issues which are already deliberated and decided upon by the courts. These are the cases in which the trademark has been used not just for triggering advertisements but are also depicted in the text of the advertisement including the webpage links along with the advertisements. This thesis also excludes deliberating upon the cases where the trademark is used for the re-selling purpose of the products of trademark owner.

Initial Interest Confusion

Initial Interest Confusion is a legal doctrine under trademark law that permits a finding of infringement when there is temporary confusion that is dispelled before the purchase is made. Generally, trademark infringement is based on the likelihood of confusion for a consumer in the marketplace. This likelihood is typically determined using a multi-factor test that includes factors like the strength of the mark and evidence of any actual confusion.

There are four cases where courts have examined this issue, the result has turned on whether the brand owner's mark appeared in the sponsored ads. In 2005, Geico sued Google for selling keywords containing the Geico mark[3]. The ads shown below were triggered by a search for Geico. Some of the sponsored ads contained the Geico mark, while others did not.

The court said ads containing Geico mark (left) were likely to confuse people while those that didn't (right), weren't likely to confuse. Because the court did not discuss any possible exceptions for "fair" uses of the Geico mark in the ads, it appeared to impose a "strict liability" test of whether or not an ad contained the mark. Consistent with the Geico case, some courts have ruled that as long as the trademark is not in the advertiser's sponsored ads, there's no infringement[4].

The dispute in the matter is based on assumption that a search engine user, when makes a search, where the search string comprises the trademark, he is searching for the trademark owner’s product’s information.

First, researcher avers that it is just an assumption, that the user, when uses a certain trademark name for searching on a search engine, is specifically looking for that particular product or its information only. What if one searches with the words ‘Cars like TATA Nano’? When a person searches using words ‘TATA Nano’(an automobile product by TATA) on any search engine, he may be searching for the class of cars in the category of which TATA Nano belongs. Because he may not know what that particular product segment is called, to which TATA Nano belongs, to use it as keyword for his searching. Or he may be searching for any other cars if any are there in that product segment. But in this case, if the keyword advertising is not allowed, the user of the search engine will not be able to see the advertisements from the competitors of TATA Nano, about whom he explicitly intends to know.

However, the contention that keyword advertising creates confusion only holds good in the cases in which the advertiser uses the trademark of the competitor in his own triggered advertisement[5]. In a case the defendant used the trademark ‘Smart Money Clip’ as the heading of its advertisement, which was held confusing to ascertain the source of the product offered in the advertisement.

But the contention holds baseless in other cases where advertisements are totally explicit and are certain or easy to ascertain the source of the products through the advertisements. Because the way the ads are displayed, totally demarcates and differentiates advertisements from search results. For instance, in Google AdWords, such advertisements are displayed in a separate column of a page on which at the top of the column it is explicitly visible ‘Ads’ or ‘Sponsered Links’[6]. Same in the case of Yahoo, Bing and other popular search engines. There also is a column line which separates search results from the ads displayed. So, as far as the contention of confusion is concerned, it is taken care will by the search engine owners which had been recently brought to the court by the plaintiffs.

Trademark Infringement

Now another contention is that the keyword advertiser gets benefited by the goodwill and marketing efforts of the trademark owner to get its products advertised, which leads to unjust enrichment to the advertisers.

What if Pepsi comes up with a marketing plan that they will install or hire bill-boards near every Coca-Cola outlet and advertise Pepsi on them? Will it be called an immoral or unethical marketing practice? Earlier doing the same was not possible because of many constraints due to lack of resources and technology. But now the internet world had made it possible by just a click of effort. Therefore Pepsi has full right to post any such billboards wherever they want, Coca-Cola is not entitled to oppose such gorilla marketing efforts by any of his competitors including Pepsi, unless it is in direct conflict with laws of the territory.

I would rather say that the keyword advertising, specifically when trademarks are used as keywords, augments the government’s efforts to foster a perfectly competitive market and helps customers to get knowledge about the products in the market in a more easy way. If a prospective customer searches for Fiat Linea and in the process, without any efforts also comes to know about various other products which lie in competition to Fiat Linea, then isn’t it favorable to customers, getting them well informed and knowledgeable about the products available in the market? On the same hand it will also foster the culture of making marketers sell their goods by the virtue of the value in their offering, rather than the marketing efforts and puffery advertisements they put to attract customers.

Unjust Enrichment

Let us take another revealing example. Let us compare the keyword triggered advertising process to a situation in a supermarket. Lets assume Hindustan Lever (HL) extensively markets a luxury soap. A customer, gets interested in that product and goes to supermarket to buy the soap. When he goes to the supermarket searching for the HL’s luxury soap, he also comes accross to see Baba Ramdev Pharmacy’s (BRP) Soap lying in the same shelf. The question here arises that; Is BRP getting unjustly enriched when customer sees BRP’s products lying in the shelf? No, certainly not. Because in this case the customer has come to see the HL product in the supermarket, not to a exclusive showroom of HL. It cannot be assumed in every case that a customer will be looking for an exclusive showroom for seeing HL’s products.

Similarly search engines is an independent part of internet world and is everyone is free to sell their own products. If search engines display advertisements to the users of his own search engine there should be no hindrance for them doing so. After all, a search engine is just another market place with free market policy and not some entity which is bound to take care of special interest of any other business entity. Similarly, as the customer intends, he is able to see the HL product lying the shelf. BRP’s products are just visible to the customer because they also exist in the market for the customers.

In the same way when a person searches for Fiat Linea on a search engine, the marketing efforts by TATA for Fiat Linea are taken care by the search results which appear on the left hand side of the screen. If TATA had done enough marketing on online media then the very first entry in the search result will direct the search engine user to the most relevant website for getting pertinent information on Fiat Linea. So there lies no question of any damage done to the goodwill and efforts in marketing by the trademark proprietor in this case.

In the earlier example of HL and BRP, another question arises; Can Hindustan Lever ask the supermarket owner to not to put Hindustaan Lever and BRP’s products on the same shelf or remove BRP’s products from the shelf on which HL’s products are kept? No he cannot. Because if Hindustaan Lever does so, he will be asking the supermarket owner to provide a pseudo exclusive showroom environment for each customer coming to supermarket searching for HL’s soap, and that too without any consideration in return for the supermarket owner. Further, if the supermarket owner satisfies any such request by HL, then HL will get unjustly enriched by getting an exclusive showroom of its products without any extra efforts. And on the same hand it will be detrimental to the efforts done by BRP in making its products accessible to the customer by making them available in the supermarket. So, basically if HL asks the supermarket owner to remove BRP products from the shelf, then HL will be violating the various norms established in anti-monopolistic and unfair trade practices statutes in force in various countries in world, by making efforts to unscrupulously prevent the customers from getting knowledge about other products in the market. So to make it more clear, it’s the plaintiff who will get unjustly enriched if the trademark keyword searching is not allowed to the competitors.

We can rightly extrapolate from the above arguments that the plaintiffs should actually pay the search engines to not to display competitor’s advertisement when a user searches using their trademarks as keywords. At least this will make the trademark owners pay something in order to get an exclusive showroom environment on that particular search engine.

Ultimately the grund norm is that internet is market place. If customer approaches a market searching for any particular product, he or she has full right to know about various other products available in the market which can satisfy his or her requirements. And on a medium like internet, where search engines are the door to find and reach the websites, it will not be possible unless the customer knows the domain name or product name of each and every product in the market. Not allowing such keyword advertising will only conceal such existence of other substitute products. This will again amount to unfair trade practice. So to know about the alternative to the products he is intending to buy or seek information for, keyword triggered advertisements, specifically using trademarks as searchable keywords, are the most simplified manner which benefits both the consumers and the marketers, that too without making any significant damage to the goodwill or reputation of the competitors. And ultimately it is no doubt that the whole idea behind the system of facilitating the trademark protection is to prevent unfair use of trademarks. Not to help trademark owners to put a veil on the existence of their competitors in the market.

Now let us discuss a few landmark judgments on the issue in European Union (EU) and India

Google France v Louis Vuitton (2010)[7]

This case was filed by a group of companies under the big umbrella of LMVH[8]. There were different claims by these companies against Google’s AdWords. They claimed that Google allowed their trademarks to be used by advertisers to trigger the advertisements. Secondly they claimed that Google displayed identical trademarks in the third party advertisements.

In this landmark case on the issue of trademarks as searchable keywords to trigger advertisements, the highest court in EU ruled that Google cannot be held liable for the trademark infringement, if any done, unless Google’s active role is proved in infringement of the trademark.

In this famous case the court held the following rulings.[9]

a) When Google allows the advertisers to choose and use the trademarks for triggering advertisements, it cannot be said that Google had used the trademark. It is the advertisers who are actually using the trademarks. So Google cannot be held liable unless an active role of Google is proved in such infringement. It is the third party advertisers who are liable to be sued for such infringement if any.

b) Onus is on trademark owners to make it come to the knowledge of Google of such infringement, and if proved then Google is obliged to remove such advertisements. Google can only be held liable if it knowingly allows infringing advertisements to get displayed.

c) The court also held that the use of a trademark by third party, should only be such that it facilitates the customers with knowledge of other alternative products available in the market. The third party advertisement should not use the trademarks in the body of their advertisement so as to create confusion in mind of the customer about the origin and source of the product so displayed in the third party advertisement.

d) The court ruled that all further cases of such claim of infringement should be dealt case by case by the national courts. And search engines are allowed to sell trademarks as keywords.

e) The third party advertisers when using the trademark of some other person should disclose the origin and the source of the goods they are offering with certainty.

After this ruling, search engine operators got relieved to a great extent as they were continuously sued for various such cases in last decade.

So after a lot of obscurity on the issue the EU court in Luxemburg made the situation crystal clear that the Trademarks should not be used in the third party advertisements, so as to cause a commercial use of the trademark owned by other, by referring to a precedent case.[10]

Consim Info Pvt. Ltd. v Google India Pvt. Ltd. and Ors.

The Google Adwords controversy hit India in 2009 when Consim Info which runs BharatMatrimony.com got temporary injunction from Madras High Court[11], against Google India alleging the same trademark infringement and unfair competition. Consim Info alleged that Google and the competitors of BharatMatrimony.com, allegedly Jeevansathi.com, SimplyMarry.com, are using its trademarks to trigger the advertisement on the search engine. Consim Info mentioned a list of various trademarks of which it is owner. These trademarks consisted of terms like AssameseMatrimony, BengaliMatrimony, TamilMatrimony, PunjabiMatrimony, etc.

At the appeal for injunction by Consim Info, concerning the propensity of the internet world, Madras High Court granted temporary injunction against Google restraining it from displaying such advertisements.

But in the recent judgment on the same case by the Madras High Court on 30^th September 2010,[12] the court delivered the judgment on the same lines as European Union, vindicating Google and Others from the trademark infringement allegation by Consim Info. The court meticulously recorded the catharsis of the evolution of the rulings from past to till date related to the issue – “Trademarks as searchable keyword on search engines to trigger advertisements”.

The court also held that that words Bharat, Matrimony, Tamil, etc are generic words. If these words will be prohibited from use as searchable keywords then there will be left very less options for both search engine users and the advertisers. So the claim on these generic words, like Tamil, Assammeese, Bengali, Matrimony etc., for which almost no synonyms are there, is unjustified.

Search engine is an information provider. When any search is made on search engine, the search engine replies with all relevant information available on internet related to the search string. We can see search engine as a broker of information. Search engine is an independent business entity on itself, which provides information to the user. It is to be noted that search engine is an independent business entity in itself and it provides the information service to its users free of cost.

Press Release-Court of Justice of the European Union

As per very recent press release on 22^nd September 2011, any court across world has first time opined on the matter discussed in this thesis. The press release was done after close to five months of a case decided by the court[13], when the judgment lead to a lot of controversy regarding some issues which are the heart of this thesis.

The press release clarifies following points:

o “The Court observes that the trade mark’s function of indicating origin is adversely affected where the advertisement displayed on the basis of the keyword corresponding to the trade mark does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the advertisement originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party. However, use of a sign identical to another person’s trade mark in a referencing service such as ‘AdWords’ does not adversely affect the advertising function of the trade mark.”[14]

o “The Court also considers, for the first time, the protection of the trade mark’s investment function. Thus, the use by a competitor of a sign identical to the trade mark in relation to identical goods or services has an adverse effect on that function where that use substantially interferes with the proprietor’s use of its trade mark to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty. In a situation in which the trade mark already enjoys a reputation, the investment function is adversely affected where such use affects that reputation and thereby jeopardises its maintenance.”

o “It cannot be accepted that the proprietor of a trade mark may prevent such use by a competitor if the only consequence of that use is to oblige the proprietor of the trade mark to adapt its efforts to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty.”

o “Where the advertisement displayed on the internet on the basis of a keyword corresponding to a trade mark with a reputation puts forward an alternative to the goods or services of the proprietor of the trade mark with a reputation – without offering a mere imitation of the goods or services of the proprietor of that trade mark, without causing dilution of the trade mark or detriment to its repute (tarnishment) and without, moreover, adversely affecting the functions of the trade mark – such use falls, as a rule, within the ambit of fair competition in the sector for the goods or services concerned.”

Perusing these cited text from the press release, it can be observed that, for the first time, any court across world has first time ever opined on the matter whether trademarks can be used as searchable keywords on search engines for triggering advertisements.

Conclusion

Thus after a long period of uncertainty and inconsistency in the judgments in the last decade about the issue, courts made their stand clear. That use of trademarks as searchable keyword for triggering advertisements is not trademark infringement, or unfair use. Even if any wrong is done by the advertisers in process, then only the advertisers are liable to be sued, not the search engine operators, unless there is active involvement is proved on the part of the search engines.

Courts held that, this way of advertising is in consonance with the welfare of the customers, and fostering of competition in the market. The contention that goodwill and reputation of marketers are free-ridden by making such use of trademarks is also rendered futile as the court was clear to assert that that the goodwill and reputation are taken care by the natural search results on the search engine.

On the same hand court also provided the chance of fair trial to each plaintiff so coming in future by declaring that in future such cases should be dealt on case by case basis by the courts, and the degree of wrong being should be ascertained on case by case basis based on the facts of the cases.

[1] “Initial interest confusion occurs when the defendant uses the plaintiff’s trademark in a manner calculated to capture initial consumer attention, even though no actual sale is finally completed as a result of the confusion.” Interstellar Starship Services, Ltd. v. Epix Inc., 304 F. 3d 936, 941 (9th Cir. 2002)

[2] Google France Sarl v Louis Vuitton Malletier SA, [2010] R.P.C. 19

[3] Government Employees Insurance Co. (GEICO) v. Google, Inc., 330 F.Supp.2d 700

[4] Government Employees Insurance Co. (GEICO) v. Google, Inc., 330 F.Supp.2d 700

[5] Storus Corp. v. Aroa Marketing Inc., [2008] WL 449835.

[6] See the image rendered in section How it works?

[7] Google France Sarl v Louis Vuitton Malletier SA, [2010] R.P.C. 19

[8]LVMH stands for Moët Hennessy • Louis Vuitton, which is group of various luxury brands in EU.

[9] Supra, n 2

[10] O2 Holdings Ltd v Hutchison 3G Ltd, [2008] R.P.C. 33

[11] Consim Info Pvt. Ltd. v Google India Pvt. Ltd., People Interactive Pvt. Ltd. , Jeevansathi Internet Services Pvt. Ltd. and Times Business Solutions Ltd., MANU/TN/2523/2009.

[12] Consim Info Pvt. Ltd. v Google India Pvt. Ltd. and Ors, MANU/TN/1816/2010.

[13] Interflora Inc., Interflora British Unit v. Marks & Spencer plc, Flowers Direct, [2010] EWHC 925 (Ch)

[14] Court of Justice of the European Union, Press Release No. 97/11, Luxembourg, 22 September 2011

A.R. Antulay v. R.S. Nayak (1988)

2011-11-17T19:02:00.001+05:30

STATEMENT OF FACTS

FACTUAL AND PROCEDURAL BACKGROUND
1. The appellant became the Chief Minister of Maharashtra on 9th June 1981.
2. On 1st September the same year, respondent no.1, a member of the BJP, applied for sanction from the Governor of the state under Section 197 of the Code of Criminal Procedure Code, 1973 (hereinafter “The Code”) and Section 6 of the Prevention of Corruption Act, 1947 (hereinafter “The Act”) to prosecute the appellant.
3. Meanwhile respondent no.1 filed a complaint before the Additional Metropolitan Magistrate, Bombay against the appellant and others, under Sections 161 and 165 of the Indian Penal Code (hereinafter “The IPC”) as well as Sections 384 and 420 read with Sections 109 and 120B of the IPC and Section 5 of the Act.
4. On the refusal of the learned magistrate to take cognizance of the complaint under Sections 161 and 165 of the IPC and Section 5 of the act in absence of a sanction, a criminal revision application was filed in the High Court of Bombay.
5. The Division bench held in favour of the appellant and ruled that a sanction was necessary to prosecute the appellant. It rejected a request for transfer of the case from the Additional Metropolitan Magistrate to itself. Meanwhile, the appellant had resigned from his post of Chief Minister on 12th January, 1982.
6. Respondent no. 1 was granted sanction under Section 197 of the Code by the Governor on 28th July, 1982 in respect of five items relating to three subjects only. Later on 9th August, he filed a fresh complaint before the learned Special Judge, registered as Case no. 24 of 1982.
7. Respondent no.1 brought in many more allegations than those for which sanction was granted. He contended that sanction was not necessary since the appellant had ceased to be a public servant after resigning as CM.
8. The Special Judge, Shri P.S. Bhutta, issued process to the appellant ignoring the sanction and later overruled the appellant’s objection to his jurisdiction to take cognizance of the matter and issue process in the absence of a notification under Section 7(2) of the Criminal Law Amendment Act, 1952 (hereinafter “The 1952 Act”). The notification would have specified which of the three special judges of the area should try the case.
9. On 15th January 1983, the State Government appointed Shri R.B. Sule as the Special Judge to try offences specified under Section 6(2) of the 1952 Act. He discharged the appellant on 25th July 1983 stating the appellant was still a public servant being an MLA and there was no valid sanction to try the appellant.
10. This resulted in an appeal under Article 136 of the Constitution of India by respondent no. 1. It was held therein that an MLA is not a public servant and the order of Special Judge Sule was set aside. The cases were transferred by the Supreme Court to the Bombay High Court with a request being made to the honourable Chief Justice to appoint a sitting judge of the High Court to hold trial of the two cases (no. 24/82 and 3/83, filed by one P.B. Samant).
11. Thereafter the cases were assigned to S. N. Khatri, J., who rejected the objections of the appellant in respect of his jurisdiction.
12. A writ petition filed thereafter by the appellant in 1984 was dismissed by this court and it was held that it was the duty of the learned judge to follow the directions of this court.
13. The cases were then transferred to Shri D.N. Mehta, J. who framed charges under 21 heads and declined to frame charges under 22 other heads. In an appeal by special leave preferred by respondent no.1, this court directed the high court to frame charges with regard to all offences except those under Section 384 of the IPC. A direction to replace Shri Mehta with another judge was also passed.
14. P.S. Shah, J. replaced Shri. Mehta on 24th July 1986 and proceeded to frame 79 charges against the appellant, but not against any other co-conspirator.
15. Thereafter two appeals by special leave and one writ petition challenging the constitutionality of a portion of Section 197(1) of the Code were filed at this court by the appellant. Leave for the first appeal was granted and the other appeal and petition were delinked from this case to be considered by independent benches of this court.

ISSUES RAISED

I. Whether the appeal under Article 136 of the Constitution of India is maintainable?
II. Whether a case triable only by a special judge under the Criminal law Amendment Act, 1952 can be transferred to the High Court for trial by itself or by this court to the High Court for trial by it?

SUMMARY OF ARGUMENTS

I. WHETHER THE APPEAL UNDER ARTICLE 136 OF THE CONSTITUTION OF INDIA IS MAINTAINABLE?

A. The judgment was passed without jurisdiction

B. A decree passed by any court without jurisdiction is nullity.

II. WHETHER A CASE TRIABLE ONLY BY A SPECIAL JUDGE UNDER THE CRIMINAL LAW AMENDMENT ACT, 1952 CAN BE TRANSFERRED TO THE HIGH COURT FOR TRIAL BY ITSELF OR BY THIS COURT TO THE HIGH COURT FOR TRIAL BY IT.

A. Criminal Law (Amendment Act), 1952 ousts the applicability of any provision of Criminal Procedure Code which is in contravention to the provisions stipulated therein.

B. There is no other provision in any other statute in force which vests an authority which justifies the transfer of the case made as such.

ARGUMENTS ADVANCED

I. Whether the appeal under Article 136 of the Constitution of India is maintainable?

1. The doctrine of res judicata is applicable for the judgments which are valid. The appellant come to this court to challenge the validity of the judgment passed and not to reopen the issued decided therein.
2. The basic premise on which the appellant herein comes to the honourable Supreme Court is that the judgment in question, which was passed against the appellant, is subject to nullity hailing to the absence of jurisdiction of the court in the matters decided therein.
3. In Kiran Singh and Ors. v. Chaman Paswan and Ors , Venkatarama Ayyar, J. observed that the fundamental principle is well established that a decree passed by a Court without jurisdiction is a nullity, and that its validity could be set up whenever and wherever it is sought to be enforced or relied upon-even at the stage of execution and even in collateral proceedings. A defect of jurisdiction whether it is pecuniary or territorial, or whether it is in respect of the subject-matter of the action, strikes at the very authority of the Court to pass any decree, and such a defect cannot be cured even by consent of parties.
4. Hence, the appellant comes to contest on a critical matter of law, with respect to the procedure of law, as exercised by the court in the questioned judgment. The appellant come to this court under art. 136 of Constitution of India.

II. Whether a case triable only by a special judge under the Criminal Law (Amendment Act), 1952 can be transferred to the High Court for trial by itself or by this court to the High Court for trial by it?
5. Section 7(1) of the 1952 Act creates a condition which is sine qua non for the trial of offences under Section 6(1) of the said Act. The condition is that notwithstanding anything contained in the CrPC or any other law, the said offences shall be ‘triable by Special Judges only’. Indeed conferment of the exclusive jurisdiction of the Special Judge is recognised by the judgment delivered by this Court in A.R. Antulay v. Ramdas Sriniwas Nayak and Anr. where this Court had adverted to Section 7(1) of the 1952 Act and observed that Section 7 of the 1952 Act conferred exclusive jurisdiction on the Special Judge appointed under Section 6 to try cases set out in Section 6(1)(a) and 6(1)(b) of the said Act. In spite of this while giving directions in the other matter, that is, R.S. Nayak v. A.R. Antulay , this Court directed transfer to the High Court of Bombay the cases pending before the Special Judge. It is true that Section 7(1) and Section 6 of the 1952 Act were referred to while dealing with the other matters but while dealing with the matter of directions and giving the impugned directions, it does not appear that the Court kept in mind the exclusiveness of the jurisdiction of the Special Court to try the offences enumerated in Section 6. Hence, the directions of the Court were given per incuriam.
6. It is submitted before honourable court that the directions of the Court were given per incuriam, that is to say without awareness of or advertence to the exclusive nature of the jurisdiction of the Special Court and without reference to the possibility of the violation of the fundamental rights in a case of this nature as observed by a seven Judges Bench decision in The State of West Bengal v. Anwar Ali Sarkar .
7. Section 7(1) of the Act required the offences involved in the case to be tried by a Special Judge only, and Section 7(2) of the Act required the offences to be tried by a Special Judge for the area within which these were committed which condition could never be satisfied as there was a transfer. Hence, the condition in Sub-section (1) of Section 7 of the Act that the case must be tried by a Special Judge, is a sine qua non for the trial of offences under Section 6.
8. The third sub-section of Section 8 of the Act preserves the application of any provision of the Code if it is not inconsistent with the Act save as provided by the first two sub-sections of that Section.
Section 7 of the 1952 Act provides that ‘notwithstanding anything contained in the CrPC, or in any other law the offences specified in Sub-section (1) of Section 6 shall be triable by Special Judges only’ . By express terms therefore, it takes away the right to transfer cases contained in the Code to any other Court which is not a Special Court. And therefore, the power under section 406 and 407 of the code, which are in contraventions to the 1952 Act, could not be exercised in this case . Thus, the transferring the case in such manner for a speedier trial by the High Court for an offence of which the High Court had no jurisdiction to try under the Act of 1952 is contended to be unwarranted, unprecedented and the directions given by this Court for the said purpose, were not warranted.
9. Hence, in view of the clear provisions of Section 7(2) of the 1952 Act and Articles 14 and 21 of the Constitution, these directions are contended to be legally wrong.
10. The fact that the objection to the order of transfer of case was not raised before this Court giving directions on 16th February, 1984 cannot amount to any waiver. In Meenakshi Naidoo v. Subramaniya Sastri , it was held that if there was inherent incompetence in a High Court to deal with all questions before it then consent could not confer on the High Court any jurisdiction which it never possessed.
11. Also, in Trilok Chand v. H.B. Munshi , it was noted
“...The right to move this Court for enforcement of fundamental rights is guaranteed by Article 32. The writ under Article 32 issues as a matter of course if a breach of a fundamental right is established. But this does not mean that in giving relief under Article 32 the Court must ignore and trample under foot all laws of procedure, evidence, limitation, res-judicata and the like.”
12. On the ratio of the seven-Judge Bench decision of this Court in the State of West Bengal v. Anwar Ali Sarkar the vires of this Act are not open to challenge. The majority of the learned Judges in Anwar Ali Sarkar's case expressed the view that it was open to only to the Legislature to set up a special forum for expedient trial of particular class of cases. Section 7(1) has clearly provided that offences specified in Sub-section (1) of Section 6 shall be triable by the Special Judge only and has taken away the power of the courts established under the CrPC to try those offences. Section 10 of the Act required all pending cases on the date of commencement of the Act to stand transferred to the respective Special Judge. Unless there be challenge to the provision creating exclusive jurisdiction of the Special Judge, the procedural law in the Amending Act is binding on courts as also the parties and no court is entitled to make orders contrary to the law which are binding as long as Section 7 of the Amending Act of 1952 hold the field it was not open to any court including the apex Court to act contrary to Section 7(1) of the 1952 Act.

Rambihari and Ors. v. State of Madhya Pradesh [(2004) 2 MPHT 430]

2011-04-08T11:00:00.000+05:30

STATEMENT OF FACTS

1. In the intervening night of 15^th and 16^th March, 1987 accused Rambihari, Ramswarup, Kallu and Devideen committed murder of Ghuram in furtherance of their common intention after hatching a conspiracy.

2. Goli, father of Ghuram, and sullu were also killed by the accused persons to take revenge of the murder of Manku, who was father of the accused Rambihari and Ramswarup.

3. Ghuram was also meted out the same treatment by the accused persons so that later on he may not avenge the death of his father Goli.

4. The accused persons has been acquitted for the charge of committing murder of Goli and Sullu.

5. The dead body of Ghuram is said to have been buried under the debris by the accused persons in the outskirts of village Sarani.

6. It has been alleged that in the intervening night of 15^th and 6^th march 1987, accused Rambihari Ramswarup, Kallu and Devideen commited murder of Ghuram.

7. The details of the incident as extablished in the trial court are:
Accused Kallu took Ghuram from his house to the forest on the pretext of searching his father. On the way accused Devideen accompanied them. They went to a place where accused Rambihari and Ramswarup were standing with a bullock-cart. Rambihari had an axe and Ramswarup was armed with a Bhala. They caused injuries to Ghuram with these weapons. He fell down and died. Then they buried his dead body under the debris. Their clothes were stained with blood.

8. Kallu was turned to witness from accused by granting him pardon under section 307 of Criminal Procedure Code 1973. And his statement was recorded on 12-1-1987 by the trial court.

9. Kallu was examined as a witness during the trial after the pardon was granted to him. Its primarily on the basis of his testimony that the appellants have been convicted under section 302/34 and section 120B of Indian Penal Code 1860. Appellant no. 2 Ramswarup has died during the pendency of this appeal.

ISSUES RAISED

Whether the Evidence given by kallu can be relied upon for conviction?

ARGUMENTS ADVANCED

I. Whether Evidence given by Kallu can be relied upon?

1. With due respect it is submitted before the Honorable High Court of Gujraat, that the evidence of Kallu is totally reliable as there enough are provisions in the law supporting the validity of the evidence and there is absence of any provision for the contrary.

Lack of any reason to doubt the evidence

2. It is established that Kallu was friend of the deceased. It is to be noticed that Kallu was asked by Ghuram’s (deceased) mother to accompany him to search for Ghurams’s father. So for Kallu it has to be substantial mens rea to make him a conspirator in the crime. And according to facts of the case there not even a remote hint which suggests that Kallu might be willing to kill Ghuram.

3. Further, it has to be noted that Kallu was neither brother, nor friend of Rambihari and Ramswarup. The only connection he had was with the deceased and that too of friendship. Even mother of the deceased trusted Kallu, him being friend of Ghuram. So Kallu, being a reasonable man, had no reason whatsoever to be an approver of the offence done by Rambihari and Ramswarup.

4. It has to be noted in the case that evidence given by Kallu was solicited in special circumstances. As there was no other evidence available for the proceedings of the case, the court decided to bring in evidence for the prosecution by using section 307 of CrPC. The co-accused Kallu was granted pardon on the condition that he will give full truthful disclosure of all the facts and evidence in his knowledge[1]. So in such case there is no indispensible need of further corroboration of the evidence given by Kallu. Also, there is sheer lack of even a single other circumstance or evidence, whatsoever, which raises a doubt about the Kallu’s deposition before the court.

5. Considering the fact that Kallu’s statement has been duly cross examined by the defense with all possible measure, there remains no further question as to the reliability of the evidence given by Kallu.

6. Another important point to be noted is that, after the pardon has been granted to Kallu, there is no mens rea left for Kallu to depose wrongfully before the court. And also there is section 308 of CrPC[2] which is good enough a reason for Kallu to refrain from giving any false evidence.

Legal provisions supporting the validity of Kallu’s Evidence

7. Firstly, as per section 307 read with section 306 of CrPC suggests that pardon is granted to a co-accused on a condition that such co-accused “makes a full and true disclosure of the whole of the circumstances within his knowledge relative to the offence and to every other person concerned, whether as principal or abettor, in the commission”[3] of the offence. Kallu being a suspected accomplice in the crime was tried jointly with the accused Rambihari and Ramswarup. So his testimony stands valid and competent before the law.

8. Further section 30 of Indian Evidence Act 1872 clearly stipulates that evidence given by Kallu is undoubtedly competent to be used against co-accused Rambihari and Ramswarup[4].

9. Moreover, the evidence given by Kallu has been proved by the discovery of the body of the deceased based on information given by Kallu. Therefore, according to section 27[5] of Indian Evidence Act 1872, Kallu’s deposition is proven to be correct and reliable.

10. Only situation in which an evidence given by a witness like Kallu can discarded is mentioned in section 308 of Criminal Procedure Code 1973, i.e. when Kallu violates any of the conditions imposed by court in exchange of the pardon given to him. And in that case Kallu can also be turned again to be accused and put on trial. And any reasonable man would not put himself in such a jeopardy as the common sense says.

11. Considering the competency of Kallu as a witness, section 133 of Indian Evidence Act 1872 provides that “an accomplice shall be a competent witness against an accused person, and a conviction is not illegal merely because it proceeds upon the uncorroborated testimony of an accomplice.”

12. Section 114 of Indian Evidence Act 1872 provides that “the court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case”. In this peculiar case, where no other evidence is possible to be brought in, and where there is a substantially reliable evidence given by the friend of the deceased, who has witnessed the crime, it will be reasonable and prudent for the court to believe on the evidence of Kallu, which at no stage had been successfully proven doubtful by the defense, whotsoever.

Binding Case Laws supporting the reliability of the evidence

13. It has been enunciated by the honorable Supreme Court in the case of Haroom Haji v. State of Maharashtra[6] that “every detail of the story of the accomplice need not be confirmed by independent evidence”.

14. Also, in the case of Bhuboni Sabu v. Emperor[7], the Privy council has propounded that “on reading section 133 with illustration (b) to section 114, it is not illegal to act upon the uncorroborated evidence of an accomplice”.

15. In a very similar case of Sanjay v. The state[8], an appeal was filed for challenging conviction of appellant under Sections 302, 392 and 397. The conviction was challenged on ground that evidences on which it based were unreliable and inadmissible. The main evidence was disclosure statement of accused and recovery of weapon of offence, blood stained clothes and stolen property on basis of the statement. Statement was contended as inadmissible evidence under Sections 25 and 26 of Indian Evidence Act 1872. As per section 27 of the same Act, where some facts or evidences were discovered on basis of statement of accused, the statement was held to be admissible as evidence and the conviction was upheld.

16. In King v. Baskervilli[9], Lord Reading, CJ, laid the test “that the corroboration need not be direct evidence that the accused committed the crime. It is merely circumstantial evidence of his connection with the crime. The nature of the corroboration will depend and vary according to the particular circumstances of each case. What is required is some additional evidence rendering it probable that the story of the accomplice is true and that it is reasonably safe to act upon”. In the herein before the honorable High Court, the statement of the accomplice has already been proved by the finding of the dead body and murder weapons along with the blood stained clothes. And after the establishment of fact that mother of Ghuram herself sent Kallu with Ghuram in the forests lends further substantial creditworthiness to the co-accused Kallu, who was friend of Ghuram.

17. This Court in Rameshwar v. The State of Rajasthan[10],held that “it is not necessary that there should be independent confirmation of every material circumstance in the sense that the independent evidence of the case, apart from the testimony of the complainant or its accomplice should in itself be sufficient to sustain conviction. All that is necessary is that there should be independent evidence which will make it reasonably safe to believe that the witness's story that the accused was the one that committed the offence could be acceptable. The corroboration need not be direct evidence that the accused committed the crime. It is sufficient if it is merely circumstantial evidence of his connection with the crime.”

[1] S.307 read with s.306, Criminal Procedure Code, 1973

[2] S.308 of Criminal Procedure Code 1973 talks about repercussions, in case a witness under pardon, deposes the evidence falsely before the court.

[3] S. 306, Criminal Procedure Code, 1973.

[4] S.30, Indian Evidence Act 1872 reads as – “When more persons than one are being tried jointly for the same offence, and a confession made by one of such persons affecting himself and some other of such persons is proved, the Court may take into consideration such confession as against such other person as well as against the person who makes such confession.
Explanation - "Offence" as used in this Section, includes the abutment of, r attempt to commit, the offence.”

[5] S.27, Indian Evidence Act 1872, reads as – “Provided that, when any fact is deposed to as discovered in consequence of information received from a person accused of any offence, in the custody of a police officer, so much of such information, whether it amounts to a confession or not, as relates distinctly to the fact thereby discovered, may be proved.”

[6] Haroom Haji v. State of Maharashtra, AIR 1968 SC 832.

[7] Bhuboni Sabu v. Emperor, AIR 1949 PC 257.

[8] Sanjay v. State, AIR 2001 SC 979.

[9] King v. Baskervilli [1916] 2 K.B. 658

[10] Rameshwar v. The State of Rajasthan, MANU/SC/0036/1951: AIR 1952 SC 54.

Fiest v. Rural Telecom

2011-03-16T04:52:00.004+05:30

STATEMENT OF FACTS

Factual Background:
Respondent, Rural Telephone Service Company, is a certified public utility providing telephone service to several communities in Kansas. Pursuant to state regulation, Rural publishes a typical telephone directory, consisting of white pages and yellow pages. It obtains data for the directory from subscribers, who must provide their names and addresses to obtain telephone service.
Appellant, Feist Publications, is a publishing company that specialized in compiling telephone directories from larger geographic areas than Rural from other areas of Kansas. They had licensed the directory of 11 other local directories, with Rural being the only hold-out in the region.

Rural had refused to license its white pages listings to Feist. So Feist extracted the listings it needed from Rural's directory without Rural's consent. Even though Feist altered many of Rural's listings, several were identical to listings in Rural's white pages.

Rural brought copyright infringement action against Feist for publisher's use of listings in utility's local white pages.

Procedural Background:

The District Court held that the white pages were copyrightable. Thus Feist was held liable for copyright infringement.

The High Court upheld the decision of the District Court.

The present appeal by the appellant before the honorable Supreme Court call into question the correctness of the said order passed by the High Court.

ISSUES RAISED

Whether Feist Publications is liable for Copyright infringement?

SUMMARY OF ARGUMENTS

The telephone numbers are not facts of discovery, but facts which are created in the course of business of the respondent, thus are purely originated from the respondent. So they qualify for copyright protection.

The copying of substantial portion from the respondent’s compilation results in severe commercial loss to the respondent, thus invoking unfair competition by free riding by the appellant.

Facts individually in a compilation though are not protectable but the compilation as a whole definitely is, so appellant’s act amount to copyright infringement.

Respondent had the implied consent of its customers to publish their names, addresses along with phone numbers in the area specific directory. Appellants publishing the same in a much wider geographical area amounts to violation of right to privacy of respondent’s customers, and thus exposes the respondent to and indirect liability.

ARGUMENTS ADVANCED

I. Whether Feist Publications is liable for Copyright infringement?

Whether white pages are copyrightable?

Respondent is the only telephone service provider in the specific geographical region. According to the course of procedure to obtain a telephone connection a prospective customer fills up the required information to obtain the connection, viz name, address, etc. This way respondent acquires the information of its customers. Inter alia, respondent under obligation from the government publishes a directory containing the information of all telephone subscribers with their names, address and telephone numbers. For funding to support the process, respondent solicits yellow page advertising, and thus distributes the copies of the directory to the customers free of cost.

The telephone numbers in the directory are updated along with addresses each year to keep it updated as of date. The process in publishing is not just arranging the list of subscribers in an alphabetical order, but it also entails a continuous updation of data therein and rectification and modification of previous listings. And onto that to make it convenient for the customers the respondent approaches various marketers for yellow page advertising.

On every step of the process, serious skill, judgment and industry is involved, which the respondent puts in meticulously. So according to the sweat of the brow doctrine, respondent claims copyright protection in the telephone directory so published.

The notion that, facts are not copyrightable only applies to the pre-existing facts of discovery. The facts in the white pages of a telephone directory are subject to regular generation and modification with time. Telephone numbers listed in the directory are not pre-existent facts of discovery. Telephone numbers are allotted by the respondent to its customers, and are subject to changes and modifications with time. So respondent has to keep updating the database throughout the year to keep the database updated. Thus, there lies no doubt that the data listed in telephone directory originates from the respondent alone, and is not pre-existing fact of discovery.

The data in white pages, specially the phone numbers is copyrightable as a compilation. “It is clear that one who compiles a directory of factual matter may claim a copyright therein and thus prevent others from copying the arrangement of facts as gathered by the compiler.”

If copyright doesn’t subsists in a telephone directory, then so it should be in the data collected and sold by statistics providing organization, for e.g. the census and indices prepared by the government, or data collection by marketing research companies, which corporations buy at hefty prices from such organizations. But the census, indices and marketing research data enjoy copyright protection. Similarly, telephone directories ought to have copyright protection. Otherwise there will be no incentive left for a telephone service provider to compile and publish a telephone directory.

Whether appellants act amounts to copyright infringement?

It will be unjust to trivialize all this process by saying that the respondent just arranges the list alphabetically and publishes. Because it is not the arranging part in which all efforts seem visible, but it’s the compilation which is the crux of commercial value which a telephone directory carries commercial value for.

Though copying of not substantial part of such directory may be not protected, however, if quite substantial part of such directory is copied, to produce another such competing directory, it amounts to copyright infringement. “Those who appropriate substantial portions of copyrighted telephone directories, word lists, or supply catalogs are no less infringers than those who take from a novel, play, or poem. Each individual fact contained in the compilation enters the public domain as if it had been published alone, [FN56] but the work as a whole is viewed quite differently."

The appellant just copies the core substantial part of the directory to introduce a copy to be marketed of their own. And that too by barging in into the respondent’s sponsors for the same. This act of appellant pure is an epitome of free riding on all hard work and labor done by respondent. Making it more cumbersome for the respondent to comply with the governmental obligations of publishing an updated telephone directory every year.

Also, the U.S. code says that, once a copyright holder establishes with reasonable probability the existence of a causal connection between the infringement and a loss of revenue, burden properly shifts to infringer to show that damage would have occurred had there been no taking of copyrighted expression.

The creativity or effort that engages the machinery of copyright, the effort that elicits judicial concern with unjust enrichment and disincentive, lies not in the arranging, but rather in the compiling. “The copyright protection merely prevents his taking the ultimate data while avoiding the labor and expense involved in compiling them." “The second historian or second directory publisher cannot bodily appropriate the research of his predecessor.”

Mere contention is, as discussed in a famous article by Rober C. Denicola,

“If I purchase Corbin on Contracts, I will not necessarily lose interest in obtaining Williston on Contracts, although my financial status may well dictate a choice. On the other hand, I would have no interest whatever in purchasing a directory of law teachers from two separate publishers. The appropriate scope of the fair use privilege may thus be relatively narrow in the context of pure compilations. This notion may provide some small justification for the distinction drawn between treatises and compilations under traditional copyright theory.”

Thus, facts as such in the white pages of a telephone directory, ought to be copyrighted to protect the incentive for the publishers. And to prevent free riders to graze over the industry done by others.

Violation of Right to Privacy of customers of respondent.

Respondent had an implied assent to publication of the customers addresses and telephone numbers along with their names, to be found in the area specific telephone directory, by virtue of the statutory obligation that the legislators put on the respondent. Mere existence of obligation sets it obvious to the customers of respondent that their names will be listed in the directory published by the respondent.

However, it is not the same for the appellants. Appellant did publish their directory in a much wider geographical region, with much wider target customer segment. What if respondent’s customers put an objection against their addresses and telephone numbers being published to so big media? What if they start getting unsolicited calls by misuse of the directory by the marketers and other such people? Respondent can justify the publishing alleging the statutory requirement. But the act of the appellant, who just copies all information from respondent’s telephone directory, is totally irresponsible and unjust to subscribers of respondent’s customers. And it may expose respondent to unwanted liability claims.

[1]. See 1 M. Nimmer, Nimmer on Copyright § 1.01[B][2][b] (1978)

[2]. Kane v. Pennsylvania Broadcasting Co., 73 F. Supp. 307 (D. Pa. 1947); see, e.g., Schroeder v. William Morrow & Co., 566 F.2d 3 (7th Cir. 1977); Southwestern Bell Tel. Co. v. Nationwide Independent Directory Serv., Inc., 371 F. Supp. 900 (W.D. Ark. 1974).

[3]. 17 U.S.C.A. § 504(b).

[4] International News Serv. v. Associated Press, 248 U.S. 215, 257 n.2 (1918) (Brandeis, J., dissenting). See Comment, Copyrighted Compilations of Public Domain Facts in a Directory: The Criterion of Infringement, 71 Nw. U.L. Rev. 833 (1977).

[5] Huie v. NBC, 184 F. Supp. at 200

[6]Copyright in Collections of Facts: A Theory for the Protection of Nonfiction Literary Works, 81 Colum.L.Rev. 516, 525 (1981)

Anokh Singh v Punjab State Election Commission (2008)

2011-03-16T04:48:00.002+05:30

ARGUMENTS ADVANCED

I. Whether the office of a Lambardar would be an ‘office of profit’ so as to disqualify the incumbent of such an office to seek election as Panch of the Gram Panchayat.

1. It is respectfully submitted before this honorable court that in recent judgment of December 2010 by High Court of Punjab, it was held that office of a Lambardar is office of profit as under clause (1), art. 243F, read with section 2(a) of the Punjab State Legislature (Prevention of disqualifications) Act, 1952, so as to disqualify such lambardar to contest the Gram Sabha Elections.

2.      The counsel here humbly argues that the office of Lambardar can not be held to be an office of profit as there is no pecuniary profit attached to it.
3.      The appellant receives merely Rs. 900/- per month as honorarium attached with the lambardar.
4.      This sum is very less so as to lead to pecuniary profit to the incumbent. The sum is paid as compensation for effectively carrying out various duties and responsibilities attached with the bearer of the office of a lambaradar, as described in rules 20 and 21 of the Punjab Land Revenue rules. The rules read as

Rule 20 - In addition to the duties imposed upon headman by law for any purpose, a headman shall-

(i) collect by due date all land-revenue and all sums recoverable as land revenue from the estate, or Sub-Division of an estate in which he holds office, and pay the same personally or by revenue money order or by remittance of currency notes through the post at the place and time appointed in that behalf to the Revenue Officer or assignee empowered by Government to receive it.

Selected lambaradars, approved by the Collector, may pay land revenue and all sums recoverable as land revenue from the estate or sub division of an estate in which they hold office, by cheques on the Imperial Bank of India, provided that there is a branch of the Imperial Bank at the headquarters of the district in which the said estate is include;

(ii) collect the rents and other income of the common land and account for them to the persons entitled thereto;

(iii) acknowledge every payment received by him in the books of the land owners and tenants;

(iv) defray joint expenses of the estate and render account thereof as may be duly required of him;

(v) report to the tehsildar the death of any assignee of land revenue or Government pensioner residing in the estate, or the marriage or re-marriage of a female drawing a family pension and residing in the estate, or the absence of any such person for more than a year;

(vi) report to the tehsildar all encroachments on roads including village roads or on Government waste lands and injuries to or appropriations of, nazual property situated within the boundaries of the estate;

(vii) report any injury to Government buildings made over to his charge;

(viii) carry out to the best of his ability, any orders that he may receive from the Collector requiring him to furnish information, or to assist in providing or payment supplies or means of transport for troops or for officers of Government on duty;

(ix) assist in such manner as the Collector may from time to time direct at all crop inspections, recording or mutations surveys preparation of record of rights, or other revenue business carried on within the limits of the estate;

(x) attend the summons of all authorities having jurisdiction in the estate, assist all officers of the Government in the execution of their public duties, supply to the best of his ability, any local information which those officers may require, and generally act for the land owners, tenants and residents of the estate or sub division of the estate in which he holds office in their relations with the Government;

(xi) report to the patwari any outbreak of disease among animals;

(xii) report to the patwari the deaths of any right holders in their estates;

(xiii) report any breach or cut in a Government irrigation canal or channel to the nearest canal officer, (ziledar) or canal patwari;

(xiv) under the general or special directions of the collector, to assist by the use of his personal influence and otherwise all officers of Government and other persons, duly authorised by the Collector in the collection and enrolment of recruits for military service whether combatant or non-combatant;

(xv) render all possible assistance to the village postman while passing the night in the village, in safeguarding the cash and other valuables that he carries.

5. The Appellant used to get, 10% of the land revenue assessed on the estate or the portion of the estate in which he holds office, as officer’s cess. But at the time of abrogation of the land revenue this remuneration was replaced by Rs 500 per month in October 2006. Currently the appellant receives Rs. 900 per month as honorarium.

6. The counsel here contends that in the office which the appellant bears is just a heritage office and is not functionary as such make a conflict of interest, if any, with the duties and responsibilities of an elected panch.

7. Onto that, considering the big list of responsibilities as enlisted in rule 20 reproduced above, the honorarium of Rs 900 per month seems totally compensatory to meet out pocket expenses incurred in performance of those duties. And there is hardly any chance that this compensation can result in profit as such to the appellant.

8. Honorable High Court in its decision relied on the decision of this court in Som Lal v. Vijay Laxmi and Ors[1], and considering Rs. 900 as honorarium attached with the office bearer, deemed the office of a lambardar as office of profit. The case propounds that whoever is a bearer of office of profit under the state government is disqualified to contest the panchayat elections. Nevertheless, the contention is that the appellant receives only Rs. 900 per month honorarium, and no other allowance howsoever for discharge of his duties. Thus concluding that Rs 900 will lead to any pecuniary profit after discharge of plethora of duties and responsibilities under Rule 20 of Punjab Land Revenue Act, is preposterous. Thus in substance the amount is basically compensatory allowance and not salary. The basic idea behind such honorarium is that the holder of the office does not have to bear the expenses in the discharge of duties, out of his own pocket.

9. The counsel further requests the court to see the issue as a matter of substance rather than form. Though the sum of Rs. 900 paid to the lambardar is termed honorarium, it is actually compensatory in nature as contended above.

10. It has already been decided by the honorable Supreme Court that the post of a lambardar is not post of government servant[2]. i.e. the lambardar does not hold a civil post within the meaning of art. 309 of Constitution of India. Consequently lambardar is not recipient of regular salary or remuneration under the state government.

11. Only fact that lambardars can be appointed and removed by the government, can not be a conclusive ground in deciding that the lambardar holds the office of profit. Reason being that there is no remuneration or salary profiting in nature paid to the bearer of the office.

12. Further, honorable high court has relied on the test laid in the case Shivamurthy Swami v Veerabhadrappa Veerappa[3] for determining whether a lambardar holds an office of profit. The basic postulates laid down in the test are:

a. Whether the government makes the appointment;

b. Whether the Government has the right to remove or dismiss the holder;

c. Whether the Government pays the remuneration;

d. What are the functions of the holder? Does he perform them for the Government; and

e. Does the Government exercise any control over the performance of those functions.

13. It is contended that the office of a lambardar does not accede to the postulates (c) & (d) in the above test in substance, to be held as office of profit. Government does not pay any remumneration as such, as argued above. And secondly, there is no important function is left to be performed by a lambardar, after the abrogation of land revenue collection by a lambardar.

14. It has already been held by honorable Supreme Court that the payment to a office bearer, which is compensatory in nature can not be said to lead to any pecuniary gain, thus such office can not to be considered as office of profit.[4] Because “the word ‘profit’ connotes the idea of pecuniary gain. If there is really a gain, its quantum or amount of money receivable by a person in connection with the office he holds may be material in deciding whether the office really carries any profit.”[5] “The question has to be looked at in realisitic way. Mere because part of the payment made is called honorarium and part of payment daily allowance, we can not come to the conclusion that the daily allowance is sufficient to meet his daily expenses and the honorarium is a source of profit.”[6] “The law regarding the question whether a person holds an office of profit should be interpreted reasonably having regard to the circumstances of the case and the times with which one is concerned, as also the class of person whose case we are dealing with and not divorced from reality.”[7] The honorable court has reiterated and emphasized the ration in the case Shibu Soren v. Dayanand Sahay[8].

15. Similar is the case in which honorable Supreme Court held that the office bearer of Chairman, Panchayat Samiti, is not office of profit[9]. In that case the appellants failed to prove that the Chairman received any amount so as to lead to profit. The court established that the burden of proof lies on the person who questions such remuneration and claims it to leading in pecuniary gain. And it is trite that mere drawal of the daily allowance and travelling allowance could not make any office, ‘office of profit’[10].

16. Thus the counsel here alleges there is gross lack of any ratio or evidence coming from the respondent, based on which the lambardar is claimed to be holding an office of profit.

[1] AIR 2008 SC 2088

[2] Mahavir Singh v. Khiali ram & Ors., (2009) 3 SCC 439.

[3] (1971) 3 SCC 870

[4] Gatti Ravanna, son of Gatti Subanna, Gubbi Taluk, Mysore State v. G.S. Kaggeerappa, Merchant, Gubbi, AIR 1954 SC 653.

[5] Ibid;

[6] Shivamurthy Swami Inamdar v. Agadi Sanganna Andanaappa, (1971) 3 SCC 870;

[7] Ibid;

[8] (2001) 7 SCC 425.

[9] S. Umrao Singh v. Darbara Singh & Ors., 1969 (1) SCR 421.

[10] Supra foot note no. 6.

Consumer Education & Research Society v Union of India (2009)

2011-03-16T04:45:00.000+05:30

Whether the Amendment Act, which has retrospective effect, is constitutionally valid or not?

1. Here in challenge is the validity of the Parliament (Prevention of Disqualification) Amendment Act, 2006 (Hereinafter referred as ‘Amendment Act’), which amends the Parliament (Prevention of Disqualification) Act, 1959 (hereinafter referred as Principal Act). The amendment act stipulates a list of offices to be exempted to cause disqualification of the holders of that office for being chosen as, or for being the Members of Parliament (MP) with retrospective nature.

CONSTITUIONALITY

2. It is established that the term office of profit is not defined in the constitution. But the ratio for disqualifying holders of such disqualifying offices is well established, which is to avoid any conflict of interests due to holding an office under the executive function of state of central government vis a vis representing people in Parliament or State Legislative assembly, thus ensuring smooth discharge of duties by the incumbent MP or Member of Legislative Assembly (MLA)[1].

3. Section 3(k) of the Amendment Act refers to a list of offices considered not to cause holders of post in those offices disqualification, as per Art 102 (1)(a) of the Constitution of India (CoI). The parliament in coming up with such list has done no inquiry or research or any endeavor to determine whether holders of such office can have any conflict of interest in discharging the duties and responsibilities of being a MP or MLA. The fact that this list also includes the offices which are already declared office of profit by honorable Supreme Court (SC) after considering material facts and circumstances attached to such office. One such entry in the list is ‘The Uttar Pradesh Film Development Council’. This office has been clearly declared office of profit by SC in the case Jaya Bachan v. Union of India in 2006[2].

4. It should be noted that the disqualification holders of post in offices of statutory of non- statutory body is already taken care by section 3(i)[3] of the principal act. Incorporating explicitly violative exceptions to the section 3, in spite of no apparent reason is sheer abuse of the power of parliament to legislate in such matters.

5. Incorporating such list of offices without any scrutiny or inquiry to determine applicability of basic principle of the scheme laid down in art. 103(1)(a), i.e. ‘office of profit’, is sheer violation of the constitution. Such arbitrary list is also hit by art. 14 of the CoI which talks about equality before law[4]. The insertion of such list being totally arbitrary and without any reasonable grounds and in total opposition to the basic object of the act, which is to determine the qualification or disqualification of the MPs and MLAs, in order to ensure effective discharge of duties and responsibilities by them, and in conclusion ensuring a healthy and scrupulous representation of people, in furtherance of effective functioning of the democracy. According to the counsel it would not be an exaggeration to say that the amendment act seems to appear with sole objective of benefit of MPs as person, rather than MPs as the representatives of the polity of India[5].

6. The basic motive of incorporation of such arbitrary list as in section 3(k) of the amendment act, which contains offices of profit - by mere name of which offices, it can be understood that holder of such office will face conflict of interest being MP or MLA - seems to be defeat the scheme laid down in constitution and ensure the remaining of power of such offices along with the representation of the constituencies in the same hands, so as to benefit such MP, jeopardizing the effective functioning of democracy for no good reasons. The apprehensions of the SC in the case of Srimati Kanta Kathuria, that the power of the parliament to make laws to regulate its own issues is not a healthy practice and may be abused[6], is seeming to come true through this colorable legislation which enable the disqualifying members (as per the constitution) to continue enjoy the positions in Parliament and State Legislative Assemblies (SLA). Such whole-sale exemption of offices which are no doubt ‘offices of profit’ renders the art 102(1)(a) redundant.

7. Similar is the footing of the sub-clause (l) and (m) of section 3 as per the amendment act. These sub-clauses in general hold eligible the holders of posts in any society registered and any trust. What is the ground for such whole-sale exemption granted to the disqualifying office of profits is the question that the counsel puts for the respondents.

8. It is no doubt that parliament is empowered to make laws on such matters. But making arbitrary and constitutionally invalid laws is for sure not within the power of parliament, hailing art. 14 in the Chapter 3 of Fundamental Rights in the constitution[7].

9. Art. 104 read with art. 102, 102 and 103 seperately of CoI establishes that the basic scheme behind art. 101 to art. 104 of CoI is to prevent and deter the disqualified members from contesting for and being MPs as long as they are disqualified[8]. Thus the said act explicitly violates the said art. of the constitution and is thus unconstitutional.

Whether the seat of a member becomes vacant immediately on him incurring a disqualification or after adjudication.

VACANCY OF THE SEAT

10. It is of no dispute that being disqualified is not a onetime occurrence but continuing phenomena. As long as a candidate renders the criteria of disqualification application to him, he is disqualified. Whatsoever, if a person gets elected in spite of different hurdles laid down in the election procedure to avoid disqualified nominants being elected, it does not removes the disqualification so incurred as per the art. 102 of CoI. So it is frivolous to say that a person gets disqualified only after the declaration by the president as per art. 103 of CoI. The President’s declaration is mere act ascertainment of the confusion regarding the disqualification whether applicable or not[9].

11. Also, art. 102(1)(a) of CoI says that the holders of ‘office of profit’ shall be disqualified for being ‘chosen as’, and for ‘being’, a member of either house of Parliament. Thus art. 102 is applicable - when the candidate is seeking election, by virtue of the words “chosen as”, and also at the time and after the candidate gets elected as MP, by virtue of the words “for being”- to render him disqualified continuously inspite of him being elected in between. So it covers the disqualification incurred by the candidate in both circumstances, i.e. when he is seeking election and after he gets elected. So the words ‘becomes subject to’ and ‘has become subject to’ means that as soon as the disqualification is incurred (as by accepting office of profit), irrespective whether such disqualification was incurred before or after getting elected. And when the said art. is read with art 101(3)(a), it explicitly renders the seat of such MP vacant right from the time when he becomes subject to disqualification under art. 102[10]. Also it should be noticed that there is not explicit or implicit provision in CoI which renders the disqualification of a candidate null on his getting elected as MP.

However, even the art. 103 of CoI starts with words – ‘“if any question arises” as to whether a member of Parliament has become subject to disqualification… ’. So it is explicit that the president’s declaration is required only in cases where the situation is ambiguous to ascertain whether disqualification is posed on MP. The words – “referred for the” decision of the President… - clearly suggests that the matter is to be referred to the President to bring certainty in the ambiguity. Would the intention of the constitution had been to bestow exclusive authority to the president in all matters of disqualification, then the language of the section would have been different. Thus the declaration by the President pertaining to the disqualifications merely decides about the question of disqualification, and not effects in removal of such member, because removal (making seat vacant) of the candidate is already taken care by art. 101(3) of CoI, which is ‘Vacation of Seats’, and it is notable there is no provision to include authority of president to decide on ‘Vacation of Seats’. President is solicited to make decision under art. 103, which is - “Decisions on ‘Questions as to disqualifications’ of members”.

[1] Ashok Kumar Bhattacharya v. Ajoy Biswas, AIR 1985 SC 211, 215; Also, Satrucharla Chandrasekhar Raju v. Vyricherla Pradeep Kumar Dev., AIR 1992 SC 1959; See also: The Introduction to the Bhargava Committee Report on Office of Profit, dated 22.10.1955.

[2] Jaya Bachan v. Union of India, (2006) 5 SCC 266.

[3] Section 3(i) of Parliament (Prevention of Disqualification) Act, 1959, which talks about the offices which do not pose any disqualification on holders as office of profit, reads as – “The office of chairman, director or member of any statutory or non-statutory body other than any such body as is referred to in clause (h), if the holder of such office is not entitled to any remuneration other than compensatory allowance, but excluding (i) the office of chairman of any statutory or non-statutory body specified in Part I of the Schedule, (ii) the office of chairman or secretary of any statutory or non-statutory body specified in Part II of the Schedule;”

[4] Jagannath v. State of Uttar Pradesh, AIR 1961 SC 1245; Mohd. Shaheb Mahboob v. Dy. Custodian, AIR 1961 SC 1657; Gauri Shankar v. Union of India, AIR 1995 SC 55; Laxmi Khandsari v. State of Uttar Pradesh, AIR 1981 SC 873.

[5] “I want, however, to add certain other things, which are, as we notice, far more likely to be sources of temptation to sacrifice public interest to private advantage, than more holding of an office of profit.”, Prof. K.T. Shah, Constitutional Assembly Debates, Vol. 8.

[6] Kathuria v. Manak Chand Surana, (1969) 3 SCC 268.

[7] Laxmi Khandsari v. State of Uttar Pradesh, AIR 1981 SC 873.

[8] “The other important thing to be borne in mind is that the matter should be decided as early as possible, because, under article 168, there is a penalty of Rs. 500 a day for a member who is under a disqualification and who sits or takes part in the proceedings, or votes on a particular motion. As soon as the question is raised that a particular member is under a disability, that particular member would naturally like the decision to be given as early as possible.”, Shri B. A. Mandloi, Constitutional Assembly Debates, Vol. 8.

[9] Election Commission, India v. Saka Venkata Subba Rao & Union of India, 1953 SCR 1144; Brundaban Nayak v. Election Commission of India (1965) 3 SCR 53; P.V. Narasimha Rao v. State (CBI/SPE), (1998) 4 SCC 626; See also: Constitutional Assembly Debates, Vol. 8.

[10] “a person "shall be disqualified" under certain contigencies. If those contingencies really happen the disqualification is automatic and absolutely complete. The text says; if a member becomes "subject to any of the disqualifications." I say, "if he is disqualified under sub-clause (1)" of the next succeeding article, the expression 'subject to any disqualification' implies that the event is likely to happen and therefore I suggest 'is disqualified' which indicates a completed fact. The real clause which deals with disqualification is very absolute and deals with this matter as a completed fact.”, Mr. Naziruddin Ahmad, Constitutional Assembly Debate, Vol. 8; See also: P.V. Narasimha Rao v. State (CBI/SPE), (1998) 4 SCC 626.

Product Liability

2011-03-16T04:29:00.003+05:30

1. Introduction

Product liability concepts are continuously evolving with changing needs of the society. With the advent of market driven society the relationship between the manufacturers and the consumers is continuously changing. There once stood a time when alone the buyers were held responsible to bear the loss arising out of them buying defective products. But now the situation seems radically changed with pro-competitive policies of states, which had given immense power in hands of the consumers and now manufacturers also have a great role to play while the manufacturers delivering products in the market. And to ensure all these, the role of the Law of Torts is also becoming more and more important.

This report deals with the same evolution of laws pertaining to product liability. The researcher has tried to capture the history and subsequent progression of the laws with respect to the dynamics of the relationship between the manufacturers and the consumers.

Further the report will discuss a few landmark cases like Donoghue v Stevenson, which changed the perception of the term product liability. And later the researcher will try to discuss the statutes which govern the realm of Product Liability in India, with its relation to tort.

2. Product Liability – Definition

According to Black’s Law Dictionary[1] the term product liability is defined as: “A manufacturer’s or seller’s tort liability for any damages or injuries suffered by a buyer, user or bystander as a result of a defective product”

In very simple terms, product liability can be defined as the liability arising out of loss or injury caused by defective products sold by manufacturers.[2] Thus the term product liability generally refers to the laws which protect consumers from loss arising due to defective products, and which shifts the responsibility for the loss on the manufacturers, to deliver safe and ‘appropriate for use’ products in the market.

3. Evolution of Product Liability Laws

3.1 Caveat Emptor

Caveat emptor is a Latin term which stands for ‘let the buyer beware’. The term is defined as: “the principle that a person who buys something is responsible for finding faults in the thing they buy”[3]. This principle was prevalent in common law at old times. So the buyer alone had the onus to check the materials that he is buying carefully, to ensure that he is getting what he has paid for, or either he has to make concomitant contractual relations while buying with the seller, to ensure that he stands safe and unaffected if any problem arises in future related to the goods he bought. And if any buyer fails to do so, he himself should bear the loss and injury occurring to him, if any, directly or indirectly through those goods.[4]

“The law of products liability is that body of common and statutory law permitting money reparation for substandard conduct of others resulting in product-related injury to the injured party’s person or property. Resistance to the description of products liability as a doctrine having receded, there is today a guiding tenet in the law of product-related injury that is the distillate of seventy years of decisional law. The birth of the doctrine can be dated at 1916, the publication of the immensely influential decision in MacPherson v. Buick Motor Co.[5], in which the New York Court of Appeals held that the manufacturer of any product capable of serious harm if incautiously made owed a duty of care in the design, inspection, and fabrication of the products, a duty owed not only to the immediate purchase but to all persons who might foreseeably come into contact with the product. Following MacPherson, the doctrine is formed by decision of the ensuing decades is that a buyer, user, consumer or bystander in proximity to an unreasonably dangerous product, and who is injured in person or in property by its dangerous propensities, may recover in damages from the manufacturer or intermediate seller.”[6]

The common law system used to address the cases of loss due to faulty products through the principle of caveat emptor. In 1893 the parliament in US introduced Sale of Goods Act, which gave a bit of protection to the purchasers.

The biggest turning point to revamp the laws relating to product liability was the case Donoghue v Stevenson.[7] Before this case was decided, there were perplexities about whether the seller did have any duty towards the buyer, if there is no explicit contractual relationship between them already agreed to, with exception that the goods sold are not in classification of dangerous goods.[8]Even there was no good classification of dangerous goods as a genus itself. Scrutton L.J. in case Hodge v. Anglo-American Oil Co acknowledged that he was unable to differentiate “between a thing dangerous in itself, as poison, and a thing not dangerous as a class, but by negligent construction dangerous as a particular thing. The latter, if anything , seems to me the more dangerous of the two; it is a wolf in sheep’s clothing instead of an obvious wolf.”[9] But after Donoghue v Stevenson it was established, by a majority of three to two, that in redundance of whatever extraneous arrangement it may be, there lies a duty that the manufacturer should fulfill for his products. According to the narrow rule established in Donoghue v Stevenson case:

“A manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination and with the knowledge that the absence of reasonable care in the preparation or putting up of the products will result in an injury to the consumer’s life or property, owes a duty to result in an injury to the consumer’s life or property, owes a duty to the consumer to take that reasonable care.”[10]

The classification of dangerous goods which was used to decide cases of product liability was abolished by 1950s.

All the laws in tort for product liability were based on the principle of negligence, until the concept of strict liability was brought in as statute by the Consumer Protection Act. As per the current scenario, there lies no liability according to the laws of tort on manufacturer, until the negligence is proved on the part of the party, apart from specific statutes, which impose strict liability as such.

Thus, the principle of caveat emptor evolved into the Caveat Venditor, i.e. ‘Let the seller beware’.

4. Position in India

In India, there are various laws that address the rights of a buyer. Product liability in general is covered by various laws, such as:

1. The Consumer Protection Act, 1986 (herein after referred as CPA)

2. The Sales of Goods Act, 1930

3. The law of Torts

4. The Monopolies and Restrictive Trade Practices Act, 1969

5. Special statues pertaining to specific goods, for e.g.

a. Food Safety Standards Act 2006

b. Pharmacy Act 1948, etc.

All these acts and statutes address the concerns of a buyer to some extents, except the CPA, the main object of which is itself the Product Liability. We will deal here in this dissertation with Consumer Protection Act in detail.

5. Consumer Protection Act, 1986

Consumer protection act has certain aims and objectives. This statute was a result of widespread consumer protection movement across the globe. In a report of Secretary General on Consumer Protection, dated 27^th may 1983, the UNESCo (United Nations Economic & Social Council) recommended that the world governments should develop, strengthen and implement a coherent consumer protection policy taking into consideration the guidelines set out therein.

In India CPA was ratified by the president on 24^th Dec 1986, but it came into force on 15^th April, 1987.

CPA has two main objectives. First is to protect the rights of the consumer. These rights are:

a) The right to be protected against marketing of goods which are hazardous to life and property

b) The right to be informed about the quality, quantity, potency, purity standard and price of goods to protect the consumer against unfair trade practices

c) The right to have, wherever possible, access to goods at competitive prices

d) The right to be heard and to be assured that consumers interests will receive due consideration at appropriate forums

e) The right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers

f) Right to consumer education.

Second, to facilitate the consumers in getting quicker or speedy redressal of their grievances by establishing special courts and tribunals, instead of filing a suit in civil court, which takes much longer time.

This act also defines various terms involved such as consumer, complainant, complaint etc.

5.1 Consumer – Defined

Section 2(1)(d) of CPA has defined the term consumer in two parts, first defines consumers of goods, and the second part deals with the consumers of services.

The section runs as

(d) “consumer” means any person who –

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use if made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary or such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person;

Explanation:- For the purposes of sub-clause (i), “commercial purpose” does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment;

Thus, the consumer means any person who buys any goods for consideration, and also includes persons other than buyers who use the goods with the consent of the buyer, as evident in the Donoghue v. Stevenson case.

5.2 Rights of a Consumer

There are various rights of a consumer which are promoted and protected under CPA as mentioned before, let us discuss it in some detail.

5.2.1 The Right of Protection Against Hazardous Goods

Here the term hazardous goods includes, for e.g. weak cement, narcotic drugs, adulterated foods, etc. All these things are dangerous to persons as well as property. There stand various laws established by government which prevent the marketing of such products but still, if any person gets victim of tort because of any such products he can always approach the CPA forums to get a speedy remedy.

The famous case Donoghue v. Stevenson[11], which we have discussed earlier in this text, also pertains to the hazardous goods. Here the bottle of drinks in which a dead snail was found was also considered to be dangerous good, which clearly portrays the ambit of the term dangerous or hazardous goods, i.e. any goods which can cause danger or hazard to person or property. It was held in this case that a manufacturer sending goods into the market would be liable to the ultimate consumer, if his person or property is injured by the normal use of the goods. In this case, A bought a bottle of ginger wine from the retailer which was produced by manufacturer B, and gave it to his friend C. The bottle allegedly contained the decomposed remains of a snail which were not, and could not be, detected (the bottle being opaque), until most of the bottle had been consumed. C alleged that she was ill due to that ginger wine and sued B. In this case B was held liable.

Similarly a weaver of trousers was held liable when the person who wore the trouser suffered a problem of dermatitis because of the chemical contained in that trouser.[12]

5.2.2 Right of Information

CPA protects every consumer’s right to have information about the quantity, quality, potency, purity, standard and price of goods or services he buys or avails.

This right helps to prevent the consumers cheated by unfair trade practices by the marketers. Unfair trade practices may include; any false warranty or guarantee of performance of the goods or services, publication of advertisements for sale or supply of goods or services at a bargain price, offering of gifts, prizes or other items with the intention of not providing them as offered or creating an impression that something in being offered free of charge when in fact it is not so in reality, etc.

To illustrate, the famous case Consumer Protection Council v. National dairy Development Board[13], in which, the complainant wanted to know that how the dairy board was using the imported palmolein oil but the Board was not furnishing the requisite information because according to it the figures were privileged from disclosure in public interest. It was held that the complainant had the right of information.

Similarly in India Photographic Co. v. H.D. Shourie[14], an importer of films was not able to print prices on films because the nature of his trade did not permit him to open packages. Therefore, he was directed to make a condition of attaching price tags to each item before selling them to his retailers.

Again, when Rs 88 were charged for an article which showed the price Rs 75, the buyer was given a compensation of Rs. 500[15].

Cases of unfair trade practices are also dealt by Monopolies Commissions established under the MRTP Act[16].

5.2.3 Right of Access to Variety of Goods and Services at Competitive Prices

Every consumer should be ensured the right access to variety of goods and services at competitive prices. Section 6(c) of CPA guarantees that. A consumer should be able to access different brands and types of goods and those all should be available at competitive prices so that the consumer stands free to choose. No shopkeeper can force the customer to buy only one type of goods, either by cajolement or by leaving customer out of choice by keeping only particular class of goods. The Consumer Protection Council holds the onus to ensure all this by virtue of section 6(c) of CPA.

5.2.4 Right to be Heard and Receive Due Consideration at Appropriate Forums

Every consumer has the right to be heard and receive due consideration at appropriate Forums. The Central Consumer Protection Council has been charged with the responsibility of ensuring that each consumer dispute is heard properly and of assuring that consumer’s interest will receive due consideration at appropriate forums. That means the National Consumer Protection Council should ensure that any consumer should never be denied to file a case or complaint, and further that complaint is for sure to be given consideration and hearing.

5.2.5 Right Against Unfair or Restrictive Trade Practices, Unscrupulous Exploitation

These days we see various advertisements in newspapers where permanent cure of baldness, for increasing height of a person, lands are sold with fake documents, duplicate products, selling old products in new packaging, medicines, all these come under scrupulous and unfair trade practices. If any consumer gets injured of his right or incurs damage because of such products, its National Consumer Protection Council’s responsibility to protect and get the consumer restituted against such cunning marketers. There are innumerable such cases.

5.2.6 Right to Consumer Education

It means that every consumer has the right to be educated about his rights and remedies available in case of any problem if arises, when he buys a product. So that people can exercise their rights and avail such legal remedies.

Any of the above rights are legal rights of a consumer and thus if violated, constitute to a tort committed.

6. Sale of Goods Act, 1930

Sale of Goods Act, 1930 also provides protection of some sort t buyers of goods, whether consumers or not. Sale of Goods Act enables the buyer of goods to reject the goods, i.e. the contract of sale of goods becomes voidable at the instance of buyer if:

a) Goods do not conform with their description

b) not fit for the use for intended purpose

c) goods are not of merchantable quality

d) the bulk of goods do not agree with the sample provided.

The problem with rights ensured by the Sale of Goods Act is that there are no special courts provided like that in CPA. One has to file a civil suit to bring an action, which takes much longer time. But again, the National Consumer Protection Council has bestowed the consumer protection quasi-judicial authorities with some power of civil courts. So even now cases out of sales of goods act which are of consumer protection in nature can be handled in CPA forums.

One drawback in the Sale of Goods act is that, due to privity of contract principle, no person other than the buyer can sue the seller for any injuries. Only persons party to the sale transaction can be sued. In case Daniels and Daniels v R. White & Sons[17], the person who bought the lemonade could successfully sue the seller of wines when the lemonade turned out to be contaminated and he suffered injuries but his wife who suffered similar injuries after drinking the same bottle of lemonade, could not have a remedy for her injuries, by either the Sale of Goods Act neither by the Contract Act. But such loopholes are now covered effectively by CPA.

7. Conclusion

The first product was done in 1959 when General Motors called back the Cadillacs because of defect in the steering linkage. After that in 1982 McNeil Consumer Health Care, a subsidiary of Johnson & Johnson recalled their product Tylenol. After that there started a trend of product recalls and more than 50 products recalls can be seen in the last decade alone for defective products reached into market. The same effect can be witnessed in the cases of Indian companies, Sun Pharmaceutical and Ranbaxy Laboratories, Maruti Suzuki, etc. In recent times, carmaker Maruti Suzuki too faced a similar situation when it had to recall 100,000 A-Star cars for faulty parts. Same with Toyota Prius cars when they were called back for defective parts in the engine. Also, the Nokia mobiles when they did a product recall for the exploding Nokia Mobile Batteries.

The very effect of product liability laws evolving from the doctrine of caveat emptor to caveat venditor, is seen in the market. The frequently seen product recalls by various pharmaceutical, computer, mobile, automobile manufacturers, etc. is a proof of how the situation has changed and the laws are becoming very consumer friendly in the era of consumerism.

[1] BLACK’S LAW DICTIONARY 712 (8^th ed. 2004).

[2] <http://www.legal-explanations.com/definitions/product-liability.htm>, last accessed on 4^th November 2010.

[3] OXFORD’S ADVANCED LEARNER’S DICTIONARY (7^th ed. 2008).

[4] See, John Murphy, Street on Torts 367 (2003)

[5] 217 N.Y. 382, 111 N.E. 1050 (1916).

[6] M. Stuart Madden, PRODUCTS LIABILITY (2^nd ed. 1988)

[7] Donoghue v. Stevenson, [1932] AC 562, HL.

[8] According to the privity of contract principle, it was deemed in those times, that the manufacturer had the contract with the retailer alone, so the manufacturer owed no duty towards the end consumer.

[9] Hodge v. Anglo-American Oil Co. (1922) 12 L1.L. Rep. 183 at 187.

[10] [1932] A.C. at 599.

[11] Supra note 7.

[12] Grant v Australian Knotting Mills, (1936) AC 85.

[13] (1991) 11 CPJ 617 Guj.

[14] (1991) 11 CPJ 142 Delhi Commission.

[15] Standard Automobile v. Syed Ashrat, (1991) 11 CPJ 626 Ker.

[16] Monopolies and Restrictive Trade Policies Act, 1969

[17] (1938) 4 All ER 258.

G. Sunil Kumar v. A. Renu

2011-03-16T04:20:00.002+05:30

The case is G Sunil Kumar v A Renu, heard by Andhra Pradesh State Consumer Disputes Redressal commission Hyderabad. The case of the complainant is that he joined as a member in the chit for a sum of Rs. 2 Lacs payable in 50 monthly installments of Rs. 4 thousand per month. The chit period was completed by September 2000. The complainant handed over the chit book to the opposite party. The appellant issued a cheque dated 19.10.2000 for the sum of Rs. 2 lacs. But he requested the complainant not to present the cheque as there is no balance in his account. The complainant went to the bank several times and enquired about the balance in the appellant’s account and found that there is no balance. Hence approached the disctrict forum. The district forum found that there is no deficiency in service on part of the opposite party and directed him to pay an amount of Rs 2 lacs with interest at 18% per annum from 19.10.2000 till the date of realization within 1 month from the date of receipt of the copy of th order, and also there is no violation of section 2(1)(g) of consumer protection act 1986, hence the appeal.

The appellant contended that either himself or his father never conducted any chit fund business as contended by the complainant. It is also his contention that he never gave any cheque dated 19.10.2000 for Rs. 2 lacs issued by the appellant in favour of the complainant. The district forum compared the signatures and concluded that they were signed by the same person. Having issued the cheque admitting the liability of the appellant now makes somersault to wriggle out of the liability. The appellant therefore can not walk away of the liability by merely resorting to wholesale denial. Hence no ground to interfere the order of the district forum.

Minor Marghesh K. Parikh v. Dr Mayur H. Mehta

2011-03-16T04:19:00.002+05:30

The case was filed by Marahesh for special leave petition in Supreme Court of India alleging negligence by Dr. Mayur. Marahesh got admitted in the hospital of respondent with mere complaint of loose motions. After some medical tests Dr. Mayur put him on medication and also injected glucose saline through his right shoulder. This did not improve the condition of the Marahesh. He started vomiting and having loose motions frequently. On 3.11.1994, the Dr. Mayur administered glucose saline through the left foot of Marahesh. The same evening, the parents of Marahesh noticed swelling in the toe of his left foot, which was turning black. This was brought to the notice of Dr. Mayur, who stopped the glucose. On the next day, the parents of Marahesh pointed out to Dr. Mayur that blackish discoloration had spread. Thereupon, Marahesh was sent to one Dr. Chudasama, who was known to Dr. Mayur. Dr. Chudasama applied a small cut, removed black colored fluid from the left toe of Marahesh and gave some medicines. In the morning of 5.11.1994, it was noticed that the left leg of Marahesh had become totally black up to the knee. Thereupon, he was taken to Vadodara. Dr. Ashwin Bhamar, who examined Marahesh at Vadodara suspected that he had developed gangrene in his left leg and advised his admission in Bhailal Amin Hospital. Marahesh was operated in that hospital and his left leg was amputated below the knee.

Marahesh claimed compensation of INR 10 lacs alleging that, even though the factum of swelling of the toe and blackening of the leg was brought to the notice of Dr. Mayur, he did not bother to get Marahesh examined through an expert, which could save his leg. It was also pleaded that due to Dr. Mayur's failure to pay requisite attention, Marahesh's left leg had to be amputated below the knee and he will suffer throughout his life.

Dr. Mayur defended stating Marahesh was hospitalized for gastro-enteritis, dehydration acidosis and septicemia shock and mal-nutrition and anemia and seriousness of the case was communicated to his father. According to Dr. Mayur, treatment was given to Marahesh keeping in view the laboratory reports and no glucose was administered after 2.11.1994. Dr. Mayur denied the allegation of negligence and pleaded that he had taken every possible care in treating Marahesh and even got him examined by Dr. Chudasama despite the fact that his hospital was closed on account of holidays.

The State Commission, where the case was first filed, did not accept the version of Dr. Mayur and awarded INR 5 lac as compensation at interest of 9% per annum. Further when the case went to national commission, taken there by the Dr. Mayur, the decision by State Commission was set aside and no negligence was accounted on Dr. Mayur.

After looking both the judgments the Supreme court held that the National Commision was duty bound to pay serious attention on the Dr. Mayur’s failure to produce the case papers for 6 long years and called upon him to explain why the record pertaining to the treatment given to the appellant was held back from the State Commission till the complainant's evidence was virtually over. The case papers/bed ticket maintained by the hospital of Dr. Mayur would have disclosed the line of treatment adopted by him. Equally intriguing was respondent's failure to file affidavit of Dr. Chudasama to whom he claims to have taken the appellant for treatment. The respondent did try to fill in this lacuna by filing affidavit of Dr. Chudasama before the National Commission. The latter should have enquired as to why he had not filed such affidavit before the State Commission or examined him as a witness before the State Commission. These omissions on the part of the National Commission are extremely serious and have resulted in failure of justice.

For the reasons stated above, the Supreme Court allowed the appeal by setting aside the order of national commission.

Ram Jethmalani v. Subramaniam Swamy

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The case was filed by Ram Jethmalani against Subramaniam Swamy, alleging the charges of defamation.

Subramaniam did issue a few contentious comments in the course of proceedings of a case under Justice M.C. Jain Commission of Inquiry, which was constituted under Commission of Inquiry act 1952. These proceedings were happening for the probe in the assassination of Late Prime Minister Rajiv Gandhi, in which Ms. Jayalalitha’s summon to the court was being contemplated in the court. Ramjethmalani was acting as counsel for Jayalalitha against whom there were allegations of linkage with LTTE. During the course of proceeding Subramaniam also allegedly made defamatory statements about Ramjethmalani. Thus Ramjethmalani sued Subramaniam for compensation of 50 lacs. The judgment was given in favor or Ramjethmalani with compensation of 5 lacs.

RJ (Ramjethmalani) contended the case alleging that the comments issued by Subramaniam were totally uncalled and irrelevant to the proceedings of the case of Inquiry commission, and were made using the case proceedings as platform to malign the reputation of RJ intentionally. On the other hand SS (Subramaniam Swamy) defended citing the provision in section 6 of Commission of Inquiry Act 1952. He argued that the comments were truth and made as fair comment.

According to the principles of defamation, the comments by SS were proven defamatory as the allegation made by him on RJ that LLTE did deposit funds in RJ’s son’s account, was proven false. Secondly, it was axiomatic that the comments were made against RJ. And thirdly, it was established that the comments were published as SS did read the defamatory statement in the proceedings even after they were expunged by the authorities in Justice M.C. Jain Commission of Inquiry.

Also Justice Pradeep Nandrajog took inferences from many past cases and came out with extrapolation that the comments made by SS cannot have any protection through section 6 as he didn’t come under Absolute but only Qualified immunity under section 6 of Commission of Inquiry Act, 1952.

In the judgment honorable Justice also did discuss many theories by means of which SS comments could escape the purview of defamation but each time he reasoned out the very meticulously why those theories and cases are not applicable in this peculiar case.

Concept of Law

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Introduction

Herbert Lionel Adolphus Hart (1907-92) was a British philosopher who was professor of jurisprudence (1952 to 1969) at the University of Oxford.

In The Concept of Law[1] Prof. HLA Hart tries to analyze the relation between law, coercion and morality. He analyses the concept of law and in process discusses such important topics as the foundations of the legal system, law as the union of primary and secondary rules, the sovereign and the subject, the distinction between the notions of law, justice, and morality, the rule of recognition, and international law.

This work by Prof HLA Hart also is a good attempt to reinterpret and rectify the theoretical work of other jurists like Kelson’s basic norm theory, Austin’s imperative theory, and Fuller’s natural law theory.

In this dissertation the researcher will attempt to give an overview on the work of Prof. HLA Hart in his book The Concept of Law.

The methodology will be to come up with summary of each chapter and topic covered in the book with the help of different interpretations and assimilations available in books and text available on the internet.

Concept of Law

Persistent Questions

Perplexities of Legal theory

The question ‘What is Law?’ has been attempted to be addressed by many thinkers but still lots of perplexities subsist as to the definition of law. Many definitions had been given by different thinkers but none of them has come up to stand as undisputed and widely accepted, reason being various flaws in the definition itself.

Still to this highly hyped issue if we think as a common reasonable man, one can identify the similarities between various legal systems and come up with a common definition which describes the functions of law. A legal system comprises of

i. rules forbidding or enjoining certain types of behavior under penalty;

ii. rules requiring people to compensate those whom they injure in certain ways;

iii. rules specifying what must be done to make wills, contracts or other arrangements which confer rights and create obligations;

iv. courts to determine what the rules are and when they have been broken, and to fix the punishment or compensation to be paid;

v. a legislature to make new rules and abolish old ones.

The reason for all the perplexities regarding the definition of law is that apart from the clear standard cases, there also lie the doubtful cases which are hard to be covered under the general definition as till now given by various thinkers. There is always some exception left out which lacks in one or other characteristic of the legal system as given in the definition.

So to find further the base of the problem, let us ponder into some issues which need to be addressed before we try to answer the question ‘What is Law?’.

THREE RECURRENT ISSUES

First issue is that the existence of law means that certain kinds of human conduct are no longer optional, but obligatory, in sense that non-compliance is threatened by some unpleasant consequences. Austin did emphasize on this when he tried to define law.

Second issue is, the existence of law means that certain kinds of human conduct are no longer optional, but obligatory, in sense of moral obligations.

Third issue is whether law consists of rules. For the mere perplexities to the question ‘What is a rule?’ this issue still remains unaddressed. There exist various kinds of rules which originate from myriad sources. Does the law consist of all these kinds of rules? When can be said that a rule exists? What kind of rules do become part of the law?

DEFINITION

The stark existence of these three issues being gone unaddressed properly is the main reason why there is no concrete definition of law yet established in the legal theories. The phenomenon which pertained in the hindrance of the making up of a definition is just like when a man says, ‘I can recognize an elephant when I see one but I cannot define it.’ The definitions yet given also stand a sterile as there are no clear perception of the family or genus to which the subject ‘Law’ belongs, which is essential to define a particular article. The most close genus if any, which can be speculated as the one to which law seems to be a member is rules of behavior. But since the concept or rules itself is not clear, this genus also is full of perplexities. So ‘What is law?’ still remains unanswered.

Laws, Commands, and Orders

VARIETIES OF IMPERATIVES

When any wish is expressed by a person to another, not merely as a piece of interesting information or deliberate self-revelation but with the intention that the person addressed should conform to the wish expressed, it is customary in English and many other languages, though not necessary, to use a special linguistic form called the imperative mood[2]. For e.g. ‘Go home!’ ‘Come here!’ ‘Stop!’ ‘Do not kill him!’.

Similarly there are linguistic forms like request (‘Pass the salt, please’), plea (‘Do not kill me’), and warning (‘Don’t move’), etc.

So when a gunman says that ‘Hand over the money or I will shoot’ is giving a coercive order to the clerk. It should not be confused with command, which is in relation to exploitation of a continuous authority for a relatively longer period. Thus it will be incorrect to say that law is a writ large situation of gunman pointing a clerk to hand over the money.

LAW AS COERCIVE ORDERS

Law cannot merely be said to function by coercive orders. Because its not possible to have each individual of society to be informed about what he is required to do. Law is more general in form rather than specific as in sense that it indicates a general type of conduct and second that it applies to a general class of people who are expected to see that it applies to them and to comply with it[3]. The gunman situation only comes when there is any non compliance with any such system.

Secondly law need not to be addressed to the person concerned, as said by Austin. Law becomes the law of the land the very moment it is enacted. Whether it gets addressed to the persons concerned or whether it disseminates properly to all the class of people to whom it applies is not of concern. So saying that the command needs to be addressed will be wrong to include in the definition of law.

Thirdly, the authority which the gunman enjoys over the clerk when he says ‘hand over the money’ is very short-lived and only coercive one, unlike the authorities which make the statues and enact them, which enjoy authority to issue standing orders to follow time after time by classes of persons.

At last, the body which makes laws should be internally supreme (ultimate authority) and externally independent (not obeying any other authority), to qualify as sovereign.

The Variety of Laws

It is quite established that all laws do not comply to the model of coercive orders, there are also laws which confer some rights or powers to individuals. Similarly there are other many objections that come to mind when we see law just as coercive orders. These objections fall into mainly three categories, namely content of laws, their mode of origin and their range of application.

THE CONTENT OF LAWS

There are various kinds of laws. There are ones which if not obeyed will impose a sanction, the ones which give to rights, the ones which show you the way to do things if you want your wish to be effective, etc.

THE RANGE OF APPLICATION

Mostly, when the law is made by the competent authority, the law makers themselves also get bound by the law, though in private capacity, in the same way as others for whom the law is made. The ‘top-to-bottom’ image of law making can be explained better by pondering into concepts of how promises work, rather than the model of coercive orders.

When a promise is made, it has to be made by appropriate person on appropriate occasion; those who make the promise bound themselves to the things designated by them. This way they impose obligations on themselves and rights for others. This way the promisor exercises the power conferred by rules of making promises.

Similarly when the legislation makes a law, it follows certain set rules to make law. By making law they create obligations for others including themselves in personal capacity.

MODES OF ORIGIN

In most legal systems custom is a source of law subordinate to statute. This means that the legislature could take away their legal status, but failure to do so may not be a sign of the legislator’s wishes.

The theory of law as coercive orders meets at the outset with the objection that there are varieties of law found in all systems which, in three principal respects, do not fit this description. First, even a penal statute, which comes nearest t it, has often a range of application different from that of orders given to others; for such a law may impose duties on those who make it as well as on others. Secondly, other statues are unlike orders in that they do not require persons to do things, but may confer powers on them; they do not impose duties but offer facilities for the free creation of legal rights and duties within the coercive framework of the law. Thirdly, though the enactment of a statue is in some ways analogous to the giving of an order, some rules of law originate in custom and do not owe their legal status to any such conscious law-creating act.

Sovereign and Subject

The existence of sovereign and the subject is considered to be an essential part of any society which possesses law. The two important points which should be considered in any such society are, first, there should be habit of obedience in those to whom the laws made by the sovereign applies. Second the sovereign is considered to be above the law.

THE HABIT OF OBEDIENCE AND THE CONTINUITY OF LAW

Is mere habit of obedience sufficient for continuity of the authority of the sovereign and persistence of laws?

Where comes the question of obedience if the law prohibit any conduct which people do on their own normally without knowing the law which prohibits it? How can we say that it is habit of obedience if we are not sure whether the person, who is supposed to habitually obey, would have done the same act without any existence of any order?

Thus, both the habituality and the obedience are both concepts full of perplexities when incorporated in the model of legal system.

When we talk about the continuity of law, the fact that the subject being obedient to one representative of sovereign does not confer on the new representative any right to succeed the old and give orders in his place. Also, habitual obedience to the old lawgiver cannot by itself render probable that the new legislator’s orders will be obeyed. If by any virtue there is any right to succeed to such legislator by another legislator there should be acceptance of any such complex rule in the society. Here again by rule we mean the rules which differ from mere convergent behavior in the society, like that of going to cinema every weekend.

There are a few differences between the rules and habits. First, for a group to have a habit it is fact that their behavior converges. Deviation from such habit should not be a matter of criticism. On the other hand when we talk about rules, deviation from the standard behavior are regarded as lapses or faults open to criticism, or even with threats of sanction. It should also be noted that mere existence of minority in any such group, which not only breaks such rules but also refuse to look upon it as a standard, does not mean that the rule does not exists.

THE PERSISTENCE OF LAW

Notion of habitual obedience does not account for the persistence of valid laws from one sovereign to another. Secondly, statues are not valid until used by courts under the current sovereign. Such a claim about statutes goes beyond the one about custom by requiring courts to apply them during the reign of the present sovereign. This problem of persistence need not arise if one uses the notion of a rule validating statues under certain conditions[4].

LEGAL LIMITATIONS ON LEGISLATIVE POWER

Sovereign does not enjoy unfettered powers whatsoever. Every sovereign is either bound by the law which he himself makes, or is bound by moral obligations that he gets imposed due the virtue of him being the sovereign.

THE SOVEREIGN BEHIND THE LEGISLATURE

In a composite state the true sovereign is neither the general government, nor the several state governments, both of which are subject to legally binding restraints. Rather, Sovereignty lies in the several united governments as forming one aggregate body, or they and the general government as forming a similar body.[5]

Law as The Union of Primary and Secondary Rules

A system of primary rules, such as a system of positive morality, suffers three sorts of problems.

a) Uncertainty about which primary rules are part of the system

b) Disputes about the interpretation of the primary rules

c) The primary rules are comparatively static

These problems can only be solved by introducing secondary rules (or metarules) into the system, that is, rules about the rules. He recognizes three kinds of secondary rules.

a) A rule of recognition resolves uncertainty about which rules are primary rules by specifying criteria for membership among the primary rules.

b) Rules of adjudication address concerns about the interpretation and application of the primary rules by establishing tribunals to adjudicate disputes about the primary rules.

c) Rules of change ensure that the system of primary rules is dynamic by specifying procedures for modifying the primary rules in light of changing circumstances, beliefs, and values.

The addition of secondary rules to a system of primary rules marks the step from the prelegal world into the legal world.

Primary rules are valid law if they have the right pedigree, that is, they satisfy the criteria in the rule of recognition; secondary rules are valid law by regulating the conduct of officials in the system in the right way. Most officials must adopt an internal, and not merely external, attitude to the secondary rules of the system.

[1] H.L.A. Hart, The Concept of Law, ( Oxford University Press) (1961)

[2] H.L.A. Hart, Concept of Law 18 (2^nd ed. 2005)

[3] H.L.A. Hart, Concept of Law 21 (2^nd ed. 2005)

[4] Michael D. Bayles, HART’S LEGAL PHILOSOPHY 37 (1992)

[5] Wilfrid E. Rumble, Doing Austin Justice 235 (2005)