KROSS S.A. V VIJAY MUNJAL AND ANR. (2023)

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KROSS S.A. V VIJAY MUNJAL AND ANR. (2023)

CITATION	C.O. (COMM.IPD-TM) 358/2021
DATE OF JUDGMENT	10 OCTOBER, 2023
COURT	HIGH COURT OF DELHI
PETITIONER	KROSS S.A.
RESPONDENT	VIJAY MUNJAL AND ANR.
BENCH	HON’BLE MR. JUSTICE C. HARI SHANKAR

INTRODUCTION

The case of “Kross S.A. v. Vijay Munjal and Anr.” revolves around the concept of Amendment of Pleading. Provision regarding the Amendment of Pleadings is given under Order VI Rule 17 of Code of Civil Procedure, 1908. In this case Petitioner seeks to amend the plaint and memo of parties accompanying the plaint. The application for amendment of plaint was sought by Petitioner after commencement of trial. So, this case specifically deals with the proviso of Order VI Rule 17. The said proviso deals with the amendment sought after commencement of trial. The suit for which this application of amendment is filed by Petitioner was related to infringement of trademark ‘KROSS’ registered to plaintiff. The name of that case is Kross S.A. v Hero Eco Group and Ors. [CS(COMM) 326/2018].

Kross is a company related to bicycles and parts thereof, which according to plaintiff (Petitioner in present case of amendment of plaint) is a well-known and famous trademark. The judgment in the present case sheds light on the interpretation of proviso of Order VI Rule 17 and also on the application of it.

FACTS OF THE CASE

Initially plaintiff KROSS S.A. instituted a suit against defendants in the Intellectual Property Division (IPD) of the Delhi High Court for infringement of its registered trademark ‘KROSS’ [Kross S.A. v Hero Eco Group and Ors., CS(COMM) 326/2018]. According to the plaintiff its trademark is well-known and famous in the bicycle industry. Therefore, the suit seeks a decree of permanent injunction and restraining the defendants from using the said trademark.

Initially, the suit was filed against three defendants. Defendant 1 was Hero Eco Group, Defendant 2 was Mr. Vijay Munjal, and Defendant 3 was Hero Eco Tech Limited. Later, by order dated 20 February 2014, Hero Eco Group was removed from the case. So, in the present case there are only two defendants. Defendant 1, Mr. Vijay Munjal, and Defendant 2, Hero Eco Tech Limited.

After the institution of this suit a separate case was filed by V R Holdings & Mr. Vijay Munjal against Kross S.A.& Anr [V.R. HOLDINGS & ANR. V KROSS S.A. & ANR, CS(COMM) 695/2018]. The purpose of this second suit was to stop plaintiff Kross S.A. to use the trademark ‘KROSS’ because it was also owned by V.R. Holdings.

Later, after the summons were issued for Kross S.A. v Hero Eco Group and Ors. case, the defendants filed their written statement on September 30, 2013. Then, the plaintiff filed their replication (plaintiff’s reply to written statement) on October 7, 2013. The issues were framed on April 23, 2014, and the recording of evidence started on March 20, 2014, and finished on July 20, 2017. At that point, the court categorized the case as ready for final decision. Following that, both parties submitted their written arguments, and the verbal arguments began.

During the verbal arguments, on January 7, 2020, Hon’ble Mr. Justice Rajiv Sahai Endlaw, J., said in its order that though plaintiff has sued Mr. Vijay Munjal, who is also the partner of plaintiffs in the case of V.R. Holdings & Anr. v Kross S.A & Anr., there would be no end of litigation because he is mere a user of the mark. In the case of V R Holdings & Anr. v Kross S.A & Anr. Plaintiff 1 in his personal capacity claimed the rights of the mark who is the proprietor of it. Infact Plaintiff 1 authorized Mr. Vijay Munjal to use the mark ‘KROSS’. Therefore, even if a court issued an injunction and restraining order against the defendants in the case of Kross S.A., the proprietor of the mark will be free to authorize any other person for the use of the mark. Hence, plaintiff Kross S.A. should have sued the proprietor of the mark instead of suing only the user of the mark. When the court asked the counsel of the plaintiff Kross S.A. for the same they demanded further time to consider. But, the counsel of plaintiffs in the case of V R Holdings & Anr. opposed this contending that they are also entitled to be heard and they also didn’t have interim order to stop Kross S.A. from using the trademark. The counsel of plaintiff in Kross S. A. case replied that the mark is not currently in use by the plaintiff Kross S.A. either. Hon’ble Mr. Justice Rajiv Sahai Endlaw, J. at last said that the two cases, Kross S. A. case and V.R. Holdings case, had consolidated for the trial and the case having Kross S.A. as plaintiff had ordered as lead case, it would be appropriate to adjourn the case.

This judgement provoked the plaintiff Kross S.A. to file a petition to amend his plaint and memo of parties, to add V.R. Holdings and his partners as defendants and also to add allegations in plaint against them.

When this petition of amendment of pleading was filed the trial has already begun and final arguments were going on. Hence, this case came under the proviso of Order VI Rule 17 of CPC. The proviso forbids court to allow amendment in pleadings after commencement of trial unless the court is satisfied that despite due diligence it was impossible for parties seeking amendment to raise the issue which is sought to be raised by amendment before the trial commenced.

Order VI Rule 17 reads following-

“Amendment of Pleadings.- The Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties:

Provided that no application for amendment shall be allowed after the trial has commenced, unless the court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of trial.”

ISSUES RAISED

Whether the petitioner Kross S.A. had exercised the due diligence?
Whether, despite due diligence, it was impossible to add V.R. Holdings and its partners as defendants before the commencement of the trial?

CONTENTIONS OF PETITIONER

The petitioner contended that it was the order dated 7 January, 2020 passed by Endlaw, J., which provoked the amendment. Therefore, it was impossible to raise the amendment to add V.R. Holdings and its partners as defendants before the commencement of the trial.
The petitioner also submitted that the rules for grant for amendment before commencement of trial equally applies to the amendment requested after the commencement of trial. He also contented that the main concern for the court should be to make sure that the other party isn’t treated unfairly.
The counsel of the petitioner placed reliance on the certain paragraphs of the cases of Supreme Court which were LIC v. Sanjeev Builders Pvt Ltd, Ganesh Prasad v.Rajeshwar Prasad, Chander Kanta Bansal v. Rajender Singh Anand, Abdul Rehman v. Mohd Ruldu and State of Madhya Pradesh v. UOI.
The gist of all those paragraphs is given below-

– The request for amendment should be granted if:

– It’s necessary to properly adjudicate the dispute between the parties.

– It helps avoid unnecessary additional legal proceedings.

– The amendment doesn’t result in injustice to the other party.

– The party requesting the amendment isn’t trying to withdraw any clear admission that benefits the other party.

– The amendment doesn’t introduce a time barred claim, which would unfairly deprive the other party of their rights in certain situations.

– Generally, a request for amendment should be granted unless:

– It introduces a time barred claim, in which case the fact that the claim is time-barred matters.

– It changes the fundamental nature of the lawsuit.

– The request for amendment is malafide.

– The other party loses a valid defense because of the amendment.

– Simply because there’s a delay in requesting an amendment doesn’t automatically mean the request should be denied. If the question about delay is arguable, the request for the amendment might still be approved, and the question of limitations would be addressed separately for a decision.

– The decision related to the amendment sought before the commencement of trial should be liberal. The only matter which the court has to consider that the amendment does not result in irreparable prejudice to the opposite party.

– Parties can amend their pleadings at any stage to clarify the real issues in the case. Courts should be liberal in allowing amendments before trial. If amendments are requested after trial begins, the court must determine if the party couldn’t have raised the issue earlier despite due diligence.

CONTENTIONS OF REPONDENTS

The counsel of respondents while responding to petitioner’s arguments, pointed out a specific section in the replication to the written statement. In that section, the plaintiff denies the claim of mis-joinder of parties or non-joinder of parties in the lawsuit. It states that Mr. Vijay Munjal, Defendant No. 2, is associated with the Hero Eco Group and VR Holdings, so there’s no misjoinder or absence of necessary parties.
Respondents also pointed out that the plaintiff knew, even when giving replication to the written statement, that Mr. Munjal was associated with Hero Eco Group and VR Holdings. The plaintiff made a deliberate decision not to include VR Holdings as a party and asserted that the suit wasn’t flawed due to non-joinder of parties. Therefore, the plaintiff cannot claim now, with an amendment request, that they couldn’t have raised these points before commencement of trial despite being diligent.

JUDGEMENT

The Delhi High Court dismissed the application of amendment.
Court said that according to the proviso of Order VI Rule 17 if an amendment is requested after the commencement of trial, the court needs to be sure of two things before allowing it. Firstly, the party seeking the amendment must have shown due diligence. Secondly, even with due diligence, the court must be convinced that the issue couldn’t have been raised before the commencement of trial.
Further court opined that neither of these two consideration is applicable in the present case. In fact, the application doesn’t even plead that the plaintiff acted diligently before the trial started or they couldn’t have included the new defendants or raised the new claims despite due diligence. Moreover, in response to the Court’s question about why the amendment wasn’t requested before the trial started, the counsel of petitioner candidly admitted that it was likely a mistake.
Furthermore, the court also stated that the judgments of the Supreme Court cited by the petitioner didn’t lessen the strictness of the proviso of Order VI Rule 17. Neither could it be concluded that where the proviso is applicable, the court can be as liberal in granting amendments as it is in cases where amendments are requested before the commencement of the trial.
Also along with accepting the contention of respondents court said that counsel of petitioner’s only explanation for the plaintiff’s failure to raise the points now being sought through an amendment is that it was a mistake. However, in my view, claiming a mistake doesn’t meet the requirements of showing either due diligence or the inability to raise these points before the trial started. Therefore, the court is legally prohibited, under the proviso to Order VI Rule 17 of the CPC, from allowing this amendment.

Apart from this, court has also elaborated Order VI Rule 17 and its proviso, which is as following:

The proviso to Order VI Rule 17 of the CPC imposes a strict limitation on the court. There’s a significant difference in the law before and after the commencement of trial. The court should generally be very liberal when considering an application for amendment prior to commencement of trial in allowing amendments, as seen in the judgments of the Supreme Court in LIC v. Sanjeev Builders Pvt Ltd and Ganesh Prasad v. Rajeshwar Prasad. The main consideration for an application for amendment prior to commencement of Trial for the court is whether the amendment would harm the other party. If the amendment wouldn’t cause harm and it’s requested before the trial, the court usually grants it.
Once the trial begins, everything changes. The proviso becomes crucial, using the term “shall” which indicates a mandatory requirement.

ANALYSIS

The case deeply explores the provision related to Amendment of Pleadings given under Order VI Rule 17 of Code of Civil Procedure, 1908. Points which is made clear via this case can be summarized as following-

According to the provision outlined in Order VI Rule 17 of the CPC, the court must adopt a liberal approach when granting the requested amendments by parties, provided that the application for such amendment is filed before the commencement of the trial. In this situation the only question which court need to consider is whether the amendment do any injustice to the other party. If there is no such case the amendment must be allowed.
The main body of Order 6 Rule 17 has two parts:

i. The first part is discretionary (“may”), allowing the court to decide on amendments to pleadings.

ii. The second part is imperative (“shall”), requiring the court to allow all necessary amendments to determine the real dispute between the parties.

But, this position completely changes if the applicant for amendment of pleadings is filed after commencement of trial. The proviso of Order VI Rule 17 deals with the application filed after commencement of trial. In this situation court must take a rigid approach.
If the application for amendment is filed after commencement of trial then court must take two questions in consideration, Firstly, the party seeking the amendment must have shown due diligence. Secondly, even with due diligence, the court must be convinced that the issue couldn’t have been raised before the commencement of trial. If the application satisfy these considerations only when an application for amendment after commencement of trial must be allowed.
Furthermore the proviso to Order VI Rule 17 uses the term “shall,” indicating a mandatory requirement. The Supreme Court clarified that “shall” in the main part of Order VI Rule 17 should be considered mandatory, consistent with the principle that the same expression used twice in a provision usually carries the same meaning.
It is notable that Rule 17 of the Code of Civil Procedure was initially repealed in 1999 to expedite trials, but due to controversy and protests, it was reinstated in 2002 with limitations on amendment powers. The new proviso restricts amendments after the trial starts unless the court finds due diligence was impossible. This balances the need to expedite trials with fairness in individual cases.

This case also explains amendments which must be provided by court:

– The request for amendment should be granted if:

It’s necessary to properly adjudicate the dispute between the parties.
It helps avoid unnecessary additional legal proceedings.
The amendment doesn’t result in injustice to the other party.
The party requesting the amendment isn’t trying to withdraw any clear admission that benefits the other party.
The amendment doesn’t introduce a time barred claim, which would unfairly deprive the other party of their rights in certain situations.

-Generally, a request for amendment should be granted unless:

It introduces a time barred claim, in which case the fact that the claim is time-barred matters.
It changes the fundamental nature of the lawsuit.
The request for amendment is malafide.
The other party loses a valid defense because of the amendment.
Simply because there’s a delay in requesting an amendment doesn’t automatically mean the request should be denied. If the question about delay is arguable, the request for the amendment might still be approved, and the question of limitations would be addressed separately for a decision.

CONCLUSION

In conclusion, the case of KROSS S.A. V VIJAY MUNJAL AND ANR. establishes a significant precedent regarding the Amendment of Pleadings. While the case emphasizes the court’s obligation to adopt a liberal approach in granting amendments before commencement of trial to prevent injustice and multiple lawsuits, it also emphasizes that parties’ own negligence in pleadings won’t be considered if applied after the commencement of trial.

REFERENCES

This Article is written by Himadri Jaiswal student of Mahatma Gandhi Kashi Vidyapith University, Varanasi; Intern at Legal Vidhiya.

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