VISA INTERNATIONAL Ltd. v VISA INTERNATIONAL SERVICE ASSOCIATION & Anr.

The Calcutta High Court pronounced a landmark judgment on August 2, 2024, in the case Visa International Ltd. v. Visa International Service Association, IPDTMA Nos. 82 & 83 of 2023 and IPDTMA No. 1 of 2024, wherein they dealt with the scope and limitation of the powers of the contractual Associate Managers at the Trademark Registry. Justice Krishna Rao held that on a contractual appointment, Associate Managers were not vested with the jurisdiction to make quasi-judicial orders; therefore, the decisions made by him in the impugned orders in opposition proceedings under the Trade Marks Act, 1999 were quashed.

The main issue proposed in the appeals was whether officers with a title of “Associate Manager” were authorized by law to hear opposition proceedings and to make reasoned orders. The appellants argued that the impugned orders were invalid ab initio because they were made by persons whose terms had expired or who were not armed with statutory powers to exercise such quasi-judicial powers under the Act.

The Trade Marks Act, 1999, Section 3(2) enables the Central Government to appoint officers to perform the duties of the Registrar, under the superintendence and direction of the Registrar, and that he/she can designate such officers as he/she thinks fit. Also, Section 2(2)(d) widens the scope of the term Registrar to cover any officer so authorised. The Calcutta High Court, however, pointed out that although administrative powers can be delegated under this section, quasi-judicial powers, like determination of oppositions, are to be clearly and lawfully delegated, which was not in the instant case.

The appellants relied on cases to emphasise their submission that actions performed by authorities without jurisdiction become a nullity. The Supreme Court in Hindustan Zinc Ltd. v. Ajmer Vidyut Vitran Nigam Ltd., declared that jurisdictional flaws make orders invalid and such arguments can be made at any point. Also, in Rajasthan State Industrial Dev. & Inv. Corp. v. Subhash Sindhi Coop. Hsg. Society, it was reinforced that void actions do not require any set aside; they are a void ab initio.

In the same manner, in Noor Mohammad v. Khurram Pasha the Court has highlighted that where a statute lays down a certain procedure, the same must be followed and other means or ways are unacceptable. All these principles backed the argument presented by the appellants that orders made by officers who were not allowed to do so lacked legal sanctity.

The appellants have also used the Intellectual Property Attorneys Ass v. Union of India, where the Delhi High Court ruled that the Registrar under the Trade Marks Act carries out quasi-judicial duties. Such adjudicatory functions, therefore, can only be exercised by such officers as are duly empowered under the Act.

On the contrary, the respondents claimed that the appointments of such officers as Mr. Shraman Chattopadhyay and Mr. Saurabh Dubey had been done by way of public notice, contractual appointment and supported by office orders which empowered them to hold departmental hearings. The case law they referred to was J.K. Medical System (P) Ltd. v. Union of India in which the Madras High Court ruled that the Central Government has the power to appoint any officers of any designation to discharge the duties of the Registrar, on the condition of adequate authorisation.

An additional backing was based on B. Premanand v. Mohan Koikal, wherein the Supreme Court approved of a literal rule of statutory interpretation, that is, the language of the statute cannot be distorted or expanded unnecessarily. In The Registrar, Trademarks v. Kumar Ranjan Sen, it was ruled that the administrative superintendence of the Registrar does not extend to quasi-judicial directions. The respondents further argued that procedural legitimacy in the disputed orders and appointments were confirmed by such judgments.

However, Calcutta High Court opined that there was no material on record to demonstrate that on the date of delivery of impugned order (September 16, 2023), the contractual appointment of Mr. Chattopadhyay (which had lapsed on March 31, 2023), had been extended. On the same note, no legitimate devolution of the quasi-judicial authority to Mr. Saurabh Dubey was demonstrated. Also, with the Recruitment Rules which were notified in 2011 under Article 309 of the Constitution, the designation of Associate Manager was not recognized and therefore the status of the supposed roles is not valid.

By reference to State of Punjab v. Gurdev Singh, and N. Mani v. Theatre, the Court again stated that, acts committed without legal authority will be deemed as void and thus may be questioned at any moment. Further, in Prasun Roy v. Calcutta Metropolitan Dev. Authority, the Supreme Court ruled, where there was a jurisdictional defect, acquiescence would not repair the defect.

Eventually, the Calcutta High Court quashed the impugned orders issued by the Associate Managers and referred the cases back to a competent authority to be adjudicated on afresh within a period of six months. The Court was emphatic that the delegation of quasi-judicial powers under Section 3(2) has to be legitimate, in traceable and understandable otherwise, the decisions that are made cannot stand the test of the law.

This ruling highlights a crucial point about the administrative law in India that the delegation of power must comply with the letter and spirit of the statutes. It also serves as testimony to the judiciary in ensuring that the adjudicatory functions under the Trade Marks Act are executed by those who are legitimately entitled to do so, thus maintaining the integrity of the Intellectual property rights system.

The judgment of the Calcutta High Court in the case of Visa International Ltd. v. Visa International Service Association (2024) is an important reminder that the statutory power cannot be presumed or improvised, least with regard to quasi quasi-judicial role. The core of this judgment can be seen in the fact that this is a cardinal provision of administrative and constitutional law, that an adjudicatory exercise of any statute, including the Trade Marks Act, 1999 by an officer can only be suitably fulfilled upon those officers who are duly authorized through legal means.

The fact that the Court overturned orders which were merely passed by contractual Associate Managers whose appointments were lapsed or otherwise not recognized as statutory has enabled the Court to draw a line between administrative convenience and its legal validity. The judgment also supports the premise that the statutory process has to be observed even in an administrative system where oppositions are pending and faster resolution is possible. The use of administrative shortcuts that disregard the hierarchy of authority provided in the statute or have not provided adequate delegation of authority may turn the whole legality process invalid.

Besides, the decision elucidates the subtle difference existing between administrative and quasi-judicial powers under Section 3(2) of the Act. Although an officer might be charged with the right of administering certain duties under the watch of the Registrar, the quasi-judicial power makes a different mark- a legal amendment in lieu of a clear statutory delegation and adherence to procedure.

This case provides precedent that more attention is paid to appointments and power matters in intellectual property management and beyond. It gives very clear signals to regulatory agencies and governmental institutions that the efficiency of an institution can never be at the expense of being legal. Significantly, it also guarantees that the rights of applicants and objectors in the disputes of trademarks are determined and passed by those officers who have the legal means as well as structural authority to do so.

The judgment sets a critically important judicial benchmark as the issues are sent back to be adjudged afresh to safeguard due process in the trademark law in India.