ABOLITION OF IPAB – The Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance, 2021, was promulgated by the President of India through a gazette notification dated April 04, 2021, in order to streamline the operation of tribunals and prevent delays in the administration of justice. Despite promises that the bill would be sent to a standing committee for consideration in light of opposition, the ordinance was passed despite the fact that a bill to that effect had been passed in the Lok Sabha in February and was pending in the Rajya Sabha.
The ordinance is seen as a continuation of the tribunal rationalisation process that started in 2015. Seven tribunals were abolished or combined based on functional similarities under the Finance Act of 2017, but the Act was challenged in court for being passed as a Money Bill in violation of Articles 107, 110, and 117 of the Indian Constitution and for violating the basic tenet of judicial independence.
The Finance Act of 2017 gave the central government the authority to issue rules governing member requirements, terms and conditions of service, and the composition of search and appointment committees for 19 tribunals (such as Customs, Excise, and Service Tax Appellate Tribunal). As directed by the Supreme Court in the Rojer Matthew Case, the ordinance amends the 2017 Act to include provisions related to the composition of search-cum-selection committees and the term of office of members in the Act itself. The ordinance, however, restricts members’ terms to four years, notwithstanding the Supreme Court’s decision in the IPAB Case, which stipulated a minimum term of five years.
The ordinance primarily dissolves existing appellate bodies formed under nine statutes, including the Intellectual Property Appellate Board (“IPAB” or “Appellate Board”), and transfers their functions to concerned High Courts, Commercial Courts/Commercial Division of High Courts, Registrars, and the Central Government.
The changes to various IP laws brought about by the ordinance are mentioned below:
TRADE MARKS ACT, 1999
- The IPAB, which was established under Section 83 of the Trade Marks Act, 1999 to hear appeals against Trademarks Registrar decisions, has been decommissioned.
- The ordinance also transfers the Board’s authority to the High Court, as well as pending cases before the IPAB, to the respective High Courts in whose jurisdiction the Appeal will normally be brought.
- The ordinance removed provisions relevant to the IPAB, such as the establishment (Section 83) and composition of the Tribunal (Section 84), Qualification (Section 85), Term of Office (Section 86), Salaries (Section 88), Resignation and Removal (Section 89), Procedure and Powers (Section 92) Condition on interim order (Section 95) Chairman’s power to transfer cases from one branch to another from the Act.
- The ordinance has lifted the bar on the court’s jurisdiction by removing Section 93 from the Act in order to shift the Board’s power and role to the High Court. It also removes from Section 2 (1) of the Act the definitions of Appellate Board, Bench, Chairman, Judicial Member, Member, Tribunal, and Vice-Chairman.
- The ordinance changes the meaning of “prescribed” from “prescribed by rules made under this Act” to I prescribed by rules made by the High Court in relation to proceedings before the High Court; and (ii) prescribed by rules made under this Act in other cases.”
- Wherever the words “Tribunal” and “Appellate Board” appear in the Act, the ordinance replaces them with “the Registrar or the High Court.”
- The Geographical Indications of Goods (Registration and Protection) Act, 1999 was also amended by the ordinance, which dismantled the IPAB and transferred its powers and duties to the High Court.
COPYRIGHT ACT, 1957
- The Appellate Board, which was created under the Copyright Act of 1957 and was tasked with hearing appeals against the Registrar of Copyrights’ orders, has been dissolved and replaced by Commercial Courts, a division of the High Courts. To do this, the ordinance removed provisions relating to the Appellate Board, including its description under Section 2(aa) of the Act.
- It describes “Commercial Courts” under Section 2 (fa) of the Act as “a Commercial Court constituted under section 3 of the Commercial Courts Act, 2015, or the Commercial Division of a High Court constituted under section 4 of the Commercial Courts Act, 2015, for the purposes of any State.” The newly added definition gives the term “Commercial Courts” the same sense as it does in Section 4 of the Commercial Courts Act, 2015.
- Except in Section 50 of the Act, where the term “Appellate Board” has been replaced with “High Court,” the term “Appellate Board” has been replaced with “Commercial Courts” wherever it appears in the Act.
- The Appellate Board’s authority to hear appeals from the Registrar of Copyrights’ orders will now be delegated to a Single Judge of the High Court. The Single Judge has also been given the authority to refer the case to a larger bench if he or she believes it is necessary.
- After the amendment, any proceeding before the High Court or the Commercial Division of the High Court, including proceedings under section 31D of the Act for the fixation of royalties, must be conducted in accordance with the High Court’s laws, which in this case are the Commercial Courts Act, 2015.
- We should anticipate improved handling of the backlog of Copyright-related commercial disputes in the near future, as section 14 of the Commercial Courts Act mandates expeditious disposition of appeals.
CINEMATOGRAPH ACT, 1952
- The Appellate Tribunal formed under the Cinematograph Act of 1952 was abolished by the ordinance, which deleted Section 2(h) of the Act.
- It replaces the words “Appellate Tribunal” with “High Court” in Section 7C of the Act. As a result, the Tribunal’s authority to hear appeals against Censor Board decisions has been transferred to the concerned High Court. As a result, such appeals must now be lodged directly with the High Court in question.
PROTECTION OF PLANT VARIETIES AND FARMERS’ RIGHTS ACT, 2001
- The Plant Varieties Protection Appellate Tribunal, which was formed under Section 54 of the Protection of Plant Varieties and Farmers’ Rights Act of 2001, has been decommissioned.
- The ordinance repealed provisions relating to the Tribunal, such as the definitions of Chairman, Member, and Judicial Member, as well as the Tribunal’s creation (Section 54), composition (Section 55), and procedure.
- Wherever they appear in the Act, the word “Tribunal” has been replaced with “High Court.”
- As a result, the Tribunal’s authority to hear appeals against the Registrar of Plant Varieties Registry and Protection of Plant Varieties and Farmers’ Rights Authority’s decisions has been transferred to the concerned High Court.
- Both such appeals will now be filed directly with the relevant High Court, and any pending cases will be moved there as well.
Patents Act, 1970
- The Patents Act, 1970 established the Appellate Board, which had the authority to hear appeals under Section 117A of the Act against orders of the Controller General of Patents, Designs and Trade Marks (“CGPDTM”) or the Central government.
- The ordinance, like the previous amendments, excludes clauses relating to the Appellate Board, such as its creation (Section 116) and composition (Section 117), Procedure, and Powers (Section 117B and 117D).
- The ordinance has lifted the bar on the court’s jurisdiction by removing Section 117C from the Act, transferring the Board’s power and purpose to it.
- Both the High Court and the Appellate Board were meant to act concurrently prior to the amendment; however, the Appellate Board has since been removed from all of those positions. Furthermore, the Appellate Board has been replaced with the High Court in cases where only the Appellate Board appeared.
CONCLUSION – ABOLITION OF IPAB
Although few may see it as a significant shift in IP dispute resolution, others, such as the Group of Industry Associations on Intellectual Property, have expressed their displeasure with the move. Nonetheless, because the Appellate Boards were formed to expedite the backlog of cases, and they failed to achieve their goal, it appears to be a wise step on the part of the government. However, given the Indian judiciary’s reputation for case backlogs, simply abolishing the Appellate Tribunal would be ineffective unless separate commercial courts/benches are set up to handle these cases. In relation to Copyright disputes, the Appellate Board has been replaced by the High Courts and Commercial Courts, which means the expense of instituting litigation before the respective judicial bodies would be determined in compliance with the Code of Civil Procedure, 1908, and the Commercial Courts Act, 2015.
The elimination of the Appellate Board creates a new challenge for royalty rates, which are set to be reviewed by the end of the year. The ordinance may have made the whole process under Section 31D of the Copyright Act much more difficult. This means that any process recommended under the Copyright Rules, 2013 in relation to the above proceeding is nullified, and we may anticipate the Central Government using its power under Section 21A of the Commercial Courts Act, 2015 to frame rules similar to Rule 31 of the Copyright Rules, 2013.