High Court Madras High Court

A. Grahadurai vs Asstt. Collr. Of C Ex. And Cus. . on 7 January, 1999

Madras High Court
A. Grahadurai vs Asstt. Collr. Of C Ex. And Cus. . on 7 January, 1999
Equivalent citations: 1999 (113) ELT 51 Mad
Author: P Sathasivam
Bench: P Sathasivam


ORDER

P. Sathasivam, J.

1. Since the issue in all these writ petitions is one and the same, they are disposed of by the following common order.

2. For the convenience, I shall refer the facts in the first writ petition, namely, W.P. No. 4536 of 90. The prayer in the writ petition is to issue a writ of Mandamus directing the respondents 1 and 2 herein to for bear from giving Central Excise Duty clearance to the safety matches manufactured by third respondent herein with the petitioner’s approved trade lable, namely, “camel” affixed thereon. Similar relief has been prayed for in the other writ petitions.

3. The case of the petitioner in W.P. No. 4536 of 90 is as follows :- The present writ petition has been filed by one A. Grahadurai, Managing Trustee of P. Ayya Nadar Charitable Trust, Sivakasi. According to him, the said Trust is the absolute and exclusive owner of the Registered Trade Mark “Camel” for safety matches. The said trade mark has been registered as early as in 1954 under the Trade and Merchandise Marks Act. The registration of trade mark in the safety matches is under Clause 34 and Clause 13 is for colour matches. The abovesaid registered trade mark has been periodically renewed and the same is valid upto 13-4-1994. The above said Trust was created by his father while he was alive. The registered trade mark is also one of the properties of the trust. His father died on 27-12-1982 and as per the Trust Deed, he is the Managing Trustee and as such, he has to look after the interests of the Trust. The trust gave permission to certain match manufacturing units to use the abovesaid registered trademark by getting certain amount as royalty. The permission to use the trade mark and payment of royalty to the Trust was based on certain agreement between the trust and such third party who is willing to pay royalty for the use of the trade mark. Such permission was given to the concerned Central Excise authorities in the prescribed form for approval under Rule 71(3) of the Central Excise Rules, for clearing the matches under the petitioner’s trade label. Based on such permission only, the authorities concerned will give clearance for the matches under the trade mark in question. Based on the department’s accounts, royalty was paid. Based on such agreement only, the third respondent was allowed to use the trade mark and clear goods with the petitioner’s trade mark. It is also agreed between the parties that either party by giving two months notice in writing to the other party can cancel the agreement. The petitioner gave such notice on 31-12-1986 to the third respondent. The third respondent gave reply dated 16-1-1987 raising untenable contentions. Such notices were also sent to the 2nd respondent herein. Since no reply was received from the second respondent, the petitioner caused a lawyer’s notice dated 2-3-1990 to be issued to the third respondents herein, separate notice were also sent to respondents 1 and 2. In the said notice it has been specifically stated that the clearance of the third respondent’s safety matches with the registered trade mark of the petitioner. Trust is illegal, since the consent was already revoked. The respondents 1 to 3 herein have sent reply with untenable contentions. The above action clearly indicated that the officials are not interested in taking action, but on the other hand, they are interested in protracting the proceedings by unnecessary replies. In such circumstance, having no other remedy, the petitioner has approached this Court by way of the present writ petition.

4. Respondents 1 and 2 have filed a common counter affidavit wherein it is contended that the above writ petitions emanated out of the dispute between the trustees of P. Ayya Nadar Charitable Trust. A Civil suit has been filed by some of the Trustees before the Sub Court, Srivilliputhur in this regard and the same has not yet been disposed of. The “Camel” brand trade mark lable originally belonged to M/s. The South Indian Lucifer Match Works, Sivakasi, a business establishment belonging to the above said Trust and onwership of label was ultimately vested with P. Ayya Nadar Charitable Trust, Sivakasi through a deed of settlement executed by P. Ayya Nadar who is the founder of the said Trust on 1-10-1980. As the South Indian Lucifer Match Works, Sivakasi had applied for approval of fresh label “Camel”, the label was approved by the Range Officer. The Original licence was issued in 1959. The South Indian Lucifer Match Works was leased by the said P. Ayya Nadar Charitable Trust to M/s. The Rajapalayam Industrial and Commercial Sindicate Limited, Sivakasi by a registered lease deed dated 1-4-1983. The Rajapalayam Industrial and Commercial Syndicate Limited, Sivakasi is having lot of match factories and consent letters were given to all the units under its fold to use the label in question, by M/s. South Indian Lucifer Match Works, Sivakasi and the label were approved by the concerned Range Officers on the strength of the above mentioned consent letters. Before the date of expiry (i.e., 31-3-1988) of registered lease deed dated 1-4-1983, a fresh registered lease deed dated 27-1-1988 was executed by the Trust in favour of the Rajapalayam Industrial and Commercial Syndicate Ltd., for leasing out of South Indian Lucifer Match Works and for using “Camel” brand label wherein the petitioner has not signed even though he was the Managing Trustee of the Trust as claimed by him. The claim of the petitioner being the Managing Trustee of the said Trust itself is disputed by other Trustees and the civil litigation is still pending in then Sub Court, Srivilliputhur. The payment of royalty is a matter between the petitioner and the manufacturers for which the Department is not responsible. Moreover, it is not known, whether the petitioner is the proper person to withdraw or revoke the consent letter given by the South Indian Lucifer Match Works when the other trustees dispute the status of the petitioner as Managing Trustee. With these averments, they prayed for dismissal of the writ petitions.

5. The third respondent has filed a separate counter affidavit raising similar objections. It is stated that a suit in O.S. No. 227 of 1988 is filed before the Sub Court at Srivilliputhur seeking a decree for removal of A. Grahadurai, the petitioner herein, from the Office of the Trustees of Ayya Nadar Charitable Trust, directing the said A. Grahadurai and his brother, A. Vairaprakasam, another trustee, to render accounts and contribute the loss sustained owing to breach of trust and also for granting a permanent injunction restraining A. Grahadurai and his brother A. Vairaprakasam not to interfere with the possession and administration of the Trust properties in any manner. The said suit is pending before the court of learned subordinate Judge, Srivilliputhur. These facts have not been placed before this Court in this writ petition and consequently the petitioner is not entitled to represent the Trust in the present proceedings. He is not entitled to hold office as Managing Trustee either. On the petitioner’s own admission that the purpose of this writ petition is to enforce the payment of the Royalty, which relief the petitioner is not entitled to claim by way of a writ petition. On this ground alone the writ petition is liable to be dismissed. The entire asset of the said business along with the Trade mark was granted on lease by the Trust to Rajapalayam Industrial and Commercial Syndicate Limited. The lease is still subsisting. The Trust does not at present have any interest in the trade mark and is consequently not entitled to maintain any action in respect thereof. The third respondents has validly secured the right to the use of the trade mark from Rajapalayam Industrial and Commercial Syndicate Limited which has full right over the said trade mark. Since the third respondent is using the trade mark it its own right, these matters are to be decided in the suit pending before the Sub Court, Srivilliputhur. It is further stated that inasmuch as the writ petition involves considerable disputed question of facts, which can be determined only by detailed evidence let in by all the relevant parties and cannot be decided in writ jurisdiction; accordingly they prayed for dismissal of all the writ petitions.

6. In the light of the above pleadings, I have heard Mr. R. Thiagaraja, learned Senior Counsel for the petitioner in all the writ petitions, Mr. Vivekanandamoorthy, Additional Central Government Standing Counsel for respondents 1 and 2 and Mr. V. Ramachandran, learned Senior Counsel for the third respondent.

7. Mr. R. Thiagarajan, learned Senior Counsel would contend that after withdrawal of the consent of the petitioner in favour of the third respondent, respondents 1 and 2, the statutory authorities ought to have exercised their powers and stopped giving clearance to the safety matches manufactured by the third respondent. Since the respondents have failed to exercise their powers conferred on them, the petitioner is entitled to seek necessary direction from this Court.

On the other hand, Mr. V. Ramachandran, learned Senior Counsel appearing for the third respondent, after taking me through the lease deed, the various litigations between the petitioner and other Trustees of the Trust, would contend that this Court is not the appropriate forum to settle the issue raised by the petitioner. He also contended that when the petitioner has no power to act as Managing Trustee of the Trust, it is not open to him to claim any relief against the respondents in these proceedings. The learned Additional Central Government Standing Counsel, while reiterating the argument of Mr. V. Ramachandran, would contend that payment of royalty is the matter between the petitioner and the manufacturers for which the respondents 1 and 2 are not responsible and in any event the same cannot be considered in these proceedings.

8. I have carefully considered the rival submissions.

9. It is clear from the pleadings of all the parties that P. Ayya Nadar Charitable Trust is the absolute and exclusive owner of the Registered Trade Mark “Camel” for safety matches. According to the petitioner, the Trust gave permission to certain [match] manufacturing units to use the above said Registered Trade Mark by getting certain amount as Royalty. Admittedly the permission to use the Trade Mark and payment of Royalty to the Trust was based on certain agreement between the Trust and such third party who is willing to pay Royalty for the use of the Trade Mark. It is also the case of the petitioner that such permission was given to concerned Central Excise Authority in the prescribed from for approval under Rule 71(3) of the Central Excise Rules for clearing the matches under the Trade label. Only on such permission the authorities concerned will give clearance for the matches under the Trade Mark in question. Based on the department’s accounts, royalty was paid by the third respondent in all the writ petitions. It is clear that on the basis of the agreement referred above, the third respondent in all the writ petitions was allowed to use the Trade Mark and clear goods with the Trust’s Trade Mark. As per the clause in the agreement, according to the petitioner, he gave notice on 31-12-1986 to the third respondent to cancel the agreement in W.P. No. 4536 of 90. Similar notices were issued in other cases also. It is also the grievance of the petitioner that inspite of cancellation of the agreement and intimating the same to respondents 1 and 2, instead of stopping from clearing the matches under the Trust’s Trade lable, they continued to clear the matches in order to help the third respondent. All the above factual details have been furnished by the petitioner in Paras 4, 5 and 7 of the affidavit. However, the contesting third respondent has stoutly denied the claim of the petitioner. It is the definite case of the third respondent that the petitioner, namely, A. Grahadurai is not entitled to represent the Trust in view of the objection raised by the other Trustees and they also filed suit in O.S. No. 227 of 88 before the Sub Court, Srivilliputhur for removal of A. Grahadurai, petitioner herein from the office of the Trustees of P. Ayya Nadar Charitable Trust. In the very same suit, they prayed for accounts from A. Grahadurai and his brother A. Vairaprakasam. They also prayed for injunction restraining both of them from interfering with the possession and administration of the Trust properties in any manner. The details regarding civil litigation have been mentioned in paragraphs 3,6,13,14 and 19 of the counter affidavit filed by third respondent. Likewise respondents 1 and 2 in their counter affidavit highlighted that the South Indian Lucifer Match Works was leased by P. Ayya Nadar Charitable Trust to Messrs. The Rajapalayam Industrial and Commercial Syndicate Limited, Sivakasi by a registered lease deed dated 1-4-1983. The Rajapalayam Industrial and Commercial Syndicate Limited, Sivakasi is having lot of match factories and consent letters were given to all the units under its fold to use the label in question, by M/s. South Indian Lucifer Match Works, Sivakasi and the label were approved by the concerned Range Officers on the strength of the above mentioned consent letters. It is also seen from their counter affidavit that after the expiry of the registered lease-deed dated 1-4-1983, a fresh registered lease deed dated 27-1-1988 was executed by the Trust in favour of the Rajapalayam Industrial and Commercial Syndicate Limited for leasing out of South Indian Lucifer Match Works and for using “Camel” brand label wherein the petitioner has not signed even though he was the Managing Trustee of the Trust as claimed by him. They also brought to the notice of this Court that the claim of A. Grahadurai being the Managing Trustee of the said Trust itself is disputed by other Trustees and civil litigation is still pending in the Sub Court at Srivilliputhur. They further brought to the notice of this Court that the Department is not in a position to stop the clearance as such and it is open to the petitioner to get redressal in the concerned Court and approach the Department thereafter, if necessary. All the above particulars have been mentioned in Paras 3,4,5 and 7 of the counter affidavit filed by the respondents 1 and 2.

10. It is also clear that due to non-payment of royalty by the third respondent in the above writ petitions, the petitioners has filed the above writ petitions for appropriate directions to the respondents 1 and 2. The payment of royalty is based on the agreement between the Trust and the third respondent in the writ petitions. In other words, payment of royalty is a matter between the petitioner and the manufacturer and if there is any default in payment of the same, the petitioner has to work out his remedy in the appropriate forum and not before this Court.

11. In the light of the grievance of the petitioner, stand of the third respondent disputing the power of A. Grahadurai to represent the Trust and in the light of pendency of the civil suits before the ‘competent civil court, the relief prayed’ for by the petitioner cannot be granted in these writ petitions. No doubt, Mr. R. Thiagarajan, learned senior counsel for the petitioner after pointing out Rule 71(3) of the Central Excise Rules, Section 117 of the Indian Evidence Act and the decision of the Apex Court reported in State of Gujarat v. Shantilal, AIR 1969 Supreme Court 634, contended that the power given under the statute to the respondents 1 and 2 is to do a certain thing in a certain way, and they must do it in that way only. After going through the above mentioned provisions and the decision of the Apex Court, I am of the view that there is no dispute with regard to the above said proposition. The very claim of the petitioner, namely, Managing trustee of P. Ayya Nadar Charitable Trust is in dispute and civil suit is pending before the Sub Court, Srivilliputhur at the instance of the other trustees. In such circumstance, in the absence of any order or decree with regard to the claim and status of the petitioner, I am unable to accept the argument of the learned Senior Counsel for the petitioner. He also relied on the following passage in a decision reported in Commissioner of Police v. Gordhanadas, AIR (39) 1952 Supreme Court 16 :-

“…Public authorities cannot play fast and loose with the powers vested in them, and persons to whose detriment orders are made are entitled to know with exactness and precision what they are expected to do or forbear from doing and exactly what authority is making the order.”

In view of the same reasons mentioned above, the said decision is also not helpful to the petitioner’s case. Mr. R. Thiagarajan, learned Senior Counsel has also pressed into service the observation made by their Lordships in a decision reported in State of Uttar Pradesh v. Bansi Dhar, :-

“…Even so, we are inclined to the view that both testamentary and non-testamentary gifts for public charitable purposes must be saved by a wider intervention of Court, for public interest is served that way. Neither principle nor precedent bars this broader invocation of the Courts’ beneficent jurisdiction…”

It is true that gifts for public charitable purposes must be saved by a wider intervention of court as observed by Their Lordships in the said decision. Here, in our case, as per the categorical pleadings of all the parties concerned, the status and claim of the petitioner is in dispute before the competent Civil Court. Unless and until the same is resolved one way or other, it is not open to this Court to issue necessary directions to the respondents 1 and 2 as claimed by the petitioner.

12. Apart from the above position, Mr. V. Ramachandran, learned Senior Counsel for the third respondent has also brought to my notice various civil suits filed by the trustees against the petitioner and his brother. He also brought to my notice the suit filed by the petitioner himself wherein, according to him there is no whisper in the plaint regarding the revocation of permission. He also brought to my notice that even in the subsequent suits, there is no categorical averments regarding revocation of licence. As rightly contended by the learned senior counsel for the third respondent, the Trust is not the petitioner in all these writ petitions and only A. Grahadurai claiming himself as Managing trustee has filed the above writ petitions. I have already observed that the claim that he is the Managing Trustee of the Trust is under dispute and the other Trustees have already approached the Civil Court. Unfortunately none of the parties are in a position to inform the present stage of the civil litigations filed by the parties concerned. Mr. V. Ramachandran, learned Senior Counsel for the third respondent by relying on a Constitutional Bench judgment of the Supreme Court in Moti Das v. S.P. Sahi, AIR 1959 Supreme Court 942, has contended that in the light of the disputed questions of fact, the writ court cannot adjudicate the claim of the petitioner. The following observation of Their Lordships in that decision is relevant :-

“…In all these cases the High Court has taken the view, rightly in our opinion, that the questions whether the trusts are public or private trusts or the properties are private or trust properties are questions which involve investigation of complicated facts and recording of evidence and such investigation could not be done on writ proceedings …”

Similar view has been taken in State of U.P. and Ors. v. Bridge and Roof Company (India) Limited, .

13. In the light of what is stated above, I hold that the writ petitions involve considerable disputed questions of fact which can be determined only by detailed evidence let in by all the parties concerned and the same cannot be decided in writ jurisdiction. Likewise, the claim for royalty cannot be sorted out or settled in writ proceedings since the same also requires valid oral and documentary evidence. Further, the claim of the petitioner, namely, A. Grahadurai as Managing Trustee itself in dispute before the appropriate Civil Court. Accordingly all the writ petitions are dismissed. No costs. I make it clear that the dismissal of the Writ petitions will not be a bar from agitating the claim before the appropriate forum/Civil Court.