THE HIGH COURT OF DELHI AT NEW DELHI % Judgment delivered on:
09. 01.2015 + W.P.(C) 4330/2012 MAHARASHTRA HYBRID SEED CO. versus UNION OF INDIA AND ANR + W.P.(C) 4365/2012 SUNGRO SEEDS LTD versus UNION OF INDIA AND ANR + W.P.(C) 4366/2012 DCM SHRIRAM CONSOLIDATED LTD. versus UNION OF INDIA AND ANR + W.P.(C) 6199/2012 M/S BAYER BIOSCIENCE PVT LTD versus UNION OF INDIA AND ANR + W.P.(C) 7853/2012 MONSANTO HOLDINGS PVT LTD AND ANR versus UNION OF INDIA AND ANR ..... Petitioner ..... Respondents ..... Petitioner ..... Respondents ..... Petitioner ..... Respondent ..... Petitioner ..... Respondents ..... Petitioner ..... Respondents Advocates who appeared in this case: For the Petitioners :Mr R. Parthasarthy and Mr Anil Dutt and Mr Sudarshan S. Shekhawat for petitioner in all matters. For the Respondents :Mr Saqib for R-1/UOI in W.P.(C) 4330/2012. Mr Anil Soni, CGSC with Ms Saakshi Agarwal for R-1/UOI in W.P.(C) 4365/2012 & W.P.(C) 4366/2012. Mr Amit Mahajan CGSC with Mr Nitya Sharma for R-1/UOI in W.P.(C) 6199/2012. Mr Vivek Goyal, CGSC for R-1/UOI in W.P.(C) 7853/2012. Mr Ram Niwas Buri for R-2 in all matters. Mr Jayant Bhushan, Sr. Advocate with Mr Abhishek Saket, Mr Amarjeet Kumar and Mr Manish Madhukar. CORAM:HON’BLE MR JUSTICE VIBHU BAKHRU
JUDGMENTVIBHU BAKHRU, J1 The petitioners impugn a common order dated 24.05.2012 (hereafter the ‘impugned order’) passed by the Registrar, Protection of Plant Varieties and Farmers’ Rights Authority holding that parent lines of known hybrid varieties, could not be registered as “new” plant varieties under the Protection of Plant Varieties and Farmers’ Rights Act, 2001 (hereafter the ‘Act’). It was held that if the hybrid falls under the category of extant variety about which there is common knowledge then its parental lines cannot be treated as novel.
2. The principal question to be decided is whether the parent lines of extant hybrid varieties can be considered as novel plant varieties for the purposes of registration under the Act. Submissions 3. The learned counsel for the petitioners contended that the hybrid seeds, obtained from crossing the parental lines, are distinct in traits and characteristics from the parent lines and cannot be considered as propagating or harvested material of the parental line varieties. It was contended that the propagating/harvested material of a variety would mean any part of a plant or seed, which is capable of regeneration into a plant having same characteristics as the original plant. Since regeneration of hybrid seed would not result in the parental lines but the hybrid plant variety that is distinct from the parent line varieties, the hybrid seeds obtained from crossing of parent lines could not be said to be propagating or harvested material of the parental lines.
4. It was submitted on behalf of the petitioners that a ‘variety’ is defined ‘by the expression of the characteristics’ and as the characteristics of the hybrid variety are different from the parental line, the parent lines could not be considered the same as the hybrid variety.
5. It was submitted that the development and sale of hybrid seeds would not amount to exploitation of the parental lines. It was contended that the words ‘disposed of’ as used in Section 15(3) of the Act, could not be read in isolation and would not include ‘self use’ and ought to be read synonymous to ‘sale’. It was submitted that the word ‘disposal’ contemplates transferring of title from one party to another party and in the process of hybridization, the title of parent lines were not parted with or transferred to third parties and, therefore, the sale of hybrid seeds would not amount to disposal of parent lines. The petitioners relied upon the decision of the Supreme Court in Deputy Commissioner of Sales Tax (Law, Board of Revenue (Taxes), Ernakulam v. Thomas Stephen & Co. Ltd., Quilon: (1988) 2 SCC264in support of the above contention.
6. The learned counsel for the petitioners also referred to other statutes regarding registration of plant varieties, as in force in the United States and European Union and pointed out that the language of those statutes provided a legal fiction that the parent lines would ‘deemed to be’ or ‘considered to be’, known if the hybrid was sold or otherwise disposed of. He submitted that as such words imputing a legal fiction were absent in relevant provisions of the Act, the parent lines would have to be considered as novel irrespective of the status of the hybrid.
7. The learned senior counsel for the interveners contended that the hybrid seeds produced by crossing of the parental lines, were the propagating or harvested material of each of the parental lines and the commercial exploitation of such hybrid seeds for more than one year prior to the date of application, would make the parent line ineligible to be registered as a new variety.
8. The learned counsel for the interveners submitted that the Act did not require that the harvested material of a variety should also be a variety in itself or that it should be able to reproduce the parent variety. He further submitted that the distinction sought to be drawn between the US/ European laws and the Act was erroneous. The learned counsel for the interveners contended that the word ‘deemed’ could not, in all cases, be read to create a legal fiction and in some cases, may also be used to mean what is obvious. He relied upon the decision of the Supreme Court in Consolidated Coffee Ltd. and Anr. v. Coffee Board, Bangalore: (1980) 3 SCC358in support of his contention.
9. It was also submitted on behalf of the interveners that the discretionary power exercised by an authority under the Act should not be interfered with unless it is established that the exercise of discretion is arbitrary and capricious and in violation of law. It was contended that judicial review in technical matters was limited and warranted only if the decision of the authority was held to be arbitrary or mala fide. The interveners relied upon the following decisions of the Supreme Court in support of this contention: Federation of Railway Officers Association and Ors. v. Union of India: (2003) 4 SCC289 Tata Iron & Steel Co. Ltd. v. Union of India and Anr.: (1996) 9 SCC709and Akhil Bharat Goseva Sangh v. State of A.P. & Others: (2006) 4 SCC162 Reasoning and conclusion 10. The limited controversy that needs to be addressed is whether the parental lines would be eligible for being considered as “novel” under Section 15(3)(a) of the Act, if the hybrid seeds of such parental varieties have been disposed of for producing the hybrid variety.
11. The preamble of the Act indicates that it is “An Act to provide for establishment of an effective system for protection of plant varieties, the rights of farmers and plant breeders and to encourage the development of new varieties of plants”. The preamble also indicates that the Act was enacted pursuant to India’s ratification of the Agreement on Trade Related aspects of Intellectual Property Rights (TRIPS Agreement). Sub paragraph (b) of paragraph 3 of Article 27 in part II of the TRIPS Agreement enjoins the members to provide protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. Paragraph 3 of Article 27 is quoted below:
“3. Members may also exclude from patentability: (a) diagnostic, therapeutic and surgical methods for the treatment of humans or animals; (b) plants and animals other than microorganisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. However, Members shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. The provisions of this subparagraph shall be reviewed four years after the date of entry into force of the WTO Agreement.”
12. Section 13 of the Act provides for maintaining of a register called the national register of plant varieties, which would record the name of all registered plant varieties along with names and address of their respective breeders and their rights in respect of such plant varieties. If the application for registration of an “essentially derived variety” or a “variety” is accepted and the said plant variety is registered, the Registrar is enjoined to issue a certificate of registration under Section 23(8) of the Act (in case of essentially derived variety) and Section 24 of the Act (in case of variety). By virtue of Section 24(6), the registration certificate is valid for a period of 9 years in case of trees and vines and 6 years in case of other crops. The registration is renewable for further periods, however, the total period of validity cannot exceed :
“(i) in the case of trees and vines, eighteen years from the date of registration of the variety; (ii) in the case of extant varieties, fifteen years from the date of the notification of that variety by the Central Government under section 5 of the Seeds Act, 1966 (54 of 1966); and (iii) in the other cases, fifteen years from the date of registration of the variety.”
13. By virtue of Section 28(1) of the Act, a certificate of registration under the Act confers an exclusive right on the breeder or his successor, agent or licensee to produce, sell, market, distribute, import or export the variety.
14. Section 15(1) of the Act provides “novelty, distinctiveness, uniformity and stability” to be the requisite criteria for the registration of a variety as a new variety. Section 15(2) of the Act also enables “extant variety” to be registered within a specified period if it conforms to the criteria of distinctiveness, uniformity and stability. As per Section 15(3)(a) of the Act, a new variety shall be deemed to be novel if the propagating or harvested material of such variety has not been sold or otherwise disposed of, prior than one year from filing of the application for registration, for the purposes of exploitation of such variety in India.
15. Essentially, the controversy involves interpretation of Section 15 of the Act, which is quoted below:
“15. Registerable varieties.—(1) A new variety shall be registered under this Act if it conforms to the criteria of novelty, distinctiveness, uniformity and stability. (2) Notwithstanding anything contained in sub-section (1), an extant variety shall be registered under this Act within a specified period if it conforms to such criteria of distinctiveness, uniformity and stability as shall be specified under the regulations. (3) For the purposes of sub-sections (1) and (2) as the case may be, a new variety shall be deemed to be— (a) novel, if, at the date of filing of the application for registration for protection, the propagating or harvested material of such variety has not been sold or otherwise disposed of by or with the consent of its breeder or his successor for the purposes of exploitation of such variety— (i) in India, earlier than one year; or (ii) outside India, in the case of trees or vines earlier than six years, or, in any other case, earlier than four years, before the date of filing such application: Provided that a trial of a new variety which has not been sold or otherwise disposed of shall not affect the right to protection: Provided further that the fact that on the date of filing the application for registration, the propagating or harvested material of such variety has become a matter of common knowledge other than through the aforesaid manner shall not affect the criteria of novelty for such variety; (b) distinct, if it is clearly distinguishable by at least one essential characteristic from any other variety whose existence is a matter of common knowledge in any country at the time of filing of the application. Explanation.—For the removal of doubts, it is hereby declared that the filing of an application for the granting of a breeder’s right to a new variety or for entering such variety in the official register of varieties in any convention country shall be deemed to render that variety a matter of common knowledge from the date of the application in case the application leads to the granting of the breeder’s right or to the entry of such variety in such official register, as the case may be; 16. (c) uniform, if subject to the variation that may be expected from the particular features of its propagation it is sufficiently uniform in its essential characteristics; (d) stable, if its essential characteristics remain unchanged after repeated propagation or, in the case of a particular cycle of propagation, at the end of each such cycle.”
It is apparent from above that in order to qualify as a new variety registerable under Section 15(1) of the Act, the plant variety must conform to the criteria of “novelty, distinctness, uniformity and stability”. By virtue of Section 15(2) of the Act, an extant variety may also be registered even though the plant variety does not conform to the criteria of novelty. In other words a plant variety is registered as a “new variety” if it is novel in addition to being distinct, uniform and stable (i.e. meeting the ‘DUS’ criteria) and as an “extant variety” if the plant variety is not novel but meets the DUS criteria. In terms of Section 15(3) of the Act, a new plant variety would be deemed to be novel if the propagating or harvested material of such variety has not been sold or otherwise disposed of by or with consent of its breeder or his successor for the purposes of exploitation of such variety in India earlier than one year or in case it is disposed of outside India, earlier than four years from the date of application.
17. The crucial issue is whether sale or disposal of hybrid seeds would amount to sale or otherwise disposal of the propagating or harvested material of the parent lines and consequently destroy their novelty.
18. Before proceeding to address the controversy, it would be necessary to understand the basic process by which hybrid varieties are created. A simple model for creation of hybrid varieties would be to cross two parent varieties. Essentially, the process involves producing one parent line (A line) which is male sterile and female fertile. The pollen of the other parent line, known as the Restorer line (R line), is dusted on the stigma of A line. The resultant seed harvested from A line is a hybrid between the two parent lines, A line and R line, and its genome comprises of the genomes of the said two parent lines. The hybrid seed is sold commercially. In the strict sense the seeds are harvested from A line and not from R line.
19. The parent lines are not sold and only the seeds of the hybrid variety are sold commercially. According to the petitioner, since the parent lines are not commercially sold and their identity is kept secret, the parent lines cannot be considered as “extant variety” within the meaning of Section 2(j) of the ‘Act’.
20. A variety is defined under Section 2(za) as under:
“(za) “variety” means a plant grouping except micro organism within a single botanical taxon of the lowest known rank, which can be— (i) defined by the expression of the characteristics resulting from a given genotype of that plant grouping; (ii) distinguished from any other plant grouping by expression of at least one of the said characteristics; and (iii) considered as a unit with regard to its suitability for being propagated, which remains unchanged after such propagation, and includes propagating material of such variety, extant variety, transgenic variety, farmers’ variety and essentially derived variety;”
21. It is not in dispute that parent lines are plant varieties within the meaning of Section 2(za) of the Act and if the said varieties were found compliant with the conditions under Section 15 of the Act, they would be registerable under the Act. The only bone of contention is whether a parent line could be considered as a “new” variety on account of their hybrid being known in the market.
22. Section 2(j) of the Act defines “extant variety” and reads as under:
“(j) “extant variety” means a variety available in India which is— (i) notified under section 5 of the Seeds Act, 1966 (54 of 1966); or (ii) farmers’ variety; or (iii) a variety about which there is common knowledge; or (iv) any other variety which is in public domain;”
23. It was contended on behalf of the petitioners that the parent lines are the proprietary assets of breeders, which are kept secret and not placed in the public domain. Thus, the petitioners would not be precluded from claiming that the parent lines conform to the criteria of novelty even if the seeds of the hybrid variety are commercially sold by them.
24. According to the petitioners, the hybrid seeds are not harvested material of parent lines. The learned counsel for the petitioners contended that the seeds were propagating/harvesting material from the parent variety and not of the parent variety.
25. The expression “harvested material” has not been defined under the Act, but the expression “propagating material” has been defined under Section 2(r) of the Act and reads as under:
“(r) “propagating material” means any plant or its component or part thereof including an intended seed or seed which is capable of, or suitable for, regeneration into a plant;”
26. A plain reading of the aforesaid definition indicates that an intended seed or a seed which is capable of, or suitable for, regeneration into a plant would be a propagating material of the plant. It is the petitioners’ case that a hybrid seed does not fall within the definition of “propagating material” because a hybrid seed is incapable and unsuitable for regenerating into any of the parent line varieties. The petitioners have sought to interpret the expression “regeneration into a plant” to mean regeneration into a plant of the same variety of which the seed is a propagating material. The expression “regeneration” has been sought to be interpreted to mean regeneration of the same variety. In my view, this interpretation is not borne out by the plain language of Section 2(r) of the Act. In order to fall within the definition of the expression “propagating material” all that is required is that a seed or intended seed should be capable of, or suitable for, regeneration into a plant. The use of the article ‘a’ is material. The word “regeneration” as used in the context would mean to germinate or to grow into a plant. Thus, as long as a seed of a variety is capable of or suitable to germinate into a plant, it would fall within the definition of “propagating material”. The Registrar has also come to the conclusion that since a hybrid seed is capable of regeneration into a plant it would fall within the meaning of the expression “propagating material”. And, I do not find any infirmity with this view.
27. Strictly speaking, the seeds are harvested from one of the parent lines (i.e. the A line) however, as commonly understood, such seeds would be harvested material from the parent lines. The learned counsel for the petitioners does not dispute that the hybrid seeds are harvested material from the parent lines but has contended that harvested material from a variety would not be the same as “harvested material of a variety”. The petitioners urge that although the seeds have been harvested from the parent variety, they cannot be stated to be the harvested material of that variety. I find it difficult to appreciate this distinction in the context of Section 15(3) of the Act. A plain reading of the expression “harvested material of such variety” would include all material that has been harvested from the plant. Concededly, the seeds are harvested from the parent lines; such seeds may not propagate the parental lines, but nonetheless, are harvested materials of those lines.
28. It is settled law that the intention of the Legislature must be discerned from the plain language of a Statute. In my view, the plain language of Section 15(3)(a) of the Act indicates that a variety would be novel if harvested material of a variety has not been sold, or otherwise disposed of prior to the specified period. It would, obviously, follow that the plant would cease to conform to the novelty criteria as required for being registered as a new variety, if the propagating material/harvested material of the variety was sold or otherwise disposed of for the purposes of exploitation of such variety prior to the specified period. Although, the word ‘deemed’ is used in the opening sentence of Section 15(3) of the Act, the same cannot be read to mean that even if a plant variety does not conform to the conditions of clause (a) of Section 15(3) of the Act it could, nonetheless, be considered as novel.
29. In St. Aubyn v. Attorney-General: (1951) 2 All ER473Lord Radcliffe had held as under:
“The word ‘deemed’ is used a great deal in modern legislation. Sometimes it is used to impose for the purposes of a statute an artificial construction of a word or phrase that would not otherwise prevail. Sometimes it is used to put beyond doubt a particular construction that might otherwise be uncertain. Sometimes it is used to give a comprehensive description that includes what is obvious, what is uncertain and what is, in the ordinary sense, impossible.”
The Supreme Court in Consolidated Coffee Limited (supra) had quoted the above passage with approval and observed as under:
“A deeming provision might be made to include what is obvious or what is uncertain or to impose for the purpose of a statute an artificial construction of a word or phrase that would not otherwise prevail, but in each case it would be a question as to with what object the legislature has made such a deeming provision” The word “deemed” in the opening sentence of Section 15(3) of the Act must be read in the context of the legislative intent; a plant variety, the propagating material or harvested material of which is sold or otherwise disposed of within the specified period would be novel but would be precluded from being claimed as novel if sold/otherwise disposed of prior to the specified period.
30. The expression “exploitation of such variety” need not necessarily be by sale of the plant, or such material of that plant, which is capable of regeneration into the same variety; sale of the harvested material of varieties - in this case the hybrid seed, which would not germinate into either of the parent varieties - would, clearly, be an exploitation of those varieties. According to the petitioners, the parental lines are not sold but used only for producing seeds of hybrid varieties. Indisputably, the sale of such seeds would amount to exploitation of the parental varieties for commercial purposes.
31. The decision of the Supreme Court in Thomas Stephen & Co (supra) is of little assistance to the petitioners as the impugned order does not proceed on the basis that the petitioners have sold or otherwise disposed of the parent lines. Admittedly, the petitioners sell and dispose of hybrid seeds. Since, such seeds have been held to be propagating material/harvested material of the parent lines the parent lines cannot be deemed to be novel under Section 15(3)(a) of the Act 32. The learned counsel for the interveners has relied upon the opinions of the Administrative and Legal Committee of International Union for Protection of New Varieties of Plants (UPOV). UPOV was established by an International Convention for the protection of new varieties of plants, which was adopted on 02.12.1961 by a diplomatic conference held in Paris. The UPOV Convention came into force on 10.08.1968 having been ratified by the United Kingdom, Netherlands and Germany. 72 countries had joined UPOV as members as on 10.06.2014. Article 6(1) of the 1991 Act of the UPOV Convention contains words which are similar to Section 15(3) of the Act and reads as under:
“(1) [Criteria]. The variety shall be deemed to be new if, at the date of filing of the application for a breeder’s right, propagating or harvested material of the variety has not been sold or otherwise disposed of to others, by or with the consent of the breeder, for purposes of exploitation of the variety (i) in the territory of the Contracting Party in which the application has been filed earlier than one year before that date and (ii) in a territory other than that of the Contracting Party in which the application has been filed earlier than four years or, in the case of trees or of vines, earlier than six years before the said date.”
33. The interpretation of the aforesaid clause was considered by the Administrative and Legal Committee of UPOV at its Forty-First Session held in Geneva on 06.04.2000. The International Association of Plant Breeders for the Protection of Plant Varieties (ASSINSEL) had addressed a letter to the Secretary General of UPOV canvassing the proposition that the sale of hybrid did not destroy the novelty of its parent lines. It was contended that hybrid only represents itself and not its components or the formula that associates the hybrid. The issue whether the novelty of the parent lines was destroyed in cases where a hybrid was sold, was examined in the context of Article 6(1) of the 1991 Act and the Administrative and Legal Committee reached the following conclusion:
“The Chairman concluded that, as expressed by several member States, the basic view on this issue seemed to be that the novelty of the inbred lines was lost by the exploitation of the hybrid variety. He also stated, however, that note should be taken of the different positions expressed in the session. He considered that the Committee had exhausted its discussions and could not go further at this stage.”
34. ASSINSEL had further sought a review of this opinion and the issue was debated by the Administrative and Legal Committee of UPOV in its Forty-Third Session held in Geneva on 05.04.2001. The Vice Secretary General concluded that the Convention allowed both interpretations and in the circumstances, the Chairman of the Committee summed up the discussions by holding that it was not necessary to change the previous interpretation. In other words, the earlier opinion of UPOV that the novelty of the parent lines were lost by commercial exploitation of its hybrid was not disturbed.
35. In my view, a plain reading of Section 15(3) of the Act would indicate that if the seeds of parent lines have been commercially sold, the breeders cannot claim the parent lines to be novel. As I see it, even if one was to consider that language of Section 15(3) of the Act was ambiguous on the issue, the same would have to be resolved against the petitioners. This is so because it is well settled that in case of ambiguity in the language of a statute, a purposive interpretation that furthers the intention of the Legislature must be adopted. The Legislative intent of the Act is to protect the rights of the farmers’ and plant breeders. India had ratified the TRIPS agreement and, therefore, was obliged to protect the intellectual property rights in certain plant varieties. The protection as envisaged under the Act is to provide certain exclusive rights for a specified period of time. By virtue of Section 24(6) of the Act, the registration certificate issued in respect of a plant variety could be extended for a period up to 18 years from the date of registration in case of trees and vines and 15 years from the date of registration in other cases. In the case of extant varieties the validity of the registration certificate can be extended upto 15 years from the notification of that variety under Section 5 of the Seeds Act, 1966. In other words, the Parliament in its Legislative wisdom considered that providing exclusivity as specified under Section 24(6) of the Act was sufficient protection to the plant breeders. If the provisions of Section 15(3) of the Act are read in a manner as suggested by the petitioners, the effect would be to extend that period of protection many times over. In the first instance, a breeder would get protection in respect of the hybrid variety and assuming that there are two parent lines, the breeder could just before the expiry of the Registration Certificate in respect of a hybrid variety, register one of the parent variety and thus, extend its period of exclusivity for a further period of 15/18 years because protection of even one parent line would practically ensure exclusive rights in relation to the hybrid variety. In the same manner, before expiry of the registration period of that parent line, the breeder could register the other parent line as a new variety. In this manner a breeder could extend the protection for a period up to maximum 45/54 years instead of 15/18 years as contemplated under the Act. Clearly, this is not the legislative intent of the Parliament.
36. The above consequence of increasing the exclusive rights persuaded the UPOV to reject the ASSINSEL’s interpretation of Artcile 6(1) of the 1991 Act of the UPOV convention and to adopt the view that a sale of a hybrid destroys the novelty of the parent lines. The Delegation of the United States to UPOV had opposed ASSINSEL’s interpretation of Article 6(1) of the 1991 Act of the UPOV Convention for the reason that it would enable a breeder to extend the period of protection as afforded by that legislation. The relevant extract of the proceedings recording the stand of the USA’s Delegation reads as under:
“In his Delegation’s opinion, if an inbred was being kept secret and only the harvested material from that inbred was made available in a form of a hybrid, then it would seem rather unfair that after a number of years of exploitation, when there was a danger that that inbred may become known, the breeder should go to a plant variety protection office and obtain a further twenty or more years of protection. The protection of plant varieties should be more even-handed and, therefore, there should be no possibility of obtaining additional protection for certain varieties that were not obtainable on a routine basis. As a consequence, his Delegation had great difficulties with the proposal of the Delegation of Germany.”
37. The view canvassed by the petitioners is similar to ASSINSEL’s interpretation of Article 6(1) of the 1991 Act of the UPOV convention, which was not accepted for that would extend the protection beyond the period as provided under the 1991 Act of the UPOV convention.
38. The learned counsel for the interveners relied upon the decisions in Tata Iron & Steel Co. (supra) and Federation of Railway Officers Association (supra), in support of his contention that the opinion of the Registrar being an expert in the matters should not be interfered with. In my view, the said decisions are wholly inapplicable to the facts of the present case, as they affirm the proposition that the Courts would not normally interfere in the matters affecting policy, which are within the discretion of the relevant authority. The present cases relate to interpretation of a statute and not of any discretionary policy.
39. However, it is well established that the Courts would take into account that the concerned authorities have knowledge, expertise and experience in the particular subject and would not necessarily supplant their view over that of the concerned authorities in technical matters.
40. In view of the above, I find no reasons to interfere with the impugned order. Accordingly, the petitions are dismissed. No order as to costs. VIBHU BAKHRU, J JANUARY09 2015 RK