Sokkalal Ram Sait v. Nadar.
1939Present: Wij eyewardene and NihiO JJ.
SOKKALAL RAM SAIT v. NADAR et al.
116—D. C. (Inty.) Colombo, 6J38.
Privy Council—Conditional leave to appeal-Value of subject-matter indispute—Amount of costs cannot be added to value—Under-valuation toevade stamp duty—The Appeals (Privy Council) Ordinance. No. 31 of1909, Rule 1 (a), Cap. 8S.
The costs which an unsuccessful party is ordered to pay by the SupremeCourt cannot be reckoned in valuing the- matter in dispute for thepurpose of Rule 1 (a) of the Privy Council Appeal 'Rules.
Where the subject-matter of an action is deliberately under-valued forthe purpose of evading the stamp duty the party will not be permittedto give a different valuation to bring himself within the Rule.de Alwis v. Appuhamy (30 N. L. R. 421) applied,
HE applicant sued the respondents, asking for an injunctionrestraining them from infringing his trade marks and from passing
off goods not of the applicant as and for goods of the applicant; for anaccount of the profits and for delivery of all the beedie (cigars) in therespondents’ possession. Jhe applicant valued the subject-matter of theaction at Rs. 1,000.
The District Judge gave judgment granting an injunction to theapplicant and ordering the respondents to deliver the beedies in theirpossession.
In appeal, the Supreme Court set aside the judgment of the DistrictJudge and entered decree, dismissing the applicant’s action with costs,directing the Registrar of Trade Maries to proceed with the application.for registration of respondents’ trade marks and granting Rs. 300 asdamages.
The applicant applied for conditional leave to appeal to the PrivyCouncil.
N.E. Weerasooria, K.C. (with him iV. Nadarajah and K. S. Aiyar),for applicant.—The value of the matter in dispute is directly orindirectly more than Rs. 5,000. Our reasons for saying so are setout in our affidavit. It is true that, originally, the subject-matter of theaction was valued at Rs. 1,000, but that valuation was made bona fidefor purposes of stamping, in accordance with the provisions of section 48of the Trade Marks Ordinance (Chapter 121), and does not representthe true value.' The value of the action is, in reality, much more andcan be taken into account on the present occasion. (Baboo Roy v. K. Singhet al Hollandia Anglo-Dutch Milk & Food Co. v. Anglo-Swiss CondensedMilk Co.’).
Damages should be included in computing the value of an action(Maitripalo v. Koys *).
Rule 1 (a) of the schedule to the Appeals (Privy Council) Ordinance(Chapter 85) speaks of “the matter in dispute on the appeal”. Thisbeing so, the costs which we have to pay under the Supreme Court decree
» (187$) L. ft. 1 Indian Appeals 317.* (1923) 5 C. L. Bee. 15.
» (1939) 14 C. L. W. 112.
WIJEYEWARDENE J.—Sokkalal Ram Sait v. Nadar.
and which has been taxed at over Rs. 9,000 should be included. On thisshort point the present application can be decided. It is possible thatthe Privy Council may delete the order for costs.
H. V. Perera, K.C. (with him N. K. Choksy and C. C. Rasa Ratnam), fordefendants, respondents.—Costs cannot and should not be taken intoaccount (Chowdry v. Chowdry *; Doss v. Doss et al.'). Apart from thesetwo cases, the wording of Rule 1 (a) refers to “ property or civil right ”.The words “ matter in dispute on the appeal ” refer to the substantivematter in dispute, and the question of costs is merely incidental. Theorder for costs cannot be said to relate to'any property or civil right.Costs of the suit are no part of the matter in dispute (Bentwick on PrivyCouncil Practice (1926 ed.), p. 144).
The subject-matter of the suit was valued at Rs. 1,000 in the plaint.That valuation cannot be changed at this stage (Appuhamy v. Corea’;Sathasiva Kurukkal v. Subramaniam Kurukkal *; de Alwis v. Appuhamy *;'Ahamadu Lebbe et al. v. Abdul Cader et al. °).
W. E. Weerasooria, K.C., in reply.—de Alwis v. Appuhamy (supra) isauthority for the proposition that the question of the true value of thesubject-matter in dispute can be considered now.
In regard to the inclusion of the costs, “ the subject-matter in dispute ”is mentioned in Chowdry v. Chowdry (supra), whereas our rule speaksof “ the matter in dispute on the appeal ”.
The passages in Bentwick on Privy Council Practice, p. 144, can haveno application to legislation such as we have here on the subject.
Cur. adv. vult.
September 22, 1939. Wijeyewardene J.—
This is an application for conditional leave to appeal to the PrivyCouncil and, in view of the objections raised by the respondents, it isnecessary to give a brief summary of some of the preliminary facts.
The appellant sued the respondents in the District Court of Colomboand asked for judgment against the respondents for—
(i.) an injunction restraining the respondents (a) from infringing histrade marks Nos. 4,919 and Nos. 5,929 and (b) from passing offgoods not of the appellant’s manufacture as and for the goodsof the appellant.
(ii.) an account of the profits wrongfully made by the respondents.
(iii.) delivery to the appellant of all beedies in the respondents’possession marked with certain devices.
The appellant valued the subject-matter of the action at Rs. 1,000.
The'appellant also made an application along with the plaint for aninterim injunction. This injunction was granted by the District Judgebut, after a short interval of time, the parties agreed to the suspensionof the injunction pending the trial.
The respondents filed answer contesting the claim of the appellant andMaiming a sum of Rs. 10,000 as damages sustained by them in conse-quence of the interim injunction. At a later stage the respondents
(1560) 6 Moore's Indian. Appeal Cases 262.4 (192$)31N.L.R.165.
(1869) 13 Moore's Indian Appeal Cases 85.5 (1929)30N.L.R.421.
2 (1900) 1 Browne's Rep. 165.9 (1931)33N.L.R.337.
WIJEYEWARDENE J.—Sokkalal Ram Sait v. Nadar.
amended the prayer of their answer by asking that in addition to therelief already asked, they should be declared entitled to have theirtrade marks No. 6,778, No. 6,779, and No. 6,780 registered in the registerof Trade Marks in spite of the opposition of the appellant.
During the pendency of the trial in the District Court the appellantmade an additional claim for Rs. 10,000 as damages sustained by himby reason of the respondents passing off goods not of his manufactureas his goods, as set out in paragraph 14 of the plaint.
The District Judge gave judgment granting an injunction to theappellant and ordering the respondents to deliver to the appellant beediesin their possession bearing certain labels. The appellant was howeverrefused any damages.
The respondents appealed against the judgment of the District Judge,while the appellant failed to appeal' or file cross objections in appealagainst that part of the judgment which dismissed his claim for damages-.
In appeal the Supreme Court set aside the judgment of the DistrictCourt and ordered decree to be entered,
dismissing the appellant’s action with costs of the District Court
and costs of appeal.
directing the Registrar of Trade Marks to proceed with the appli-
cation for the registration of trade marks 6,778, 6,779, and6,780 in spite of the opposition of the appellant.
granting Rs. 300 as damages to the respondents.
The present application is for conditional leave to appeal against thedecree of the Supreme Court. The respondents contend that no appeallies to the Privy Council as the value of the matter in dispute is less thanRs. 5,000 and as no question of great general or public importance isinvolved in the appeal.
It was not seriously urged on behalf of the appellant that he wasentitled to appeal under rule 1 (b) of the Rules in the Schedule to theAppeals (Privy Council) Ordinance. This is an action between tworival traders of beedi (cigars) and the points for adjudication depend largelyon questions of fact as to the period during which the rival trade markshad been used. No question of general or public importance arises fordetermination in the case and I hold that the appellant is not entitledto appeal under rule 1 (b).
The appellant has filed an affidavit in support of his plea that “ thematter in dispute on the appeal ” to the. Privy Council exceeds the value ofRs. 5,000. The reasons set out in the affidavit and adopted by counselin his argument before us may be briefly summarized as follows : —
The action was valued at Rs. 1,000 in the plaint “ as the stamp
duty payable in respect of proceedings under the Trade MarksOrdinance is the minimum chargeable in the District Court inCivil Proceedings and fall under class 1 up to and includingRs. 1,000 ”.
The value of the appellant’s trade marks and the loss of profit
consequential on the refusal of an injunction to the applicantis Rs. 10,000.i
The loss that would accrue to the appellant as a result of the
setting aside of the judgment of the District Judge in regard
556W1JEYEWARDENE J.—Sokkalal Ram Sait v. Nadar.
to the delivery to the appellant of the beedies in respondents'possession amounts to Rs. 10,000.
The loss of profit which would accrue to the appellant in view of
the direction given by the Supreme Court decree to the Registrarof Trade Marks to register marks Nos. 6,778, 6,779, and 6,780is Rs. 15,000.
The taxable costs payable by the appellant under the decree of the
Supreme Court would exceed Rs. 6,000 and should be regardedas a portion of the “ matter in dispute on the appealThe first contention is. clearly untenable. Section 49 of the TradeMarks Ordinance (Legislative Enactments, Volume III., Chapter 121)enacts that “ Every judgment or order by the District Court under thisOrdinance should be subject to an appeal to the Supreme Court ….and the minimum duties chargeable in the Supreme Court under theprovisions of the Ordinance for the time being in force relating to stampsshall, so far as the same may be applicable, be charged in all proceedingsrelating to or in connection with such appeal ”. That section thereforerefers to stamp duties chargeable in the Supreme Court and the lowestclass in the Stamp Ordinance (vide Legislative Enactments, Vol. IV.,Chapter 189) with regard to proceedings, in the Supreme Court is class 1which includes claims up to and including Rs. 500. The appellant shouldtherefore have valued his claim at Rs. 500 and not Rs. 1,000 if thevaluation in the plaint was inserted merely in view of the provisions ofsection 49 of the Trade Marks Ordinance. It is difficult to believe thatthe lawyer who drafted the plaint would have thought that the actionwas an action to which section 49 of the Trade Marks Ordinance applied.This action was partly a “passing off” action and therefore was notan action under the Ordinance (vide section 44 of the Trade MarksOrdinance). Moreover if the lawyers made the mistake of thinkingthat it was an action to which section 49 was applicable there was noreason why the subject-matter of the action should have been valuedas the amount of the stamp duty would have been determined by thenature of the claim. I have no hesitation in rejecting this explanationfor the valuation of the subject-matter of the action at Rs. 1,000. Ihold that the valuation was intended to be regarded as a correct andbona fide valuation of the claim.
It is convenient to discuss the second and third points together. Theappellant valued the subject-matter of the action at' Rs. 1,000 in theplaint. The subject-matter of the action is indicated clearly in the prayerof the plaint, which refers to. an injunction, the taking of accounts inrespect of profits made by the respondents, and an order for deliveryof beedies. This shows that at the time of filing the plaint the appellantvalued at Rs. 1,000 what he now seeks to value in the aggregate sumof Rs. 20,000. As stated by me earlier, the explanation offered by theappellant for yaluing the subject-matter at Rs. 1,000 cannot be accepted.The affidavit moreover makes a bare statement .that the real value isRs. 20,000 and does not give the grounds on which the valuation is made.There is no doubt that it is in the interest of the. appellant to state nowthat the value of the subject-matter is Rs. 20,000 in order to supporthis- application for leave to appeal to the Privy Council.
WUEYEWARDENE J.—Sokkalal Ram Sait v, Nadar.557
It has not been suggested by the appellant that the claim had increasedin value between the date of the plaint and .the date of appeal. If thevalue given in the plaint is in fact an underestimate, it appears to methat the undervaluation was made deliberately for the purpose of avoidingpayment of heavy stamp duty and thus evading the revenue laws of theIsland. In these circumstances I am unable to accept and act upon thevalue now sought to be placed on the matter in dispute (vide Appuhamy v.Corea (supra), de Alwis v. Appuhamy (supra) ).
I shall now deal with the fourth point raised by the appellant’s counsel.The direction given to the Registrar of Trade Marks to proceed with theapplication of the respondents’ trade marks in spite of the appellant’sopposition, cannot in my opinion be given a separate and distinctvaluation apart from the claim of the appellant. The claim of theappellant, if successful, would have automatically prevented the res-pondents from obtaining the registration of those particular trade marks.The dismissal of the appellant’s action by the Supreme Court was on theground that the respondents had a prior or at least an honest concurrentuser of those particular trade marks. This necessarily involved a findingthat the plaintiffs could not oppose the application of the respondentsfor the registration of those trade marks. The order of the SupremeCourt did not state that the respondents were entitled to get their trademarks registered against all opposition but only that the respondents’application should be considered by the Registrar ignoring the oppositionof the appellant whose claim haS been found to be groundless by theSupreme Court. I hold that the direction given to the Registrar was anatural and logical sequel to the order dismissing the plaintiff’s claim.Moreover, the value placed on this part of the decree of the SupremeCourt in the appellant’s affidavit seems to me to be highly exaggeratedin view of the fact that the whole claim of the appellant was valued atRs. 1,000.
The last point urged by the appellant’s counsel is that the costs payableby the appellant under the Supreme Court decree should be regarded as apart of “ the matter in dispute on the appeal ”. This argument hascertainly the merit of novelty as a similar argument does not appear tohave been addressed to this court in any previous case. The learnedcounsel argues that in appealing to the Privy Council the appellant isseeking to obtain relief against the decree of the Supreme Court dis-missing his claim and ordering him to pay the respondent’s costs. Theliability to pay costs should therefore, he states, be regarded as a partof the matter in dispute; There is no doubt that the appellant isaggrieved in having to pay a large sum of money as costs in addition tohaving his claim dismissed. But do facts constituting a grievancenecessarily constitute a matter in dispute within the meaning of rule 1 (a) ?The dismissal of the appellant’s claim necessarily resulted in the appellantbecoming liable to pay costs to the respondents. If the appellant succeedsin his appeal to the Privy Council and gets the decree of this Courtdismissing this action vacated, the appellant will not only be relievedfrom the necessity of paying the costs of the respondents but will also bedeclared entitled to an order for costs against the respondents. If thecontention Of the appellant’s counsel is sound, it may even be argued thatin order to ascertain the value of the matter in dispute the value of the
Smith v. Fernando.
plaintiff’s claim should be enhanced by double the amount of costs he isnow ordered to pay. But I do not think that the language of rule 1 (a)forces us to such a position. If the amount of costs should be reckonedas forming a part of “ the matter in dispute ” mentioned in the earlierpart of Rule 1 (a) it must also be reckoned in the case of appeals mentionedin the latter part of the rule as appeals involving “ directly or indirectlysome claim or question to or respecting property or some civil rightamounting to or of the value of five thousand rupees or upwards”.It is difficult to see how an order on an unsuccessful party to pay costscould be regarded as forming part of “ a claim or question to or respectingproperty or some civil right”. If the costs payable by an unsuccessfulparty cannot be considered in the case of appeals falling under the secondportion of Rule1 (a) it is difficult to hold that such costs should be regardedas forming part of a matter in dispute mentioned in the earlier part ofthe Rule. There may no doubt be cases where the order to pay costsmay be itself give a right of appeal to the Privy Council'. In the presentcase however the order to pay costs is subsidiary to the order dismissingthe appellant’s claim and ordering him to pay Rs. 300 as damages.
In Doorga Doss Chowdry v. Rama Nanth Chow dry1 the Privy Councilheld that costs, of suit should not be added to the principal sum andinterest tq arrive at the value of the claim for the purposes of an appealto the Privy Council. That decision was given on an interpretation of.the order in Council of April 10, 1838, which is not available to me.Mulla in his Commentary on the Indian Code of Civil Procedure (8th ed.)states at page 294 that the Order in Council referred to “the amountor value of the subjefct-matter in dispute in appeal to Her Majesty inCouncil ”. If the statement of Mulla is correct, then the decision of thePrivy Council is an authority in support of the view I have expressed.
I would dismiss the appellant’s application with costs.
NmiLL J.—I agree.Application refused.
SOKKALAL RAM SAIT v. NADAR et al