Void clause of plant varieties statute resurrected

By Manisha Singh and Neha Ruhela, LexOrbis
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Section 24(5) of the Protection of Plant Varieties and Farmers’ Rights Act, 2001 (act), has long been contentious in intellectual property law. Even before a plant variety has been registered, the section enables an applicant to seek injunctive relief and damages against any abusive act committed by a third party. In Prabhat Agri Biotech v Registrar of Plant Varieties, a division bench of Delhi High Court held this provision to be ultra vires because it conferred untrammelled power on the registrar, a situation open to misuse. Later, this decision was stayed by the Supreme Court in Pioneer Overseas Corp v Kaveri Seed Co Ltd. Recently, a single judge of Delhi High Court in UPL Limited v Registrar and Anr analysed the ramifications of the Supreme Court’s stay order, concluding that section 24(5) was not excised from the statute.

Manisha Singh, Founder Partner at LexOrbis in New Delhi
Manisha Singh
Partner
LexOrbis

Having applied for registration of hybrid Raadhika Okra varieties, the appellant, in its application under section 24(5) claimed that the second respondent, by commercialising Bindu varieties was abusing its commercial interest. The appellant sought relief from the registrar of the PPVFR Authority, the first respondent. The registrar dismissed the appellant’s application on the grounds that an application under section 24(5) could be maintained only after the grant of a plant variety registration and not while the application for registration was being considered.

The court analysed the registrar’s decision. On a plain construction of the provision, the court held that section 24(5) explicitly gave the registrar power to issue directions between the application for registration and the final decision. The registrar also admitted that its decision was wrong in principle. The court held that the order of the registrar was contrary to the statute.

Neha Ruhela
Neha Ruhela
Senior associate
LexOrbis

The court then turned to the central issue of whether the Supreme Court’s stay in Pioneer Overseas nullified the effect of the appellate high court’s holding that section 24(5) was ultra vires. Citing various authorities dealing with the legal effect of a stay, the second respondent argued that the Supreme Court’s stay merely suspended the execution or enforcement of the decision without dismissing its findings. The respondent contended that section 24(5) continued to be unconstitutional and therefore without legal effect. The court was not persuaded; on the contrary, it emphasised that the distinction between a dispute involving individual parties and one raising questions of wider legal or constitutional significance was a significant factor in analysing the implications of any stay.

In the present case, the court quoted the division bench in Prabhat Agri Biotech, which specifically addressed the constitutional validity of the provision. That bench had ruled that the danger of long-term harm to participants in the agribusiness of developing hybrids and plant varieties far outweighed the benefits of section 24(5), in view of the unguided nature of the power it conferred. That bench therefore declared the section void because it contravened article 14 of the Indian Constitution.

The court in the present case found that this precise determination of the unconstitutionality of section 24(5) had been put on hold by the Supreme Court’s interim stay order without condition or limitation. That showed the Supreme Court’s intention to suspend the effect and operation of the division bench’s declaration of unconstitutionality. The court held that the declaration that section 24(5) as ultra vires did not remove the provision’s existence and was no longer binding because the Supreme Court had stayed it. In consequence, the court set aside the registrar’s order, restored the appellant’s application under section 24(5) and directed the registrar to decide it on its merits.

The court cautioned against a one-size-fits-all approach to the effects of a stay. Each order must be considered on its merits, taking into account its unique facts and legal issues. In the present dispute, the single judge held that the Supreme Court’s interim order was a temporary stay of the division bench’s declaration. This ruling maintained the status quo of section 24(5) until the Supreme Court delivered a final judgment. The court, in its deft handling of the issue not only revived the enforceability of section 24(5) of the act but also reopened the debate surrounding it.

Manisha Singh is a partner and Neha Ruhela is a senior associate at LexOrbis

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