Injunctive Relief And Standard Essential Patents :

A Critical Comparative Analysis

(By Achyuth B. Nandan, LL.M. Student, Rajiv Gandhi School Intellectual Property Law, IIT Kharagpur)

E-mail : achyuthbnandan@gmail.com               Mob. 9072653887

INTRODUCTION

Standard essential patents refer to those patents that claim an invention which is used as a technical standard. The standard-setting organizations (SSOs) determine whether a patent is essential for achieving standard technology, with mutual consensus among the industry players which will benefit the target customers. To neutralize the uneven bargaining power of the patent holders and the buyers, licenses to procure and use SEP are subject to Fair, Reasonable and Non-Discriminatory (FRAND) terms. It is to be noted that this is a voluntary contractual obligation which the SEP holder abide to and not a statutory undertaking.  It is often observed in Standard Essential Patent (SEP) jurisprudence that the SEP holders tend to seek injunctive relief against the potential licensees. They try to establish skepticism against other manufactures before the court, questioning their merit and willingness in abiding to the FRAND licensing terms. The rationale is to prevent the misuse of the SEP by the infringer. However, in reality, this often led to problems like abuse of dominant position by the SEP holder and Patent holdup. This is a complex terrain and the courts have to meticulously apply its judicial mind as it involves striking a balance between incentivization for innovation and fair competition. India has been pro-active in granting injunction that too ex parte many of the times for patent infringement claims. The United States of America and European Union has aligning approach with regard to granting of injunctive relief to the SEP holders.

BACKGROUND

There is a differential bargaining power involved in the SEP licenses. The SEP holders at times try to abuse its dominant position to avoid the FRAND commitments by filing frivolous injunction petitions.[i] Licensees in such situations are forced to pay higher royalties leading to ‘Patent Hold up’, which in turn leads to an anti-competitive environment. The courts therefore, have reduced granting of injunctive relief keeping in mind the negative implications. As a general rule injunction can be granted against the licensees only if there is non-payment of FRAND royalty.  Injunction relief cannot be blatantly barred as the infringers can refuse to pay the royalties with no harm. Ultimately, all the implementers in the market must have access to standard patented technology.

INDIAN POSITION

The relationship between Intellectual Property Rights and Competition law are often construed as contradictory, this adds more tension to the SEP jurisprudence in the Indian context. For instance, in the cases Vringo v. Xu Dejun[ii] and Micromax v. Ericsson[iii], the Delhi High Court overlooked the anti-competitive effects and granted ex parte injunction giving weightage to Intellectual Property Rights. In both the cases the activities of the SEP holders were prima facie contrary to FRAND terms. It is pertinent to note that as per Section 3(5) of the Competition Act, 2002, elucidates the protection of Intellectual Property Rights subject to reasonable conditions. Whereas Section 4(2) of the Act provides that imposition of discriminatory and unfair conditions in sale or buying of goods or services constituted abuse of dominant position.  Licensees have approached CCI to acknowledge the issue of ‘abuse of dominance’ and in 2013 CCI observed that Ericssons conduct primarily constitutes abuse of power in the market based on the patent holdup scenario. Later on, a Writ Petition was filed by Ericsson claiming that the CCI lacks jurisdiction to inquire into unsuccessful negotiations relating to Section 26 of the Competition Act 2002[iv], but no adjudication has been made in the High Court in this matter.

The conduct of the parties in SEP litigations proves to be vital, as the balance of convenience is ascertained mostly by the conduct of the SEP holder and the infringer as it’s an equitable remedy. In Ericsson v. Intex[v], the Delhi High Court granted injunctive relief in favour of Ericsson, as it observed that the court is obliged to grant injunction against misuse of patent if the SEP holderhas approached the court without undue delay, provided it’s a valid patent. Intex was observed to be an “unwilling licensee” in this case as royalty is not paid and FRAND agreement was not concluded and this can potentially harm other licensees which are market giants paying royalties. The litigative nature of the SEP holder to gain permanent injunction is viewed as an abuse of dominant position.  In a 2022 decision made in Nokia v Oppo[vi] the Delhi HC, highlighted the peculiar nature of SEPs observing that third party usage of the patents will not as such enable the patent holder to seek injunctive relief similar to normal patents. Public interest was considered as an inseparable element in SEP access and usage.  SEP holder cannot be treated as bona fide licensor if the core intention is to receive exorbitant royalty deviating from FRAND terms. Indian courts even though known for granting injunction proactively, have mostly tried to balance the rights of patent holders and implementers.

INTERNATIONAL POSITION

A. EUROPEAN UNION

The EU is reluctant in granting injunctive relief, as it considers it as primarily incompatible with FRAND ideals.  Courts in Europe have acknowledged the importance of injunctions in safeguarding IP rights, but they give weightage to anti-trust law framework in this regard. This is primarily because SEP holder have ‘voluntarily’ concluded FRAND license. A landmark decision in this realm was made in Huawei v. ZTE[vii] the court focused on balancing IP rights of the SEP holder without amounting to abuse of dominant position[viii] (Article 102 TFEU). The court held that it categorically amounts to abuse of dominant position when the patent holder seeks injunctive relief, while the licensee is willing to abide the FRAND licensing terms. Injunctive relief is granted only when the infringers conduct is dilatory/unwilling per se or injunction relief doesn’t amount to abuse of dominant position. It is coherent to note that licensee’s challenging the validity of patent doesn’t make them “unwilling licensees”, permitting such challenge will not detrimentally affect the patent holders rather it will help them to secure their right and pursue credible injunction remedies. On the other hand, the licensee can raise the anti-competitive conduct of the SEP holder as valid defence.

B. UNITED STATES

The early judicial decisions in the US indicate that injunctive relief is an inappropriate remedy for SEP infringement as its contrary with the FRAND licensing terms. US courts have always taken a pro-competitive approach. They rarely allow injunction pertaining to SEP’s.  The U.S. Supreme Court had laid down the four factors while granting equitable injunction in the case eBay Inc. v. Merc Exchange.[ix]  In Apple v. Motorola[x], the court observed that its arduous for the patentee to prove irreparable harm. It was held that if an infringer unduly delays licensing negotiations or blatantly refuses FRAND royalty, then injunctive relief would be granted.  Paramount importance is given to ‘public interest’ in the US SEP jural realm and it prevents SEP from being overvalued. The US Federal Trade Commission plays a pro-active role in taking corrective steps to curb anti-competitive conducts of the SEP holders and supervise the compliance of FRAND licence.

In Ericsson v. D-Link[xi]the court observed that over valuation of SEP leading to patent holdup shall be proved with cogent evidence and facts and not based on probabilities. It is pertinent to note that challenging the validity or essentiality of the patent does not amount to refusal to comply with FRAND terms. Also, in Microsoft v. Motorola[xii], it was observed that seeking injunctive relief cannot be construed as indicative of mala fide either.

CONCLUSION

The judicial trends and insights from most of the jurisdictions manifest the basic hypothesis that seeking injunctive relief in SEP adjudication is mostly not entertained when the alleged infringer is a willing licensee under the FRAND terms. Granting an injunction in such situations shall amount to violation of competition laws. Countries like Germany, Japan and China have also acknowledged the competing interests and issue of abuse of dominant position in FRAND negotiations under SEP framework and has limited granting injunctions while keeping a check on fair royalty rates. India being a developing country focused on materialising technology transfer and capacity building should take a more nuanced and meticulous approach in granting injunctions. Limiting the jurisdiction of CCI is also not a healthy trend.  The EU and US approach is more of a fair stance taking into consideration the patentees right and licensee’s willingness to abide by the FRAND terms. India should also consider the basic leniency towards the licensors in FRAND negotiations and focus on fair and equitable access to standard technology.  Conduct of the parties and public interest plays a pivotal role in SEP jurisprudence relating to injunctive relief.  Enforcing IP rights by the patent holder should not lead to anti-competitive scenario. Injunctive relief should be granted meagrely. If the licensee delays the negotiations or does not pay FRAND royalties then injunction may be granted. Hence, India should adopt a more pro-competitive approach while safeguarding the IP rights of the patent holder.

Foot Note:

i. Justice RRK Trivedi, Law of Injunctions, 1 Institutes Journal 21 (1996).

ii. Vringo Infrastructure Inc. & Anr. v. Indiamart Intermesh Ltd. & Ors., CS(OS) No.2168/2013, Delhi High Court (Aug. 5, 2014)

iii. Micromax Informatics Ltd. v. Telefonaktiebolaget LM Ericsson, RFA(OS)(COMM) 6/2016, Delhi High Court (Dec. 4, 2017).

iv. The Competition Act, 2002, No.12, Acts of Parliament, 2003 (India)

v. Telefonaktiebolaget LM Ericsson v. Intex Technologies (India) Ltd., 2015 (3) KLT OnLine 1154 (Del.) = CS (OS)

No.1045/2014, Delhi High Court (Mar.13, 2015).

vi. Nokia Technologies Oy v. Guangdong Oppo Mobile, CS(COMM) 299/2022, Delhi High Court (Nov.17, 2022).

vii. Huawei Technologies Co. Ltd. v. ZTE Corp., Case C-170/13, ECLI:EU:C:2015:477, 2015 E.C.R. 477 (July 16, 2015)

viii. Consolidated Version of the Treaty on the Functioning of the European Union Art.102, May 9, 2008, 2008 O.J. (C 115) 89.

ix. eBay Inc. v. Merc Exchange, L.L.C., 547 U.S. 388 (2006)

x. Apple Inc. v. Motorola, Inc., Nos. 2012–1548, 2012–1549 (Fed. Cir. Apr. 25, 2014).

xi. Ericsson, Inc. v. D-Link Systems, Inc., Nos. 2013–1625, 2013–1631, 2013–1632, 2013–1633 (Fed. Cir. Dec. 4, 2014)

xii. Microsoft Corp. v. Motorola, Inc., No. C10-1823JLR, 2013 U.S. Dist. LEXIS 54507 (W.D.Wash. Apr. 25, 2013).

Bonafidely Boneless

(By Sreejith Cherote, Advocate, High Court of Kerala)

E-mail : sreejithcherote@gmail.com                                  Mob. 9349110721

“Nn¡³ _ncnbmWnbn Nn¡³ ഉണ്ടെന്ന്IcpXn ssSKÀ _man ssSKÀ ഉണ്ടാhWsa¶nÔ. This seems to be a bonehead dialogue from an offbeat movie, but when compared to the decision in Berkheimer v. REKM L.L.C.[1], of Supreme Court for the State of Ohia, United States of America, this dialogue assumes relevance for being misjudged as a jabberwocky. It’s quite inquisitive to see, that legal reasoning may, at times, appear quite illogical to the legal vouge and rebellious to common sense. Even in the background of universal legal and statutory mandate that labeling should confirm with the content, a “U” turn has been taken by a Supreme Court in a “so-called” civilized country, in its legal reasoning that, label declaration cannot at all times vouch verbatim to the contents. Though it all happened in thousands of kilometres away in a different legal plane, it is significant for its legal principal on a tortious liability, which has a universal application. Considering the fact that law of tort has mainly evolved in India through the principles of law enunciated from judicial pronouncements, most of them delivered abroad as in the case of Donohue v. Stevenson[2].

Michael Berkheimer went to a restaurant in, Southwest Ohio, United States and ordered boneless chicken wings. The menu of the restaurant did not have a disclaimer stating that boneless chicken wings may contain bones. While eating the third piece of boneless wings, a bone with a size of 5 cm went into his wind pipe and damaged it. Later, he developed severe fever and had to be hospitalized, from where it was diagnosed that the bone had injured his esophagus and caused infection. He had to undergo several surgeries and numerous days of hospitalization to remove the bone and to arrest the infection which has reached up to his vital organs.

He sued the restaurant for negligence, after multiple rounds of litigation, at lower level, the matter came up before the Ohio Supreme Court, which in a divided decision of majority 4 to 3, gave a ruling that “boneless chicken can have bones”. Court further held that bones are natural to meat, so consumer should expect them, and boneless wings are a cooking style and no reasonable consumer would think that boneless chicken wings might not have bones in them, especially when bones are part of the chicken and no one can be held liable when boneless wings have bones. A strange analogy has been drawn by the court to explain the logic to the effect that, while eating “chicken fingers”, nobody expects and thinks that they are actually eating fingers” (much like the movie dialogue referred above).

Court had applied the ALLEN TEST[3] (Allen v. Grafton) in determining whether there is any negligence on the part of the restaurant. The crucial point to be considered in Allen test are twofold “foreign-natural[4]” and “reasonable expectation[5]” tests to arrive at a conclusion whether there is negligence or breach in the duty to take care. The question is whether the foreign body found in the food item was alien to the food, whether the harmful substance was foreign to the food or natural and whether the customer could have reasonably guard against it. Court found that bone was natural and large in comparison to the piece of chicken and any reasonable consumer should have been able to find it. The court further observed that “A diner reading “boneless wings” on a menu would no more believe that the restaurant was warranting the absence of bones in the items than believe that the items were made from chicken wings, just as a person eating “chicken fingers” would know that he had not been served fingers. The food item’s label on the menu described a cooking style; it was not a guarantee[6]”.

The case has led widespread criticism regarding the reasoning adopted by the court and a U.S. Senator[7] has described the Judgment as insane and had later introduced a legislation to overcome the effect of this decision[8].

It seems in the judgment; legal reasoning had prevailed over common sense in the conclusion drawn by the majority of the Judges. It is a legal requirement and common understanding that the labeling of the product should confirm with the contents. If there is a trade name for the product reflecting its identity as a particular thing, it’s the requirement of law that, the contents should show justice to the declaration. If there is a negative announcement on the product that something is singularly absent in it and when it is marketed highlighting the absence of something and a customer purchases the same believing the same, court seems not justified in introducing a reasoning at a hyper technical level and concluding that the label of a product should be judged with reference to the nature of the product and not as per its the commercial labelling.

The inference drawn by the court does not seem to be sound logic. Commercial labelling in itself is a class of requirement, a criterion in which certain standards has to be has been set. The very purpose of labelling is to bring accountability imbibing the concept of “duty to care” and fixing accountability and liability by prescribing uniform standards, including labelling, violation of the same attracts penal consequence to commend obedience. If the above logic is applied how can one complaint about the presence of sugar in “sugar free” sweetener or the presence of Gluten in “Gluten free” food supplements.

Now if we are to judge each product based on its nature, devoid of the prevailing practice in the commercial labelling of FMCG[9] product, it will open a unfair leverage for the manufacturers/sellers opening a plethora of defenses against, any actionable claims regarding their negligence or failure in duty to care. In India there are specific positive legislations, like Food Safety Act, package commodities rules etc., to insist that the label declaration should match the content. Here it is the requirement of law that the label must not contain information about the food that could be deemed false, misleading, deceptive, or otherwise create an erroneous impression regarding the product and also the requirement that name of the item should be mentioned along with the trade name, description, list of ingredients, in descending order of their composition by weight or volume. Seen from the Indian legal perspective, in view of the statutory mandate here, regarding product quality there seems no confusion in fixing liability generally, but there are certain grey areas of personal torts where we still rely on the ratio of foreign judgments and the ratio in Berkheimer v. REKM L.L.C. is sure to create an anomaly.

In the opinion of the author, when a food product is specifically marketed in a specific name with reference to the absence or presence of an ingredient, it is the duty of the manufacture to assure to the customers that the specified product doesn’t contain such an ingredient and if any injury is caused to a customer due to the presence or absence of that particular ingredient, there is failure of duty to care by the manufacturer. At all necessary times courts are proactive and act extensively intellectual, stretching logic to the possible extent to undo an injustice, but in certain cases same upbeat is exhibited for wrong reason and by erroneous conclusions, contradicting our expectation which is as shocking as choking on a bulky bone from a boneless meat.

Foot Note:

1.  Berkheimer v. REKM L.L.C., Slip Opinion No. 2024-Ohio-2787

2.  Donoghue v. Stevenson (1932) AC 562“snail in the ginger bottle case” streamlined the law of negligence

3.  Allen v. Grafton, 170 Ohio St. 249, 251 (1960) court propounded reasonable-expectation test referred to as the “foreign natural test” test which looks to whether the injurious substance found in the food was foreign to or natural to the food.

4.  “Foreign natural test” wherein court examines, whether the injurious substance is foreign to the particular item, for arriving at conclusion regarding negligence of a party Allen v. Grafton, 170 Ohio St. 249, 251 (1960).

5.  Reasonable Expectation Test” if the substance is within a consumer’s reasonable expectation of what might be present in the food—the supplier could not be said to have violated its duty of care. Allen v. Grafton, 170 Ohio St. 249, 251 (1960).

6.  Para 23-page 10 Berkheimer v. REKM L.L.C., Slip Opinion No. 2024-Ohio-2787.

7.  US Senator Bill DeMora (D-Columbus).

8.  Ohio Capital Journal July 29 ,2024.

9.  FMCG-Fast moving consumer goods.

Statutory Interpretation:
Distinguishing Mandatory from Directory Provisions

(By Muhammed Farooque K.T., Advocate, Tirur)

E-mail : farooque.kt@gmail.com    Mob. 7012473900

Justice Felix Frankfurter, a proponent of judicial self-restraint, offered a threefold counsel to lawyers and law enforcers when interpreting statutes:

                                          “1. Read the statute.

                                          2. Read the statute.

                                          3. Read the statute.”

He also asserted that Judges should adhere strictly to precedent, setting aside personal opinions, and decide only on “whether legislators could in reason have enacted such a law.”

Another eminent figure in legal interpretation, Justice Oliver Wendell Holmes, advised:

“It is sometimes more important to emphasize the obvious than to elucidate the obscure.”

Justice Holmes and Frankfurter collectively urge a thorough and holistic reading of statutes to discern their intent, purpose, object, and overarching design.

To distinguish between mandatory and directory provisions, it is crucial to delve into the doctrine of cy-pres. This legal principle aids in interpreting statutes and has its roots in the Norman French expression ‘cy pres comme possible,’ which translates to ‘as near as possible.’ Cy-pres is predominantly applied in civil cases, allowing courts to modify the terms of a charitable trust or will when the original purpose becomes impractical, impossible, or illegal to achieve. In essence, cy-pres encourages us to interpret statutes in a way that achieves their intended purpose, even if the literal wording isn’t strictly followed. It is a directory principle—one that guides courts toward fulfilling the spirit of the law rather than rigidly adhering to its letter.

It is necessary to elucidate, Section 26 of the Transfer of Property Act to explain whether a statutory provision is mandatory or directory. This particular Section shows the character of directory provision due to the fact that, only substantial compliance with the statute is required rather than strict compliance. Section 26 states:

“26. Fulfilment of condition precedent.—

Where the terms of a transfer of property impose a condition to be fulfilled before a person can take an interest in the property, the condition shall be deemed to have been fulfilled if it has been substantially complied with.”

Now, it is imperative to interpret Section 27 of the Transfer of Property Act to explain whether a statutory provision is mandatory or directory. Section 27 states:

“27. Conditional transfer to one person coupled with transfer to another on failure of prior disposition.—

Where, on a transfer of property, an interest therein is created in favour of one person, and by the same transaction an ulterior disposition of the same interest is made in favour of another, if the prior disposition under the transfer shall fail, the ulterior disposition shall take effect upon the failure of the prior disposition, although the failure may not have occurred in the manner contemplated by the transferor.

But, where the intention of the parties to the transaction is that the ulterior disposition shall take effect only in the event of the prior disposition failing in a particular manner, the ulterior disposition shall not take effect unless the prior disposition fails in that manner.”

In the aforementioned Section, two distinct situations are presented. Now, let’s delve into the two situations:

Directory Provision:

In the first situation, an action is outlined as necessary to acquire a right for someone. Interestingly, there’s an additional provision that grants a right to another person even if the specified action failed to occur exactly as prescribed. In such cases, the provision as a whole should be regarded as directory—meaning it provides guidance rather than imposing a strict mandate.

Mandatory Provision:

Contrasting with the first situation, the second scenario involves a specific act prescribed for acquiring a right to someone. Alongside this, there’s another option that confers a right on another person, but only if the specified act is failed to happen precisely in the manner specified. Here, adherence to the prescribed manner becomes essential, rendering this provision mandatory.

It is required to extrapolate Section 29 of the Transfer of Property Act to determine whether a provision is mandatory or directory in nature.  Section 29 of the Transfer of Property Act provides:

“29. Fulfilment of condition subsequent.—

An ulterior disposition of the kind contemplated by the last preceding Section cannot, take effect unless the condition is strictly fulfilled.”

The aforesaid Section demands strict construction. So we can deduce it as a mandatory provision.

Now, it is essential to define both terms as provided by Black’s Law Dictionary:

“DIRECTORY, adj. A provision in a statute, rule of procedure, or the like, which is a mere direction or instruction of no obligatory force, and involving no invalidating consequence for its disregard, as opposed to an imperative or mandatory provision, which must be followed. In re Opinion of the Justices, 124 Me. 453, 126 A. 354, 363. The general rule is that the prescriptions of a statute relating to the performance of a public duty are so far directory that, though neglect of them may be punishable, yet it does not affect the validity of the acts done under them, as in the case of a statute requiring an officer to prepare and deliver a document to another officer on or before a certain day. And see Pearse v. Morrice, 2 Adol. El. 94; Nelms v. Vaughan, 84 Va. 696, 5 S.E. 704. A “directory” provision in a statute is one, the observance of which is not necessary to the validity of the proceeding to which it relates; State v. Barnell, 109 Ohio St. 246, 142 N.E. 611, 613; one which leaves it optional with the department or officer to which it is addressed to obey or not as he may see fit; In re Thompson, 94 Neb. 658, 144 N.W. 243, 244. Statutory requisitions are deemed “directory” only when they relate to some immaterial matter where a compliance is matter of convenience rather than of substance. This mode of getting rid of a statutory provision by calling it “directory” is not only unsatisfactory, on account of the vagueness of the rule itself, but it is the exercise of a dispensing power by the courts, which approaches so near legislative discretion that it ought to be resorted to with reluctance, only in extraordinary cases, where great public mischief would otherwise ensue, or important private interests demand the application of the rule. Ellis v. Tillman, 125 Miss. 678, 88 So. 281, 283.

Directory statute. Under a general classification, statutes are either “mandatory” or “directory,” and, if mandatory, they prescribe, in addition to requiring the doing of the things specified, the result that will follow if they are not done, whereas, if directory, their terms are limited to what is required to be done. Hudgins v. Mooresville Consol. School Dist., 312 Mo. 1, 278 S.W. 769, 770. A statute is mandatory when the provision of the statute is the essence of the thing required to be done; otherwise, when it relates to form and manner, and where an act is incident, or after jurisdiction acquired, it is directory merely. State v. Kozer, 108 Or. 550, 217 P. 827, 832.”

“MANDATORY, adj. Containing a command; preceptive; imperative; peremptory. A “mandatory” provision in the statute is one the omission to follow which renders the proceedings to which it relates void, while a “directory” provision is one the observance of which is not necessary to validity of the proceeding. Siedschlag v. May, 363 Ill. 538, 2 N.E.2d 836, 838. So the mandatory part of a writ is that which commands the person to do the act specified. State v. Barnell, 109 Ohio St. 246, 142 N.E. 611, 613; Williams v. Sherwood, 51 N.D. 520, 200 N.W. 782, 784. It is also said that when the provision of a statute is the essence of the thing required to be done, it is mandatory, Kavanaugh v. Fash, C.C.A.Okl., 74 F.2d 435, 437; otherwise, when it relates to form and manner; and where an act is incident, or after jurisdiction acquired, it is directory merely, Davis v. Smith, 58 N.H. 17. “Mandatory” statutory provision is one which must be observed, as distinguished from “directory” provision, which leaves it optional with department or officer to which addressed to obey it or not. State ex rel. Dworken v. Court of Common Pleas of Cuyahoga County, 131 Ohio St. 23, 1 N.E.2d 138, 139. MANDATORY, n. One to whom a mandate is given; one who undertakes without compensation to perform certain duties. Swords v. Simineo, 216 P. 806, 809, 68 Mont. 164; Smith v. State, 199 Ind. 217, 156 N.E. 513, 515.”

The distinction between the two terms can be summarised as follows:

- *Mandatory*: This term describes provisions in statutes or regulations that must be strictly adhered to. Non-compliance with a mandatory provision typically invalidates the act or decision made under that provision. These provisions are considered imperative and leave no room for discretion.

- *Directory*: This term refers to provisions in statutes or regulations intended to guide or instruct without binding force. Non-compliance with a directory provision does not invalidate the act or decision. These provisions are advisory and often pertain to the manner or form of performing an act rather than its substance.

Whether a statutory provision is mandatory or not depends on various factors. The use of the word “shall” is not solely determinative. Although “shall” usually denotes a mandatory nature, there are instances where it has been interpreted as directory. To conclude whether a statutory provision is mandatory, the court must determine the object and purpose of the Act in question. The Court has to ascertain the object, design, purport and the context in which the provision of law was enacted. If the Act’s object would be defeated by non-compliance, the statute is considered mandatory. If a provision of law prescribes that, for a person to acquire a right a certain act has to be done in a particular manner and it is coupled with another provision which confers a right on another when such act is not done in that manner, then it has to be regarded as a mandatory provision.

Procedural law can be mandatory also. Section 69 of the Indian Partnership Act, 1932 is one of such instance which has been held to be mandatory by the Supreme Court in Seth Loonkaran Sethiya & Ors. v. Mr. Ivan E. John & Ors., (1977 KLT OnLine 1131 (SC) = (1977) 1 SCC 379). The time to file written statement as prescribed by the Act of 2015 by introducing amendments to the procedural part of the Code of Civil Procedure, 1908 has been held to be mandatory by the Supreme Court in SCG Contracts (India) Private Ltd. v. K.S. Chamankar Infrastructure Private Ltd. & Ors., (2019 (1) KLT OnLine 3040 (SC) = (2019) 12 SCC 210 . Section 80 of the Code of Civil Procedure, 1908 which is a procedural provision has been held to be mandatory by Supreme Court in State of Maharashtra v. Chanderkant (1976 KLT OnLine 1114 (SC) = (1977) 1 SCC 257). In State of Kerala v. Sudhir Kumar (2013 (3) KLT OnLine 1005 (SC) = (2013) 10 SCC 178) the Supreme Court has held that, a suit filed without complying with Section 80(1) of the Code of Civil Procedure, 1908 cannot be regularised by filing an application under Section 80(2).” In Ajit Kumar Sen & Anr. v. State of West Bengal & Ors., (1952 KLT OnLine 841 (Cal.) = AIR 1954 (Cal.) 49),
while considering the provisions of Section 45(3) of the Calcutta Municipal Act, 1923, the Calcutta High Court has expressed the view that the question whether a particular provision is imperative or directory is complex. There cannot be a hard and fast rule of general application. However, there are three fundamental tests which are often applied.

The three fundamental tests often applied by the High Courts and Supreme Courts to distinguish whether a statutory provision is mandatory or directory can be explained as follows:

    1. The use of language: If the statute uses words like “shall,” it generally implies that the provision is mandatory. However, this is not always conclusive and must be interpreted in context.

    2. The legislative intent: The court must consider the purpose of the statute and the legislative intent behind the provision.

    3. The consequences of non-compliance: The court must evaluate whether non-com-pliance with the provision would result in serious consequences or invalidate the action taken under the statute. If non-compliance leads to significant consequences,the provision is likely mandatory.

The following quotation from Crawford “On the Construction of Statutes”, at p. 516, is also helpful in this connection:

“The question as to whether a statute is mandatory or directory depends upon the intent of the legislature and not upon the language in which the intent is clothed. The meaning and intention of the legislature must govern, and these are to be ascertained, not only from the phraseology of the provision, but also by considering its nature, its design, and the consequences which would follow from construing it the one way or the other......”

Furthermore, in the 5th edition of Craies on Statute Law, there is a passage on page 242 that sheds light on whether a statutory provision is mandatory or directory. It states as follows:

“No universal rule can be laid down as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience. It is the duty of Courts of Justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed.”

A valuable guide for ascertaining whether a statutory provision is mandatory or directory can be found in Maxwell on “The Interpretation of Statutes”, 10th edition, at p. 381 and it is:

“On the other hand, where the prescriptions of a statute relate to the performance of a public duty and where the invalidation of acts done in neglect of them would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty without promoting the essential aims of the legislature, such prescriptions seem to be generally understood as mere instructions for the guidance and government of those on whom the duty is imposed, or, in other words, as directory only. The neglect of them may be penal, indeed, but it does not affect the validity of the act done in disregard of them.”

The Supreme Court in Hari Vishnu Kamath v. Syed Ahmad Ishaque & Ors., (1955 KLT OnLine 1012 (SC) = AIR 1955 SC 233) has considered provisions of Article 329(b) of the Constitution. It has observed that, an enactment in form mandatory might in substance be directory. The use of the word shall does not conclude the matter. However, the true intention of the legislature is the determining factor and that, whether a provision is mandatory or directory will depend upon the context. It has explained that, the distinction between a provision which is mandatory and one which is directory. It has observed that, while a provision which is mandatory must be strictly observed, in the case of a provision which is directory, it is sufficient that it is substantially complied with.

The Supreme Court in Sharif-ud-Din v. Abdul Gani Lone, (1980 KLT OnLine 1056 (SC) = AIR 1980 SC 303) has considered the provisions of Jammu & Kashmir Representation of People Act, 1957. It has held that, in order to find out the true character of the legislation, that is, whether the legislation is mandatory or directory in nature, the Court has to ascertain the object which the provision of law in question is to subserve and the design and the context for which it is enacted. If the object of a law is to be defeated by non-compliance with it, then, such provision is to be regarded as mandatory, but when a provision of law relates to any performance of any public duty and the invalidation of any act done in disregard of that provision causes serious prejudice to those for whose benefit it is enacted and at the same time who have no control over the performance of the duty, such provision should be treated as a directory one. It has held that, where, a provision of law prescribes that a certain act has to be done in a particular manner by a person in order to acquire a right and which is coupled with another provision which confers an immunity on another when such act is not done in that manner, the former has to be regarded as a mandatory one. A procedural rule ordinarily should not be construed as mandatory if the defect in the act done in pursuance of it can be cured by permitting appropriate rectification to be carried out at a subsequent stage unless by according such permission to rectify the error later on, another rule would be contravened. Whenever a statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to a specific consequence, such a requirement should be held to be mandatory.

In Owners and Parties interested in M.V. Vali Pero v. Fernandeo Lopez & Ors., (1989 (2) KLT OnLine 1015 (SC) = (1989) AIR SC 2206), the Supreme Court has considered the Calcutta High Court Rules. It has held that, the defect of not taking the signature of the witness on the deposition was not fatal to the reception of the deposition in the evidence. It has observed that, Rules of Procedure are not by themselves an end but the means to achieve the ends of justice. Construction of the Rule of procedure which permits justice and prevents miscarriage by enabling the Court to do justice in myriad situation, all of which cannot be envisaged, acting within the limits of the permissible construction, must be preferred to that which is rigid and negatives the cause of justice.

The Supreme Court in Chandrika Prasad Yadav v. State of Bihar. Ors. (2004 (1) KLT OnLine 1368 (SC) = AIR 2004 SC 2036) has observed that, the question as to whether a statute is directory or mandatory would not depend upon the phraseology used. The principle as regards the nature of the statute must be determined having regard to the purpose and object to the statute seeks to achieve.

The Patna High Court in Smt.Sunita Devi & Ors. v. Abdhesh Kumar Sinha alias Kamleshwari Pd. Sinha & Ors., (2005 (2) KLT OnLine 1136 (Pat.) = AIR 2005 Pat.136)  has held that, the provisions of Order VIII Rule 1 of the Code of Civil Procedure, 1908 are not mandatory and that in exceptional cases, written statement can be accepted beyond the time limit prescribed by the Code of Civil Procedure, 1908. The Supreme Court in R.N.Jadi & Brothers &Ors. v. Subhash Chandra, (2007 (3) KLT SN 53 (C.No.66) SC = (2007) 6 SCC 420), Salem Advocate Bar Association, Tamil Nadu v. Union of India, (2005 (4) KLT SN 32 (C.No.43) SC = (2005) 6 SCC 344) and Zolba v. Keshao & Ors., (2008 (2) KLT OnLine 1158 (SC) = (2008) 11 SCC 769)  has considered the provisions of Order VIII Rule 1 of the Code of Civil Procedure, 1908 which limits the time period for filing a written statement by a defendant in a suit. In Salem Advocate Bar Association, Tamil Nadu (supra) the Supreme Court has held that, Order VIII Rule 1 and the proviso thereto are directory in character and not mandatory. Such view has been reiterated in R.N. Jadi& Brothers & Ors. (supra) and Zolba (supra).

The Supreme Court in State of U.P. v. Manbodhan Lal Srivastava, (1957 KLT SN 66 (C.No.167) SC = AIR 1957 SC 912) has observed that the use of the word shall in a statute, though generally taken in a mandatory sense, does not necessarily mean that in every case it shall have effect that is to say that, unless the words of the statute punctiliously valid, the proceeding or the outcome of the proceeding would be invalid. It has observed that, Article 320(3)(c) is not mandatory. Irregularity in consultation with public service commission does not afford a public servant with cause of action in a Court of Law.

The Supreme Court in Shivjee Singh v. NagendraTiwary & Ors., (2010 (3) KLT SN 29 (C.No.37) SC = AIR 2010 SC 2261) has considered Section 1 and Section 202(2) proviso of the Criminal Procedure Code, 1973. It has held that, despite the use of the word shall, in Section 1 of the Criminal Procedure Code, 1973, it has to be treated as directory. It has held that, the proviso to Section 202(2) of the Criminal Procedure Code, 1973 is also not mandatory. The Supreme Court in Smt. Lila Gupta v. Laxmi Narain & Ors., (1978 KLT OnLine 1011 (SC) = (1978) AIR SC 1351) has considered the proviso to Section 15 of the Hindu Marriage Act, 1955 and held the same not to be mandatory.

The Supreme Court in Macquarie Bank Limited v. Shilpi Cable Technologies Limited, (2018 (1) KLT OnLine 3147 (SC) = (2018) 2 SCC 674) has considered Section 9(3)(c) of the Insolvency and Bankruptcy Code and held that, the same to be a procedural provision and directory in nature.

The Supreme Court in State of Bihar & Ors. v. Bihar RajyaBhumiVikas Bank Samiti, (2018 (3) KLT OnLine 3071 (SC) = (2018) 9 SCC 472) has considered the provisions of Section 34 of the Act of Arbitration and Conciliation Act, 1996 and held that, the views of the High Courts of Bombay and Calcutta represent the correct view. Srei Infrastructure Finance Limited v. Candor Gurgaon two Developers and Projects Pvt. Ltd., (2018 (2) KLT OnLine 3183 (Cal.) = 2018 SCC Online (Cal) 5606)of the Calcutta High Court has been noted therein. It has held that the vested right of a party to challenge the award under Section 34 cannot be taken away of a non-compliance of issuance of prior notice before filing of the arbitration petition.

The Full Bench of Kerala High Court in The Food Inspector, Cannanore Municipality, Cannanore v. M.Gopalan, (1991 (1) KLT 520 (F.B.) = AIR 1991 Kerala 240) while considering the provisions of Section 23 of the Prevention of Food Adulteration Act, 1954 and Rule 7(3) of the Prevention of Food Adulteration Rules, 1955 has held that Rule 7(3) of the Rules are directory in nature.

In Ambalal Sarabhai Enterprises Ltd v. K.S. Infraspace LLP & Anr., (2020 (1) KLT OnLine 1006 (SC) = (2019) SCC Online (SC) 1311) the Supreme Court has considered the issue whether the transaction between the parties in the suit under consideration before the Supreme Court can be considered as a commercial dispute so as to enable the Commercial Court to entertain the suit. It has held, the literal and strict interpretation has to be applied while interpreting a particular statute or a provision. Adverting to the various provisions of the Act of 2015 it has held the Act of 2015 allows the Court to adopt a proactive approach in resolving a commercial dispute. It has observed that. The intent of the legislature is to have a procedure which expedites the disposal of commercial disputes and thus create a positive environment for investment and development and make India an attractive place to do business. It has also held a purposive interpretation of the objects and reasons and the various amendments to the Code of Civil Procedure, 1908 made by the Act of 2015 leaves no room for doubt that the provisions of the Act of 2015 are to be strictly construed. The object shall be fulfilled only if the provisions of the Act of 2015 are and interpreted in a narrow sense and not hampered by the usual procedural delays plaguing the traditional legal system.

In Dhanbad Fuels Ltd v. Union of India, (2021 (1) KLT OnLine 1088 (Cal.) =2021 0 Supreme (Cal.) 72); the Court has considered an order passed by the Commercial Court rejecting an application under Order VII Rule 11(d) of the Code of Civil Procedure, 1908 seeking dismissal of the suit in view of non compliance of Section 12A of the Act of 2015. In the facts of that case, the defendant in the suit filed an application under Order VII Rule 11(a) of the Code of Civil Procedure, 1908 which was rejected. The defendant did not raise the issue of non compliance of Section 12A of the Act of 2015 therein. The subsequent application under Order VII Rule 11(d) for rejection of the plaint on the ground of non compliance of Section 12A of the Act of 2015 filed more than a year since institution of the suit was rejected by the Trial Court. In revision, the Court had directed reference to mediation and stay of the suit for limited period so as to allow the process of mediation to run its course. The Revisional Court had taken note of the fact that the suit was filed in August 2019, Standard Operating Procedure for Pre-institution Mediation and Settlement was prescribed on December 11, 2020 and the panel for trained mediators was availed on January 27, 2020.

To sum up, if non-fulfillment of a condition does not invalidate a statutory provision, it is directory. However, if non-compliance renders the statutory provision otiose and nugatory, it is mandatory. In short, a statutory provision is directory when substantial compliance is sufficient and mandatory when strict compliance is required.

Cyber Security and Machine Learning : Complementary or Supplementary ?

(By Dr. Raju Narayana Swamy, IAS) 
E-mail : narayanan5@ias.nic.in      Mob. 9447010602

The digitalisation of almost every area of society has changed the rules of our economy.  Cloudification, IoT and BYOD (Bring Your Own Device to Work) are all giving rise to micro environments that contain a lot of sensitive data.  If these devices fall into wrong hands, it could certainly lead to grave consequences. o put it a bit differently, cyber security - the technology, process and practice to protect networks, devices, programs and data from attacks, damages or unauthorized access - will not only become a crucial issue for the safety of our new digital critical systems, but it will also be a prerequisite for creating trust in our digital economy.  The situation is further alarming when one considers the newer types of attacks, which are mostly machine engineered. Thus cyber security which was a war among humans has changed to a battle of human versus machine. In fact the old protection mechanism which was largely a “seal the borders” approach via firewalls, proxies, antivirus software, access controls and dynamic passwords is today grossly inadequate.  A new approach is required to continuously monitor the large number of  factors and detect what constitutes abnormal activity.  This could be similar to our body’s immune system where the white cells and antibodies are continuously scanning and neutralizing any organism that does not fit the normal functioning patterns within the body.  This is where AI comes into play.  It needs to be reiterated here that AI works in three ways - assisted intelligence, augmented intelligence and autonomous intelligence.

The primary targets for AI application in cyber security are network intrusion detection, malware analysis and classification, phishing and spam emails.  Machine learning (ML) algorithms can recognize potential security breaches or attacks by continuously observing what is an abnormal behaviour and given the authority, they can automatically shut down systems under perceived threat. In fact ML can revolutionize the way cyber security has been handled to date - whether it be in detection, protection, prediction or termination.  There are broadly two categories of possible uses:-

a.  Apply supervised learning to the massive amount of historical data to continuously improve prediction capabilities.

b.  Apply unsupervised learning to make some sense out of the massive amount of data through clustering and dimensionality reduction techniques.

As regards the former, the most talked about cases in the context of cyber security are malware classification and spam detection.  In Gmail for example, the supervised machine learning algorithm scans countless variables such as the originating IP address and phrases in the email content to determine whether the email conforms to an abnormal pattern and then pushes it out of your inbox folder into the junk folder.

As regards the latter, context and expert knowledge base are two critical aspects to make sense out of raw data.  For instance, rather than looking at network traffic logs in isolation,we need to add context to make sense of the data such as whether the device is supposed to respond to DNS queries.  If it is a DNS server, then this is absolutely a normal behaviour, but if it is not, the behaviour could be the sign of an attack.

However, there is a hitch – machine learning lacks the general knowledge required to distinguish real threats leading to too many false alarms.  A potential solution could be a hybrid human-machine collaborative approach such as the AI2 cyber security platform from MIT’s Computer Science and Artificial Intelligence Lab.  Here human experts handle the judgment related tasks of validating and classifying the threats and associating severity tags.

A major challenge here lies in defining what is not an anomaly.  For example, starting from reading the morning news online to shopping to travel booking to carry our work-related activities, we use our laptops in many different ways.  There could also be infrequent patterns such as downloading a game or organising pictures from a vacation. In essence, the most potent security threats are not just statistical outliers.

Most cyber attacks follow certain attack phases that can be described as a cyber kill chain.  Every attack sequence starts with a reconnaissance phase (in which an attacker tries to locate gaps and vulnerabilities of a target system). The weaponizing phase follows.  This is followed by the delivery phase when the malware is transferred to the potential target.  After the malware is delivered successfully, the exploit phase occurs during which the malware triggers the installation of an intruder’s code. Aim of ISA (Integrated Security Approach) is to generate early warnings before the exploit phase.

ANNs (Artificial Neural Networks: statistical learning models imitating the structure and function of the human brain) have been used successfully within all stages of ISAs.  ANNs can be used to learn from past network activities and attacks in order to prevent future attacks from actually transpiring. DNNs (Deep Neural Networks: a more elaborate and computationally expensive form of ANNs) have been used not only to protect organizations from cyber attacks, but also to predict these attacks.

It must not be forgotten that machine learning is no silver bullet.  Just as businesses are beginning to adopt AI systems, attackers are aslo finding ways to manipulate the same AI systems.  They are focusing on finding ways to turn AI against its owners -from hacking chatbots to deliberately misleading pattern recognition algorithms.  A classic example is Tay, a chat bot introduced by Microsoft to engage people through casual and playful conversation. Within 24 hours, a structured attack on Tay resulted in the bot shouting all sorts of misogynistic and racist comments.

To summarize, through AI powered cyber security is no panacea, AI will become a standard element of cyber security in the short term.  But AI needs to deliver greater accuracy in detection and fewer false positives for it to earn the trust. A drawback of using AI within cyber security is the concern of data privacy.  Moreover due to the unique and unforeseeable nature of AI, existing legal frameworks do not necessarily apply to this discipline. Cyber security being a back-and-forth game between attackers and defenders that will constantly evolve as technology grows, AI needs to be trained for all these varied scenarios.  Attackers are already using AI to power their attacks – spear phishing tweets being classic instances – and we must deploy AI – driven defenses to keep up.

     As an example, the AI – driven defenses of tomorrow must be geared up to deal with the upcoming challenge of generative adversarial networks (GAN), a class of machine learning frameworks that can be used to generate deep fakes by swapping or manipulating faces or voices in an image or a video.  In fact, offences on AI systems often  appear in three areas – adversarial inputs, poisoning training data and model extraction attacks.

The reality is that until now, AI alone has not proven overall success in cyber protection.  Despite the great improvements that AI has brought to the realm of cyber security, related systems are not yet able to adjust fully and automatically to changes in their environment, learn all the threats and attack types and choose and autonomously apply dedicated countermeasures to protect against these attacks.  

 AI methods in Cyber Security

DT = Decision Tree;

SVM = Support Vector machine

NB = Naive Baye’s classifier

K= K- means clustering

HMM = Hidden Markov Model

GA = Genetic Algorithm (heuristic search algorithm employing the concept of genetics and natural selection)

ANN = Artificial Neural Network

CNN = Convolutional Neural Networks

RNN = Recurrent Neural Network

SNN = Siamese Neural Network

In the Indian context, the challenges are even more:

a. Large digital divide (Lack of digital literacy makes them vulnerable to phishing attacks and online scams)

b. Fragmented cyber security infrastructure: Responsibility for cyber security is distributedacross various government agencies and private entities leading to a lack of coordination

c. Shortage of qualified cyber security professionals.

Needless to say cyber security is not only a technological issue, it is also about regulation and the way that security risks are dealt with.  At the end of the day it is still the human factor that malters – not only the tools.

Section 125 of the Criminal Procedure Code (Now Replaced with
Section 144 of Bharathiya Nagarik Suraksha Sanhita,2023 ):
A Potential Contravention of Article 14 of the Indian Constitution?

(By Adv.S.Balachandran (Kulasekharam), Thiruvananthapuram)

E-mail : balachand59@gmail.com                                                          Mob. 9387734030

Article 14 of the Constitution of India enshrines the principles of equal protection under law and equality before the law for all citizens. In India’s legal landscape, the endorsement of gender discrimination in favour of either gender in any field is deemed a violation of this constitutional mandate and, by extension, is unconstitutional. This brings to light an intriguing question related to Section 125 of the Criminal Procedure Code (now replaced with Section 144 of Bharathiya Nagarik Suraksha Sanhita, Act 46/2023).The Code and Sanhita, outlining the ‘Maintenance of Wives, Children and Parents’, appears to provide a unique status to women, particularly related to maintenance rights. The question then arises is Section 125 of the Criminal Procedure Code and Section 144 of Act 46/2023 denying men equality as guaranteed by the law?

There are situations where husbands, who have been deserted and are unable to fend for themselves, are further neglected by their financially capable wives. This raises important questions about the concept of equality before the law.

Throughout my career, my path has crossed with several unfortunate men, often non-resident Indians, who diligently toil day and night in Gulf countries, sending substantial portions of their income to their wives in India. The wives frequently use this money to regularly purchase property in their own names. The husbands perpetuate this cycle, hoping to eventually retire and lead a peaceful, wealthy life with their families. But, regrettably, reality bites, and they are often left to fend for themselves, with their dreams shattered and hard-earned wealth pilfered.

Whenever the husbands are amassing much wealth and when they arrive at the native places, they will be whole heartedly welcomed and treated by their wives and it will strengthen the confidence of the husbands. The real tragedy starts, when the husbands arrive after winding up of his job or he was deported from that country, with no money in his hands. In most of the cases, at those occasions nobody will be there in the Airport to receive him.On their return to India, instead of a warm welcome, many encounter restraining orders under Domestic Violence Act barring their entry into their own houses, leaving them homeless and leading to lengthy legal battles to reclaim what was once theirs.

The story of a Millionaire and a Fishmonger gets to the heart of this matter – should enjoyment of life be deferred for future wealth by overworking at the expense of happiness and youth, or should there be a balance of work and enjoyment each and every day?“The Millionaire told to the Fishmonger that, you see I worked hard for about 25 years, earned much wealth  and now I am luxuriously  spending my time and is enjoying the life.  The
Fishmonger told that, why should I wait for 25 years for enjoyment of life.  After 4 hours of work on every day, I used to enjoy my life along with my wife and children and am taking rest every day.  I may not be aliveafter the so called 25 years of hard work for enjoyment of my life.”

The notion that women are the weaker section of the community and depend on their husbands for livelihood now seems like an outdated concept. Today, over 75% of women are employed across all sectors, starkly contrasting the perception of women as financially dependent.

Even if the wife is immensely rich, after desertion of husband, she is living in adultery, no legal liability was imposed upon her to maintain her children  and parents and it is vice versa in the case of husbands. These are all total inequality.

Under Section 18 of Hindu Adoptions and Maintenance Act also, the liability of payment of maintenance is imposed upon the husband alone. This Act was of the year 1956,probably based on the situation of wives during those period, such a restriction was imposed upon the said Act. But under Section 20 of Hindu Adoptions and Maintenance Act, the liability to maintain children and parents are equally imposed upon the man and woman. Under Christian Law, no statutory liability was cast upon the husband to maintain his wife. But in equity, based on the decisions of the Honourable High Court of Kerala, maintenance were award to the christian wives.

Considering the changing societal dynamics, it is crucial to reconsider laws such as Section 125 of the Cr.P.C. , Section 144 of Act 46/2023 and Section 18 ofHindu Adoptions and Maintenance Act. Quite possibly, it should now be the socio-economic status of an individual, rather than their gender, that determines the ‘weaker section’ of the community. Therefore, the wording of Section 125 of the Cr.P.C., and Section 144 of Act 46/2023 should be revisited, with propositions to replace “his wife” with “any spouse”, thus reflecting a gender-neutral view and maintaining the spirit of equality before the law.

Article 14 of the Constitution of India pledges equity, and our legislation needs to reflect this pledge comprehensively and without bias. It is time we broadened our legal discourse to encompass these evolving societal norms.