MONSANTO TECHNOLOGY LLC THRU THE AUTHORISED REPRESENTATIVE MS. NATALIA VORUZ & OTHERS versus NUZIVEEDU SEEDS LTD. THRU THE DIRECTOR & OTHERS on 8 January 2019

MONSANTO TECHNOLOGY LLC THRU THEAUTHORISED REPRESENTATIVE MS. NATALIA

VORUZ & OTHERS

v.

NUZIVEEDU SEEDS LTD. THRU THE

DIRECTOR & OTHERS

(Civil Appeal Nos. 4616-4617 of 2018)

JANUARY 08, 2019

[R. F. NARIMAN AND NAVIN SINHA, JJ.]

Code of Civil Procedure, 1908:

s.9 – Suit / Counter Claim – Adjudication – Procedure for –Suit seeking permanent injunction against defendants, restrainingthem from using their registered trade-mark in violation of theregistered patent – Also sought temporary injunction by filingapplication u/Or. 39 rr. 1 and 2 of CPC – Defendants filed WrittenStatement as well as their Counter Claim seeking revocation of thepatent u/s.64 of Patents Act – Single Judge of the High Court whiledeciding application for injunction observed that nature and extentof the patent claim was a matter to be examined after pleadingswere complete and evidence adduced, which did not merit commentsat the stage of interim injunction – Single Judge issued notice onthe Counter Claim – Appeal by both the parties – Division Bench ofHigh Court while allowing the Counter Claim of the defendantsdismissed the claim of the plaintiffs as regards the patent – Onappeal, held: Section 64 of Patents Act necessarily presupposes avalid consideration of the claims in the suit and the Counter Claimin accordance with law and not summary adjudication sans evidence,by abstract consideration – CPC provides a detailed procedure withregard to the manner in which a suit instituted u/s. 9, includingCounter Claim has to be considered and adjudicated – DivisionBench of High Court ought not to have examined the Counter Claimin a summary manner usurping the jurisdiction of Single Judge –Summary adjudication of a technically complex suit requiring expertevidence, that too at the stage of interim injunction, was neither

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Adesirable nor permissible – Division Bench ought to have confineditself to examination of the validity of the order of interim injunction– In the facts and circumstances of the case, nature of the injunctionrelief was in order and merits no interference during pendency ofthe suit – Matter remanded to Single Judge – Patents Act, 1970 – s.3(j) and 64.B

Disposing of the appeals, the Court

HELD: 1. Section 64 of the Patents Act provides forrevocation of patent based on a counter claim in a suit. Itnecessarily presupposes a valid consideration of the claims inCthe suit and the counter claim in accordance with law and notsummary adjudication sans evidence by abstract considerationbased on text books only. The Civil Procedure Code provides adetailed procedure with regard to the manner in which a suitinstituted under Section 9, including a counter claim has to beconsidered and adjudicated. The CPC mandates a procedure byDsettlement of issues, examination and cross-examination ofwitnesses by the parties, including discovery/inspection ofdocuments, culminating in the hearing of the suit and decree. Asuit can be disposed of at the initial stage, only on an admissioninter alia under Order 12 Rule 6 of CPC or when the parties areEnot in issue under Order 16 Rule 1 and the other grounds. [Para23][158-D-E]

2. The Division Bench of High Court ought not to havedisposed of the suit in a summary manner by relying on documentsonly, extracted from the public domain, and not even filed asFexhibits in the suit, much less examination of expert witnesses,in the facts of the present case. The issues raised werecomplicated requiring technological and expert evidence withregard to issues of chemical process, biochemical, biotechnicaland micro-biological processes and more importantly whetherthe nucleic acid sequence trait once inserted could be removedGfrom that variety or not and whether the patented DNA sequencewas a plant or a part of a plant etc. are again all matters whichwere required to be considered at the final hearing of the suit.[Para 23][158-F-H]

Alka Gupta v. Narender Kumar Gupta (2010) 10 SCC141 : [2010] 1 SCR 756 – relied on.

3. The Division Bench ought not to have examined thecounter claim itself usurping the jurisdiction of the Single Judgeto decide unpatentability of the process claims 1-24 also in thesummary manner done. Summary adjudication of a technicallycomplex suit requiring expert evidence also, at the stage ofinjunction in the manner done, was certainly neither desirablenor permissible in the law. The suit involved complicated mixedquestions of law and facts with regard to patentability andexclusion of patent which could be examined in the suit on thebasis of evidence. [Para 22][158-A-C]

4. The Division Bench ought to have confined itself toexamination of the validity of the order of injunction granted bythe Single Judge only. In the facts and circumstances of thecase, the nature of the injunctive relief granted by the SingleJudge was in order and merits no interference during thependency of the suit. The order of the Single Judge dated28.03.2017 is restored and the suit is remanded to the SingleJudge for disposal in accordance with law. [Paras 25, 26][159-G;160-A]

“Marker-Assisted Recurrent Backcrossing in CultivarDevelopment” by Guoyou et.al – referred to.

Case Law Reference

[2010] 1 SCR 756relied onPara 24

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 4616-4617 of 2018.

From the Judgment and Order dated 11.04.2018 of the High Courtof Delhi at New Delhi in FAO(OS)(COMM) No. 86 of 2017 andFAO(OS)(COMM) No.76 of 2017.

WITH

Civil Appeal Nos. 188, 189-190 and 191-192 of 2019.

Dr. A. M. Singhvi, Neeraj Kishan Kaul, Kapil Sibal, Sanjiv Sen,Arvind P. Datar, K. V. Viswanathan, Shyam Divan, Jayant Bhushan,Krishnan Venugopal, Rana Mukherjee, Shyam Divan, N. K. Kaul, A

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ASr. Advs., Pravin Anand, Mahesh Agarwal, Rishi Agrawala, Ms. ArchanaShankar, Dhruv Anand, Shrawan Chopra, Karan Luthra, VishnuTallapragada, Shubham Kulsheshtra, Adarsh Ramanujan, R. V. Prabhat,Vibhav Mithal, Ms. Udita Patro, Ms. Shruti Arora, Dr. Neeti Wilson,Azeem Samuel, Avishkar Singhvi, Ms. Gitika Suri, E. C. Agrawala, PravinAnand, R. N. Karanjawala, Ms. Ruby Singh Ahuja, Ms. Deepti Sarin,BSanjeet Ranjan, Ms. Archana Shanker, Dhruv Anand, Shrawan Chopra,Mrs. Manik Karanjawala for M/s.Karanjawala & Co., Ms. SwikritiSinghania, Sayan Ray, Ms. Anindita Mitra, Soumo Palit, Chaitanya Mehta,Ms. Diya Kapur, Essenese Obhan, Abhishek Saket, Ms. Neha Khanduri,Rishabh Sharma, Ms. Sugandha Batra, Raghav Anand, Ms. VrindaCBhandari, Feorz Ali, Ketan Paul, Ms. Reeja Varghese, Tushar Bhushan,Ranjan Kumar Pandey, Sandeep Bisht, Ms. Liz Mathew, Jitendra Kumar,Ram Krishan, Aditya Dhar, Anuj Tiwari, Rahul Kumar, Ritwik Sahay,Aditya Sharma, Praneet Pranav, Ms. Ankita Chaudhary Rathi, SantoshKumar, Nachiketa Joshi, Gunjan Singh, Satya Mitra, Amar Dave,P. S. Sudheer, Rishi Maheshwari, Ms. Anne Mathew, Ms. Pooja Katara,DMs. Aparna Kareer, Senthil Jagadeesan, Ms. Sonakshi Malhan, Ms.Suriti Chowdhary, Ms. Mrinal Kanwar, Satya Vikram, Abhishek Saket,Ms. Shahana Farah, Manish Madhukar, Rahul Dubey, M. Haque, ChitralGambhir, Pranav Gupta, Ms. Lekha V. G., Ms. Manisha Singh, AbhaiPandey, Devanshu Sajlan, Sanyat Lodha, Deepak Joshi, Akash Lamba,EAdvs. for the appearing parties.

The Judgment of the Court was delivered by NAVIN SINHA, J. 1. Leave granted.

2. The appellants/plaintiffs in Civil Appeal Nos.4616-4617 of 2018Finstituted Civil Suit (Comm) No. 132 of 2016 seeking permanent injunctionagainst the defendants from using the trademark “BOLGARD” and“BOLGARD II” brand cotton technology, violating the registered patentno. 214436 of the plaintiffs, and also to further restrain the defendantsfrom selling and or using seeds/hybrid seeds bearing the patentedtechnology, infringing the registered patent of the plaintiffs, along withGrendition of accounts. The parties shall, for convenience, be referred toby their position in the original suit.

3. The plaintiffs pursuant to their patent rights had entered into asub-licence agreement dated 21.02.2004 with the defendants for an initialperiod of ten years. The agreement entitled the defendants to develop“Genetically Modified Hybrid Cotton Planting Seeds” with help of theplaintiffs’ technology and to commercially exploit the same subject tothe limitations prescribed in the agreement. The agreement also providedfor payment of licence fee/trait value by the defendants, for use of theplaintiffs’ patented technology. The agreement after extension wasultimately terminated by the plaintiffs on 14.11.2015 due to disputesregarding payment of licence fee/trait value in view of subsequent pricecontrol regime introduced by the State, and to which the defendantsrequired adherence by the plaintiffs. The plaintiffs filed an applicationfor injunction under Order 39, Rule 1 and 2 of the Code of Civil Procedure(hereinafter referred to as ‘the Code”), to restrain the defendants fromusing their registered trade mark in violation of the registered patentduring the pendency of the suit in view of the termination of theagreement.

4. The defendants in their written statement inter alia contendedthat their rights were protected under the Protection of Plant Varietiesand Farmers’ Rights Act, 2001 (hereinafter referred to as ‘the PPVFRAct’). The suit patent was bad because claims 1-24 were “processclaims” concerning genetic engineering or biotechnology method to insert“Nucleic Acid Sequence” (NAS) into a plant cell as in claim 25-27practiced in laboratory conditions, unlike the complete biological processadopted by the defendants. The NAS was a chemical compositionincapable of reproducing itself and was thus not a micro-organism. Onlyon insertion into a plant, a living organism, it imparts Bt.trait (insectresistance) to the living organism. The defendants also filed a counterclaim no.51 of 2016 seeking revocation of the patent under Section 64 ofthe Act, as being in violation of Section 3(j) of the Patents Act (hereinafterreferred to as “the Act”) in respect of plants and seeds that containedDNA sequences, denying any infringement.

5. The learned Single Judge on 28.03.2017, while deciding theplaintiffs’ application for injunction, observed that the issues arising inthe suit necessarily required formal proof, particularly expert opinion,which in complicated matters like that of patent were crucial forascertaining the breadth of the monopoly granted by the specificationsof a patent claim. The nature and extent of the patent claim was more A

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Aproperly a matter to be examined after pleadings were complete andevidence adduced on the issues arising, which did not merit commentsat the stage of interim injunction. Considering the existing patentregistered under Section 48 of the Act, it was ordered that during thependency of the suit, the parties shall remain bound by their respectiveobligations under the sub-licence agreement and that the licence fee/Btrait value payable by the defendant shall be governed by the laws inforce. The learned Single Judge simultaneously only issued notice onthe counter claim no.51 of 2016. The order of injunction dated 28.03.2017,therefore did not deal with or consider the counter claim. It was primafacie observed that the defendants having had the advantage of a sub-Clicence ever since 2004, appeared unjustified in contending that theywere not bound by the obligations under the agreement in view of theclaimed statutory protections vis-à-vis the suit patent or the registeredtrademarks. Prima facie opining that the termination of the sub-licenceagreement by the plaintiffs on 14.11.2015 appeared unjustified in viewof the statutory price restrictions, the termination was held not to be ofDany consequence.

6. Aggrieved, both the Plaintiffs and the defendants preferredappeals. The Division Bench dismissed the plaintiffs’ appeal upholdingthe defendants’ contention with respect to patent exclusion under Section3(j) of the Act and that the plaintiffs were at liberty to claim registrationEunder the PPVFR Act, as the two Acts were not complementary, butexclusive in the case of all processes and products falling under Section3(j) of the Act. Consequentially, the defendants’ counter claim succeeded.The suit was, however, permitted to continue with regard to the claimfor damages and other reliefs. The plaintiffs were required to continueFwith their obligations under the sub-licence agreement including paymentof licence fee/trait value by the defendants in accordance with law.

7. We have heard learned senior counsel Dr. Abhishek ManuSinghvi, Sri Kapil Sibal, Sri Neeraj Kaul, Sri K.V. Vishwanathan, SriArvind P. Datar, Sri Jayant Bhushan, Sri Krishnan Venugopal, Sri ShyamGDivan and Sri Sanjiv Sen, and learned counsel Sri Prasahant Bhushanand Ms. Anandita Mitra on behalf of the parties.

8. Dr. Abhishek Manu Singhvi contended that the plaintiffs’ suitwas for injunction restraining infringement of an existing and valid patent.The lack of patentability was never an issue in the suit. The defendants H

argued lack of patentability to invalidate the primary issue relating toinfringement only. The counter claim for revocation of the patent asunpatentable, was neither argued nor adjudicated by the learned SingleJudge. Only notice was issued on the counter claim bearing no.51 of2016 while counter claim bearing no.50 of 2016 challenging the terminationof sub-licence agreement was withdrawn. The issue for existence ofthe patent, patent exclusion under Section 3(j) of the Act was a heavilymixed question of law and facts requiring formal proof and expertevidence, to be considered at the hearing of the suit, as rightly observedby the Single Judge. The defendants in their memo of appeal themselvescontended that the issue regarding existence of the patent and/or itsrevocation could not have been decided summarily by the learned SingleJudge as these were matters which required evidence and could beadjudicated only at the final trial of the suit. The plaintiffs’ claims wereunder 25-27 only. The process claims 1-24 was never an issue inconsideration before the Single Judge and yet the Division Bench delved into the same and held the process claims to be bad also.

9. The plaintiffs had never consented to a summary adjudicationregarding the validity of its patent. The consent referred to by the DivisionBench, had been given only to decide whether the plaintiffs’ patent hadbeen infringed or not, as also the scope of the patent, so as to allow ordisallow the relief of injunction. It is incomprehensible that the plaintiffsholding a valid registered patent under the Act nonetheless would haveagreed to a summary consideration and validation/invalidation of thepatent. The patent comprises of a DNA construct or nucleotide sequencein claim 25-27 comprising of three different components, i.e. (i) a promoter(ii) a man-made gene for the production of Cry2Ab 5-endotoxin and, (iii)a third component for the production of a transit peptide 6. The DNAconstruct so created did not exist in nature and upon insertion into aplant confers insect tolerant trait. A plant is next produced as a “fusionprotein” which comprises the Cry2Ab S-endotoxin 7 bonded with thetransit peptide. The subject patent claims use of bacillus thuringiensisstrain and the development of two genes designated Cry2Aa and Cry2Ab.Each gene sequence is known for its ability to synthesize proteins withpesticidal properties. The NAS is not a living organism but a chemicalcreated in a laboratory. The “event” which is the positioning of theNAS at a unique location in the genome of a plant cell is a separate,subsequent and entirely different invention for which the plaintiffs have AB

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Aobtained a different patent no. 232681 and which is not the subject matterof the present suit. In this case, the invention is the NAS and the targetof the invention is its use in a plant cell. The property of the NAS iswhat makes the plant produce and localize the toxin protein in a specificlocation in the plant cell so as to make the toxin protein present throughoutthe plant, in pesticidal effective levels and still produce agronomicallyBstable plants. Relying on “Marker -Assisted RecurrentBackcrossing in Cultivar Development” by Guoyou et.al, it wassubmitted a NAS gene once inserted into a plant, was removable anddid not become part of the plant genome, to lose its patentablecharacteristics. These were matters to be considered in the suit on basisCof expert evidence.

10. Shri Vishwanathan and Shri Datar for the defendant haveadopted directly and mutually contradictory stands by contending thatclaims 25-27 are product claims, namely parts of a plant, and subsequentlythat the said claims are essentially biological process claims. Claims 1-D24 are not excluded under Section 3(j) being essentially biologicalprocesses as there exists significant human intervention. Dr. Singhvivery fairly admitted that he was not in a position to support the terminationof the sub-licence agreement and that the plaintiffs’ claims for licencefee/trait value had to be in accordance with the statutory price regime.The seeds from the plaintiffs’ patented technology were the highest sellingEcompared to similar other seeds. The plaintiffs have no intention to sueany Indian farmer for violation of patent. It was lastly submitted thateither this Court may remand the entire matter for adjudication of thepatent issue and infringement or decide the patent issue and then remandthe suit for other issues.F

11. Shri Kapil Sibbal contended that a chemical/gene/DNAconstruct is not a plant variety, and is not eligible for protection under thePPVFR Act. A gene cannot be a plant variety and it would be deniedsuch registration on account of lack of fulfillment of the conditionsprecedent in Section 2(za) read with Sections 14 and 15. A gene cannotGbe a “plant grouping”, “within a single botanical taxon of the lowestrank”, which in simple terms means that it cannot belong to the lowestrank of a plant, namely a species. The PPVFR Act came into effectfrom 2007 and in the last 11 years, no infringement action has been filedunder the same or injunction obtained. The department of bio-technologyon their official website has acknowledged the role agro-biotechnology H

has to play in feeding billion plus mouths in this country and the role that“novel genes” can play to deal with biotic and abiotic stresses, enhanceproductivity and nutritional quality.

12. Sri Neeraj Kaul submitted that the patented NAS is not thecreation of any biological process. The correct admixture of the promoter,the man made gene for the production of Cry2Ab endotoxin and the 3[rd]component for the production of the transit peptide leading to the DNAconstruct, is entirely the creation of the human intervention. The DivisionBench wrongly holds the invention to be a plant variety. It is only plantvarieties and seeds which are covered by the PPVFR Act. The PatentAct and the PPVFR Act are mutually exclusively.

13. Shri Vishwanathan leading the arguments on behalf of thedefendants submitted that no patent rights can be exercised with respectto genetically modified cotton planting seeds being developed by thedefendants through conventional breeding methods and sold to thefarmers. If the patent rights of the plaintiffs be accepted, then theregime provided under the PPVFR Act for plant intellectual propertywith respect to genetically modified plants would be entirely defeated.The plaintiffs’ claim was essentially of a “breeder” for developing avariety and therefore its donor seed containing the NAS was registerableunder the PPVFR Act and they were entitled to benefit sharing underSection 26 after such registration. No patent could be granted in a plant,or part of a plant, under Section 3(j) of the Act. Patent infringementanalysis involves two steps: the proper construction of asserted claimsand the determination as to whether the product infringes the assertedclaim as properly construed. The plaintiffs claim to patent was neverfor a chemical sequence in a vial. The plaintiffs’ claimed invention wasonly an improvement on prior art where it claimed that it had found away to have a plant produce a higher level of expression of the endotoxinprotein by localizing it to the plastid thereby reducing insect toleranceand at the same time producing morphologically normal plants. Theplaintiffs were also precluded from claiming rights onthegeneticallymodified Bt. cotton seeds on basis of prosecution history estoppel. Theorder of the Division bench being based on consent; it is not open for theplaintiffs to contend to the contrary now.

14. Shri Datar submitted that the “product” in claim 25-27 forNAS is a chemical is false, because any chemical that is inserted into a A

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Aplant is not capable of being passed on to the seeds of that plant and tothe future progeny as the chemical will be metabolized by the plant itselfand will never be transmitted to its seeds. Further, the NAS, by thewording of claims 25-27 itself, is a plant gene which is meant to be aninherent, intrinsic and integral part of the plant as it exists at the subcellular level. The cell after transformation with the gene through theBbiological process of tissue culture results in a transgenic plant thatproduces seeds having the essential characteristic of these transgenicplants. Therefore, claims 25 to 27 even if it represents merely a “gene”will manifest as an inseparable and inheritable part of a plant and cannotbe patented. The NAS gene inserted into the plant becomes anCinseparable part of the plant at the sub-cellular level by an irreversiblebiological process. It exists in every cell of the transformed plant. It notonly expresses in the plant to produce endotoxin but also inherits intoprogeny plants in perpetuity. It does not result in a “product” which canbe put into a vial and sold as such. The claims must be construed so as to give an effective meaning to each of them but the specifications andDthe claims must be looked at and construed together.

15. Shri Jayant Bhushan submitted that the plaintiffs did not bringthe NAS in a vial and but imported plants seeds containing NAS. Theseseeds were not protected by Patent. Indian seed companies were givendonor seeds which already had the NAS/Bt. Trait integrated in themEand was capable of germination. What the Indian Seed companies do isto cross one of the plaintiffs’ plants with the plants of their proprietaryIndian varieties suitable for cultivation in India, to develop a third/newcross-bred cotton variety which would have the Bt. trait from plaintiffs’variety so as to resist Bollworm and other traits from their own developedFvarieties. Since the Indian Seed Companies do not use the NAS inisolation nor do they use the method of introducing the NAS into theplant through the method described in the patent, there is no infringementof the patent. NAS is an essentially biological process in which thepatented product is neither separately used nor the patented process of

insertion into a plant is used, the NAS is not being made or used by theGIndian Seed Companies. The patent on a gene sequence in a test tubecannot negate/undo the important researchers’ and farmers’ rights underSections 30 and 39 of the PPVFR Act. Section 39 relates to Farmer’sRights entitling him to save, use, sow and re-sow his farmed produceincluding a registered variety protected under the Act. It was lastlyHsubmitted that if the Court is not inclined to uphold the order of the Division Bench, the matter may be remanded to the Division Bench forfresh hearing on the injunction matter because the correctness of theinjunction order dated 28.03.2017 never came to be tested or consideredby the Division Bench.

16. Shri Divan submitted that that there is no inventive step in theplaintiffs’ patent claim, until the artificial NAS is inserted into a plant sothat the plant starts producing the delta endotoxin which is toxic to theBollworms. There is no capability of industrial application of the NASexcept to become part of a plant and to develop a transgenic plant. Thethreshold requirements of an invention in terms of the patents Act aremissing until the implant stage. The inventive qualities begin when theNAS is inserted in a plant cell and not before that stage. Once, the NASis inserted in a plant cell, the exclusion under Section 3(j) applies and thePPVFR Act becomes operative.

17. Shri Venugopal submitted that a conjoint reading of Section2(j) and Section 3(c) of the Act makes it clear that it excludes patentabilityboth of transgenic plants (invented through recombinant gene technologyin the laboratory) and those invented through conventional breedingtechniques even where a new plant, variety or species is initially createdthrough genetic manipulation, to the extent that the subsequent productionor propagation of the plant, variety or species is done through “anessentially biological process”, the biological process would not bepatentable under Section 3(j) of the Act. Even if patent exclusion underSection 3(j) was not applicable, still the patent claim could never permitplaintiffs to claim the right to prevent farmers from making, using, offeringfor sale or selling plants or seeds of the cotton plant that contain Bt.gene. The patent of an artificial gene and the process for inserting it intothe genome of a plant, will not entitle the exercise of rights under Section48 of the Act in respect of a plant that contains the artificial gene onwhich it has a patent. The protection under Section 48 of the Act iscapable of being exercised against other biotechnology companies thatseek to replicate the Bt. gene product or the process of insertion of thatgene in the genome of the cotton plant. Both the Patents Act and PPVFRAct have a link that is to protect the interests of the farmers so that theyare not burdened by exorbitant rates of seeds.

18. Shri Prashant Bhusan, Shri Sanjiv Sen, and Smt. AnanditaMitra on behalf of the interveners submitted that the NAS is not “capableof industrial application” unless it becomes a part of the plant cell where A

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Ait is expressed by the plant cell through essentially biological processesof transcription, translation, and replication, to produce the desired protein.The Biodiversity Act which prohibits the “use” of any biological resourcesoccurring in India for commercial utilisation and which includes genesused for improving crops and livestock through genetic interventionnecessitates prior permission from the National Bio Diversity AuthorityBwhich has not been taken by the plaintiffs. The NAS only adds a trait toa plant leading to development of a transgenic variety creating donorseeds. The seeds are not patentable under Section 3(j) of the Act thoughthe plaintiffs may be entitled for benefit sharing under the provision ofthe PPVFR Act as defined under Section 2(h) of the PPVFR Act. TheCclaim of the plaintiffs has ramifications beyond the immediate parties.

19. We have considered the respective submissions made on behalfof the parties. Though very elaborate submissions have been madewith regard to facts and the technical processes involved in the patent inquestion, the provisions of the Act, the PPVFR Act and a large volumeDof case laws for construction of patents, the obligations under the WorldTrade Organisation (WTO), General Agreement on Tariffs and Trade(GATT), Trade-Related Aspects of Intellectual Property Rights (TRIPS)Agreement, leading to the Patents Amendment Act, 2002 on 25.06.2002,in view of nature of the order proposed to be passed, we do not considerit necessary to deal with the same at this stage, and leave open allEquestions of facts and law to be urged for consideration in appropriateproceedings.

20. The patent claims 1-24 are with regard to the processes whileclaims 25-27 are with regard to the chemical product called NAS.According to the plaintiffs, the latter was a man-made DNA constructFthat did not exist in nature and did not otherwise form part of a plantexisting in nature. The DNA construct was inserted into a plant whichconfers the trait of insect tolerance to the plant. It comprises of threedifferent components i.e. (i) A promoter, (ii) A gene for the production ofCry2Ab 5-endotoxin and (iii) a third component for the production of aGtransit peptide. Of these three, Cry2Ab 5-endotoxin is stated to be aman-made gene. This nucleic acid sequence is then inserted into thecell of the plant at a particular location resulting in the production of “afusion protein” which comprises the Cry2Ab 5-endotoxin 7 bonded withtransit peptide. The production of a fusion protein is critical in this respect H

for the technology to be effected in plants. The bacillus thuringiensisstrain does not produce such a fusion protein. It is the plaintiffs’ claimthat it is only its technology that allows a cotton plant to produce theCry2Ab 8-endotoxin protected inter-alia by claims 25-27 of the patentedinventions. The subject patent claims the use of Bacillus thuringiensisstrain and development of two genes designated Cry2Aa and Cry2Ab.Each gene sequence is known for its ability to synthesize proteins withpesticidal properties.

21. It is the contention of the defendants apart from theunpatentability of the plaintiff’s claim, they have not violated patentedrights, if any, as:

“a) Nuziveedu sowed seeds of their proprietary cotton varietiesalongside the Transgenic Bt. Cotton seed.

b) The Transgenic Bt. Cotton seed and the Nuziveedu’s varietiesseed yielded different plants, which were cross-pollinated at theflowering stage.

c) The cotton fruits from the Nuziveedu’s cotton varieties hadcotton seeds, which were carrying the proprietary hybrid (“Bt.cotton hybrids”)

d) Nuziveedu conducted extensive agronomic evaluation trials ofnewly developed Bt. Cotton Hybrids to ascertain their utility tothe farmers.

e) Nuziveedu obtained the approval of the GEAC under theEnvironment (Protection) Act, 1986 for the commercial releaseof each new Bt. Cotton Hybrid which were consideredsatisfactory after internal evaluation, and thereafter produced inmass scale and distributed to the farmers.”

22. Manifestly, the counter claim of the defendants was neverconsidered by the learned Single Judge as only notice had been issuedon the same. The plaintiffs had preferred an appeal against the natureof the injunctive relief with regard to the issue of licence fee/trait value,now conceded by the plaintiffs. We see no reason to reject the submissionof Dr. Singhvi that it stands to reason why the plaintiffs would haveconsented to a summary adjudication of an existing patent and risk losingthe same without any merit adjudication. The defendants themselves AB

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Ahad contended in their appeal that the issues were complicated requiringexpert evidence to be considered in a full-fledged trial. The DivisionBench therefore ought to have confined its adjudication to the questionwhether grant of injunction was justified or unjustified in the facts andcircumstances of the case. The Division Bench ought not to haveexamined the counter claim itself usurping the jurisdiction of the SingleBJudge to decide unpatentability of the process claims 1-24 also in thesummary manner done. Summary adjudication of a technically complexsuit requiring expert evidence also, at the stage of injunction in the mannerdone, was certainly neither desirable or permissible in the law. The suitinvolved complicated mixed questions of law and facts with regard toCpatentability and exclusion of patent which could be examined in the suiton basis of evidence.

23. Section 64 of the Act provides for revocation of patent basedon a counter claim in a suit. It necessarily presupposes a validconsideration of the claims in the suit and the counter claim in accordanceDwith law and not summary adjudication sans evidence by abstractconsideration based on text books only. The Civil Procedure Codeprovides a detailed procedure with regard to the manner in which a suitinstituted under Section 9, including a counter claim has to be consideredand adjudicated. The Code mandates a procedure by settlement of issues,examination and cross examination of witnesses by the parties, includingEdiscovery/inspection of documents, culminating in the hearing of the suitand decree. A suit can be disposed of at the initial stage only on anadmission inter alia under Order 12 Rule 6 or when the parties are not inissue under Order 16 Rule 1 and the other grounds mentioned therein,none of which are applicable herein. We are therefore satisfied that theFDivision Bench ought not to have disposed of the suit in a summarymanner by relying on documents only, extracted from the public domain,and not even filed as exhibits in the suit, much less examination of expertwitnesses, in the facts of the present case. There is no gain saying thatthe issues raised were complicated requiring technological and expert evidence with regard to issues of chemical process, biochemical,Gbiotechnical and micro-biological processes and more importantly whetherthe nucleic acid sequence trait once inserted could be removed fromthat variety or not and whether the patented DNA sequence was a plantor a part of a plant etc. are again all matters which were required to beconsidered at the final hearing of the suit.H

MONSANTO TECHNOLOGY LLC v. NUZIVEEDU SEEDS LTD.[NAVIN SINHA, J.]

24. The manner in which a suit instituted under Section 9 of theCode is required to be dealt with and decided, fell for consideration inAlka Gupta vs. Narender Kumar Gupta, (2010) 10 SCC 141, observingas follows:- “27. The Code of Civil Procedure is nothing but an exhaustivecompilation-cum-enumeration of the principles of natural justicewith reference to a proceeding in a court of law. The entire objectof the Code is to ensure that an adjudication is conducted by acourt of law with appropriate opportunities at appropriate stages.A civil proceeding governed by the Code will have to be proceededwith and decided in accordance with law and the provisions ofthe Code, and not on the whims of the court. There are no short-cuts in the trial of suits, unless they are provided by law. A civilsuit has to be decided after framing issues and trial permitting theparties to lead evidence on the issues, except in cases where theCode or any other law makes an exception or provides anyexemption.

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30. But where the summons have been issued for settlement ofissues, and a suit is listed for consideration of a preliminary issue,the court cannot make a roving enquiry into the alleged conductof the plaintiff, tenability of the claim, the strength and validity andcontents of documents, without a trial and on that basis dismiss asuit. A suit cannot be short-circuited by deciding issues of factmerely on pleadings and documents produced without a trial.

31. In this case, the learned Single Judge has adjudicated anddecided questions of fact and rendered a judgment, withoutevidence tested by cross-examination….”

25. The Division Bench ought to have confined itself to examinationof the validity of the order of injunction granted by the learned SingleJudge only. But we are not inclined to remand the matter for that purposeto the Division Bench as we are satisfied in the facts and circumstancesof the case that the nature of the injunctive relief granted by the SingleJudge was in order and merits no interference during the pendency ofthe suit.

A

BC

D

E

FG

H

A26. The order of the Division Bench is set aside. The order of theSingle Judge dated 28.03.2017 is restored and the suit is remanded tothe learned Single Judge for disposal in accordance with law. In view ofthe importance of the question involved, we expect the parties tocooperate and facilitate the learned Single Judge in early disposal of thesuit.

B

27. The appeals and the intervention applications stand disposedof.

C

Kalpana K. Tripathy

Appeals disposed of.

D

E

F

G

H