Court Fee In Delhi: Increased or DECREASED For IP Matters?

A little background:

Government of NCT of Delhi issued a notification on July 23, 2012 bringing into force the Court Fee (Delhi Amendment) Act, 2012. The notification increased the Court Fee applicable in Delhi since August 01, 2012.

In Schedule I dealing with Ad Valorem Fees, few significant changes in the civil suits–for written statements too–and  cheque bouncing cases by the notification are the following: –

  1. Upto fifty thousand rupees–two percent on such amount or a thousand rupees as fixed fee, whichever is more;
  2. From fifty thousand rupees to twenty lakh–three percent on such amount or value; and
  3. Above twenty lakhs–four percent on such amount.

As expected, the fixed fee on the written statements and the fees for the cheque bouncing cases of higher amount were the biggest sufferers. Imagine a situation where a person has bounced cheques worth 4 million. His court fee alone before the Magistrate shall be one hundred and sixty thousands in the notification.

It is true that some fees needs to be increased in some segments but no increase should have happened, as presently, without keeping in mind the paying capacity of a litigant.

Since the notified Schedules increased Court Fee substantially across the board, Delhi High Court Bar Association (DHCBA) filed a writ petition in the High Court of Delhi and obtained a stay on the notification on August 9, 2012. During the course of this writ petition, it came to be known that the Govt approached the Supreme Court by filing a Special Leave Petition against the stay order. Their Honours sitting in the Supreme Court, on September 26, 2012, vacated the stay granted by the High Court. Meaning thereby, the notification would prevail.

However, later on DHCBA appeared before the Supreme Court and apprised the Bench their view. On October 16, SC modified the earlier order dated September 26 only to the extent that the written statements will not have the fixed fee and the cheque bouncing cases would go on with the earlier fees.

The Bench disposed off the SLP on October 30 requesting the High Court to decide the writ petition at the earliest.

With this background, let us see one branch of the civil suits pending in the High Court–intellectual property (IP) matters pertaining to actions for infringement of patent, design, copyright and trademark. In the Schedule II to the notification detailing the fixed fee, at Article 30, following are the charges specifically for the IP suits: –

  1.  When filed before a Civil Judge–five hundred rupees;
  2. When filed before a District Judge–one thousand rupees; and
  3. When filed before the High Court–five thousand rupees.

Though the first entry is GRAVELY flawed since the IP matters can never be filed before a Civil Judge. The District Court is the first instance Court for IP matters.

Coupled with the enhanced fees for the applications, vakalatnama (form of authorisation for an advocate to appear) and other sundry charges–not to forget 4 percent on 2 million (eighty thousand) and five thousand rupees as fixed fee, counsels were affixing fees close to ninety thousands for IP actions. It is not difficult to imagine that fresh filing would have surely taken a beating.

Since the notification came into force and effect from August 01, 2012, the counsels were also required to make up deficient court fee in the suits filed after this date.  Article 30 states that suit and or petitions will require fixed fees of five thousand rupees. The counter claims were always filed with the fees proportionate to the amount claimed. Same is happening as of now too except for the fixed fees.

Last week, on December 7, 2012, to the Author’s knowledge–subject to correction–His Honour Mr. V. K. Jain, in a civil suit admitted a fresh civil action with only ten thousand rupees as court fees. Now, a very seasoned and distinguished intellectual property attorney filed this suit. I’m sure that the ever so generous counsel will share some details to enlighten me. Though I understand that some counsels are now filing suits with only Schedule II fees.

The order is available here.

Following is an extract of the order: –

As per Article 30 of Schedule II to the Court Fee Act, as applicable to Delhi, in any suit or petition under the Intellectual Property Rights, the court fee required to be paid is Rs.5,000/- when the suit or petition is filed before the High Court. Since this is a suit seeking to enforce Intellectual Property Rights of the plaintiff Company, it is clearly governed by the aforesaid Article and accordingly requisite court fee stands already paid.

What I, as a counsel practicing intellectual property law myself, do not understand is how come the ad valorem fee (in Schedule I) gets a waiver. The said Article nowhere says that the counter claims, of whatever amount, shall not require ad valorem fees. Why sudden exemption to plaints then? My limited understanding of the notification and the Schedules nowhere tells me that the Schedule I is, henceforth, inapplicable to IP matters. If it is, then the Govt should rectify it to remove the anomaly since we were, earlier, filing even IP matters with the increased Court fees.

The Schedule II is in addition to or rather an exemption from Schedule I requires clarity.

My senior colleagues in the Bar will agree with me that, invariably, cash rich companies file cases to protect their intellectual property. If the idea of the Government was to give these companies some exemption so to say then same logic should apply to every citizen who is approaching the High Court after, presently, arranging mammoth Court Fees and resources.

I am again stressing everyone to read the increased jurisdiction note and enlighten me with their thoughts for me to gain knowledge on this critically important segment in my area of practice.

I am sure in times to come, I will be able to get more clarity since, as of now, I have very little.

Suggestions welcome.

4 Comments

Filed under In Accordance With Law, IP reviews, Uncategorized

4 responses to “Court Fee In Delhi: Increased or DECREASED For IP Matters?

  1. Pradyuman

    I think that the ad valorem component stays. For satisfying pecuniary jurisdiction of the Delhi High Court, the suit has to be valued above Rs. 20 Lakhs and ad valorem court fee on the same will need to be paid. If the valuation of the suit is below Rs. 20 Lakhs, it will not lie before the High Court. However, it is for the Defendant in the said suit to address this aspect.

  2. Pingback: Resolving IP Infringement Lawsuits: Swifter. | Dushyant K. Mahant's Blog

  3. jayavel

    please note TN charges 7.5 percent advolerm on mointory claims for past decade

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