Demarcating the Boundaries: The Supreme Court’s Twin Test for Resolving Copyright and Design Conflicts Under Section 15(2)

Resolving Copyright and Design Conflicts

The intersection between copyright and design law has long been a contentious and evolving area within Indian intellectual property jurisprudence. At the heart of the debate lies a fundamental tension: how to balance the enduring protection offered by copyright for original artistic expressions with the more limited, utilitarian protection granted to designs intended for industrial application. This overlap has posed practical challenges for courts, especially when determining whether a work initially protected as an “artistic work” under the Copyright Act, 1957, loses that protection once it is adapted for commercial manufacturing and becomes capable of design registration under the Designs Act, 2000.

The recent judgment of the Supreme Court in Cryogas Equipment Pvt. Ltd. & Anr. v. Inox India Ltd. marks a watershed moment in resolving this doctrinal ambiguity. The Court, while adjudicating an appeal from an interlocutory order arising from a commercial suit involving the design and manufacture of cryogenic LNG storage systems, has laid down a definitive “twin test” to determine when copyright protection ceases to subsist in an artistic work that is also capable of being treated as a design.

The case stems from allegations of copyright infringement by Inox India Ltd., who claimed unauthorized use of its engineering drawings and associated technical literature by Cryogas Equipment Pvt. Ltd. and its affiliate. The core legal issue concerned whether Inox’s engineering drawings, which had allegedly been industrially applied in the manufacture of over fifty LNG semi-trailers, could continue to enjoy copyright protection or whether such protection was barred under Section 15(2) of the Copyright Act.

Through its ruling, the Supreme Court not only affirmed the need for a fact-intensive, case-specific assessment before rejecting such suits at the threshold but also provided doctrinal clarity by articulating a structured two-pronged approach for assessing the overlap between copyright and design rights. The decision carries significant implications for stakeholders in sectors such as industrial design, engineering, fashion, and manufacturing—where creative outputs often straddle the line between aesthetic expression and functional utility.

This article examines the factual matrix of the case, analyzes the Court’s reasoning, and explores the broader legal and commercial ramifications of the “twin test” framework established by the Supreme Court.

Statutory Background:

Section 15(2) of the Copyright Act reads as follows:

“Copyright in any design, which is capable of being registered under the Designs Act 2000, but which has not been so registered, shall cease as soon as any article to which the design has been applied has been produced more than 50 times by an industrial process.”

Section 15(2) of the Copyright Act stipulates that if an artistic work, capable of being registered under the Designs Act, 2000, is applied to more than 50 articles through an industrial process without registration, the copyright protection ceases.

Yet, over time, confusion has persisted regarding what qualifies as a “design” and when copyright ceases. This new ruling addresses that.

The Supreme Court’s Twin Test

The Supreme Court, addressing ambiguities in this legal framework, laid down a two-pronged approach

1. Nature of the Work: Determine whether the work is purely an ‘artistic work’ protected under the Copyright Act, or a ‘design’ derived from such a work and subjected to industrial application. This means that the court must first examine whether the work is an original artistic expression, or whether it constitutes a design derived from such artwork that has been utilized in a mass-production or industrial manufacturing context.
2. Functional Utility: If the work does not qualify for copyright protection, assess its dominant purpose. If the primary characteristic is functional utility rather than aesthetic appeal, it would not qualify for protection under the Designs Act. The aim is to assess whether the primary intent of the work lies in its artistic appeal or its practical utility. In essence, an artistic work may initially qualify for copyright protection, but if it is repeatedly reproduced and primarily utilized for functional or commercial purposes, it may forfeit copyright protection and instead fall within the ambit of design law.

Background of the case

Inox India Limited (Inox) filed a lawsuit against Cryogas Equipment Private Limited (Cryogas) and LNG Express India Private Limited (LNG Express), claiming copyright infringement. The core of Inox’s claim was that Cryogas and LNG Express had improperly used its proprietary engineering drawings and literary works related to the design and manufacture of cryogenic storage tanks and distribution systems for transporting LNG and other industrial gases. Inox developed these drawings to meet specific storage and transportation needs. In its lawsuit, Inox requested a declaration of infringement, injunctions against further use or reproduction, the surrender and destruction of infringing materials, and damages of Rs. 2 Crores. Countering this, LNG Express asserted that the drawings were “designs” as defined by the Designs Act, 2000, and thus not protectable by copyright under the Copyright Act, 1957. LNG Express further contended that Section 15(2) of the Copyright Act barred Inox’s copyright claims because the designs had been industrially reproduced more than fifty times.

The Supreme Court upheld the Gujarat High Court’s refusal to allow the appellants’ application under Order VII Rule 11 of the Civil Procedure Code (CPC), thereby reviving Inox India Limited’s suit for copyright infringement. The Commercial Court had initially dismissed the suit at the threshold, holding that Section 15(2) of the Copyright Actbarred copyright claims once a design had been reproduced more than fifty times through an industrial process.

However, the High Court found the dismissal to be premature, noting that:

• Whether the impugned drawings constituted copyrightable artistic works or registrable designs was a matter requiring detailed factual scrutiny;
• Even assuming registrability under the Designs Act, the question of whether Inox had applied the works to more than fifty articles involved a mixed question of law and fact, unsuitable for rejection at the preliminary stage;
• Additional allegations concerning the misappropriation of confidential information, literary works, and technical know-how warranted further examination and could not be summarily dismissed on the pleadings alone.

Affirming the High Court’s reasoning, the Supreme Court emphasized the need for a nuanced, context-specific approach before rejecting such claims at the outset. Importantly, the Court laid down a two-pronged test to assess the interface between copyright and design protection and directed the Commercial Court to proceed with the suit, including the adjudication of the pending injunction application, within a prescribed timeline.

Significance of the Judgment

1. Harmonization of IP Law: The ruling harmonizes the objectives of the Copyright Act and the Designs Act, recognizing the mutually exclusive roles played by these legislations in protecting creative and industrial works respectively.
2. Curbing Dual Protection: The judgment reinforces the legislative bar on dual protection, preventing misuse of copyright law to extend monopoly over commercial products that are otherwise meant to be governed by time-bound design rights.
3. Commercial and Policy Impact: This ruling is likely to influence practices in several creative industries such as fashion, furniture, consumer goods, packaging design, and more, where artistic elements are routinely applied to mass-produced articles.
4. Doctrinal Clarity for Lower Courts: The twin test provides a clear doctrinal framework for lower courts and tribunals to apply in future cases, reducing judicial inconsistency and aiding in faster resolution of disputes.

Conclusion

The Supreme Court’s decision in Cryogas Equipment Pvt. Ltd. & Anr. v. Inox India Ltd. provides critical doctrinal clarity on the complex interplay between copyright and design protection under Indian law. By introducing the “twin test”, the Court has established a structured and principled approach for determining when copyright protection ceases for works that are capable of being registered as designs but have not been so registered. This judicial development is particularly important considering the increasing convergence between artistic creativity and industrial application across a wide range of sectors.

The ruling reinforces the legislative intent behind Section 15(2) of the Copyright Act, 1957, which seeks to prevent the overextension of copyright protection to works that are more appropriately governed by the Designs Act, 2000. It draws a clear line between artistic works meant for aesthetic appreciation and designs meant for commercial replication, ensuring that rights holders do not gain undue and prolonged monopolies over industrial products through copyright law.

Written by Medha, Legal Intern at Intepat IP