Case Name: Cryogas Equipment Private Limited vs Inox India Limited

Citation: Cryogas Equip. Pvt. Ltd. v. Inox India Ltd., 2025 INSC 483 (India Apr. 15, 2025).

Court: Supreme Court

Corum:  Justice Surya Kant

Abstract

Cryogas Equipment Private Limited v. Inox India Limited is a Supreme Court judgment that addresses the intersection which has been contested for a long time, which is between copyright protection for engineering drawings and design registration under the Indian Intellectual Property Law. The Supreme Court laid down a two-pronged test that determines whether an industrial drawing qualifies as an ‘artistic work’ under section 2(c) of the Copyright Act,1957 or a registrable ‘design’ under section 2(d) of the Designs Act,2000, with reference to the limitation imposed by section 15(2) in particular.

Introduction

The Supreme Court in Cryogas Equipment Private Limited v. Inox India Limited addresses the question of when does an engineering drawing become a registrable industrial design and stops being as a copyrightable artistic work for the very first time at the apex level. This ruling provides the industries who rely on proprietary engineering drawings like cryogenic equipment, automobile components and industrial machinery, one of the clearest judicial guidance. However, the appeals in this case were ultimately dismissed with the matter being remanded for a trial under the newly articulated two-pronged test.

Facts

Inox India Limited had invested a significant amount of effort in developing the proprietary engineering drawings for LNG semi-trailers, with the purpose of building designs which are engineered to meet the road conditions of India and having regulatory requirements for transporting cryogenic liquids. These drawings represented the industrial designs which were carefully developed in order to incorporate shape, configuration, and process specifications. Inox alleged Cryogas Equipment Private Limited and LNG Express India Private Limited which were established by people who were associated with Inox in the past misappropriated its proprietary drawings, literary works detailing manufacturing processes, and confidential know-how. Inox disclosed that it had earned Rs.122 crore in revenue, which implies that its manufacture exceeded the critical fifty-reproduction threshold under section 15(2) of the Copyright Act, and this potentially extinguishes the copyright protection entirely.

Issues

1.     What are the parameters that determine whether an industrial drawing is a ‘design’ under s.2(d) of the Designs Act,2000 or an ‘artistic work’ under s.2(c) of the Copyright Act.1957?

2.     Whether engineering drawings for internal components which are not the visible parts that lack aesthetic appeal qualifies as a registrable design?

Reasoning

On issue 1:
The court affirmed that the definition of ‘artistic work’ under Section 2(c) of the Copyright Act has a very wide meaning which qualifies abstract lines but says that the aesthetic quality is irrelevant. However, the inquiry generally shifts once such a work is applied industrially. The court formulated a two-pronged test based on Delhi High Court’s Microfivres II line. The first is to determine whether the work is purely an artistic work or it is a design that is derived from it, and it is applied through an industrial process. Second is if the latter, apply the functional utility test to assess design registrability. The court then confirmed that the original drawing and the design which is derived from it are legally distinct, and the copyright in the original drawing survives even if the derived design loses its protection upon crossing fifty reproductions.

On issue 2:
The court in this issue engaged with the functional utility test that originated in the House of Lords’ decision in Amp v. Utilux and was adopted in India through Smithkline Beecham v. Hindustan Lever. This test excludes the protection of a product’s shape or design if it exists only for functional purposes without having any visual appeal. When the functional test was applied to Inox’s drawings of internal cryogenic vessel components, it raised a significant question that the components which remain completely concealed in the finished product would never satisfy the requirement of visual appeal under section 2(d) of the Designs Act. The court held that such a classification involves mixed questions of law and fact that requires a full trial and an Order VII Rule 11 application is not an appropriate stage for determining it.

Critique

There exists three problems that limits clarity of the two-pronged test. First, is that the Court treats the question of visual-appeal for the concealed internal components as a question of fact for trial, whereas the Delhi High Court in Microfibres had resolved the question of analogous severability without needing a trial at the preliminary stage and suggested that the test is quite hard to apply ex ante that what the judgment implies. Second, is that the functional utility test that is borrowed from Amp v. Utilux has been diluted to the point that it is now considered irrelevant due to the Whirlpool gloss that has implied that a shape becomes non-functional if any of the alternative shapes could serve the same purpose, it is a standard that is so easy to match that no design would ever fail as the alternative engineering solutions almost always exist. Third, is that if we direct the court to apply “Occam’s Razor”, it would not offer any workable metric and it would pose a risk of inconsistent outcomes across all of the future design disputes.

Impact

This ruling by the Supreme court carries practical consequences which have to be acted upon immediately for design-intensive industries. Manufacturers that rely on engineering drawings have to immediately audit their IP portfolios, registering drawings for visually applied, aesthetically discernible features under the Designs Act before it crosses the fifty-reproduction threshold, and if they fail to do so, they will lose their copyright protection entirely. The copyright of the original drawing may survive for the purely functional internal components but this has to be established through litigation under the newly articulated test. This judgment very firmly signals that registration is not a procedural formality but it is the only reliable way to get protection for the commercially exploited designs.

Conclusion

The Supreme Court through Cryogas v. Inox develops for the first time a structured test at the copyright-design interface that binds every court below. However, the most consequential question still remains: when the Commercial Court finally determines the legal status of Inox’s proprietary drawings, it will then reveal if the two-pronged framework actually delivers the clarity that it promises. Additionally, this ruling exposes the legislative gap that India lacks a sui generis protection framework for functional industrial designs akin to the European Union’s Unregistered Community Design right, a gap that the Parliament has to do well to fill.

References

Cryogas Equipment (P) Ltd. v. Inox India Ltd. (2025) INSC 483

Microfibres Inc. v. Girdhar & Co. (2009) 40 PTC 519 (Del)

Amp Incorporated v. Utilux Pty Ltd. (1972) AC 103 (HL)

Smithkline Beecham Plc. v. Hindustan Lever Ltd. (2000) PTC 83 (Del)

Whirlpool of India Ltd. v. Videocon Industries Ltd. (2014) 60 PTC 155 (Bom)

The Copyright Act, 1957

The Designs Act, 2000