Introduction: The present case arises out of a dispute between Vishal Gupta and others on one side, and Rahul Bansal on the other, concerning alleged passing off and deceptive similarity in the use of trademarks related to edible oil products. The case, which reached the Delhi High Court by way of a First Appeal under Order XLIII CPC, centers around an interim injunction granted by the Commercial Court. The High Court was called upon to assess whether the injunction was legally sustainable, particularly when the respondent-plaintiff did not hold a registered trademark.
Detailed Factual Background: Rahul Bansal, the plaintiff before the learned Commercial Court, sought to restrain Vishal Gupta and others, who were the defendants in the original suit, from using the trademarks "OM AMAR SHAKTI" and "SARKAR OM AMAR SHAKTI" for selling mustard oil. The plaintiff claimed that the defendants' marks were deceptively similar to his mark "MATA AMAR SHAKTI", and that such use by the defendants would amount to passing off.
However, the plaintiff's mark "MATA AMAR SHAKTI" was not registered under the Trade Marks Act, 1999, although he possessed copyright registration for the label associated with the mark. The plaintiff contended that he had prior user rights over the mark and that the defendants were attempting to misappropriate the goodwill he had built around his label. Based on this assertion, he sought an injunction to prevent the defendants from using their respective marks.
Detailed Procedural Background: The Commercial Court at Tis Hazari, New Delhi, adjudicated on three applications together: the plaintiff's application under Order XXXIX Rules 1 and 2 CPC for interim injunction, and two applications filed by the defendants—one under Order VII Rule 11 CPC seeking rejection of the plaint, and another under Order VII Rule 10 CPC seeking return of the plaint for want of jurisdiction.
The Commercial Court vide order dated 5 March 2025 granted the injunction sought by the plaintiff and restrained the defendants from using the marks "OM AMAR SHAKTI" and "SARKAR OM AMAR SHAKTI". Aggrieved by this injunction order, the defendants preferred FAO (COMM) 103/2025 before the Delhi High Court, limiting their challenge only to the part of the order that pertained to the injunction under Order XXXIX Rules 1 and 2 CPC.
Issues Involved in the Case: The principal issue before the High Court was whether the Commercial Court erred in granting an injunction for passing off in favour of the plaintiff who did not possess a registered trademark, and whether the ingredients for sustaining a passing off action had been properly considered? A secondary issue was whether mere priority of user could justify a finding of passing off without proof of goodwill, misrepresentation, and damage?
Detailed Submission of Parties: The appellants submitted that the injunction granted by the Commercial Court was legally unsustainable because the respondent did not hold a registered trademark and had failed to establish the essential elements of a passing off action. It was contended that the injunction had been granted solely on the basis of alleged prior use, without any supporting evidence of acquired goodwill, misrepresentation by the defendants, or damage to the respondent.
The respondent candidly admitted that the trademark was not registered. However, he argued that the respondent was still entitled to protection under the common law tort of passing off. He placed reliance on the principle that a passing off action could be maintained by a prior user regardless of registration and invoked multiple Supreme Court judgments supporting the same.
Detailed Discussion on Judgments Along with Their Complete Citation Cited by Parties and Their Respective Context Referred in This Case: The respondent placed reliance on the judgment in Brihan Karan Sugar Syndicate (P) Ltd. v. Yashwantrao Mohite Krushna Sahakari Sakhar Karkhana, (2024) 2 SCC 577. The Supreme Court in this case reaffirmed that in a passing off action, the plaintiff must establish three elements: (i) goodwill, (ii) misrepresentation leading to deception, and (iii) actual or likely damage. The Court emphasized that priority of use alone was insufficient unless goodwill and confusion were also proven.
The principles were further elaborated by citing Satyam Infoway Ltd. v. Siffynet Solutions (P) Ltd., (2004) 6 SCC 145, which clarified that in a passing off claim, the plaintiff must demonstrate that the defendant's use of the mark is likely to deceive the public into believing that the defendant's goods are those of the plaintiff.
The Court also referred to Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd., (2018) 2 SCC 1, and S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, which collectively affirmed that registration of a trademark is irrelevant for a passing off claim based on prior user. Furthermore, the House of Lords’ decision in Reckitt & Colman Products Ltd. v. Borden Inc., (1990) 1 WLR 491 (HL), was approved in these cases, where it was held that reputation, misrepresentation, and damage form the triad of requirements in a passing off suit.
Despite these precedents, the High Court found that the Commercial Court had failed to assess these essential elements and had granted the injunction solely based on prior user without examining whether the respondent had established goodwill, misrepresentation, or damage.
Detailed Reasoning and Analysis of Judge: The Division Bench held that the impugned order of the Commercial Court was legally flawed. It was observed that the order did not discuss or evaluate the essential ingredients of a passing off action—particularly the presence of goodwill or reputation associated with the mark "MATA AMAR SHAKTI".
The Court pointed out that priority of use, by itself, does not justify an injunction. In order to grant interim relief in a passing off action, courts must be satisfied not only of the plaintiff’s prior use but also of misrepresentation by the defendant and likelihood of damage. None of these were adequately discussed or proven before the Commercial Court.
The Court further noted that even the respondent’s counsel accepted the fundamental omission and expressed willingness to have the matter remanded. Accordingly, the Court exercised its appellate jurisdiction to correct the procedural and legal error committed by the Commercial Court.
Final Decision: The Delhi High Court allowed the appeal to the extent of setting aside the portion of the Commercial Court's order that granted injunction under Order XXXIX Rules 1 and 2 CPC. The matter was remanded to the learned Commercial Court for a fresh decision after examining the case on merits, particularly the ingredients of a passing off claim.
Law Settled in This Case: This judgment reinforces the well-established principle that for a successful passing off action, the plaintiff must establish three crucial elements: goodwill associated with the mark, misrepresentation by the defendant, and resultant damage or likelihood of it. Mere prior use of a mark is not enough to secure an injunction unless these ingredients are present. It also reiterates that in the absence of a registered trademark, a claim for infringement is not maintainable under Section 28 and 29 of the Trade Marks Act, 1999. The decision underscores the responsibility of courts to conduct a thorough analysis of these components before granting interim relief in trademark disputes.
Disclaimer:The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.
Written By: Advocate Ajay Amitabh Suman,IP Adjutor [Patent and Trademark Attorney] ,High Court of Delhi
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