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IN THE
HIGH COURT OF DELHI AT NEW DELHI
+
Date of decision :1st October, 2018 CS (COMM) 1417/2016
M/S. VINI COSMETICS PVT. LTD. .....
Plaintiff
Through: Mr. Ajay Amitabh Suman, Mr.
Pankaj Kumar
and Mr. Kapil
Giri,
Advocates.
(M:9990389539)
versus
M/S. ABHAY ENTERPRISES & ORS. .....
Defendants
Through: Ms. Pratishtha Vij, Mr. P.
Hansranjan
and Mr.
Prawal, Advocates for D-1.
(M:9971919461)
CORAM:
JUSTICE PRATHIBA M. SINGH
Prathiba M. Singh, J. (Oral)
1.
Plaintiff has filed the present
suit for permanent injunction restraining passing off, infringement of
trademark, infringement of copyright, rendition of accounts etc. The case of
the Plaintiff is that it is engaged in the manufacturing and marketing of
various kinds of cosmetics and proprietary products, lotions, talcum powder,
powder (make up), creams, deodorant, styling gel, perfume, shaving cream, soap,
shampoo, bleaching preparations etc.
2.
One of the products being
manufactured and sold by the Plaintiff is the „GLAM-UP LABEL‟ powder cream in a distinctive red coloured
packaging. It is the case of the Plaintiff that the mark and label was adopted
by it in September, 2012 and the same has been in use since August, 2013. It
has applied for registration, in various classes for the word-mark and
label-mark.
3.
The
Plaintiff came to
know that Defendant
No.1 – M/s
Abhay
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1417/2016 Page 1 of 7
Enterprises had started using an identical mark and
carton and imported the same from foreign countries. According to the
Plaintiff, Defendant No.1 is not only selling the products at its own outlets
but also supplying the same to various dealers and retailers. It is the case of
the Plaintiff that the information about Defendant No.1 was revealed when the
Commissioner of Customs, Mumbai sent a notice dated 2nd April, 2014 to one of the
manufacturers, who was manufacturing and supplying the products to the
Plaintiff. The customs authorities informed the manufacturer about the arrival
of a consignment of 14,400 pieces of GLAM-UP
POWDER CREAM products at the customs and called upon the Plaintiff‟s
manufacturer to furnish the requisite security bond and bank guarantee so that
the said counterfeit products could be detained. The Plaintiff was then
informed by its manufacturer, who took steps to file the present suit against
the Defendants.
4.
In the present suit, the
Plaintiff has impleaded Abhay Enterprises as Defendant No.1 as also the customs
authorities as Defendant Nos.2 & 3.
Vide order dated 20th August, 2014 this Court granted
an ex-parte injunction order in favour of the Plaintiff. On 5th November, 2014 the said
injunction was also confirmed. On 1st December, 2014, the Court recorded the
Defendant
No.1‟s statement as under:
“Learned
counsel for the defendants submit that defendants
are willing to suffer a decree provided the plaintiff gives up the relief of
damages.”
5.
On the next date i.e. 2nd December, 2014, learned counsel
for the Plaintiff reverted with instructions and submitted as under:
“Counsel for the plaintiff submits
that in case defendants pay
reasonable costs and damages and also
CS (COMM)
1417/2016 Page 2 of 7
agree for destruction of the
seized goods, he will instructions from his client.”
6.
Thereafter, there were some
objections raised by the Defendant No.1 that one Mr. Mahesh Thakkar had misused
its IEC (Import Export Code) and imported the goods without its permission. The
Defendant No.1 delayed in filing the written statement and costs also were
imposed. Finally, the written statement was taken on record vide order dated 23rd February, 2017.
7.
On 14th September, 2018, a new counsel
was engaged and adjournment was sought to seek instructions.
8.
In the written statement, the
basic case made out by the Defendant No.1 was that one Mr. Mahesh Thakkar had
fraudulently misused the IEC of Abhay Enterprises. It is claimed that the said
Mr. Mahesh Thakkar was the one who had imported the products. In paragraph 1 of
the reply on merits, the Defendant No.1 stated as under:
“To this,
answering Defendant has already stated that it is neither disputed nor the legality of the trademark has been
challenged by the answering Defendant at any occasion. The trademark of GLAM-UP
LABEL has never been used by answering Defendant in any manner and thus
rights associated with the trademark have not been infringed as alleged by the
Plaintiff.”
9.
Today, learned counsel appearing
for Defendant No.1 submits that as per the show cause notice issued by the
customs authorities on 17th
September, 2014, it is clear that there were several other goods apart
from
GLAM-UP
products, which are part of the consignment and huge losses
have been
suffered by the Defendant. She, however,
submits that she has no
objection
if a permanent injunction is passed against her client. However, it
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1417/2016 Page 3 of 7
is submitted by her that the Defendant No.1, being a small entity, ought
not to be burdened with any damages.
10.
Learned counsel for the
Plaintiff, on the other hand, submits that a perusal of the seizure memo issued
by the customs authorities dated 15th
May, 2014 shows that the value of the seized
products i.e. 14,400 pieces is more than Rs.23 lakhs. The Plaintiff was forced
to give a bank guarantee to the customs to the tune of Rs.5,93,560/- as a
security for getting the goods seized. The Defendant No.1 is a habitual
infringer and is also involved in importing various other counterfeit products.
11.
This Court has perused the
pleadings and documents on record. There is no doubt that the competing mark
and label cartons are absolutely identical. The same are extracted herein
below:
PLAINTIFF’S MARK
DEFENDANT’S MARK
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1417/2016
Page 4 of 7
12.
In the written statement,
Defendant No.1 denies his involvement in the imports and appears to be shifting
the blame to a third party, however, this Court is not going into the said
issue, as the said third party is not before this Court. Admittedly, the name
of Abhay Enterprises i.e. Defendant No.1 appears as the importer with the customs
authorities which is evident from
the show cause notice dated 17th September, 2014 as also from the seizure memo dated 15th May, 2014. Both documents are on
record. The consignment, in respect of which the show cause notice was issued,
appears to have various other products including silver jewellery, mobile
accessories, etc. The present dispute does not relate to any of those products.
In the present case, the Court is concerned only with the products under the
name and label GLAM-UP.
13.
This is a case of res ipsa loquiter. The violation of the
rights of the Plaintiff is writ large even on a perusal of the carton and
products‟
packaging. Such import of counterfeit products
cannot be countenanced in any manner. If such imports are permitted, they would
cause huge losses to trademark owners, especially since markets would be
flooded with such passed off products. Apart from the fact that this has
resulted in serious violation of rights, there is also an issue in respect of
the quality of such products, especially cosmetics, which are used on the skin.
The imported products do not go through the same quality control measures and
thus, can prove to be harmful for the skin. Such imports are also likely to
result in severe damages and losses to the owners of the intellectual property
and as also the consumers. It is in order to protect against such misuse and
harm that the Intellectual Property Rights (Imported Goods) Enforcement Rules,
2007 have been introduced. The customs authorities were right in calling
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1417/2016 Page 5 of 7
upon the owner as per the Rules and detaining the
infringing products. The Defendant No.1 having now agreeing not to import,
manufacture or use the infringing mark, carton and get up under the
name/packaging GLAM-UP, the permanent injunction, as prayed for, is liable to
be granted.
14.
No triable defence exists in
favour of Defendant No.1. As per the provisions of The Commercial Courts,
Commercial Division and Commercial Appellate Division of High Courts Act, 2015
and the Delhi High Court (Original Side) Rules, 2018 it is not necessary that
evidence should be recorded in every suit. In the present case, right from
beginning the Defendant No.1 has made a statement that he is willing to give an
undertaking to not manufacture, sell or import these products. Thus, the only
issue which remains is that of damages. Since Defendant No.1 has not disclosed
his accounts or sale figures, keeping in mind the value of consignment i.e.
approximately Rs.25 Lakhs, the suit of the Plaintiff is decreed for a sum of
Rs.5 Lakhs which is 20% of the value of the consignment. Decree in terms of
paragraph 30(a) be drawn up. In addition, a decree of Rs.5 Lakhs as damages is
also granted in favour of the Plaintiff against the Defendant no.1.
15.
The Defendant Nos.2 & 3 i.e.
the customs authorities are directed to release the bank guarantee furnished by
the Plaintiff in respect of this consignment and to also hand over to the
Plaintiff the 14,400 pieces of GLAM-UP LABEL powder cream to the Plaintiff for the
purpose of destruction and erasure.
16.
Other products of the Defendant
No.1, which have been seized by the customs authority, if any, may be released
to the Defendant No.1 through its authorized signatory.
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1417/2016 Page 6 of 7
16.
The suit is decreed in the above terms. No orders
as to costs.
PRATHIBA M. SINGH, J.
JUDGE
OCTOBER 01, 2018/dk
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1417/2016 Page 7 of 7
