Facts:
The appeal arises from a civil suit filed by Rahul Bansal (plaintiff) against Vishal Gupta and others (defendants) before the District Court (Commercial Court) in Tis Hazari, Delhi. The core dispute concerns using the trademark/label "OM AMAR SHAKTI" / "SARKAR OM AMAR SHAKTI" by the defendants in the edible oil business. The plaintiff claims prior rights over the mark "MATA AMAR SHAKTI" and asserts that the defendants' use of a deceptively similar mark was infringing their trademark rights, which could cause consumer confusion and dilution of their goodwill.
The plaintiff's trademark, however, was not registered, though they held a copyright for the label. The defendants argued that the plaintiff's reliance on unregistered rights and the absence of registration undermined the injunction sought.
Procedural Details:
The defendant filed an application under Order XXXIX Rules 1 and 2 of the Civil Procedure Code (CPC) seeking to restrain the plaintiff from using the mark "MATA AMAR SHAKTI." The Commercial Court granted an ad interim injunction against the defendants, prohibiting them from using the mark "OM AMAR SHAKTI / SARKAR OM AMAR SHAKTI" on edible oils or related products.
The defendants, feeling aggrieved by the order, appealed and challenged the injunction, arguing that the injunction was improperly granted as the plaintiff's mark was not registered and that the order was based on a flawed understanding of trademark law.
The Delhi High Court, upon hearing the appeal, found that the trial court's decision was flawed legally and remitted the case for re-consideration at the trial level, emphasizing legal clarifications related to passing off and the scope of unregistered trademarks.
Issue:
The main legal issues addressed were:Whether an injunction can be granted based on unregistered trademark rights (passing off) and the sufficiency of such rights to prevent use of similar marks?Whether the trial court erred in granting injunction solely based on the belief that the respondent’s mark was prior and deceptively similar, without sufficient proof of reputation or goodwill?
Decision:
The High Court set aside the impugned order and remanded the matter for a de novo hearing before the Commercial Court. The Court emphasized that:
- The mere prior user of a mark does not automatically entitle the party to an injunction; the plaintiff must prove reputation, goodwill, and likelihood of deception.
- The trial court had committed an error by proceeding on assumptions without proper factual and legal examination.
- The unregistered status of the plaintiff's mark meant that the protections against passing off were limited unless reputation and consumer confusion could be conclusively demonstrated.
- The Court clarified that copyright registration does not equate to or substitute for trademark registration in passing off claims.
Legal Significance: This case clarifies the scope of injunctive relief in passing off actions involving unregistered trademarks, emphasizing a requirement for proof of reputation and consumer confusion. It highlights that trademark rights obtained through registration are generally stronger and easier to enforce, but unregistered marks can also be protected if reputation and deception are established sufficiently.
