TATA VERSUS TATA GOLD

                       

COMMENT:

1.         In this Case the Hon’ble Court has held TATA to be a well known trademark. (Para 11)

2.         The Hon’ble Court, after relying upon the doctrine of dilution of trademark, has restrained the defendant from using the trademark TATA GOLD in relation to pressure cooker.(Para 12)

 

3.          As the evidence of the plaintiff has gone un rebutted, the Hon'ble Court has awarded the decree of damage also. (Para 15)

 

                        THE HIGH COURT OF DELHI AT NEW DELHI

                                       CS (OS) No. 1228/2004

                                       Date of Decision: 29.04.2013

TATA SONS LTD. & ANR. .......Plaintiff

Through: Mr. Achuthan Sreekumar, Ms.Udita, Advs.

Versus

AMIT MAHNA & ORS. ......Defendant

Through: Nemo

CORAM:

HON'BLE MR. JUSTICE M.L. MEHTA

M.L. MEHTA, J.

1. The present suit has been instituted by the plaintiffs against the defendants seeking permanent injunction restraining infringement of trademarks TATA by the defendants. The plaintiffs are also praying for an order of delivery-up of all infringing materials along with the rendition of accounts of profit illegally earned as well as damages.

2. This suit has been filed by Tata Sons Ltd., a company incorporated under the Indian Companies Act, 1913. The plaintiff has contended that it was established in the year 1917 and is the principal investment holding company of the Tata Group, which is India‟s CS (OS) No. 1228/2004 Page 1 of 9 oldest, largest and best-known conglomerate with a turnover of USD 9 Billion. The name TATA is stated to be have been derived from the surname of its founder Mr. Jamsetji Nusserwanji Tata. It is also stated that the name TATA is being used by the plaintiffs since its inception in the year 1917 and it is claimed that on account of its highly descriptive nature and pioneering activities of the founder, the name TATA has consistently been associated with and exclusively denotes the conglomeration of companies forming the Tata group, which is known for high quality of products manufactured and/or services rendered by it under the trademark/name TATA.

3. It is stated that the House of TATA comprises over 50 companies which use TATA as a key and essential part of their corporate name. Additionally, it is also contended that there are numerous overseas companies, philanthropic bodies and autonomous public institutions which are promoted by the plaintif. And that plaintiff is the registered proprietor of the trademarks pertaining to and/or comprising the word TATA in relation to various goods falling across various classes of the Fourth Schedule of the Trade Mark Rules, 2002. By virtue of the said registration, it is contended that plaintiff has the exclusive right in the said trademark and is thus entitled to the exclusive use thereof.

4. And that various companies belonging to the House of TATA dealing in goods clearly state on their products/packaging, the legend „A TATA PRODUCT‟, while those dealing in services identify themselves by the distinctive trading style of TATA. The use of the trademark TATA by various companies belonging to the House of TATA is governed by a carefully formulated policy, called the „The TATA Brand Equity and Business Promotion Scheme‟. And that the plaintiff is the registered proprietor of various TATA trade marks that are licensed through Registered User Agreements to other TATA Companies, which manufacture the goods and sell them under the said trademark(s). The Registered User Agreements have also been duly recorded with the Trade Marks Registry in India in accordance with the relevant provisions of law.

5. The plaintiff submits that as a result of extensive use of the plaintiff‟s trade mark TATA over a long period of time spanning a wide geographical area coupled with vast promotion and publicity, the trade mark TATA has acquired an impeccable and unparalleled reputation and goodwill and has come about to acquire the status of „well-known trade mark‟. It submits that reputed and well-known trade marks especially those that embody an aura of preeminent excellence and quality, such as the plaintiff‟s trade mark TATA are entitled to the highest degree of protection against any third party misuse, even in relation to different goods and/or services.

6. The plaintiff submits that in September 2004, it came across pressure cookers in the market bearing the trade mark TATA. The impugned products contained the trade name „TATA GOLD‟, which is represented in a manner wherein the mark TATA is portrayed in bold and prominent manner, while the mark GOLD is written in small print. Upon further investigation, it appeared that these goods are being manufactured and/or sold by the defendant no. 1, Mr. Amit Mahna, who is the proprietor of defendant no.2, Bali Kitchenware Industries, which is located at No. 48/1, Sayed Nangoli, New Delhi - 110041. Defendant no. 3, Mr. Hans Raj Mahna, is the proprietor of defendant no. 4, Hamnani Stores, which is located at 891-C, Chowk Qutub Road, Sadar Bazar, Delhi - 110006. The plaintiff states that it instructed the conduct of an investigation of the defendants‟ premises and that the affidavit of the investigator is annxed as ANNEXURE A. And that the defendants catalogue and price list (annexed as ANNEXURE A1 and ANNEXURE A2 respectively), reveal that the defendants are engaged in the manufacture and sale of pressure cookers under various other brandnames like MILTON and CROMPTION. The plaintiff submits that the defendants, instead of developing their own brands, are merely seeking to free-ride on the goodwill of established brands. And that the use of a mark that is phonetically and visually identical to the plaintiff‟s registered trade mark TATA amounts to infringement of the registered trade mark, as also passing off by the defendants as per the provisions of the Trade Marks Act, 1999.

7. The plaintiff states that the defendants activities are undoubtedly motivated by malafides, and that their choice of the mark TATA was not a mere coincidence but led by an ulterior motive to misappropriate and trade upon the goodwill land reputation of the plaintiff‟s trade mark. The plaintiff further states that, by being tainted at its very inception, no amount of subsequent use can cleanse the defendants‟ vice of dishonest adaptation of the mark TATA GOLD. And that by adopting the plaintiff‟s trade mark, the defendant is trying to derive an unfair advantage in the consumer market by creating the impression that the defendant‟s products emanate from the plaintiff or have some connection, nexus, association, affiliation, or endorsement with the plaintiff. And that the impugned goods are bound to confuse and mislead the public to their origin and induce them to buy the said products believing them to be originating from the plaintiff.

8. The plaintiff states that the cause of action arose for the present suit in September 2004, when it came across the impugned goods, bearing the mark TATA. And that the cause of action continues to subsist till such time the defendants are permanently restrained by an order of injunction. And that this Court has the necessary territorial jurisdiction to entertain and try the present suit as the defendants reside and carry on business/work for gain within the jurisdiction of this Court.

9. In support of its contentions, the plaintiff has also placed on record, the decisions of this Court in Tata Sons Ltd. v. A. K. Chaudhary & Anr., CS (OS) No. 842/2002 (AK Chaudhary Case) as well as Tata Sons Ltd. v. Manoj Dodia & Ors., CS (OS) No. 264/2008 (Manoj Dodia Case), where this Court has recognized the „well-known‟ status of the TATA mark. The plaintiff has also produced a table of all the cases (as cited in the table in Paragraph 20 of the plaint), that they have filed before this Court, as well as the WIPO Arbitration and Mediation Centre, with respect to the misuse of its trade mark as well as domain names. I have heard the arguments of the Counsel for the plaintiff. I have also perused through the evidence placed on record.

10.Before proceeding to decide the matter, it is pertinent to note that the Trade Marks Act, 1999 accords statutory protection to well- known marks. Section 29(4) of the Act, which is relevant in this regard is as under.

"29(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which -

(a) Is identical with or similar to the registered trade mark; and

(b) Is used in relation to goods or services which are not similar to those for which the trade mark is registered; (c) The registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark."

11.This Court in the Manoj Dodha Case (supra) has held:

"Considering that (a) the mark TATA whether word mark or device or in conjunction with other words is being used for last more than 100 years, in respect of a large number of goods and services, (b) Tata Group, which is probably the oldest and largest industrial and business conglomerate having a turnover of Rs. 96,000 crores in the year 2005-06, the Tata Group comprises a number of large companies, millions of customers are using one or more TATA products throughout India and other countries, (c) there are more than 100 registrations of the trade mark TATA either by way of word mark, or device or use of the name TATA and other words, (d) the Courts having in a number of judgments/orders recognize TATA as a well-known mark, (e) there is no evidence of any other person, holding registration of or using the trademark TATA and (f)the reputation which companies of Tata Group enjoys not only in India but in other countries, it is difficult to dispute that the trade mark TATA is a famous and well-known brand in India. I, therefore,, have no hesitation in holding that the mark TATA whether word mark or device or when used in conjunction with some other words, is a well-known trade mark, within the meaning of Section 2(z)(b) of the Trade Marks Act, 1999. The use of the trade mark TATA in relation to any goods or services, is therefore, likely to be taken as a connection between House of Tata and the goods or services, which are sold under this trade mark or a trade mark which is similar to it.

12.Further, in the AK Chaudhary Case (supra), this Court has also made pertinent observations regarding passing off under the doctrine of dilution and unfair competition. The Court observed:

"According to the doctrine of dilution, even if a person uses another's well-known trademark or trade mark similar thereto for goods or services that are not similar to those provided by such other person, although it does not cause confusion among the consumers as to the source of goods or services, it may cause damage to the well-known trade mark by reducing or diluting the trade mark's power to indicate the source."

13.In the instant case, I have perused through the report of the Local Commissioner along with the list of inventory prepared by him of the impugned goods which were first taken in his custody and later released upon superdarinama. I have also perused through the other documents placed on record. I am of the opinion that the plaintiff has established a case of passing off with respect to the defendant‟s products carrying the plaintiff‟s trade mark TATA. The impugned goods are also clearly infringing the well-known trade mark of the plaintiff.

14.The suit of the plaintiff is accordingly decreed and an order of permanent injunction restraining the defendants from manufacturing, selling, advertising pressure cookers or goods of any description bearing a trade mark that is identical or similar to the plaintiff‟s trade mark TATA. The defendants are also directed to destroy the goods and packaging material or any other printed material bearing the trade mark TATA within a period of four weeks from today.

15.With regards the relief of damages prayed for by the plaintiff for the loss of profits to the tune of at least Rs. 5,05,000/- (Rupees Five Lakh Five Thousand Only). It is pertinent to note that the defendant has been proceeded ex parte vide Order date May 6, 2005. The evidence of the plaintiff has gone un rebutted, which includes loss of business, reputation and goodwill in the market. Since the amount of damages claimed is based on assessment of the plaintiff which is unassailed, I am of the view that a sum of Rs. 5,05,000/- (Rupees Five Lakh Five Thousand Only) can be reasonably awarded to the plaintiff as compensatory for the loss of business and damage to the goodwill. Decree be drawn accordingly.

M.L. MEHTA, J.

APRIL 29, 2013

 

ALBERTO CULVER CASE

COMMENT: Here is the reproduction of relevant paragraph of the judgment , in which the Hon’ble Court has referred to DHODHA HOUSE Judgment and explained the meaning of carry on business, and work for gain.

 

          “the expression ‘carries on business’ and the expression, ‘personally works for gain’ connote two different meanings.  For the purpose of carrying on business only presence of a man at a place is not necessary. Such business may be carried at a place through an agent or a manager or through a servant.  The owner may not even visit that place.  The phrase ‘carries on business’ at a certain place would, therefore, mean having an interest in a business at that place, a voice in what is done, a share in the gain or loss and some control thereover. The expression is much wider than what the expression in normal parlance connotes, because of ambit of a civil action within the meaning of Section 9 of the Code. But it is, inter alia, necessary that the agent must be a special agent who attends exclusively to the business of the principal and carries it on in the name of the principal and not a general agent who does business for any one who pays him. In the case in hand, there is no allegation in the plaint that agent is an exclusive agent of the respondent/plaintiff. From the documents placed on record it would appear that J.L. Morison is doing the business for other persons also. 

 

 

IN THE HIGH COURT  OF  DELHI  AT NEW DELHI

SUBJECT : CODE OF CIVIL PROCEDURE

FAO 480/2011

Date of Decision:  July 1, 2013

PIONEER PRODUCTS  ..... Appellant Through : Mr.Suhail Dutt, Sr.Adv. with Mr.N.K.Kantawala, Mr.Praver Sharma, Mr.Satyender Chahar and Mr.Ritesh Mehra, Advs.

versus

          ALBERTO CULVER INTERNATIONAL INC.  ..... Respondent        Through    : Mr.S.K.Bansal with Mr.Vikas Khera, Advs.

          CORAM:HON'BLE MS. JUSTICE VEENA BIRBAL

VEENA BIRBAL, J.

1                   Present appeal has been preferred by the appellant against the order dated 1st October, 2011 passed by the learned Additional District Judge, New Delhi whereby application of the respondent under Order 39 Rule 1 & 2 CPC was allowed and the interim order dated 9th September, 2009 has been confirmed.

 

2                   Appellant herein is defendant no.1 before the learned trial court.  Respondent herein is plaintiff before the learned trial court. The respondent/plaintiff has filed a suit under Section 134 and 135 of the Trade Marks Act, 1999 (hereinafter referred to as the Act) against appellant/defendnant no.1 and one R.P. General Stores i.e. defendnat no.2 before the trial court for the relief of permanent injunction retraining the appellant/defendant no.1 from using in any manner including by way of manufacturing, sale trade etc. of the impugned marks VOV, VO5 or similar or identical marks in relation to cosmetics, toiletries and personal care products such as hair sprays, shampoos, personal deodorants, hair tonic, etc. Prayer is also made for damages and/or rendition of accounts. Along with the aforesaid suit an application under Order 39 Rules 1 and 2 was also filed praying for the grant of ad interim injunction during the pendency of the suit restraining the appellant/defendant no.1 from manufacturing, selling, offering for sale, advertising in India and exporting their products under the Trase Mark VOV which is phonetically similar to the respondent’s/plaintiff’s Trade Mark VO5 in relation to aforesaid products. The respondent/plaintiff is engaged in the business of manufacture and distribution of wide range of cosmetic products such as hair sprays, shampoos, deodorants, hair and scalp conditioners, hair oil, hair tonic, and other allied products etc. It is alleged that in the year 1955, respondent/plaintiff through its predecessors adopted and started using the Trade Marks VO5 and V05 along with letters ‘ALBERTO’. With the passage of time, respondent/plaintiff also started using the Trade Mark VO in the course of trade in respect of its goods. The Trade Mark VO, VO5 is an essential, material and distinguishing feature of the said Trade Mark Label. As per respondent/plaintiff, it has acquired worldwide reputation. The respondent’s/plaintiff’s Trade Mark ALBERTO VO5, VO5 Label and V05 are duly registered in India under the Trade Marks Act, 1999. The dates of registration are given in the plaint. It is alleged that in view of registration of its Trade Mark, respondent/plaintiff has exclusive rights thereto within the meaning of the aforesaid Act. The art works involved in the aforesaid Trade Mark/Label are original artistic work and the respondent/plaintiff holds copy right therein. It is alleged that art work involved in the respondent/plaintiff’s Trade Mark/Label VO5 along with the word ALBERTO is duly registered under the Indian Copyright Act, 1957. It is alleged that respondent/plaintiff has already built up a globally valuable trade under the aforesaid Trade Mark/Label and has conducted handsome business thereunder running into billions of dollars worldwide. The respondent/plaintiff has spent millions of dollars in advertising its products. It is alleged that respondent’s goods are known, recognized, demanded, sold and traded world over with reference to the said Trade Mark/Label. It is alleged that respondent’s/plaintiff’s goods under the aforesaid Trade mark/Label are available in Delhi including New Delhi and other parts of the country through its authorized importer and distributor M/s J.L.Morison (India) Ltd., “Crystal”, 79, Annie Besant Road, Worli, Mumbai-400018 also at 404, Rohit House 3 Tolstoy Marg, New Delhi-1100001.

 

3. It is alleged that the respondent/plaintiff is a global leader in the aforesaid goods and business. M/s Alberto Culver Company is the predecessor-in-title of the respondent/plaintiff. The said predecessor has assigned all rights, titles and interests in the aforesaid trade marks/ copyrights along with the goodwill to the respondent/plaintiff, vide a Deed of Assignment dated 14.04.2006. It is alleged that respondent/plaintiff is one of the Group Companies of M/s Alberto Culver Company.

 

4.       The respondent/plaintiff has alleged that appellant/defendant No.1 has adopted an identical/deceptively similar trade mark VOV (which is a colourable imitation of the respondent’s/plaintiff’s mark since ‘5’ is written in Roman numerals ‘V’) in relation to the same/similar goods being cosmetics including nail polish, lipstick, eye liner, compact, liquid kumkum and other beauty products etc. It is alleged that appellant/defendant no.1 had filed an application for registration of trade mark VOV which was abandoned. The defendant no.2 i.e.R.P. General Stores is the dealer/distributor of the appellant/defendant no.1 in Delhi including the markets of South Delhi. The trade mark VOV being used by the appellant/defendant no.1 in relation to their goods and business is identical with and deceptively similar to respondent’s/plaintiff’s said “VO, VO5 and VO5 with ALBERTO” trade marks in each and every respect including phonetically, structurally, conceptually and in its essential features. It is alleged that appellant/defendant no.1 by their impugned adoption and use of the trade mark VOV amounts to violating respondent’s/plaintiff’s trade mark and amounts to passing off their goods as that of respondent/plaintiff.

 

5. The case of the appellant/defendant no.1 is that respondent/plaintiff has wrongly invoked the territorial jurisdiction to entertain and try the present suit against appellant/defendant no.1. There is no cause of action in favour of respondent/plaintiff against appellant/defendant no.1. That the respondent/plaintiff has never used nor advertised the mark ALBERTO VO5 or VO5 in India at any point of time. It is alleged that appellant/defendant no.1 is carrying on its lawful business as manufacturer and merchant of cosmetics under the mark V O V (label) in a specific artistic way and the three letters V O V written within rectangles is altogether different and distinct from that of the mark ALBERTO VO5 of respondent /plaintiff. The appellant/defendant no.1 honestly and bona fidely adopted the mark V O V for kumkum only in the year 1987 and in the year 2002 added more cosmetic products under the mark VOV and has used the same openly and continuously. It is also alleged that there is no document on record to show that user/reputation of the mark ALBERTO VO5 in India. Respondent /plaintiff from time to time made statements before the Registrar of Trade Marks that the impugned mark is “proposed to be used”. It is stated that even in the matter of latest application no.1349772; filed by respondent /plaintiff on 8.4.2005 for the mark ALBERTO VO5 in India, the user shown is `proposed to be used’ which is clear indicator of the fact that even in 2005, respondent no.1/plaintiff had an intention to use the mark ALBERTO VO5 whereas appellant/defendant no.1 is using the mark V O V since 1987 for kumkum and since 2002 for other cosmetics. It is also stated that conduct of respondent/plaintiff shows that respondent/plaintiff is interested only to harass the appellant/defendant no.1 in one way or the other. It is stated that respondent /plaintiff has filed number of cases, the details of those are given in reply dated 12.8.2011 of appellant/defendant. It is alleged that the same shows conduct of respondent/plaintiff. It is also alleged that respondent no.1/plaintiff has never used or advertised the mark ALBERTO VO5 in India at any point of time. It is further alleged that respondent/plaintiff has filed a copy of the alleged distribution agreement dated 09.02.2009 with J.L.Morison (India) Ltd to show that J.L.Morison (India) is an exclusive distributor in Delhi. It is alleged that apart from the copy of agreement dated 9.2.2009, no other documents have been filed to prove that the alleged distributor is an ‘exclusive distributor’ or has at any point of time distributed the goods of respondent no.1/plaintiff under the mark ALBERTO VO5 in Delhi or within the jurisdiction of this court. It is their further stand that the goods of respondent no.1/plaintiff under the mark ALBERTO VO5 have never been sold in any part of India or within the jurisdiction of this court. It is further alleged that J.L. Morison (India) Limited is not an exclusive distributor of the respondent’s/plaintiff’s goods under the mark ‘ALBERTO VO5’. It is alleged that the so called distributor has never distributed the goods of the respondent’s/plaintiff’s in India under the mark ALBERTO VO5 at any time. It is alleged that as per respondent/plaintiff the distributorship was applied only on 09.02.2009 whereas appellant/defendant is using the mark V O V for kumkum in 1987 and in 2002 for other cosmetic products. It is further alleged that labels/packaging/artworks of appellant/defendant no.1 for the mark V O V are different from that of the labels/packaging/artworks of respondent/plaintiff impugned mark ALBERTO VO5 which is altogether different and distinct from the mark V O V of appellant/defendant no.1. 

 

6.       Vide impugned order dated 1st October, 2011, the learned trial court has allowed the application of the respondent/plaintiff under Order 39 Rule 1 and 2 CPC and has confirmed the order dated 9th September, 2010 thereby allowing the application under Order 39 Rule 1 and 2 CPC.

 

7.       At this stage, it may be necessary to refer to the history of litigation between the parties to the present case.

 

8.       Respondent/plaintiff had earlier filed CS(OS) no.672/2004 on the original side of this court.  In that case, appellant/defendant herein was made the sole defendant. After pleadings were completed, issues were framed.   One of the issues framed, relates to the territorial jurisdiction of this court. 

9.       The learned Single Judge of this court vide order dated 27th August, 2010 treated the issue relating to territorial jurisdiction as a preliminary issue and held that this court has no jurisdiction to try the suit and ordered that suit be returned to the respondent/plaintiff to be filed before the Principal Civil Judge at Thane with the following observation:-“8. .………………………………………………………….. .……………………………………………………………….... ………………………………………………………………….. ………………………………………………………………….. In Dhodha House case, the Supreme Court held that the mere fact that the goods are available in a particular place – in that instance in Delhi or that they were sold in different area, would not itself mean that the plaintiff carried on any business in Delhi. This Court is bound by that ruling. The materials on record, particularly the pleadings, nowhere point to the plaintiff having any office in Delhi or even averring that it appointed a distributor whose office are located within the jurisdiction of the Court nor is there any averment whosoever vague disclosing that the plaintiff has any business either substantially or otherwise in the form of turn over from Delhi or for that matter in India. In these circumstances, this Court is satisfied that the suit so far as the infringement is concerned based upon the application of Section-134, is not maintainable.

 

9. So far as question as to whether any part of the cause of action has arisen in the jurisdiction of this Court is concerned, the documents available in the form of about 557 pages filed along with the list of documents would reveal that there is no material establishing that the defendant sold their products within the jurisdiction of this Court or anywhere in Delhi. No doubt, the plaintiff has a right to adduce the evidence in the trial to establish the defendant’s presence, but the Court is conscious of the fact that after issues were framed, parties were provided with the opportunity to produce further or additional documents. It was not pointed out that such additional documents were ever filed all this while after the issues were framed more than 4½ years ago. In any event, no such application for producing additional documents to establish the defendant’s presence within the territorial limits of this Court’s jurisdiction was ever moved. It is also settled that once issues are struck and the parties are required to lead evidence, there is no question of the Court entertaining the application for adducing further documentary evidence during the trial.

 

10.     Having regard to this, it is apparent that the Court now has to consider the effect of the two documents placed on the record by the defendant. While the defendant’s arguments that the Court’s enquiry is to be confined to while considering the plea about jurisdiction or the lack of it in the averments in the suit and the list of documents filed along with it as correct, at the same time, the Court cannot be oblivious of the materials which are on the record particularly after admission/denial. The defendant here has placed two invoices on the record. At best, they only indicate that some goods were dispatched to Delhi.  That by itself is sufficient, in the opinion of the Court, to hold that the defendant is either trading in Delhi or cause of action of such nature is occurred, occasioning the plaintiff to file the present suit. The two transactions at best would amount to a flash in the pan, which, in no way, establish that the dispute can be entertained as is sought to be urged by the plaintiff. In Sector Twenty One Owner’s Welfare Association v. Air Force Naval Housing Board 65 (1997) DLT 81, it was held that trivial or insignificant part of the cause of action arising at a particular place would not be enough to confer jurisdiction.

 

11. This Court is not persuaded to take a view different from that taken in Alberto’s case (supra) where the plaint was returned. In the circumstances, the suit is returned to the plaintiff to be filed before the Principal Civil Judge at Thane. Parties are directed to be present before the Principal Civil Judge, Thane, on 25th October, 2010.”

10.     The order dated 27th August, 2010 passed by the learned Single Judge attained finality as no recourse was taken by the respondent/plaintiff against the said order. During the period CS(OS) 672/2004 on the Original side of this court, there was no interim order operating between the parties. 

 

11. On 09.09.2010 the respondent/plaintiff instead of filing the returned plaint at the Courts at Thane, preferred a fresh suit against appellant/defendant No.1 at the District Court at Saket Courts Complex.  This time the respondent/plaintiff claimed that the court has territorial jurisdiction to try the suit in view of agreement dated 09.02.2009 whereby one J.L. Morison (India) Ltd. (hereinafter J.L. Morison) has been appointed as agents and distributors in India for their products marketed under the trade mark VO5 and that J.L. Morison has their regional distributorship at 404, Rohit House, 3 Tolstoy Marg, New Delhi. In addition, the defendant No.2 i.e. R.P. General Stores was made a party to the case. Here it may be mentioned that defendant No.2 was the same entity to whom the appellant/defendant No.1 had supplied the goods in pursuance of the two invoices which were relied by the plaintiff in CS(OS) No.672/2004 for contending that the courts at Delhi has the territorial jurisdiction to try the suit.

 

12.     The learned Additional District Judge to whom the suit was assigned granted ex parte stay to the respondent/plaintiff. After completion of pleadings the learned Additional District Judge vide order dated 28th May, 2011, in view of the fact that the office of the regional distributorship of J.L. Morison was at New Delhi district and not in South Delhi District returned the plaint for being presented before the court of competent jurisdiction and the interim order dated 9.9.2010 was ordered to be continued for a period of five days.

 

13.     The respondent/plaintiff presented the plaint returned by the court at Saket to the court of Additional District Judge-I, Patiala House Courts, New Delhi on 1st June, 2011. On the aforesaid dated the learned Additional District Judge, New Delhi, issued notice to appellant/defendant no.1 and  extended the interim order dated 9th September, 2010. The appellant/defendant preferred an appeal against the order dated 1st June, 2011 before this court which was registered as FAO 344/2011. The learned Single Judge of this court has disposed of the said appeal vide order dated 8th August, 2011. The relevant paras of the order dated 8th August, 2011 reads as under:-

“3. I agree with the contentions of the learned counsel for the appellant that there is no question of extension of stay as has been done by the impugned order because after the plaint was returned by the order dated 9.9.2010 by the ADJ, at Saket Courts, Delhi, filing of the suit in a competent Court, there was a fresh filing of the suit and therefore whether or not injunction ought to have been granted should have been considered afresh keeping in mind the requirements of Order 39 Rule 1 and 2 CPC. Also, the application of the respondent/plaintiff for seeking extension of injunction is also misconceived for self-same reason. If the trial Court was inclined to grant an ex parte injunction de novo, the trial Court ought to have discussed the triple factors, prima facie case, balance of convenience and irreparable loss and which are not found in the impugned order. The order is completely a non-speaking order.

 

4.       Accordingly, though the impugned order, in view of what is stated above, is liable to set aside, however, if one does not go on technicalities, it can also be said that the impugned order seeks to grant an ex parte injunction in a fresh suit. However, the ex parte injunction would suffer from the infirmities of not being a speaking order and not considering the necessary ingredients for grant of the injunction and more so on grant of an exparte injunction, the requirement of Order 39 Rule 3 CPC had to be directed to be complied with and which  has  not been done.

 

5.       Accordingly, while accepting the appeal and setting aside the impugned order, I direct that the matter be taken up by the trial Court on 17th August, 2011 and on which date the respondent/plaintiff will file an application under Order 39 Rules 1 and 2 CPC for grant of interim orders. I may hasten to clarify that though the impugned order is being set aside, interim order passed by the trial Court on 1.6.2011 is being continued only and only upto 17.8.2011 and when the trial Court will examine the issue with respect to entitlement of the respondent/plaintiff to an injunction uninfluenced by the fact that interim injunction is continued till 17.8.2011 and after ensuring that requirements of law for grant of an interim order in terms of Order 39 CPC are complied with. The trial Court will hear both the parties and pass a speaking order as to the entitlement or disentitlement of grant of interim orders.     With the aforesaid observations the appeal and application are disposed of.”

 

14.     Thereupon respondent/plaintiff filed fresh application under Order 39 Rule 1 and 2 of CPC. The arguments were heard on the said application. Vide order dated 01.10.2011, impugned in this appeal, the learned ADJ confirmed the stay granted earlier on 09.09.2010.

 

15. On the territorial jurisdiction, Learned senior counsel Mr.Suhail Dutt appearing for the appellant/defendant no.1 has contended that the respondent/plaintiff has wrongly invoked the jurisdiction as per section 134(2) of the Act as respondent/plaintiff does not carry any business in Delhi either directly or through any exclusive dealer/distributor. It is contended that respondent/plaintiff has no sale in Delhi or even in India. It is contended that not even a single document is produced which shows any use or advertisement of trade mark ALBERTO VO5 by respondent/plaintiff in India. It is contended that as per respondent/plaintiff it has appointed authorized importer/distributor in India on 9.2.2009 but has failed to produce a single document to prove sales, if any, done by it in India either prior or even after its appointment. It is contended that jurisdiction or cause of action paras of the plaint does not say that J.L.Morrison Ltd. is the respondent/plaintiff’s “Exclusive Distributor”, the plaint only says “Distributor”. Learned Senior Counsel has also contended that the plaint of first suit was returned by this court in CS(OS) No.672/2002 vide order dated 27.8.2010 by holding that Delhi Courts lack territorial jurisdiction to entertain and try the suit.  In the said order, specific finding was given by the learned Single Judge of this court that two invoices of defendant no.2  placed on record were insufficient to hold that respondent/plaintiff was either trading in Delhi or cause of action had occurred at Delhi. It is contended that the said order was not assailed by respondent/plaintiff, as such, suit is barred by res judicata. It is further contended that plaint of second suit being Suit No.1389/2010 vide order dated 28.5.2011 by the learned ADJ, Saket, was returned to be presented before the court of competent jurisdiction. In that case, it was observed that court at Delhi lacks jurisdiction.

 

16.     On merits, learned senior counsel has contended that marks of both the parties are visually and phonetically different and customers of respondent/plaintiff’s are different. It is contended that the respondent’s/plaintiff’s products are not available in India. It is contended that in case the same are made available the same would be purchased by elite and literate society as the products of respondent/plaintiff are costly. It is further contended that the customers of products of both the parties are literate who can easily distinguish between the two in terms of the mark, their packaging, their use etc. It is contended that there is huge price variation of products of both the parties. It is further contended that products of both the parties are entirely different in use and their application. The appellant/defendant no.1’s products are nail polish, compact powder, kumkum, mascara, lip gloss etc and respondent/plaintiff only produces hair related products i.e., shampoo and conditioners. It is contended that respondent/plaintiff uses the word ALBERTO as a prefix to VO5 whereas appellant/defendant no.1 uses the single word V O V i.e., WOW which suggest great pleasure and amazement.  It is contended that in the earlier suit i.e. CS(OS) 672/2004 filed by respondent/plaintiff, no injunction in its favour was granted by this court and the said suit remained pending for 6 years. On return of the plaint, respondent/plaintiff filed a fresh suit at District Court at Saket Court Complex and obtained an ex parte order dated 9.9.2010 and later on the said plaint was also returned and thereafter injunction was granted vide impugned order dated 1st October, 2011 by the ld.ADJ, Patiala House Courts. In these circumstances, balance of convenience was also in favour of appellant/defendant no.1 and the learned trial court has not considered the same. It is contended that appellant/defendant no.1 has documentary evidence to prima facie show use of the mark trade VOV for the past 25 years whereas there is no prima facie case in favour of respondent/plaintiff. It is contended that in the facts and circumstances of the case, the appellant/defendant no.1 would suffer an irreparable loss and injury if the impugned order is not set aside.

 

17. Learned counsel for the respondent/plaintiff has contended that respondent/plaintiff is a registered proprietor of trade mark VO5 in India, accordingly, the respondent/plaintiff is entitled for the remedy of infringement. It is contended that for the purpose of territorial jurisdiction, the respondent/plaintiff is entitled to special benefit of section 134(2) of the Act wherein respondent/plaintiff is provided with additional forum for filing suit in case of infringement of its trade mark at a place where respondent/plaintiff resides and carries on its business. It is further contended that respondent/plaintiff has also pleaded jurisdiction of this court on account of appellant’s/defendant no.1’s activities of selling its products in New Delhi area clandestinely and surreptitiously, under the provisions of section 20 of CPC. It is contended that M/s J.L.Morison India Ltd was appointed on 9.2.2009 as exclusive distributor of VO5 products in India and M/s J.L.Morison India Ltd has its office at Mumbai and also at Tolstoy Mark, New Delhi which is within the jurisdiction of this court, as such, courts at Delhi has jurisdiction to try the present suit. It is contended that respondent/plaintiff has Indian trade mark registrations for the mark ‘ALBERTO VO5’ (word mark) under No.196213B in Class 3 dated 30.5.1960; ALBERTO ‘VO5’ label under No.1349772 in Class 3 dated 8.4.2005; VO5 (word mark) under No.788766 in Class 3 dated 23.1.1998; VO5 logo under No.788768 in Class 3 dated 23.1.1998. It is contended that respondent/plaintiff has exclusive rights to use the trade mark VO5 under Sections 28 and 29 of the Act, 1999. It is contended that appellant/defendant no.1 in its trade mark application filed in the Trade Marks Office No.1263141 in Class 3 has claimed use of its trade mark V O V from 31st December, 2002 in relation to cosmetic preparations whereas in the present appeal, appellant/defendant no.1 is trying to claim use of the trade mark from 1986. It is contended that no document in this regard has been filed. It is contended that respondent/plaintiff has trade mark registration for ALBERTO VO5 since 1960 and VO5 from the year 1998 and respondent/plaintiff has claimed use of the mark internationally since 1955. It is contended that appellant/defendant no.1 has not been able to establish continuous use of the mark prior to respondent/plaintiff’s registration. It is contended that respondent/plaintiff is also entitled to the benefit of trans border use and reputation of the mark. It is further contended that the learned ADJ after considering the facts and circumstances of the case has exercised discretion by granting injunction in favour of respondent/plaintiff. It is contended that there is nothing on record to show that discretion has been exercised arbitrarily or capriciously, as such, the appellate court would not interfere with the exercise of discretion of the court of first instance and substitutes its own unless discretion has been exercised arbitrarily or capriciously.

 

18.     In order to succeed in his application, the respondent/plaintiff was required to establish that it has a good prima facie case. Such inquiry would have necessarily required the examination of question as to whether the courts at Delhi have the territorial jurisdiction to try this suit. The respondent/plaintiff may have averred in the plaint that Courts at Delhi have jurisdiction to try this suit but the issue that would arise is as to whether the respondent/plaintiff has succeeded in prima facie showing that the courts at Delhi have such jurisdiction. The courts at Delhi have the jurisdiction to try the suit either under Section 134 of the Trade Marks Act, 1999 or under Section 20 of CPC. Apart from relying on the two documents which relate to the transaction between the two defendants and which were held to be not sufficient to vest the courts at Delhi with the territorial jurisdiction in CS(OS) No.672/2004, the respondent/plaintiff has relied upon its dealership agreement with J.L. Morison which is having its regional distribution at 404, Rohit House, 3 Tolstoy Marg, New Delhi. The plaintiff also relies on the fact that the defendant No.2 is residing and carrying on business at Delhi.

 

19.     The respondent/plaintiff itself is neither registered at Delhi nor has its office at Delhi. It is otherwise not the case of the respondent/plaintiff that it is personally working for gain at Delhi. Thus, to that extent the position in the suit and the earlier suit remains the same. 

20.     In the case of Dhodha House v. S.K. Maingi 2006 (9) SCC 4, the Supreme Court has held that the expression ‘carries on business’ and the expression, ‘personally works for gain’ connote two different meanings.  For the purpose of carrying on business only presence of a man at a place is not necessary. Such business may be carried at a place through an agent or a manager or through a servant.  The owner may not even visit that place.  The phrase ‘carries on business’ at a certain place would, therefore, mean having an interest in a business at that place, a voice in what is done, a share in the gain or loss and some control thereover. The expression is much wider than what the expression in normal parlance connotes, because of ambit of a civil action within the meaning of Section 9 of the Code. But it is, inter alia, necessary that the agent must be a special agent who attends exclusively to the business of the principal and carries it on in the name of the principal and not a general agent who does business for any one who pays him. In the case in hand, there is no allegation in the plaint that agent is an exclusive agent of the respondent/plaintiff. From the documents placed on record it would appear that J.L. Morison is doing the business for other persons also.  It is not shown at this stage that the respondent/plaintiff is having an interest in the business or at the place of business of J.L. Morison at Delhi, or a voice in what is done, or a share in the gain or loss and some control thereover. Not even a single document has been placed on record to show, sales if any, done by it in Delhi or India after the appointment of J.L. Morison as its distributor. Thus, under Section 134 of the Trade Marks Act, 1999 is of no assistance to the respondent/plaintiff. To my mind, in the facts of this case, fact that the defendant No.2 is doing business at Delhi is also of no significance inasmuch as the two documents relating to the transaction between the two i.e. appellant/defendant no.1 and defendant no.2 were held to be not sufficient to vest the courts at Delhi with territorial jurisdiction. After having chosen to continue the earlier suit without making the defendant No.2 a party to the said suit the plaintiff cannot now agitate the same issue on the basis of same documents by making defendant No.2 a party to the suit. Every violation of a trade mark or act of passing of may be a fresh cause of action. That however, cannot mean the respondent/plaintiff is at liberty to rely on those very transactions, which were the subject matter of the earlier suit between the parties and which were specifically gone into by the court. Thus, Section 20 CPC is also not going to help the respondent/plaintiff at this stage.

 

21. In the circumstances, it appears to this court that respondent/plaintiff has failed to prima facie show that the courts at Delhi have territorial jurisdiction to try the suit for reason of his Dealership Agreement with J.L. Morison or on account of having made defendant No.2 party to the suit. 

 

22.     In view of above discussion, I do not find it appropriate to deal with other contentions of the parties as the same pertains to merits of the case. Accordingly, the other contentions and case law referred to by the parties have not been discussed herewith.

 

23.     Accordingly, the appeal is allowed and the impugned order stands set aside. The trial court shall now proceed in accordance with law for which the parties shall appear before the learned Trial Judge on 16.7.2013. 

 

24.     The appeal stands disposed of.

 

25.     Nothing contained in this order shall be treated as expression of opinion on the merits of the case. 

 

 

Sd/VEENA BIRBAL, J JULY 1, 2013

DGT HOLDING CASE

COMMENT: In this Judgment, the Hon’ble Delhi High Court has laid down the important proposition.

1. The plaintiff would be entitled to institute an action of passing off in respect of a design used by him as a trade mark, provided the action contains the necessary ingredients to maintain such a proceeding. (Para No.10).

IN THE HIGH COURT OF DELHI AT NEW DELHI

CS(OS) 1414 of 2012

DGT HOLDING B.V & ANR ..... Plaintiffs

Through: Mr. N. Mahabir and Dr. Sheetal Vohra, Advocates.

　

versus

RAVI SCIENTIC INDUSTRIES & ANR ..... Defendants

Through: Mr. Ashish Deep Verma, Advocate.

CORAM: JUSTICE S. MURALIDHAR

ORDER 11.07.2013

I.A. No. 20660 of 2012 (by Defendants under Order XXXIX Rule 4 CPC) and I.A. No. 9360 of 2012 (filed by Plaintiffs under Order XXXIX Rule 1 and 2 CPC)

  

1. The background facts to the present suit have been set out in some detail in the order date 16^th May 2012 passed by this Court in I.A. No. 9358 of 2012 filed by the Plaintiff under Order XXXIX Rules 1 and 2 CPC in paras 9 and 10 which read as under:

"9. As per the plaint, plaintiffs are in the business of manufacturing and marketing goods and products for use in Chess particularly clocks for use in chess matches. Since the year 1993 the plaintiffs have been producing several types of digital clocks and electronic chess boards. The products of the plaintiffs are sold in over 70 countries. One of the most successful products of the plaintiffs is DGT 2010 chess clock, which is the official FIDE chess clock. Plaintiffs are the copyright owners of the drawings/artistic work based on which the DGT FIDE clock was introduced. Plaintiffs are also the owners of packaging in which the clock DGT 2010 is packed and sold. Plaintiffs are advertising its products through their websites www.dgtprojects.com and www.digitalgametechnology.com.

 

10. Learned senior counsel for the plaintiffs submits that the plaintiffs have learnt that defendants have started selling clocks bearing identical trade dress, get up, in the market under a trade mark NEW 2020, which is deceptively similar to the plaintiffs trade mark DGT 2010. Defendants are also selling another model of Chess Clock bearing identical trade dress and get up. Counsel further submits that the defendants not only copied the entire colour combination but also copied all the features including shape/get up, drawings and even the brochure/user manual is identical to the brochure and the manual of the plaintiffs. Senior counsel further submits that in fact defendants’ packaging is a substantial reproduction of plaintiffs’ packaging. In support of his submission, learned senior counsel for the plaintiffs has drawn the attention of the Court to a comparison between clocks of the plaintiffs and the defendants as extracted in the plaint. Senior counsel for the plaintiffs has also produced in Court the original clocks of the plaintiffs and the defendant to show the similarity between both the clocks. Senior counsel next submits that the defendant has adopted a similar trademark NEW 2010 coupled with substantially similar shape and design as that of the plaintiffs DGT 2010 with a view to take undue advantage and ride over the goodwill and reputation of the plaintiffs. Senior counsel in these circumstances prays for ex parte ad interim injunction."

2. The Court accordingly on that day passed an ex parte ad interim injunction restraining the Defendants from selling, advertising, marketing its clocks or any other clock under the names ‘NEW 2020’ and ‘Chess Clock’, and the user manual, the packaging with the present trade dress and the identical features of the DGT 2010 clock.

3. The Court also appointed Local Commissioner (LC) to seize all the infringing products stored in the premises of the Ravi Scientific Industries. The report of the LC has been filed. The LC has, in the report, noted that when a third cupboard in the premises of the Defendants was opened, it had "identical clocks as the plaintiffs under the mark New 2020". Further, the "boxes found were the same on the exteriror as to that of the plaintiff and had a celphene wrapped on the said box". The LC was informed by Mr. Ravi Chadha, Proprietor of the Defendant No.1 that "he had no invoices" as he purchased them from the dealer Mr. Sagar and the money had been transferred from his account. He had been selling these items without bill (5 in number)". The LC also found other boxes which were plain white of identical dimension as that of the Plaintiffs’ DGT 2010 clocks. The covers on the said boxes were labeled as ‘Chess clock’. The picture on the sliding cover was identical to the Plaintiff’s clock DGT 2010. Mr. Chadha informed the LC that "these clocks were assembled here but the parts were imported from China". He also stated that "there were low volumes no margins and there were no account books available". The photographs of the stocks found at the Defendants’ premises have also been enclosed with the report.

 

4. The written statement was filed by the Defendants on 28^th September 2012. The Defendants had also filed an I.A. No. 20660 of 2012 under Order XXXIX Rule 4 CPC on 5^th November 2012 seeking the vacation of the interim orders dated 16^th May 2012.

5. Counsel for the Defendants placed considerable reliance on the decision in Samsonite Corporation v. Vijay Sales 73 (1998) DLT 732 to urge that since registration of the Defendants design had been granted, the suit for passing off would not be maintainable.

 

6. Counsel for the Plaintiff, on the other hand, placed reliance on the judgment of the Full Bench of this Court in Mohan Lal v. Sona Paint & Hardwares MIPR 2013 (2) 156 to contend that notwithstanding the grant of registration of the infringing design a suit for passing off would be maintainable. He also informed the Court that the Plaintiff had taken steps to have the registration of the infringing design in favour of the Defendants cancelled.

 

7. The Court finds the plea of the Defendants unsustainable in law. The majority in Mohan Lal v. Sona Paint & Hardwares has indeed answered the issue against the Defendants. The three issues that arose for consideration in the said decision were:

"I. Whether the suit for infringement of registered Design is maintainable against another registered proprietor of the design under the Designs Act, 2000?

II. Whether there can be an availability of remedy of passing off in absence of express saving or preservation of the common law by the Designs Act, 2000 and more so when the rights and remedies under the Act are statutory in nature?

III. Whether the conception of passing off as available under the Trade Marks can be joined with the action under the Designs Act when the same is mutually inconsistent with that of remedy under the Designs Act, 2000?"

8. The answers to issues 2 and 3, which are relevant to the case on hand, are as follows:

"…….a design can be used as a trade mark and if by virtue of its use, goodwill is generated in the course of trade or business, it can be protected by an action in the nature of passing off."……..

22. In our view, the aforesaid contentions are flawed for the reason that while the Trade Marks Act confers certain statutory rights qua a registered trade mark, it does not deprive a user of an unregistered trade mark the right to protect the misuse of his mark by a defendant who is in possession of a registered trade mark. Therefore, in so far as a design, which is registered under the Designs Act is concerned, it may not have the statutory rights, which a registered trade mark has, under the Trade Marks Act, it would certainly have the right to take remedial steps to correct a wrong committed by a defendant by instituting a passing off action. If such an action is instituted, the plaintiff would have to demonstrate that the registered design was used by him as a trade mark which, in the minds of the purchasing public is associated with his goods or services which, have acquired goodwill/reputation which is worth protecting. Quite naturally, result of such an action, would depend upon whether or not the plaintiff is successful in proving the essential ingredients involved in a passing off action, to which we have already made a reference hereinabove.

 

22.1 Therefore, the argument that since there is no saving clause in the Designs Act as found in Section 27(2) of the Trade Marks Act, and consequently such a remedy ought not to be made available qua a registered design, which is used as a trade mark, is in our view, completely without merit. As is obvious, such a passing off action would be based on a plea that: the design, which is an unregistered mark, was being used by the plaintiff for the purposes of business; and that the plaintiff's goods and/or services had acquired a reputation and/or goodwill, which were identified in the minds of the consumers, by associating the design/the mark, with the goods and/or services. In other words, the plea would be that the design which was being used as a mark identified the plaintiff, as the source of the goods supplied or services offered."

 

9. The Full Bench also approved the decision of the Bombay High Court in Gorbatschow Wodka KG v. John Distilleries Ltd. 2011 (47) PTC 100 (Bom.) and in particular the following passages:

"...15. The fact that the Defendant has obtained registration under the Designs Act, 2000, does not impinge the right of the Plaintiff to move an action for passing off. Section 27(2) of the Trade Marks Act, 1999 provides that nothing in the Act shall be deemed to affect the right of action against any person for passing off goods or services. Section 27(2) is a statutory recognition of the principle that the remedy of passing off lies and is founded in common law.

 

16. Now, in the present case, the material which has been placed on the record by the Plaintiff, prima facie indicates that the Plaintiff has an established trans border reputation and that an integral part of that reputation lies in the shape of the bottle in which Vodka is sold. The shape of the bottle which the Plaintiff has adopted has no functional relationship with the nature sold. The shape, to use the language of a leading authority on the subject, is capricious. It is capricious in the sense that it is novel and originated in the ingenuity and imagination of the Plaintiff. The true test is not as to whether the Defendant took a search from the Design Register. As the first user of the shape, the Plaintiff was not bound to register it under the Designs Act, 2000. If the Defendant knew that the bottles of the Plaintiff with a distinctive shape were in the market -as a prudent person in the trade would know upon a diligent enquiry no amount of search in the Register would bring it within the purview of an honest adoption....

22. The test is whether the shape that has been adopted by the Plaintiff is one that is adopted capriciously, purely to give the article a distinctive appearance or characteristic of the goods of the manufacturer. If that be so, the manufacturer may be able to establish that he has a reputation and goodwill in the distinctive appearance of the article itself which would furnish a cause of action in passing off....

Secondly, under the Trade Marks Act, 1999, the shape of goods and their packaging is statutorily recognized as a constituent element of a trade mark as distinguishing the goods or services of a person with those of others; Thirdly, the submission of the Plaintiff that no other manufacturer either globally or in India has adopted the shape of the bottle of the Plaintiff (save and except for the Defendant) has not been disputed in the course of submissions by counsel for the Defendant; Fourthly the shape which has been adopted by the Plaintiff is unique to the point of being capricious...."

10. Finally, the Full Bench crystallized its answers to the questions in para 34 of the judgment affirmatively holding that "The plaintiff would be entitled to institute an action of passing off in respect of a design used by him as a trade mark provided the action contains the necessary ingredients to maintain such a proceeding. The argument that such a suit could be instituted only after the expiry of the statutory period provided under Section 11 of the Designs Act, does not find favour with us". The Court also answered the issue stating that "a composite suit for infringement of a registered design and a passing off action would not lie".

11. The second plea that no registration of a trademark in relation to the shape of the products could be granted is also tenable. It will always be open to the Plaintiff, as long as it satisfies the Court about the ingredients of a suit for passing off, to maintain such action. The plea that the Plaintiff cannot claim infringement even on the basis of the Copyright Act should also fail for the same reason.

12. Learned counsel for the Defendants admitted that there was no document showing prior user of the infringing design by the Defendants. He also was candid that there were invoices to show that the Defendants’ products were in the market in the past five years.

13. The Court clarifies that the above observations are prima facie in nature and will not influence the final decision of the Court at the conclusion of the trial.

 

14. In the circumstances, the Court finds no reason to vacate the interim injunction granted in favour of the Plaintiff on 16^th May 2012.

15. Accordingly, I.A. No. 20660 of 2012 filed by the Plaintiff under Order XXXIX Rule 4 CPC is dismissed, and I.A. No. 9358 of 2012 filed by the Plaintiff under Order XXXIX Rule 1 and 2 CPC is disposed of by making the interim order 16^th May 2012 absolute during the pendency of the suit.

CS(OS) No. 1414 of 2012
 

16. The following issues are framed:

(i) Have the Plaintiffs made out a case restraining the Defendants from advertising, marketing and selling clocks under the name of ‘NEW 2020’ clock or ‘Chess clock’ and any other clock similar thereto? OPP

(ii) Are the Plaintiffs entitled to a permanent injunction to restain the Defendants infringing the copyright in the artistic work of the Plaintiff in its DGT 2010 clock? OPP

 

 

(iii) What is the effect of the Defendants having obtained registration under the Designs Act in respect of the infringing design? OPP

(iv) Whether there is an infringement of copyright in the user manual and packaging of the Plaintiffs in their DGT 2010 clock by the Defendants by selling, advertising, marketing or making user manual or packaging with its ‘NEW 2020’ clock or ‘Chess clock’ and any other similar clock thereto? OPP

(v) Are the Defendants liable for passing off their products being sold under the mark NEW 2020 and ‘Chess clock’ as that of the Plaintiffs’ DGT 2010 clock? OPP


(vi) Are the Plaintiffs entitled to damages, as prayed for? OPP

(vii) Are the Plaintiffs entitled to register the shape of their products under the Trade Marks Act, 1999 and the effect thereof? OPD

(viii) Relief.

17. No other issue either arises or is pressed.

 

18. List the matter before the Joint Registrar on 25^th September 2013 for admission/denial of documents and for further steps. The affidavits by way

of admission/denial be filed by that date.

　

JULY 11, 2013

WANDER-ANTOX JUDGMENT

 

Comment: I have reproduced the few relevant portion of the judgment, in which case laws has been referred/settled by the Hon’ble Supreme Court of India.

1.         This Judgment has been pronounced by Hon’ble Judge Shri M Venkatachaliah, N O Verma, popularly known as WANDER-ANTOX Judgment.

2.         The object of the interlocutory injunction, it is stated is to protect the plaintiff against injury by violation of his rights for which he could not adequately be compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated. The court must weigh one need against another and determine where the "balance of convenience lies". The interlocutory remedy is intended to preserve in status quo, the rights of parties which may appear on a prima facie. (Para 5).

3.         The court also, in restraining a defendant from exercising what he considers his legal right but what the plaintiff would like to be prevented, puts into the scales, as a relevant consideration whether the defendant has yet to commence his enterprise or whether he has already been doing so in which latter case considerations somewhat different from those that apply to a case where the defendant is yet to commence his enterprise, are attracted. (Para 5).

4.         The appeals before the Division Bench were against the exercise of discretion by the Single Judge. In such appeals, the Appellate Court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. (Para 9).

Wander Ltd. And Anr. vs Antox India P. Ltd. on 26 April, 1990, reported as 1990 (2) ARBLR 399 SC, 1990 Supp (1) SCC 727 The contents of the judgment has been reproduced as herein below:

ORDER

1. Appellants in these appeals by Special Leave, are the Defendants in Civil Suit No. 1220 of 1988 on the original side of the High Court of Madras and assail the order dated 19-1-1990 of the Division Bench of the High Court granting in appeal and in reversal of the order dated 2-3-1989 of the learned single Judge trying the suit an injunction restraining appellants from passing-off their medicinal product Cal-De-Ce as that of the Respondent-Plaintiff, Respondent claimed to have acquired a right in that Trade-mark by continuous user. The temporary injunction was refused by the learned Single-Judge. But in appeals, O.S.A. Nos. 111 and 112 of 1989, preferred against the refusal, the division bench granted the temporary injunction in appeal,

2. The appeals have come up for orders on the prayer for stay. As the considerations relevant for decision on the prayer for stay, by and large, conclude the subject-matter of the main appeals, we proceed to dispose of the main appeals themselves.

We have heard Sri F.S. Nariman, learned Senior Counsel for the appellants and Sri U.N.R. Rao, learned Senior Counsel for the respondents. We have been taken through the orders of the learned trial-Judge and of the Division Bench in appeal.

3. Wander Ltd., first appellant, claiming to be registered proprietor of the Registered Trade-mark Cal-De-Ce entered into an agreement dated 28-3-1986 with Antox India (P) Ltd. (Antox), the respondent, under which Antox agreed to manufacture vitaminsed Calcium Gluconate Tablets under the said registered Trade-Mark Cal-De-Ce and sell the entire production to the Wander Ltd. It would appear that pursuant to and in implementation of these arrangements Antox applied for the requisite manufacturing-license from the Drug Controller under the Drugs and Cosmetics Act, 1940, in the course of the processing of which Wander Ltd. furnished before the Drug Controller an undertaking that Wander Ltd., would not authorize the use of its Trade-Mark Cal-De-Ce by any other company and further not to manufacture Cal-De-Ce with effect from 1st July, 1986, either by itself or under sole licenses from it. The Drug Controller issued the manufacturing licence to Antox.

The working of the agreement dated 28-3-198.6 between the parties, however, appears to have run into serious troubles. It is not necessary to advert to the rival contentions of the parties on the merits of this controversy as they may have to be gone into by the High Court in the pending suit. The disputes culminated in Wander Ltd., purporting to rescind the agreement by its notice dated 30th November, 1988 and calling upon Antox to stop manufacture of Cal-De-Ce under the Trade-mark. It would also appear that Wander Ltd., entered into a separate manufacturing arrangement with Alfred Berg & Co. (I) Pvt. Ltd., the second appellant, at Madras, under licenses issued to the second appellant by the authority administering the Drug and Cosmetics Act, 1940 in that State.

It is at this stage that the Antox came forward with the present suit and sought temporary injunction.

4. The case of Antox is that its agreement dated 28-2-1986 with Wander Ltd., was itself void in that its object was one forbidden by law ; that it would, if permitted defeat and violate several statutory provisions and prohibitions, that the agreement thus, out of way, the undertaking furnished on 21st June 1986 by Wander Ltd., to the Drug Controller in Karnataka, had the effect, in law, of and amounted to an abandonment by Wander Ltd., of its proprietorship of the Registered Trade-Mark Cal-De-Ce and all of such exclusive rights as Wander Ltd., had or may have had in respect of that Trade-Mark and that the subsequent continued user of the said Trade-Mark by Antox under the Drug Controller's licence amounted to an independent user of the Trade-Mark by Antox in its own right as, indeed, according to Antox, the said Trade-Mark after its abandonment by Wander Ltd., came to be in an ascent unwonted condition eligible to be picked up and used by any body. It was said that the user of the Trade-Mark by Antox after 21st of June 1986 amounted to such an independent user on the strength of which Antox claimed that it was entitled to maintain a passing off action even against Wander Ltd. The mere earlier registration of the Trade-Mark by Wander Ltd., it is urged, is no evidence of earlier user and with the abandonment of the Trade-Mark by Wander Ltd. Antox is entitled on the strength of its continuous user, to restrain Wander Ltd. from manufacture.

The point for consideration is whether there is a prima facie case on which Antox could be held entitled to restrain Wander Ltd. and Alfred Berg from manufacturing and marketing goods under the Trade name Cal-De-Ce and whether on considerations of balance of convenience and comparative hardship a temporary injunction should issue. The corollary is that even if the injunction sought by Antox is refused, that does not, ipso-facto, entitled Wander Ltd. and Alfred Berg to manufacture and market the goods if they are not otherwise entitled to do so under the relevant laws regulating the matter.

5. Usually, the prayer for grant of an interlocutory injunction is at a stage when the existence of the legal right asserted by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. The court, at this stage, acts on certain well settled principles of administration of this form of interlocutory remedy which is both temporary and discretionary. The object of the interlocutory injunction, it is stated is to protect the plaintiff against injury by violation of his rights for which he could not adequately be compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated. The court must weigh one need against another and determine where the "balance of convenience lies". The interlocutory remedy is intended to preserve in status quo, the rights of parties which may appear on a prima facie. The court also, in restraining a defendant from exercising what he considers his legal right but what the plaintiff would like to be prevented, puts into the scales, as a relevant consideration whether the defendant has yet to commence his enterprise or whether he has already been doing so in which latter case considerations somewhat different from those that apply to a case where the defendant is yet to commence his enterprise, are attracted.

6. In the present case, the learned single Judge held that, at all events as between Antox and Wander Ltd. even to the extent considerations relevant for a passing-off action go, the latter was undisputably the earlier user of the Trade-Mark in that Wander Ltd. was manufacturing and marketing the Calcium Glouconate Vitamin Tablets under the Trade-Mark Cal-De-Ce at its own factory in Bombay from August 1983 upto June 1986. If this is correct, Antox's user cannot be held to be prior user. It is pertinent to note, and perhaps emphasise, that the appellate bench did not disturb this finding at all. Learned Single Judge was persuaded to the view that, in any event so far as the prima facie position as to the test of earlier user is concerned Antox could not be held entitled to interlocutory order in its favour on the basis of the earlier user claimed by it. The interlocutory relief was accordingly refused against both Wander and Alfered Berg.

7. Aggrieved by this order of the Trial Judge declining the interlocutory injunction Antox preferred O.S.A. Nos. 111-112 of 1989 before the Division Bench. The Division Bench, however, re-assessed the material considered by the single Judge and came to a different conclusion. The Division Bench held :

The plaintiffs had licenses to manufacture for sale with the trade names and had indeed sold the manufactured stock in bulk to the defendants Its user of the trade marks pursuant to the licence obtained, was nut the user of the registered user under Sections 48 and 49 of the Trade and Merchandise Marks Act, not was its manufacture carried out in pursuance of any loan licence taken out by the defendant under rule 69-A of the Drugs and Cosmetics Rules.

The plaintiffs manufacture with the trade names, under licenses in the trade names and the consequent user of the trade names establish a prima facie case for passing off action and the balance of convenience, requiring and the status quo to be maintained, the plaintiff having had the benefit of the injunction from 23-9-1988 till 2-3-1989 when it was vacated and from 2-5-1989 when this Court granted the injunction, the plaintiff would be entitled to have the interim injunction as prayed for by them.

Appellants-Defendants have come up in appeal here.

8. On a consideration of the matter, we are afraid, the Appellate Bench fell into error on own important propositions. The first is a misdirection in regard to the very scope and nature of the appeals before it and the limitations on the powers of the Appellate Court to substitute its own discretion in an appeal preferred against a discretionary order. The second pertains to the infirmities in the ratiocinations as to the quality of Antox's alleged user of the Trade-Mark on which the passing-off action is founded. We shall deal with these two separately.

9. The appeals before the Division Bench were against the exercise of discretion by the Single Judge. In such appeals, the Appellate Court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by the court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the Trial Court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial court's exercise of discretion. After referring to these principles Gajendragadkar, J. in Printers (Mysore) Private Ltd. v. Pothan Joseph :

... These principles are well established, but as has been observed by Viscount Simon in Charles Osention & Co. v. Johnston the law as to the reversal by a court of appeal of an order made by a judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in an individual case.

The appellate judgment does not seem to defer to this principle.

10. We may now examine the tenability of the grounds on which a Division Bench reversed the single Judge's refusal. The passing-off action was based on the asserted right to a trade mark said to have been acquired by continuous user. According to the appellate-bench the user by Antox pursuant to the Drug-Controller's licence and after the under taking given by Wander Ltd. "was not registered user under Sections 48 and 49 of the Trade and Merchandise Marks Act nor was it a manufacture carried out in pursuance of a loan because......" In-passing-off action this would be relevant only in a negative way. Positively, the plaintiff must establish a prior user of his own prima facie. Antox's case appears silent on this requirement in the context of a specific finding of the single judge as to user by Wander Ltd. prior to June, 1986. Antox's user is admittedly after June, 1986.

An infringement action is available where there is violation of specific property-right acquired under and recognised by the statute. In a passing-of action, however, the plaintiff's right is independent of such a statutory right to a trade mark and is against the conduct of the defendant which lends to or is intended or calculated to lead to deception. Passing-off is said to be a species of unfair trade competition or of actionable unfair trading by which one person, through deception, attempts to obtain an economic benefit of the reputation which another has established for himself in a particular trade or business. The action is regarded as an action for deceit. The tort of passing-off involves a misrepresentation made by a trade to his prospective customers calculated to injure, as a reasonably foreseeable consequence, the business or goodwill of another which actually or probably, causes damage to the business or goodwill of the other trader. Speaking of the legal classification of this form of action, Lord Diplock said :

Unfair trading as a wrong actionable at the suit of other traders who thereby suffer loss of business or goodwill may take a variety of forms to some of which separate lables have become attached in English law. Conspiracy to injure a person in his trade or business is one, slander of goods another but most protean is that which is generally and nowadays, perhaps misleadingly, described as "passing off". The form that unfair trading takes will alter with the ways in which trade is carried on and business reputation and goodwill acquired. Emerson's maker of the better mousetrap if secluded in his house built in the woods would today be unlikely to find a path beaten to his door in the absence of a costly advertising campaign to acquaint the public with the excellence of his wares" See Erven Warnink B.V. v. J. Towhand & Sons (Hull) Ltd. 1979 All E.R. 731.

11. Antox says that it is free from the inhibitions of the terms of the agreement dated 28th March 1986 on the ground that agreement is itself void for all purposes and, therefore, do not attach to or diminish the quality of its user, though commenced under that agreement. Antox says its user is referable to the Drug Controller's licence. But even assuming that the terms of the agreement dated 28th March 1986 are not to be put into the scales to determine the title to and character of the user by Antox, two crucial positions still stage Antox in the face.

The first is that the Drug Controller's licence claimed by Antox as the source of its right to the user of the trade-mark, itself expressly stipulates that the goods to be manufactured pursuant to the said licence shall be goods under the registered Trade-mark, of Wander Ltd. The effect of this on the quality of the user has not been examined by the Appellate-Bench.

Secondly, even if a prior registration of a Trade mark is not necessarily evidence of prior user as contended by Sri Raa, Antox cannot, prima facie, explain how in a passing-off action its user subsequent to June 1986 would prevail over the prima facie finding that Wander Ltd. was manufacturing Calcium Gluconate Tablets under the trade-mark Cal-De-Ce at its own factory in Bombay from August 1983 to June 1986. The Appellate Bench does not dislodge this finding nor does it recognise the crucial effect of prior use by the defendant on the plaintiff's case in a passing-off action. It appears to us that it was not an appropriate case where the appellate Bench could have interfered with the discretion exercised by the learned Single, Judge.

12. We, accordingly, allow these appeals, set aside order dated 19-1-1990 of the Division Bench in so far as it pertains to Civil Suit of 1220/ 1988 and restore the order dated 2-3-1989 made by the learned Single Judge on Applications 4941 and 4942 of 1988. Since we are examining the matter at an interlocutory stage, none of the observations contained in this order shall affect the final decision of the suit on the merits after evidence.

13. The order of the appellate Bench is common to the present suit as well as certain other proceedings between Antox on the one hand and certain other parties on the other. This judgment and the observations therein are confined to the facts of Civil Suit No. 1220/1988. The correctness of the Appellate Order in respect of other cases is not the subject-matter of these appeals and that, therefore, whatever we have said shall not prejudice the parties in those other proceedings.

Having regard to the nature of the controversy, it will be appropriate for the High Court to dispose of the Suit expeditiously and we request the High Court to dispose of the Suit within six months from today.

In the circumstances of this case, there will be no orders as to costs in the appeals.

Antox (India) Pvt. Ltd. v. Wander Ltd.

1. We have heard Sri U.N.R. Rao, learned Senior Counsel for the appellant and Sri F.S. Nariman, learned Senior Counsel for the respondent.

Special leave granted.

2. The grievance of the appellant is that its appeal before the Learned Single-Judge of the High Court preferred against an interlocutory order granting an injunction in a suit pending on the file of the District Court Baroda was disposed of without giving opportunity to the learned Counsel for the appellant to argue the matter.

3. The matter admits of being disposed of on the basis of Sri Nariman's suggestion which we consider a fair and generous one. Sri Nariman for the respondent fairly consents to an order-and we accordingly make that order-setting aside the order under appeal and remitting the matter to the High Court for consideration afresh of the appeal for admission after affording another opportunity to the appellant of being heard. The matter is disposed of accordingly. No costs.