POLYFLOR LIMITED Versus SH. A.N. GOENKA & ORS

IN THE HIGH COURT OF DELHI AT NEW DELHI

+	Date of Decision: 18.04.2016
% CS(OS) 504/2004
POLYFLOR LIMITED		..... Plaintiff
Through:	Sushant Singh, Kumar Chitranshu and
	Harsh Pathak, Advocates
versus
SH. A.N. GOENKA & ORS.	DA+	..... Defendants
Through:	Ajay Amitabh Sharma, Advocate

CORAM:

HON'BLE MR. JUSTICE VIPIN SANGHI

VIPIN SANGHI, J. (OPEN COURT)

O.A. No.84/2016

1. This chamber appeal is directed against the order dated 16.03.2016 passed by the learned Joint Registrar dismissing the application preferred by the plaintiff under Order 7 Rule 14(3) CPC i.e. I.A. No.1446/2016. The suit seeking permanent injunction, passing off, delivery up and unfair trade practices and rendition of accounts was filed by the plaintiff in April 2004. The issues in the suit were framed on 02.12.2013. The recording of evidence is in progress before the Local Commissioner. The plaintiffs witness PW-1 has been under cross examination. At that stage the plaintiff moved the aforesaid application under Order 7 Rule 14(3) CPC seeking to

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place on record three sets of documents relating to the audited statement of accounts of the plaintiff. These documents were sought to be produced to substantiate the sales figures and turnover of the plaintiffs under the trademark POLYFLOR since 1997, upto 2013.

2.The first set of documents sought to be produced are photocopies of annual report of the plaintiff, which includes the annual report of its predecessor, for the year 1997-99. The second set is the original duly audited annual report for the year ending 30.06.2001 and 30.06.2003. The third set of original annual reports are of the plaintiff company for the years ended on 30.06.2005, 2007, 2009, 2011 and 2013.

3.The learned Joint Registrar in his order takes note of the fact that the original suit was filed in the year 2004; the documents sought to be produced were neither filed alongwith the plaint, nor at the stage of admission/denial of documents, nor even at the stage of framing of issues on 02.12.2013; PW-1 is under cross examination and had been substantially cross examined when the application was moved on 27.01.2016. The learned Joint Registrar has observed that vague and non convincing reasons have been given by the plaintiff for not filing the documents earlier, and unjustifiable reason has been given as to why, when the documents were in the domain and control of the plaintiff, the same were not filed at the appropriate stage, or even at the stage of framing of issues.

4.So far as the documents pertaining to the years after 2004 are concerned, the Joint Registrar has also observed that they do not appear to be relevant, as they reflect the sales figures post the filing of the suit,

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whereas the claim of the plaintiff for damages upon rendition of accounts is limited to Rs.20 lacs, which would have to be substantiated on the basis of the claim of sales/goodwill for the period prior to the filing of the suit.

5.The submission of learned counsel for the petitioner is that the stage at which the application under Order 7 Rule 14(3) was moved is not relevant. What is relevant to be examined is whether the documents are germane. It also needs to be appreciated that the documents are audited accounts of the plaintiff company, and their authenticity is beyond doubt. Learned counsel submits that no prejudice would have been suffered by the defendant even if the plaintiff was permitted to place on record the additional documents at this stage, and the defendant could have been compensated by way of costs for the inconvenience suffered.

6.Learned counsel submits that the power of the court to permit filing of additional documents at any stage of the proceedings is not taken away under the law, and in the interest of justice, the court can grant permission to produce additional documents even at the final stage of proceedings, and even at the appellate stage. In support of his submission, he has placed reliance on a judgment of the Division Bench of Bombay High Court in

Smt. Shantibai K Vardhan v. Meera G Patel, Appeal No.86/2008 decided

on 29.08.2008.

7.Learned counsel for the defendants has appeared even before issuance of notice in this chamber appeal, and he has advanced his submissions.

8.Learned counsel for the defendants submits that there is absolutely no justification for seeking leave to produce the aforesaid documents at this

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highly belated stage, when the cross-examination of the PW-1 is underway, and has substantially been completed. He points out that nearly 140 questions have already been put to PW-1. Learned counsel submits that the documents sought to be produced are the plaintiff’s own documents, namely purported annual reports/ financial statements from 1997 till 2013. Obviously, the plaintiff could have produced the documents available for the period up to the date of filing of the suit in 2004, along with the suit, and for the period thereafter, till as late as issues were framed in 2013. There is no explanation furnished as to why it is claimed that the plaintiff could not discover that the statement of accounts from 1997-98 onwards. The applicant/ plaintiff claims that the annual reports/ financial statements for 1997, 1998 & 1999 were not traceable and available with the plaintiff, and had been lost. However, there is no disclosure as to when the said annual reports/ financial statements were lost, and from where the copies, which are now sought to be produced, have become available.

9. Similarly, in relation to the annual reports for the period between 2000 to 2004, there is no explanation as to why it is claimed that the plaintiff could not gather the report for the year 2000. Learned counsel submits that on a perusal of the plaintiff’s application, it is evident that the plaintiff is guilty of not exercising due diligence in the matter of producing the documents, which are now sought to be produced at this highly belated stage.

10. Learned counsel for the defendants has sought to place reliance upon the judgment of this Court in Gold Rock World Trade Ltd. Vs. Veejay

Lakshmi Engineering Works Ltd., (2008) 149 PLR 40 in support of his

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submissions.

11.The plaintiff has claimed damages by alleging passing off by the

defendants of its trademark “POLYFOR”. The plaintiff is now seeking to produce the aforesaid documents, namely copies of the annual reports for the period from 1997 onwards to substantiate its plea with regard to the sales, popularity and goodwill enjoyed by the plaintiff in respect of its trademark “POLYFOR”.

12.Order VII Rule 14 (1) provides that: “Where a plaintiff sues upon a document or relies upon document in his possession or power in support of his claim, he shall enter such documents in a list, and shall produce it in court when the plaint is presented by him and shall, at the same time deliver the document and a copy thereof, to be filed with the plaint”.

13.Sub-rule (2) of Order VII Rule 14 provides that: “Where any such documents not in the possession or power of the plaintiff, he shall, wherever possible, state in whose possession or power it is”.

14.Thus, when the suit was filed, the plaintiff was obliged to produce all documents which it sought to rely upon in its power and possession. If, according to the plaintiff, the annual reports from 1997 to 2003-04 were not available with it, under Order VII Rule 14 (2), the plaintiff was obliged to state in whose possession and power the said documents, namely, the annual reports, were.

15.During the course of submissions, learned counsel for the plaintiff has submitted that under the law, as prevalent in United Kingdom, the plaintiff

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was obliged to maintain the financial statements for the period of seven years. The suit was filed in the year 2004. Therefore, the plaintiff was obliged to have in its power and custody the annual reports from 1997 onwards. The plaintiff did not make any disclosure under Order VII Rule 14

(2) in the plaint, or any other document, at the time of filing of the suit that it is not in possession of its annual reports. The statement has now come, for the first time, in the present application in the year 2016.

16. Order VII Rule 14 (3) mandates that: “A document which ought to be produced in Court by the plaintiff when the plaint is presented, or to be entered in the list to be added or annexed to the plaint but is not produced or entered accordingly, shall not without the leave of the Court, be received in evidence on his behalf at the hearing of the suit”. Thus, as a matter of rule, the plaintiff is prohibited from leading in evidence a document which he ought to have produced when the plaint was presented. The exception to this rule is that, where the Court grants leave to the plaintiff, the document may be permitted to be led in evidence at the hearing of the suit.

17. Thus, the issue is, whether in the above noted facts and circumstances, the plaintiff is entitled to grant of such leave. In the present case, the plaintiff’s witness PW-1 is under cross-examination and has already undergone a substantial portion of his cross-examination. To grant leave to, and permit the plaintiff to file and lead in evidence additional documents at this stage would mean that the defendants would be put to serious prejudice. The defendants have not had the occasion to deal with the said documents. Had the documents now sought to be produced, been produced at the relevant time, i.e. at the stage of filing of the suit, or at least at the time when

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the issues were framed, the defendants would have had the occasion to deal with the same by making appropriate pleadings and filing its own documents to counter the reliance placed by the plaintiff on the documents in question.

18.The progress of the suit cannot be interdicted on account of the blatantly casual approach of the plaintiff. The plaintiff has not given any justifiable and acceptable explanation for not filing the said documents at the earlier stage of the proceedings. If the submissions of the plaintiff were to be accepted, it would mean that in every case, a party should be permitted to lead in evidence documents not earlier filed and relied upon at any stage of the proceedings.

19.The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 provides under Order XI Sub- rule (1) of Rule 1 contained in its Schedule that: “Plaintiff shall file a list of all documents and photocopies of all documents, in its power, possession, control or custody, pertaining to the suit, along with the plaint, including:—

(a) documents referred to and relied on by the plaintiff in the plaint; (b) documents relating to any matter in question in the proceedings, in the power, possession, control or custody of the plaintiff, as on the date of filing the plaint, irrespective of whether the same is in support of or adverse to the plaintiff’s case;”.

20.Sub-rule (5) of Rule 1 states that: “The plaintiff shall not be allowed

to rely on documents, which were in the plaintiff’s power, possession, control or custody and not disclosed along with plaint or within the extended period set out above, save and except by leave of Court and such

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leave shall be granted only upon the plaintiff establishing reasonable cause for non–disclosure along with the plaint”. Thus, the plaintiff has to establish a reasonable cause for non-disclosure of the documents now sought to be produced along with the plaint.

21.As aforesaid, there is no cause shown, much less a reasonable cause for non-disclosure of the documents and non-filing of the documents, or at least copies thereof along with the plaint, or even till the stage of framing of the issues.

22.Reliance placed by learned counsel for the plaintiff on the decision in

Smt. Shantibai K Vardhan (supra) is of no avail. In this case, the Division Bench was dealing with an appeal from an order passed by the learned Single Judge, whereby the learned Single Judge had granted leave to the defendant to lead evidence and place on record certain documents referred to in the affidavit of documents filed by the defendant. The factual background of the said case was that the plaintiffs had filed a suit for specific performance on 16.01.1979. On 25.03.1980, the defendants had filed their written statement. Pertinently, in February, 1995, an affidavit of documents was filed by the defendants giving a list of 59 documents which were referred to and relied upon by the defendants. The plaintiffs led their evidence on the issues which had been framed, whereafter the evidence was closed by the plaintiffs. The defendants made a statement that they do not wish to lead evidence. The matter was taken up for final disposal, and during the course of hearing, the plaintiffs were advised to amend their plaint. Accordingly, they sought amendment of the plaint. The said application was allowed on 16.06.2007 and, significantly, direction was

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given to both the parties that they were at liberty to lead evidence, if advised

and necessary on the basis of the pleas raised in the amended plaint, as well

as in the written statement. In this background, the defendants moved an

application seeking to lead detailed evidence. It was this application which

was allowed by the learned Single Judge, and against the said order of the

learned Single Judge the appeal was preferred before the Division Bench.

The Division Bench, while dismissing the appeal, took into account the

aforesaid facts & circumstances. The Division Bench, inter alia, observed

in paragraph 12 as follows:

“12. … … … In the present case, it has to be noted that affidavit of documents was filed by the defendants. The documents could not be traced and, subsequently, the defendants were in a position to procure the said documents and, after an application for amendment which was filed by the plaintiff was allowed and permission was granted to the parties to file additional written statement, the application for production of documents was made and the learned Single Judge was pleased to allow the said application.”

23.From the above, it would be seen that the documents which had been referred to and relied upon by the defendants, as early as in 1995, were sought to be produced and lead in evidence by the defendants. The occasion for the same had arisen as the plaintiffs had been permitted to amend the plaint, and leave had been granted by the Court to both the parties to lead further evidence. However, the fact situation in the present case is entirely different, and therefore, the decision in Smt. Shantibai K Vardhan (supra) has absolutely no application in the facts of the present case.

24.In Gold Rock World Trade Ltd. (supra), a similar application under

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Order VII Rule 14 had been moved before the Court for production of

additional documents and for filing an additional affidavit. The stage in the

said suit was more or less the same, namely that the plaintiff had led its

evidence in the affirmative and closed the same. The application had been

filed prior to the defendants’ witnesses filing their affidavits by way of

evidence towards examination-in-chief. The learned Single Judge rejected

the application of the plaintiff. While doing so, the learned Single Judge

observed:

“3. ... ... ... A plain reading of Order 7 Rule 14 (3) makes it clear that a document which ought to be produced in Court by the plaintiff when the plaint is presented, or to be entered in the list to be added or annexed to the plaint but is not produced or entered accordingly, shall not, without the leave of the Court, be received in evidence on his behalf at the hearing of the suit. The learned counsel for the plaintiff submits that leave of the Court ought to be granted to the plaintiff for producing the additional documents referred to in the application under Order 7 Rule 14 and as also for calling the witness for producing the documents mentioned in the other application. The learned counsel for the plaintiff referred to the decision of the Supreme Court in the case of Salem Advocate Bar Association, Tamil Nadu v. Union of India: (2005) 6 SCC 344. With reference to paragraph 13 thereof, the learned counsel submitted that the Court may permit leading of such evidence even at a later stage subject to any terms that may be imposed upon by the Court which may be just and proper.

4. I have heard counsel for the parties. The Supreme Court decision in Salem Advocate Bar Association (supra) was in the context of additional evidence. By virtue of the 1976 amendment, Rule 17-A had been introduced in Order 18. The

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said Rule 17-A granted discretion to the Court to permit production of evidence not previously known or which could not be produced despite due diligence. Rule 17-A of Order 18 was deleted by the Code of Civil Procedure (Amendment) Act, 1999 which took effect on 1.7.2002. While considering the effect of this deletion the Supreme Court observed:-

“13. In Salem Advocate Bar Assn. (I) v. Union of

India, (2003) 1 SCC 49, it has been clarified that on deletion of Order 18 Rule 17- A which provided for leading of additional evidence, the law existing before the introduction of the amendment i.e. 1-7-2002, would stand restored. The Rule was deleted by Amendment Act of 2002. Even before insertion of Order 18 Rule 17-A, the court had inbuilt power to permit parties to produce evidence not known to them earlier or which could not be produced in spite of due diligence. Order 18 Rule 17-A did not create any new right but only clarified the position. Therefore, deletion of Order 18 Rule 17- A does not disentitle production of evidence at a later stage. On a party satisfying the court that after exercise of due diligence that evidence was not within his knowledge or could not be produced at the time the party was leading evidence, the court may permit leading of such evidence at a later stage on such terms as may appear to be just.”

Thus, the Supreme Court held that the insertion of Rule 17-Awas only clarificatory of the in-built power of the Court to permit parties to produce evidence not known to them earlier or which could not be produced in spite of due diligence. The learned counsel for the plaintiff sought to invoke this in-built

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power of the court even in respect of Order 7 Rule 14 (3) which relates to production of documents at a belated stage. There would be no difficulty in holding that the in-built power referred to in the said Supreme Court decision could also be invoked when the question of granting leave arises in the context of Rule 14 (3) of Order 7. Consequently, before leave of the Court can be granted for receiving documents in evidence at a belated stage, the party seeking to produce the documents must satisfy the Court that the said documents were earlier not within the party's knowledge or could not be produced at the appropriate time in spite of due diligence. It has been submitted by the learned counsel for the defendant that the documents pertain to a settlement between the plaintiff and a foreign party (COGETEX). The settlement was arrived at, as per the statement recorded in the crossexamination of PW1, on 7.10.1996. However, there is not a whisper of this statement even in the replication which was filed on 11.9.1997. In fact, the affidavit by way of evidence was filed by the plaintiff in the year 2003 and even in that affidavit, there is no reference to the documents which are now sought to be introduced. In my view, these circumstances clearly show that the conditions necessary before leave of the Court can be granted have not been satisfied. It cannot be said that the plaintiff was not aware of the documents earlier, or that the same could not be produced in spite of due diligence on the part of the plaintiff. All the material now sought to be introduced, was well within the knowledge of the plaintiff at least in the year 2003. As the plaintiff was not diligent enough at that point of time, this Court is left with no alternative but to reject its request.”

(emphasis supplied)

25. In my view, the aforesaid judgment squarely applies to the facts of the present case. It cannot be said by the plaintiffs that they were not aware of

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the existence of their own audited annual reports from 1997 onwards till 2013. Since the said annual reports are of the plaintiffs themselves, and even according to the plaintiffs, the plaintiffs are obliged to maintain the records for a period of seven years under the law applicable to the plaintiff company, it cannot be said that in spite of due diligence, the plaintiffs could not have produced the said documents at the time of filing of the suit in respect of the period 1997 to 2004, and for the period thereafter till the time of framing of issues in 2013. Not only these documents, or even copies, therefore, were not filed earlier, they were not even referred to or relied upon either in the pleadings, or in any other document filed by the plaintiff.

26. Thus, I find absolutely no merit in the present chamber appeal and dismiss the same, leaving the parties to bear their respective costs.

VIPIN SANGHI, J

APRIL 18, 2016

sr / B.S. Rohella

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M/S Khushi Ram Behari Lal Versus P.V Kanakaraj

       IN THE HIGH COURT OF DELHI AT NEW DELHI

                         CS (OS) 2605/2013

        M/s KHUSHI RAM BEHARI LAL                    ..... Plaintiff
                      Through: Mr. Ajay Amitabh Suman, Mr. Amit
                      Chanchal Jha and Mr. Vinkay Kumar Shukla for
                      Mr. S.K. Bansal, Advocates.

                           versus

        P.V KANAKARAJ TRADING AS KALPATHARU
        TRADING CO.                                  ..... Defendant
                     Through: Mr. Manish Gandhi, Advocate.

        CORAM: JUSTICE S. MURALIDHAR

                           ORDER

16.09.2016 IA No. 5529/2014 (under Order VII Rule 11 CPC)

1. This is an application under Order VII Rule 11 CPC filed by the Defendant seeking rejection of the plaint on the ground that the Plaintiff has sought to combine two causes of action i.e., one for passing off of the trademark and the other for infringement of copyright without there being necessary basic averments in the plaint as to how the causes of action for the said reliefs have arisen within the territorial jurisdiction of this Court.

2. It is not in dispute that in the present suit the Plaintiff, having its registered office at 5190, Lahori Gate, Delhi-110006 and its corporate office at 81-B, Central Avenue, Sainik Farm, New Delhi-110062, is seeking two reliefs against the Defendant located in Karnataka. One is for a permanent injunction to restrain the Defendant from passing off its trademark with device of „Taj Mahal‟ used on the rice sold by it as that of the Plaintiff which uses a nearly similar mark on the Basmati rice sold by it in the domestic market and exported by it outside India. The other relief is for a permanent injunction to restrain the Defendant from infringing the Plaintiff's copyright in the said trade label with device.

3. As far as the suit for infringement of the copyright is concerned, it is again not in dispute that by virtue of Section 62 (2) of the Copyright Act, 1957, the Plaintiff can institute the present suit in this Court notwithstanding that the Defendant has its office and is carrying on its business in Bangalore, Karnataka.

4. The controversy then is as regards the relief of passing off. The case of the Plaintiff as spelt out in para 37 of the plaint reads as under:

"37. That this Hon‟ble Court has the territorial jurisdiction to try and adjudicate the present suit. The defendant is selling the impugned products under the impugned Trade Mark TAJ MAHAL WITH DEVICE OF TAJ MAHAL within the territorial jurisdiction of this Hon‟ble Court i.e. Lahori Gate, Alipur etc. and other part of Delhi. The Defendants impugned acts of infringement of copyright and passing off are taking place in Delhi i.e. within the jurisdiction of this Hon'ble High Court. The cause of action in whole and for in part has arisen within the jurisdiction of this Hon‟ble Court.

Besides this, the Plaintiff is having its Registered Office at 5190 Lahori Gate, Delhi-110006. The Plaintiff's corporate office is situated at 81-B, Central Avenue, Sainik Farm, New Delhi-110062 which is its nerve centre and from where the Plaintiff has been controlling each and every aspect of its said goods and business under their said Trade Mark/Label. The Plaintiff is also working for gain and carrying on its said goods and business within the territorial jurisdiction of this Hon'ble Court. This Hon'ble Court as such also has a jurisdiction to try and adjudicate the present suit by virtue ofSection 62(2) of the Copyright Act 1957."

5. The submission of Mr. Manish Gandhi, learned counsel for the Defendant, based on the decisions in Dabur India Ltd. v. K. R. Industries AIR 2008 SC 3123, Dhodha House v. S.K. Maingi(2006) 9 SCC 41 and Lakhan Pal Shyam Kumar v. Ram Prasad Gupta 190 (2012) DLT 659 is that the above averments are too general and vague and not sufficient to enable this Court to exercise jurisdiction as regards the relief of passing off. According to Mr. Gandhi, the Plaintiff ought to have given particulars of where it found the Defendant to be selling its products in Delhi. He submits that merely stating that the Defendant was selling the impugned products at Lahori Gate, Alipur and several parts of Delhi is insufficient.

6. On the other hand, Mr. Ajay Amitabh Suman, learned counsel for the Plaintiff, seeks to place reliance on a recent decision dated 3rd August, 2016 of the Division Bench (DB) of this Court in FAO (OS) 145/2016 (M/s RSPL Limited v. Mukesh Sharma) where while setting aside the judgment dated 5th April, 2016 of the learned Single Judge which had allowed the application of the Defendant in that matter under Order VII Rule 10 CPC on the ground that the averments in the plaint regarding the cause of action which had arisen within the jurisdiction of this Court were bereft of particulars, the DB relied on the decisions in Exphar SA v. Eupharma Laboratories Limited (2004) 3 SCC 688 and Om Prakash Srivastava v. Union of India (2006) 6 SCC 207 held that the facts pleaded by the Plaintiff must be taken to be true while considering the objection as to territorial jurisdiction under Order VII Rule 10 CPC. Once there were averments to the effect that the Defendant was 'conducting, soliciting, rendering the impugned services with the impugned trade name' within the territorial jurisdiction of the Court, "then it follows that this Court would have to proceed with the trial of the suit and cannot return the plaint under Order VII Rule 10 CPC."

7. This Court agrees with learned counsel for the Plaintiff that for the purposes of the relief of passing off, the above averments in para 37 of the plaint that the Defendant was selling the impugned products under the impugned trademark was within the territorial jurisdiction of this Court have to be taken to be correct. In Dhodha House (supra), the focus of the Court was on the question whether the Plaintiff in that case carried on the business in Delhi. In para 51 the Supreme Court observed:

"For our purpose, the question as to whether the Defendant had been selling its produce in Delhi or not is wholly irrelevant. It is possible that the goods manufactured by the plaintiff are available in the market of Delhi or they are sold in Delhi but that by itself would not mean that the plaintiff carries on any business in Delhi."

8. It was in that context that the Supreme Court observed that the mere fact that goods may be available in Delhi was insufficient to infer that the Plaintiff was carrying on business in Delhi. In the present case, however, the specific averment is that the Defendant "is selling the impugned products under the impugned Trade Mark TAJ MAHAL WITH DEVICE OF TAJ MAHAL within the territorial jurisdiction of this Court." Consequently, the above decision is of no assistance to the Defendant.

9. In Dabur India Ltd. v. K. R. Industries (supra), the facts were that a composite suit was filed for both infringement of copyright and for the relief of passing off of the trademark. The learned Single Judge held that as far as the passing off action was concerned, this Court did not have territorial jurisdiction as there was no documentary evidence to show that the Defendant, located in Andhra Pradesh, was selling goods in question in Delhi. This view concurred with by the DB and further by the Supreme Court. It is, however, not clear what the precise averments in the plaint were as they have not been set out in the judgment by the Supreme Court. The Supreme Court appears to have proceeded on the basis that the averments in the plaint were insufficient for the Court to come to a conclusion that the Defendant was selling its goods in Delhi. The above decision does not alter the settled legal position that for the purposes of Order VII Rule 10 CPC, the averments in the plaint will have to be taken to be correct.

10. Likewise, in Lakhan Pal Shyam Kumar v. Ram Prasad Gupta (supra), although the precise averments in the plaint in that case on the aspect have not been set out in the judgment itself, a careful reading reveals that the averments were indeed too general and insufficient to infer even prima facie that the Defendant was carrying on business within the territorial jurisdiction of the Court.

11. At the present stage, when the matter is yet to go to trial, the Court cannot insist that the full particulars of where precisely the Defendant was found selling its products in Delhi have to be set out in the plaint itself. That would be a matter for evidence. Consequently, this Court is unable to accept the plea of the Defendant that the averments in the plaint are insufficient for the Court to entertain the action of passing off of the trademark of the Plaintiff.

12. The application is accordingly dismissed.

I.A. No. 8938 of 2014

13. This is an application under Order XXXIX Rule 4 CPC filed by the Defendant seeking to vacate the interim injunction against the Defendants restraining them from using the trademark and label „Taj Mahal‟ in respect of the rice being sold by the Defendant.

14. The necessary facts to be noticed for the purposes of this application are that the Plaintiff has adopted the said mark in relation to Basmati Rice. The Plaintiff has been engaged in the business of processing and marketing of Basmati Rice including exports thereof. In the plaint, the Plaintiff has set out the total exports/sales figures since 1980-81 as well as the domestic sales figures. Inter alia it is averred that for the year 2008-09 the total exports/sales were Rs. 366. 23 crores and the domestic sales were Rs.275.21 crores. It is stated that the sales of Basmati Rice under the above trademark with label/device of „Taj Mahal‟ is approximately 10% of the abovementioned sales. The Plaintiff states that it filed an application for registration of the aforementioned mark with Taj Mahal label (Device of Taj Mahal) in Class 30 in relation to rice for exports on 27th February, 1989 claiming user since 1st January, 1978. However, this was opposed by M/s. New Bharat Rice Mills („NBRM‟), one of the competitors of the Plaintiff, on the ground that it already held registrations in respect thereof. The Plaintiff then filed a civil suit before this Court for cancellation of registration granted in favour of NBRM in respect of the said mark and label. It is stated that the said suit is still pending adjudication. Meanwhile the appeal filed by NBRM against the rejection of its opposition was allowed by the Intellectual Property Appellate Board (IPAB). It is, however, pointed out by the Plaintiff that the said order of the IPAB has been stayed by this Court in a writ petition filed by the Plaintiff.

15. The Defendant contends that the Plaintiff has not yet succeeded in obtaining registration of the said mark/label and, therefore, does not have the locus standi to maintain the present suit and obtain an interim order against the Defendants in the action for passing off. Secondly, the Defendant refers to the fact that there are many other entities that hold registration in their favour for identical mark and label in different classes including Class 30 for rice in particular. Therefore, the Plaintiff cannot claim exclusivity for such mark and label. Thirdly, the Plaintiff itself limited its application for registration to exports of Basmati Rice. Therefore it cannot seek protection as regard its domestic sales of the product. The other plea is that of acquiescence. It is stated that the Defendant has been using the device Taj Mahal on the rice being sold by it since 1 st January, 2000 and has also filed an application for trademark registration on 15th April, 2010. This was not objected to by the Plaintiff.

16. The above submissions have been considered. In the first place, it is trite that an action of passing off does not hinge upon the Plaintiff having a registration of the mark and/or label in its favour. Therefore, the fact that its application for registration has been opposed or not granted or that others may hold registration is of no consequence. In order to succeed in the action for passing off, the Plaintiff has to inter alia show that its mark and label enjoy a reputation and goodwill in relation to the goods in question and that the adoption of the same or similar said mark or label by the Defendant for the good in the same channel of trade is dishonest. The fact that the Plaintiff is a prior and continuous user of the mark/label in relation to the goods in question, which, in the present case, is rice, is certainly a relevant factor. This, the Plaintiff has certainly been able to demonstrate by setting out the figures of its sales both exports and domestic for several years since 1980-

81.

17. Second, the Plaintiff has to show that the adoption of the impugned mark by the Defendant is dishonest. The fact of the matter is that an essential feature of the Plaintiff‟s marks i.e., the trademark „Taj Mahal‟ with the device of „Taj Mahal‟ has been in toto adopted by the Defendants and for the same basic product i.e. rice. In relation to such product the trade mark Taj Mahal with device can be said to be an arbitrary mark with a degree of distinctiveness that enables the consumer to associate the product with the producer of the product. In this context, prima facie the Plaintiff has been able to show that it is the prior and continuous user since 1978 and that the subsequent adoption of an identical mark and label by the Defendant, which admittedly commenced its business only in 2000, is dishonest.

18. Thirdly, the mark and label used by the Defendant i.e. Taj Mahal with the device for rice is prima facie bound to cause deception and confusion in the mind of the average purchaser of rice and is an attempt to exploit the reputation and goodwill attached to Plaintiff in the said mark and device for rice. It is in the same channel of trade. There is also no merit is the plea of acquiescence. The Plaintiff states it has filed an opposition to the Defendant's application for registration. As far as the plea that the Plaintiff‟s alleged use of the impugned trademark is confined to export of rice only, the averments in the plaint show that the Plaintiff has been selling rice in the domestic market under the trademark, label and device „Taj Mahal‟ since 1980-81.

19. Consequently, no grounds are made out by the Defendants for vacating the interim injunction granted by this Court by the order dated 19 th December, 2013. This application under Order XXXIX Rule 4 CPC is accordingly dismissed.

IA No. 20906/2013 (under Order XXXIX Rules 1 and 2 CPC)

20. The interim injunction granted by this Court on 19 th December, 2013 is made absolute during the pendency of the suit. The application is disposed of.

CS (OS) No. 2605/2013

21. To be re-numbered as a commercial suit.

22. List before the Joint Registrar on 22nd December, 2016 for admission/denial of documents.

23. List before the Court on 6th March, 2017 for framing of issues.

S. MURALIDHAR, J SEPTEMBER 16, 2016 dn