Mahalaxmi Aluminium Industries v. Tirthamoyee Aluminium Products
1999-02-25
D.N.CHOWDHURY
body1999
DigiLaw.ai
This appeal is directed against an order of injunction dated 19.9.98, passed by the learned District Judge, West Tripura in Civil Misc Case No.212 of 1998, restraining the appellants from selling Aluminium utensils manufactured by them. 2. The appeal arises out of the following facts and circumstances: The respondent herein, as plaintiff, instituted a suit for passing off action against the defendants/appellants restraining them from using the trade label which was alleged to be deceptively similar to that of the plaintiff, under section 27 (2) of the Trade and Merchandise Products Act, 1958. The plaintiffs further sought for a declaration that the plaintiffs were the absolute proprietor and exclusive users of the trade label of 'a bird in flying condition' on their products of Aluminium utensils and also sought for permanent injunction. The plaintiffs inter alia pleaded that the plaintiff-firm was established in the year 1963. From the date of manufacturing of Aluminium products under the name and style Tirthamoyee Aluminium Products', the plaintiffs used the trade mark as aforesaid on their products continuously and unobstructively for a few decades. The products of the plaintiff-firm under the label of 'a bird in flying condition' popularly known to the public as 'Dana Mela Pakhi' became associated in the minds of the public and the potential buyers of Aluminium utensils. In the month of January, 1998, some whispers were spread in the trading areas and markets that the plaintiff's Aluminium utensils products under the label of 'Dana Mela Pakhi' were sold and marketed under the brand name of 'Parrot'. On enquiry, the plaintiffs found c that these Aluminium products in design, get up, size, colour, etc were identical with or deceptively similar and/or confusingly similar to the plaintiffs' utensil products in Aluminium as those of the plaintiffs' Aluminium utensil products in all manners and kinds.
On enquiry, the plaintiffs found c that these Aluminium products in design, get up, size, colour, etc were identical with or deceptively similar and/or confusingly similar to the plaintiffs' utensil products in Aluminium as those of the plaintiffs' Aluminium utensil products in all manners and kinds. The plaintiffs also pleaded that after due enquiry, being convinced that the products of the defendants which also embossed the mark of a 'bird in flying condition', were almost visually similar and causing confusion to trading community as also the customers of Aluminum utensil products and on failure to persuade the defendants at personal level, served notices upon them through their Advocate asking the defendants to desist from marketing and selling Aluminium utensil products using the mark of 'a bird in flying condition' as manufactured by the defendants and the defendants in spite of service of Advocate's notice, did not stop manufacture and sale of Aluminium utensil products with the trade label as mentioned above and hence, the plaintiffs instituted the suit before the trial Court on 12th August, 1998 and the learned trial Curt registered the said case as Title Suit (Trade Mark) No. 1 of 1998. The learned trial Court also passed ah exparte ad-interim temporary injunction order on 12.8.98. The defendants appeared and filed objections denying and disputing the claim of the plaintiffs. By an order dated 26.8.98, passed in Misc Case No. 212 of 1998, the plaintiffs were granted a temporary injunction order and the trial Court finally took up the petition of the plaintiffs pertaining to the injunction matter and by its order dated 19.9.98, held that the plaintiffs to be the prior user of the trade mark and made the exparte temporary order dated 26.8.98, absolute. Hence the appeal. 3. Mr. DK Bis was, learned counsel appearing on behalf of the appellants submitted that the impugned order of injunction, on the facts and circumstances of the case, was/is not only unwarranted, but the same is seemingly arbitrary and capricious requiring interference in appeal. Mr. Bis was, the learned counsel for the appellants, referring to the pleadings, submitted that no case was ever made out for issuing an injunction which seriously jeopardised the livelihood of the appellants/defendants. The learned counsel for the.
Mr. Bis was, the learned counsel for the appellants, referring to the pleadings, submitted that no case was ever made out for issuing an injunction which seriously jeopardised the livelihood of the appellants/defendants. The learned counsel for the. appellants stated that the Court below in passing the injunction order, failed to distinguish between an action for passing off from that of infringement of a registered trade mark. Mr. Bis was further submitted that the learned Court below acted mechanically in exercising its discretion overlooking the fact that the plaintiffs approached the Court after a lapse of a long period of time. 4. Mr. AM Lodh, learned counsel appearing for the respondent/plaintiff, firstly submitted that since the learned Court below exercised its judicial discretion and reached its conclusion on the basis of the materials on record, the appellate Court keeping in mind the accepted norms in an appeal against a discretionary order, should loath to interfere in such a proceeding. The learned Court below had taken into consideration the respective cases of both the parties and found that the plaintiff was/is a prior user of the trade label and that the appellants/ defendants resorted to deception to pass off their products by using similar trade mark as that used by the plaintiffs in their products. That since the learned trial Court exercised the jurisdiction lawfully, question of interfering with the injunction order in appeal does not arise. Mr. Lodh, the learned counsel for the respondent/ plaintiff, submitted that in a matter relating to passing off, actual deception is not required nor any significant injury to the defendants, but in such a situation the plaintiff is required only to establish a prima facie case. 5. Injunction is basically a relief in equity and founded on the principle of equity. The discretionary jurisdiction of granting injunction is to be exercised on consideration of the accepted norms like existence of a prima facie case, balance of convenience, irreparable loss, public interest keeping in mind the principles of justice, equity and good conscience. An order of injunction has serious ramifications and the discretion of granting injunction is not to be readily resorted to. The Court is to act with caution, circumspection and awareness on the entire fact situation. The real object behind exercise of the discretion is to preserve and protect the nature and character of the suit property till adjudication of a dispute.
The Court is to act with caution, circumspection and awareness on the entire fact situation. The real object behind exercise of the discretion is to preserve and protect the nature and character of the suit property till adjudication of a dispute. At the stage when a petition for interim injunction is filed, the Court is to act on the basis of the pleadings referred to in the plaint and the objections, if any. The picture at that stage is hazy and unsettled and the Court is really required to find out a workable formula as an interim measure during the pendency of the dispute mainly to preserve and protect the status quo. Delay defeats equity and, therefore, the Courts should guard against issuing an injunction order in cases where the plaintiff failed/fails to show any emergency in granting an order of injunction. If the plaintiff can be compensated in terms of money, question of granting inj unction will not arise. The effect of the order of injunction or the likely inconvenience of the affected party are some of these aspects which are to be gone into. In this context, the following passage from a Division Bench decision of this Court rendered in Bindeswar Narayan Singh & others vs. Managing Committee, Sree Sundarmal Hindi School & others, reported in AIR 1982 Gauhati 69, may be profitably recalled: “The circumstances under which temporary injunction may be granted have by now been more or less crystallised. Where in any suit it is proved by affidavit or otherwise that any property in dispute is in danger of being wasted, damaged, or alienated by any party to the suit, or to refrain the defendant for committing injury of any kind relating to the same property or right, the Court may grant a temporary injunction at its discretion on such terms as to the duration of the injunction, and subject to condition as the Court thinks fit. Where the defendant has committed or is threatening what the plaintiff alleges to be a trespass or a wrong, the plaintiff may ask the Court to direct the subject matter of the dispute to be maintained in status quo till the issue between the parties has been determined.
Where the defendant has committed or is threatening what the plaintiff alleges to be a trespass or a wrong, the plaintiff may ask the Court to direct the subject matter of the dispute to be maintained in status quo till the issue between the parties has been determined. Where the sole object of a suit is protection by means of an injunction, to withhold the temporary injunction may practically decide the cause in favour of defendant, without giving the plaintiff an opportunity to establish the truth of the case made by his plaint. It is true that the Court will not so interfere if it thinks that there is no real question between the parties, but assuming that there is a substantial question to be decided, it will preserve the property until such question can be regularly disposed of. Where a perpetual injunction is sued for and the plaintiff applies for a temporary injunction, the Court should grant the temporary injunction if the effect of notgranting such an injunction will be to deprive the plaintiff for ever of the right claimed by him in the suit. The Court should be satisfied that the matter is emergent and its immediate assistance is required before it will issue a temporary injunction, for there is a possibility of irreparable injury being caused to the party. If an injunction is prayed for either before or at or after the hearing of any case or matter, to prevent any threatened or apprehended waste or trespass, such an injunction may be granted if the Court shall think fit and proper. It may not be itself be a sufficient reason for the issue of a temporary injunction that the suit would be infructuous if it did not issue, but there may be causes where refusal to grant temporary injunction pending disposal of the suit would make the success at the close of the suit but a barren and worthless victory. In exercising jurisdiction by way of interlocutory injunction the Court is to act upon the principle of preventing irreparable injury.
In exercising jurisdiction by way of interlocutory injunction the Court is to act upon the principle of preventing irreparable injury. In a case where serious injury is likely to arise from the act complained of, the Court will interfere before the hearing to restrain the breach, but if the contract or covenant is obscure or the breach doubtful and no irreparable damage can arise to the plaintiff then the question resolves itself into one of comparative injury, whether the defendant will be more damnified by the injunction being granted or the plaintiff by it being withheld. Where a doubt exists as to the right specially when an injunction will cause great hardship on the defendant, an interlocutory injunction may be refused on the defendant's undertaking to keep an account in which case the plaintiff is entitled to a formal undertaking.” The law is now settled as held by the Supreme Court in Wander Ltd & another vs. Antox India Pvt Ltd, reported in 1990 (Supp) SCC 727 with respect to the areas for granting interlocutory injunction which is re-hearsed hereinbelow: “.... 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 case. 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. The present case that we are concerned with, is relating to passing off action.
The present case that we are concerned with, is relating to passing off action. The plaintiffs claim that the trade mark in utensils in question produced by the defendants is deceptively similar to the trade mark as used by the plaintiffs which is likely to cause confusion or to deceive persons/buyers. The word 'deceptively similar' and 'mark' are defined in section 2 (d) and 2 (j) of the Trade and Merchandise Marks Act. Section 28 of the Act speaks of the rights conferred by registration of trade mark and section 29 of the Act relates to infringement of the trade marks. The Act in question does not lay down any criterion for determining as to what is/are likely to deceive or cause confusion. Each case must depend on its own peculiar facts. In exercising the power of granting injunction in the matter of passing off of goods, the Court is required to take into consideration the broader aspects of the matter like the nature and condition of the market, the nature and degree of resemblance between the peculiar marks phonetic, visuals, etc, the particular character of the goods which are used or likely to be used as well as the respective marks used, the nature of the articles used by the rival traders, the average character of the buyers of the goods in question and a host of other relevant and surrounding circumstances. A Single Judge of this Court, on considering the various aspects of the law pertaining to the aforesaid Act in question as well as on different facets of the principles of the law relating to injunction pithily observed which I usefully quote hereinbelow: “In passing of action injunction (interim) should be granted where the plaintiffs trade in large and defendants trade has just commenced or is small or negligible. That is because balance of convenience tilts in favour of the plaintiff in such a case along with other requirements if in existence. An injunction should not be granted in a case under the Act of 1958 without coming to a prima facie finding, supported/ substantiated by materials that the action of the defendant is wrongful, otherwise it will amount to killing the trade/industry/business of the defendant even before the matter is finally heard and decided. That will be a death knell to the right of the defendant and shall mean condemning a person even without trial.
That will be a death knell to the right of the defendant and shall mean condemning a person even without trial. There may be some exceptional cases where the action of the defendant may be dishonest and wrongful. Otherwise in all other cases the Court must adopt a path of caution and avoid the course of grant of injunction just on mere asking.” (Super Candles & others vs. Mahabir Candle Works & others reported in (1996) 3 GLR 367) (1997 (1)GLJ 26. Cases arising out of passing off actions are apparently distinctly different from the actions brought on a complaint of infringement of trade marks which are governed by-express statutory provisions of the Trade and Merchandise a Marks Act, as will be revealed from the following excerpts from the decision of the Supreme Court in the case of Durga Dutt vs. Navaratna Pharmaceutical Laboratories, reported in AIR 1965 SC 980 (990) : “While an action for passing-off is a Common Law remedy being in substance an action for deceit, that is, a passing-off by a person of his own goods as those of another, that is not the gist of an action for infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of "the exclusive right to the use of the trade mark in relation to those goods" (vide section 21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for infringement.” 7. The aforesaid judgment which was strongly relied upon by Mr. AM Lodh, the learned counsel for the respondent as also relied upon by the learned trial Court, in fact does not help the respondent. The Supreme Court made a clear distinction in the judgment that the test to be applied in the two classes of suits are not the same and that for the success of an action for infringement of trade mark, it was sufficient to show and establish that the essential features of the d trade marks of the rivals were the same.
The Supreme Coiirt in the case of Parie Products (Private) Ltd vs. JD & Company, Mysore, reported in AIR 1972 SC 1359 indicated the distinction of an action for passing off from that brought on complaints of infringement of trade marks. In order to succeed in a passing off action, the plaintiff is not only to show and establish that there is a similarly of names or marks, but there is also a reasonable probability that the use of the name complained of by the defendant, would result in the defendant's appropriating some material advantage of the plaintiff's business. All these aspects are to be gone into during/in trial. 8. At this stage, there is only the pleadings contained in the plaint and a few documents besides the objections of the defendants/appellants which were filed at the time of the interim injunction. On its own showing, the plaintiffs became aware of the alleged passing off action in January, 1998 when some whispers were spread in the trade areas and markets. The plaintiffs took time to inquire into the matter and thereafter issued notice to the defendants through Advocate on 26th June, 1998 and then instituted the suit before the trial Court on 10th August, 1998. Therefore, on the basis of the proven facts, there was no emergency for the trial Court to exercise its discretion and to restrain the defendants from carrying on its business, which they claim to have carried on since 1990. 9. The learned Court below while exercising its discretion, overlooked the fact that the order of injunction would prohibit the defendants all together from carrying on an existing business under a trade name on the prayer of the plaintiff (s) whose claim is yet to be established. It is not like a case of infringement of trade mark, where a right is conferred on registration of the mark which itself is a property. Under the statute, an act of infringement of trade mark is per se actionable; but in a passing off action, the plaintiff has further to prove and establish that the trade name has by reputation and use come to acquire a positive meaning of distinctiveness and quality in the business carried on by the establishment.
Under the statute, an act of infringement of trade mark is per se actionable; but in a passing off action, the plaintiff has further to prove and establish that the trade name has by reputation and use come to acquire a positive meaning of distinctiveness and quality in the business carried on by the establishment. The decision of the Supreme Court in the case of NR Dongre & others vs. Whirlpool Corporation & another, reported in (1996) 5 SCC 714 is a case in pointer. Whirlpool Corporation, ie, the plaintiff No. 1, is a multinational incorporated in the USA and TVS Whirlpool Ltd, plaintiff No.2, is a limited company incorporated in India in which plaintiff No. 1 is a majority share holder. Plaintiff No.2 has been licensed by plaintiff No.l to use the trade mark and trade name 'Whirlpool'. In the suit, the plaintiffs pleaded that they have an established business in the manufacture, sale, distribution and servicing of washing machines of all kinds and plaintiff No.l was the successor of the trade mark 'Whirlpool' since 1937. By 1957, 'Whirlpool' was a leading trademark and name in the United States and Canada in relation to washing machines. By 1986, 'Whirlpool' was registered in relation to washing machines and dryers in more than sixty five jurisdictions around the world including most of the Commonwealth; countries. There was no dispute in the above suit that the plaintiffs were the prior user of the mark 'Whirlpool'. The plaintiffs alleged that in July, 1994 they , came across an advertisement of the defendants soliciting dealers for'Whrilpool' washing machines and accordingly they moved the Court by way of a suit. The matter went up the High Court and the Delhi High Court by its order dated 31.10.94, granted temporary injunction in favour of the plaintiffs on condition that the plaintiffs would within four weeks place on record an undertaking in the shape of an affidavit sworn in by their duly constituted attorney(s) or representative(s) undertaking to indemnify the defendants from any loss or damage which the defendants may incur on account of the proceedings or determined in the suit or any other duly constituted legal proceedings in the event of the plaintiffs being held not entitled to the relief sought for the suit.
The aforesaid decision was a decision on facts and the Court while injuncting, also stated sought to protect the interest of the defendants. 10. Mr. Lodh, the learned counsel for the respondent, also referred to a decision of the Bombay High Court, reported in 1991 (1) Arbitration Law Reporter 258, National Chemicals and Colour Co & others vs. Reckitt and Colman of India Ltd & others, in the course of his argument. That was a case under the Trade and Merchandise Marks Act, in fact an appeal against the decision of the Registrar of Trade Marks under the provisions of the Act. A statutory appeal was presented before the Single Judge which was set aside by the learned Single Judge of the Bombay High Court and on appeal, a Division Bench upheld the decision of the Single Judge. That case, therefore, is not applicable in the case in hand. Mr. Lodh, the learned counsel for the respondent, in support of his contention also referred to the decisions in M/s Samrat Bidi Workers & others vs. M/s Dayalal Meghji & Co reported in AIR 1999 MP 10 ; Mohan M£tkin Ltd vs. Kashmir Dreamland Distilleries & another, reported in AIR 1990 J&K 42 ; Rupa & Co vs. Dawn Mills Co reported in AIR 1998 Gujrat 247, and Wander Ltd & another vs. Antox India Pvt Ltd, reported in 1990 (Supp) SCC 727. The last decision was referred to by Mr. Lodh in support of his a contention that the appellate Court, against an discretionary order of injunction lawfully passed by the trial Court, should not readily interfere. It is no doubt an accepted principle of law that the appellate Court is not to interfere with the exercise of discretion by the Court of first instance and substitute its discretion Unless the said discretion has been shown to have been exercised arbitrarily or capriciously or perversely or where the Court had ignored the accepted principles of law regulating the grant of injunction. The appellate Court is not to re-assess the materials and seek to reach a conclusion different from the one reached by the Court of first instance on the ground that if it would have considered the matter at the first instance, it would have come to a contrary decision.
The appellate Court is not to re-assess the materials and seek to reach a conclusion different from the one reached by the Court of first instance on the ground that if it would have considered the matter at the first instance, it would have come to a contrary decision. If the decision is arrived at by the trial Court reasonably and in judicious manner, the fact that the appellate Court would have taken a different view, may not justify interference in the trial Court's exercise of discretion. There cannot be any two opinions on this issue. At the same time, the appellate Court should not fold its hands and alldw an order to continue when the order is passed by overlooking the accepted principles of law affecting the livelihood of person/persons. 11.1 have also gone through the materials referred to by the learned trial Court for reaching at his conclusion as regards the two tests referred to by the Single Judge of Allahabad High Court in M/s Victor Transport Co Pvt Ltd vs. The District Judge, Ghaziabad, on a petition under Article 226 of the Constitution of India. I have also perused the documents referred to by the learned trial Court. The learned Judge reached the above finding, as if he was passing an order after conclusion of the trial on assessing the evidence on record. The. rival contentions of the parties are yet to be adjudicated in trial - for that reason, I refrain, from making any further comment there,on. I, however find that the learned trial Court was not justified in passing the impugned orders, of injunction. 12. In the instant case, the learned trial Court while exercising the discretion, not only ignored the accepted principles in the matter of injunction, but also fell into error by overlooking the mandates of the law. The order of injunction was passed without even maldng any endeavour to protect the interest of the defendants. 13. For the foregoing reasons, the impugned orders of injunction dated 26.8.98 and 19.9.98, passed by the learned District Judge, West Tripura, Agartala in Misc Case No. 212 of 1998 are set aside, and the learned trial Court is directed to proceed with the trial of the main suit in an expeditious manner. 14.
13. For the foregoing reasons, the impugned orders of injunction dated 26.8.98 and 19.9.98, passed by the learned District Judge, West Tripura, Agartala in Misc Case No. 212 of 1998 are set aside, and the learned trial Court is directed to proceed with the trial of the main suit in an expeditious manner. 14. The defendants are directed to file their written statements within four weeks from today before the trial Court and thereafter the learned trial Court shall proceed with the trial in accordance with law and take all possible care to dispose of the suit as early as possible, preferably within six months from the date of receipt of the records. 15. The appeal is allowed and the respondent shall bear the cost of this proceedings.