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2008 DIGILAW 216 (DEL)

Goramal Hari Ram Limited v. Durgashri Agencies

2008-02-22

S.RAVINDRA BHAT

body2008
JUDGMENT : S. Ravindra Bhat, J. This order will dispose off I.A. No. 4222/06 in CS (OS) No. 25/2006, under Order 39, Rule 4 of the Code of Civil Procedure, 1908, for the vacation of the order of ex parte ad-interim injunction granted on 9th January 2006 in I.A. No. 261/2006. 2. The facts relevant for the present purpose are as follows. That plaintiff company is a limited company registered under the Companies Act, 1956. It is successor to the partnership firm M/s. Gora Mal Hari Ram. The plaintiff is also the subsequent proprietor of the registered trademark 555', registered by No. 11989 in Class 3, in respect of soaps and detergents for laundry use. It is averred that the said trademark has been continually renewed from time to time and is currently valid and subsisting in the Trademarks Register. It is also averred that the soaps and detergents marketed under the trademark 555' has a unique get-up and layout in the wrapper/packaging. The plaintiff avers that the said get-up and layout of the wrapper/ packaging is an original artistic work within the meaning of Section 2(c) of the Copyright Act, 1957 bearing No. A-30940/1980. 3. It is averred that the plaintiff has been the actual and uninterrupted user of the trademark since 1924. By relying on the turnover, the plaintiff submits that the trademark is a very popular one and enjoys an enviable goodwill and reputation in the market. It is also averred that plaintiff has incurred significant expenditure for advertisement and promotion of the said trademark in newspapers, television, hoardings, slides, radio etc. It is alleged that the Trade Mark "555" has acquired distinctiveness and has become identifiable exclusively with the plaintiff's products. Further, that said trademark is well-known and is considered so by the purchasing public and is a household name when it comes to detergent/soap for washing purposes. 4. The first defendant was a dealer of the plaintiff and dealing with in the goods manufactured and sold by the plaintiff under the said trademark. It is averred that the plaintiff came to know during the second week of November, 2005, through a letter received from the sole distributor, that the first defendant had started manufacturing and marketing his own soap under the trademark 555'. The defendant also started using the slogan "Asli 555 Ab Hare Pack Main" and "Swedeshi Sabun Naye Pack Main". It is averred that the plaintiff came to know during the second week of November, 2005, through a letter received from the sole distributor, that the first defendant had started manufacturing and marketing his own soap under the trademark 555'. The defendant also started using the slogan "Asli 555 Ab Hare Pack Main" and "Swedeshi Sabun Naye Pack Main". It is also alleged that the Defendants are approaching the same customers and offering the goods under the same Trade Mark 555. It is submitted that the first defendant manufactures the allegedly infringing goods through the third defendant and the same are marketed through the second defendant, who is a sister concern of the first. The name of the third defendant is printed on the outer carton of the infringing product. 5. The plaintiff submits that the defendants' mark 555' is phonetically, structurally and visually similar to the plaintiffs' trademark 555'. It is alleged that the adoption and use by the defendants of a trade mark confusingly similar and identical with to the trademark 555 of the plaintiff, in respect of similar goods for which the mark is extensively used by the plaintiff amounts to infringement and also passing off. The use by the defendants of the slogans "Asli 555 ab Hare Pack Main" and "Swadeshi Sabun Naye Pack Main", allegedly causes great harm to the plaintiff's business interests. It is further submitted that by virtue of prior adoption, registration and prior use, the trade mark 555, its distinctive packaging and the unique combination of arrangement of features, get-up and layout, has earned substantial goodwill and reputation. Further, the members of the trade and public associate the trademark 555 is indicia of the plaintiff and no one else. 6. It is submitted, therefore, that the use of the mark 555' by the Defendants is likely to cause confusion and deceive the public along with the members of the trade. By using the trademark 555', the plaintiff claims that the defendants are giving the impression to the public at large that they are associated with the plaintiff or the goods sold under the trademark 555 by them are the goods of the plaintiff. It submits that the malafide intention of the Defendants is ex-facie clear they are using an identical mark 555 in relation to identical goods. It submits that the malafide intention of the Defendants is ex-facie clear they are using an identical mark 555 in relation to identical goods. Further, that the Defendants have attempted to make a deliberate by misrepresent to the purchasing public and the trade that their goods are those of the plaintiffs. This misrepresentation, it is contended, is bound to cause confusion and deception in the minds of the purchasing public, who are confronted with a product similar to that of the plaintiff which are manufactured, marketed and sold by the defendants. 7. The plaintiff allege that the defendants are not following strict quality controls for production of washing soaps and detergents cakes, and are manufacturing substandard goods under the trademark 555. The consumers are purchasing the said goods with belief that they are purchasing the quality products of the plaintiff, hence the defendants are causing the loss and injury to their goodwill and reputation pertaining to trademark 555. Lastly it is submitted that the Defendants, by selling infringing products under the said mark have caused, and are causing immense loss, both monetary, and to the reputation of the plaintiff. The loss to the plaintiff's reputation and goodwill is however unquantifiable. Therefore, the plaintiff seek that ad-interim injunction granted at the time of institution of the suit, should be continued. 8. By order dated 9th January 2006, the plaint was registered and the Court granted an exparte ad-interim injunction in favour of the plaintiff restraining the defendants from manufacturing, selling and offering for sale of detergent soaps, washing soaps and other allied and cognate products under the trade mark 555'. Pursuant to that, the Defendants filed their reply to the application for temporary injunction and also moved an application under Order 39, Rule 4 CPC for vacation of the ex-parte temporary injunction. 9. The defendants position-in their reply to the plaintiff application, as well as their application for vacation of interim injunction is that the plaintiff has not approached this Court with clean hands. They aver that plaintiff has suppressed material facts and has successfully misled the court in obtaining the injunction order. They allege that the plaintiff is guilty of misrepresentation. They submit that the plaintiff has deliberately not mentioned that the trade mark 555' was used by its original registered owner Mr. They aver that plaintiff has suppressed material facts and has successfully misled the court in obtaining the injunction order. They allege that the plaintiff is guilty of misrepresentation. They submit that the plaintiff has deliberately not mentioned that the trade mark 555' was used by its original registered owner Mr. Zakir Ali since 1967 and was later assigned to the second defendant through, an assignment deed dated 27th June 2005. They rely on the certificate issued by the Trademark Registry, Bombay on 1st November 1969, which mentions that the rights concerning the trade mark 555' were granted to one Mr. Zakir Ali, trading in the name of Rajasthan Soap Factory, Tijori Gali, Siyaganj, Indore, Madhya Pradesh for selling his products in Rajasthan and Madhya Pradesh. The allegation of infringement of the trademark is devoid of any merit, since the plaintiff entered in the Madhya Pradesh market in the year 1989 i.e. 22 years after commencement of business by Mr. Zakir Ali. Therefore, it is submitted that the plaintiff cannot claim to be a prior user. 10. Relying on the plaint, the defendant's submit that the plaintiff has admitted being a subsequent user, as is the case with themselves. They their use of the mark permissible u/s 12 of the Trade Marks Act, 1999 (hereafter referred to as "the Act"), whereby honest and concurrent users are permitted can hold valid registrations in respect of identical or similar trademarks, subject to conditions and limitations imposed by the Registrar. They submit that at least ten registered users for the said trademark, exist and in this regard rely on the Search Report issued by the Registrar of Trademarks. They aver that Mr. Zakir Ali assigned the said Trade Mark to the second defendant, after the due satisfaction of the Registrar. 11. The defendants also relied on Sections 28 and 30 of the Act to demonstrate that two simultaneous users having registrations in relation to identical or similar trademarks cannot claim exclusive rights. Further, they aver that u/s 31 they enjoy a prima facie presumption of validity. 11. The defendants also relied on Sections 28 and 30 of the Act to demonstrate that two simultaneous users having registrations in relation to identical or similar trademarks cannot claim exclusive rights. Further, they aver that u/s 31 they enjoy a prima facie presumption of validity. They rely on the decisions in PM Diesels Pvt. Ltd. v. Thukral Mechanical Works AIR 1998 Del 282 and TTK Prestige Ltd. v. Har Prasad Gupta 1999 PTC 72 (Del) to bring home the point that in cases of two registered users by way of subsequent assignment, a suit for infringement is not maintainable and both parties have a right to use the trademark. Further defendant's counsel also relied on Jindal Industries v. Nirmal Steel Tubes AIR 1994 Del 42 to submit that a registered user cannot be injuncted. They also argue that since the mark is descriptive and not distinctive, the plaintiffs cannot claim exclusive use of the said mark. 12. Relying upon the principle that delay defeats equity, they submit that since the plaintiff did not proceeded against Mr. Zakir Ali, in whose name the registration of the mark exists since 1969, no action for passing off is maintainable. They cite the decision in Creative Travels v. Creative Tours and Travels 2006 (33) PTC 430 (Del) in this regard. Further, they point out to the fact that the plaintiff ad not enforced his rights against the others who held registration for the same mark. 13. The plaintiff has in an affidavit placed on record contested the veracity and legality of the assignment deed relied upon by the defendant. It also submits that the said alleged assignor had never marketed the product in Rajasthan and Madhya Pradesh, and that one of the witnesses to the said assignment deed was its dealer. 14. It is evident from the above narration that the present case in the strict sense, is not an action for infringement. The question therefore is whether the plaintiff has established sufficient cause, at this stage to seek injunction on the allegations of passing off, or whether the defendants are an honest concurrent user, as alleged by them. 15. Section 28(3) of the Trade and Merchandise Marks Act 1999 enacts that where two or more persons are registered proprietors of trade marks, which are identical or resemble each other, the exclusive rights to such marks cannot be asserted against each other. 15. Section 28(3) of the Trade and Merchandise Marks Act 1999 enacts that where two or more persons are registered proprietors of trade marks, which are identical or resemble each other, the exclusive rights to such marks cannot be asserted against each other. Section 28 is subject to other provisions of the Act; Section 27(1) prescribes the right of one registered trademark proprietor to sue another for passing off. This position was noticed in N.R. Dougre v. Whirlpool Corp. 1996 PTC (16) 583. An application of the ruling here would mean that the plaintiff's action for passing off. survives. 16. A careful analysis of the pleadings shows that the defendants do not dispute two vital facts, i.e. that the plaintiff has been using the mark, and its registration in 1989, and that the first defendant was the plaintiff's dealer till 2005. The defendant has sought to set up a parallel case that the mark was actively advertised and marketed since 1967. Barring a few sales tax documents for 2001, there is absolutely no material to back this assertion. 17. The decisions relied on by the defendants seem in opposite. P.M. Diesels case (Supra) does not advert to the right preserved in Section 27. Likewise, T.T.K. Prestige was a case of honest concurrent use of a different class of goods. Jindal Industries too did not analyse or consider the interplay between Sections 27 and 28. In the circumstances, the declaration of law in Dongre's case is most appropriate; it is also by the Supreme Court. The suit is a composite one for infringement and passing off. 18. On the materials placed on the record, as well as pleadings and contentions of the parties, the plaintiff has been successful in establishing that the ad-interim order subsisting till date should be confirmed. The defendant's application, for the same reasons, is unmerited. Accordingly it is directed that order dated 9.1.2006 shall subsist and bind the parties during the pendency of the Suit. I.A. No. 261/2006 is allowed in the above terms. I.A. No. 4222/2006 is accordingly dismissed.