JUDGMENT P.D. Rajan, J. 1. The appellants who are the plaintiffs in O.S. No.7 of 2016 of the District Judge, Manjeri filed the above suit for permanent injunction restraining the defendants from using the brand name 'UTC' in their rice business which is similar to that of the plaintiffs. There was also prayer for interim injunction (I.A. No.1563 of 2016) restraining the defendant respondents from selling, marketing, stocking or distributing rice using the brand name 'UTC' or 'United Trading Company' in their business which was refused by the learned trial Judge, feeling aggrieved by that order plaintiffs preferred this appeal. 2. According to the plaintiffs, the first plaintiff is a partnership firm namely 'United Trading Company' engaged in packing and selling of rice under the brand name 'UTC' since 1987 and the plaintiffs 2 to 5 are the partners of first plaintiff. The plaintiffs have acquired reputation and goodwill for conducting the business of rice in the above brand name. The firm was founded by one Aisha Beevi, the mother of plaintiffs 2 to 5, under the care of her husband P.Abu Haji who was running various business concerns under the trade name Thayyil Traders. The plaintiffs in this case were conducting the business without any interruption and they rendered a quality service which acquired a good reputation, public confidence and goodwill for their business for several years. Respondents 1 and 2 are the business enterprises based at Nagpur, marketing rice to Kerala. The third defendant is a retired partner from the plaintiff's firm who accepted all retirement benefits from the firm and relinquished all his rights. Now, he, with the association of other defendants violated the legitimate right in the trade mark and used the trade name 'UTC' by fraudulent means. Since, the plaintiffs are the prior adopters of the trade name UTC, the defendants have no legal right to adopt and use an identical name for an identical business, their act is prima facie fraudulent, dishonest and used with intend to take advantage of the goodwill and reputation of the plaintiffs firm. 3. In the lower court, the respondents 1, 2 and 4 have filed cross objection and contended that the brand name UTC and the trade name United Trading Company are not owned by the petitioners since the trade name 'United Trading Company' is a common business name.
3. In the lower court, the respondents 1, 2 and 4 have filed cross objection and contended that the brand name UTC and the trade name United Trading Company are not owned by the petitioners since the trade name 'United Trading Company' is a common business name. Since several business entities and firms in India are using the said name for the trade activities, it is a 'Communis Juris Firms', therefore, the petitioners alone cannot claim trademark right over such names and derivatives and it cannot be protected under the law of trademark or passing off. The first defendant is a trader of rice at Nagpur and Maharashtra under the proprietary concern of Mr.Piyush Manoharlal Sachani who purchase rice with trademark UTC from Manoharlal Jeevandas Sachani. This Manoharlal Jeevandas Sachani is a miller using the trademark for processing rice at his mill since 1979 and he is distributing rice in Maharashtra in the trade name. He is conducting rice business in the name and style Bharti Industries, Nagpur since 1993 which is a partnership firm. Therefore, the logo of UTC is created by Manoharlal Jeevandas Sachani since 2005 and the firm is manufacturing, processing and distributing rice under the above brand name. Since they are not made parties in this case, the suit is bad for non-jointer of necessary parties. Hence, the petitioners have not prima facie proved any passing off and the application ought to have been dismissed forthwith. 4. The 3rd respondent, in his objection, contended that the plaintiff's firm was not registered before the Registrar of Firms as claimed in the application and the above brand name was not used by the appellants from 1987 onwards. A person namely Abu Haji applied for registration of trade mark on 14.02.2014 for getting registration of trade mark for 'Biriyani Rice'. Therefore the petitioners approached the court with unclean hands and raised all contentions advanced by the other respondents and prays to dismiss the petition. 5. Substantial documents were filed before court in support of the contention by both parties which were marked as Exts.A1 to A85 and Exts.B1 to B23. After hearing both sides, the learned District Judge observed that the petitioners failed to make out a prima facie case and the brand name 'United Trading Company' is a common name and several business concerns are engaged in using the same for their trade.
After hearing both sides, the learned District Judge observed that the petitioners failed to make out a prima facie case and the brand name 'United Trading Company' is a common name and several business concerns are engaged in using the same for their trade. Moreover, it was observed that, in a descriptive name, about which no one can claim any exclusive right hence the learned District Judge dismissed the application. 6. Since the suit is pending before the District Court, it is better to examine the main element for granting interim injunction against the action of passing off. 'Prima facie' case and balance of convenience have to be analysed in the light of reputation of good will, possibility of deception and likelihood of damages to the plaintiffs. The ground reality in the trade or business is that a competition in the sale of goods or service in the same name or imitating that name by another person causes injury to the business of one who owns that name. In trade and business, it is common for a trader or a business man to adopt a trade name for his firm or brand name or mark to his product under which he would carry on his business. The name under which a trade or business exist will always be in that trade name or if the business ensure a service, it has a service mark. The questions of independent use of trade name or trade mark or service mark, however, normally attach to its good will and the name of a business is attached to its goodwill and the court has to protect that goodwill. An action for passing-off will then lie against a person whenever defendant who is another business man use that trade name, or its intended mark, in order to confuse and to divert business from the plaintiff, or to make a confusion in the two businesses. Where there is probability of making confusion in the business by using the trade name or brand name or mark, an injunction will be granted even though the defendants have adopted the name innocently. In this case, appellants submitted that respondents are making false representation of the brand name. 7.
Where there is probability of making confusion in the business by using the trade name or brand name or mark, an injunction will be granted even though the defendants have adopted the name innocently. In this case, appellants submitted that respondents are making false representation of the brand name. 7. Apex Court in Laxmikant V. Pattel v. Chetanbhat Shah & Anr., 2002 (24) PTC 1 SC held as follows: A person may sell his goods or deliver his services such as in case of a profession under a trading name or style. With the lapse of time such business or services associated with a person acquire a reputation or goodwill which becomes a property which is protected by courts. A competitor initiating sale of goods or services in the same name or by imitating that name results in injury to the business of one who has the property in that name. The law does not permit any one to carry on his business in such a way as would persuade the customers or clients in believing that the goods or services belonging to someone else are his or are associated therewith. It does not matter whether the latter person does so fraudulently or otherwise. The reasons are two. Firstly, honesty and fair play are, and ought to be, the basic policies in the world of business. Secondly, when a person adopts or intends to adopt a name in connection with his business or services which already belongs to someone else it results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury. 8. Learned counsel appearing for the appellants contended that the appellants are wholesale and retail merchants of rice since 1987 under the trade name 'United Trade Company' and its abbreviation 'UTC' as a brand name for marketing their products which is running at Puthanathani even today. After termination of the 3rd respondent from the partnership firm on 29.02.1996, he cannot conduct marketing of rice under the trade name 'United Trading Company' and its abbreviation 'UTC' without obtaining permission of the appellants. The 3rd respondent opened a shop with the help of the 1st respondent who is also operating business in the name and style of 'United Trading Company' at Nagpur, which is a newly formed firm.
The 3rd respondent opened a shop with the help of the 1st respondent who is also operating business in the name and style of 'United Trading Company' at Nagpur, which is a newly formed firm. The drivers who are transporting rice from Nagpur to Puthanathani confused the public by imitating the same name. Appellants have made out a prima facie case and the balance of convenience is in their favour. 9. In an action for 'passing off' it is essential to seek temporary injunction or an ad-interim injunction. The principles for the grant of such injunction are the same and the plaintiffs must prove a prima facie case, availability of balance of convenience in their favour and an irreparable injury will be caused in the absence of grant of injunction. Apex Court in Heinz Italia v. Dabur India Ltd., 2007 KHC 3635: 2007 (6) SCC 1 held that in an action for passing off, the plaintiff has to establish prior user to secure relief. There are five elements to be proved. They are i) misrepresentation, ii) made by a trader in the course of a trade, iii) prospective customers of his or ultimate consumers of goods or services supplied by him, iv) which is calculated to injure the business or goodwill of another trader (in the sense that this is a reasonably foreseeable consequence) and v) which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so. 10. An action for infringement of a trade mark and passing off have a common origin. But passing off action is common law remedy, while infringement of trade mark is a statutory remedy. In passing off action, the plaintiff should prove that the defendants' activities must involve a false representation causing damage to goodwill acquired by the plaintiff. The point that arises in such matters for consideration is that the use of the trade name or mark by the defendants in respect of their goods leads to a belief among the public that such goods would be the goods of the plaintiffs and usually calculated to deceive the public. It is essential for the success of any claim in respect of passing off to prove that the mark used by the defendants is possibly similar to the one which belong to the plaintiff.
It is essential for the success of any claim in respect of passing off to prove that the mark used by the defendants is possibly similar to the one which belong to the plaintiff. The essential ingredients in case of passing off is the extent of reputation established by the plaintiff with reference to his trade mark or trade name. This court in Mahavir Rice & Pulse Mills, Bareja v. Jaikrishnan Trading Company, Miroli and Others, 2009 (4) KHC 187 held that: In the decision reported in Laxmikant V. Patel v. Chetanbai Shah, 2002 (Vol.110) Company Cases 518 it was held that the three elements of passing off action are the reputation of goods, the possibility of deception and the likelihood of damage to the plaintiff. It is also held that the same principle which apply to trade marks apply to trade names also. 11. The main contention of respondent nos.1, 2 and 4 in this case is that they are purchasing rice from various companies who manufacture, process and pack various brands of rice including UTC and sell it to the distributors at various places in India including Nagpur, Kochi, Kozhikode and Malappuram. The 1st respondent's father coined the trademark 'UTC' who is the owner of the same trade name since 1979 to 2005. The trade was continuing with a partnership firm M/s. Bharti Industries and the appellants cannot claim any monopoly over the said common generic name 'United Trading Company'. It is an admitted fact that the specific use of the brand name and the user of the period of the brand name is an important principle in the theory of 'passing off'. But the respondents contended that the right of use of the ownership of the brand name 'United Trading Company' and its abbreviation 'UTC' is vested with M/s Bharti Industries, Nagpur and the 1st respondent miller alone has the right under the Trade Mark Act. 12. In the present case, the appellants claim to have been running a business in the name and style 'United Trading Company', which was started in the year 1987 as a partnership firm, in which the 3rd respondent was the Managing Partner in the year 1993. Ext.A86 is the PAN card of the United Trading Company, but the partnership deed was not produced along with the PAN Card.
Ext.A86 is the PAN card of the United Trading Company, but the partnership deed was not produced along with the PAN Card. The learned counsel for the appellants submitted that the partnership deed was misplaced and could not be traceable. Ext.A87 is another partnership deed prepared on 2.4.1996, in which one Aboobacker, Aiysha Beevi and Niyas are the 1st, 2nd and 3rd partners and also mentioned that T. Kunjathumma retired on 31.3.1996 and reconstituted the partnership on 2.4.1996. In Ext.A87, it is mentioned that they reconstituted the partnership deed on 23.3.1993 and Sri. Aboobacker was included as Managing Partner in that year, in which it is stated that on 29.12.1987, one Aysha Beevi had constituted a partnership firm with Kunjathumma under the name and style of 'United Trading Company' at Puthanathani, Kalpakancherry Panchayat in Malappuram District. The 3rd respondent was the Managing Partner of United Trading Company from 23.3.1993 onwards and he retired from the firm on 03.3.2016. From the above deed, it is clear that the new partners may be admitted subject to the common consent of all other partners. As per the deed, retired partner or his heirs or the legal representatives of deceased partner shall be entitled to his capital as increased or decreased by the accumulated share of profit or loss and as adjusted by his drawings. The same so calculated shall be paid within a period of 12 months from the date on which the retirement or death occurs. Therefore, it is clear that on the death of any one of the partners, surviving partners shall admit legal heir of the partner or the legal representative of the deceased partner subject to the terms and conditions of the partnership deed. 13. The evidence in Exts.A1 to A3 shows that the firm Mukesh Trading Company had business dealings with United Trading Company from the year 1996 onwards. Exts.A4 to A55 bills show the business dealings with Mukesh Trading Company. Ext.A34 shows that the appellant had registered with Government of Kerala under the VAT Act in the name of the United Trading Company. Exts.A55 to A76 are the bills and invoices issued to various companies. Ext.A4 is the credit bill issued to United Trading Company. The first respondent is conducting trade of rice at Nagpur and purchasing rice from the firm UTC, which is the trade name of one Manoharlal Jeevan Das Sachani.
Exts.A55 to A76 are the bills and invoices issued to various companies. Ext.A4 is the credit bill issued to United Trading Company. The first respondent is conducting trade of rice at Nagpur and purchasing rice from the firm UTC, which is the trade name of one Manoharlal Jeevan Das Sachani. Ext.B1 is a computer generated document. As per Ext.B1, tin details are furnished from 2006 onwards. Ext.B22 shows that the application is pending before Registrar of Trade Mark Mumbai for registering their trade name, the user details of which shows the date as 15.4.2005. R1, R2 and R4 produced documents as per I.A. No.3641 of 2017. I have perused those documents but the usage of UTC is not mentioned in those records. Carbon copy of one handwritten document in Marathi language is produced. In the additional documents, an invoice dated 05.02.2005 of M/s Bharti Industries is produced in which the brand name 'UTC' is mentioned. In the year 2011 (on 10.07.2011) M/s Bharti Industries conducted sale of rice in the name 'UTC'. The Certificate of Registration dated 01.04.2006 shows that M/s Bharti industries was registered as a partnership firm and the nature of business is mentioned as Manufacturer and Wholesale Dealer alone. The brand name is not mentioned but in the subsequent invoice, the name UTC is mentioned therein. 14. In a suit for passing off, the factum of pending application for registration or not applying for registration before the Registrar of Trademark is irrelevant. It is unnecessary for the plaintiffs to say that they had applied for registration. The fact that the plaintiffs had not applied for registration will not improve their case against the defendants. In short, the contention that an application for registration of a trade mark pending before the Registrar does not constitute a part of cause of action where the suit is preferred on the ground of "passing off". Therefore, the contention that the appellants applied for registration of brand name UTC in the name of Abu Haji, Thayyil Traders and the 1st respondent's father filed another application before the Registrar of Trade Mark is irrelevant to regularise the brand name UTC on the ground of passing off. 15. The records show that the appellants are conducting business and using the brand name 'UTC' from 1987 onwards. The first respondent claimed that he is conducting business by using the trade name 'UTC' from 1979 onwards.
15. The records show that the appellants are conducting business and using the brand name 'UTC' from 1987 onwards. The first respondent claimed that he is conducting business by using the trade name 'UTC' from 1979 onwards. In this situation, it is difficult to draw a line between these two parties in the absence of specific evidence. An injunction for passing off against the first respondent could be allowed, only when the appellants prove that they got reputation for a pretty long time by using the brand name as a right for several years. In the absence of such evidence, mere raising of contention by the appellants itself is not a ground to grant injunction against the 1st respondent. The 3rd respondent raised a contention that Section 36 of the Partnership Act permits him to hold the firm name 'UTC' in his new business, however in the absence of any contract, that contention itself is unsustainable. The 2nd respondent submitted that he is not doing any business by using the trade name 'UTC' and no direction is given against him. The right of the appellants and the respondents in the trade name 'UTC' shall be decided by the trial Court on evidence. Hence, the injunction against R1 is rejected. However, the 3rd respondent is restrained by a temporary injunction from using the trade name 'UTC' in his business during the pendency of the suit. The 3rd respondent is directed to make necessary changes in his trade name within one month from the date of receipt of a copy of this judgment. 16. In view of the above discussion, the District Judge, Manjeri is directed to expedite the trial and dispose of the matter as per law within a period of six months from the date of receipt of a copy of this judgment. This appeal is disposed of as above.