Gujarat High Court
Nirav Nimmi Corporation vs Ashish Traders on 7 March, 2025
NEUTRAL CITATION
C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025
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Reserved On : 12/02/2025
Pronounced On : 07/03/2025
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 9 of 2025
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2025
In R/APPEAL FROM ORDER NO. 9 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE MAULIK J.SHELAT Sd/-
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Approved for Reporting Yes No
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NIRAV NIMMI CORPORATION
Versus
ASHISH TRADERS
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Appearance:
MR KALPESH C PATEL(5066) for the Appellant(s) No. 1
MR KIRTAN K PATEL(13023) for the Appellant(s) No. 1
MR TEJAS S TRIVEDI(5692) for the Appellant(s) No. 1
MS. NISHTHA A TRIVEDI(16306) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT
CAV JUDGMENT
1. The present appeal is filed under Order 43 Rule (1) (r) of
the Code of Civil Procedure, 1908 (hereinafter referred to as
“the CPC“), against the judgment and order dated 30th
December, 2024 passed by the 4th Additional District Judge,
Mehsana at Visnagar in Trademark Suit No. 1 of 2024.
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2. The short facts of the case are as under:
2.1 The appellant herein is the original plaintiff, and the
respondent is the original defendant (hereinafter the parties
will be referred to as per their original position in the suit).
2.2 The plaintiff is the proprietary firm and Piyushbhai
Pukhraj Shah is its proprietor. The plaintiff is in the business
of various spices, more particularly, cumin. The plaintiff firm
using the mark “ARJUN” on its packing pouches since its
inception i.e. 1988. The brand name – mark “ARJUN” gained
popularity amongst trader/consumer etc. thereby, accepting and
identifying it as mark of plaintiff.
2.3 It is further the case of the plaintiff that a firm,
namely, Shah Maganlal Vajingji (hereinafter referred to as
SMV), was using the mark “ARJUN”. The father of the
proprietor of the plaintiff, namely, Pukhrajbhai Shah, was
running SMV firm, and Piyushbhai was used to do business
with his father in SMV thereby, using the mark “ARJUN”
while selling spices. It is a case of plaintiff that on his demise,
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SMV firm was converted into a partnership firm in the year,
1983, thereby the proprietor of the plaintiff, his brother –
Subhashbhai, and his mother – Deviben became partners of
SMV.
2.4 As per Clause 18 of the said partnership firm, in a
case, any of the partners retired or the firm was closed then,
on happening of such an event, no goodwill of the firm would
be considered.
2.5 The proprietor of the plaintiff, namely, Piyushbhai and
his mother – Deviben retired from the said partnership firm in
the year, 1994.
2.6 Deviben also gave a declaration dated 23 rd November,
1994, thereby declaring that on the demise of her husband on
19th August, 1983, she and her two sons decided to convert the
SMV – firm into a partnership firm and to run the business of
spices under the brand name of “ARJUN.” She further declared
that the firm had business between the years 1983 to 1994,
and she was looking after the affairs of the firm. She further
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declared that she and her elder son, namely Subhashbhai, used
to help the proprietor of the plaintiff in his independent
business. She further declared that due to old age and the
plaintiff’s firm already doing his business since 1988, there was
no need to continue the SMV partnership firm, which may be
converted into a proprietary firm in favour of her elder son,
namely, Subhashbhai. She has forgone all her rights, property,
and assets in favour of the proprietary firm of her son –
Subhashbhai.
2.7 In the very declaration, it has been clearly stated by
her that a separate document dated 1 st April, 1994 has been
executed for the dissolution of the partnership firm – SMV.
2.8 The plaintiff applied for the registration of the
trademark “ARJUN” on 10th August, 1993. The trademark
certificate was issued in favour of the plaintiff on 14 th June,
2000. Nonetheless, plaintiff was/is using the mark “ARJUN” on
his packaging pouches while selling cumin and other spices in
the open market since its inception.
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2.9 The plaintiff has also produced an extract from the
Register of Copyright Act, 1957 (hereinafter referred to as the
Act,1957), issued on 18th May 2006, whereby the plaintiff
contended that he is holding the copyright, “Title of the work
– ARJUN SPICES N.N.CORP. WITH DEVICE OF SPICES &
ARJUN.”
2.10 The certificate shows the name of the real owner as
the plaintiff, and the work was first published in the year
1978.
2.11 Thus, in short, it is the case of the plaintiff that a
trademark certificate in the name of “ARJUN” and also a
copyright certificate for artistic work, which was printed on
pouches, are also in favour of the plaintiff, having received the
copyright certificate for such work thereby, it is registered
proprietor of trade mark “ARJUN”.
2.12 The brother of the plaintiff, namely, Subhashbhai,
appears to have raised an objection about the granting of the
trademark “ARJUN” in favour of the plaintiff by filing an
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application in the year, 2022, which is pending before the
appropriate adjudicating authority under the Trademark Act,
1999 (hereinafter referred to as the Act,1999).
2.13 It is the case of the plaintiff that the brother of the
plaintiff had stopped doing business since 2004/2013, having
surrendered his license under the Shop and Establishment Act,
Sales Tax as well as APMC etc. It is further the case of the
plaintiff that his brother – Subhashbhai was, in fact, employed
in the plaintiff’s firm and drew a salary.
2.14 The defendant was a distributor and dealer of the
plaintiff, thereby permitted to sell the product of the plaintiff
in the packaging pouches of the plaintiff under the brand name
and style of “ARJUN.”
2.15 Later on, it came to the notice of the plaintiff that the
defendant had started engaging in unethical business practices,
which severely damaged the plaintiff’s reputation and goodwill
associated with the ARJUN Marks. The defendant had not
stopped such activity despite requested by plaintiff. It came to
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plaintiff’s notice that erstwhile owner of defendant namely
Sureshbhai Shah had introduced the impugned goods into the
market under the impugned Mark, whereby, involved in the
unauthorized sale of goods (spices) under the Mark “ARJUN”
albeit, branding it “Marketed” in defendant’s name on its
selling pouch.
2.16 The plaintiff had initially issued public notices against
counterfeit products under the “ARJUN” mark in October,
2023. Later on, in May, 2024, it came to know that the
defendant again resumed infringing activities, thereafter
obtaining necessary confirmation against the unauthorized use
of the “ARJUN” mark by the defendant, resulted in the filing
of a trademark suit against the defendant.
2.17 The Trial Court appears to have granted an ex-parte
ad-interim injunction in favour of the plaintiff on 28-10-2024,
which is continued till passing of the impugned order and
thereafter extended till date.
2.18 The defendant appeared and filed its written statement
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through its power of attorney, namely, Shah Subhashbhai
Pukhrajbhai, who happens to be the elder brother of the
proprietor of the plaintiff’s firm and proprietor of SMV.
2.19 It is the case of the defendant that the plaintiff was
neither a prior user nor a registered proprietor of the Mark
“ARJUN,” as the mark “ARJUN” was owned by the SMV firm.
2.20 The defendant further contended that the mark, which
was registered by the plaintiff in its name is already opposed
by the proprietor of the SMV – firm, namely, Subhashbhai, the
power of attorney holder of the defendant, before the
competent authority, which is pending. So, the present suit
and injunction proceedings cannot be proceeded further in light
of Section 124 of the Act,1999.
2.21 The defendant has opposed the suit further on the
ground that Piyushbhai – the proprietor of the SMV – firm, has
permitted both the plaintiff and the defendant to use the mark
“ARJUN,” and as the SMV – firm is a prior user of the mark
“ARJUN,” the plaintiff cannot be permitted to use the mark
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“ARJUN.”
2.22 It is further the case of the defendant that once the
plaintiff and his mother retired from the SMV – firm, the
plaintiff cannot be permitted to own the mark “ARJUN,” and
no exclusivity of such mark can be granted in favour of the
plaintiff.
2.23 The jurisdiction of the Trial Court is also questioned
by the defendant. The defendant is using the mark “ARJUN” as
per the consent of its real owner – Shah Subhashbhai, and has
been using it since long, and therefore, no injunction can be
granted in favour of the plaintiff.
2.24 After hearing the parties at length, the Trial Court
rejected the injunction application in its impugned judgment
and order dated 30th December, 2024, holding that no prima
facie case has been made out by the plaintiff, and thereby no
injunction can be granted in favour of the plaintiff.
Consequently allowed an application of defendant filed below
Ex.11 thereby, allowed defendant to sell its goods seized by
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the trial Court’s order.
3. SUBMISSION OF THE APPELLANT – PLAINTIFF
3.1 Learned Senior Counsel Mr.Harshit Tolia would submit
that the Trial Court has completely lost sight of the different
provisions of Act, 1999 and Act, 1957 and did not appreciate
Sections 28, 29, 31 and 34 of the Act, 1999 and Sections 14,
3.2 Learned Senior Counsel Mr.Harshit Tolia would submit
that section 34 “Protects the rights of the registered proprietor
when the opposing party has not demonstrated continuous use
of the trademark”. He would submit that the Trial Court itself
admitted that Subashbhai’s use of the “ARJUN” mark ceased
in 2013. Factually, Subahbhai Shah discontinued his business
operations in 2004 and surrendered his Sales Tax Registration
Certificate under (SMV) due to the closure of the business. This
discontinuation disqualifies Subashbhai from claiming any prior
user rights, thereby nullifying any defence based on prior use.
3.3 Learned Senior Counsel Mr. Harshit Tolia would
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submit that the Defendant does not qualify as a permitted user
of Subashbhai’s trademark under Section 2(1)(r) of the Trade
Marks Act. As per this provision, a permitted user refers to a
person who has been duly authorized, through a written
agreement, by the registered proprietor of the trademark to use
the mark in relation to specific goods or services. Furthermore,
Section 49(1)(a) of the Trade Marks Act clearly states that any
license or permitted use of a trademark must be in writing,
However, no such written agreement or authorization exists
between Subashbhai and the Defendant in the present case.
Therefore, the Defendant’s use of the trademark is
unauthorized and does not fall within the legal definition of a
permitted user under the Act.
3.4 Learned Senior Counsel Mr. Harshit Tolia would
submit that as per Section 48 of the Act, 1957, the registration
of the plaintiff’s copyright in the “ARJUN” Label serves as
prima facie evidence of the particulars entered therein. This
statutory protection reinforces the plaintiff’s exclusive rights
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over the ARJUN mark, further invalidating the Respondent’s
claims.
3.5 Learned Senior Counsel Mr. Harshit Tolia would
submit that it is important to note that the “ARJUN” label,
designed by Piyushbhai in 1978, was registered under the
Copyright Act in 2006 while Subashbhai was an employee of
the plaintiff. This registration serves as prima facie evidence of
the plaintiff’s rights, which the Trial Court failed to consider.
3.6 Learned Senior Counsel Mr. Harshit Tolia would
submit that the Trial Court has grossly erred by recognizing
rights allegedly held by Subashbhai Pukhrajbhal Shah, who
was merely an employee of the plaintiff and held no ownership
or authority over the “ARJUN” trademark. This
misapprehension led to an unjust conclusion that undermines
the plaintiff’s established proprietary rights.
3.7 Learned Senior Counsel Mr. Harshit Tolia would
submit that in the rectification application filed by Subushbhai
against the plaintiff’s registered trademark “ARJUN”, both
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Subashbhai and the late father of the Respondent explicitly
admitted that they had no objection to the registration of the
“ARJUN” trademark in the plaintiff’s name. This admission
directly contradicts any claims of prior rights or ownership by
the Respondent and highlights the baselessness of the
rectification petition.
3.8 Learned Senior Counsel Mr. Harshit Tolia would
submit that defendant is using the symbol with the “ARJUN”
trademark, despite the fact that only the plaintiff is the
registered proprietor of the trademark “ARJUN”. The
unauthorized use of the symbol indicates an attempt to mislead
the public into believing that defendant holds legitimate rights
over the trademark. This misuse further reveals that defendant
was merely a dealer or distributor of the plaintiff’s goods
bearing the “ARJUN” mark and had no independent rights
over the trademark.
3.9 The Respondent’s claim that Subashbhai granted a
license to use the “ARJUN” trademark is an afterthought with
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no legal or factual basis. There is no written agreement or any
evidence to substantiate such a license or permission, as
required under Section 49(1)(a) of the Trade Marks Act. This
fabricated narrative holds no relevance in the present
proceedings and is a desperate attempt to justify the
defendant’s unauthorized and deceptive use of the trademark
while benefiting from the plaintiff’s established reputation and
goodwill.
3.10 Learned Senior Counsel Mr.Harshit Tolia would submit
that the defendant is a dishonest adopter of the plaintiff’s
registered “ARJUN” trademark. Having previously acted as an
agent or distributor for the plaintiff, the defendant was fully
aware of the plaintiff’s exclusive rights over the trademark. At
no point did the defendant challenge the plaintiff’s registration
of the “ARJUN” mark, further underscoring the defendant’s
acknowledgment of the plaintiff’s ownership. The defendant’s
current unauthorized use of the trademark is a clear act of bad
faith, intended to misappropriate the plaintiff’s market
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reputation and goodwill.
3.11 Learned Senior Counsel Mr.Harshit Tolia would submit
that Subashbhai Shah never challenged the registration or
proprietorship of the plaintiff’s “ARJUN” trademark for more
than 22 years, until the filing of the rectification application in
2022. This prolonged inaction clearly indicates acknowledgment
and acceptance of the plaintiff’s exclusive rights over the
trademark. The rectification application, which appears to be
an afterthought, is still pending decision before the competent
authority.
3.12 Learned Senior Counsel Mr. Harshit Tolia would
submit that the Trial Court acknowledged that no goodwill was
transferred to Subashbhai during the dissolution of SMV in
2004. Yet, paradoxically, it concluded that Subashbhai
continued to use the “ARJUN” mark, without any evidence.
This contradiction reveals a perverse interpretation of facts and
disregards the plaintiff’s continuous and exclusive use of the
trademark since 1988.
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3.13 Learned Senior Counsel Mr. Harshit Tolia would
submit that the plaintiff has invested substantial resources in
marketing, promoting, and maintaining the reputation of the
“ARJUN” trademark, leading to significant goodwill and
consumer recognition. The defendant’s actions constitute a
deliberate attempt to exploit this goodwill. further proving
their intent to deceive consumers and unfairly benefit from the
plaintiff’s established market presence.
3.14 Learned Senior Counsel Mr. Harshit Tolia would
submit that defendant, a former distributor appointed in 2015-
19, has adopted identical packaging and trade dress to that of
the plaintiff. The Court Commissioner appointed under Order
XXVI Rule 9 CPC, found Infringing pouches alongside original
“ARJUN” pouches during the search of the defendant’s
premises in October 2024. This clearly establishes deliberate
passing off and consumer confusion.
3.15 Making the above submission, he would request this
Court to allow the present appeal from order.
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4. SUBMISSION OF THE RESPONDENT – DEFENDANT
4.1 Learned advocate Mr. Mod. Bilal with learned advocate
Mr. Nirad D. Buch & learned advocate Ms. N.A.Trivedi,
appearing for the respondent-defendant, would submit that
registration does not grant any rights over a trademark or
copyright if the rights does not already exist prior to such
registration. It is in relation to prior user and admittedly, the
plaintiff is not a prior user and there is no written assignment
in his favour from alleged prior user, namely, Piyushbhai.
Whereas, defendant is permitted by Piyushbhai to use Trade
name “ARJUN”.
4.2 Learned advocate Mr. Bilal would further submit that
in infringement suit, appellant (i.e. plaintiff) must establish
validity of its registration first.
4.3 Learned advocate Mr. Bilal would further submit that
Court can go into the validity of trademark registration even at
the stage of temporary injunction.
4.4 Learned advocate Mr. Bilal would further submit that
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in registered trademark application, the plaintiff has claimed
user date of 1978 whereas the other 3 registered trademark
applications are, till date, on proposed to be used basis.
However, in the present appeal the plaintiff has claimed user
date of 1988 over the subject mark.
4.5 Learned advocate Mr. Bilal would further submit that
in the suit and applications, the plaintiff has claimed 5
separate dates of its rights/usage for the same subject mark i.e.
1957, 1978, 1988, 1993, 1998, without specifying how it got
rights on any of such dates. Furthermore, he would submit
that despite such different dates of claimed rights, the oldest
document produced by plaintiff is of the year 2000.
4.6 Learned advocate Mr. Bilal would further submit that
despite entirely relying on Sections 31 of Act, 1999 and 48 of
Act, 1957 plaintiff neither filed originals nor certified copies of
any of such registrations nor an exemption application- being
mandatory requirement of the sections. Moreover, no affidavit
under Section 63 of Bhatirya Sakshya Adhiniyam, 2023 is filed
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despite all being digital records.
4.7 Learned advocate Mr. Bilal would further submit that
despite claiming rights on mark – “ARJUN” on the basis of
registration, the plaintiff has no registration for the Mark
-“ARJUN” and hence barred for claiming rights over individual
elements of their registered logos/devices, as per Section 15
and 17 of Act, 1999.
4.8 Learned advocate Mr. Bilal would further submit that
no documents/records of any adoption/publication or of any
use of the claimed logo/device has been filed. The said
logo/device has already been admitted to be first published in
the year 1957 and no registration for the Mark – “ARJUN” is
in favour of the plaintiff. Learned advocate Mr. Bilal would
further submit that no right over trademark or copyright can
be derived from continuous usage if the adoption is not by the
same entity/individual and there is no assignment or
transmission in its favour.
4.9 Learned advocate Mr. Bilal would further submit that
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defendant has filed documents from the year 1983 of the usage
of the subject mark by the SMV – firm. When the partnership
was structured, the subject mark became a property of the
partnership firm as per Section 14 of the Partnership Act,
1932. When the plaintiff and his mother willingly resigned
from it, the partnership was converted into a single
proprietorship firm of Subhashbhai by efflux of law and both
the outgoing partner did not take any properties and assets of
the firm and thus the subject mark remained with Subhashbhai
under his single proprietorship firm – Findings of facts recorded
by trial court.
4.10 Learned advocate Mr. Bilal would further submit that
sole Proprietorship firm is not a separate legal entity and has
no separate identity than its proprietor and even if SMV was
assumed to be closed, the rights over the subject mark
remained with Subhashbhai as all rights and assets of single
proprietorship firm are of its proprietor alone.
4.11 Learned advocate Mr. Bilal would further submit that
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since Subhashbhai has permitted defendant as well as the
plaintiff (till the year 2022), there was no
non-usage/abandonment of rights by Subhashbhai as even if
the proprietor is not using a trademark and its usage is by
another individual permitted by the proprietor, its usage
amounts to goodwill in favour of the proprietor.
4.12 Learned advocate Mr. Bilal would further submit that
if the trial court in a case of this nature has refused to
exercise discretion in favour of the plaintiff, the Appellate
court cannot either reassess materials on record or reverse such
discretion even if it takes a different view meaning thereby,
cannot substitute its own discretion, provided such exercise of
discretion by trial court was on objective consideration of
materials and supported by cogent reasons. Such discretion of
the trial court can only be reversed if the trial court did not
apply principles of law correctly or acted arbitrarily, estat
perversely or capriciously.
4.13 Learned advocate Mr. Bilal would further submit that
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permission to use the trademark can be oral and need not be
in writing.
4.14 Learned advocate Mr. Bilal would further submit that
since the permission has been withdrawn from the plaintiff by
Subhashbhai, he himself is an infringer/illegal user and
passing-off goods of Subhashbhai. Learned advocate Mr. Bilal
would further submit that one alleged infringer of a
trademark/copyright cannot sue another and if the plaintiff
himself does not have any prior rights over trademark, he can
obtain no equitable/injunctive relief.
4.15 Learned advocate Mr. Bilal would further submit that
Subhashbhai, who filed rectification/oppositions on plaintiff’s
applications, is disputing the rights of plaintiff since 2022 and
plaintiff also had knowledge that Subhashhbhai has declared in
such petitions that defendant is its permitted user. The duty
was upon appellant/plaintiff to include Subhasbhbhai (necessary
party) in the present suit and cannot take advantage of its own
wrong.
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4.16 Lastly, learned advocate Mr. Bilal would further submit
that following material concealments by plaintiff in suit, which
disentitles him from claiming interim relief based on equity:-
4.16.1 In the present case, plaintiff made no
averment/disclosure about the structure of the firm
SMV, its structural changes over time and that the
plaintiff was itself its partner and retired/resigned from
it willingly.
4.16.2 Plaintiff did not disclose that rights over
the Mark are being disputed by his own elder brother.
4.16.3 Plaintiff did not disclose that it has
submitted in its evidence affidavit that it acquired
rights through “transfer” despite not producing any
written assignment deed.
4.16.4 Plaintiff did not disclose that the
Respondent is purchasing merely raw materials from
the plaintiff and packaging and placing the subject
mark on its own. 40+ invoices have been filed by
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Respondent to prove such facts all of which are w/o
the subject mark and since the year 2017. However,
despite claiming that the Respondent is its wholesaler,
plaintiff only produced 5 invoices only of the year
2021 and 2022.
4.16.5 Plaintiff claimed that it stopped
supplying goods to the Respondent in October, 2023,
however invoices and ledger of the Respondent with
plaintiff proves that he was supplying such goods on
constant basis till August, 2024.
4.16.6 Prior adoption and use of the subject
mark by another individual/entity (i.e., SMV) than the
plaintiff.
4.17 Moreover, learned advocate for the defendant would
submit that there are material delay, laches and acquiescence
and the present suit is for injunction simpliciter seeking relief
of declaration despite the suit property being disputed and also
barred by Section 41(h) of the Specific Relief Act.
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4.18 Making the above submissions, he prayed to reject the
present appeal.
5. POINTS OF DETERMINATION
5.1 The following points are considered in regard to the
issue involved in the suit, which read as under:
1. Whether, in the facts and circumstances of
the case, can this court interfere with the
impugned order by exercising its power under
Order 43 Rule 1 of the CPC?
2. Whether, in the facts and circumstances of
the case, the Trial Court has committed an
error of law by holding that the plaintiff has
not made out any prima facie case?
3. Whether, in the facts and circumstances of
the case, the plaintiff has made out a case that
it is holding registration certificates under the
Trademark Act and Copyright Act respectively
in relation to the name and work of “ARJUN”
on its selling pouches?
4. Whether, in the facts of the case, the
plaintiff is entitled to get an injunction as
prayed for in its injunction application or not?
ANALYSIS
6. Before adverting to the issues germane in the present
appeal, I would like to remind myself of the limitation of this
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court while exercising its power under Order 43 of the CPC,
which is so clearly held by the Honorable Supreme Court of
India in its following decisions.
i. Wander Ltd V/s Antox India P. Ltd. reported in 1990
(1) Supp. SCC 727;
ii. Ramakant Ambalal Choksi V/s Harish Ambalal Choksi
reported in 2024 SCC Online SC 3538.
7. What is culled out from the aforesaid decision of the
Honorable Apex Court of India is that the appellate court
should not exercise its power under Order 43 of the CPC,
unless and until there is arbitrariness, perversity, erroneous
observation and the issue is decided contrary to the settled
position of law. The appellate court should not disturb the
discretionary order passed by the Trial Court while granting or
refusing an injunction application filed under Order 39 Rule 1
of the CPC.
8. Keeping in mind the aforesaid ratio of both the decisions,
I would like to examine the issues cropped up and raised in
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the appeal by the plaintiff.
9. The following facts, which remained undisputed before
the Trial Court, reads as under:
9.1 One Pukhrajbhai, who happens to be the father of the
proprietor of the plaintiff, namely, Piyushbhai, and
Subhashbhai – the power of attorney holder of the defendant,
had started a business in the name of the SMV – firm. The
firm was selling its goods and spices, more particularly, cumin
under the brand name of “ARJUN.”
9.2 The SMV – firm was converted from a proprietary firm
to a partnership in the year 1983 on the demise of the father
of the plaintiff, and the proprietor of the plaintiff, namely,
Piyushbhai, and Subhashbhai, the power of attorney holder of
the defendant. Piyushbhai, Subhashbhai, and their mother
Deviben became partners of the SMV partnership firm.
9.3 Clause-18 of the partnership firm clearly states that in
case, any of the partners retired or the firm was closed, there
would not be any goodwill of the firm.
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9.4 The SMV – partnership firm was dissolved on 31st
March, 1994, which is confirmed from the declaration and
statement of Deviben, the mother of Piyushbhai and
Subhashbhai. The plaintiff – firm has been doing business
since 1988 in the area of selling spices, more particularly,
cumin.
9.5 The SMV – partnership firm again got converted into
the proprietary firm of Subhashbhai, as Piyushbhai and his
mother – Deviben retired from the firm. The SMV – partnership
firm, which was using the mark “ARJUN,” got dissolved on
31st March, 1994.
9.6 As per Clause-18 of the partnership deed of the SMV –
firm, it was clearly spelt out that either on retirement or
dissolution of the firm, there would not be any goodwill of the
firm. So, Subhashbhai, who became the proprietor of the SMV
– firm, could not have carried the goodwill of the SMV
partnership firm, thereby could not have exclusive rights or
ownership of the mark “ARJUN”.
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9.7 The plaintiff applied for the trademark “ARJUN” on
10th August, 1993, and registration was granted on 14th June,
2000, with effect from 10th August, 1993, which is admittedly
prior to the dissolution of the SMV – partnership firm. The
plaintiff has also obtained a copyright certificate for artistic
work, which was published for the first time in the year,
1978, and the name of the applicant is shown as Piyushbhai
Shah, namely, the proprietor of the plaintiff – firm. The extract
of such a certificate is produced on record and confirms the
aforesaid facts.
9.8 Thus, the plaintiff is holding a certificate of the
trademark “ARJUN” and also holding a copyright certificate in
its name.
10. Subhashbhai – the proprietor of the SMV – firm, appears
to have closed down his business long back in the year, 2013,
and there was no evidence to show that as on the date of
filing of the suit, he was doing any business in the name and
style of SMV – firm. The plaintiff – firm has submitted its
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accounts to show that Subhashbhai was employed by it and
used to pay a salary to Subhashbhai.
11. It is true that the power of attorney holder of the
defendant, namely, Subhashbhai, who happens to be the
brother of Piyushbhai – the proprietor of the plaintiff, has
submitted an objection to such a trademark vide his
application dated 6th January, 2022 before the competent
authority under the Act, 1999, which is pending for its
adjudication. Nonetheless, when the plaintiff applied for
trademark in the year, 1993, at that time, Subhasbhai has not
objected to such application.
12. Once it has come on record that the plaintiff is holding
the registration of the trademark “ARJUN” and the copyright
certificate, the observation of the Trial Court ignoring both the
certificates that the plaintiff has not made out a prima facie
case is an erroneous finding on the part of the Trial Court.
13. Thus, the suit in question is filed for infringement of
Trademark and Copyright as well as passing off of trademark.
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14. It is a well-settled legal position that if the trademark is
registered, undisputedly, the use thereof by a person who is
not authorized to do so, would constitute infringement. A
proprietor of a registered trademark undisputedly has a
statutory right thereto. If other than permissible user uses it,
such a proprietor will have a statutory remedy in terms of
Section 29 of the Act, 1999.
15. At this stage, it is profitable to refer to and rely upon
the decision of the Honorable Apex Court of India in the case
of Ramdev Food Products (P) Ltd. vs. Arvindbhai Rambhai
Patel, reported in 2006 (8) SCC 726; 2006 (0) AIJEL-SC 37749,
in paras 52 and 114, wherein it has been held as under:-
“Purpose of Trade mark
52. A trade mark is the property of the manufacturer.
The purpose of a trade mark is to establish a connection
between the goods and the source thereof which would
suggest the quality of goods. If the trade mark is registered,
indisputably, the user thereof by a person who is not
otherwise authorised to do so would constitute infringement.
Section 21 of the 1958 Act provides that where an
application for registration is filed, the same can be opposed.
Ordinarily under the law and, as noticed hereinbefore, there
can only be one mark, one source or one proprietor.
Ordinarily again right to user of a trade mark cannot have
two origins. The first respondent herein is a rival trader ofPage 31 of 57
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the plaintiff-Company. It did not in law have any right to use
the said trade mark, save and except by reason of the terms
contained in the MOU or continuous user. It is well-settled
that when defences in regard to right of user are set up, the
onus would be on the person who has taken the said plea. It
is equally well-settled that a person cannot use a mark
which would be deceptively similar to that of the registered
trade mark. Registration of trade marks is envisaged to
remove any confusion in the minds of the consumers. If,
thus, goods are sold which are produced from two sources,
the same may lead to confusion in the mind of the
consumers. In a given situation, it may also amount to fraud
on the public. A proprietor of a registered trade mark
indisputably has a statutory right thereto. In the event of
such use by any person other than the person in whose
name the trade mark is registered, he will have a statutory
remedy in terms of Section 21 of the 1958 Act. Ordinarily,
therefore, two people are not entitled to the same trade
mark, unless there exists an express licence in that behalf.
113. Registration of a trade mark and user thereof per se
may lead to the conclusion that the plaintiff has a prima
facie case, however, existence thereof would also depend
upon the determination of the defences raised on behalf of
the respondents. The plaintiff has raised a triable issue. The
same by itself although may not be sufficient to establish a
prima facie case but in view of our findings aforementioned,
we are satisfied that the plaintiff has been able to establish
existence of a legal right in itself and violation of the
registered trade mark on the part of the respondents. We
have also considered the comparable strength of the cases of
the parties and are of the opinion that the case of the
plaintiff-appellant stands on a better footing than the
defendants-respondents.”
(Emphasis Supplied)
16. The Trial Court erroneously observed in para-27 of its
impugned judgment that due to the dispute between the
plaintiff and Subhashbhai for the trademark “ARJUN” pending
before the competent authority, the injunction application
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cannot be decided. Such an observation of the Trial Court is in
complete ignorance of Section 124(5) of the Act, 1999. Section
124(5) of the Act, 1999 reads as under:
“124. Stay of proceedings where the validity of registration
of the trade mark is questioned, etc.–
(5) The stay of a suit for the infringement of a trade mark under
this section shall not preclude the court from making any
interlocutory order (including any order granting an injunction
directing account to be kept, appointing a receiver or attaching
any property), during the period of the stay of the suit.”
17. The Trial Court has further erroneously observed in para-
28 of its judgment that neither the defendant nor Subhashbhai
has allowed the plaintiff to register the mark “ARJUN” at the
time of its registration and further erroneously observed that
when the plaintiff and his mother waived their rights in favour
of Subhashbhai, who has been using the mark “ARJUN” since
long, no infringement can be claimed against Subhashbhai as
per Section 29 of the Act, 1999. The Trial Court is oblivious of
the crucial fact that the suit is not filed against Subhashbhai
but against the defendant firm, namely, Ashish Traders, albeit,
the written statement was filed by Subhashbhai as the power
of attorney holder of the defendant – Ashish Traders.
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18. The Trial Court has escaped from its notice the crucial
fact that Subhashbhai has discontinued his proprietary firm,
namely, the SMV firm, since 2013 by surrendering its license
under the Shop and Establishment Act and APMC, as the case
may be. The relevant documentary evidence is submitted by
the plaintiff, which is not controverted by the defendant. Even
it is not the case of the defendant that SMV – Firm is alive as
on date.
19. So, as on the date of filing of the suit, nothing is on
record to substantiate the claim of the defendant that
Subhashbhai was running his business in the name of the SMV
– firm by using the mark “ARJUN.”
20. When the plaintiff has, prima facie, established on record
that he is not only having the registration of the mark
“ARJUN” with effect from 10th August, 1993 and 14th June,
2000 but also prima facie proved that it is holding the
copyright certificate showing first publication in the year,
1978, and having come on record that Subhashbhai has
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discontinued his firm after 2013, it entirely collapses the
defense of the defendant about given permission by
Subhashbhai being prior user of the mark “ARJUN” to the
defendant to use it.
21. Such an aspect of prior user and user of the mark in the
context of Section 34 of the Act,1999 has been succinctly
observed and discussed by the Bombay High Court [Honorable
Mr. Justice D.Y. Chandrachud, as he then was], in the case of
Kamat Hotels (India) Ltd. vs. Royal Orchid Hotels Ltd. ,
reported in 2011 SCC Online Bom 460, in paras 19 and 20,
wherein it has been held as under:
“[19] In order to avail of the benefit of Section 34 of the Trade
Marks Act 1999 the mere change of name of the First
Defendant with effect from 10 April 1997 will not suffice. The
First Defendant must demonstrate that the mark was utilized
in relation to the goods and services for which the mark of the
plaintiff was registered and that the use of the First Defendant
was prior to the registration, or as the case may be, the use of
the mark by the plaintiff. In this regard, reliance has been
sought to be placed on behalf of the First Defendant on certain
circumstances in the affidavits in reply to which it would now
be necessary to turn. The first of those circumstances is the
alleged adoption of the mark “Orchid” in respect of a banquet
room at Hotel Harsha in Bangalore. In the Bangalore edition of
the Times of India of 30 December 1990 there is a publication
in respect of the Orchid room at Harsha Hotel. The next
document is a report dated 23 April 1999 of the Zonal Manager
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Defendant. The report inter alia states that the First Defendant
had been promoted by C.K. Baljee. Baljee had promoted a
company by the name of Baljees Hotels and Real Estates
Private Limited in 1973 and took over a Two Star Hotel, Hotel
Harsha in Bangalore on an operational lease from Hotel Stay
Longer Private Limited (HSPL). Baljee had since acquired the
controlling interest in HSPL which owned Hotel Harsha.
Counsel appearing on behalf of the First Defendant also
purported to rely upon a letter addressed to the Joint Director
of Town Planning at Bangalore on 16 September 1999 and a
certificate dated 17 December 1999 issued by the Government
of India in the Ministry of Commerce and Industry.
[20] All these documents (save and except for the
isolated advertisement of 1990) relate to the period after the
plaintiff had commenced the use of the mark “Orchid”. Those
documents do not even prima facie establish a use, much less
continuous use, prior to the date on which the plaintiff had
commenced the use of the mark. Significantly, the First
Defendant has not disclosed any sales figures that would
establish a continuous course of use of the mark “Orchid” prior
to the date on which the plaintiff commenced the use of the
mark. There is merit in the contention which has been urged
on behalf of the plaintiff that the reference to a room in Hotel
Harsha as being the Orchid room is not sufficient to establish
within the meaning of Section 34 a continuous use by the First
Defendant of the mark in relation to the goods and services for
which the mark has been registered by the plaintiff. But it is
important to note that the First Defendant is unable to
establish by any cogent documentary material the existence of
such continuous use. Where a Defendant sets up a defence
under Section 34, the consequence of allowing it is to dilute
the protection granted to a proprietor of a registered mark. The
Defendant must be held down to establish the
requirements of Section 34 by cogent material which
indicates continuous prior use. A single swallow does not
make a summer. The Defendants have not established a
crucial requirement of Section 34.”
(Emphasis Supplied)
22. The Trial Court has again committed a serious error by
erroneously observing in para 31 that the father of the plaintiff
and the defendant was using the name “ARJUN” while doing
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business in the name of the SMV – firm. Admittedly, as on
date of suit, the proprietor of the defendant firm is not the
real brother of the proprietor of the plaintiff – firm. The power
of attorney of holder of the defendant – firm, of course, is the
real brother of the proprietor of the plaintiff firm. It appears
that the Trial Court has erroneously and perversely treated the
relationship of the power of attorney of the defendant firm
with the plaintiff as a relation of the defendant itself with the
plaintiff.
23. The Trial Court has further committed a serious error of
law by observing in paras 38 and 41 that when Subhashbhai
has allowed both the plaintiff and the defendant to use the
mark “ARJUN,” it would not be the exclusive right of the
plaintiff to use the mark “ARJUN.” It is an admitted position
that no written agreement was entered into between
Subhashbhai and the defendant for using the mark “ARJUN,”
and then, prima facie, under Section 2 (1) (r) (ii) (c) of the
Act, 1999, the defendant would not fall within the category of
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permitted user of the trademark. So far as the plaintiff – firm
is concerned, it is a registered mark holder as referred to
hereinabove.
24. Likewise, the Trial Court has recorded a perverse finding
that merely because the plaintiff firm has registration of the
trademark “ARJUN” under the Act, 1999 and copyright under
the Act, 1957, it would not ipso facto wipe out the right of
Subhashbhai over the brand name “ARJUN.” The suit is not
filed against Subhashbhai but against the defendant – firm,
wherein Subhashbhai was neither a partner nor acted with the
defendant – firm except as the power of attorney holder. It
seems that the Trial Court has considered the defence of the
defendant from the eye of the power of attorney holder of the
defendant rather than from the defendant firm itself. Because
of such an erroneous and perverse approach on the part of the
Trial Court, it has resulted in refusing the injunction in favour
of the plaintiff.
25. The Trial Court has further erroneously observed that the
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plaintiff has come before the Court after a period of one year
from knowing the fact that the defendant – firm is infringing
his mark and selling the product under the brand name of
“ARJUN” in society, thereby not being entitled to claim an
injunction. Such an approach on the part of the Trial Court is
erroneous and perverse and contrary to the law laid down by
the Honorable Supreme Court of India in the case of Midas
Hygiene Industries (P) Ltd Versus Sudhir Bhatia reported in
(2004) 3 SCC 90, wherein in para 5, it has been held as
under:-
“[5] The law on the subject is well settled. In
cases of infringement either of trade mark or of
copyright, normally an injunction must follow.
Mere delay in bringing action is not sufficient to
defeat grant of injunction in such cases. The grant
of injunction also becomes necessary if it prima facie
appears that the adoption of the mark was itself
dishonest.”
(Emphasis supplied)
26. It also remains undisputed during the course of the
hearing of the appeal that as per Clause 18 of the partnership
deed of the SMV – firm, it has been agreed between the
partners of the SMV – firm, namely, Piyushbhai, Subhashbhai
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and Deviben, that in a case where the firm gets dissolved or
any of the partners retires from the firm, there would not be
any goodwill of the firm.
27. When Piyushbhai – the proprietor of the plaintiff – firm
and his mother – Deviben retired from the firm in the year,
1994 as well as the firm got dissolved, there would not be any
goodwill of the firm, thereby, prima facie, the mark “ARJUN”
could not have been an exclusive right in favour of
Subhashbhai, who became the proprietor of the SMV
proprietary firm.
28. In the case of a trademark, it has always been considered
as a vital and inseparable part of the goodwill of the business.
Once there is no goodwill of a business, the question of using
and having an exclusive right to the trademark used by the
firm would not arise. It is profitable to refer to the observation
made by the Honorable Supreme Court of India in the case of
Ramdev (supra), wherein in paras 59 and 60, it has been held
as under:
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“Trade mark and goodwill
59. Traditionally, a trade mark has always been considered a
vital and inseparable part of the goodwill of the: business. In
fact, the sale of a trade mark without the sale of the goodwill
to the same buyer is considered null and void. However, the
trade mark can be assigned with or without the goodwill of
business though subject to certain conditions. [See V.A.
Mohta’s Trade Marks, Passing Off and Franchising, pages 12,
313.]
Entitlement to use
60. The contention of the appellant before the
courts below was that its right to the said trade mark has
been entrenched by the respondents on account of use of the
same as part of the trade name in view of the fact that
although it has started the business in the trade name
‘Swad’, the first respondent, on the label and the packing
material of the said product, had printed the name of the
manufacturer ‘Ramdev Masala’ in such a prominent manner
that the same would create an impression in the mind of the
ordinary unwary customer that the same is a product of the
appellant Company. It also alleged that the respondents had
adopted advertisements, marketed and displayed boards in
such a manner so as to deliberately deceive the customer.”
(Emphasis supplied)
29. So, when the SMV firm got dissolved in the year, 1994,
and later on, Subhashbhai discontinued his SMV – proprietary
firm in the year, 2013, he would not be holding any goodwill
of the firm with him, which can be assignable in favour of
anyone in light of the aforesaid peculiar facts and
circumstances of the case, which have come on record.
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30. Now, when the plaintiff has established a prima facie
case that the plaintiff is having registration of the trademark
under the Trademark Act, 1999 in its favour since 1993, and
also having registration under the Copyright Act, 1957, the
relief by way of an interim injunction would be material in a
suit for infringement of a trademark. Furthermore, the
defendant was neither a prior user than the plaintiff nor
having any written assignment of using the mark “ARJUN”
from an alleged permitted user, nor holding any registration
mark of “ARJUN” in his favour. So, defendant cannot be
permitted to use the mark “ARJUN” on packaging pouches for
selling spices, more particularly, cumin. The colour of the
pouches carrying the name “ARJUN” used by the plaintiff –
firm as well as the defendant – firm was submitted before the
Trial Court and the same is submitted for ready perusal of this
court during the course of the argument, which prima facie
clearly establish that the mark used by the defendant – firm is
deceptively similar to that used by the plaintiff – firm, who is
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the registered mark holder of “ARJUN.”
31. As the defendant is using the same product as the
plaintiff, albeit, using the registered name of the plaintiff –
“ARJUN” on his pouches, the balance of convenience would
be in favour of the plaintiff, being not only a prior user but
also holding the registration mark in his favour.
32. So far as the question of irreparable loss is concerned, it
would tilt in favour of the plaintiff as the product used by the
defendant is the same as that used by the plaintiff, thereby a
common user, who uses such product gets confused while
buying such product, thereby it seriously affects the reputation
of the plaintiff’s firm, established since 1988 in the market.
33. As such, in this type of case, actual irreparable loss is
not required to be established on record. At this stage, it is
profitable to refer to and rely upon the observation made by
the Honorable Supreme Court of India in the case of Ramdev
(supra), wherein in paras 121, 122, and 123, it has been held
as under:-
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“121. Kerly’s Law of Trade Marks and Trade Names,
Thirteenth Edition states as under about the general test for
grant of an interim injunction:
“In trade mark infringement cases irreparable
damage, in this sense, is relatively easily shown,
since infringement may easily destroy the value of a
mark or at least nullify expensive advertising in a
way that is hard to quantify for the purposes of an
inquiry into damages. This has more recently come
to be referred to, in cases where the defendant’s
conduct is not directly damaging but merely
reduces the distinctive character of the claimant’s
mark, as “dilution”….
…In particular, although it is usually neither
necessary nor appropriate to assess the degree of
probability of success which the claimant’s action
has (provided that it is arguable, and subject to the
principle of American Cyanamid that the merits
may be resorted to as a ‘tie breaker’ if the balance
of convenience is very even,) in trade mark and
passing off cases, it is very hard to avoid doing so,
since the better the claimant’s case on the
likelihood of deception (frequently the major issue)
the greater the harm which he is likely to suffer.
Accordingly, in appropriate cases, where the state
of the evidence permits it, the court may seek to
weigh up the merits in deciding whether to grant
interim relief.”
122. Thus, when a prima facie case is made out and balance of
convenience is in favour of the appellant, it may not be
necessary to show more than loss of goodwill and reputation to
fulfil the condition of irreparable injury. In fact, if the first two
prerequisites are fulfilled, in trade mark actions irreparable
loss can be presumed to have taken place.
123. The expression “irreparable injury” in that sense would
have established injury which the plaintiff is likely to suffer.”
(Emphasis supplied)
34. At this stage, I would like to refer and rely upon the full
bench decision of Honourable Apex Court in a case of
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Renaissance Hotel Holdings Inc V/S B Vijaya Sai and Others
reported in (2022) 5 SCC 1 wherein held as under:-
“[47] It could thus be seen that in all legal proceedings
relating to trade mark registered under the said Act, the
original registration of the trade mark and of all
subsequent assignments and transmissions of the trade
mark shall be prima facie evidence of the validity
thereof.
[48] The legislative scheme is clear that when the mark of the
defendant is identical with the registered trade mark of the
plaintiff and the goods or services covered are similar to the
ones covered by such registered trade mark, it may be
necessary to prove that it is likely to cause confusion on the
part of the public, or which is likely to have an association
with the registered trade mark. Similarly, when the trade
mark of the plaintiff is similar to the registered trade mark of
the defendant and the goods or services covered by such
registered trade mark are identical or similar to the goods or
services covered by such registered trade mark, it may again
be necessary to establish that it is likely to cause confusion
on the part of the public. However, when the trade mark of
the defendant is identical with the registered trade mark
of the plaintiff and that the goods or services of the
defendant are identical with the goods or services
covered by registered trade mark, the Court shall
presume that it is likely to cause confusion on the part
of the public.
[49] Having considered the legislative scheme as has been
elaborately provided in the said Act, it will be apposite to
refer to the observations of this Court, while considering
Section 21 of The Trade Marks Act, 1940 in the case of
Kaviraj Pandit Durga Dutt Sharma (supra):
“28. The other ground of objection that the findings
are inconsistent really proceeds on an error in
appreciating the basic differences between the
causes of action and right to relief in suits for
passing off and for infringement of a registered trade
mark and in equating the essentials of a passing off
action with those in respect of an action
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mark. We have already pointed out that the suit by
the respondent complained both of an invasion of a
statutory right under Section 21 in respect of a
registered trade mark and also of a passing off by
the use of the same mark. The finding in favour of
the appellant to which the learned counsel drew our
attention was based upon dissimilarity of the
packing in which the goods of the two parties were
vended, the difference in the physical appearance of
the two packets by reason of the variation in the
colour and other features and their general get-up
together with the circumstance that the name and
address of the manufactory of the appellant was
prominently displayed on his packets and these
features were all set out for negativing the
respondent’s claim that the appellant had passed off
his goods as those of the respondent. These matters
which are of the essence of the cause of action for
relief on the ground of passing off play but a limited
role in an action for infringement of a registered
trade mark by the registered proprietor who has a
statutory right to that mark and who has a statutory
remedy for the event of the use by another of that
mark or a colourable imitation thereof. 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. No doubt, where the
evidence in respect of passing off consists merely of
the colourable use of a registered trade mark, the
essential features of both the actions might coincide
in the sense that what would be a colourable
imitation of a trade mark in a passing off action
would also be such in an action for infringement of
the same trade mark. But there the correspondence
between the two ceases. In an action forPage 46 of 57
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infringement, the plaintiff must, no doubt, make out
that the use of the defendant’s mark is likely to
deceive, but where the similarity between the
plaintiff’s and the defendant’s mark is so close either
visually, phonetically or otherwise and the court
reaches the conclusion that there is an imitation, no
further evidence is required to establish that the
plaintiff’s rights are violated. Expressed in another
way, if the essential features of the trade mark of the
plaintiff have been adopted by the defendant, the
fact that the get-up, packing and other writing or
marks on the goods or on the packets in which he
offers his goods for sale show marked differences, or
indicate clearly a trade origin different from that of
the registered proprietor of the mark would be
immaterial; whereas in the case of passing off, the
defendant may escape liability if he can show that
the added matter is sufficient to distinguish his
goods from those of the plaintiff.”
[50] It could thus be seen that this Court has pointed out the
distinction between the causes of action and right to relief in
suits for passing off and for infringement of registered trade
mark. It has been held that the essentials of a passing off
action with those in respect of an action complaining of an
infringement of a registered trade mark, cannot be equated.
It has been held that though an action for passing off is a
Common Law remedy being an action for deceit, that is,
a passing off by a person of his own goods as those of
another; the action for infringement is a statutory right
conferred on the registered proprietor of a registered
trade mark for the vindication of the exclusive rights to
the use of the trade mark in relation to those goods. The
use by the defendant of the trade mark of the plaintiff is
a sine qua non in the case of an action for infringement.
It has further been held that if the essential features of
the trade mark of the plaintiff have been adopted by the
defendant, the fact that the get-up, packing and other
writing or marks on the goods or on the packets in which
he offers his goods for sale show marked differences, or
indicate clearly a trade origin different from that of the
registered proprietor of the mark, would be immaterial in
a case of infringement of the trade mark, whereas in the
case of a passing off, the defendant may escape liability
if he can show that the added matter is sufficient to
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distinguish his goods from those of the plaintiff.
[51] Again, while considering the provisions of Section 21 of
the 1940 Act, this Court in the case of Ruston & Hornsby
Limited (supra), observed thus:
“4. It very often happens that although the
defendant is not using the trade mark of the
plaintiff, the get up of the defendant’s goods may be
so much like the plaintiff’s that a clear case of
passing off would be proved. It is on the contrary
conceivable that although the defendant may be
using the plaintiff’s mark the get up of the
defendant’s goods may be so different from the get
up of the plaintiff’s goods and the prices also may
by so different that there would be no probability of
deception of the public. Nevertheless, in an action
on the trade mark, that is to say, in an
infringement action, an injunction would issue as
soon as it is proved that the defendant is
improperly using the plaintiff’s mark.
5. The action for infringement is a statutory right. It
is dependent upon the validity of the registration
and subject to other restrictions laid down in
Sections 30, 34 and 35 of the Act. On the other
hand the gist of a passing off action is that A is not
entitled to represent his goods as the goods of B
but it is not necessary for B to prove that A did this
knowingly or with any intent to deceive. It is
enough that the get-up of B’s goods has become
distinctive of them and that there is a probability of
confusion between them and the goods of A. No
case of actual deception nor any actual damage
need be proved. At common law the action was not
maintainable unless there had been fraud on A’s
part. In equity, however, Lord Cottenham, L.C., in
Millington v. Fox [3 My & Cr 338] held that it was
immaterial whether the defendant had been
fraudulent or not in using the plaintiff’s trade mark
and granted an injunction accordingly. The
common law courts, however, adhered to their view
that fraud was necessary until the Judicature Acts,
by fusing law and equity, gave the equitable rule
the victory over the common law rule.
6. The two actions, however, are closely similar in
some respects. As was observed by the Master ofPage 48 of 57
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the Rolls in Saville Perfumery Ltd. v. June Perfect
Ltd. [58 RPC 147 at 161] :
“The statute law relating to infringement of
trade marks is based on the same
fundamental idea as the law relating to
passing-off. But it differs from that law in
two particulars, namely (1) it is concerned
only with one method of passing-off,
namely, the use of a trade mark, and (2) the
statutory protection is absolute in the sense
that once a mark is shown to offend, the
user of it cannot escape by showing that by
something outside the actual mark itself he
has distinguished his goods from those of
the registered proprietor. Accordingly, in
considering the question of infringement
the Courts have held, and it is now
expressly provided by the Trade Marks Act,
1938, Section 4, that infringement takes
place not merely by exact imitation but by
the use of a mark so nearly resembling the
registered mark as to be likely to deceive.””
[52] It could thus be seen that this Court again reiterated
that the question to be asked in an infringement action is as
to whether the defendant is using a mark which is same as,
or which is a colourable imitation of the plaintiff’s registered
trade mark. It has further been held that though the get up
of the defendant’s goods may be so different from the
plaintiff’s goods and the prices may also be so different that
there would be no probability of deception of the public,
nevertheless even in such cases, i.e., in an infringement
action, an injunction would be issued as soon as it is
proved that the defendant is improperly using the
plaintiff’s mark. It has been reiterated that no case of
actual deception nor any actual damage needs to be
proved in such cases. This Court has further held that
though two actions are closely similar in some respects,
in an action for infringement, where the defendant’s
trade mark is identical with the plaintiff’s trade mark,
the Court will not enquire whether the infringement is
such as is likely to deceive or cause confusion.”
(Emphasis supplied)
35. It is also profitable to place reliance upon the decision of
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Honourable Supreme Court of India in a case of Laxmikant V
Patel V/S Chetanbhai Shah reported in (2002) 3 SCC 65 touch
upon the issue of granting an injunction in the case of passing
off held as under:-
“[8] It is common in the trade and business for a trader or a
businessman to adopt a name and/or mark under which he
would carry on his trade or business. According to Kerly {Law
of Trade Marks and Trade Names, Twelfth Edition, Para
16.49), the name under which a business trades will almost
always be a trade mark (or if the business provides services,
a service mark, or both). Independently of questions of trade
or service mark, however, the name of a business (a trading
business or any other) will normally have attached to it a
goodwill that the Courts will protect. An action for passing off
will then lie wherever the defendant company’s name, or its
intended name, is calculated to deceive, and so to divert
business from the plaintiff, or to occasion a confusion
between the two businesses. If this is not made out, there is
no case. The ground is not to be limited to the date of the
proceedings; the Court will have regard to the way in which
the business may be carried on in the future, and to its not
being carried on precisely as carried on at the date of the
proceedings. Where there is probability of confusion in
business, an injunction will be granted even though the
defendants adopted the name innocently.
[9] It will be useful to have a general view of certain statutory
definitions as incorporated in the Trade Marks Act, 1999.
The definition of trade mark is very wide and means,
inter alia, a mark capable of being represented
graphically and which is capable of distinguishing the
goods or services of one person from those of others.
Mark includes amongst other things name or word also.
Name includes any abbreviation of a name.
[10] 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 as
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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 result in confusion and has propensity
of diverting the customers and clients of someone else
to himself and thereby resulting in injury.
[11] Salmond & Heuston in Law of Torts (Twentieth Edition,
at page 395) call this form of injury as ‘injurious falsehood’
and observe the same having been ‘awkwardly termed’ as
‘passing off and state :-
“The legal and economic basis of this tort is to provide
protection for the right of property which exists not in a
particular name, mark or style but in an established
business, commercial or professional reputation or
goodwill. So to sell merchandise or carry on business
under such a name, mark, description or otherwise in
such a manner as to mislead the public into believing
that the merchandise or business is that of another
person is a wrong actionable at the suit of that other
person. This form of injury is commonly, though
awkwardly, termed that of passing off one’s goods or
business as the goods or business of another and is the
most important example of the wrong of injurious
falsehood. The gist of the conception of passing off
is that the goods are in effect telling a falsehood
about themselves, are saying something about
themselves which is calculated to mislead. The law
on this matter is designed to protect traders
against that form of unfair competition which
consists in acquiring for oneself, by means of false
or misleading devices, the benefit of the reputation
already achieved by rival traders.”
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[12] In Oertil v. Bowman, 1957 RPC 388, (at page 397):
1957 CLY 3549, the gist of passing off action was defined
by stating that it was essential to the success of any claim
to passing off based on the use of given mark or get-up that
the plaintiff should be able to show that the disputed mark
or get-up has become by user in the country distinctive of
the plaintiff’s goods so that the use in relation to any goods
of the kind dealt in by the plaintiff of that mark or get-up
will be understood by the trade and the public in that
country as meaning that the goods are the plaintiff’s goods.
It is in the nature of acquisition of a quasi-proprietary right
to the exclusive use of the mark or get-up has relation to
his goods. Such right is invaded by anyone using the same
or some deceptively similar mark, get-up or name in
relation to goods not of plaintiff. The three elements of
passing off action are the reputation of goods, possibility of
deception and likelihood of damages to the plaintiff. In our
opinion, the same principle, which applies to trade mark, is
applicable to trade name.
[13] In an action for passing off it is usual, rather
essential, to seek an injunction temporary or ad-
interim. The principles for the grant of such injunction
are the same as in the case of any other action against
injury complained of. The plaintiff must prove a prima
facie case, availability of balance of convenience in his
favour and his suffering an irreparable injury in the
absence of grant of injunction. According to Kerly {Ibid,
Para 16.16) passing off cases are often cases of deliberate
and intentional misrepresentation, but it is well-settled that
fraud is not a necessary element of the right of action, and
the absence of an intention to deceive is not a defence
though proof of fraudulent intention may materially assist a
plaintiff in establishing probability of deception.
Christopher Wadlow in Law of Passing Off (1995 Edition, at
p. 3.06) states that the plaintiff does not have to prove
actual damage in order to succeed in an action for passing
off. Likelihood of damage is sufficient. The same learned
author states that the defendant’s state of mind is wholly
irrelevant to the existence of the cause of action for passing
off (Ibid Paras 4.20 and 7.15). As to how the injunction
granted by the Court would shape depends on the facts and
circumstances of each case. Where a defendant has
imitated or adopted that plaintiffs distinctive trade mark or
business name, the order may be an absolute injunctionPage 52 of 57
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that he would not use or carry on business under that
name. (Kerly, ibid, Para 16.97)[17] We are conscious of the law that this Court would
not ordinarily interfere with the exercise of discretion
in the matter of grant of temporary injunction by the
High Court and the trial Court and substitute its own
discretion therefore except where the discretion has
been shown to have been exercised arbitrarily or
capriciously or perversely or where the order of the
Court under scrutiny ignores the settled principles of
law regulating grant or refusal of interlocutory
injunction. An appeal against exercise of discretion is said
to be an appeal on principle. Appellate Court will not
reassess the material and seek to reach a conclusion
different from the one reached by the Court below solely on
the ground that if it had considered the matter at the trial
stage, it would have come to a contrary conclusion. If the
discretion has been exercised by the trial Court reasonably
and in a judicial manner the fact that the appellate Court
would have taken a different view may not justify
interference with the trial Court’s exercise of discretion {See
Wander Ltd. v. Antox India P. Ltd., 1990 (Supp) SCC 727 :
1990(3) SCC 240 and N. R. Dongre v. Whirlpool
Corporation, 1996 (5) SCC 714) : 1996 AIR SCW 3514
However, the present one is a case falling within the well
accepted exceptions. Neither the trial Court nor the High
Court have kept in view and applied their mind to the
relevant settled principles of law governing the grant or
refusal of interlocutory injunction in trade mark and
trade name disputes. A refusal to grant an injunction in
spite of the availability of facts, which are prima facie
established by overwhelming evidence and material
available on record justifying the grant thereof,
occasion a failure of justice and such injury to the
plaintiff as would not be capable of being undone at a
latter stage. The discretion exercised by the trial Court
and the High Court against the plaintiff, is neither
reasonable nor judicious. The grant of interlocutory
injunction to the plaintiff could not have been refused,
therefore, it becomes obligatory on the part of this Court to
interfere.”
(Emphasis supplied)
36. Thus, this Court is of the view that the Trial Court has
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completely gone in the wrong direction, thereby considering
the status of the power of attorney holder as the defendant,
and answered six issues, which were framed by itself but
decided incorrectly, erroneously, and perversely, thereby
committing a serious error of law, whereby refused the
injunction in favour of the plaintiff, so granted during the
pendency of the injunction application.
37. As such during course of arguments, it has been drawn
attention of learned advocates appearing for Respondent-
defendant about aforesaid facts and aspect of the matter
whereby trial Court has committed a serious error not only in
not appropriately considering the facts but it has also
committed a gross error in law by unnoticed various provisions
of both these Acts. Learned advocates of Respondent-defendant
were unable to satisfy this Court thereby not in a position to
defend the impugned judgement/order albeit, argued on the
points which were either never pressed into service before trial
Court or not satisfactorily recorded in the impugned
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judgement/order. So, in light of said facts and ratio of
aforesaid decisions applied to the case on hand, this Court is
not at all impressed by any of the arguments so canvassed by
learned advocates of Respondent-defendant and recorded herein
above.
38. When the impugned order is erroneous, perverse, and not
in consonance with the provisions of the law, this Court would
be entitled to interfere with such an order by exercising its
power under Order 43 of the CPC, which is otherwise required
to be exercised to protect the right of the plaintiff as per the
provisions of the Trademark Act, 1999 and the Copyright Act,
1957.
CONCLUSION
39. The upshot of the aforesaid discussion, observation, and
findings, as recorded hereinabove, this Court is of the view
that the order impugned in the appeal is erroneous, perverse,
and without appreciating the material particulars available on
record and passed in ignorance of the relevant provisions of
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the Trademark Act, 1999 and the Copyright Act, 1957, as
discussed hereinabove.
40. Thus, in view of the aforesaid, the impugned order
requires to be quashed and set aside, thereby the injunction
application of the plaintiff filed below Exhibit 5 in Trademark
Suit No. 1 of 2024 at Visnagar, Mehsana is held to be allowed
as prayed for by the plaintiff, whereby, injunction so granted
in favour of the plaintiff continued so far will continue till
disposal of the suit.
41. Consequently, the applications filed by the defendant
below Exhibits 11 and 16 in Trademark Suit No. 1 of 2024,
pending before Visnagar at Mehsana are hereby rejected,
subject to as follows.
42. Considering the fact that the goods, which were seized as
per the order of the Trial Court passed below Exhibit 6
through the Court Commissioner are perishable goods, it is
open for the defendant to move an appropriate application for
the disposal of such goods albeit, without affecting the right of
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the plaintiff, thereby it can be permitted to sell such seized
goods without using the brand name “ARJUN” on its selling
pouches. The Trial Court may pass an appropriate order on
such an application on appropriate condition, if so filed by the
defendant, in accordance with the law.
43. In view of the above, the impugned order dated 30 th
December 2024, passed by the 4th Additional District Judge,
Mehsana at Visnagar, below Exhibits 5, 11, and 16 in
Trademark Suit No. 1 of 2024, is hereby quashed and set
aside, and the appeal from order is partly allowed to the
aforesaid extent. No order as to costs. The civil application is
also disposed of accordingly.
Sd/-
(MAULIK J.SHELAT,J)
MOHD MONIS
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