Delhi District Court
Brief Facts Of The Case As Necessary For ... vs M/S Bombay Waterproof Manufacturing ... on 21 August, 2018
IN THE COURT OF ANKUR JAIN
ADDITIONAL DISTRICT JUDGE (CENTRAL) 10: DELHI
TM No. : 21/11
New No. : 1006/16
M/s. STP Limited
707, Chirenjive Tower,
43, Nehru place
New Delhi - 110 019 ....Plaintif
VERSUS
1. M/s. Shalimar Seal & Tar Products Pvt. Ltd.
16/681 Main Faiz Road,
New Delhi - 110005
2. M/s. Shalimar Seal & Tar Products Pvt. Ltd.
B-6, B-7, B-8, Jaipur Tower,
M.I. Road, Jaipur - 302 001 ....Defendants
Date of Institution of suit : 09.12.2011
Reserved for Judgment on : 02.05.2018
Date of Order : 21.08.2018
Suit for Permanent Injunction Restraining
Infringement, Passing Off, Rendition of Accounts and
Damages.
TM no. 21 of 2011 Page no. 1 of 45
J U D G M E N T:-
01. Brief facts of the case as necessary for the disposal of the present suit are that plaintiff is a company incorporated under the Companies Act and working under the name and style of M/s. STP Limited and is engaged in the business of manufacturing, distribution, Sale and trade of waterproofing products, corrosions protection products, constructions chemicals etc. for the last 75 years. It is the case of the plaintiff that their company was conceived in 1935 and was in- operation under the name and style of Shalimar Tar Products subsequently the name was changed to its present name on 09.01.1985. The plaintiff company held strong reputation and goodwill in the market, the plaintiff honestly started using their coined, conceived and distinctive trademark "STP Limited" and other various brand names which were nothing but the products of the plaintiff company. The marks were being used by the plaintiff through out the territory of India, the plaintiff's trademark STP Limited is registered under the Indian Trademarks Act. Since 1935 plaintiff has been working TM no. 21 of 2011 Page no. 2 of 45 under the name and style "SHALIMAR". The plaintiffs' goods are sold, traded and marketed by the plaintiff directly or through its wide network of associates, plaintiff has been spending considerable amount on advertisements, promotions, market research. The annual turn over of the plaintiff is as under:-
S.No. Financial Years Amt/Cr./Rs.
1. 2005-2006 50.28
2. 2006-2007 60.86
3. 2007-2008 82.20
4. 2008-2009 81.08
5. 2009-2010 103.18
6. 2010-2011 143.98
02. Defendant no. 1 and 2 are engaged in the trade of manufacturing and marketing the products similar to those of the plaintiff with deceptively similar brand name, the brand name are not only deceptively similar but their application and the market use is identical. The defendants are running the company in the name and style of "Shalimar Seal & Tar products (P) Ltd." which also leads to misconception in the TM no. 21 of 2011 Page no. 3 of 45 mind of customers that the defendant company is none other than STP Limited. The plaintiff recently found out that the actual name of the defendant company was Capital Steal & Chemical (P) Ltd. and they changed their name in the year 2008. The brand names being used by the defendants are identical with and deceptively similar to the plaintiff's brand names. It is further stated that there may be difference in the packaging, but the confusion pertaining to the phonetic similarity is so high that the consumers are bound to get confused on account of imperfect recollection of spellings. It is further the case of the plaintiff that the plaintiffs are using the word "SHALI" as prefix to its products and the defendants have also started using the same word to deceive the customers and pass off their products to the customers. The plaintiff came to know about the products of the defendant in the month of August, 2011 and hence the present suit was filed seeking permanent injunction and rendition of accounts. The plaintiff had sought amendment of the plaint which was allowed vide order dated 02.01.2013 and amended plain was taken on record.
TM no. 21 of 2011 Page no. 4 of 45
03. Written statement was filed by the defendants in which it is stated that plaintiff is neither the owner, nor the proprietor of the impugned trade mark "SHALIMAR" in relation to its impugned goods and business, because of the plaintiff himself changed his name and style from Shalimar Tar Products limited to STP Limited which shows that plaintiff has waived all his rights in the word "SHALIMAR" in respect of the impugned goods. It is further the case of the defendant that this court does not have territorial jurisdiction to try the present suit. It was further stated that plaintiff has wrongly mention that cause of action arose in the year 2011 as plaintiff was very much aware of the activity of the defendants as they had issued a cease and desist notice on 26.01.1993 and 27.09.1995 which were duly replied by the defendants and therefore the cause of action arose in the said year. The present suit having been filed after 19 years is thus not maintainable. It is the case of the defendant that they had been continuously using the said trade mark from many years and that plaintiff had abandoned the word Shalimar way TM no. 21 of 2011 Page no. 5 of 45 back in 1985 as he had changed the name of the company to STP Limited thereby conveying a message to the public and the trade that the plaintiff is not interested in the word "SHALIMAR". The written statement was amended by the defendant, which was allowed vide order dated 27.07.2013. Subsequently defendant wanted to again amend the written statement and the said prayer was rejected vide order dated 12.04.2016.
04. Replication to the Written statement was filed wherein the contents of the written statement were denied and that of the plaint were reiterated.
05. After completion of pleadings vide order dated 17.01.2015 following issues were framed:-
1. Whether the suit has been properly valued for the purpose of court fee and jurisdiction and sufficient court fee has been affixed on the plaint? OPP.
2. Whether the suit has become barred by limitation or suffers from delay, latches and acquiescence? If so, its effect? OPD.
TM no. 21 of 2011 Page no. 6 of 45
3. Whether this court has the territorial jurisdiction to entertain and try the suit? OPP.
4. Whether the suit has been filed by the plaintiff by suppressing and concealing material facts including the exchange of notices dated 22.01.1993 and 27.09.1995? If so, to what effect? OPP.
5. Whether the change of its trade name by the defendant vide resolution dated 11.04.2008 is malafide and aimed at encashing the reputation and goodwill of plaintiff ? OPP.
6. Whether the defendant has become honest concurrent user of the trade name and house mark Shalimar in relation to their goods and business?
OPD.
7. Whether the plaintiff is entitled to decree of permanent injunction for restraining the defendant from infringing the trade name and trademarks/label Shalimar, STP Ltd. and Shali Prefix? OPP.
8. Whether the defendant has been passing off their identical or deceptively similar goods and business as that of the plaintiff and are liable to be permanently restrained? OPP.
9. Whether the plaintiff is entitled to decree of permanent injunction for restraining the defendant from infringing their copyright in artistic and literary work in the labels? OPP.
10. Whether the plaintiff is entitled to an order of rendition of accounts of profits earned by the defendant by sale of impugned goods and money decree of ascertained profits? OPP.
TM no. 21 of 2011 Page no. 7 of 45 11. Relief.
06. In order to prove its case plaintiff has examined Jai Prakash Kukreja as PW1 who has proved the original resolution passed by the Board of Directors, Incorporation Certificate dated 07.11.1935 which was exhibited as Ex. PW1/3, Fresh Certificate of Incorporation dated 16.01.1985 which was exhibited as Ex. PW1/4, Advertisement promotion material as Ex.PW1/5, documents showing continuous use of the trademark "Shalimar" even after the change of the name to STP Limited are exhibited as Ex. PW1/6, documents showing adoption and use of trademark "SHALITEXT" & "SHALIBOND"
as Ex. PW1/7, various trademark Registration & Renewal Certificates as Ex. PW1/8, Sales Invoices showing long standing use of trademark as Ex. PW1/10, Sales Figure as Ex.PW1/11, notice dated 03.09.2011 as Ex.PW1/13, copy of letter received by the plaintiff as Ex.PW1/15.
07. PW-2 was Sh. D.N. Tiwari who was working as TM no. 21 of 2011 Page no. 8 of 45 Manager Sales in the plaintiff company and relied upon the already exhibited documents.
08. PW-3 Sh. Nebulal Khatick who was from the office of Trade Mark Registry, Kolkatta and produced the record of trademark registered in favour of M/s. STP Limited.
09. PW-4 Vinay Kumar, who was from the office of Trade Mark Registry, Delhi and who produced the record of trademark registered in favour M/s. STP Limited. Thereafter plaintiff's evidence was closed. In defence, defendants have examined Uttam Kumar Dundlodia as DW1 who relied upon the Board Resolution, Certificate of Incorporation as DW1/2. The Certified Statement of Chartered Accountant regarding the sales turn over as Ex. DW1/3, application by the defendant with respect to the trademark 'Shalimar' as DW1/5, Advertisement bills, Promotion material as Ex. DW1/13, Sales invoices as Ex. DW1/14 and various documents. DE was closed vide order dated 24.07.2017.
TM no. 21 of 2011 Page no. 9 of 45 10. Ld. counsel for the plaintiff has argued that since
inception plaintiff is using the trademark "SHALIMAR" for its goods which is long standing uninterrupted and continuous. He has argued that plaintiff is the first adopter of the trademark "SHALIMAR" which being an obvious Arbitrary trademark as it has no connection with the goods, therefore, it is entitled to the highest degree of protection. The plaintiff for the first time in the year 1953 coined and adopted a "SHALI" prefix trademark and similarly adopted numerous other marks bearing the prefix "SHALI". On the other hand Ld. Counsel for the defendant has argued that plaintiff has acquiescence his trademark as the plaintiff was aware of the activity of defendant since 1993 which clearly indicates that there was an implied consent by the plaintiff to the use of defendant's trademark. It is further argued that there is a delay and laches in filing the suit. It was next contended that defendant is the honest, concurrent and prior user of trademark "SHALIMAR" & "SHALI" prefix trademark. It was lastly argued that the name is common to the trade and that the plaintiff is not using the mark "SHALIMAR" & "SHALI TM no. 21 of 2011 Page no. 10 of 45 PLAST". The defendant has built goodwill and reputation and that there is no similarity between the trademark of the plaintiff and that of the defendant.
11. I have heard Ld. Counsel for the parties and perused the record. My issues wise findings are as under:-
Issue no. 1 :-
Whether the suit has been properly valued for the purpose of court fee and jurisdiction and sufficient court fee has been affixed on the plaint? OPP.
12. The onus to prove this issue is upon the plaintiff. As per Para 41 of the amended plaint, plaintiff has valued the suit for the purpose of court fee and jurisdiction and a total court fee of Rs. 20,200/- has been paid. In the amened written statement so filed there is no objection by the defendant that appropriate court fee has not been paid. In the written statement in reply to para 41 it is simply stated that the suit has not been properly valued without stating anything more. In the written submissions also there is no real challenge to TM no. 21 of 2011 Page no. 11 of 45 the fact that the court fee has not been paid. In any case plaintiff can be directed to furnish more court fees in case the suit of the plaintiff is decreed and the amount of damages so awarded is more than Rs. 18,00,000/-. Accordingly, this issue is decided in favour of the plaintiff and against the defendant.
13. Issue no. 2 Whether the suit has become barred by limitation or suffers from delay, laches and acquiescence? If so, its effect? OPD.
Onus to prove this issues is upon the defendant. Ld. Counsel for the plaintiff has argued that there is no period of limitation in trade mark case and has relied upon the judgment of Hon'ble SC in M/s. Bengal Water Proof Ltd. Vs. M/s Bombay Waterproof Manufacturing Co. 1997 PTC 17, M/s Hindustan Pencils Pvt. Ltd. vs. M/s India Stationery Products Co. AIR 1990 Delhi 19 and Swaran Singh Trading as Appliances Emporium vs. Usha Industries (India) & Anr. 1986(6) PTC, 287 (Del) (DB). On the other hand Ld. Counsel for the defendant has argued TM no. 21 of 2011 Page no. 12 of 45 that plaintiff was aware of the activities of the defendant and had issued notice to the defendant but did not take any action because of which the principle of acquiescence would apply and has placed reliance on the judgment of M/s Power Control Appliances & Ors. Vs. Sumeet Machines Pvt. Ltd. 1995 PTC 165 Rhizome Distilleries Pvt. Ltd. vs. Pernod Ricard S.A. France & Ors. 2010 42 PTC 806, Delhi DB.
14. The Hon'ble Supreme Court in M/s Bengal Waterproof Ltd. (Supra) has held that:-
"Similarly whenever and wherever a person commits breach of a registered trade mark of another he commits a recurring act of breach or infringement of such trade mark giving a recurring and fresh cause of action at each time of such infringement to the party aggrieved."
15. The above said judgment was relied upon by the Hon'ble Delhi High Court in Banyan Tree Holdings Pvt. Ltd.
TM no. 21 of 2011 Page no. 13 of 45 vs. Mr. Jamshyad Sethna & Anr. 2016 (2) R.A.J. 755 (Del) and had held that in case of continuing breach of contract or in the case of a continuing tort a fresh period of limitation begins to run at every movement of the time during which the breach or the tort, as the case may be, continues.
16. Thus, in view of the clear authoritative pronouncement it cannot be said that the suit of the plaintiff is liable to be dismissed on the ground of limitation alone as every time the infringed product is sold it gives a fresh cause of action in favour of the plaintiff.
17. Now coming to the question whether there are delay, laches or acquiescence. The Hon'ble SC in Power Control Appliances Case (Supra) has observed that delay simplicitor is no defence for infringement of the trademark.
18. The Hon'ble Supreme Court in para 29 of the said judgment has held that acquiescence is sitting by, when another is invading the rights and spending money on it. It is TM no. 21 of 2011 Page no. 14 of 45 a course of conduct inconsistent with the claim for exclusive rights in a trade mark, trade name. It implies positive act; not merely silence or inaction such as is involved in laches.
19. In case of Swarn Singh Trading (Supra), it was held that:
"Delay in matter of applying for injunction in some cases could be fatal. However, while dealing with a statutory right, delay itself did not destroy the right to apply for injunction. An exclusive right to use registered trademark cannot be reduced to a nullity".
20. The Hon'ble Delhi High Court in Toyota Jidosha Kabushiki Kaisha Vs. Deepak Mangal & Ors. 2016 (ISB) DRJ 698 in para 186 has held that:-
"Normally, thumb rule is that plaintiff must file an action as early as possible whenever infringement is noticed by the plaintiff whose legal right are violated. The defence of laches or inordinate delay is a defence in equity. An TM no. 21 of 2011 Page no. 15 of 45 equitable defence can be put by a party who has acted fairly and honestly.
21. In M/s. Hindustan Pencils Ltd. (Supra) it was held that:
"Even though there may be some doubt as to whether laches or acquiescence can deny the relief of a permanent injunction, it has been consistently held that if the defendant acts fraudulently with the knowledge that he is violating the plaintiff's rights then in that case, even if there is an inordinate delay on the part of the plaintiff in taking action against the defendant, the relief of injunction is not denied".
22. It was further observed that :
"Inordinate delay or laches may be there because the plaintiff may not be aware of the infringement by the defendant or the plaintiff may consider such infringement by the defendant as not being serious enough to hurt the plaintiff's business".
23. It was further observed that :
"Where the plaintiff, however, is guilty of TM no. 21 of 2011 Page no. 16 of 45 acquiescence, there different consideration may apply. Acquiescence may be a good defence even to the grant of a permanent injunction because the defendant may legitimately contend that the encouragement of the plaintiff to the defendant's use of the mark in effect amounted to the abandonment by the plaintiff to his right in favour of the defendant and, over a period of time, the general public has accepted the goods of the defendant resulting in increase of its sale".
24. In M/s. Hindustan Pencils (Supra) the concept of laches was also explained and according to the said judgment delay coupled with prejudice would amount to 'laches'. The court further observed that "laches" and "inordinate delay"
are not similar to "acquiescence" and quoted with approval the observation made in Willmott Vs. Barbar, 1880 15 Ch.D.96 wherein it was held that: In the first place the plaintiff must have made a mistake as to his legal rights. Secondly, the plaintiff must have expended some money or must have done some act on the faith of his mistaken belief. Thirdly, the defendant, the possessor of the legal right, must TM no. 21 of 2011 Page no. 17 of 45 know of the existence of his own right which is inconsistent with the right claimed by the plaintiff. If he does not know if he is in the same position as the plaintiff, and the doctrine of acquiescence is founded upon conduct with a knowledge of your legal rights. Fourthly the defendant, the possessor of the legal right, must know of the plaintiff mistaken belief and his rights and lastly, the defendant, must have encouraged the plaintiff in his expenditure of money or in the other acts which he has done, either directly or by abstaining from asserting his legal rights. In reading that passage, it is perhaps necessary to note that the position of plaintiff and the defendant as they are usually met with are to be transposed.
25. What emerges from the law laid down in these cases is that mere delay and laches is not a ground for refusal to grant injunction. Secondly acquiescence is not similar to delay and laches. Thirdly, it the possessor of legal right does not chose to take any legal action against the violator. Then it would amount to abandonment of his right in favour of the opposite party and thus the principles of acquiescence would TM no. 21 of 2011 Page no. 18 of 45 apply.
26. Applying these principle of law, to the facts of the present case. DW-1 in his cross examination has admitted that he knew about the existence of plaintiff company. Thus if the issue was only of delay and laches, then injunction could have been granted in favour of the plaintiff and defendant could have been restrained. However in the present case, defendant has also set up a defence of acquiescence. The defendant would thus have to show that despite plaintiff being aware of his legal right, he did not take any action and encouraged the defendant either directly or by abstaining from asserting his legal right. There is nothing on record to suggest that plaintiff had encouraged the defendant directly where it can be said that he had abandoned his right. However, the plaintiff had indirectly encouraged the defendant. On 22.01.1993 and on 29.09.1995, plaintiff had issued a cease and desist notice which were exhibited as Ex.DW1/11 which was duly replied by the defendant. Perusal of both these notices would show that plaintiff wanted the defendant to stop TM no. 21 of 2011 Page no. 19 of 45 using the trademark "Shalimar". The plaintiff chose to remain silent thereafter and chose not to take any action against the defendant. Thus, plaintiff was aware of his legal rights but chose not to take any action. This clearly shows that plaintiff had indirectly encouraged the defendant for using its mark. In the present case it is not a case of delay of about 1 or 2 years but of about two decades, plaintiff remained in deep slumber . Plaintiff had allowed the defendant to grow its business by leaps and bound. The sales figures of the defendant company has been reproduced in para 5 of the affidavit Ex. DW1/A. The Certificate of its Chartered Accountant was exhibited as Ex. DW1/3. The sales figures was around Rs. 17,81,396/- in the year 1993-1994 which had increased to Rs. 16,38,46,612/-. Plaintiff stood by silently and did not take any action. It does not lie in the mouth of the plaintiff to say that they were not aware of their rights. Plaintiff was fully conscious of its right as it had got issued cease and desist notice but despite that allowed the business of the defendant to grow for almost two decades. Then surely the principles of acquiescence would apply.
TM no. 21 of 2011 Page no. 20 of 45
27. In Mc Caw Steveson & Ors. Ltd. Vs. Lee Bros. (1960) 23 RPC 1 acquiescence for four years was held to be sufficient to preclude the plaintiff from succeeding. The said judgment was quoted with approval in the judgment of Power Control Appliances & Ors. (Supra). In case of Clueltt, Peabody & Co. V/s. Mc Intyre, Hogg Marsh & Co. 1958 RPC 35, injunction was not granted because the plaintiff had approached the court after nearly 30 years. The said judgment was quoted with approval in M/s. Hindustan Pencils Pvt. Ltd. The issue in so far as it relates to acquiescence is concerned in respect of trademark "Shalimar" is concerned the same is decided in favour of the the defendant, and against the plaintiff.
28. In so far as "Shali" prefixed trademark is concerned the defendant cannot be allowed to agitate the same. In fact an application was filed by the defendant for amending the written statement and incorporating the facts with respect to Shali Prefixed trademark. However, the same was dismissed TM no. 21 of 2011 Page no. 21 of 45 and the order was never challenged by the defendant. Thus it attained finality. Moreover DW1 in his cross examination conducted on 29.11.2006 has admitted that in reply to the legal notice dated 10.05.2011, defendant did not claim rights in "Shali" prefix trademark.
29. Issue no. 3:-
Whether this court has the territorial jurisdiction to entertain and try the suit? OPP.
30. The onus to prove this issue is upon the plaintiff. It is the case of the defendant this court has does not have any territorial jurisdiction as no part of cause of action has arisen within the territorial jurisdiction of this court as the defendants are based in Jaipur and they are not based in Delhi and neither the plaintiff nor the defendant carries on their business within the territorial jurisdiction of this court. As per Section 134(2) of the Trademarks Act 1999 for the purpose of clause (a) & (b) of Sub Section (1) a district court, not with standing the provisions of CPC would mean the district, within TM no. 21 of 2011 Page no. 22 of 45 whose jurisdiction, the person instituting the suit or proceedings resides.
TM no. 21 of 2011 Page no. 23 of 45
31. The plaintiff is admittedly based in Delhi and is carrying on his business within the jurisdiction of this court. Therefore, as per the provisions of Section 134 (2) of Trade Mark Act, 1999 it cannot be said that this court does not have the territorial jurisdiction. Even otherwise, DW-1 in his cross examination conducted on 02.02.2017 has stated that plaintiff has an office in Delhi and since they have an office in Delhi they must be selling the goods in Delhi. He has further stated that defendant does not have an office in Delhi at present but earlier they had an office in Karol Bagh. He could not recollect till what time the office of defendant in Delhi was operational. However, he categorically admitted that they sold their products in Delhi. He also admitted that in reply to Legal notice which was dated 05.10.2011. It is mentioned that defendants are having an office in Jaipur and Delhi. In view of the categorical admission of DW1 it cannot be said that this court does not have the territorial jurisdiction to entertain and try the suit. Hence, this issue is accordingly decided in favour of the plaintiff and against the defendant.
TM no. 21 of 2011 Page no. 24 of 45 32. Issue no. 4:-
Whether the suit has been filed by the plaintiff by suppressing and concealing material facts including the exchange of notices dated 22.01.1993 and 27.09.1995? If so, to what effect? OPP.
The onus to prove this issue is upon the plaintiff. The Hon'ble Supreme Court in Arunima Baruah Vs. Union of India (2007) 6 SCC 120 has held that :-
"It is trite law that so as to enable the court to refuse to exercise its discretionary jurisdiction suppression must be of material fact. What would be a material fact, suppression whereof would dis-entitle the appellant to obtain a discretionary relief, would depend upon the facts and circumstances of each case. Material fact would mean material for the purpose of determination of the lis, the logical corollary whereof would be that whether the same was material for grant or denial of the relief. If the facts suppressed is not material for determination of the lis between the parties, the court may not refuse to exercise its discretionary jurisdiction. It is also trite that a TM no. 21 of 2011 Page no. 25 of 45 person invoking the discretionary jurisdiction of the court cannot be allowed to approach it with dirty hands. But even if the said dirt is removed and the hands become clean, whether the relief would still be denied is the question.
33. What emerges from this judgment is that ordinarily the court may refuse to exercise its discretionary jurisdiction if the party has suppressed material fats. The fact so suppressed should be material. The court may still grant injunction if it is of the opinion that the fact so suppressed is not material to decide the lis.
34. In the present case plaintiff has not disclosed the cease and desist notice dated 22.01.1993 and 27.09.1995. The bare perusal of those notices Ex. DW1/11 shows that it was case of the plaintiff in the said notice that plaintiffs are the registered proprietor of the trademark "SHALIMAR" and the defendants should stop using the same. The said notices were duly replied by the defendant. Despite issuance of these notice, plaintiff has not placed on record these notices. In TM no. 21 of 2011 Page no. 26 of 45 para 37 of the amended plaint it has been stated that plaintiff came to know about the adoption in the last week of August, 2011 which is a factually incorrect statement, as the plaintiff was aware of the business of the defendant at least from 1993, if not prior, both these notices are material fact as the cause of action has been wrongly to have arisen in 2011, whereas the plaintiff was well aware about the existence of the defendant company much prior. Hence, plaintiff is guilty of concealing and suppressing material facts in so far as trademark "Shalimar" is concerned. It has wrongly stated about the cause of action, which goes to the root of the matter in so far as the relief of injunction qua the trademark "Shalimar" is concerned. In so far as "Shali" prefixed trademarks are concerned, there is no concealment or suppression of material facts.
35. Issue no. 5:-
Whether the change of its trade name by the defendant vide resolution dated 11.04.2008 is malafide and aimed at encashing the reputation and goodwill of plaintiff ? OPP.
TM no. 21 of 2011 Page no. 27 of 45
The onus to prove this issue is upon the plaintiff. It
is the case of the plaintiff that he had changed the name of the company from Shalimar Tar Product to STP Limited in the year 1985 and the defendants change the name of the company from Capital Steel and Chemical Private Ltd. to "Shalimar Seal and Tar Products Pvt. Ltd." vide resolution dated 11.04.2008. The reason given in the cross examination is that the defendant had another company by the said name which does not appear to be cogent and convincing. No document has been placed on record by the defendant to prove this. In his cross examination dated 24.07.2017 he says that he does not remember when the expression SSTP was adopted which is clearly an evasive answer given by the defendant. He denied the suggestion that STP and SSTP are deceptively similar. He had also admitted in his cross examination conducted on 02.02.2017 that people sometime ask them if they are concerned with the plaintiff. Therefore, from the cross examination it clearly stands established that defendant had changed the name of its company only to encash the goodwill of the plaintiff. Both the names "STP"
TM no. 21 of 2011 Page no. 28 of 45 and "SSTP" not only have visual resemblance but also have phonetic similarity. Accordingly, this issue is decided in favour of the plaintiff and against the defendant.
36. Issue no. 6:-
Whether the defendant has become honest concurrent user of the trade name and house mark Shalimar in relation to their goods and business?
OPD.
37. The onus to prove this issue is upon the defendant.
Defendant in his cross examination has admitted that it was aware of the plaintiff's trademark prior to its adoption by the defendant. DW-1 has also admitted that plaintiff has been in the business under the name/trademark Shalimar prior to the defendant, he also admitted that plaintiff has been into the business under the Shali prefixed trademarks prior to the defendant. He also admitted in his cross examination that substantial product of the plaintiff and defendant are similar. DW1 in his cross examination has clearly admitted that they were aware of the plaintiff and its trademark when they had adopted the trademark "Shalimar" and other "Shali" prefixed TM no. 21 of 2011 Page no. 29 of 45 trademark. When the defendant himself admitted that plaintiff was the prior user, therefore, no question arises that he can became an honest concurrent user.
38. Plaintiff has relied upon invoices which have been exhibited as Ex.PW1/10 (colly). The first invoice on record which shows that plaintiff is using the prefix "Shali" on its product is dated 27.03.1968, when it had sold "Shalitex Primer". There is another invoice dated 31.03.1992 which shows that prefix "Shali" was used for product "Shalikote". There are other bills which shows that plaintiff has been continuously using "Shali" prefix trademarks for its different product. Plaintiff has also proved on record various trademark with a prefix "Shali" for which registration has been granted in his favour. No objection was taken by the defendant regarding mode of proof of these invoices and hence they are admissible in evidence. In this regard reliance can be placed on the judgment of R.V. E Venkatachala Gounder V. Arulmigu Visweswami & V. P. Temple 2003 (8) SCC 752. The certificates were exhibited as Ex. PW1/8. On the contrary TM no. 21 of 2011 Page no. 30 of 45 defendant has relied upon sale invoices which were exhibited as Ex. DW1/14 which are of the year 1999 which was in respect of Shalimar Cement. So on the basis of the bills placed on record, it is clearly established that plaintiff was not only the prior user of "Shali" prefix trademark but also had a registration in his favour. In no manner defendant can be said to be an honest concurrent user. Accordingly, this issue is decided in favour of the plaintiff and against the defendant.
39. Issues no. 7 :-
Whether the plaintiff is entitled to decree of permanent injunction for restraining the defendant from infringing the trade name and trademarks/label Shalimar, STP Ltd. and Shali Prefix? OPP. The onus to prove this issue is on the plaintiff. In Ramdev Food Products Pvt. Ltd. Vs. Arvind Bhai Ram Bhai Patel(2006) 8SCC 736. It was held that defence of acquiescence could be upheld if the Proprietor assents to or stands by in relation to acts by another person.
40. In the present case defendant, the alleged infringer TM no. 21 of 2011 Page no. 31 of 45 had built up trade with the specific knowledge of the proprietor, the prejudice suffered by the defendant would be relevant factor and would be one of the grounds for denial of injunction.
41. In the facts and circumstances of the present case, defendant cannot be said to be honest concurrent user, however at the same time it is also to be seen that defendant has been able to prove acquiescence by the plaintiff with respect to mark "Shalimar". The plaintiff has not come to the court with clean hands so, if both these things are weighed together, it is clear that plaintiff has not been an honest party and nor a diligent litigant in so far as the trademark "Shalimar" is concerned. The maximum vigilantivus non dormientibus Suppetit (if you want law to help, you must keep awake) comes to the aid of the defendant not directly but indirectly. In view of my findings on issue no. 2 plaintiff is not entitled to decree of permanent injunction as there has been a delay of about 19 years so far as the trademark "Shalimar" is concerned the business of the defendant cannot TM no. 21 of 2011 Page no. 32 of 45 be directed to be shut down. Plaintiff stood by knowingly and allowed the defendant to build up their trade and acquiescence his right qua the trademark "Shalimar". Even though defendant was not an honest user.
42. A proprietor of registered trademark is entitled to statutory rights and on infringement of his rights, he can initiate appropriate action. The defendant can defend himself on the basis of statutory defences available to him under the act, specially under Section 30, apart from common law defences. However, where the plaintiff has laid by and inspite of his right and by his conduct encouraged the defendant to alter his condition then plaintiff cannot claim injunction. It is the case of the plaintiff that defendants are using brand names on its product which are similar to or are deceptively similar to the brand names owned by the plaintiff in respect of "Shali" prefixed trademark. The plaintiff in its plaint has given a comparative chart which is being reproduced as under:-
TM no. 21 of 2011 Page no. 33 of 45
TM no. 21 of 2011 Page no. 34 of 45
COMPARISON CHART
Product name of the Description of the Company's Impugned Product
plaintiff plaintiff product Registered by the Name (Defendant
plaintiff product)
Shali Plus APP Modified
Membrane with 20
micron HMHDEP
Core
Superior ShaliPlus APP Modified ShaliPlus SHALIMAR PLUS
Membrane with
100 micron
HDHDEP Core
ShaliPlast HP High Range Water
Reducing
Plasticizer
ShaliPlast SP High Range Water ShaliPlast SHALIPLAS
Reducing Cum
Retarding
Admixture
ShaliRust Off Chloride/Sulphate ShaliRustOff SHALIMAR RUST
Free Liquid Rust REMOVER
Remover
ShaliPoxy AR Two Component ShaliPoxy
Acid Resistant
Epoxy Floor
Coating
TM no. 21 of 2011 Page no. 35 of 45
ShaliPoxy WB Two Components ShaliPoxy WB
Water Based Epoxy
For Floor/Wall
Coating
ShaliPoxy WC LB Two Components ShaliPoxy
Solvent Based
Epoxy Wall SHALIMAR
CoatingLow Build EPOXY FLOOR
COAT
ShaliPoxy MIO Two Component ShaliPoxy
Polyamide Epoxy
Intermediate Anti
Corrosive Coat
ShaliPoxy PS Two Component ShaliPoxy
Polysulphide
Modified Epoxy
Coating
ShaliPoxy PUTTY Three Component ShaliPoxy
Epoxy Putty
ShaliPoxy SLC Solvent Free Epoxy ShaliPoxy
Floor Coating
Air Entraining Shali Plast SHALIPLAS
Shali Plast AB Admixture for
Concrete
Shali Plast HP High Range Water Shali Plast
Reducing
Plasticizer
Shali Plast P Water Reducing Shali Plast
Admixure
Shali Plast R Set Retarding Shali Plast
Admixture
Shali Plast Liquid Set Shali Plast
Shotcrete L accelerating and
Shortcreting
Admixture
TM no. 21 of 2011 Page no. 36 of 45
Shali Plast Powder Set Shali Plast
Shotcrete P Accelerating and
shotcreting
Admixture
Shali Plast SP High Range Water Shali Plast
Reducing cum
Retarding
Admixture
Shali Plast FS Accelerator for Shali Plast
Concrete
Shali Plast PCE High Performance Shali Plast
Superplasticiser
Shali Grout 50 Single Component Shali Grout
Free Flow Non
Shrink High
Strength/Fluidity
Grout
Shali Grout 6S Single Component Shali Grout
Free Flow Non
Shrink High
Strength/Fluidity
Grout
Shali Grout Anchor Two Component Shali Grout
Polyester Resin
Based Anchor
Grout
Shali Grout EI Two Component Shali Grout
Epoxy Injection
Grout for Structural
Stengthening
Shali Grout EP P Three Component Shali Grout
Epoxy Grout for
Vibratory/Heavy
Equipment Bases
Shali Grout EP R Three Component Shali Grout
TM no. 21 of 2011 Page no. 37 of 45
Epoxy Grout
System for
Equipment Bases
Shali Grout IP Single Component Shali Grout
Grout for
Cement/Mortar/Co
ncrete
Shali Poxy Kota Three Component Shali Poxy
Grout Epoxy Based Kota
Sone/Tile Joint
Filler
Shali Poxy Tile Three Component Shali Poxy
Grout Epoxy Bases Tile
Joint Filler
Shali Tile Glue Fast Setting Dry Set Shali Tile
tile Adhesive
Mortar
Shali Tile Grout Single Component Shali Tile
Gap Filling
material between
Tiles
Shali Cure Acrylate Arylic Curing & Shali Cure Shalicurex (AC)
Sealing Conpound
Shali Cure PA Paraffin Based Shali Cure Shalicurex
Concrete Curing
Compound
43. Broadly the Shali prefix trademark can be divided into 3 categories for which infringement is being alleged as per the comparison chart. Firstly "Shali Plast" secondly "Shali Poxy" thridly "Shali Grout" and lastly "Shali Cure". I shall TM no. 21 of 2011 Page no. 38 of 45 examine the mark one by one. The first trademark is "Shali Plast" which the plaintiff is using, the defendant according to the comparison chart is using "SHALIPLAS". In the evidence by way of affidavit PW-1 has exhibited various registration. The perusal of the same shows that "Shali GROUT 50", "Shali Plus", "Shali Bond BS/CS", "Shalicure" and "Shali Poxy" are registered in the name of the plaintiff apart from other "Shali" prefixed trademark. Perusal of Ex. PW3/1A shows that trademark "Shali Plast" is duly registered with Registrar of Trademark. It cannot be disputed that there is a phonetic similarity between the trademark of the plaintiff is "Shali Plast" and the one which is being used by the defendant is "SHALI PLAS". There is also no dispute that the market and the customer base is same. The first legible invoice of the plaintiff on record with respect to mark Shali Plast is to one M/s. Mukesh Enterprises and the same is of dated 24.08.2003. There are two more bills, which shows that stock has been transferred from Goa to Delhi and from Goa to Bangalore which are prior to 2003. However, the first invoice of the defendant with respect to the trademark "Shali Plas"
TM no. 21 of 2011 Page no. 39 of 45 is of 03.06.2006. Thus, the plaintiff is not only the registered proprietor but also a prior user of the trademark "Shali Plast".
44. In so far as the trademark Shali poxy is concerned, the plaintiff is the registered proprietor as this trademark is registered vide Ex. PW3/19A, Ex. PW3/27A. However, the defendant is using 'Shalimar Epoxy" on its product, since the defendant is using Shalimar Epoxy, he cannot be retained as I have already held that plaintiff had acquiescence his rights in respect of the trademark "Shalimar" and "Poxy" is the generic name derived from the chemical used in the product.
45. In so far as "Shali Grout" is concerned, the plaintiff is the registered proprietor and there is no bill on record which could show that defendant was using the same prior to that of the plaintiff whereas the first legible bill on record filed by the plaintiff is of dated 31.08.2006. Similarly the plaintiff is the registered proprietor of trademark "Shalicure" and the first bill of the defendant is of 16.07.2010. Whereas plaintiff has TM no. 21 of 2011 Page no. 40 of 45 not placed on record any bill with respect to the said trademark. Therefore, it cannot be said that plaintiff is a prior user. However, the word "Shali" has no connection with the products and the defendant is not an Honest Concurrent user. The word "Shali" is an arbitrary word. The wordmark "Shali" is not a generic word either and therefore, needs to be granted highest degree of protection. Therefore, even if no bill in respect of trademark "Shali Cure" has been placed on record still the plaintiff would be entitled to injunction.
46. In view of the above findings, the plaintiff is entitled to injunction in so far as Shali prefixed trademark are concerned except "Shalimar".
47. Issue no. 8:-
Whether the defendant has been passing off their identical or deceptively similar goods and business as that of the plaintiff and are liable to be permanently restrained? OPP.
DW-1 in his cross-examination has admitted that not TM no. 21 of 2011 Page no. 41 of 45 all but substantial products of plaintiff and defendant are similar. He has also admitted in the cross examination that people sometimes ask him if they are connected with the plaintiff. So this is not a case of likelihood of confusion but of actual confusion. Certainly this amount to passing off and on such the defendant is liable to be retained in respect of Shali prefixed trademark.
48. Issue no. 9:-
Whether the plaintiff is entitled to decree of permanent injunction for restraining the defendant from infringing their copyright in artistic and literary work in the labels? OPP.
No evidence has been led by the plaintiff to prove this issue. Therefore, issue is decided against the plaintiff and in favour of the defendant.
49. Issue no. 10:-
Whether the plaintiff is entitled to an order of rendition of accounts of profits earned by the defendant by sale of impugned goods and money decree of ascertained profits? OPP.
The onus to prove this issue was upon the plaintiff.
TM no. 21 of 2011 Page no. 42 of 45 In so far as rendition of accounts and damages is concerned. The Hon'ble High Court in Jockey International V. R. Chandramohan 2014 211 DLT 75 in Para 43 has observed that:
"Damages in such cases must be awarded and the defendants, who chooses to stay way from the proceedings of the court should not be permitted to enjoy the benefits of evasion of court proceedings. Any view to the contrary would result in a situation where a defendant who appears in the court and submits its account books would be liable for damages, while another defendant who, chooses to shy away from court proceedings would escape the liability on account of failure of the availability of account books. A party who chooses not to participate in the court proceedings and stays away, must, thus, suffer the consequences of damages."
50. A similar view was taken by the Hon'ble High Court in "World Wrestling Entertainment Inc. Vs M/s Reshma Collection & Ors." 2017 (70) P.T.C. 550. In view of the aforesaid judgment under the given facts and circumstances TM no. 21 of 2011 Page no. 43 of 45 of the case, the defendants cannot be allowed to enjoy the benefits as he has been selling the goods and is infringing the plaintiff's trademark. Defendants thus are liable to pay punitive damages to the plaintiff.
51. Vide order dated 01.02.2016, the Hon'ble Delhi High Court had directed the defendant to file statement of account in respect of trade mark "Shali Plast" on monthly basis but only statement with respect to month of February and March, 2016 were filed by the defendant. The perusal of the same shows that in the month of March, 2016 the sale was Rs.23,08,402/- and in the month of March, 2016 the sale was Rs. 69,45,196/-. The defendant did not file sale figure for subsequent period and thus violated order passed by the Hon'ble High Court of Delhi. Hence, considering the facts and circumstances of the case, plaintiff is entitled a sum of Rs. 12,50,000/- on account of rendition of accounts of profits earned and Rs. 12,50,000/- as punitive damages.
52. Issue no. 11:
Relief.
TM no. 21 of 2011 Page no. 44 of 45 In view of my findings on issues no. 2 & 7, the suit of the plaintiff is partly decreed in as much as the defendants, its agents, or assignees are restrained from using "SHALI" prefixed trademark in any manner. So far as trademark "Shalimar" is concerned plaintiff has acquiescence his rights in favour of the defendant. The defendant is granted three months' time to dispose off the existing stock with respect to "Shali" prefixed trademark. The defendant is also liable to pay a sum of Rs.12,50,000/- on account of rendition of accounts and Rs.12,50,000/- on account of punitive damages. The amount be paid within a period of 12 weeks failing which interest @10% p.a. shall be charged from the date of judgment till the date of payment. Subject to deposit of additional court fee d ecree sheet be accordingly prepared.
No order as to cost.
File be consigned to record room.
Announced in the open court Digitally signed on 21st August, 2018.
ANKUR by ANKUR JAIN
JAIN Date: 2018.08.24
15:10:35 +0530
(Ankur Jain)
Addl. District Judge (Central)-10
Delhi
TM no. 21 of 2011 Page no. 45 of 45