Delhi District Court
Altab Hossain vs M/S. Hawrah Super Biri No. 202 on 30 October, 2018
IN THE COURT OF SH. ANKUR JAIN: ADDL. DISTRICT JUDGE-10
(CENTRAL): DELHI.
TM no. : 57/10
New No. : 936/16
Altab Hossain
M/s. Jahangir Biri Factory,
Village Khidipur, P.O. Chhabghati,
Aurangabad, Distt. Murshidabad
(West Bengal) ....Plaintiff
VERSUS
1. M/s. Hawrah Super Biri No. 202
Mfg. by Super Biri No. 202,
village Natun Bazar (Khari-bona)
P.O. Dhullian, P.S. Shamsherganj
Distt. Murshidabad,
West Bengal- 742 202
2. Dildar Hossain
Dharampura Gali no. 3,
Mokam No. 30677
Gandhi Nagar, Delhi - 110 031
3. Re. Nijamuddin SK/Dildar Hossain
Prop. M/s. Howrah Biri No. 202
Mfg. by Super Biri No. 202,
village Natun Bazar (Khari-bona)
P.O. Dhullian, P.S. Shamsherganj
Distt. Murshidabad,
West Bengal- 742 202 ......Defendants
Suit instituted on : 04.07.1997
Reserved for order : 07.09.2018
Order announced on : 30.10.2018
TM no. : 57 of 2010 Page no. 1 of 41
Suit for Perpetual Injunction, restraining the defendants from
infringing plaintiff's registered trademark, copyright piracy of
trademark, passing off, rendition of accounts etc.
J U D G M E N T:-
01. Brief facts of the case are that Sh. Altab Hossain claims himself to be the proprietor of M/s Jahangir Biri Factory and had been carrying on the business of manufacturing and marketing of Biris since 25.08.1995 and adopted the trademark "Howrah Biri" (label) in the year 1994 and has been using the mark since 1995. It is the case of the plaintiff that he had applied for registration in the year 1996 in Class-34 vide registration no. 736949 and had given vide publicity to its trademark. On account of Superior quality of the goods and due to continuous use of the trademark and distinctive wrapper for the last several years the plaintiff's trademark had acquired unique reputation and goodwill in public. It was further the case that defendants has also adopted similar trademark having identical colour scheme, get up; lay out, writing style and arrangement as of plaintiff's wrapper which not only amounts to infringement of copyright and trademark but also amounts to passing off. Hence, the present suit was filed. Subsequently, the plaint was amended in as much as para 3 of the original plaint was amended as per the amended plaint, the plaintiff TM no. : 57 of 2010 Page no. 2 of 41 applied for the registration of the mark and on 24.11.2005 vide registration no. 1401112. The Trademark/Label of the plaintiff was registered with the registrar of the Trademark. Written statement along with counter claim was filed wherein it was pleaded that Dildar Hossain is the sole proprietor of defendant and is the proprietor of the trademark "Howrah Super Biri" (label) in respect of biris. The trademark was adopted in the year 1995 and since then it has been used by the defendant extensively and continuously. The defendant applied for registration on 30.10.1996.
02. The counter claim was filed inter-alia claimed that plaintiff should be restrained from using the trademark or passing of the goods as the trademark is similar to the trademark of the defendant.
03. Written statement was filed by the plaintiff to the counter claim of the defendant wherein it was categorically denied that defendant is not the prior user of wrapper Howrah Biri no. 202 and in fact plaintiff has got the wrapper designed by one of its artist under the trademark Howrah Biri no. 102. The first sale of the biri under the trademark Howrah in an artistic wrapper was made on 07.10.1995.
04. Subsequently the defendants had amended their written TM no. : 57 of 2010 Page no. 3 of 41 statement and incorporated the fact that their trademark Howrah Super Biri has been registered in Class-32 vide application no. 1760000.
05. After completion of pleadings vide order dated 05.02.2001 issues were framed:-
1. Whether the suit has been properly signed, verified and instituted by the plaintiff? OPP.
2. Whether the counter claim has been properly signed, verified and instituted by the defendants? OPP.
3. Who is the proprietor and prior user of the mark Howrah Biri and copyright in the label thereof and to what effect? OPP.
4. Whether the defendants are passing off or violating the copyright of the plaintiff in the label of Howrah Biri ?
OPP.
5. Whether the suit discloses any cause of action? OPP.
6. Whether the plaintiff has made any false statements and material concealments of facts in the plaint and if so, to what effect? OPD.
7. Whether the suit is barred by the principles of delay, acquiescence, estoppel, waiver and laches? OPD.
8. Whether the plaintiff has the permission from the Excise Department to manufacture and sell biri of the mark Howrah. If so, to what effect? OPP.
9. Whether the defendants have the permission from the Excise Department to manufacture and sell biri of the mark HOWRAH. If so, to what effect? OPD.
10. Whether the defendants are guilty of misleading the TM no. : 57 of 2010 Page no. 4 of 41 public by describing HOWRAH BIRI registered under 721302? OPP.
11. Relief.
06. Vide order dated 15.07.2009 additional issue was framed:-
1. Whether the plaintiff has become the registered proprietor of the trademark HOWRAH BIRI (Label) during the pendency of the suit? If so, its effect?
OPP.
07. In order to prove its case plaintiff examined Sh. Sajjan Biswas as PW-1. Defendant in its support examined Dildar Hussain as DW-1, Tabrez Sheikh as DW-2, Rajeev Warshney as DW-3 and thereafter the evidence was closed.
08. Sh. R.K. Aggarwal, Ld. Counsel for the plaintiff has argued that both the marks/labels are registered and therefore, in view of Section 28 (3) of the Trademark's Act 1958. No action for infringement shall lie by or against each other. He submits that only an action for passing off would be maintainable and therefore, the principles governing passing off would apply. He has argued that both the labels are same; goods are similar, markets are same, trade channels are same. Ld. Counsel for the plaintiff has argued that for the selling 'Biri' excise License is required and the plaintiff has clearly proved that it TM no. : 57 of 2010 Page no. 5 of 41 was having a valid license.
09. On the contrary Sh. S.K. Bansal Ld. Counsel for the defendant has argued that two persons cannot have the same copy right.; in 1996 defendant applied for the registration of the trade mark and since the application of plaintiff is subsequent to the application of the defendant, there is a presumption that plaintiff had copied the label. It was argued that all the invoices and excise documents are subsequent to the invoices of the defendant. He has also argued the application no. 736949 for registration of trademark was abandoned by the plaintiff and therefore, plaintiff is now required to prove exclusive use in the year 1994-1995 to defeat the registered trademark. Ld. Counsel for defendant has also argued and laid emphasis that plaintiff has failed to prove that there is any assignment in favour of the plaintiff by Altab Hussain and therefore, the Pvt. Ltd. Company cannot claim user since 1995 as it came into existence in the year 1999, unless it can be shown that the rights were assigned by the Proprietorship concern to partnership firm and thereafter the firm assigned the rights to the Pvt. Limited Company. He has also argued that the wrapper which were submitted by the plaintiff to the Excise department already contained the Excise no. which was not possible. He has also argued that in 1994 the defendant applied for Excise license and in any case TM no. : 57 of 2010 Page no. 6 of 41 upto an amount of Rs. 20 Lakh levy of excise was exempted and as such there was no requirement for any Excise license.
10. In rebuttal it was argued that there was no assignment in as much as Altab Hussain never sold or parted with his trademark. Only the constitution of firm was changed.
11. I have heard the Ld. Counsels for the parties and perused the record carefully.
12. Before deciding the issues, it is relevant to note that lis between the parties would be governed by the old Act of 1958 (herein after referred to as the "Act"). In order to appreciate the contentions of the counsels the scanned copy of the labels of the plaintiff and that of the defendant is reproduced as under:-
TM no. : 57 of 2010 Page no. 7 of 41 The bare perusal of both the labels shows that they are identical barring the numerals. Plaintiff is using "102" and defendant is using "202". It is also an admitted position that both the trade mark stand registered during the pendency of the suit. Section 28 (3) of the Act lays down that when two or more persons are registered proprietor of trademark, which are identical with or nearby each other, the exclusive right to the use shall not be acquired merely by registration of the trademark. This Section clearly lays down that two registered proprietor cannot bring an infringement action against each other. However, their common law rights are protected. Hence in the present case, the principle governing passing off would apply as it is a common law remedy.
13. My issue-wise findings are as under:-
14. Issue no. 1:-
Whether the suit has been properly signed, verified and instituted by the plaintiff? OPP.
The onus to prove this issue is upon the plaintiff. Ld. Counsel for the plaintiff has argued that initially the suit was filed by Altab Hussain and subsequently the proprietorship concern was TM no. : 57 of 2010 Page no. 8 of 41 converted into Pvt.Ltd. Company and thereafter Sh. Sajjan Biswas has become the authorized representative of the company. It is the case of the plaintiff that earlier plaintiff was a proprietorship concern of Altab Hussain and subsequently it was converted into a partnership concern and thereafter into Jahangir Biri Factory Pvt. Ltd. in which Altab Hussain was also the director. The original plaint bears the signatures of Altab Hussain. PW-1 was specifically asked in his cross examination as to whether the plaint has been signed by Altab Hussain and he categorically replied that the suit has been filed by Altab Hussain. He also stated in his cross examination that the same was converted into the company in which Altab Hussain, himself, Emani Biswas and Mohd. Mustafa Hussain were the directors. On record it has been duly established that the Board of Directors of M/s. Jahangir Biri Factory Pvt. Ltd. had passed a resolution which is Ex.PW1/1 in favour of PW-1. The resolution clearly shows that PW-1 had the authority to depose as a witness in the present case. Vide order dated 02.05.2003, the description of the plaintiff was changed. Thus plaintiff has been able to prove that the suit signed, unified and instituted by an authorized person. The issue is accordingly decided in favour of the plaintiff and against the defendant.
15. Issue no. 2:-
TM no. : 57 of 2010 Page no. 9 of 41 Whether the counter claim has been properly signed, verified and instituted by the defendants? OPP. The onus to prove this issue was upon the defendant. Plaintiff while cross examining the defence witnesses has not even put a single question or suggest that Dildar Hossain was not competent to sign the counter claim. In fact he has not taken this objection in the written statement to the counter claim. Therefore, this issue is decided in favour of the defendant/counter claimant and against the plaintiff.
16. Issue no. 3 and 4:-
Who is the proprietor and prior user of the mark Howrah Biri and copyright in the label thereof and to what effect?
AND Whether the defendants are passing off or violating the copyright of the plaintiff in the label of Howrah Biri ?
OPP.
17. On the basis of arguments advanced by the Ld. Counsel for the parties in respect of these issues, the same can be categorized/clarified into 3 heads a) Assignment b) Prior User and c) Copy right.
(a). Assignment:-
It was argued by the Ld. Counsel for the defendant that TM no. : 57 of 2010 Page no. 10 of 41 plaintiff has failed to prove assignment from the proprietorship concern to the company. He had argued that the company which came into existence in the year 1999 cannot claim user since 1995. He has argued that a trademark needs to be assigned from a proprietorship concern to partnership concern and from there to the company only if the entire chain is proved, then the company can claim prior user from 1995. In support of his argument Ld. Counsel for the defendant has place reliance on the judgment of Harmohan Singh Vs. Gurbax Singh 2001 PTC 629 (Del), Gupta Enterprises Vs. Capital Enterprises 1998 PTC (18),M/s. Roshan Lal Oil Mills Ltd. Vs. M/s. Shakti Industries, 1995 PTC 212, B.S. Ramappa & Anr. V/s. U.B.Monappa & Anr. AIR 1970 Mad. 156, B.DA. Breweries & distilleries Ltd. Vs. Shree Durga Distilleries, 2002 (25) PTC 704 (Karn.) and Manmohan Plastic Pvt. Ltd. Vs. Ganpati Plastic Industries & Anr. 2014 (60) PTC 36 (Del).
18. On the other hand Ld. Counsel for the plaintiff has argued that initially Altab Hussain was the sole proprietor of Jahangir Biri Factory, then in the year 1997, Jahangir Biri Factory became a partnership concern in which Altab Hussain was also one of the partner and when the company was incorporated, he was one of the Director. He submits that Altab Hussain never left or abandoned his trademark, TM no. : 57 of 2010 Page no. 11 of 41 therefore, the question of any assignment deed does not arise. In support of his arguments he has placed reliance upon the following judgment: Shri Vishwanath & Ors Vs. Chaman Lal Khanna ILR (1975) 11 Delhi 265; Manmohan Plastic pvt. Ltd. Vs. Ganpati Plastic Industries & Anr. 2014 (60) PTC 36 Del; Manmohan Plastic Pvt. Ltd. Vs. Ganpati Plastic Industries & Anr. 2014 (60) PTC 36 (Del) and Glance Operations UK Ltd. Middlesex (England) & Ors. Vs. Samrat Pharmaceuticals, Kanpur AIR 1984 Delhi 265.
19. As per the provisions of Section 38 of the Act, an unregistered trademark shall not be assignable or transmissible except along with the goodwill of the business concerned.
20. As per Section 2 (a) assignment means an assignment in writing by act of the parties concerned: Thus as per the Act, assignment could only be in writing and in so far as unregistered trademark is concerned. It was assignable provided that the goodwill was also transferred.
21. There cannot be any dispute to the proposition of law as laid down in Roshan Lal Oil Mills (Supra), B.S. Ramappa; & B.D.A Breweries all the judgments lay down that assignment has to be in TM no. : 57 of 2010 Page no. 12 of 41 writing in order to claim the benefit of prior user. The reliance on the judgment of Vishwanath is misconceived as the same relates to Delhi Rent Control Act and does not further the cause of the plaintiff. In Manmohan Plastic (Supra) the Hon'ble Delhi High Court negated the arguments of the plaintiff therein in respect of there being no written agreement in favour of defendants to the use the trademark 'MONIKA' on the ground that since "MONIKA" was an unregistered trademark, therefore, no written agreement was required. The said judgment is squarely applicable to the facts of the case as also in the present case when the three different entities were using the mark, it was unregistered therefore, no written agreement was required in terms of the said judgment.
22. In Classic Equipments Pvt. Ltd. Vs. Vs. Johnson B. Enterprises 2009 (4) PTC 385, it was held that:-
Once an assignment deed has been executed, the assignor ceases to have any right, title or interest in the property assigned. It is not open to the assignor to cancel the assignment by means of a communication.
23. In Harmohan Singh (Supra) it was held that:
"When by a dissolution deed, rights and limitation of the parties are determined and defendant agree to give goodwill and all other rights in the said partnership firm to the plaintiff, it will include the right in the trademark of the partnership firm as well. Between the two TM no. : 57 of 2010 Page no. 13 of 41 partners, there may not be necessity to execute a separate assignment deed once the dissolution deed laying down right and obligation of erstwhile parties was reduced into writing".
24. In the facts of the present case. PW1 in his cross examination has stated that his father was initially doing the business as a proprietor of Jahangir Biri Factory, subsequently the said proprietorship concern was converted into a partnership consisting of 4 partners and subsequently the rights were transferred in favour of the company, he admitted that he did not place on record any written document which could show assignment in favour of the company executed by the partnership concern. It is an undisputed fact that Altab Hussain was initially a proprietor, then as a partner; and then a director. He was all throughout associated with the different concern. The Memorandum of Association Ex.PW1/3 clearly shows that the main object of incorporation of the company is to take over the going concern hereto been carried on as a partnership firm under the name and style of Jahangir Biri Factory having four partners namely Altab Hossain, Sajahan Biswas, Emani Biswas and Md. Mustafa Hossain. Ex. PW1/3 is the Memorandum and Article of Association which clearly suggest that it has taken over a going concern along with assets and liabilities. The law does not require any further proof.
TM no. : 57 of 2010 Page no. 14 of 41
25. There is yet another reason to discard the argument. Ex. PW1/9A, which is a registration certificate issued by the Excise Department contains an endorsement which is being reproduced as under:-
"Name of the partner reported as per partnership deed submitted by the assesses through his letter dated
26.05.1997.
1. Sajjan Biswas
2. Emami Biswas
3. Md. Mustafa Hussain Sd.
28.05.1997"
Supdt. Central Excise Act."
26. This clearly shows that plaintiff had informed even the Excise department regarding the change in the constitution of the firm from being sole proprietor to partnership. Therefore, it is immaterial if the partnership deed was not placed on record. In the eyes of law a different concern came into existence but as a matter of fact, the company was being run by the members of the family, only the status of firm had changed; from being a proprietorship concern to a Private Limited Co. Hence the argument of the Ld. Counsel for the defendant is liable to be rejected.
TM no. : 57 of 2010 Page no. 15 of 41 (b). Prior User
Ld. Counsel for the plaintiff has argued that in action for passing off, what is required to be established is that plaintiff was using the trademark, prior to that of the defendant. He has argued that it is the consistent stand of the plaintiff that they are using the mark since 25.08.1995 and defendants are subsequent to them. Reliance has been placed on the judgment of Neon Laboratories Ltd. Vs. Medical Technologies Ltd. 2015 (64) PTC 225(SC), Bimal Govind Ji Shah Vs. Panna Lal Chander Lal 1997 PTC 17; M/s. Amar Soap Factory Vs. M/s. Public Gram Udhyog Samriti 1985 PTC 85, L.D. Malhotra Industries Vs. Ropi Industries PTC (Suppl.) 2 564 (Delhi).
27. On the other hand Ld. Counsel for the defendant has argued that defendant is using the mark since January, 1995. Ld. Counsel for the defendant has placed reliance upon the judgment of Pioneer Nuts & Bolts Pvt. Ltd. Vs. Goodwill Enterprises 2009 (41) PTC 362 (Del) DB; Gandhi Scienfic Company Vs. Gulshan Kumar, 2009 40 PTC 22 (Del); Om Prakash Gupta Vs. Praveen Kumar & Anr. 2000 PTC 326; Century Traders Vs. Roshan Lal Duggar & Co. AIR 1978 Delhi 250.
TM no. : 57 of 2010 Page no. 16 of 41
28. Before coming to the facts of the case it is important to discuss the case law relied upon by both the Ld. Counsels for the parties.
29. In Pioneer Nuts (Supra) The Hon'ble Delhi High Court after relying on various authorities observed that in order to establish prior use, actual sales have to be shown and mere advertisements would not establish prior use.
30. In Gandhi Scientific (Supra) the Hon'ble Delhi High Court held that the bills and cash memo which do not contain the Sales Tax number or telephone number cannot be relied upon to establish prior user.
31. In Om Prakash Gupta (Supra) it was held that " In the case of an unregistered trademark the property right can be enforced only by an action for passing off. Hence, the rights on the mark cease when the circumstances necessary for success in a passing off action ceases to exist".
The Hon'ble Delhi High Court further observed that plaintiff has to establish continuous user of the trademark prior in point of time.
TM no. : 57 of 2010 Page no. 17 of 41
32. In Century Traders (Supra) it was held that in order to succeed in action for passing off, prior user is to be established of the mark prior in point of time than the impugned user by the defendant.
33. In Neon Laboratories (Supra) it was held that even after obtaining registration defendant did not introduce the product in the market nor took any steps to protect its mark and thus cannot claim benefit of registration.
34. In Bimal Govind Shah (Supra) it was observed that:-
"A prior user of a trademark is entitled to maintain an action against a subsequent user of identical mark including registered user thereof.
35. In M/s. Amar Soap Factory (Supra) it was observed that:-
"It is not necessary that the goods should have acquired a reputation for quality under that mark. Actual use of the mark under such circumstances as showing an intention to adopt and use it as a trademark is the test rather than the actual or duration of the use".
36. In L.D. Malhotra (Supra) it was held that anterior use by a person of a trademark is protected under law. It is immaterial if the infringer was prior in registration.
TM no. : 57 of 2010 Page no. 18 of 41
37. Therefore, the principles of law which can be culled down from the judgments are :-
a) In order to succeed in a suit for passing off prior user has to be established and the area, length and extent of the user are important factors.
b) Prior user would mean actual use and not merely advertisements.
c) Registration of the mark is inconsequential if the plaintiff can show prior use; it is immaterial whether a party has filed the application for registration prior in point of time.
38. Applying these principles to the facts of the case. In order to prove prior use, plaintiff has relied upon Ex. PW1/9, Ex.PW1/9A and on Ex. PW1/17 to Ex. PW1/40. On the other hand defendant has placed reliance on the bills Ex. DW1/5 to Ex. PW1/22 to prove that they are the prior user. Ex.PW1/9 is a registration certificate granted under the Central Excise in favour of Jahangir Biri Factory Pvt. Ltd. The said certificate is dated 13.03.2002 and is of no relevance Ex. PW1/9A is again a Registration Certificate granted in favour of Altab Hossain Proprietor of M/s. Jahangir Biri Factory on 25.08.1995 which clearly proves that 25.08.1995, the proprietorship firm was registered with the TM no. : 57 of 2010 Page no. 19 of 41 Excise Department. Ex. PW1/9A is a certified true attested copy which bears an endorsement which shows that constitution of the firm was changed from proprietorship to partnership on 28.05.1997. Ex. PW1/10 is a challan which shows that excise has been deposited on 25.09.1995 by the plaintiff for taking clearance. Ex.PW1/17 is the first bill dated 07.10.1995, which shows that goods worth of Rs.50,000/- has been sold to Emani Biswas. The bills also specify the trademark "Howrah Biri 102". There are about 20 bills of similar nature which shows that goods have been sold by the plaintiff. All these bills point out that by 1997, the sale of plaintiff was running into crores as would be relevant from Ex.PW1/39 and Ex.PW1/40. Plaintiff had complied with all the necessary rules and regulations, firstly on 25.08.1995 his firm gets registered with the Excise department, thereafter on 25.09.1995, he deposit the Excise through challan and thereafter sells his goods. No objection was raised by the defendant in respect of the mode of proof when these documents were exhibited, therefore, they can be looked into. No arguments have been addressed that these documents are not admissible in law reliance can be placed on the judgment of R.V.E. Venkatachala Gounder Vs. Arulmigu Viswesaraswami & V.P.Temple & Anr. 2003 8SCC 752. On record it is thus established that plaintiff was selling his product since 07.10.1995, under the Trademark "Howrah Biri 102". Therefore in TM no. : 57 of 2010 Page no. 20 of 41 order to establish prior user the defendant would have established that he was actually using the trademark prior to 07.10.1995.
39. Now coming to the documents of the defendant, the bills which were exhibited as Ex.DW1/5 to Ex. DW1/19 in the affidavit were de-exhibited and they were marked. Bill No. 001 is dated 05.01.1995, which was marked as Mark B, was issued in favour of Shakti Traders, the perusal of the same shows that "Howrah Biri no. 202" has been stamped on the bill. It neither bears the signatures of consignee nor it shows as to how the goods were sent from West Bengal to Delhi, similarly are the bills Mark C to Mark H. The bills are photocopies and their original were never placed on record and as such no reliance can be placed on these bills to prove that defendant was a prior user. Bill no. 10 dated 05.05.1995 was exhibited as Ex. DW1/12 in the evidence by way of affidavit. When the documents were filed with written statement a photocopy of Bill No. 10 was also filed. The same was exhibited as Ex. DW1/P2. On comparison, of these two bills it is clear that Bill no. 10 which was exhibited as Ex.DW1/P2 is not the copy of its original i.e. Ex. DW1/12. In Ex.DW1/12, the name of the factory of the defendant, the mark are mentioned, whereas in the photocopy Ex. DW1/P2 which was originally placed with written statement, neither the name of the factory nor the mark is mentioned. DW-1 in his cross TM no. : 57 of 2010 Page no. 21 of 41 examination has come out with an explanation that 3 copies of bills were prepared, one was sent to the customer, one was retained by them and third is there in the bill book. No reasonable man can explain as to why there was a difference in two copies. If simultaneously three bills are prepared, the trademark which is stamped on Ex.DW1/12 then naturally it would leave impression on third copy which is not so. The only conclusion is that all these bills are bogus and cannot be relied upon. Similarly Ex. DW1/13 and Ex. DW1/14 cannot be relied upon as they are not the photocopies of the document which were originally filed with the written statement. Reliance in this regard can be placed upon the judgment of Metropol India (P) Ltd. Vs. Praveen Industries India (Regd) 1997 PTC (17) (DB).
40. DW-2 has proved the bill No. 21 which was exhibited as Ex. DW1/15. In the cross examination he has stated that he does not poses the original. He could not produce the stock register, purchase register or any other document to show that goods were sent to him through the said invoice. Reliance can be placed on Castrol Ltd. & Anr. Vs. Mr. Subhash Kappor & Ors 1997 PTC-31. Even assuming for the sake of argument that this is a valid bill the same is dated 16.08.1996, much after the date of 07.10.1995 and is of no help to the defendant.
TM no. : 57 of 2010 Page no. 22 of 41
41. DW-3 Rajeev Varshney was the seller of defendant's biri, he could not produce the original of bill No. 009 dated 20.03.1995 which was Ex. PW3/1. The testimony of this witness cannot be relied upon to believe that defendant was using the trademark prior to that of the plaintiff. The perusal of the bill shows that it does not bear the trademark of the defendant. It is simple cash bill without having any reference to excise number or the mode through which the goods were sent from West Bengal to Delhi. No authenticity can be attached to such bill. The testimony of DW-3 cannot be relied upon and is liable to be discarded.
42. Interestingly Mark E is Bill no. 004 dated 28.01.1995 and Mark F is bill no. 005 dated 06.08.1995. If that be the case, how it is possible that bill no. 009 is dated 20.03.1995. This clearly proves interpolation. This goes to show that bills were created only to defeat the genuine claim of the plaintiff. It was also argued that an application was filed by the defendant before the trademark registry for correcting the user details wherein user was claimed since 01.01.1995. The application was filed after filing of the present suit. The application was not supported by any document. This again goes to show that it was done deliberately. Reference in this regard can be made to the TM no. : 57 of 2010 Page no. 23 of 41 judgment of Premier Tissues India Ltd. Vs. Rotia Tissues Industries 2012 (50) PTC 2006 (Del).
43. It is argued that defendant had filed the application before the Trademark Registry prior to the plaintiff. It is well-settled law that merely filing of the application does not give any right to the parties in so far as the law of Trademark is concerned. Reliance can be placed upon the judgment of L.D. Malhotra Industries (Supra).
44. Lastly It is also to be seen that the stand of the defendant with respect to the use is not consistent. In the written statement dated 17.08.1997 it was stated that defendant is using the trademark since 1995 without actually mentioning the exact date. In the replication to the amended written statement, to the counter claim it was stated that defendant is using the trademark since 01.01.1995. The inconsistent stand taken by the defendant in itself shows that there was no clarity in the mind of the defendant as to from when he was using the trademark/label.
45. Hence the plaintiff is held to be the proprietor and prior user of the trademark/label "Howrah Biri 102".
TM no. : 57 of 2010 Page no. 24 of 41 (c) Copy Right:
Ld. Counsel for the defendant has argued that plaintiff cannot claim copy right over the label as in the copy right application which is Ex. PW1/8 the plaintiff has stated that Sh. Sajahan Biswas was the author of such label whereas PW1 i.e. Sajahan Biswas in his cross examination has stated that the label "Howrah Biri No. 102" was designed by some artist at the instructions of his father and has relied upon the judgment of Glaxo Operations UK Ltd. Middlesex (England) & Ors. Vs. Samrat Pharmaceuticals, Kanpur AIR 1984 Delhi 265.
46. The Hon'ble Delhi High Court in Glaxo Operations (Supra) held that:-
Defination of word 'Author' and Section 17 lay great emphasis on the fact that copyright vest in that person who is original creator of the work. In some cases it may not be possible to be definite as to who was the original creator. In such cases, therefore, obviously the person who got registration earlier or who is established to be earlier user can be presumed to be the author or original creator of the artistic work".
47. In the present case PW-1 has clearly admitted that he is neither the author nor the original creator of the artistic work. However, in the judgment of Glaxo (Supra) it was held that a person can claim copyright if he establishes prior user which in the opinion of TM no. : 57 of 2010 Page no. 25 of 41 this court, plaintiff has been successfully been able to do so. Thus he is also entitled to copyright in the said label although he has not been able to establish who was the author. In view of the above discussions, issue no. 3 and 4 are decided in favour of the plaintiff and against the defendant.
48. Issues no. 5 and 6 :-
Whether the suit discloses any cause of action? OPP.
AND Whether the plaintiff has made any false statements and material concealments of facts in the plaint and if so, to what effect? OPD.
The onus to prove this issue was upon the defendant. Ld. Counsel for the defendant has argued that in para 2 of the plaint, plaintiff had pleaded that he had applied for registration vide application No. 736949 in class 34, in the year 1996 and in the amended plaint he has not disclosed the status of application, moreover he has stated in the amended plaint that his mark was registered vide no. 1401112. According to the Ld. Counsel this not only amount to abandonment of the mark. He has also argued that plaintiff did not disclose that defendant had in fact given a reply to the legal notice issued by the plaintiff which amounts to concealment of TM no. : 57 of 2010 Page no. 26 of 41 material facts and has relied upon the judgment of KRBL Vs. Lal Mahal Ltd. & Anr. 2015 (62) PTC 82 (Del). On the other hand Ld. Counsel for the plaintiff has argued that earlier application was not pressed and it is not the case of the defendant that at any point of time, plaintiff had stopped using the mark. Reliance in this regard was placed on the judgment of Whirlpool Company Vs. N.R. Dogra 1995 (32) DRJ 318 and Penguine Books Ltd. Vs. M/s. India Book Distributor AIR 1985 Delhi 29.
49. The Hon'ble Delhi High Court in Eaton Company Vs. BCH Electric Limited 2013 (55) PTC 417, while relying on the judgment Whirlpool Company (Supra) had observed that question of abandonment depends on determining the intention to be inferred from facts of each case while a mere non-user for a few years may not amount to abandonment of a trademark of referable to accountable facts, a long unexplained non-user may suggest an intention to abandon the mark.
50. At the outset, it is stated that there is no averment in the written statement that plaintiff had abandoned the mark on account on non-user. Thus the defendant cannot be allowed to raise the plea of abandonment of the trademark merely on the ground that his TM no. : 57 of 2010 Page no. 27 of 41 application was shown as such. There are no pleadings that plaintiff had stopped using the trade mark/label. The plea of abandonment as sought to be set up is unsustainable in law and as such is liable to be rejected.
51. In KRBL Ltd. Vs. Lal Mahal Ltd. & Anr. 2015 (62) PTC 82 (Del) the Hon'ble Delhi High Court denied the relief of injunction and one of the ground was that plaintiff had not disclosed about the dismissal of two application before the registrar. The said judgment was upheld by the division bench of the Hon'ble Delhi High Court.
52. The said judgment is not applicable to the facts of the case as in the present case, plaintiff had disclosed that he had filed the application what has not been disclosed is the status. It is not a case of material concealment which would dis-entitle the plaintiff for the relief claimed.
53. In Penguine Books Ltd. Vs. M/s. India Book Distributor AIR 1985 Delhi 29 the Hon'ble Delhi High Court held that the maxim of clean hands must not be taken too widely.
54. In so far as concealment of facts is concerned, the only TM no. : 57 of 2010 Page no. 28 of 41 argument is that plaintiff had not placed on record the reply given by defendant. In my opinion, no favourable order was placed on account of this. Moreover, along with the replication the said document was placed on record. The error, if any was rectified. Accordingly, issue no. 5 and 6 are decided in favour of the plaintiff.
55. Issue no. 7:-
Whether the suit is barred by the principles of delay, acquiescence, estoppel, waiver and laches? OPD. The Hon'ble SC in Power Control Appliances & Ors. Vs. Sumeet Machines Pvt. Ltd. 1995 PTC 165 has observed that delay simplicitor is no defence for infringement of the trademark.
56. 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 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.
57. In case of Swaran Singh Trading as Appliances Emporium vs. Usha Industries (India) & Anr. 1986(6) PTC, 287 (Del) TM no. : 57 of 2010 Page no. 29 of 41 (DB), 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".
58. 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 equitable defence can be put by a party who has acted fairly and honestly.
59. In M/s Hindustan Pencils Pvt. Ltd. vs. M/s India Stationery Products Co. AIR 1990 Delhi 19 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 TM no. : 57 of 2010 Page no. 30 of 41 is not denied".
60. 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".
61. It was further observed that :
"Where the plaintiff, however, is guilty of 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".
62. 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 TM no. : 57 of 2010 Page no. 31 of 41 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 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.
63. 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 apply.
64. As per the plaint, plaintiff started manufacturing the goods in TM no. : 57 of 2010 Page no. 32 of 41 August 1995 although no date, month or year has been mentioned as to when he came to know about the activities of the defendant, but the suit was filed in July, 1997. It cannot be said that it is a case of delay, laches or acquiescence is made out as which would dis-entitle the plaintiff from the relief of injunction. The issue is accordingly decided in favour of plaintiff and against the defendant.
65. Issue no 8 and 9:-
Whether the plaintiff has the permission from the Excise Department to manufacture and sell biri of the mark Howrah. If so, to what effect? OPP.
AND Whether the defendants have the permission from the Excise Department to manufacture and sell biri of the mark HOWRAH. If so, to what effect? OPD.
Sh. R.K. Aggarwal Ld. Counsel for the plaintiff has argued that for selling, manufacturing Biri, Excise License is required and the plaintiff was having a valid Excise License, on the contrary defendant did not possess any license. In support he has relied upon the judgment of Peddi Yirayya Vs. Doppalapudi Subbo Rao & Anr. Vs. AIR 1959 AP 647 & Mr. Sunil Parmeshwar Mittal Vs. Deputy Commissioner 2005(4) MHW 837.
66. On the other hand Sh. S.K. Bansal, Ld. Counsel for the TM no. : 57 of 2010 Page no. 33 of 41 defendant has argued that defendant applied for Excise License on 21.09.1994, much prior to the plaintiff which is clear from the application of even date. He has submitted that there was an exemption of excise duty on the 'biris" sold for less than Rs. 20,00,000/-. According to him Excise Act is for collection of revenue and Trademark Act would prevail, being Special law, in the alternative he has argued that use of his trade mark does not become illegal even assuming for the sake of arguments that there was any violation of Excise law. Ld. Counsel for the defendant has placed reliance on the report of the Priya John on Bedi Industry & Welfare of Workers; Playboy Enterprises Inc. Vs. Bharat Malik & Anr. 2001 PTC 328; Bayer Corporation & Ors. Vs. UOI & Ors. 2009 (41) PTC 634 (Del); Notification No. 8/03 dt. 01.03.2003. In rebuttal Ld. Counsel for the plaintiff has referred to the Excise Notification No. 4/97 dated 01.03.1997, 5/99 dated 20.02.1999; the speech of Sardar Charan Singh the then Hon'ble Deputy Prime Minister; D.O.F. No. 334/1/07- TRU dt. 28.02.007 and upon the judgment of S.N.Mohideen Vs. UOI 1989 39 ECT 376 Mad.
67. In Peddi Viravya (Supra) it was noted that tobacco is one of the items listed in the 1 st Schedule of Central Excise Act and any trading without a license either on one's own account or as commission TM no. : 57 of 2010 Page no. 34 of 41 agent would render the said transaction as illegal. The observations were made in the context of Contract Act and in the present case the dispute is not whether Biri require excise license but, as to whether who had obtained excise license in order to establish prior user. Similar are the observation in Sunil Parmeshwar Mittal (Supra). There can be no denial that if the goods which attract excise duty are sold without Excise License then Section 9 of the Central Excise Act would operate as a complete bar to such transaction but there are no observations or findings as to what would be the consequences vis-a- vis Trademark. In other words, if there is a sale of a product which require Excise License, and sale is made without a valid license, would the trade mark/label under which sale is made would be void for the purpose of establishing prior user or the fact that the trade mark was being used by such person. The answer would in my opinion lie in negative. In Bayer Corporation (Supra) it was clearly held that:
"The Petitioners who are proprietors or users of the trade mark, have a right to sue for their trademark under the provision of the Trade Mark Act. Denying them this use not only puts their property rights into jeopardy but is in clear derogation of the rights guaranteed by the provisions of the Trade Marks Act".
68. In Playboy Enterprises Inc. Vs. Bharat Malik & Anr.
TM no. : 57 of 2010 Page no. 35 of 41 2001 PTC 328 (Del) the Hon'ble Delhi High Court has held that trademark law is a special law and would prevail over the Press & Registration of Books Ac, 1867.
69. In view of the law as stated above it cannot be said that violation of Excise Law would ispo facto mean that all the transactions for the purpose of trademark Law of the defendant would became invalid. The transaction will have to be seen independently.
70. It was next contended that Biri does not come under the Excise Act, as there was an exemption for the manufacture where the annual sale is less than Rs. 20,00,000/-. There are no pleadings on the basis of which this arguments is built. Hence the same is ought to be rejected out rightly. In any case the exemption, if any, was given to such manufactures who were selling the biri without a brand name. Reference in this regard can be made to the speech of the Hon'ble Dy P.M as well as Excise notification dated 4/97 dated 01/03/1997. Here in the present case, both the plaintiff and defendant are selling the biri under a brand name.
71. Now coming to the facts of the case, according to plaintiff he had applied for excise license in the year 1995, on the contrary it is the specific case of the defendant that vide Ex. DW1/4, he was granted TM no. : 57 of 2010 Page no. 36 of 41 Excise License.
72. Ex. DW1/4 is a letter written to the Excise Department wherein a request has been made by the defendant for issuance of Excise license. Apart from this communication nothing has been placed on record by the defendant. In the cross examination he has denied that there is any particular form for issuance of license. The defendant has not pleaded that he is in power and possession of any Excise license. The license number has not been stated by the defendant. Ex. DW1/4 does not inspire confidence, neither the same can be termed as an Excise license. Civil suits are to be decided on the basis of pre-ponderance of probabilities. In comparison to the letter submitted by the defendant. The evidentiary value of the registration certificate Ex. PW1/9A is on the higher side.
73. It was also argued by the Ld. Counsel for the defendant that it is unimaginable as to how the labels of the plaintiff were having Excise Number when they were submitted for approval. Ex. PW1/9A is the registration certificate. The perusal of the same shows that it was granted in favour of Altab Hussain on 25.08.1995 vide R.C. No. 8/Ch. 24/Biri/ABD/95. The registration is dated 25.08.1995 and thereafter plaintiff submitted his label to the Excise Department which bear the TM no. : 57 of 2010 Page no. 37 of 41 said number except the numerical number '24', instead of '24' in one of the label '2404' is printed and in another label '240' is printed which could possibly be a typographical error, the remaining number is same. The labels for approval were submitted before the Excise department on 05.10.1995 vide Ex. DW1/P1, therefore, the argument that some kind of fraud were played is liable to be rejected. Ex. DW1/P1 is more than 20 years old document, and has been verified by the Superintendent, Central Excise Department, it is a public record and thus can be safely relied upon. On the basis of evidence placed on record, it cannot be said that defendant had any permission to sell the "Biris" and had obtained any permission from the Excise which was of the essential requirement. Accordingly issues no. 8 and 9 are decided in favour of the plaintiff and against the defendant.
74. Issue no. 10:-
Whether the defendants are guilty of misleading the public by describing HOWRAH BIRI registered under 721302? OPP.
The onus to prove this issue was upon the plaintiff. The defendant's label has been exhibited as Ex. PW1/4. The perusal of same shows that the same has the photograph of a person in between and thereafter a bridge is shown. It also bears the registration number 721302.
TM no. : 57 of 2010 Page no. 38 of 41
75. In the written statement or the counter claim defendants have not stated that their mark is registered on the contrary in para 9 of the preliminary objection of the amended written statement dated 22.07.2009 it is categorically stated that they have applied to the Trademark Registry on 30.10.1996 and the application is still pending.
In Sagar Beedi Works & Anr. Vs. Bharath Beedi Work & Anr. 1981 PTC 269, the Hon'ble Bombay High Court observed that no relief can be granted to a party who uses the word "Registered" in their trademark without actually the trademark being registered and is sufficient evidence to conclude that the user was tainted with dishonesty. In view or the categorical admission of the defendant that their application is still pending the defendant have wrongly stated that their mark is registered vide registration no. 721302 and thereby misled the public into believing that their mark is registered. The issue is accordingly decided in favour of the plaintiff and against the defendant.
76. Additional issue :-
Whether the plaintiff has become the registered proprietor of the trademark HOWRAH BIRI (Label) during the pendency of the suit? If so, its effect?
OPP.
The onus to prove this issue was upon the plaintiff. No TM no. : 57 of 2010 Page no. 39 of 41 evidence was led by the plaintiff to prove that its trademark/label has been registered during the pendency of the suit. The issue has become inconsequential as the trademark of the defendant was also registered during the pendency of the suit. Vide order dated 13.12.2017, this court declined to frame an additional issue in respect of defendant having become a registered proprietor. The issue does no survive, neither any arguments were addressed on this issue. Hence, the same is struck off.
77. Issue no. 11:-
Relief.
The bare perusal of the logos as shows above, shows that they are identical in nature, the colour scheme, get up, lay out of both the labels is almost similar, the resemblance between the two labels is nearly identical. The numerals 102 and 202 are written in Hindi which is also quite similar. It is a matter of common knowledge that Biri are essentially purchased by illiterate people and mostly by the people belonging to lower strata of the society and it becomes difficult for them to distinguish. The defendants had used the trademark in such a manner so as to pass off his goods as that of the plaintiff. Hence, plaintiff is entitled to Decree of Permanent Injunction. The defendants and its agents are retrained from using the trademark/label "Howrah TM no. : 57 of 2010 Page no. 40 of 41 Super Biri 202" or any other trademark/deceptively similar to the trademark/label of the plaintiff. The defendant shall dispose off the entire stock within the period of 3 months carrying the impugned label. The plaintiff is also entitled to a sum of Rs. 3,00,000/- (Rupees Three Lacs) as damages in terms of the Judgment in Jockey International V. R. Chandramohan 2014 211 DLT 75 and "World Wrestling Entertainment Inc. Vs M/s Reshma Collection & Ors." 2017 (70) P.T.C. 550.
Decree sheet be prepared after paying the additional court fee. No orders as to cost.
File be consigned to Record Room.
Digitally signed by ANKUR JAIN
Announced in the open court on ANKUR Date:
30th October, 2018 JAIN 2018.10.31
15:23:52
+0530
(Ankur Jain)
Addl. District Judge (Central)-10
Delhi
TM no. : 57 of 2010 Page no. 41 of 41