Bombay High Court
Reliance Industries Ltd. vs Reliance Polycrete Ltd. on 4 July, 1997
Author: S.N. Variava
Bench: S.N. Variava
JUDGMENT S.N. Variava, J.
1. This is a Notice of Motion for injunction in an action for passing off. By this Notice of Motion, Plaintiffs seek to restrain the Defendants from using in respect of any goods the mark "Reliance" or any other mark which is deceptively similar to the mark "Reliance" so as to pass off the business and/or products of the Defendants as those of the Plaintiffs. The Plaintiffs also seek an injunction to restrain the Defendants from using the work "Reliance" as part of its corporate name. The Plaintiffs further seek ancillary reliefs.
2. Mr. Tulzapurkar submits that the Plaintiffs were incorporated in 1966 as Reliance Textiles Industries Limited. He submits that in 1976 one Nylon Limited was amalgamated with the Plaintiffs. He submits that in 1985, the work "Textile" was deleted from the name of the Plaintiff Company. He submits that the Plaintiffs are manufacturing Textiles, Yarn, Petrochemicals and Polyester Resins. He submits that the Plaintiffs have "Reliance" as a Registered Mark in Class-23 under No. 34123-B. Mr. Tulzapurkar however clarifies that in this Notice of Motion Plaintiffs are not claiming any reliefs on the basis of infringement.
3. Mr. Tulzapurkar further submits that apart from the Plaintiffs, there are a large number of group Companies carrying on varying businesses under the following names :
(1) Reliance Petroleum Limited (2) Reliance Capital Limited (3) Reliance Industrial & Infrastructures Limited (4) Reliance Power Limited (5) Reliance Telecom Private Limited (6) Reliance Europe Limited.
4. Relying upon Exhibit-D to the Plaint, Mr. Tulzapurkar submits that the Plaintiff-Company have a very large sale and turnover. He also relies on Exhibit-E to the Plaint to show that the Plaintiff-Company have carried on an extensive saies promotion and advertisement expenditure.
5. Mr. Tulzapurkar submits that by reason of a Circular dated 18th December, 1995, the Plaintiffs came to learnt that the Defendants are carrying on business with the use of the name "reliance" as its corporate name and that the Defendants used "Reliance" as a Trade Mark. Mr. Tulzapurkar points out the Circular dated 18th December, 1995 which is at Exhibit-F1 to the Plaint. He also points out the prospectus which had been issued by the Defendants. He points out that in the prospectus the Defendants have in hold letters put note to the effect that they are not directly or indirectly connected with the Plaintiff Company or their group Companies. He submits that this itself shows that even according to the Defendants there was likelihood of deception and confusion in the minds of the public. Mr. Tulzapurkar also points out the following from the prospectus as follows :
"The company was not engaged in any operations during the period 1986-91 and it started commercial operation only in July, 1991 with the manufacturing of cultured marble sanitary were like bath Tubs, wash basin, W.C. etc. Few more items like kitchen sinks, shower trays, soap dishes were added in 1992. During the year 1993 product range was expanded with the inclusion of mirror frames, staircase pillars and urine pots etc. besides diversifying into the manufacturing of fibre glass bath Tubs. At present the Company has manufacturing facilities for Cultured Marble, Acrylic and Fibre Glass products under one roof.
The Company had taken term loans of Rs. 46.40 lacs and Rs. 9.10 lacs from UPFC in the years 1989 and 1991, respectively. The Company has entered into a one time settlement in 1994 with UPFC. There was a delay of 45 days and 22 days in repayment of two instalments of Rs. 4,27,600/- each in repayment of term loan. The term loan has been fully repaid to UPFC in the year 1994-95.
Dr. Sudesh K. Jain took control over the Company in January 1994, and at that time the Company was not in a position to fully utilize its installed capacity and in the meantime the Company started trading and marketing activities. The trading activities consisted of trading in computer software and marketing activities consisted of commission received for liaison work and procurement of orders. The Company also undertook trading in computer hardware during April and May 1995. All these trading and marketing activities have since been discontinued and now the Company is concentrating only on manufacturing activities."
6. He submits that this itself shows that all prior activities have come to an end. He submits that therefore, the question whether they had prior activities or not is now entirely irrelevant. Mr. Tulzapurkar also points out from the prospectus that one of the items manufactured by the Defendants is Polyester Resin. He also points out that the name "Reliance" is used not just as a Corporate name but also as a Trade Mark.
7. Mr. Tulzapurkar submits that the Plaintiff Company and their group Companies have also applied for registration of the mark "Reliance" under Classes-1, 24 and 25. He points out that those Applications are pending. He submits that the Plaintiff-Company and their group Companies have been continuously using the name "Reliance". He submits that eventhough this is not an invented word, it has acquired a special meaning and significance. He submits that people have come to associate this work with the Plaintiff Company and their group Companies.
8. Mr. Tulzapurkar relies upon the authority in the case of M/s. K. G. Khosla Compressors Ltd. v. M/s. Khosla Ewtractions Ltd. & Others (AIR 1986 Delhi 18). In this case, the name of the Plaintiff-Company was M/s. K. G. Khosla Compressors Limited. The name of Defendants was M/s. Khosla Extractions Limited. In this case, it has inter alia been held that the Civil Court has powers to grant an injunction in an action based on passing off of the name of the Plaintiff-Company. It has been held that there is no limitation on the exercise of jurisdiction by a Civil Court.
9. Mr. Tulzapurkar also relied upon the authority in the case of Simatul Chemical Industries Pvt. Ltd. Nandeshari v. Cibatul Ltd. . The Court has held that the principles by which the case must be decided are well established. It is held that the fundamental principle is that a person shall not trade under a name so closely resembling that of the Plaintiff as to be mistaken for it by the public, in other words, that a person shall not carry on his business in such a way as to represent that his business was the business of another person. The Court held that question to be determined in cases of this type is whether there is such a similarity between the two names as that the one is in the ordinary course of human affairs likely to be confounded with the other. The Court held that it is not necessary to prove that the Defendants in taking the name complained of by the Plaintiffs with any fraudulent intent. The Court held it is enough, for the Plaintiff to prove that the act of the Defendants in assuming the name complained of is an injury to the Plaintiffs' rights. The Court held that in such cases, there is no question of property or monopoly in the name. The Court held that in such cases, the principle is not that there is a properly in the word, but whether there is a fraud on a person who has established the trade and carries it on under a given name by some other person who assumes the same name or the same name with a slight difference, in such a way as to induce persons to deal with him in the belief that they are dealing with the person who has given a reputation to the name.
10. Mr. Tulzapurkar submits that this establishes that there can be confusion as to the source if the same name is used. He submitted that this also establishes that even if Defendants had adopted the name innocently, still the Count can grant injunction if there is loss to the Plaintiffs. Mr. Tulzapurkar submits that this case shows that public interest must be taken into account. He submitted that the consumers require to be protected if there is any danger of confusion being caused in their minds and/or if there is a likelihood of their being led into believing that the product is in reality manufactured by Plaintiffs or by someone connected with the Plaintiff's. He submits that in such cases the Court must grant injunction.
11. Mr. Tulzapurkar also relied upon the authority of the Supreme Court in the case of Corn Products Refining Co. v. Shangrila Food Products Ltd. . In this case, the Supreme Court has held that in deciding the similarity of two marks the Court has to approach it from the point of view of a man of average intelligence and of imperfect recollection. The Supreme Court has negatived the submissions that as the goods were not of the same description, there was no risk of confusion or deception in spite of the similarity of the marks. The Supreme Court has held that glucose was used in the manufacture of biscuits and that would establish a trade connection between the two commodities, namely, glucose manufactured by the Appellant and the biscuits produced by the Respondent. The Supreme Court has held that an average purchaser would therefore be likely to think that the Respondent's 'Gluvita biscuits' were made with the Appellant's 'Glucovita' Glucose.
12. Mr. Tulzapurkar also relied upon the authority in the case of Kirloskar Diesel Recon Pvt. Ltd. and Another v. Kirloskar Proprietary Ltd. and others . In this case, it has been held that in a passing off action, it was not necessary that there should be a common field of activities. It has been held that in case of trading name which has become almost a household word and under which trading name a variety of activities are undertaken a passing off action can successfully lie if other person has adopted identical or similar trading name even when such other person does not carry on similar activity. It has been held that even if the Appellants' activities are remote, the same are likely to be presumed a possible extension of Respondent's business or activities.
13. Mr. Tulzapurkar submitted that the word "Reliance" has acquired a special significance and is associated with the Plaintiff-Company and their group of Companies. He submitted that under these circumstances, it was not necessary that there must be a commonality of business or trading activities. He submitted that even otherwise, the Defendants were manufacturing Polyester Resin which is also being manufactured by the Plaintiff-Company. He submitted that as a result of this common activity a common man would associate the Defendants' products and Company as being one of the Plaintiff group Companies or somebody associate with the Plaintiff-Company and their group Companies.
14. As against this Mr. Nair submitted that the Plaintiff Company has a registered Mark only in Class-23 i.e. for "Yarns and threads". He submitted that thus it is only for "Yarns and threads" that the Plaintiff Company have a monopoly. He submits that very significantly, whilst giving a list of group Companies it has not been stated as to when those Companies were incorporated and what activities they carry on. He submits that except for the mark which is registered in Class-23, all other Applications for Registration, by the Plaintiff-Company, are pending. He submits that the Defendants have also made Applications for Registration which are pending.
15. He submits that at the Ad-Interim stage itself the Defendants had made a statement that they manufactured Polyester Resins only for personal utilization. He submits that the Defendants had given an undertaking that they would not sell the Polyester Resin in the market. He submits that the Defendants are willing to continue the undertaking that the Polyester Resin manufactured by them will be only for personal consumption and that the Defendants would not sell the same in the market, under the mark "Reliance" till the final disposal of the suit.
16. Mr. Nair submits that Mr. Tulzapurkar was not right in stating that the Defendants had discontinued their activities. He shows to Court the prospectus. He shows that what has been discontinued is only the trading activities. He points out that the manufacturing activities, which have been undertaken from the beginning, are continued by the Defendants till date. He submits that the Defendants have been manufacturing sanitary wares from 1991. He submits that the activity of manufacturing sanitary wares has not been discontinued at any stage. He submits that the Defendants adopted the corporate name and the Trade Mark without any intention to trade on the Plaintiff-Company's name or reputation. He submits that the bona fides of the Defendants was shown from the fact that at the time of the Public Issue, when SEBI asked the Defendants to put a note in the prospectus to the effect that they were not directly or indirectly connected with the Plaintiff-Company, the Defendants put in such a note without any hesitation.
17. Mr. Nair further submits that the whole action of passing off is based upon the so-called reputation of the Plaintiffs in the name "Reliance". He submits that this action is based upon a case that, no matter what the field of activity was a common man would associate the word "Reliance" only with the Plaintiff-Company and their group Companies. He submits that this assumption on the part of the Plaintiff-Company and is misconceived. He points out that without there being any confusion or deception, by 1990 there were in existence 167 Joint Stock Companies with the Name "Reliance" as their Corporate Name. He submits that now there must be more. He further points out that in the Bombay Telephone Directory there are 83 Companies and firms with the name "Reliance" as their Corporate/firm Name. He further points out that the word "Reliance" has either been registered as a Trade Mark or Applications for Registration of the word "Reliance" as a Trade Mark are pending in as many as 50 cases. He submits that it is admitted that the word "Reliance" is not an invented word. He submits that it is also clear that the word "Reliance" is not associated only with the Plaintiff-Company or their group Companies in all fields of activities or trade. He submits that from the names of the various Companies, (listed in Exhibits-J, K and I to the Affidavit in Reply), it would be clear that Companies with the name "Reliance" are carrying on all fields of activities and trade and manufacture various commodities including textiles and chemicals. He submits that therefore, it is not correct to say the word "Reliance" has become synonymous with the Plaintiffs or their group Companies.
18. He submitted that as the word "Reliance" is not synonymous with Plaintiff-Company or their group Companies there is no reason by the Defendants, who have innocently chosen this name and who are using this for the last so many years, should now be restrained. He submits that the whole purpose of this application was to bring pressure on the Defendants at a time when the Defendants were about to bring out a Public Issue. He submits that all the cases relied upon by Mr. Tulzapurkar were either cases where the name or mark was unique and an invented one. He submitted that in all these cases the word was not a word common to the English language. He submitted that those were cases where the Plaintiff-Company alone had developed a reputation in that word and/or mark. He submitted that those cases have no relevance to a case like the present where the word "Reliance" is used by a number of Companies and firms in all fields and trades. He submitted that for all these reasons, the Notice of Motion should be dismissed.
19. As stated by Mr. Tulzapurkar, this is not an action of infringement. In fact an action of infringement would not lie because the only registered mark is in Class-23. Admittedly, the Defendants are not manufacturing either Yarn or threads. This action is therefore based on passing off. An action in passing off has necessarily to be based, as Mr. Nair put it on the footing that the word "Reliance" has become synonymous with the Plaintiff's and their group Companies. In other words the Public or the common man associates the word "Reliance" only with the Plaintiffs and their group Companies irrespective of what the field of activity or trade in which it is used. Mr. Nair is quite right that apart from showing that the Plaintiff-Company is incorporated in 1966, very conveniently it is not stated when the other Companies were incorporated. Very conveniently it is also not stated what activities are carried out by the other group Companies. Even otherwise by the time the Plaintiff-Company was incorporated, there were already in existence at least 10 Joint Stock Companies with the word "Reliance" as their Corporate Name. Since then, there are in existence, only upto 1990, 167 Joint Stock Companies with the name "Reliance" as their Corporate Names. As pointed out by Mr. Nair the Bombay Telephone Directory has listed 92 Companies/firms with the name "Reliance". Undoubtedly the Plaintiff-Company is a big Company having a large turnover. In the field of yarns and/or threads they may have acquired a distinctiveness in order to enable them to get a Registered Mark in Class-23. However, their is no material or evidence to show that the word "Reliance" is associated by the public only with the Plaintiffs or their group Companies in all fields of activities or trades. All the cases cited by Mr. Tulzapurkar were the cases where the word was not a common English word but an invented word which had come to be associated with the Plaintiff-Company. Those cases could therefore have no application to the present case, when the word is a common word in English language and where no material is placed before the Court to show that in all fields of activities or trades it has come to be associated only with the Plaintiffs or their group Companies. In my prima facie view it does appear to be a case of too much self importance given to themselves by the Plaintiffs. Fact that so many Joint Stock Companies and firms, having word "Reliance" as their Corporate/firm Name exist belies case that public/common man associates the word only with the Plaintiffs or their group Companies, no matter what the field of activity.
20. Further the Defendants have been using the word "Reliance" as its Corporate Name as well as a Trade Mark since 1991 at least. The figures of sales shown by the Defendants indicate that this Defendants also have a fairly large sale and their products are widely advertised. The Plaintiff-Company which claims to be such a big Company could hardly have not noticed these advertisements for all these years. Even presuming they did not, still the fact remains that not a single instance of deception or confusion could be pointed out. Also it is not the Plaintiffs' case that the Defendants have dishonestly adopted the name or the mark.
21. Even otherwise, the Defendants are not manufacturing or selling any items manufactured by the Plaintiff-Company. The only common item which could be shown was Polyester Resin. In my view, the undertaking given by Mr. Nair on behalf of his clients that the Polyester Resin would only be manufactured for personal consumption and would not be sold in the market under the mark "Reliance" is sufficient protection. This Undertaking is accepted. The Defendants are manufacturing sanitary wares. It is not the Plaintiffs' case that they or any of their group Companies are manufacturing sanitary wares. Thus there is no common filed of activity. As the "Reliance" is not synonymous with the Plaintiffs of their group Companies in all fields of activities, even a man of average intelligence and imperfect recollection would not confuse sanitary wares manufactured by Defendants to be those of Plaintiffs or of a Company associated with the Plaintiffs. The principles laid down in Kirloskar's case, (supra), would also not apply here because the word is not a household word associated with the Plaintiffs only. Further no question arises from protecting the public or public interest. If anything public interest requires that a big Company like the Plaintiffs be not allowed to flex its muscles and try and oust all others from use of a word which is a common word in English language and which is commonly used by a very large number of Companies/Firms in various fields of activities.
22. For all the above reasons in my view, the Plaintiffs are not entitled to any further or other reliefs at this stage. Accordingly, there will be no further or other Orders on this Notice of Motion. No Order as to costs.
23. Appeal dismissed.