Gauhati High Court
Green Valley Biscuit Pvt. Ltd. vs Madhabi Biscuit Pvt. Ltd. on 23 December, 2004
Equivalent citations: 2005(31)PTC438(GAU)
Author: D. Biswas
Bench: D. Biswas
JUDGMENT
D. Biswas, A.C.J.
1. This appeal is directed against the order dated 10.11.2003 passed by the learned District Judge, Sonitpur, Tezpur in MC No. 167/2002 arising out of title Suit No. 40/2002. By this order the learned District Judge vacated the ex parts ad interim, injunction order passed on 18.9.2002.
2. Heard Mr. S.L. Jain, learned Counsel for the appellant and Mr. A.R. Banerjee, learned Counsel for the respondent assisted by Mr. C.R. Bakshi and Ms. Bhumika Choudhury, learned Counsels.
3. The appellant Green Valley Biscuit Private Limited filed the aforesaid title suit for a decree for permanent injunction restraining the respondent M/s. Madhabi Biscuit Private Limited from passing off in any manner enabling others to sell biscuits bearing the trade mark "Cocktail" and for rendition of accounts of profit earned by the respondent by misusing the trade mark "Cocktail" of the appellant company.
4. According to the appellant, the respondent M/s. Madhabi Biscuit Private Limited with its registered office at Tezpur, Assam is also engaged in manufacture and marketing of biscuits of various kinds and brands like the appellant who has been manufacturing and marketing biscuits under principal trade mark/house mark "Society". The biscuits manufactured by the appellant are distributed and sold throughout the Eastern India including North East. Of the several trade marks introduced by the appellant, "Cocktail" is one of them in association with the principal trade mark "Society". The biscuits manufactured by the appellant enjoy goodwill and reputation. The trade mark "Cocktail" used by the appellant is very much established and well known to the customers. The appellant started to use the trade mark "Cocktail" in association with the trade mark "Society" since 1995 and has been the exclusive user thereof. This has been possible due to quality and extensive publicity undertaken by the appellant during the past several years. The appellant had applied for registration of the trade mark to protect the design of the biscuits under the Designs Act, 1911 (now substituted by the Designs Act, 2000) and the same has been registered accordingly. Since February 2001 the appellant noticed that the respondent company has also started using the mark "Cocktail" in combination with the word "Mother" on the top of their products in indistinctive manner. As a result, there is a passing off of the products by the respondent. The gravity of the situation led the appellant to issue cease and desist notice dated 2.3.2001 and 9.4.2001 to the respondent calling upon them to restrain from using the word "Cocktail" which is exclusively owned by the appellant as first adopter as well as first applicant under the provisions of the Trade and Merchandise Marks Act, 1958. The respondent, in reply dated 21.3.2001 and 25.5.2001, refused to stop the use of the trade mark "Cocktail". The respondent has been manufacturing and marketing biscuits under the trade mark "Cocktail" openly and extensively in and around Tezpur and Guwahati to the detriment of the business interest of the appellant. By this practice, the respondent has been successful in creating confusion in the trade and commerce misleading the customers. The respondent, according to the appellant, does not maintain quality and standard in their products and, therefore, is in a position to offer their products at a lower price luring the retailers and the customers. The use of the biscuits of the respondent company under the identical trade mark "Cocktail" has been a source of injury to the goodwill and reputation of the appellant company.
5. The respondent company in their written objection, apart from technical pleas, denied that the appellant's product had attracted huge number of customers. According to them, the appellant has no exclusive and monopolistic right in the word "Cocktail" and "Society" which are descriptive under Section 9 of the Trade and Merchandise Marks Act, 1958. According to them, there being no restriction under the provisions of the aforesaid Act, the respondents have every right to use the mark "Cocktail". The respondent has been using the said trade mark in their biscuits prior to the use of the said mark by the appellant. The respondent further denied that use of the trade mark "Cocktail" by them is calculated to cause confusion in the trade. According to them, there is no semblance of any overt act on their part to mislead the customers to believe that their products originate from the appellant company. According to them, the appellant do not have any right of exclusive use of the word "Cocktail" and, therefore, there is no question of invasion of their right by the respondent. It is further pleaded that the appellant company having no prima facie case will not suffer irreparable loss and the injunction issued at the pre-trial stage if maintained would prejudice the business interest of the respondent. According to them, for want of registration, the suit is barred under Sections 27 and 29 of the Trade Marks Act, 1999.
6. In case of an infringement of copyright, an injunction would normally be issued, while in an action for passing off the necessity of a prohibitory order would arise only on the existence of the factors relevant for this purpose. In Cadila Health Care Ltd. v. Cadila Pharmaceutical Ltd., , the Hon'ble Supreme Court held as follows:
"Broadly stated in an action for passing off on the basis of unregistered trade mark generally for deciding the question of deceptive similarity the following factors to the considered:
(a) The nature of the marks, i.e. whether the marks are word marks or label marks or composite marks, i.e. both words and label works;
(b) The degree of resemblances between the marks, phonetically similar and hence similar in idea;
(c) The nature of the goods in respect of which they are used as trade marks;
(d) The similarity in the nature, character and performance of the goods of the rival traders;
(e) The class of purchasers who are likely to buy the goods bearing the marks they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods;
(f) The mode of purchasing the goods or placing orders for the goods; and
(g) Any other surrounding circumstances which may be relevant in the extent of dissimilarity between the competing marks.
Weightage to be given to each of the aforesaid factors depends upon facts of each case and the same weightage cannot be given to each factor in every case."
7. Apart from above principles, the user of the mark prior in point of time than the impugned user is of utmost importance. The mere presence of mark in the register maintained by the Trade Marks Registrar does not prove its' user. Its expensive use has to be established by evidence. A striking similarity between the two is of course likely to create confusion resulting in deception. In such a case, an order of injunction is inevitable. The two trade names used by the rival parties have to be distinctively different to frustrate a prayer for injunction. It is, therefore, clear that the question whether two trade marks are likely to give rise to confusion or not is a matter of first impression.
8. The pleadings reproduced hereinbefore in a nutshell would show that the suit was not against infringement of a registered trade mark but for passing off action arising out of the use of the trade mark "Cocktail" by the respondent. Passing off being a common law remedy is in substance an action for deceit, i.e. passing off by a person of his own goods as those of another. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of his exclusive right of user of a trade mark in relation to his goods. Therefore, it has also to be assessed whether the products of the appellant company have become so popular that the retailers and the customers identify the products of the appellant marketed under the brand name "Cocktail" as that of the appellant company. According to the appellant, they have been using this mark since 1995 exclusively and the respondent is passing off their biscuits using the same mark "Cocktail" since February 2001 in combination with the word "Mother" in place of the word "Society" which is used by the appellant company.
9. The plaintiffs claim that they have been using this mark "Cocktail" in association with the word "Society" since 1995, while the defendant is using the word "Cocktail" from February 2001. The defendant in their pleadings submitted that they have been using the trade mark "Cocktail" in association with the word "Mother" prior to the use of the said mark "Cocktail" by the plaintiff-appellant. The order of the learned District Judge dated 10.11.2003 under challenge does show that no evidence has been led in this case to prove the claim of prior user by the parties except a few documents. The burden is on the plaintiff-appellant to show that they have been in use of the mark prior to the use by the defendant.
10. The word "Cocktail" used by both the parties, does not appear to be descriptive of the goods, i.e. biscuits in the instant case. Even the word "Cocktail" in association with the word "Society" or "Mother" does not render it relatable to the product, i.e. biscuits manufactured and marketed by the parties. The words "Society" and "Mother" used by the parties in their label prima facie suggest a degree of distinction though the first word "Cocktail" is phonetically same. The labels produced before this Court clearly indicate that they are distinguishable from one another in design, colour and shape. In the label of the respondent, the words have been written in block letters including the word "Cocktail". It is in small letters in the label of the plaintiff-appellant. The label of the defendant further shows that it has two logos embodied thereon. The first impression one can gather from these two labels is not of confusion but of distinction between the two. This is of course, a matter of first impression.
11. The learned District Judge in the impugned judgment observed that the sale figures of the appellant company does not appear to be impressive and that the claim of the appellant company with regard to reputation of the mark is a matter of fact to be proved by evidence. Under the circumstances, when prior user is in dispute and no evidence is available to resolve this prime issue, it would be difficult for this Court to say at this stage that the appellant has a cause to vindicate and that their right has to be protected by a prohibitory order. Prima facie, in the facts and circumstances of the case, it cannot be held that the defendant's use of the word "Cocktail" in association with the word "Mother" makes out a case of passing off.
12. Mr. A.R. Banerjee, learned Counsel for the respondent argued that till the evidence is led and the matter is heard, it would be a futile exercise to find out whether the defendant's use of the mark is with the dishonest intention to pass off his goods as those of the appellant. On the other hand, it has been argued on behalf of the appellant that the documentary evidence placed is adequate enough and, therefore, there cannot be a bar on the part of the Court to come to a decision in this matter. However, it has already been pointed out above that the prior user of the mark is in dispute and it can be resolved only when evidence is led. The burden is on the plaintiff-appellant to establish prior user in a passing off action. This Court after going through the labels used by the parties is of the opinion that these are distinctive enough for a man of average intelligence.
13. Mr. Banerjee further argued that the word "Cocktail" is in use from long before by one Meghraj Biscuit Industries Ltd. with the Registration No. 559447. According to him, the plaintiff-appellant is a pirator of the mark of the aforesaid company and, therefore, they cannot be favoured with a prohibitory order at this stage. In support of this argument, Mr. Banerjee referred to the documents on record wherefrom it is evident that the word "Cocktail" has been in use of the aforesaid company in association with the word "Snack" from long before. Mr. Banerjee further relied upon the decision in Prem Singh v. Ceeam Auto Industries, , in support of his arguments. In this judgment, the High Court held that a pirator of trade mark or copyright is not entitled to restrain another pirator from the use of the trade mark or copyright of third party which he himself has imitated or copied. In this connection, the observations of the Delhi High Court in para 29 of the aforesaid judgment is quoted below:
"29. The principles as to the rights of a person who comes before the Court with false claim of averment have been very explicitly discussed by the Division Bench of this Court in the case of Prima Chemical Works and Ors. v. Sukhdayal and Ors., , where it was emphasised that the whole action is based on principle of equity, and it is well established that he who comes into equity must come with clean hands and this applies strongly to parties seeking relief against the infringement of trade marks or in passing off action and against unfair competition because one seeking relief against fraud of others must be free from fraud, and that it was essential that the plaintiff himself should not be guilty of any false or misleading representation, and when the plaintiff makes any materially false statement in connection with the property which he seeks to protect, he loses his right to the assistance of a Court of equity."
14. There cannot be any different with the ratio available in the aforesaid judgment. The appellant does not appear to have a case in equity. The documentary evidenceon record is also not adequate enough to Judge prior user of the trade mark in dispute. First impression of the labels produced does not suggest resembleness. Besides, documents are on record to show that the word "Cocktail" is in use from before by Meghraj Biscuit Industries Ltd. The documents produced by the respondent also suggest that the appellant company is marketing their products under various trade names like Kitakat, Marry, etc. which are registered trade marks of other manufacturers. Under the circumstances narrated above, this Court is unable to hold that the plaintiff-appellant has succeeded in establishing a prima facie case of passing off of their goods by the respondent. In the considered opinion of the Court, the appellant have failed to establish prima facie their monopoly right over the trade mark to the exclusion of all others including the respondent. Therefore, this Court is not inclined to interfere with the impugned order passed by the learned District Judge.
15. In the result, the appeal is dismissed. The connected Miscellaneous Application No. 423 of 2004 also consequently stands dismissed. Registry is directed to transmit a copy of this order alongwith the records to the learned trial Court for expenditious disposal after giving both the parties opportunity to adduce evidence. The learned trial Court shall dispose of the suit without being influenced by any observation made hereinbefore.