Delhi District Court
Naresh Kumar Aggarwal vs M/S Bilal Traders on 8 July, 2010
In the Court of Shri Harish Dudani,
Additional District Judge15 (Central) : Delhi
T.M.No.04/10
Naresh Kumar Aggarwal .........Plaintiff
versus
M/s Bilal Traders ........Defendant
O R D E R
1. This is an application under order 39 rules 1 & 2 read with section 151 of the Civil Procedure Code dated 05.02.2010 filed by the plaintiff. The application arises out of the above noted suit for permanent injunction, passing off, infringement of copyright, claim for damages etc. Briefly stated the facts relevant for disposal of the application are as under:
2. The plaintiff has filed the above noted suit stating therein that the plaintiff is engaged in the business of manufacturing and selling paper articles including printed paper and gift wrapping paper for the last several years. In the year 2006, the plaintiff adopted a distinctive trade mark N.K. in respect of paper articles including printed paper & gift wrapping paper and immediately started using the same on the said goods on an extensive scale and on an exclusive basis. The said trade mark "N.K." in respect of the said goods has been T.M. No.04/10 1 continuously used by the plaintiff since the year 2006 without any interruption. The said trade mark "N.K." was coined by the plaintiff from his personal name "Naresh Kumar". The said trade mark "N.K." appears essentially and distinctively on all the products, brochures, catalogues, bill books, various advertisements & sales promotional schemes of the plaintiff. The said trade mark "N.K." of the plaintiff is being represented by the plaintiff in special and particular manner and font and the plaintiff claims a copyright over the said distinctive representation of the trade mark "N.K." The aforesaid goods of the plaintiff under the trade mark/trade name "N.K." have been sold extensively throughout the Republic of India. The annual sales of the plaintiff's aforesaid goods under the trade mark/trade name "N.K." run into several lakhs of rupees. The plaintiff has been extensively advertising its trade mark/trade name "N.K." through various print medias as well as through electronic media and the plaintiff has been spending huge amount on advertisement and sales promotional activities in order to promote its trade mark/trade name "N.K." in respect of aforesaid goods. The trade mark/trade name "N.K." of the plaintiff has become a wellrecognized mark in respect of its aforesaid goods due to excellent quality of goods sold under said trade mark and the customers identify and associate the goods marketed by the T.M. No.04/10 2 plaintiff under the trade mark/trade name "N.K." with the name of the plaintiff only. The plaintiff claims sole and exclusive proprietary rights over the aforesaid trade mark/trade name "N.K." by virtue of prior adoption coupled with prior, long, continuous, extensive and exclusive user for the last more than four years.
3. It is stated in the plaint that in third week of November 2009, the plaintiff came across a giftwrapping paper being manufactured and sold clandestinely by respondent bearing the violating trade mark "N.K.". The plaintiff immediately sent a cease and desist notice dated 17.11.2009 through his counsel to the defendant and the defendant through his counsel gave a false and frivolous reply dated 02.12.2009 to the said notice. The violating trade mark "N.K." of the defendant is visually, phonetically and structurally identical to the prior, established, reputed and wellknown trade mark "N.K." of the plaintiff in respect of identical goods namely gift wrapping paper. The representation of the violating trade mark "N.K." by the defendant on its goods namely gift wrapping paper is an exact replica of the plaintiff's representation on its aforesaid trade mark "N.K." The defendant has copied the infringing representation by keeping the plaintiff's aforesaid artistic representation before it. The adoption of the infringing artistic representation by the T.M. No.04/10 3 defendant on its product amounts to infringement of the plaintiff's proprietary rights with respect to its prior used artistic work/representation. The violating trade mark "N.K." as well as infringing copyright thereof by the defendant in respect of identical goods would result into confusion and deception in the mind of general public and in the trade as the respective goods of plaintiff under the trade mark "N.K." and those of the defendant under the violating trade mark "N.K." under the infringing copyright are likely to be sold in the same shops, over the same counters and to the same class of purchasers and it will put them into belief that the infringing goods of the respondent under the violating trade mark "N.K." are also originating and/or emanating from the plaintiff's manufacture or that the infringing goods of the defendant are also one of the varieties of the quality goods of the plaintiff or that the defendant are the licensees/affiliates/sister concern/branches of the plaintiff with respect to the violating trade mark "N.K." and the goods of the plaintiff are bound to be passed off as those of the plaintiff's. By way of application u/o 39 r 1 & 2 CPC, the plaintiff has prayed that during pendency of the suit, the defendant, its proprietors/partners, managers, servants, agents, dealers, stockists & representative be restrained from selling, offering for sale, advertising, promoting or otherwise T.M. No.04/10 4 dealing in paper articles including printed paper & gift wrapping paper and other similar/allied & cognate goods under the violating trade mark "N.K." and/or any other similar deceptively trade mark thereto and the defendant be restrained from infringing the copyright of the plaintiff with respect to the aforesaid artistic work of "N.K." (Label) and for restraining the defendant from passing off its goods in any manner as those of the plaintiff.
4. The defendant has filed written statement/reply to the injunction application and has contested the same. In the written statement, the defendant has taken objection that the suit is liable to be dismissed under order 7 rule 11 of CPC and the plaintiff has not approached the Court with clean hands. The defendant is the exclusive owner of the artistic work N.K. and the father of the proprietor of the defendant firm had got the artistic work of N.K. on 13.04.2004 and as such the defendant has the copyright over the trade name N.K. and he is the prior user of the same. It is denied that the plaintiff has the copyright over the said distinctive representation of the trade mark "N.K.". It is stated that the defendant is the owner of the artistic work of "N.K." and has got it developed much before the plaintiff's unauthorised usage of the same. It is stated that the defendant got design developed on 13.04.2004 and the defendant had paid full T.M. No.04/10 5 amount to the printer who got the artistic work designed. It is denied that the plaintiff is the prior user or exclusive user of trade mark/trade name "N.K.". It is also denied that trade mark/trade name "N.K." is associated exclusively with the plaintiff. The defendant is the owner of the trade mark/trade name "N.K." and exclusive copy right over the same and has been using the same much prior to the plaintiff and it is the plaintiff who has infringed the copyright and without taking due approval has started using the artistic work of the defendant. It is also denied that the trade mark/trade name "N.K." has become well recognized mark in respect of aforesaid goods due to excellent quality of the goods sold under the said trade name "N.K.". It is also denied that customers invariably identify and associate the goods by the plaintiff under the trade name "N.K." with the name of the plaintiff under trade name "N.K.". It is stated that the plaintiff has no right to use trade mark/trade name "N.K." which is under exclusive copyright of the defendant. It is stated that the application is liable to be dismissed.
5. The plaintiff has filed replication to the written statement of defendant. In the replication, the plaintiff has reiterated the contents of plaint and has controverted the allegations of the defendant as alleged in the written statement. In replication, the plaintiff has stated that WS filed by defendant has not T.M. No.04/10 6 been verified as per provisions of order 6 rule 15 (1) & (2) CPC. The defendant has not filed supportive affidavit alongwith WS verifying the contents of the WS as required under order 6 rule 15(4) CPC. It is denied that the defendant is exclusive owner of the artistic work regarding representation of "N.K.". It is denied that father of the defendant got the artistic work prepared on 13.04.2004. It is denied that the defendant got the impugned art work developed much prior to the plaintiff. It is also denied that the defendant got the impugned art work developed from the printer on 13.04.2004 or that the defendant allegedly paid any consideration to the said printer for designing and developing the impugned art work. It is stated that the trade mark "N.K." is associated exclusively with the name of the plaintiff by the trade channels and the purchasing public.
6. I have heard learned counsels for the parties and carefully gone through the record.
7. The case of the plaintiff is that the plaintiff has been using trade mark/trade name "N.K." continuously since the year 2006 and the same has been derived by the plaintiff from his personal name Naresh Kumar and the plaintiff has submitted the sales figures from the year 200607 to till date and the plaintiff has been spending a huge amount on the advertisement of his trade mark "N.K.". In the written T.M. No.04/10 7 statement the plea which has been taken by the defendant is that the defendant got the artistic work of "N.K." prepared on 13.04.2004 and since then the defendant has been using the same continuously and the defendant is the prior user and adopter of the trademark/trade name "N.K." and that the defendant is also the copyright holder in respect of the presentation of the said trade mark/trade name "N.K." as the defendant got the same created and on account of prior user.
8. For seeking relief of injunction, the plaintiff is required to prove that the plaintiff has a primafacie case in his favour, balance of convenience lies in favour of the plaintiff and the plaintiff shall suffer irreparable loss and injury if inunction is not granted.
9. Section 34 of the Trade Marks Act,1999 reads as under : "34. Saving for vested rights. Nothing in this Act shall entitle the proprietor or an registered user of registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods or services in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date prior
(a) to the use of the firstmentioned trade mark in relation to those goods or services by the proprietor or a predecessor in title of his; or
(b) to the date of registration of the first mentioned trade mark in respect of those goods or services in the name of the proprietor of a predecessor in title of his;
T.M. No.04/10 8
whichever is the earlier, and the Registrar shall not refuse (on such use being proved), to register the second mentioned trade mark by reason only of the registration of the first mentioned trade mark.
10. Section 35 of Trade Mark Act, 1999 provides that priority of use prevails as compared to registration and it lays down that ordinarily it is the prior user of the trade mark who is the owner of trade mark.
11. In Century Traders Vs. Rohan Lal Duggar & Co. & Others 1978 Delhi 250, reference was made to Consolidated Foods Corporation vs. Brandon and Co. Private Ltd., AIR 1965 Bom 35 wherein it was observed : "12. A trader acquires a right of property, in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. The trader who adopts such a mark is entitled to protection directly the article having assumed a vendible character is launched upon the market. Registration under the statute does not confer any new right to the mark claimed or any greater rights than what already existed at common law and at equity without registration. It does, however, facilitate a remedy which may be enforced and obtained throughout the State and it established the record of facts affecting the right to the mark. Registration itself does not create a trade mark. The trade mark exists independently of the registration which merely affords further protection under the Statute. T.M. No.04/10 9 Common law rights are left wholly unaffected. Priority in adoption and use of a trade mark is superior to priority in registration.
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14. Thus, the law is pretty well settled that in order to succeed at this stage the appellant had to establish user of the aforesaid mark prior in point of time than the impugned user by the respondents. The registration of the said mark or similar mark prior in point of time to user by the appellant is irrelevant in an action for passing off and the mere presence of the mark in the register maintained by the trade mark registry did not prove its user by the persons in whose names the mark was registered and was irrelevant for the purposes of deciding the application for interim injunction unless evidence had been led or was available of user of the registered trademarks.
12. In N. R. Dongre & others. vs. Whirlpool Corporation and others, AIR 1995 Delhi 300, it was held that :
"29. Thus the right created by Section 28(1) of the Act in favour of a registered proprietor of a trade mark is not an absolute right and is subservient to other provisions of the Act namely Sections 27(2), 33 etc. Neither Section 28 nor any other provision of the Act bars an action for passing off by an anterior user of a trade mark against a registered user of the same. In other words registration of a trade mark does not provide a defence to the proceedings for passing off as under
Section 27(2) of the act a prior user of trade T.M. No.04/10 10 mark can maintain an action for passing off against any subsequent user of an identical trade mark including a registered user thereof. Again this right is not affected by Section 31 of the Act, under which the only presumption that follows from registration of a mark is its prima facie evidentiary value about its validity and nothing more. This presumption is not an unrebuttable one and can be displaced. Besides Section 31 is not immune to the overriding effect of Section 27 (2)."
"The rights of action under Section 27(2) are not affected by Section 28(3) and Section 30 (1)(d). Therefore, registration of a trade mark under the Act would be irrelevant in an action for passing off. Registration of a trade mark in fact does not confer any new right on the proprietor thereof than what already existed at common law without registration of the mark.
The right of good will and reputation in a trade mark was recognized at common law even before it was subject of statutory law. Prior to codification of trade mark law there was no provision in India for registration of a trade mark. The right in a trade mark was acquired only by use thereof. This right has not been affected by the Act and is preserved and recognized by Sections 27(2) and 33."
13. In Bimal Govindji Shah vs. Panna Lal Chandu Lal, 1997 PTC (17) 347 it was held that :
9."..............................Thus a conjoint reading of the aforesaid provisions persuaded me to conclude on a reading of the aforesaid provisions conjointly the T.M. No.04/10 11 natural deduction is that the right conferred by Section 28(1) of the Act in favour of a registered proprietor of a trade mark is not an absolute right but is subject to the other provisions of the Act namely Section 27(2) and 33. It is also to be noted that neither Section 28 nor any other provision of the Act prohibits an action for passing off by an anterior user of a trade mark against a registered user of the same. In other words registration of a trade mark does not provide a defence to the proceedings for passing off as provided for under Section 27(2) of the Act. A prior user of a trade mark is entitled to maintain an action against a subsequent user of identical trade mark including registered user thereof.
14. As per aforesaid judgements, it is well settled that registration is irrelevant in case of passing off and a prior user of trade mark is entitled to maintain an action against the subsequent user of identical trade mark including registered user thereof.
15. The plea as raised by the plaintiff is that the plaintiff has been using the trade mark/trade name "N.K." since the year 2006. While in the written statement, the plea which has been by the defendant is that they have been using trade mark/trade name "N.K." since the year 2004 continuously. The contention of the learned counsel for the plaintiff is that the defendant has not been able to substantiate its claim of user of trade mark/trade name "N.K." since the year 2004 as the T.M. No.04/10 12 defendant has filed on record invoices commencing from 19.06.2009 and the same do not establish that the defendant has been using the same since the year 2004.
16. In order to substantiate its contention that the defendant has been using the trade mark/trade name "N.K." since the year 2004, the defendant has filed on record copies of tax invoices which are from 19.06.2009 to 02.12.2009. The tax invoices which have been filed on record by the defendant do not establish the defendant is using trade mark/trade name "N.K." since the year 2004 as claimed by the defendant. It is to be noted that in page 3 of preliminary objections of written statement, the defendant has stated that father of the proprietor of the defendant firm had got the artistic work "N.K." prepared on 13.04.2004. In para 4 of the reply on merits of written statement, the defendant has stated that the defendant got the design developed on 13.04.2004 and the defendant paid the full amount to the printer who got the artistic work designed. Alongwith written statement, the defendant has filed affidavit of Shri Zamiluddin partner of M/s Bilal Traders and in the said affidavit Shri Zamiluddin has stated that he is one of the partners of the defendant firm. In the written statement, the defendant has not stated that the defendant is a partnership firm and if it is a partnership firm then who are partners. Rather in para 3 of preliminary T.M. No.04/10 13 objections of written statement, the defendant has stated that the artistic work of "N.K." was got prepared by father of proprietor of defendant. The defendant has also filed one certificate which is signed by partner of M/s Bilal Traders whereby Shri Zamiluddin parter of M/s Bilal Traders has been authorised to sign the document, depose, file the affidavit and to do all the conducts necessary to contest the present case. On one hand, in written statement, the defendant has pleaded that the artistic work of the "N.K." was got prepared by father of the proprietor of defendant, but in the documents which have been filed on record, the defendant has claimed that it is a partnership firm. The defendant has filed income tax returns filed by Shri Jalaluddin, proprietor of M/s Bilal Traders for the assessment years 200102 to 200607. The said income tax returns which have been filed on record show that said M/s Bilal Traders is a proprietary concern of Shri Jalaluddin. In the written statement, the defendant has omitted to mention that it is a proprietary concern or partnership firm and if it is partnership firm then who are the partners thereof and since when the said partnership is in existence. Moreover, the copies of the income tax returns which have been filed by Shri Jalaluddin as proprietor of M/s Bilal Traders since the assessment years 200102 do not prove that the defendant has been using trade mark "N.K." T.M. No.04/10 14 since the year 2004 as claimed by the defendant in its written statement. The defendant has also filed on record copy of one invitation card in respect of Walima Ceremony of Shri Zameer Uddin with Ms. Shabnam Yusuf in order to show that NK Wrap Bilal Traders was in existence on the day of said Walima Ceremony and on the first page of said invitation card it is mentioned that Walima Ceremony is as per programme and on the second page programme is mentioned as on th Tuesday the 27 December 2005 and on the second page below programme Aqiqa Ceremony of Mian Umardin & Baby Yusra is mentioned. The copy of the invitation card which has been filed on record by the defendant in respect of Walima and Aqiqa ceremonies does not prove that the defendant has been carrying on business under trade mark/trade name "N.K." since the year 2004.
17. The defendant has filed on record a copy of presentation of the artistic work of "N.K." which is allegedly signed by Shri Salauddin on 13.04.2004. The contention of learned counsel for the defendant is that the said artistic work was prepared by Shri Salauddin on 13.04.2004. However, learned counsel for the plaintiff has contended that in the written statement, it is no where mentioned that artistic work in respect of "N.K." was prepared by Shri Salauddin on13.04.2004 and the said document cannot be looked into and the defendant has also T.M. No.04/10 15 not proved that there has been assignment of said artistic work by Shri Salauddin in favour of the defendant by virtue of any assignment deed in terms of 19 of The Copyright Act, 1957. It is to be noted that in page 3 of preliminary objections of written statement, the defendant has only mentioned that father of proprietor of defendant got the artistic work of "N.K." prepared on 13.04.2004 and in para 4 of the reply on merits of written statement, the defendant has mentioned that copy of the artistic work and bill of the printer is submitted along with the written statement. But no such bill issued by any printer has been filed on record.
18. As per section 19 (1) of The Copyright Act, 1957 no assignment of the copyright in any work shall be valid unless it is in writing signed by the assignor or by his duly authorised agent. As per section 19 (2) of The Copyright Act, 1957 the assignment of copyright in any work shall identify such work, and shall specify the rights assigned and the duration and territorial extent of such assignment. As per section 19 (3) of The Copyright Act, 1957 the assignment of copyright in any work shall also specify the amount of royalty payable, if any, to the author or his legal heirs during the currency of the assignment and the assignment shall be subject to revision, extension or termination on terms mutually agreed upon by the parties.
T.M. No.04/10 16
19. Although in written statement, the defendant has pleaded that father of proprietor of defendant got artistic work of "N.K." prepared on 13.04.2004 and the defendant has filed a copy of presentation of "N.K." which is allegedly signed by one Shri Salauddin on 13.04.2004 but the defendant has not filed on record any assignment deed in terms of section 19 of The Copyright Act, 1957.
20. Although, the defendant has pleaded in written statement that the defendant has been using the trade mark/trade name "N.K." since the year 2004, but the defendant has not submitted any sales figures to substantiate its contention that the defendant has been trading under mark "N.K." and the defendant is having sufficient sales under said trade mark. The defendant has also not filed any publicity material which was issued by the defendant in order to publicise its products under trade name "N.K.". The defendant has not mentioned in written statement that they have spent any amount on the publicity of their mark "N.K."
21. In the plaint, the plaintiff has mentioned the sales figures of its goods under trade mark/trade name "N.K." since the year 200607 to 200910. The plaintiff has also filed on record Profit & Loss Account of M/s NK Enterprises for the year ending 31.03.2007, Balance Sheet as on 31.03.2007, Trading Profit & Loss Account for the year ending 31.03.2008, T.M. No.04/10 17 Balance Sheet as on 31.03.2008, Balance Sheet as on 31.03.2009 and Trading & Profit & Loss Account for the year ending on 31.03.2009. The plaintiff has also filed on record advertisements published by plaintiff in newspapers under trademark "N.K.". The contention of learned counsel for the defendant is that advertisement which have been filed by plaintiff on record are from September 2009. It is to be noted that the plaintiff has filed newspapers containing advertisements of the plaintiff published in the month of September 2009 and October 2009. However, the defendant has not filed any advertisement on record in order to prove that they have been spending any amount on the advertisement of their trademark. Moreover, documents filed by defendant on record do not prove that the defendant is prior adopter and user of trade mark "N.K.".
22. As per aforesaid discussion, the mark adopted by both the parties "N.K." is in respect of the same goods i.e. paper articles including printed papers & gift wrapping papers and the defendant has not succeeded in proving that the defendant adopted mark "N.K." prior to plaintiff.
23. In Power Control Appliances and others v. Sumeet Machines, Pvt. Ltd. and others, 1995PTC165 it was held that it is a settled principle of law relating to trade mark that there can be only one mark, one source and one proprietor. T.M. No.04/10 18
24. The comparison of presentation of the mark i.e. "N.K." by both parties show that trademark/trade name "N.K." is being presented by both the parties in identical manner. Although, the defendant has pleaded that below trademark "N.K." they have written word WRAP and in mark of plaintiff there are thin lines below the mark "N.K." and there is distinction between the two. In order to compare the two marks the same are not to be kept side by side in order to find the finer distinctions between the two marks. The distinction in the two marks is to be seen from the point of view of person of average intelligence of ordinary prudence with imperfect recollection. In the circumstances the person who sees both the marks would not be able to distinguish between two marks and is likely to be deceived in believing that origin of both marks is from the same source. The plaintiff has succeeded in proving its prior adoption and use of mark "N.K." in particular font in which said mark is being represented. Moreover, the defendant has not succeeded in proving that they got copyright work in respect of mark NK prepared in the year 2004 and the same was assigned to the defendant. The plaintiff has succeeded in proving that a prima facie case in its favour. The balance of convenience also lies in favour of the plaintiff as it is the plaintiff who shall be put to inconvenience if injunction is not granted. It is the T.M. No.04/10 19 plaintiff who shall suffer irreparable loss and injury in case the injunction is not granted. Accordingly, the defendant, its partners/proprietors, dealers, distributors, agents, stockists and all other persons acting on behalf of the defendant are restrained from selling, offering for sale, advertising, promoting or otherwise dealing in paper articles including printed paper and giftwrapping paper and other similar/allied and cognate goods under trade mark "N.K." and also from infringing the copyright of the plaintiff with respect to the artistic work of "N.K." ( Label). Application under order 39 rule 1 & 2 CPC stands disposed of accordingly. However, nothing in this order shall be deemed to be an expression on the merits of the case.
(Announced in the open
court on 8th July, 2010) (HARISH DUDANI)
Addl. Distt. Judge15 (Central)
Delhi
T.M. No.04/10 20