Kerala High Court
K.A.Moideen Haji vs Santhigiri Ashramam on 26 February, 2009
Author: M.Sasidharan Nambiar
Bench: M.Sasidharan Nambiar
IN THE HIGH COURT OF KERALA AT ERNAKULAM
AS.No. 3 of 1993(D)
1. K.A.MOIDEEN HAJI
... Petitioner
Vs
1. SANTHIGIRI ASHRAMAM
... Respondent
For Petitioner :SRI.M.RAJASEKHARAN NAYAR
For Respondent :SRI.K.P.DANDAPANI (SR.)
The Hon'ble MR. Justice M.SASIDHARAN NAMBIAR
Dated :26/02/2009
O R D E R
M.SASIDHARAN NAMBIAR,J.
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A.S.NO. 3 OF 1993
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Dated this the 26th day of February,2009
JUDGMENT
First defendant in O.S.2/1986 on the file of District Court, Thiruvananthapuram is the appellant. On the death of the appellant additional appellant was impleaded as his legal heir. Later respondents 2 to 6 were also impleaded as other legal heirs of deceased appellant. Original respondent is the plaintiff in the suit, an institution by name "Santhigiri Ashramam" registered under the Travancore Cochin Literary, Scientific and Charitable Societies Act. Suit was filed for a declaration that first respondent is the exclusive owner of trade name "Santhigiri" and for a permanent prohibitory injunction restraining defendants from using the trade mark 'Santhigiri' in the name of the A.S. 3/1993 2 institutions sign boards, Bills, Vouchers, Labels etc. The allegations in the plaint are that late Karunakara Guru founded Santhirigiri Ashramam 25 years back for the upliftment and spiritual development of man and the Ashram is at Koliyakode in Thiruvananthapuram and it has branches at Palarivattom (Ernakulam District) and Kallar (Idukki District) and Sultan Battery (Wayanad District) and new branches are being established. Santhigiri Ashram was registered as an institution under the Tranvancore-Cochin Literary, Scientific and Charitable Societies Act and the Ashram has multifaced activities in the spiritual, Educational, Medical and Women's Welfare Activities and Koliyakode is the seat of the Guru. Santhigiri Vidhya Bhavan a residential English Medium School, Santhigiri Engineering and Construction Company, Santhigiri Mathrumandalam, Santhigiri Ayurveda Vaidyasala are all being run by Santhigiri Ashramam. It is also alleged that an A.S. 3/1993 3 Ayurvedic Hospital Complex at an estimated cost of Rs.28 lakhs is nearing completion at Koliyakode with the financial assistance of South Indian Bank and Santhigiri Hospital cum Research Centre for doing research in Ayurvedic, Homeo, Naturopathy and Sidha Systems of medicine are being started at the Hospital Complex. Santhigiri Vaidyasala products carry a special label with letters "Santhigiri Ayurveda Vaidyasala" on top and Santhigiri Ashram with the address "Koliyakode P.O., Venjaramoodu, Trivandrum. First respondent specifically pleaded that Santhigiri is the trade mark designed and used by the Ashram for the last more than 8 years prior to the institution of the suit in the medical field and it is the exclusive property and the name has distinctive feature of its own so that Santhigiri has became a trade name of mark of Santhigiri Ayurveda Vaidyasala products and services. Defendants have published an advertisement regarding the Santhigiri Health Complex to be A.S. 3/1993 4 inaugurated by the Minister at Kalamasseri on 2.2.1986. It is contended that the use of the word Santhigiri was given with malicious intention of passing off the institution and services and products of first respondent Ashram and it was to deliberately mislead the public and if they are allowed to use the trade name Santhigiri to their institution, it will pass off the place of treatment and services of the first respondent and therefore a decree is to be granted.
2. Defendants in the joint written statement contended that first respondent has no registered trade mark and respondent Ashram has not acquired any trade name Santhigiri and the labels used by first respondent for their medical products cannot be treated as a trade mark and based on that usage first respondent is not entitled to institute the suit. It was also contended that defendants have started Santhigiri Health Complex at Kalamassery and the name of the Health Complex was given after A.S. 3/1993 5 its place where it is situated and the rooms of the Health Complex building are let out by the appellant to persons who come over there for treatment and second defendant is the person in control of the medical treatment and the Health Complex is not preparing any kind of medicine and all the medicines used are the one prepared by the second defendant in his P.N.V.M. Hospital and there is no passing off the business or services of the first respondent and therefore the suit is only to be dismissed.
3. Learned District Judge on the evidence of Pws. 1 to 3 and Exts.A1 to A60 found that the term Santhigiri has been used by the first respondent in the name of Vydhyasala and also labels of its medicines and it is the use the said trade name and first respondent is therefore entitled to the protection for the use of that trade name. Finding that defendants started using the same trade name for their Health Complex, it was held A.S. 3/1993 6 that if the defendants are allowed to use the name Santhigiri for the Health Complex and allied business, it would amount to passing off the name, good will and reputation of the respondent and granted a decree declaring that first respondent is the exclusive owner of the trade name Santhigiri and restraining defendants by a permanent prohibitory injunction from using the trade name or mark Santhigiri in their Signboards, Bills, Vouchers, Labels and Designs or Symbols. The decree is challenged in this appeal.
4. Learned counsel appearing for the appellant and the contesting respondents were heard.
5. Learned counsel appearing for the appellant pointed out that the suit was instituted as if first respondent has got a right to use the trade name Santhigiri. It is admitted case that no such trade name was registered in favour of the first respondent. It was argued that the case of the first respondent is that Karunakara Guru A.S. 3/1993 7 established Santhigiri Ashram and it is a society registered under the Travancore Cochin Literary Scientific and Charitable Societies Act and thereafter a Vydhyasala by name Santhigiri Vydhyasala which started manufacturing ayurvedic medicines and later schools and other establishments in the name Santhigiri were started and as no such trade mark or trade name was registered as provided under the Trade and Merchandise Marks Act,1958, first respondent is not entitled to seek a decree based on the trade mark. Learned counsel relying on the decision of the Apex Court in S.M.Dyechem Ltd v. Cadbury (India) Ltd (2000) 5 SCC 573), K.Narayanan and another v. S. Murali (2008) 10 SCC 479), and Durga Dutt Sharma v. N.P.Laboratories (AIR 1965 SC 980) argued that the learned District Judge did not properly appreciate the case or decide the question and therefore the decree is not sustainable. Learned counsel also argued that evidence of PW1 A.S. 3/1993 8 establish that the only similarity is usage of the name Santhigiri by the appellant as the name is Santhirigi Hospital Complex and PW1 himself admitted that that Hospital Complex is known as P.N.V.M Santhigiri Hospital Complex which cannot be deceptively similar to the name used by the first respondent viz Santhigiri Ashram or Santhigiri Ayurvedic Medicines or Engineering Schools. It is therefore argued that the decree is only to be set aside. Learned counsel also pointed out that apart from the evidence of PW1, there is no evidence to prove that any person mistook the Ayurvedic Hospital Complex run by the appellant as an Institution run by the first respondent and as appellant is not manufacturing any medicines and are only using the medicine prepared by P.N.V.M. Hospital and therefore there is no passing of the business of the first respondent and therefore learned District Judge should not have granted the decree.
A.S. 3/1993 9
6. Learned counsel appearing for first respondent argued that fact that Karunakara Guru established Santhigiri Ashram and Santhigiri Ashram is running a Santhigiri Ayurveda Vydhyasala, Santhigiri Engineering and Construction Company, Santhigiri Vidhyabhavan and Santhigiri Medical Supplies as found by the learned District Judge is not disputed and therefore the fact that first respondent has been using the trade name Santhigiri previous to the use by the appellant is admitted and though the trade mark or trade name is not registered, as provided under sub section (2) of Section 27 of the said Act, the fact that trade mark is unregistered does not affect the right of action against the appellant for passing of goods, as the goods of another person or seeking remedies in respect thereof and therefore the suit is maintainable. The learned counsel also argued that defendants did not adduce any evidence and the evidence of first respondent establish that the A.S. 3/1993 10 word Santhigiri is being used as the trade name by first respondent eight years prior to the institution of the suit and therefore defendants cannot use the same trade name Santhigiri which is deceptively similar to the one which is being used by the first respondent and therefore learned District Judge rightly granted the decree. Learned counsel relied on the decision of the Apex Court in S.M.Dyechem Ltd v. Cadbury (India) Ltd (2000) 5 SCC 573, Parle Products (P) Ltd v. J.P. & Co. Mysore (AIR 1972 SC 1359) and Dhariwal Industries Ltd v. M.S.S. Food Products (2005 (3) SCC 63) and N.R.Dongre and others v. Whirlpool Corporation and another (1996) 5 SCC 714) and argued that the decree granted is perfectly legal and correct.
7. Section 28 of the Trade & Merchandise Marks Act, 1958 provides the rights conferred by registration of a trade mark and Section 29 provides for action for infringement of trade marks. Under sub section (1) of Section 27, no A.S. 3/1993 11 person shall be entitled to institute any proceeding to prevent, or to recover damages for, the infringement of an unregistered trade mark. But sub section (2) explicitly makes it clear that nothing in Section 27 shall be deemed to affect the rights of action against any person for passing off goods as the goods of another person or the remedies in respect thereof. Therefore reason that a trade mark or trade name is not registered as provided under the Act is not a bar for an action for passing off goods as the goods of another person. An action for infringement of a trade mark and an action for passing off are different and distinct. The right for an action for passing off is not a statutory right but a common law right.
8. The necessary elements of an action for passing off restated by the House of the Lords in Erven Warnink BV v. J.Townend & Sons (Hull) Ltd (1979 ) A.C. 731) was quoted by the Division Bench A.S. 3/1993 12 of this Court in Preme v. Ambujakshan (2006(1) KLT
905) as follows:-
"1. that the plaintiff's goods or services have acquired a goodwill or reputation in the market, and are known by some distinguishing feature.
2. that there is a misrepresentation by the defendant (whether or not intentional) leading or likely to lead the public to believe that the goods or services offered by the defendant are goods or services of the plaintiff; and
3. that the plaintiff has suffered or is likelyto suffer damage as a result of the A.S. 3/1993 13 erroneous belief engendered by defendant's misrepresentation. To establish a likelihood of deception or confusion in an action for passing off where there has been no direct misrepresentation generally requires the presence of two factual elements:-
i) that a name, mark or other distinctive feature used by the plaintiff has acquired a reputation among a relevant class of persons; and
ii) that members of that class will mistakenly infer from the defendant's use of a name, mark or other feature which is the same or sufficiently similar that the defendant's goods or business are A.S. 3/1993 14 from the same source or are connected.
9. Apex Court in National Sewing Thread Co.Ltd, Chidambaram v. James Chadwick and Bros (A.I.R.1953 SC 357) laid the law that the onus in a passing off action rests on plaintiff to prove whether there is likelihood of the defendants goods being passed off as the goods of the plaintiffs and the considerations relevant in a passing off action are somewhat different than they are in an application made for registration of a mark under the Trade Marks Act.
10.In Kaviraj Pandit Durga Dutt Sharma v. N.P. Laboratories (A.I.R.1965 SC 980 ) considering an action for passing off Apex Court held:-
"While an action for passing off is a Common Law remedy being in substance an action for deceit, that is, a passing off by a person of A.S. 3/1993 15 his own goods as those of another, that is not the gist of an action for infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of "the exclusive right to the use of the trade mark in relation to those goods."
(Vide S.21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for infringement. No doubt, A.S. 3/1993 16 where the evidence in respect of passing off consists merely of the colourable use of a registered trade mark, the essential features of both the actions might coincide in the sense that what would be a colourable imitation of a trade mark in a passing off action would also be such in an action for infringing of the same trade mark. But there the correspondence between the two ceases. In an action for infringement the plaintiff must, no doubt, make out that the use of the defendant's mark is likely A.S. 3/1993 17 to deceive, but where the similarity between the plaintiffs and the defendants mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is an imitation, no further evidence is required to establish that the plaintiff's rights are violated. Expressed in another way, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the A.S. 3/1993 18 goods or on the packet in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark would be immaterial;
whereas in the case of passing off, the defendant may escape liability if he can show that the added matter is sufficient to distinguish his goods from those of the plaintiff."
The fact that neither the plaintiff nor the defendant has a registered trade mark as on the date of the suit cannot stand in the way of entertaining the claim of the plaintiff in a passing off action. (See 2005(3) SCC 63). So also A.S. 3/1993 19 the fact that as the trade mark was subsequently registered in the name of the defendant will not defeat an action for passing off by the plaintiff.
11. Apex Court in S.M.Dyechem Ltd v. Cadbury (India) Ltd (2000) 5 SCC 573 considering the difference of an action for passing off an infringement held:-
48. Here the point is in relation to relative strength of the parties on the question of "passing off". As discussed under Point 5, the proof of resemblance or similarity in case of passing off and infringement are different. In a passing off action, additions, get-up or trade-dress might be relevant to enable the defendant to escape. In infringement cases, such facts do not assume A.S. 3/1993 20 relevance. (See Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, Ruston & Hornsby Ltd. v.
Zamindara Engg.Co and Wander Ltd. v. Antox India (P) Ltd.
49. It is possible that, on the same facts, a suit for passing off may fail but a suit for infringement may succeed because the additions, the get-up and trade-dress may enable a defendant to escape in passing off action. A somewhat similar but interesting situation arose in a dispute between two companies. In National Sewing Thread Co.Ltd v. James Chadwick & Bros. Ltd, the A.S. 3/1993 21 passing off action failed.
But thereafter James Chadwick Co. succeeded in an appeal arising out of the registration proceedings and the said judgment was confirmed by this Court in National Sewing Thread Co.
Ltd. v. James Chadwick & Bros Ltd. It was held that the judgment in the passing off case could not be relied upon by the opposite side in latter registration proceedings.
50. In the same tone, Halsbury (Trade Marks, 4th Edn., 1984, Vol.48, para 187) says that in a passing off action their "degree of similarity of the A.S. 3/1993 22 name, mark or other features concerned is important but not necessarily decisive, so that an action for infringement of a registered trademark may succeed on the same facts where a passing off action fails or vice versa"
As to vice versa, Kerly says (para 16.12) an infringement action may fail where the plaintiff cannot prove registration or that its registration extends to the goods or to all the goods in question or because the registration is invalid and yet the plaintiff may show that by imitating the mark or otherwise, the defendant has A.S. 3/1993 23 done what is calculated to pass off his goods as those of the plaintiff."
12. The dispute in the case is to be settled in the light of the settled legal position.
13. What was claimed by the first respondent in the plaint is that " Santhigiri is the trade mark designed and used by the plaintiff for the last more than eight years in the medical field and it is exclusively its property. This name has a distinctive feature of its own so much so Santhigiri has become a trade name of mark of Santhigiri Ayuveda Vydhayasala products and services." Learned District Judge relying on the evidence of PW1 and Exts.A1 to A60 found that the term Santhigiri is used by the first respondent in the name of its Vydhyasala and labels of its medicines and thus it is made the trade name and first respondent is entitled to protection of the use of that trade name.
A.S. 3/1993 24
14. Though PW1 has given evidence in support of the claim of the first respondent, his evidence do not establish that first respondent had acquired a right in the trade name Santhigiri. The pleadings and the evidence show that Karunakara Guru founded an Ashram at Pothencode which was later shifted to Koliyakkode and the name of the Ashram was Santhigiri Ashram. Evidence would also establish that Santhigiri Ashram is registered evidenced by Ext.A1, under the Travancore Cochin Literary, Scientific and Charitable Societies Act. Evidence also establish that subsequently Ashram widened its activities on education, medical and women welfare activities. It is in evidence that a residential English Medium School Santhigiri Vidhyabhavan, an Engineering Construction Company by name Santhigiri Engineering and Construction Company and a Hospital Complex by name Santhigiri Hospital and Research Centre was under the construction, A.S. 3/1993 25 at the time of institution of the suit which was later started functioning. Evidence also establish that Santhigiri Ayurveda Vydhyasala started manufacturing medicines in the name Santhigiri Vydhyala and thereafter started Santhigiri Medical Supplies for the supply of medicines. The evidence do not establish that first respondent had used the trade name "Santhigiri". On the other hand, evidence only establish that along with the name Santhigiri first respondent named the institution whether it is a Vydhyasala or educational institution or Engineering Company. The question is whether by such usage, it could be said that first respondent had a right for the exclusive use of the word Santhigiri and if that be so, whether the starting of a Hospital Complex by name Santhigiri Health Complex by the defendants would amount to passing off the business or the service of the first respondent.
A.S. 3/1993 26
15. As stated earlier, eventhough the proof of resemblance or similarity in a case of infringement is not relevant, that is not the case with an action for passing off. A suit for passing off may fail, if there is difference in the get-up and trade-dress, though it may not be a defence in an action for infringement of the trade mark. If defendant could establish that the usage of additional words distinguishes it from the other, it would be a relevant factor in an action for passing off, though it is not relevant in an action for infringement of the trade mark. But if the additions are sufficient enough to prevent it from being sold as the other it would be sufficient to non-suit the plaintiff in an action for passing off. Unfortunately this distinction was not taken note of by the learned District Judge.
16. Ext.A32 the paper publication of the inauguration of the Hospital Complex by the A.S. 3/1993 27 appellant in the name of Santhigiri Hospital Complex itself establish that anybody seeing the name would realise that it is not a branch or concern of the Santhigiri Ashram but a sister concern of P.N.V.M. Hospital. PW1 himself admitted that the Board of the appellant is to the effect that it is the sister concern of P.N.V.M. Hospital. Therefore when the first respondent is running a Hospital Complex, though in the name of Santhigiri Hospital Complex, making it clear that the hospital is not part of the Santhigiri Ashram but a sister concern of P.N.V.M. Hospital an entirely different concern of reputation it cannot be said that service in the hospital of the appellant is being passed off as that of the first respondent. This distinctive fact is sufficient to hold that first respondent is not entitled to the decree granted by the learned District Judge. When the evidence do not establish that first respondent has any exclusive A.S. 3/1993 28 right in the name Santhigiri learned District Judge was not justified in granting a declaration to that effect. Evidence only establish that first respondent is having an Ashram by name Santhigiri and is also running Vydhyasala and School all suffixing the name with Santhigiri before the name of the respective institution. But that will not give an exclusive right like a trade mark or trade name to the first respondent. Therefore the decree granted by the learned District Judge is not sustainable.
Appeal is allowed. The decree and judgment passed in O.S.2/1986 by District Judge, Thiruvananthapuram is set aside. O.S.2/1986 stands dismissed. No cost.
M.SASIDHARAN NAMBIAR JUDGE tpl/-
M.SASIDHARAN NAMBIAR, J.
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A.S.NO.3 /1993
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JUDGMENT 26th FEBRUARY,2009