Calcutta High Court
Srmb Srijan Private Ltd vs Super Smelters Ltd. & Ors on 30 September, 2019
Equivalent citations: AIRONLINE 2019 CAL 657
Author: Bibek Chaudhuri
Bench: Bibek Chaudhuri
ORDER SHEET
G.A. No. 2127 of 2019
G.A. No. 1 of 2019
With
C.S. No. 192 of 2019
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Jurisdiction
ORIGINAL SIDE
SRMB SRIJAN PRIVATE LTD.
VERSUS
SUPER SMELTERS LTD. & ORS.
BEFORE:
The Hon'ble JUSTICE BIBEK CHAUDHURI
Date : 30th September, 2019.
Appearance:
Mr. Ranjan Bachawat, sr. Adv.
Mr. R. Bhattacharya, Adv.
Mr. Ratnanko Banerjee, sr. Adv.
Mr. Debnath Ghosh, Adv.
The Court: C.S. No. 192 of 2019 is filed by the plaintiff/petitioner
praying for the following reliefs:-
"(a) A decree for permanent injunction restraining the Defendants,
its assigns, directors, partners, employees, agents and others acting on its
behalf from manufacturing, marketing, selling products including TMT
bars and rods by applying pattern of X ribs mark/pattern/get up/trade
dress upon or in relation to the TMT bars and rods as depicted in
Annexure "A" or any other colourable imitation of the same including the
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one which is depicted in Annexure "H" to the plaint or any other TMT bar
containing similar pattern depicted on the TMT bars;
(b)Decree of permanent injunction restraining the Defendants from
advertising in any manner any product including TMT Bars and rods by
applying pattern of X ribs upon or in relation to TMT bars and rods as
depicted in Annexure "H" in print form or online which may create
misrepresentation and lead to passing off the Defendants goods as that of
the plaintiff.
(c)A decree for obliteration and destruction of all the offending goods,
dies, packaging, hoardings, placards, promotional material, advertisement,
stationery, signs, signage of the defendants' goods bearing the mark
contained in Annexure "H";
(d)Enquiry into the loss and damage suffered by the Plaintiff and
upon loss being ascertained a decree be passed therein.
(e)Injunction,
(f)Receiver,
(g)Attachment;
(h)Costs
(i)Further or other relief as Your Lordship may think fit and proper;
The instant application is for temporary as well as ad interim
injunction along with other consequential relief.
The case of the petitioner in brief is that the petitioner is a private
limited company carrying on business of manufacturing, selling and
distribution of TMT bars, wires, grills etc since 2001. The petitioner is the
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pioneer of manufacturing "X-ribs" TMT bars coppied distinct surface
pattern with letter "X" embossed at regular intervals over the entire
surface and length of TMT bars. Each bar has two series of "X" pattern.
On one side of the series the brand name "SRMB" is embossed in regular
style at the "X" intervals and grade of Fe 415,500,550 etc. The petitioner
has been advertising and promoting their product since 2001. The
petitioner had applied for and secured the designed registration in respect
of rod for re-enforcing a grade bearing design no.191774 dated 4th April,
2003. However, the said design was cancelled upon an objection filed by
one Tribeni Industries Pvt. Ltd. before the Design Office. The order of
cancellation dated 3rd February, 2010 was made only because of
publication/advertisement of petitioners "X" RIB TMT bars before the date
of its application for design registration. Further case of the petitioner is
that the petitioner filed application before trade marks registry on 8th
November, 2016 for registration of the same "X" RIBS pattern TMT bars
claiming exclusive use of the said pattern since 4th January, 2001. The
said application is pending for consideration.
It is alleged by the petitioner that the respondents are also
manufactures of TMT bars and they are new in the market. The respondents are advertising their TMT bars with pattern "X" RIBS look alike as "YY RIB". The surface pattern of respondents TMT bars are exact copy of the petitioners "X" RIB pattern, thus, making the respondents TMT bars virtually identical. It is also stated by the petitioner that the respondents had been using an elliptical helix pattern/shape on their TMT 4 bars and later switched over to "X RIB" pattern describing the said pattern as "YY" ribbed. Thus, the respondents have dishonestly and in slavish manner copied the surface pattern of the petitioner on the TMT bars manufactured by them only to create confusion in the minds of the customers of the petitioner and thereby causing substantial financial loss to it.
Further case of the petitioner is that on or about May, 2017, the petitioner sent a cease and desist notice to the respondent no.1 to discontinue use of "X RIB" pattern on its TMT bars. The respondents sent a reply through their Attorney on 15th May, 2017 claiming that the surface pattern of respondents TMT bars was "Y" ribbed which no one else uses.
The respondents applied for trademark registration of a line drawing of "X RIB" pattern in respect of TMT rods on 31st December, 2016 and obtained registration of the said pattern. In the application for registration, the trademark applied for was stated as "Super Shakti", but the actual mark was simply a line drawing, to avoid detection in trade mark search. The petitioner has filed an application for rectification of the said "Super Shakti" trade mark registration before the Intellectual Property appellate Board at Chennai which is pending for disposal.
According to the petitioner, the respondents are falsely describing "X RIB" pattern of the petitioner as "YY RIBBED". The respondents have coined an arbitrary term "YY RIBBED" for their TMT bars to pass off their products as that of the petitioner's without being readily detected by the consumers. It is claimed by the petitioner that it being the prior user of "X 5 RIB" pattern TMT bars, its right to use the said pattern exclusively is required to be protected. It is also alleged by the petitioner that the specific Act of copying the surface pattern of the TMT bars of the petitioner on the TMT bars by the respondents amounts to unfair trade practice and passing off by way of mis-representation made by the respondents in course of manufacturing, distributing and selling TMT bars to prospective customers or ultimate consumers of goods or services supplied by them, which is calculated to ensure the business or good will of the petitioner as a reasonably forceful consequence, thereby causing actual damage to the business or good will of the petitioner in the trade of manufacturing, distributing and selling of TMT bars. So is the prayer for ad interim injunction.
Learned Advocate for the petitioner submits that the petitioner company for the first time conceived the idea of X rib design of TMT bars. X rib surface pattern has become popular by virtue of advertisement in the media by the petitioner. From the very beginning of embossing X rib pattern on the surface of TMT bar, the said surface pattern has earned tremendous goodwill and reputation in the market. The petitioner also published advertisement giving caution to other manufacturers and consumers for not copying or imitating X rib bar on their products. Learned Advocate for the petitioner draws my attention to the advertisements of SRMB TMT bars with X rib pattern published in the newspapers and invoice dated 28th January, 2005, 28th March, 2004, 2nd March, 2006 etc. to establish that the petitioner has been manufacturing 6 X ribbed TMT bars since 2003-04 or even prior to that. According to the learned Advocate for the petitioner, SRMB TMT bar with surface design became the integral part of the trademark of the petitioner. The petitioner made an application dated 11th August, 2016 for registration of 3D mark on SRMB "X ribs" device. From the said application it would be ascertained that the petitioner's brand has registered trademark "SRMB 500"(label)"and "X ribs(word)". Though the 3D trademark of X pattern has not been registered as yet, but the petitioner is entitled to get protection in respect of user of X pattern on the TMT bars as prior user of the said pattern.
It is further submitted by the learned Advocate for the petitioner that difference between an action for infringement of trademark and an action for passing of lies on the principle that statutory remedy is available for infringement of trademark, whereas the action for passing of is a common law remedy. For infringement, it is necessary only to establish that the infringing mark is identical or deceptively similar to the registered mark. But in the case of passing of action, it is necessary to prove that the marks are identical or deceptively similar which is likely to deceive or cause confusion and damage to the business of the company. Secondly, when a trademark is registered, registration is given only with regard to a particular category of goods and protection can be given only to those goods and services. But in a passing of action, the defendant's goods need not be the same; they may be related or even different. 7
With this introduction, it is urged by the learned Advocate for the petitioner that the petitioner is the prior user of X ribs on the TMT bars. The defendants are also manufacturers of TMT bars. They have dishonestly and wrongfully embossed XX pattern on the TMT bars on the strength of registration of trademark of label only. It is further submitted by the learned Counsel for the petitioner that the so called YY pattern is nothing but slavish imitation of X pattern only to deceive the customers in order to cause financial loss, goodwill and reputation of the petitioner who is indisputably prior user of such pattern.
The learned Counsel for the petitioner further submits that law is well settled on the subject that merely because the defendant has obtained a trademark under the provision of Trademarks Act in respect of a particular pattern, such fact cannot extinguish the common law right by the plaintiff to have an injunction restraining passing off if it appears that the plaintiff is the earlier user of the mark and that the registered trademark of the defendant is deceptively similar to that of the plaintiff. Once it is established that the mark of the defendant is deceptively similar to that of the plaintiff and the plaintiff has been using the said mark from the earlier point of time, he is entitled to get an order of injunction against the defendant. In support of his contention he refers to a decision of this Court in the case of Amar Nath Chakroborty Vs. Dutta Bucket Industries & Ors. reported in (2005)2 CHN 278.
The petitioner next relies upon a decision of the Delhi High Court in the case of Apollo Tyres Ltd. Vs. Pioneer Trading Corporation & Anr. 8 reported in 2017 SCC online Del 9825. In the aforesaid decision, it is held by the Delhi High Court that trade pattern adopted by different manufacturers in respect of their tyres become one of the primary source identifiers apart from their brand names. The manner in which tyres are displayed in the course of advertising also shows that the trade patterns adopted by different manufacturers are permanently displayed along with the brand name of manufacturers. The face of the tyre, i.e. it is trade pattern is what is displayed by all the manufacturers, while advertising their tyres in publications, pamphlets etc. Therefore, the trade pattern of the tyres manufactured by a particular brand cannot be imitated by other manufacturer. It is further submitted by the learned Advocate for the petitioner that the defendants may plead that the surface pattern on TMT bars are designs and since the said surface pattern has not been registered as a design by the plaintiff, the plaintiff has lost its exclusive right over the said decision on question. In Apollo Tyres Ltd.(Supra) the Delhi High Court replied to such objection in the following words.
"76. The Full Bench in this decision, inter alia, observed:
"22. In our view, the aforesaid contentions are flawed for the reason that while the Trade Marks Act confers certain statutory rights qua a registered trade mark, it does not deprive a user of an unregistered trade mark the right to protect the misuse of his mark by a defendant who is in possession of a registered trade mark. Therefore, in so far as a design, which 9 is registered under the Designs Act is concerned, it may not have the statutory rights, which a registered trade mark has, under the Trade Marks Act, it would certainly have the right to take remedial steps to correct a wrong committed by a defendant by instituting a passing off action. If such an action is instituted, the plaintiff would have to demonstrate that the registered design was used by him as a trade mark which, in the minds of the purchasing public is associated with his goods or services which, have acquired goodwill/reputation which is worth protecting. Quite naturally, result of such an action, would depend upon whether or not the plaintiff is successful in proving the essential ingredients involved in a passing off action, to which we have already made a reference hereinabove.
22.1 Therefore, the argument that since there is no saving clause in the Designs Act as found in Section 27(2) of the Trade Marks Act, and consequently such a remedy ought not to be made available qua a registered design, which is used as a trade mark, is in our view, completely without merit. As is obvious, such a passing off action would be 10 based on a plea that: the design, which is an unregistered mark, was being used by the plaintiff for the purposes of business; and that the plaintiff's goods and/or services had acquired a reputation and/or goodwill, which were identified in the minds of the cousumers, by associating the design/the mark, with the goods and/or services. In other words, the plea would be that the design which was being used as a mark identified the plaintiff, as the source of the goods supplied or services offered.
22.2 The plaintiff, in our opinion, would not have to look to the Designs Act, for instituting such an action. Therefore, the argument that the legislature by not incorporating a similar provision, such as Section 27(2) of the Trade Marks Act, has by necessary implication excluded the availability of such like remedy to a plaintiff, who uses a registered design, as his trade mark, is untenable. Our view is fortified by the opinion expressed in that regard by the learned authors of book-McCarthy: "...Dual protection from both design patent and trademark law may exist where it is alleged that 11 the configuration or shape of a container or article serves to identify and distinguish the source of goods-that is, acts as a trademark or trade dress. Such a container or product shape may also be capable of design patent protection. In such cases, the protection afforded by patent law vis-a-vis trademark law is quite different."
77. The Full Bench crystallized its opinion in para 34 of the judgment, wherein it was, inter alia, held:
"(ii) The plaintiff would be entitled to institute an action of passing off in respect of a design used by him as a trade mark provided the action contains the necessary ingredients to maintain such a proceeding."
78. In the present case, it is the case of the plaintiff that the tread pattern adopted by it in respect of its tyre Ëndurance LD 10.00 R20" serves the purpose of a trademark, i.e. it is source identifier. According to the plaintiff, it is an industry practice that different manufacturers adopt different tread patterns in respect of their tyres. The plaintiff has placed on record the different tread patterns adopted by different manufacturers. Tyres of vehicles, by and large, are black in colour; they are 12 made of the same material, namely rubber compounds; they are all round in shape like a wheel; and they all have grooves which are functional inasmuch, as, they provide the gripping and friction. In this background, prima facie, it appears to this Court that the tread patterns adopted by different manufacturers in respect of their tyres become one of the primary source identifiers apart from their brand names. The manner in which the tyres are displayed in the course of advertising also shows that the tread patterns adopted by the different manufacturers are prominently displayed along with the brand name of the manufacturer. The "face" of the tyre i.e. its tread pattern is what is displayed by all the manufacturers, while advertising their tyres in publications, hoardings, pamphlets etc."
According to the petitioner similarity of surface pattern may also raise a presumption of common imagination or close business association between SRMB and Super Shakti. Therefore, the petitioner is entitled to get an order of injunction in the instant case.
Learned Advocate for the petitioner next refers to Section 34 of the Trademarks Act which provides that nothing in this Act shall entitle the registered proprietor or registered user to interfere with the rights of prior 13 user. He also draws my attention to Sections 27,28 and 29 of the Trademarks Act and submits that the scheme of the Act is such that the rights of prior user are recognized superior than that of the registration and even the registered proprietor cannot disturb/interfere with the rights of prior user. He further submits that passing off in common law is considered to be a right for protection of goodwill in the business against misrepresentation caused in course of trade and for prevention of restraint damage on account of the said misrepresentation. In support of his contention, he refers to a decision of the Hon'ble Supreme Court in S. Syed Mohideen Vs. P. Sulochana Bai reported in (2016)2 SCC 683. It was held by the Hon'ble Supreme Court in the aforesaid report that the passing off action is essentially an action in deceit where the common law rule is that no person is entitled to carry on his or her business on pretext that the said business is that of another.
On petitioners claim for an order of injunction, learned Advocate for the petitioner also refers to the decision of Delhi High Court in the case of Indian Hotels Company Ltd. & Anr. Vs. Jiva Institute of Vedic Science & Culture reported in 2008(37) PTC 468.
Lastly it is contended by the learned Advocate for the petitioner that in the instant case, the interest of the general public is involved because there is every chance of deception of the consumers of TMT bars by accepting YY ribbed TMT bars manufactured by the defendants as X ribbed TMT bars of the petitioners'.
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Learned senior Counsel on behalf of the defendants, on the other hand, submits that the petitioner is thoroughly confused as to what he wants/seeks to protect-the product or the trade mark or the surface pattern on the product or the trade dress attached to the product. In order to explain his contention, it is urged by on behalf of the defendant that the term 'Product' may be defined as a good or service or the combination of the two that is made available by the companies in the market for sale to the end consumers. It can be in physical or non physical form. There may be endless numbers of similar products in market. As for example, a trader or manufacturer has absolute right and authority to manufacture similar kind of TMT bar. However, similar kind of product manufactured by different manufacturers is distinguished from a clutter of products by trademark, design and trade dress used by a manufacturer. There is no dispute that in cases of trademark and copyright, even if the mark or right, as the case may be, is not registered, the manufacture and prior user of a mark is entitled to common law protection. However, in order to get protection under the Designs Act or the Patent Act, the design or patent must be registered. Unless the design or patent is registered, the manufacturer cannot get any protection claiming distinctiveness of his design or patent.
The learned senior Counsel on behalf of the defendants next, draws my attention to paragraph 24 of the application and submits that the petitioner seeks for protection of "the 'X RIBS' pattern/trademark/trade dress on its TMT Bars." According to the petitioner, "the 'X RIBS' 15 pattern/trademark/trade dress" embossed on SRMB TMT bars has given the petitioner exclusive right to use the said mark as prior user. Learned senior Counsel for the defendants contends that petitioner's registered trade mark is "SRMB" while the defendants' registered trade mark is "Super Shakti". The petitioner has not come out with the allegation of infringement of its registered trade mark by the defendants. According to the learned senior Counsel for the defendants, the petitioner tries to project surface pattern of its TMT bar as an integral part of its trade mark. On this score, according to the defendants, the petitioner is fully misconceived.
Next, he refers to Section 2(d) of the Designs Act, 2000 which defines 'design' in the following words:
"design" means only the features of shape, configuration, pattern, ornament or composition of lines or colours applied to any article whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye; but does not include any mode or principle of construction or anything which is in substance a mere mechanical device, and does not include any trade mark as defined in clause (v) of sub- section (1) of section 2 of the Trade and Merchandise Marks Act, 1958(43 of 1958) or property mark as defined 16 in section 479 of the Indian Penal Code(45 of 1860) or any artistic work as defined in clause (c) of section 2 of the Copyright Act, 1957(14 of 1957);"
Thus, 'Design' refers to pattern, configuration, or any ornamentation which when applied to product gives the product a distinctive appearance. The design is what makes any article attractive and appealing. Hence, it adds to the commercial value of a product and increases its marketability. When a design is protected by registration, the proprietor who owns the registered design has an exclusive right against unauthorized imitation of the design by third parties. Secondly, the registered design helps the owner in increasing the commercial value of the trademark as the customer can identify the design and associate it with the designer at once.
Coming to the instant case, it is urged by the learned senior Counsel on behalf of the defendants that pattern "X" on TMT Bar manufactured by the petitioner is in the nature of a pattern on the surface of the iron rod- manufactured by the petitioner. It cannot get protection under the Trademarks Act, 1999. It is also pointed out by drawing attention to paragraph 2 of the legal notice issued on behalf of the petitioner and served upon the defendant that the petitioner wants to protect "X-Ribs"
surface pattern for its TMT bars" as its unique and distinctive design. Since the said surface pattern "X" is not registered under the Designs Act, 2000, the petitioner cannot get any protection either under the Trademarks Act or under the Designs Act. Learned senior Counsel on 17 behalf of the defendants further submits that the petitioner did acquire registration of the said design "X" for the article "Rod for Re enforcing Concrete" on 4th April, 2003, but the said registration was subsequently cancelled vide order dated 3rd February, 2010 on the basis of an application filed by another Company, viz., M/S. Tribeni Industries Pvt. Ltd. on the ground that the said distinctive design was already published in India or in other country prior to the date of registration. Therefore, the petitioner used to use the said "X" mark as design on the surface of TMT bar during the period between 4th April, 2003 and 3rd February, 2010 on the basis of a dishonest registration. After the said registration was cancelled, the petitioner has prayed for registration of three dimensional trademark of the same "X" pattern over its TMT bar on 8th November, 2016. According to the learned senior Advocate for the defendants 'X RIBS(word)' trademark does not give the petitioner monopoly on the design. The petitioner has been trying to project surface pattern on the TMT bar manufactured by it as a trademark, which he cannot in view of the fact that the petitioner previously used the said mark as registered design. In other words, the petitioner previously elected to use the mark as design under the Designs Act and again, it is not permissible to describe and use the said mark as unregistered trademark only to claim perpetual monopoly on the said mark.
It is repeatedly urged by the learned senior Counsel for the defendants that Section 28 of the Trademarks Act deals with the exclusive right of a registered proprietor over the trademark conferred by 18 registration. Section 29(2) delineates the circumstances when a registered trademark is infringed. In the instant case, the petitioner has prayed protection from an alleged action of passing off against the defendants. However, such relief is not also available to the petitioner because the defendants have not infringed any unregistered mark of the petitioner. In support of his contention, he has produced certain pictures of TMT bars manufactured by other companies with surface pattern "XX" embossed on them.
Learned senior Counsel for the defendants further submits that the petitioner has already filed application for rectification of the 'Super Shakti' trademark registration before the intellectual property Appellate Board at Chennai and the said application is pending for adjudication. Under such factual background, Civil Court's jurisdiction in respect of alleged action for passing off is doubtful. Learned senior Counsel has further pointed out that the petitioner challenged the order of cancellation of registration of petitioner's design dated 3rd February, 2010 before the High Court in AID no. 4 of 2010 and it was dismissed on 8th July, 2011.
According to the learned Counsel for the defendants, the petitioner's prayer for injunction alleging action for passing off against the defendants prima facie cannot stand because the allegation of infringement of trademark has not been established. Petitioner's trademarks "SRMB 500+-X RIBS" (Label) and "X RIBS"(Word) were not infringed by the defendants having distinct trademark "Super Shakti". Secondly, petitioner has failed to establish even prima facie, that "XX" has acquired reputation 19 as a mark. "XX" mark embossed on the petitioner's goods cannot be held to be a trade dress as the TMT bars are not sold in market in specially designed packaging having distinctive get up and colour scheme. Therefore, allegation of infringement of trade dress also does not arise. Thus, it is submitted by the learned senior Counsel on behalf of the defendants that the petitioner has failed to prove prima facie case in support of his prayer for ad interim injunction and is not entitled to any equitable relief at this stage.
According to the learned Counsel for the defendants, in an action for passing off, the plaintiff cannot claim protection of a surface pattern embossed on its goods which was previously registered as 'Design' under the Designs Act and subsequently cancelled by the competent authority vide order dated 4th March, 2010 which was also affirmed by this Court in AID 4 of 2010. In this regard he refers to the following observation of Micolube India Ltd.-vs.- Rakesh Kumar Trading A/s Sourabh Industries & Ors. reported in (2013) 199 DLT 740 (FB) n paragraph 53 of the report:-
"The said composite scheme of Designs Act, 2000 clearly leads to a conclusion that the design monopoly though named differently as "copyright in design", but it has trappings of patent so far as the nature and characteristic of the right is concerned. The said conclusion by fair reading of Designs Act being akin to patent is once read with the avowed objective of Designs Act wherein one of the objects is that to confer a 20 limited monopoly right which should not unnecessarily be extended makes it crystal-clear that after the expiration of design right, the treatment of the said monopoly conferred by the design right shall be the same as that of patents which is that after expiration of design right, the same shall go to the public domain as in the cases of patent and in case, the said monopoly is extended, the same shall be contrary to the objects and scheme of Designs Act."
He also refers to paragraphs 60 and 61 of the Microlube(supra) which is quoted below:-
"60. In view of the above discussion, it is clear the passing off is a right to sue in common law to prevent misrepresentation is mutually inconsistent and distinct from the purely statutory monopolies which are in the form of privileges like patents and design which operate on the jurisprudence of conferment limited statutory rights. Therefore, what can be deduced from the present discussion that the rights in common law undermines and disturb the basic thrust of the policy behind limited monopoly rights which is after the expiration of the period, the said shapes of articles or embodiments enjoying the monopoly shall go in public domain as the limited monopoly rights extinguish or lapse. Therefore, the said limited monopoly rights or privilege and common law rights jurisprudentially cannot co-exist as complementary to 21 each other, however, by saving so, it does not mean that they cannot exist independent of each other.
61. It is noteworthy to mention that no one is disputing the existence of the passing off right qua the shape of the articles which answering the present reference. The question which has been referred is whether the Design right and the passing off right can be joined together or can co-exist when the same are not saved by the Design Act. It is thus essentially a question relating to conflict between two statutes which are Trade Marks Act and Designs Act which are operating on the basis of two different legislative policies which are militating against each other in which public interests are involved. Both Designs Act and Trade Marks Act have jurisprudentially different nature of rights which are statutory and common law respectively."
It is pointed out by the learned senior Counsel on behalf of the defendants that the plaintiff/petitioner cannot allege passing off against the defendants pleading, inter alia, that the passing off right should be available to shape of the products in the cases where the Design right has been cancelled because, first, the Design Act, 2000 protects the monopoly rights for a limited period and the same cannot be extended under the guise of the passing off with a dishonest intention to establish dual monopoly or monopoly in perpetuity by involving protection under the Trade Marks Act. Secondly, the grant of the further monopoly rights 22 under the guise of the passing off to the shape of the article even after the expiry of the Design would make the Design Act redundant or nugatory or otiose and thirdly, the monopoly rights under the Design and Trade Mark are mutually inconsistent with each other. (See paragraph 63 of Micolube).
Learned Senior Advocate for the defendant next submits that the decision in Micolube (supra) which is commonly known as Mohan Lal's case came up for consideration before the Full Bench of Delhi High Court in Carlsberg Breweries A/S. Vs. Som Distilleries and Breweries Ltd. reported in AIR 2019 Del 23(FB)and the following principle is called out:-
Learned senior Advocate for the defendants next submits that the decision in Micolube(supra) which is commonly known as Mohanlal's case came up for consideration before the Full Bench of Delhi High Court in Carlsberg Breweries A/S. Vs. Som Distilleries and Breweries Ltd. reported in AIR 2019 Del 23(FB) and the following principle is called out:-
"45. This court is also of the opinion that the Full Bench ruling in Mohan Lal(supra) made and observation, which is inaccurate: it firstly correctly noted that registration as a design is not possible, of a trade mark; it, however later noted that "post registration under Section 11 of the Designs Act, there can be no limitation on its use as a trademark by the registrant of the design. The reason being: the use of a registered design as a trade mark, is not provided as a ground for its cancellation 23 under Section 19 of the Designs Act." This observation ignores that the Designs Act, Section 19(e) specifically exposes a registered design to cancellation when "(e) it is not a design as defined under clause (d) of section 2." The reason for this is that Section 2 of the Designs Act, defines "design" as " ... the features of shape, configuration, pattern, ornament or composition of lines or colours applied to any article.......; but does not include any trade mark as defined in clause (v) of sub-section (1) of section 2 of the Trade and Merchandise Marks Act, 1958...." Therefore, if the registered design per se is used as a trade mark, it apparently can be cancelled. The larger legal formulation in Mohan Lal(supra), that a passing off action i.e. one which is not limited or restricted to trademark use alone, but the overall get up or "trade dress "however, is correct; as long as the elements of the design are not used as a trademark, but a larger trade dress get up, presentation of the product through its packaging and so on, given that a "passing off" claim can include but is also broader than infringement of a trademark, the cause of action against such use lies."
Learned Advocate for the defendants further submits that the ratio laid down in Mohideen (supra) is also not applicable under the facts and circumstances of the instant case because passing off in common law is 24 considered to be right for protection of good will in the business against misrepresentation caused in the course of trade and for prevention of resultant damage on account of the said misrepresentation. The passing off action is essentially an action in deceit where the common law rule is that no person is entitled to carry on his or her business on pretext that the said business is that of another. In the instant case there is no allegation made by the petitioner that the defendants have deceitfully infringed any mark on petitioner's TMT Bar. The trademarks of the petitioner and the defendants are completely different and distinguishable. It is not the case of the petitioner that the defendants have infringed the mark of the petitioner, viz, "SRMB" (word) and "X-RIBS" (label).
Having heard submission made by the learned Counsels/Senior Counsels appearing on behalf of the parties and on perusal of the authorities on the subject cited by the learned Counsels for both the parties in support of their respective cases, I likely to state at the outset that passing off is an actionable wrong in which a person passes off his goods as the goods of another. No trader or manufacturer is entitled to represent his goods and services as the goods and services of another man; and no man is permitted to use any mark, sign or symbol, devise or other means, whereby, without making a direct false representation himself to a purchaser, he enables such purchaser to tell a lie or to make a false representation to somebody else who is the ultimate customer. The common law remedy of passing off to protect the unregistered and 25 registered trademark is invoked to safeguard the business interest, goodwill and reputation associated with such distinctive mark used by a particular trader or manufacturer.
Bearing the above essential ingredients of an action for passing off, if the factual aspect of the case in hand is analysed, one finds the following undisputed facts and circumstances:-
i) TMT Bars are manufactured by various manufacturers dealing with the trade.
ii) All TMT Bars are cylindrical in shape.
iii) The manufacturers of TMT Bars use their trade name, distinct labels, distinctive marks etc as their trademarks.
iv) In the instant case the petitioner has two registered trademarks, viz, "SRMB 500 + XRIBS" (label) and "XRIBS" (word) for their TMT Bars. Likewise the defendants have two registered trademarks "SUPER SHAKTI" and trademark image.
v) The petitioner got "XX" mark or impression registered as design on the TMT Bars manufactured by it in 2003 and the said registration was cancelled under Section 19 of the Designs Act in 2010.
Under such undisputed factual background, the petitioner contends that it has been using the said mark as an unregistered trademark since 2001 and the goods manufactured by the petitioner earn goodwill and 26 reputation on the basis of the said unregistered mark embossed on the goods. The allegation against the defendants is that they have copied the said mark on their product claiming to be "YY" mark on the strength of registered image trademark. According to the petitioner, the petitioner is the prior user of the said mark and the defendants cannot pass off their product by slavish imitation of the mark embossing on their TMT Bars.
Section 2(1)(m) of the Trade Marks Act defines "mark" which includes a devise, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof. Therefore, a mark on a product can be used as trademark. Shape of a mark may also be used as trademark. The petitioner has been using "X" shape on the goods manufactured by it since 2001. Up to this stage there is no dispute between the parties. The bone of contention between the parties is as to whether the petitioner is entitled to use "X" shape on the TMT Bars manufactured by them as a trademark or as a source identifier when the petitioner previously used the same mark as design after obtaining its registration under the Designs Act and when the said registration was cancelled due to prior publication of the design.
In paragraph 134 (b) of Mohan Lal's case (supra) held:- 27
"The remedy of passing off in so far its relates to claim of protection for shape of articles is not available for the purposes of enforcement of rights and remedies under the Designs Act. The said remedy is clearly absent under the Designs Act considering the avowed objective of the Act of 2000 which is to provide limited protection with no unnecessary extension."
It is pertinent to note that Mohan Lal decides maintainability of passing off action in respect of a mark which is registered as a design under the Designs Act. In other words, the issue before the Full Bench in Mohan Lal is whether a case for passing off in respect of a mark registered under the Designs Act is maintainable claiming the said mark as a trademark. Mohan Lal answered the above question in the negative.
In the instant case, however, the petitioner's mark "X" which was registered under the Designs Act was cancelled in 2010. The defendants do not raise any dispute against the specific plea made by the petitioner to the effect that the petitioner has been using the said mark on TMT Bars sine 2001. Admittedly the said mark was registered in 2003 and cancelled in 2010. Therefore, before registration of the said mark as a design, the petitioner use the said mark as unregister trademark and even after cancellation of registration of the said mark under the Designs Act, it has been using the same "X" mark on the TMT Bars as trademark. In view of such circumstances, in my considered opinion the instant suit for injunction in an action for passing off is maintainable. 28
The petitioner has relied upon an order passed in GA 261 of 2019 in the case of SRMB Srijan Private Limited vs. Sreegopal Concrete Private Limited passed by a Coordinate Bench of this Court on 30th January, 2019. In the said order, a Coordinate Bench of this Court passed an interim order of injunction holding, inter alia, that non-registration of the design contained in the trade pattern does not take away the right of the persons who uses the said design contained in the trade pattern as a trademark to sue for passing off.
The learned Senior Counsel on behalf of the defendants vehemently urged that the aforesaid order cannot be held as a precedent on the ground that the defendant of the said case is a franchisee of Prime Gold International Limited against whom an order of injunction was passed by the Delhi High Court on compromise or out of Court settlement and this Court passed the order of interim injunction against Sreegopal Concrete Private Limited being a franchisee of Prime Gold International Limited.
Mohan Lal (supra), Carlsberg (supra) and other authorities on the subject was considered by the Division Bench of the Delhi High Court in RFA(OA)(COMM) 22/2019 & CM APP No.22655/2019 (stay) (M/s Crocs INC USA vs. M/s Bata India and Ors.) and other allied matters. In the aforesaid report, it was contended on behalf of the appellant that the majority view in Mohan Lal as modified by the judgment of the Full Bench 29 in Carlsberg was that no passing off action would lie in respect of a registered design used as a trademark.
On the question as to whether there can be an availability of remedy of passing off in absence of express saving or preservation of the common law by the Designs Act, 2000 and more so when the rights and remedies under the act are statutory in nature, was answered by the Full Bench of Delhi High Court in Mohan Lal as under:-
(i) A design includes a shape of configuration as is evident from the definition of 'design' under Section 2(d) of the Designs Act, 2000(DA).
(ii) A design can be used as a trademark and if by virtue of its use, goodwill is generated in the course of trade of business, it can be protected by an action in the nature of passing off.
(iii) While the radeTMarks act, 1999 (TMA) confers certain statutory rights qua registered trademark, it does not deprive a user of an unregistered trademark the right to protect the misuse of his mark by a Defendant who is in possession of a registered trademark.
(iv) Therefore, in so far as a design, which is registered under the DA is concerned, it may not have the statutory rights, which a registered trade mark has, under the TMA. However, the registrant of the design "would certainly have the right to take remedial steps to correct a wrong committed by a defendant by instituting a passing off action." If 30 such an action was instituted "the plaintiff would have to demonstrate that the registered design was used by him as a trade mark which, in the minds of the purchasing public is associated with his goods or services which, have acquired goodwill/reputation which is worth protecting."
(v) Such a passing off action would be based on a plea that "the design, which is an unregistered mark, was being used by the plaintiff for the purposes of business: and that the plaintiffs good and/or services had acquired a reputation and/or goodwill, which were identified in the minds of the consumers, by associating the design /the mark, with the goods and/ or services."
(vi) In other words, the plea would be that "the design which was being used as a mark identified the plaintiff, as the source of the goods supplied or services offered."
(vii) "Therefore, having regard to the definition of a design under Section 2(d) of the Designs Act, it may not be possible to register simultaneously the same matter as a design and a trade mark.
However, post registration under Section 11 of the Designs Act, there can be no limitation on its use as a trademark by the registrant of the design. The reason being: the use of a registered design as a trade mark, is not provided as a ground for its cancellation under Section 9 of the Designs Act."
31
The aforesaid report also considered the ratio laid down in Carlsberg and held that a passing off action is not limited or restricted to trademark use alone, but the overall get up or trade dress. It was also held that Carlsberg does not explicitly or impliedly overrule the Full Bench in Mohan Lal as regards the answer to the question recorded above and suit for injunction for passing off is maintainable.
The petitioner has been able to prove prima facie that the petitioner is the prior user of the mark "X" since 2001. Previous registration of the mark as design under the Designs Act which was cancelled in 2010 does not disentitle the petitioner to bring an action for infringement of the mark on the ground of passing off. In view of the above discussion, I conclude that the petitioner has been able to make out a strong prima facie case for going to trial. Accordingly the petitioner is entitled to an ad-interim order of injunction in view of the fact that "X" mark on the TMT Bar of the defendants are ex facie identical and deceptively similar to the plaintiff's trade dress and pattern.
For the reason stated above, there shall be an order of interim injunction restraining the defendants from manufacturing, distributing, marketing and/or selling TMT Bars with "X" pattern emboss thereon for the period of two weeks after vacation or until further order whichever is earlier.
32
Defendants are at liberty to file affidavit-in-opposition within one week after vacation. The plaintiff is at liberty to file affidavit-in-reply, if any within a week thereafter. The matter shall appear under the heading "Adjourn Motion" two weeks after vacation.
(BIBEK CHAUDHURI,J.) mg