Calcutta High Court (Appellete Side)
Sony Kabushiki Kaisha vs M/S. Mahaluxmi Textile Mills on 25 February, 2009
Author: Surinder Singh Nijjar
Bench: Surinder Singh Nijjar
Form No. J(2)
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
APPELLATE SIDE
Present:
HON'BLE MR. SURINDER SINGH NIJJAR, CHIEF JUSTICE
AND
THE HON'BLE JUSTICE INDIRA BANERJEE
AND
THE HON'BLE JUSTICE ANIRUDDHA BOSE
F. M. A. No. 1310 of 1999
F. M. A. T. No. 1014 of 1998
SONY KABUSHIKI KAISHA
Vs.
M/S. MAHALUXMI TEXTILE MILLS
Advocates for the Appellant: Ms. A. Salhotra
Mr. O. P. Jhunjhunwala
Advocates for the Respondent: Mr. Haradhan Banerjee
Mr. Nilmoy Das Judgment On: 25.02.2009 ANIRUDDHA BOSE, J.:-
1. This reference arises out of an appeal in a suit for infringement and passing off of the trade mark SONY. The plaintiffs in the suit (Title Suit No. 129 of 1997) instituted before the learned District Judge, Alipore, 24-Parganas (South) are Sony Kabushiki Kaisha, a company organised under the laws of Japan (who are also known as Sony Corporation). In the suit, they alleged violation of their trade mark rights in respect of the trade mark SONY by the defendants/respondents. The appellants being the plaintiffs in the suit, claim to be a multinational company engaged primarily in the business of manufacture and sale of diverse range of goods including video and audio equipments, televisions and other electronic goods under the trade mark SONY. The complain against the respondents is that they were applying the same trade mark on their products, being hosiery goods, briefs and underwear, without the authorisation or consent of the appellants. In connection with this suit, an application for interim injunction was taken out by the appellants before the trial court, seeking restraint order on use of the mark SONY by the respondents. Such prayer was rejected. Against this order of rejection of prayer for temporary injunction by the trial court, appeal before this Court was preferred by Sony Corporation.
2. Before the Hon'ble Division Bench hearing out the appeal, a point was taken by the respondents that the class or category of goods of the parties being entirely different, the appellants were not entitled to relief under the principles of passing off. The Hon'ble Division Bench observed:
".......... we ourselves are of the view that if a person is the holder of a trade mark which has acquired a wide reputation transcending international barriers even though in respect of a specified clause or category of goods, that trade mark cannot be allowed to be violated by another person in respect of different category of goods because in our view that other person will be deliberately using the trade mark of the former with an intent to get some undue advantage because of its reputation and goodwill."
3. On an identical point, however, there is an earlier decision of an Hon'ble Division Bench of this Court in the case of Rustom Ali Molla & Ors. Vs. Bata Shoe Company reported in AIR 1957 Cal 120 in which a contrary view has been expressed. Two passages from this judgment were considered by the Hon'ble Division Bench in the appeal out of which this reference arises, before referring the matter for being reconsidered by a larger bench. These are contained in paragraphs 9 and 17 of the Report, and the relevant portion of this judgment, as recorded by the Division Bench in the order dated 4th August 1999 are reproduced below:
"In our view, the mark 'Bata' not having been associated in the public mind with lungis or handkerchiefs, these goods being of a totally different character from those of the respondents' goods, the appellant's user of the said mark or name in respect of lungis or handkerchiefs of their manufacture cannot constitute any passing off of their goods as that of the respondents."
The Hon'ble Division Bench of this Court in the case of Rustom Ali Molla further observed:
"In the facts of this case, the correct legal position appears to us to be what was laid down in the following observation of Lord Watson delivering the judgment of the Board in the case of (1887) 12 AC 453, at p. 457(B).
"The acquisition of an exclusive right to a mark or name in connection with a particular article of commerce cannot entitle the owner of that right to prohibit the use of others of such mark or name in connection with goods of a totally different character and that such use by others can as little interfere with his acquisition of the right."
We would also observe in passing that a similar view was expressed by Cotton L. J. in the case of Edwards V. Dennis (1885) 30 Ch. D. 454 at p. 471(i)."
4. The Hon'ble Division Bench while considering the appellant's prayer for temporary injunction examined the ratio of the decision in the case of Rustom Ali Molla (supra), and observed:
"The judgment in Rustom Ali Molla (supra) was delivered by Calcutta High Court as far back as in the year 1956 and it relied upon the observations made by Romer L. J. in the case of Clock Ltd. Vs. The Clock House Hotel Ltd. in the year 1936 and the observations of Lord Watson and Cotton L. J. made in 1887 and 1885 respectively. Our view is that, with the advent of commercial transactions coming up and expanding the way these are doing, and the vast globalisation of trade and commerce, previous view expressed by the Division Bench of this High Court in Rustom Ali Molla is not in keeping with the fast pace of commercial developments and that the views expressed by Delhi High Court in the above-referred two judgments are more relevant in the present context in India. We are saying so as we ourselves are of the view that if a person is the holder of a trade mark which has acquired a wide reputation transcending international barriers even though in respect of a specified clause or category of goods, that trade mark cannot be allowed to be violated by another person in respect of different category of goods because in our view that other person will be deliberately using the trade mark of the former with an intent to get some undue advantage because of its reputation and goodwill."
5. However, since the decision of this Court in Rustom Ali Molla (supra) was delivered by a bench of coordinate strength, the Hon'ble Division Bench opined that ratio of the said decision requires reconsideration by a larger Bench of this Court. Thus, the question which we are required to answer in this reference is whether the principle of law as stated by this Court in the case of Rustom Ali Molla (supra) to the effect that in a passing off action, if the plaintiff fails to establish that the trade mark, the misuse of which is complained of, is being applied by the defendant on the same class or category of goods in respect of which the plaintiff uses the mark would not be entitled to any relief, is still good law or not.
6. Before us, extensive arguments had been advanced by the learned counsels appearing for the appellants and the respondents, and a voluminous compilation of case laws have been tendered by the learned counsels appearing for the parties. All the authorities referred to in these compilations, however, have not been cited or referred to in course of hearing, and in this judgment we shall discuss only those authorities which were actually cited before us by the learned counsels for the respective parties.
7. The appellants' case is that the trade mark "Sony" is a world famous mark and this mark has acquired such a high degree of distinctiveness that even if this trade mark is applied to briefs and underwear, there is likely to be confusion in the mind of consumers as regards source or origin of these goods. Consequentially, the consumers are likely to be misled into the belief that the vests and underwear sold under the trade mark SONY are of appellants' manufacture or merchandise. Learned counsel appearing for the appellants has relied on the decision of the Hon'ble Supreme Court in the cases of Mahendra & Mahendra Paper Mills Ltd. Vs. Mahindra & Mahindra Ltd. reported in 2002 (24) PTC 121, and the following cases in support of her submission (i) Daimler Benz Aktiegesellschaft & Anr. Vs. Hybro Hindustan reported in AIR 1994 Del 239, (ii) Ciba Geigy Vs. Surender Singh reported in AIR 1999 Del 49, (iii) Aktiebolaget Volvo Vs. Volvo Steels Ltd. reported in 1998 PTC (18) 47, (iv) Caterpillar Inc. Vs. Jorange reported in 1998 PTC (18) 31, (v) Sunder Parmanand Vs. Caltex (India) Ltd. reported in AIR 1969 Bom 24, P. C. (vi) Mallappa & Co. Vs. McDonald's Corporation reported in 1999 PTC (DB) 9 (vii) Kamal Trading Co. Vs. Gillette reported in 1998 PTC 1. The Hon'ble Division Bench found the views expressed by the Hon'ble Delhi High Court in the cases of Daimler Benz Aktiegesellschaft (supra) and Ciba Geigy Ltd. (supra) to be more relevant in the present Indian context.
8. Appearing for the appellants, Ms. Salhotra, learned counsel also submitted that under the Trade Marks Act 1999, an infringement action can be maintained even in respect of a class of goods for which the trade mark is not registered by its proprietor. On this issue, Section 29(4) of the Trade Marks Act 1999 has been referred to by her. The said provision stipulates:
"29. Infringement of registered trade marks.- .................(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which-
(a) is identical with or similar to the registered trade mark; and
(b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and
(c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark."
9. The main case of the respondents, argued by Mr. Banerjee is that monopoly in a trade mark is contemplated under the law only in respect of goods on which the mark is used, and the rights of the owner of an unregistered trade mark cannot extend to the entire range of goods available in the market. He has placed reliance on the following authorities in support of his submissions (i) Bhavnesh Mohanlal Amin & Anr. Vs. Nirma Chemical Wroks Ltd. & Anr. [(2005) 7 Supreme 513] (ii) Ramdev Food Products (P) Ltd. Vs. Arvindbhai Rambhai Patel & Ors. (2006) 8 SCC 726 (iii) Cadila Health Care Ltd. Vs. Cadila Pharmaceuticals Ltd. [(2001) 5 SCC 73] (iv) J. R. Kapoor Vs. Micronix India [1994 Supp (3) SCC 215], (v) Sumat Prasad Jain Vs. Sheojaman Prasad (Dead) & Ors. [1973 (1) SCC 56], (vi) London Rubber Co. Ltd. Vs. Durex Products Incorporated & Anr. (AIR 1963 SC 1882), (vii) Thomas Bear & Sons (India) Ltd. Vs. Prayag Narayan (AIR 1940 PC 86) and National Sewing Thread Co. Ltd. Chidambaram Vs. James Chadwick & Bros. (AIR 1953 SC
357).
10. We do not accept the argument of the appellants that because of enlargement of the scope of the term infringement under the Trade Marks Act, 1999, it should be automatically presumed that the respondents' acts were prohibited under the law. To answer this reference, we have to test the position of law under the provisions of the Trade and Merchandise Marks Act, 1958, as it was this enactment under which the appellants' case was being examined by the Hon'ble Division Bench.
11. Before considering the arguments of the learned counsels appearing for the respective parties in the light of the authorities cited before us, we shall briefly discuss the principles of passing off evolved in England as also in this country by the law courts. The action for passing off originated from action for deceit, and the main ingredient of the tort of passing off is false representation made by a trader as regards source or origin of his goods. The House of Lords, in the case of Reckitt & Colman Products Ltd. Vs. Borden Inc (1990) 1 WLR 491 laid down the following elements as necessary ingredients of a passing off action:-
(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 goods or services offered by the defendants are goods or services of the plaintiff; and (3) that the plaintiff has suffered or likely to suffer damage as a result of the erroneous belief engendered by the defendant's misrepresentation. (Halsbury's Laws of England; Volume 48, Fourth Edition. 2000 Reissue, para 298, page 185)
12. The principles of passing off enunciated by the english courts was applied by the law courts in India, and was given statutory recognition both under the Trade Marks Act, 1940 and the Trade and Merchandise Marks Act, 1958. Section 27 of the 1958 Act, which is applicable in the proceeding out of which the present reference arises, provides:-
"27. NO ACTION FOR INFRINGEMENT OF UNREGISTERED TRADE MARK - (1) No person shall be entitled to institute any proceeding to prevent, or to recover damages for, the infringement of an unregistered trade mark.
(2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off goods as the goods of another person or the remedies in respect thereof."
13. The Hon'ble Supreme Court, in the case of Rustom & Hornby Ltd. Vs. Z. Engineering Co. (AIR 1970 SC 1649) held:
"The distinction between an infringement action and a passing off action is important. Apart from the question as to the nature of trade mark the issue in an infringement action is quite different from the issue in a passing off action. In a passing off action the issue is as follows:
" Is the defendant selling goods so marked as to be designed or calculated to lead purchasers to believe that they are the plaintiff's goods?"
14. The principles of passing off which ought to be considered by the courts has been further clarified by the Hon'ble Supreme Court in the case of Cadila Health Care Ltd. (supra). In this judgment, it has been held:-
"35. Broadly stated, in an action for passing-off on the basis of unregistered trade mark generally for deciding the question of deceptive similarity the following factors are to considered:
(a) The nature of the marks i.e. whether the marks are word marks or label marks or composite marks i.e. both words and label works.
(b) The degree of resembleness between the marks, phonetically similar and hence similar in idea.
(c) The nature of the goods in respect of which they are used as trade marks.
(d) The similarity in the nature, character and performance of the goods of the rival traders.
(e) The class of purchasers who are likely to buy the goods bearing the marks they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods.
(f) The mode of purchasing the goods or placing orders for the goods.
(g) Any other surrounding circumstances which may be relevant in the extent of dissimilarity between the competing marks."
15. From these authorities, it is apparent that similarity of the goods of the rival traders is not an essential requisite for maintaining an action for passing off. In the case of Mahendra & Mahendra Paper Mills Ltd., the defence of dissimilarity in the field of operation was taken. This argument was not accepted, and it was held by the Hon'ble Supreme Court:
"23. Judging the case in hand on touchstone of the principles laid down in the aforementioned decided cases, it is clear that the plaintiff has been using the word "Mahindra" and "Mahindra & Mahindra" in its companies/business concerns for a long span of time extending over five decades. The name has acquired a distinctiveness and a secondary meaning in the business or trade circles. People have come to associate the name 'Mahindra' with a certain standard of goods and services. Any attempt by another person to use the name in business and trade circles is likely to and in probability will create an impression of a connection with the plaintiffs' group of companies. Such user may also effect the plaintiff prejudicially in its business and trading activities. Undoubtedly, the question whether the plaintiffs' claim of 'passing-off' action against the defendant will be accepted or not has to be decided by the Court after evidence is led in the suit. Even so for the limited purpose of considering the prayer for interlocutory injunction which is intended for maintenance of status quo, the trial Court rightly held that the plaintiff has established a prima facie case and irreparable prejudice in its favour which calls for passing an order of interim injunction restraining the defendant- company which is yet to commence its business from utilising the name of 'Mahendra' or 'Mahendra & Mahendra' for the purpose of its trade and business. Therefore, the Division Bench of the High Court cannot be faulted for confirming the order of injunction passed by the learned Single Judge."
16. Learned counsel for the respondents, however, sought to distinguish the judgment of Mahendra & Mahendra Paper Mills Ltd. (supra) and questioned its applicability in the facts of the present case on two counts. His first submission was that in this judgment, the Court was examining the issue of misuse of corporate name, and the same principle would not apply to a case where the controversy is over application of a trade mark on goods. The second limb of his argument on this count is that the ratio of the decision in this case ought to be held per incuriam, as the case of London Rubber Co. Ltd. (supra) was not considered by the Hon'ble Supreme Court in the case of Mahendra & Mahendra paper Mills Ltd. He submitted that since the decision of London Rubber Co. Ltd. was delivered by a bench having superior strength, of three judges, we should follow the ratio laid down in the former decision.
17. We reject the first submission advanced on behalf of the respondents straightway. The ratio of the decision of the Hon'ble Supreme Court in the case of Mahendra and Mahendra Paper Mills Ltd. is on the principle of passing off. A passing off action lies on the allegations of misuse of both business name and trade mark (applied on goods). The basic principle would not vary in its application if the acts complained against relate to application of a mark on goods, as against application of an expression as a business name. In the event a passing off action is instituted to defend the exclusivity of a corporate name, it would not be open to another trader to justify the use on the ground that he is using the same corporate name as his business identity in respect of a business entirely different from that of the plaintiffs. In fact, as it has been discussed in the earlier part of this judgment, in the case of Mahendra and Mahendra Paper Mills Ltd. the field of business of the respective parties was different. We do not find any rationale for applying a separate yardstick while testing the claim of a plaintiff in a passing off action founded on allegation of misuse of a mark by its application on a range of goods different from those of the plaintiff's.
18. The main controversy in the case of London Rubber Co. (supra) was over registration of the trade mark DUREX under the provisions of the Trade Marks Act 1940 in respect of certain contraceptive devices. The application for registration was opposed by another company who had claimed user of an identical trade mark in respect of surgical rubber goods and was registered proprietor of this trade mark. The opposition was overruled by the Deputy Registrar of Trade Marks, and the application for registration was accepted under the provisions of Section 10(2) of the said Act. The said provision permitted registration by more than one proprietor of trade marks which are identical or nearly resemble each other in respect of the same goods or same description of goods under certain special circumstances and honest concurrent use. It was in that context the registration of the trade mark Durex was allowed by the Registrar, and this decision was approved by the this Court as well as the Hon'ble Supreme Court. This authority does not assist the respondents in any way.
19. The case of Ramdev Food Products (P) Ltd. (supra) involves an intra- family dispute over user of the trade mark RAMDEV. The question of applicability of the principles of passing off of a trade mark in respect of rival traders using identical trade mark on altogether different range of goods was not in issue in this case. Our attention, however, was drawn to paragraph 91 of the judgment, in which the concept of passing off was explained. In this judgment, it has been held:
" Although the defendant may not be using the actual trade mark of the plaintiff, the get up of the defendant's goods may be so much like plaintiff's that a clear case of passing-off could be proved. It is also possible that the defendant may be using the plaintiff's mark, the get- up of the defendant's goods may be so different from the get-up of the plaintiff's goods and the prices also may be so different that there would be no probability of deception to the public. However, in an infringement action, an injunction would be issued if, it is proved that the defendant is improperly using the plaintiff's" mark. In an action for infringement where the defendant's trade mark is identical with the plaintiff's mark, the Court will not enquire whether the infringement is such as is likely to deceive or cause confusion. The test, therefore, is as to likelihood of confusion or deception arising from similarity of mark, and is the same in both in infringement and passing-off actions........."
20. In the case of Bhavnesh Mohanlal Amin & Anr. (supra), the rival marks were NIRMA and NIMA. The use of the former was in respect of detergent powder and detergent cakes, while the latter was applied to spices, matchbox and other consumer items. The respondent, in an action for passing off had obtained an interim order of injunction restraining the appellant (defendant) from using the mark NIMA in respect of flour mills. The High Court had confirmed the order dismissing an appeal filed by the appellant. Before the Hon'ble Supreme Court, this judgment was assailed on the ground that the goods of the parties on which the subject-mark was applied being different, the judgment under appeal ought not to be sustained. This appeal was disposed of by the Hon'ble Supreme Court, with the following observation:-
"20. In the aforesaid background we direct the trial Court to dispose of the suit as early as practicable preferably by the end of January 2006. Residual question is whether as contended by learned counsel for the appellants the protection given by the High Court while disposing of the appeal and extended by this Court initially by orders dated 27.5.2005 and 13.7.2005 should be continued as the conclusions of the trial Court as affirmed by the High Court are erroneous in law and the appellants have a fair chance of success in the suit. On the other hand, it was pointed out by learned counsel for the respondents that the respondents have succeeded before two courts and the correct position in law has been kept in view.
21. On the peculiar circumstances, we feel it would be desirable to vary the interim order to the extent that there shall not be stay of operation of the High Court's order but without leave of the trial Court the respondents' shall not initiate any action for user of the mark NIMA by the appellants till the disposal of the suit.
22. The appeal is disposed of without any order as to costs." But this judgment is not an authority on the issue which we are examining in this reference.
21. The case of Sumat Prasad Jain (1973) 1 SCC 56 is an authority on distinction between the trade mark and property mark (under the Indian Penal Code 1860). The question which was examined by the Hon'ble Supreme Court in this case was as to whether a complaint for criminal action under Sections 482 and 486 of the Indian Penal Code, 1860 ought to be sustained or not. The other authority relied on by the respondent no. 1 was the decision of the Hon'ble Supreme court in the case of J.R. Kapoor Vs. Micronix India reported in 1994 Supp. (3) SCC 215. The trade marks involved in this case were MICRONIX and MICROTEL. The plaintiffs in this case had obtained an interim injunction restraining use of the trade mark MICROTEL alleging that the same was in conflict with their trade mark MICRONIX. The Hon'ble Supreme Court found sufficient distinguishing elements in user of these two trade marks, and the appeal against the order of injunction was allowed. In this case, one of the grounds, on which the appellant relied on was that the goods of the respective parties were different. But in the judgment, that aspect of the controversy was not decided upon. It was held:
" We are therefore unable to see how the visual effect of both the logos will be the same on the mind of the buyers. This being the case, we are of the view that there is not even the remotest chance of the buyers and users being misguided or confused by the two trade names and logos. Same is the case with the carton which merely reproduces both the trade names and the logos."
22. The decision in the case of National Sewing Thread Co. Ltd. Chidambaram Vs. James Chadwick and Bors. is again in a proceeding arising out of an order of the Registrar of Trade Marks refusing to register a trade mark under the 1940 Act. In this case, the Hon'ble Supreme Court considered what would constitute confusion or deception while examining an application for registration. On the issue of passing off, it was however held:
"The consideration relevant in a passing off action are somewhat different than they are on an application made for registration of a mark under the Trade Marks Act and that being so the decision of the Madras High Court referred to above could not be considered as relevant on the questions that the Registrar had to decide under the provisions of the Act."
The present reference having originated from a passing off action, ratio of this decision is not applicable for adjudicating controversy before us.
23. None of these authorities, in any event, lay down in absolute terms that difference in the class or category of goods of the rival traders would defeat an action for passing off. In the judgment of Rustom Ali Molla, the Hon'ble Division Bench referred to nine decisions, and eight of them were delivered by the English Courts in the backdrop of the commercial environment of the late nineteenth and early twentieth century. These decisions are reported in (I) (1887) 12 AC 453, (ii) (1910) 1910-1 Ch. 248, (iii) (1902) 1902-2 Ch. 282, (iv) (1912) 29 RPC 433, (v) (1898) 15 RPC 105, (vi) (1898) 16 RPC 12, (vii) (1936) 53 RPC 269, (viii) (1885) 30 Ch D. 454. The other decision which was relied upon by Their Lordships is the judgment of the Judicial Committee of the Privy Council in the case of Thomas Bear & Sons (India) Ltd. Vs. Prayag Narayan & Anr. (AIR 1940 PC 86). We shall discuss the ratio of this decision in the later part of this judgment.
24. The law of passing off in England, so far it relates to use of trade marks in different classes and categories of goods, has undergone substantial change. This would be evident from the following passage from Halsbury's Laws of England (volume 48, fourth edition, reissue 2004, p. 203):-
"318. Common field of activity and likelihood of deception. The presence or absence of a common field of activity in which the claimant and the defendant are engaged is a factor to be taken into account in considering whether it is likely that persons coming across the defendant's use of the name, mark etc complained of will assume that he and the claimant are connected. Such a factor may also be significant in deciding even assuming that a misrepresentation is established, whether the claimant is likely to suffer any substantial damage as a result of the defendant's activities.
Where the defendant's activities, although not in an area of business in which the claimant is engaged, are in an area of business which might be assumed to be a natural extension of the claimant's business, likelihood of deception will readily be inferred. However, even where the fields of activity in which the claimant and the defendant are engaged are remote from each other, it is possible for deception to occur if the name or mark used is highly distinctive, or if the claimant's mark or name is well known and is closely copied with regard to style, lettering etc."(emphasis added)
25. In the case of Thomas Bear & Sons (India) Ltd. (supra), the plaintiffs were manufacturers and sellers of cigarettes and tobacco meant for smoking in pipes under a trade mark comprising of the representation of an elephant on the packets and tins in which those items were sold. These containers carried the designation "Elephant Cigarettes". The defendants were also manufacturers of chewing tobacco and carried representation of elephant on their packets and tins. The claim of passing off of the appellants/plaintiffs was rejected by the trial Court as well as the High Court of Allahabad, and the Judicial Committee also confirmed the order of the High Court, holding:-
"It is clear that the right of property that may be acquired in such a trade mark is based on the proved association in the market of the device, name, sign, symbol or other means in question with the goods of the plaintiff, so that the use by the defendant on such goods of the trade mark will amount-whether the defendant intends it or knows it or not-to the false representation that the goods are manufactured or put on the market by the plaintiff. There can obviously be no monoploy in the use of the trade mark. A manufacturer of cigarettes under an undoubted trade mark such as an animal, or any other device cannot legally object to the use of the identical mark on, say, hats, or soap for the simple reason that purchasers of any of the latter kinds of goods could not reasonably suppose, even if they were well acquainted with the mark as used on cigarettes, that its use on hats or soap denoted that these goods were manufactured or marketed by the cigarette manufacturer; see (1887) 12 A C 453."
26. It would be apparent from this passage that the Judicial Committee had dismissed the appeal upon coming to a finding that there was no possibility of confusion in the mind of the purchasers. All the authorities which were considered by the Hon'ble Division Bench in the case of Rustom Ali Molla appear to have proceeded on an underlying reasoning that if the goods of the rival traders were different, there would be no possibility of deception or confusion in the mind of consumers as regards the source or origin of the goods. But from the days of "one company one product", the commercial world has considerably changed and the large corporations in the contemporary world operate with multiple products or services across the globe. Modern marketing technology aided with improved communication system has also strengthened the distinctive properties of individual trade marks. Under these circumstances, to hold that the reputation of a trade mark shall remain restricted to those goods and services only in which its proprietor is directly engaged in, would be ignoring the ground realities of today's business world.
27. It is not our opinion that the class or category of goods or services to which a trade mark is applied ought to be altogether ignored while testing a passing of action. As laid down by the Hon'ble Supreme Court in the case of Cadila Health Care Ltd. (supra), the similarity in the nature, character and performance of the goods of the rival traders would be one of the factors in adjudication of a passing of action. In our view, it is one of the very important factors which the court should consider while deciding a claim based on passing off. But in the event the nature, character of the goods are different, this very fact should not automatically result in failure of an action founded on the tort of passing off.
28. The key function of a trade mark is to indicate the source or origin of goods and services. The tort of passing off is committed if the offending trader applies an established trade mark in such manner so as to cause confusion or deception in the mind of the consumers as regards the source or origin of the goods and the mind of purchasers are directed to the firm whose identity is already linked with the trade mark in the market place. Even if the goods or services of the rival traders are different, in our opinion this factor alone would not altogether eliminate the possibility of confusion or deception. If a highly distinctive trade mark is applied to a class of goods which its proprietor does not deal with, consumers may always wonder as to whether the proprietor of the trade mark has launched a new product. The purchasing decision of the consumers may be determined by this factor.
29. In the case of Mahendra & Mahendra paper Mills Ltd. (supra), it was argued on behalf of the appellant (defendant) that since there was no similarity of goods manufactured or sold by the parties, the question of deception or confusion among the consumers would not arise. Considering different authorities on the subject, the Hon'ble Supreme Court declined to interfere with the order of the High Court granting interim injunction restraining the defendant in that case from using the name "Mahendra" or "Mahendra & Mahendra" for the purpose of its trade and business. The decision of the Delhi High Court in the case of Daimler Benz Aktiegesellschaft & Anr. (supra) involved use of the trade mark Benz for certain hosiery goods. The plaintiffs, who owned the trade mark in respect of automobiles were successful in obtaining a restraint order before the First Court. The matter was carried upto the Hon'ble Supreme Court in appeal, and the order of the Trial court was approved. The other authorities relied upon by the appellants are in support of the proposition of cross goods protection of a highly distinctive mark. We do not consider it necessary to discuss each of these judgments individually, as they reflect the same line of reasoning.
30. We accordingly hold that the ratio of the decision of the Hon'ble Division Bench of this Court in the case of Rustom Ali Molla & Ors. Vs. Bata Shoe Co. Ltd. reported in AIR 1957 Cal 120, is no longer good law. We agree with the views expressed by the Hon'ble Division Bench in the order out of which this reference arises.
31. The reference is answered accordingly. The appeal may now be placed before the appropriate Division Bench for disposal in the light of the opinion expressed by us.
32. In view of the fact that the decision of the Hon'ble Division Bench in the case of Rustom Ali Molla Vs. Bata Shoe Co. Ltd. held the field for about five decades, we do not propose to make any order as to costs.
(Surinder Singh Nijjar, C.J.): I agree.
(Indira Banerjee, J.): I agree.
(Surinder Singh Nijjar, C.J.)
(Indira Banerjee, J.)
(Aniruddha Bose, J.)