Gujarat High Court
Mohalla Tech Priavte Limited vs Lagdhir Jugaldip Bharatkumar on 24 May, 2021
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
C/AO/48/2021 ORDER DATED: 24/05/2021
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 48 of 2021
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2021
In
R/APPEAL FROM ORDER NO. 48 of 2021
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MOHALLA TECH PRIAVTE LIMITED
Versus
LAGDHIR JUGALDIP BHARATKUMAR
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Appearance:
MR KAMAL TRIVEDI, SENIOR ADVOCATE for MR SACHIN D VASAVADA (3342) with
MR SAMTRAT MEHTA, ADVOCATE WITH ADITYA CHITLEY, ADVOCATE for the
Appellant(s) No. 1
MR HASHIT TOLIA, ADVOCATE with MR. VISHAL P THAKKER(7079) for the
Respondent(s) No. 1
MS RUSHVI N SHAH(5881) for the Respondent(s) No. 1
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CORAM: HONOURABLE MR. JUSTICE BHARGAV D. KARIA
Date : 24/05/2021
ORAL ORDER
ORDER IN APPEAL FROM ORDER :
1. Heard learned Senior Advocate Shri Kamal Trivedi assisted by learned advocate Mr. Sachin Vasavada with learned advocate Mr.Samrat Mehta with learned advocate Mr. Aditya Chitale appearing for the appellant and learned advocate Mr. Hashit Tolia with learned advocate Mr. Vishal Thakker with learned advocate Ms. Rushvi N. Shah for the respondent through video conference.
2. By this Appeal from Order under Order 43, Rule 1(r) of the Code of Civil Procedure, 1908 (herein after referred to as 'the Page 1 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 Code' for short), the appellant has challenged the exparte adinterim order dated 29.04.2021 in Trademark Suit No. 538 of 2021 passed by the learned Chamber Judge, City Civil Court, Ahmedabad.
3. The learned Chamber Judge, City Civil Court, Ahmedabad, by the impugned order, granted adinterim injunction in terms of Para 38 (A to C) of the injunction application (Notice of Motion) till 10.05.2021.
4. It is the case of the appellant that the impugned order was served on 13.05.2021, therefore, the appellant could not appear before the learned Chamber Judge on 10.05.2021.
The appellant, thereafter, has filed this appeal before this Court.
5. From the above chronology events, it appears that the appellant could not appear on 10.05.2021 and thereafter, the learned Chamber Judge has adjourned the matter on 25.05.2021.
6. The learned Senior Advocate Shri Kamal Trivedi submitted that the learned Chamber Judge could not have granted ex parte adinterim injunction contrary to provisions of Rule 3 of the Order - 39 of the Code. He further submitted that the Defendant - Original Plaintiff, after having knowledge of the trademark being used of the appellant in the month of January, almost after four months initiated the proceedings Page 2 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 by filing Trademark Suit No. 538 of 2021. Learned Senior Advocate Shri Trivedi invited the attention of this Court to the impugned order, by which, the adinterim injunction was granted to submit that the order does not disclose sufficient reasons of the ingredients of the primafacie case, balance of convenience and irreparable loss as provided by Rule (1) and (2) of the Order 39 of the Code. It was further submitted that the impugned order is required to be quashed and set aside and the matter be remanded and the learned Chamber Judge be directed to hear the matter on merits for deciding the Injunction Application (Notice of Motion).
7. On the other hand, the learned advocate Mr. Tolia submits that instead of quashing and setting aside the order, let time table be fixed for hearing Injunction Application (Notice of Motion), to which, the respondent plaintiff would adhere to and see that the same be disposed of as early as possible, as any observations made by this Court would come in the way of the plaintiff as well as the respondent on merits.
8. The Division Bench of this Court in such similar facts in case of Lakhani Namkeen and AA Gruh Udhyog versus Isha Snacks Private Limited on in Appeal from Order No. 99 of 2019, has held as under:
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6. The main controversy involved in the present case is whether the impugned order meets with the requirements of rule 3 of Order XXXIX of the First Schedule to the Code which have been held to be of a mandatory nature in a catena of decisions.
7. Before adverting to the merits of the case, reference may be made to rule 3 of Order XXXIX of the First Schedule to the Code, which reads thus:
"3. Before granting injunction, Court to direct notice to opposite party.The Court shall in all cases, except where it appears that the object of granting the injunction would be defeated by the delay, before granting an injunction direct notice of the application for the same to be given to the opposite party :
Provided that, where it is proposed to grant an injunction without giving notice of the application to the opposite party, the court shall record the reasons for its opinion that the object of granting the injunction would be defeated by delay, and require the applicant
(a) to deliver to the opposite party, or to send to him by registered post, immediately after the order granting the injunction has been made, a copy of the application for injunction together with
(i) a copy of the affidavit filed in support of the application;
(ii) a copy of the plaint; and
(iii) copies of documents on which the applicant relies, and
(b) to file, on the day on which such injunction is granted or on the day Immediately following that day, an affidavit stating that the copies aforesaid have been so delivered or sent."
8. Thus, rule 3 of Order XXXIX of the First Schedule to the Code mandates that in the ordinary course, the court would direct notice of the application to be given to the opposite party before granting any relief to the plaintiff. It, however, carves out an exception in case where it appears to the court that the object of granting injunction would be defeated by delay. However, at the same time while granting an ex parte injunction, an obligation is cast upon the court by virtue of the proviso thereto to the effect Page 4 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 that where the court proposes to grant an injunction without notice of the application to the opposite party, it shall record reasons for its opinion that the object of granting the injunction would be defeated by delay.
9. According to the learned counsel for the appellant, the requirements of the proviso to rule 3 of Order XXXIX have not been satisfied, while on behalf of the respondent it has been contended that on reading the impugned order as a whole, it is clear that the requirements have been satisfied. On behalf of the respondent it has further been submitted that the grant of interim injunction in a trade mark case would be governed by the provisions of section 135 of the Trade Marks Act, as the said Act itself has made provisions in this regard.
10. In the backdrop of the facts and contentions noted hereinabove, the question that arises for consideration is whether the grant of adinterim injunction would be governed by the provisions of section 135 of the Trade Mark Act or rule 3 of Order XXXIX of the First Schedule to the Code? The impugned order has been assailed mainly on the ground that it does not meet with the requirements of rule 3 of Order XXXIX of the First Schedule to the Code. Therefore, the impugned order may be examined to ascertain as to whether or not it meets with the requirements of rule 3 of Order XXXIX. If the answer is in the affirmative, it would not be necessary to enter into the merits of the larger question as to whether the grant of interim injunction would be governed by the provisions of section 135 of the Trade Marks Act or rule 3 of Order XXXIX of the First Schedule to the Code.
11. A perusal of the impugned order shows that the Commercial Court has referred to the submissions of the learned advocate for the plaintiff and has further recorded that in support of its case the plaintiff has shown the status of its various applications and its period of user for its various products in paragraph 9 of the application. The plaintiff has also produced a comparison chart of the products of the plaintiff as well as the products of the defendant and has contended that the trademark labels were adopted and were being used by the plaintiff prior to the defendant and that the defendant has dishonestly adopted and is using an identical and/or deceptively similar mark along with the same colour combination and artistic work with the intention of harassing the plaintiff and destroying its reputation and creating confusion amongst the consumers, dealers and customers of the Page 5 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 plaintiff so as to create a belief that the products sold by the defendant belonged to the plaintiff. The Commercial Court has further recorded that on behalf of the plaintiff various decisions of the Supreme Court and High Courts were relied upon on the basis of which the learned counsel for the plaintiff requested that an ex parte adinterim injunction be granted in favour of the plaintiff. Thereafter, while recording its findings, the Commercial Court has recorded that it has considered the averments, pleadings and statements made in the plaint and the application as well as the documents on record and the submissions made by the learned counsel for the plaintiff. After considering the totality of the facts and circumstances, the Commercial Court has found that the plaintiff has established a prima facie case; if the defendant is not restrained, the plaintiff would be likely to suffer huge economic loss; and that the balance of convenience lies in favour of the plaintiff and, the refore, all the three ingredients for claiming of adinterim injunction are in favour of the plaintiff.
11.1 The Commercial Court has further recorded that considering the facts and circumstances of the case and after going through the documentary evidence produced on record, prima facie, at this stage, the interest of the plaintiff requires to be protected to a certain extent, without hearing the other side, otherwise the purpose of filing the application would be frustrated and if ex parte adinterim injunction to some extent is not granted, delay would defeat justice.
12. True it is that the Commercial Court while recording satisfaction regarding the three ingredients for grant of interim injunction and for the purpose of granting ex parte injunction without notice to the opposite parties has not assigned specific reasons as to what weighed with the court for coming to such conclusion. Nonetheless, the court has recorded that such satisfaction has been arrived at based on the pleadings, submissions and the documents on record which have been referred to in the earlier part of the order. On behalf of the respondent, the learned counsel had drawn the attention of the court to the documents on record which indicate that the appellant (defendant) had commenced business in the year 2000 and on the basis of which the learned counsel for the appellant had submitted that despite such material showing prior use of the appellant, the Commercial Court was not justified in granting ex parte adinterim injunction. Referring to such documents, the learned counsel for the respondent also pointed out to the court as to why the plaintiff was contending that such documents were forged and fraudulent and submitted that this aspect was also Page 6 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 brought to the notice of the Commercial Court. The learned counsel for the respondent also produced for the perusal of the court packets of the product of the plaintiff and the defendant to point out how similar they were to each other. It was submitted that it was on the basis of such material that the Commercial Court has recorded satisfaction as regards the three factors for grant of interim injunction and for the purpose of grant of ex parte injunction.
13. At this juncture, it may be apposite to refer to the decision of the Supreme Court in the case of A. Venkatsubbiah Naidu v. S.Chellappan, (supra) wherein it has been held thus:
"15. What would be the position if a court which passed the order granting interim ex parte injunction did not record reasons thereof or did not require the applicant to perform the duties enumerated in clauses (a) & (b) of Rule 3 of Order 39. In our view such an Order can be deemed to contain such requirements at least by implication even if they are not stated in so many words. But if a party, in whose favour an order was passed exparte, fails to comply with the duties which he has to perform as required by the proviso quoted above, he must take the risk. Noncompliance with such requisites on his part cannot be allowed to go without any consequence and to enable him to have only the advantage of it. The consequence of the party (who secured the order) for not complying with the duties he is required to perform is that he cannot be allowed to take advantage of such order if the order is not obeyed by the other party. A disobedient beneficiary of an order cannot be heard to complain against any disobedience alleged against another party."
14. In the opinion of this court, there is force in the submission of the learned counsel for the respondent that the test is not whether the Commercial Court has elaborately discussed the reasons for grant of ex parte order, the test is whether the court was conscious of the relevant considerations for grant of ex parte adinterim injunction and has considered the same while passing such order.
15. Reading the impugned order as a whole, it is clear that the Page 7 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 Commercial Court was alive to the relevant factors which are to be taken into consideration for the purpose of grant of ex parte adinterim injunction and has also recorded satisfaction as regards the ingredients for grant of ex parte injunction being satisfied.
16. Though the impugned order cannot be said to be a well reasoned order, at the same time, it cannot be said that the court has not applied its mind to the relevant factors. As noticed earlier, the court has specifically recorded that the principles for grant of adinterim injunction, namely, prima facie case, availability of balance of convenience in favour of the plaintiff and the plaintiff suffering irreparable injury and has also found that if ex parte interim injunction will not be granted, the delay would defeat justice. As held by the Supreme Court in the case of A. Venkatsubbiah Naidu v. S. Chellappan, (supra), if a court passes an order granting ex parte injunction but does not record reasons thereof, such an order can be deemed to contain such requirements at least by implication even if they are not stated in so many words. Adverting to the impugned order, it is not possible to state that it is an absolutely nonreasoned order wherein parrot like reference is made to the statutory provisions and reading the impugned order as a whole, it is not possible to state that the requirements of the proviso to rule 3 of Order XXXIX of the First Schedule to the Code are not met with. As discussed earlier, the Commercial Court has not assigned elaborate reasons for granting ex parte injunction, but from the facts and contentions recorded by it, it is evident that the court has applied its mind to the same and on that basis, has found that the principles of grant of ex parte injunction are duly complied with.
17. In Kinjal Lalitbhai Dave (supra), this court, after considering the principles laid down by the Supreme Court in the decisions referred to hereinabove, has held that it is mandatory for the court to record its reasons, howsoever briefly, as to why it proposes to grant ex parte interim injunction without giving notice to the opposite party. Moreover, the party which invokes the jurisdiction of the court for grant of order of restraint against a party without affording an opportunity to him of being heard must satisfy the court about the gravity of the situation and the court has to briefly consider these factors in the ex parte order.
18. In the opinion of this court, considering the impugned order as a whole it cannot be said that the Commercial Court has not recorded brief reasons for grant of ex parte interim injunction. In Page 8 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 the light of the fact that this court has found that the requirements of rule 3 of Order XXXIX of the First Schedule to the Code are substantially satisfied, it is not necessary to go into the larger question as to whether the grant of interim injunction in a trade mark case would be governed by section 135 of the Trade Marks Act, which again is a debatable issue and no proper submissions have been made in that regard.
19. While it would be an ideal situation if the trial court passes an order duly discussing the factors which weighed with it for the grant of ex parte injunction as adumbrated by the Supreme Court in Morgan Stanley Mutual Fund v. Kartick Das (supra); however, if the order reflects due application of mind to such factors, merely because such order does not discuss such factors in detail, it would not stand vitiated on account of lack of elaborate discussion.
20. As regards the scope of interference with the impugned order which is in the nature of an interlocutory order, reference may be made to the decision of the Supreme Court in Neon Laboratories Ltd. v. Medical Technologies Ltd., (2016) 2 SCC 672, wherein the court held thus:
"5. This Court does not normally entertain appeals against interlocutory orders. In the case of trademarks, however, keeping in perspective the endemic delay in concluding cases/suits in India because of the exponentially increasing docket explosion, temporary ad interim injunctions are of far reaching consequences, oftentimes effectively deciding the lis and the disputes themselves. Possibly for this reason 'Leave' has already been granted in the present Appeal. However, it is now well entrenched in our jurisprudence that the Appellate Court should not flimsily, whimsically or lightly interfere in the exercise of discretion by a subordinate court unless such exercise is palpably perverse. Perversity can pertain to the understanding of law or the appreciation of pleadings or evidence. We shall restrict ourselves to reference in Wander Ltd. v. Antox India P. Ltd. 1990 Supp SCC 727, wherein it has been adumbrated that the Appellate Court ought not to "reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by that court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably Page 9 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial court's exercise of discretion". We shall be careful not to transgress these frontiers.
6 Before granting an ad interim injunction, the Court in seisen of the litigation has to address its attention to the existence or otherwise of three aspects -
(a) whether a prima facie case in favour of the applicant has been established;
(b) whether the balance of convenience lies in favour of the applicant; and
(c) whether irreparable loss or damage will visit the applicant in the event injunctory relief is declined."
21. The court, in the above decision, has held that the appellate court should not flimsily, whimsically or lightly interfere in the exercise of discretion by a subordinate court unless such exercise is palpably perverse. At the cost of reiteration, it may be stated that is not possible to state that the impugned order is palpably perverse so as to warrant interference at this stage of grant of ex parte interim injunction when the parties are yet to be heard on the application for injunction. Besides, the impugned order is an ex parte order granting ad interim injunction; therefore, all that the concerned court would record is a prima facie view based upon the pleadings and submissions advanced on behalf of the plaintiff and the record before it. Such an order cannot be expected to contain detailed reasons as an order granting injunction after bi partite hearing.
22. Another aspect of the matter is that while by the impugned order, the matter was posted immediately that is on 20th March, 2019, on that date on account of request made on behalf of the appellant, the matter was adjourned to 30th March, 2019, on which date, the appellant once against sought reasonable time to file its reply, whereupon the Commercial Court has posted the matter on 28th June, 2019. To be fair to the appellant on both dates, namely, 20th March, 2019 and 30th March, 2019, the learned advocate appearing on its behalf did request the court to vacate the adinterim injunction; however, from the record it appears that the learned advocate was not ready to proceed with the injunction application on merits. Under the circumstances, when the court has once granted ex parte interim injunction, the question of vacating the same merely on the request of the Page 10 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 defendant without the matter being argued on merits would not arise. Nonetheless, rule 3A of Order XXXIX of the Code provides thus: "3A Where an injunction has been granted without giving notice to the opposite party, the court shall make an endeavour to finally dispose of the application within thirty days from the date on which the injunction was granted; and where it is unable so to do, it shall record its reasons for such inability."
23. Having regard to the provisions of rule 3A of Order XXXIX of the First Schedule to the Code, the Commercial Court ought to have made an endeavour to finally dispose of the injunction application within thirty days from the date on which the injunction was granted. Merely because the defendant had prayed for time was no reason to do away with the requirements of rule 3A of Order XXXIX of the Code. However, the learned counsel for the respondent has shown willingness to proceed with the hearing of the matter at the earliest and the learned advocate for the appellant has also agreed to the matter being heard at the earliest on a day to day basis. Therefore, the requirements of rule 3A of Order XXXIX of the Code can be taken care to a certain extent.
24. In the light of the above discussion, this court does not find any infirmity in the impugned orders passed by the Commercial Court so as to warrant interference. 25. In the result, the appeals fail and are, accordingly, dismissed. The impugned orders dated 16th March, 2019 and 22nd March, 2019 passed by the Commercial Court, Ahmedabad below applications Exhibit7 and Exhibit1 in Commercial Trademark Suits No.12 of 2019, 13 of 2019, 14 of 2019 and 16 of 2019 respectively, are hereby confirmed. It is, however, directed that the appellant/defendant shall file its reply within a period of three days from today. The respondent (original plaintiff) shall file its rejoinder thereto, if any, within a period of two days from the date of receipt of a copy of the reply. The Commercial Court shall thereafter endeavour to hear the application Exhibit7 and decide the same finally as expeditiously as possible and preferably within a period of fifteen days from the date of receipt of a copy of this order.
9. Therefore, the above decision of the Division Bench of this Court would apply in the facts of the case also as the perusal of the impugned order dated 29.04.2021, Page 11 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 wherein, the learned Chamber Judge has considered relevant factors for the purpose of the grant of exparte adinterim injunction in Para - 3 of the order which reads as under:
"3. Perused the record of the case, document produced and authorities submitted by the ld. Advocate for the plaintiff. Looking to the documents produced, plaintiff is using registered trademark "MOJ" since 2018. It is the say of the plaintiff that defendant is using the mark "MOJ"
which is identical to the plaintiff's registered trademark. It is to be noted that defendant has applied for registration on dt. 08.01.2021 and register of Trade Marks has raised on objection vide letter dt. 16.01.2021 under Section 11(1) of the Act1999. In the above circumstances, looking to the documents produced and authorities submitted by Ld. Advocate for the plaintiff, it prima facie appears that defendant has used deceptively similar and / or identical trademark to the plaintiff's product, which is likely to cause confusion in the mind of people. Therefore, considering the prima facie case of the plaintiff, if the defendant is not restrained, it will cause harm, damage and loss to the plaintiff. Hence, following order is passed.
10. It is true that the impugned order cannot be said to be well reasoned order, but at the same time, it cannot be said the Court has not applied its mind to the relevant facts. In view of the observations made by the Division Bench of this Court as noted herein above, more particularly in Para - 16 to 19, it would not be in the interest of justice to interfere in the impugned order at this stage with a rider and reminder to the trial Court that the ratio laid down in the aforesaid decision of the Division Bench of this Court be kept in mind in future while considering to pass such exparte adinterim injunction under Order 39 Rule (1) and (2) of the Code. It would not have been proper for the trial Court to pass the order without Page 12 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022 C/AO/48/2021 ORDER DATED: 24/05/2021 adequate reason as held by this Court as well as by the Apex Court time and again.
11. In view of the above, the learned trial Court is directed to hear the Injunction Application (Notice of Motion) as expeditiously as possible without being influenced by the impugned exparte adinterim injunction order.
12. At this stage, learned Senior Advocate Mr. Trivedi, on instruction, states that the appellant shall file the reply to the Injunction Application (Notice of Motion) on or before 27.05.2021.
13. Learned Advocate Mr. Tolia states that on the receipt of the reply on 27.05.2021, the respondent plaintiff shall file rejoinder, if any, to such reply on or before 29.05.2021.
14. The learned Chamber Judge is requested to hear the Injunction Application (Notice of Motion) in Trademark Suit No. 538 of 2021 on daytoday basis in view of the fact that this Court has not interfered with the exparte adinterim injunction and decide the Injunction Application (Notice of Motion) on merits in accordance with law, after giving opportunity of hearing and considering the material on record, on or before 07.06.2021.
15. Appeal from Order stands disposed of. Direct service is permitted to both the parties.
Page 13 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022C/AO/48/2021 ORDER DATED: 24/05/2021 ORDER IN CIVIL APPLICATION :
Civil application does not survive in view of the order passed in Appeal from Order. Hence, civil application stands disposed of accordingly.
(BHARGAV D. KARIA, J) F.S. KAZI Page 14 of 14 Downloaded on : Sat Jan 15 02:32:18 IST 2022