M.Sundaram vs M/S.'Thayar' Food Products Plaintiff ... on 15 September, 2014

[Cites 13, Cited by 0]

Madras High Court

M.Sundaram vs M/S.'Thayar' Food Products Plaintiff ... on 15 September, 2014

Bench: Aruna Jagadeesan

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 15.09.2014

CORAM:

THE HONOURABLE MR.JUSTICE ARUNA JAGADEESAN

CS.Nos.196/2007 & 300/2007

M.Sundaram, Sole Proprietor
'THAYAR' Dairy, 31, Ranganathan Street
T.Nagar, Chennai 600017 Plaintiff in CS.196/2007 and
Defendant in CS.300/2007
Vs

1.M/s.'THAYAR' Food Products Plaintiff in CS.300/2007 and
1st Defendant in CS.196/2007

2.Adithyapuram Rama Iyer, Partner of M/s.'THAYAR' Food Products

3.Kannan S.Mahadevan, Partner of M/s.'THAYAR' Food Products

4.Ananda Krishnan, Partner of M/s.'THAYAR' Food Products
20, Old No.9, Hanumar Koil Street, Second Floor
(Facing Station), West Mambalam
Chennai 600033 Defendants 2 to 4 in CS.196/2007

Date of Reserving Judgement : 04.10.2013
Date of Pronouncement of Judgement : 15.09.2014
Prayer:- These Civil Suits are filed under Order IV Rule 1 of Original Side Rules read with Order VII Rule 1 of CPC read with Section 26 of CPC read with Sections 134 and 135 of Trade Marks Act, 1999.
For Plaintiff : Mr.T.V.Ramanujam, SC for
Mr.C.Rajan & Mr.V.K.Sathiamurthy-CS.196/07

For Defendants : Mr.A.Prabhakar Reddy for
M/s.APR Associates-D1, D3 & D4-CS.196/07

COMMON JUDGEMENT
Since common question of fact and law are involved in these two civil suits and further common evidence is recorded, the same are being disposed of by this common judgement.
2. CS.No.196/2007 has been filed to pass a judgement and decree,
(a) for permanent injunction restraining the Defendants, their agents or servants from continuing or repeating the infringement of the plaintiff's registered trade mark 'THAYAR'or continuing to commit any infringement of the plaintiff's name and mark 'THAYAR'or the name, colour, combination, etc. of the expression 'THAYAR'or any phonetically similar or imitation thereof, and passing off the same as that of the Plaintiff,

(b) to render true and faithful accounts of all the profits earned by them through service and sale of the offending marks and pay the amount found due on such taking of accounts to the Plaintiff,

(c) to surrender to the Plaintiff all the impugned products produced and manufactured by the Defendants, containing the same name of the offending marks, with all documents pertaining thereto.
3. CS.No.300/2007 has been filed to pass a judgement and decree,
(a) restraining the Defendant his men, agents, servants or any one claiming through him from in any manner infringing the plaintiff's trade mark 'THAAYAR' by using the offending Trade Mark 'THAYAR' or any other Trade Mark which is identical or similar or deceptively similar to that of the Plaintiff's reputed Trade Mark 'THAAYAR',

(b) for permanent injunction restraining the Defendant his men, agents, servants or any one claiming through him from in any manner passing off his products as that of the Plaintiff by using the offending Trade Mark 'THAYAR' or any other Trade Mark which is identical or similar or deceptively similar to that of the plaintiff's reputed Trade Mark 'THAAYAR',

(c) directing the Defendant to surrender to the Plaintiff the entire stocks, pouches, with the infringing artistic work ''THAAYAR' and unused infringing Trade Mark label ''THAYAR' together with blocks and dies for destruction,

(d) directing the Defendant to render a true and faithful account of the profits earned by him through the sale of their products bearing the infringing label 'THAYAR' which is similar or deceptively similar to the plaintiff's Trade Mark and copyrighted label 'THAAYAR'and directing the payment of such profits to the Plaintiff and

(e) directing the Defendant to pay the costs of the suit.
4. The plaint averments in CS.No.196/2007 are as follows:-
a. The Plaintiff M.Sundaram is the son of R.M.Muthappan and carrying on business in the name and style of 'THAYAR' Dairy. The 1st Defendant M/s.'THAYAR' Food Products is a Partnership Firm represented by its Partner Kannan S.Mahadevan and the Defendants 2 to 4 are represented to be the partners of the 1st Defendant Firm. The Plaintiff is the Proprietor of the Trade Mark 'THAYAR' with respect to food stuffs which include milk and other dairy products, ghee, butter, edible oils, pickles, jellies, jams, appalams, spices, masalas, sambar, rasam, turmeric powder, sugar, rice, tapioca, sago, flour preparations from cereals, mustard, pepper, coriander, tamarind, dhalls etc. The Plaintiff has been retailing and marketing in dairy and foodstuffs using the service mark 'THAYAR' for several decades. The Plaintiff's Trade Mark 'THAYAR' is registered under the Trade Marks Act 1999 in various classes viz. classes 29, 30 and 42 and thus, he is the registered Proprietor of the Trade Mark 'THAYAR'in respect of the aforesaid goods and services. The Plaintiff's Trade Mark became very popular and attained much valuable reputation in the market. The Plaintiff had, during the course of years, widely published the said mark through different media and spent substantial sum of money on publicity. The Plaintiff's Trade Mark and products earned a name for quality, reliability and authenticity in respect of the aforesaid goods and foodstuffs sold by him, resulting in the general public associating the said Trade Mark with the Plaintiff's products.
b. The Plaintiff came to know that the Defendants are using an identical and deceptively similar Trade Mark 'THAAYAR', which is structurally and phonetically similar to the Plaintiff's Trade Mark with respect to the products marketed by the Plaintiff. The use of the identical and deceptively similar Trade Mark has resulted in causing confusion and deception among the trade and public and continue to cause damage to the Plaintiff and the public who are carried away by the similarity of the Trade Mark name misused by the Defendants mistaking the product for that of the Plaintiff. The continued use of the registered Trade Mark 'THAYAR' belonging to the Plaintiff adversely affects the goodwill and reputation earned by the Plaintiff. The Defendants are aware of the long user and the registered Trade Mark of the Plaintiff and have marketed the products with deceptively similar Trade Mark as that of the Plaintiff, with malice aforethought. Such misuse of the Plaintiff's Trade Mark is a violation of the Plaintiff's statutory entitlements.
c. The Plaintiff, therefore, issued a notice to the Defendants on 14.01.2006, calling upon them (a) to desist forthwith from using or in any way be connected with the offending Trade Mark or any other deceptively similar Trade Mark in respect of the aforementioned allied products and give to the Plaintiff a written undertaking to the effect that the Defendants will not do in future any such offence, (b) to deliver to the Plaintiff for destruction all sachets, labels, dies, blocks, boxes, cartons, covers, letterheads, visiting cards and advertising materials etc. containing such offending Trade Mark label, (c) to instruct all the distributors of the Defendants and their dealers to withdraw from the market the products bearing the offending Trade Mark label in the manner aforesaid and (d) to render to the Plaintiff a true and correct account of the sales effected by the Defendant so far under the said offending Trade Mark label in respect of the aforesaid goods to enable them to assess the damage to be claimed from the Defendants.
d. By a letter dated 25.11.2006, the Defendants admitted the wrongful user of the Trade Mark of the Plaintiff, but falsely stated that in the discussions on 14.11.2006, the Plaintiff had allowed the Defendants to use the Trade Mark. No such agreement was ever reached between the Plaintiff and the Defendants and it is only a ruse to avoid the legal consequences of the Defendants' illegal actions. The Defendants, by using the words 'THAAYAR', which is deceptively and phonetically similar to the registered Trade Mark of the Plaintiff 'THAYAR' which has been in the continuous usage by the Plaintiff and which is the Trade Mark of the Plaintiff, have made a false trade description which is untrue and misleading in material respects as regards the goods, so as to make the public believe that they are the goods connected with the Plaintiff and to be passed off as such. Hence, this civil suit has been filed for the reliefs as stated above.
5. In the Written Statement filed by the Defendants 1, 3 and 4, in CS.No.196/2007, it is averred as follows:-
a. The 2nd Defendant is neither a necessary nor a proper party to the suit, as he is not the partner of the 1st Defendant. The Defendants 3 and 4 are the only partners of the 1st Defendant. In the advertisement in the Trade Marks Journal, the 4th Defendant's name is split as Adithyapuram Rama Iyer showing as if he is also a partner, but has nothing to do with the application. The 2nd Defendant, of which the Defendants 3 and 4 are the partners, are leading manufacturers and marketers of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of the cereals and flour and other allied goods. These Defendants are carrying on business since 1997 and have adopted the distinctive Trade Mark ''THAAYAR'' in respect of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of the cereals and flour and other allied goods. The 1st Defendant, of which, the Defendants 3 and 4 are the partners, ever since 1997 is continuing to manufacture and market the above preparations under the said Trade Mark ''THAAYAR''. By virtue of meticulous standards and quality in the products and effective sales promotion, the said products under the distinctive Trade Mark ''THAAYAR'' have become highly popular and are in great demand from the customers and trade. In fact, these Defendants have obtained ISO 9001-2000 and HACCP certificates for their products after complying with all the requirements and satisfying the required standards and facilities for manufacturing and marketing the said products. The partners of the 1st Defendant have participated in the demonstration at CFTRI, Mysore to get know-how of the process for ready to use idly batter in retail packs. Thus, these Defendants are technically competent and have infrastructure, equipments and facilities for preparing the ready to use wet flour products for marketing in retail packs. The 1st Defendant is also a registered SSI.
b. It is these Defendants who are first to introduce the concept of vending wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of cereals in organized manner in sachets. In the initial stages, these Defendants had to put lot of efforts and energy including taking the risk of acceptability of the very concept of vending ready to use wet idly flour and other wet flour products. These Defendants can also proudly say that it is due to the above efforts a new entry has come into sales tax relating to ready to use wet flour paste. The Defendants also extensively advertised the products in all media including press, magazines, televisions, radio broadcasting, railway, etc. By virtue of such extensive use of the Trade Mark 'THAAYAR', the said Trade Mark has become highly distinctive of the products of the Defendants and exclusively associated by the public with the products of these Defendants. The Trade Mark ''THAAYAR'' has acquired secondary meaning to denote and connote the products of these Defendants alone. Thus, the 1st Defendant, of which the Defendants 3 and 4 are the partners, has become the absolute Proprietor of the Trade Mark and they have also taken adequate steps to protect the Trade Mark by filing an application for registration of the Trade Mark under No.1328933 before the Registrar of Trade Marks. The said Trade Mark has been published in the Trade Marks Journal No.1336 (S1) dated 15.11.2005. The period for opposition, if any, has also expired and these Defendants are awaiting the certificate of registration from the Trade Marks Registry. Further, for all purposes, since only the act of issuing certificate is pending, the 1st Defendant of which the Defendants 3 and 4 are the partners, shall be deemed to be the registered Proprietor of the Trade Mark ''THAAYAR''.
c. While so, these Defendants were shocked to receive the notice from the Plaintiff through their attorney dated 14.11.2006 claiming that they are the Proprietor of the Trade Mark 'THAYAR' in respect of the goods falling under class 29 and 30 of the services under class 42. The Plaintiff called upon the 1st Defendant to cease and desist using the said Trade Mark. In fact, the products described in the notice issued on behalf of the Plaintiff are entirely different from that of the specific goods being manufactured and marketed by these Defendants under the distinctive Trade Mark ''THAAYAR''. In fact, these Defendants have supplied the wet flour products under the distinctive Trade Mark ''THAAYAR'' to the Plaintiff for the past seven years. The Plaintiff is not the Proprietor of the Trade Mark since the alleged Trade Mark is not applied to any of the products of the Plaintiff. The Plaintiff was originally the lessee of the general and provision store 'THAYAR' Dairy originally owned by one K.Ramanathan. Subsequent to the death of K.Ramanathan, the Plaintiff has acquired the said business in provisions and general stores. Thus, it is very clear that the Plaintiff never used 'THAYAR' as a Trade Mark, but 'THAYAR' Dairy only as trading style. Therefore, the alleged registration of the said Trade Mark 'THAYAR' in class 29 and 30 is illegal, unlawful and not appropriate. The same has been obtained by suppressing facts. These Defendants also reserve their right to seek for cancellation of the said registration in respect of the registration of the Trade Mark in class 30 as the Plaintiff never used 'THAYAR' as a Trade Mark for goods falling under class 30 including that of the products used by these Defendants.
d. Even during the life time of K.Ramanathan, the founder of 'THAYAR' Dairy, the said K.Ramanathan permitted one S.Santhanakrishnan, his grandson to carry on similar business in the same trade name Thayar Dairy in the premises at No.20(old No.9) Hanumar Koil Street, West Mambalam, Chennai 600033 and the business is now carried on by the legal heirs of late S.Santhanakrishnan. Thus, no exclusive right was granted to the Plaintiff in respect of the trade name Thayar Dairy also. Immediately after the issue of notice dated 14.11.2006, the Plaintiff himself initiated mediation talks through M.Muthukrishnan, son of K.Ramanathan and vendor of business in the trade name Thayar Dairy. It was agreed in the presence of Muthukrishnan that these Defendants would continue to use the Trade Mark ''THAAYAR'' for wet flour and other cereals, food grains, etc. and these Defendants agreed that they will not use ''THAAYAR'' for dry flour such as spices and masalas. It was also agreed by the Plaintiff that a deed of settlement would be entered into between the Plaintiff and these Defendants to amicably settle the dispute. Accordingly, the Plaintiff sent a draft Memorandum of Settlement to these Defendants. These Defendants agreed substantially to the draft Memorandum of Settlement sent by the Plaintiff and only disagreed to the clause calling upon these Defendants to pay royalty/ consideration for allowing these Defendants to use the Trade Mark ''THAAYAR'' as the first Defendant of which the Defendants 3 and 4 are the partners, has the absolute right, title and interest over the Trade Mark ''THAAYAR''. Having adopted the distinctive Trade Mark since 1997 and used extensively without interruption whatsoever, the 1st Defendant has become the absolute Proprietor of the Trade Mark ''THAAYAR''. The 1st Defendant agreed to entered into Memorandum of Settlement with the Plaintiff only in order to have a peaceful settlement even though the claims of the Plaintiff are unlawful and unfounded. There was no need or necessity for the 1st Defendant to pay any royalty or consideration to the Plaintiff for using the registered Trade Mark ''THAAYAR'' in respect of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of cereals. In fact, it is the 1st Defendant who has better right, title and interest over the Trade Mark 'THAAYAR' than the Plaintiff who has no manner of right to use 'THAYAR' as Trade Mark.
e. The 1st Defendant is doing extensive business under the Trade Mark 'THAAYAR' in respect of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of cereals etc. since 1997. The 1st Defendant has also extensively advertised its products through all media including print, televisions, radio, railway, etc. By virtue of continuous use of the Trade Mark 'THAAYAR' in respect of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of cereals and sales promotional efforts, the Trade Mark 'THAAYAR' has become highly distinctive of the products of the 1st Defendant. The trade and public always associate the Trade Mark 'THAAYAR' with the products of the 1st Defendant. The 1st Defendant without prejudice to its absolute right over the Trade Mark 'THAAYAR', has come forward to resolve the dispute with the Plaintiff by accepting to confine the use of the Trade Mark 'THAAYAR' in respect of wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly, products derived out of cereals only and gave assurance to the Plaintiff that the 1st Defendant will not venture into other products falling under class 30 viz. spices, masala, mixed masala, etc. even though the Plaintiff has not done any business using 'THAYAR' as Trade Mark except running the retail provision store using Thayar Dairy as trade name. As admitted by the Plaintiff himself, he is into the business in vending milk, dairy products and general provisions. The 1st Defendant only in order to purchase peace and to carry on business without any disturbance, accepted to restrict the use of the Trade Mark 'THAAYAR' in respect of its above said products. However, the Plaintiff without any right or basis came forward with unlawful claims as if the Plaintiff is the absolute Proprietor of the Trade Mark 'THAYAR' in respect of food products falling under class 30. Admittedly, the Plaintiff never used 'THAYAR' as a Trade Mark in respect of any of their products falling under class 30. The Plaintiff is carrying on business in retail and running a general provision store in the premises at 31, Ranganathan Street, T.Nagar, Chennai 600017. The Plaintiff till date has not applied 'THAYAR' as a Trade Mark to any of their products and marketed the same under the Trade Mark 'THAYAR'. In fact, these Defendants have supplied the wet flour products under the distinctive Trade Mark 'THAAYAR' to the Plaintiff for the past seven years. The Plaintiff with untenable allegations and claims have filed the suit in CS.No.196/2007 for infringement.
f. The 1st Defendant furnishes hereunder the annual sales turnover and advertisement expenses for the past 10 years which would establish its reputation and popularity under the Trade Mark 'THAAYAR' in respect of the above said products:-
Accounting Year
Sales Value
(Rs.)
Advertising
Expenses (Rs.)
1997-98
153318.00
---
1998-99
987272.00
6000.00
1999-2000
1974801.50
10150.00
2000-01
3475727.00
15335.00
2001-02
3108729.00
74686.00
2002-03
3580331.00
205568.00
2003-04
4143130.00
418958.00
2004-05
4999874.00
417365.00
2005-06
7216619.00
710960.00
2006-07
8008757.00
620684.00

The Trade Mark 'THAAYAR' is being exclusively associated with the 1st Defendant's products and the use of the said Trade Mark in respect of any food preparation by any one would cause deception among the traders and public that the products bearing the offending Trade Mark also emanate from the 1st Defendant or that the use of the offending Trade Mark has a kind of association with the 1st Defendant.
g. Till date, the Plaintiff has not marketed any product using 'THAYAR' as Trade Mark. The business of the Plaintiff is only retail vending dairy products and general provision store using the trade name Thayar Dairy confined to No.31, Ranganathan Street, T.Nagar, Chennai 600017. The Plaintiff, seeing the popularity of the Trade Mark 'THAAYAR' of the 1st Defendant when these Defendants supplied the wet flour products under the distinctive Trade Mark 'THAAYAR' to the Plaintiff for the past seven years, in order to make illegal profits out of the reputation of the 1st Defendant, is making attempts to use the applicant's Trade Mark to mislead the public to believe that the products sold by the Plaintiff also emanate from the 1st Defendant The sole intention of the Plaintiff is to trade upon the goodwill and reputation of the 1st Defendant and to make illegal profits out of the goodwill and reputation of the 1st Defendant. Even though the Plaintiff has no right whatsoever in respect of the Trade Mark 'THAAYAR', the 1st Defendant agreed to have the matter amicably resolved by giving up their right over the Trade Mark 'THAAYAR' in respect of other food products included in class 30 viz. spices, masala and mixed masala as suggested by the Plaintiff. The Plaintiff, however, demands royalty/consideration for using the Trade Mark 'THAAYAR' over which the 1st Defendant has the absolute right, title and interest than the Plaintiff and hence, the 1st Defendant is also not bound by the said commitment. All along, for the past over seven years, the Plaintiff was purchasing wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour from the 1st Defendant under the 1st Defendant's registered Trade Mark 'THAAYAR' and marketing the same to the public through his retail and general provision store under the trade name Thayar Dairy. In fact, the Plaintiff was purchasing wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour from the 1st Defendant till November 2006, when he caused a lawyer notice. It is only from March 2007, the Plaintiff commenced marketing wet idly flour with the offending Trade Mark 'THAYAR'. The Defendants also filed a suit in CS.No.300/2007 against the Plaintiff to restrain the Plaintiff from infringing the first Defendant's Trade Mark 'THAAYAR' and for passing off.
h. The Defendants has also given parawise reply to the allegations made in the plaint. The allegations made in paragraphs 1 and 2 are matters of record. The allegations made in paragraph 3 are not correct. The Plaintiff never used the Trade Mark 'THAYAR' in respect of any product including the foodstuffs as alleged till March 2007. In fact, the Plaintiff was purchasing wet idly/dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour from the 1st Defendant under the 1st Defendant's Trade Mark 'THAAYAR'. As the Plaintiff has not used the Trade Mark in respect of any product falling under classes 29 and 30, the said registrations are not valid and thus, the Defendants are taking steps to cancel the registration obtained by the Plaintiff in respect of the Trade Mark 'THAYAR' in classes 29 and 30. As admitted by the Plaintiff, the Plaintiff is doing business in retail and general stores under the trade name and style Thayar Dairy and has never used the Trade Mark 'THAYAR' in respect of the products falling in classes 29 and 30. The allegations made in paragraph 4 are totally false and incorrect. The Plaintiff never used the Trade Mark 'THAYAR' in respect of any product and marketed the same. The Plaintiff is deliberately making false averments as though the Plaintiff has widely publicized in different media by spending substantial sums for the offending Trade Mark 'THAYAR'.
i. The averments made in paragraph 5 are totally incorrect and false. In fact, the Plaintiff was purchasing the wet flour products from the Defendants for the past more than seven years and it is dishonest on the part of the Plaintiff to say that the Plaintiff has come to know of the use of the Trade Mark 'THAAYAR' by the Defendants only recently. The Plaintiff having commenced marketing wet idly flour under Trade Mark 'THAYAR' since March 2007, the allegation of possible confusion and deception among the trade and public does not arise. The first Defendant's products are in the market for more than a decade and the Trade Mark 'THAAYAR' is being associated widely by the public with the products of the 1st Defendant and in view of the fact that the Plaintiff has introduced its wet idly flour under the offending Trade Mark 'THAYAR' only recently, the trade and public would be made to believe that the products of the Plaintiff also emanate from the Defendants.
j. The allegations made in paragraph 6 are also totally false. The allegation that the Defendants have dishonestly marketed the products with deceptively similar Trade Mark as that of the Plaintiff is a total piece of falsehood without an iota of truth. On the contrary, the Plaintiff was all along purchasing the products under the Trade Mark 'THAAYAR' from the Defendants for the past more than seven years. With regard to the allegations made in paragraphs 7 and 8, the Defendants have explained in detail the attempted settlement after the issue of notice dated 14.11.2006 in order to purchase peace and to carry on business without any disturbance which of course was not reached. In any event, the vested rights of the Defendants in respect of the Trade Mark 'THAAYAR' by virtue of honest adoption and long and extensive use since 1997 to the knowledge of the Plaintiff entitles the Defendant to restrain the Plaintiff from using the Trade Mark 'THAAYAR' or any other mark which is similar or deceptively similar to the Trade Mark 'THAAYAR'.
k. The allegations made in paragraph 9 are not correct. The Defendant is using the Trade Mark 'THAAYAR' since 1997 having adopted the same honestly without any reference to any other trader including the trade name of the Plaintiff. The allegation that the defendant's Trade Mark 'THAAYAR' is deceptively and phonetically similar to the registered Trade Mark 'THAYAR' of the Plaintiff is totally incorrect and false. As admittedly, the Plaintiff never used the Trade Mark in respect of any products falling under classes 29 and 30 upto March 2007. The Plaintiff cannot claim to be the Proprietor of the Trade Mark 'THAYAR' particularly in respect of the goods falling under class 30. The Defendant has never made false description and has not misled as if the goods of the Defendants are connected to the Plaintiff. In fact, for the past seven years, the Plaintiff has been purchasing the wet flour products from the Defendant without making any claim, but suddenly they are making false and frivolous claims.
l. The Defendant was the first adopter of the Trade Mark 'THAAYAR' in respect of wed idly/ dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly powder and other allied goods falling under class 30. The Plaintiff has commenced in respect of wet idly flour recently in the month of March 2007 to the knowledge of the 1st Defendant using the offending Trade Mark 'THAYAR' which is identical, similar and deceptively similar to that of the first defendant's reputed Trade Mark 'THAAYAR'. The registration of the Trade Mark 'THAYAR' by the Plaintiff cannot confer any better right than the rights of the first Defendant acquired by way of honest adoption and extensive use of the Trade Mark 'THAAYAR' since 1997. The Plaintiff has not established any case much less a prima facie case. Nevertheless, the balance of convenience is also in favour of the Defendants. In such circumstances, the suit is liable to be dismissed.
6. The 1st Defendant in CS.No.196/2007 has filed CS.No.300/2007 for the reliefs as stated above, reiterating the averments made in the written statement filed in CS.No.196/2007. It is further averred in CS.No.300/2007 as follows:-
a. The Defendant has no manner of any right over the Trade Mark 'THAAYAR' in respect of food products falling in class 30 as, the Plaintiff is the absolute Proprietor of the said Trade Mark in respect of the said goods falling under class 30. The Defendant is very well aware that the Plaintiff is the absolute Proprietor of the Trade Mark since they have been purchasing wet idly/ dosa flour, wet adai flour, wet rava dosai flour, wet rava idly flour, dry idly powder from the Plaintiff and marketing the same to the public until November 2006. The use of the offending Trade Mark by the Defendant would cause considerable confusion and deception in the market and the customers would be made to believe that the products of the Defendant also emanate from the Plaintiff and they would be mislead to purchase the products of the Defendants as that of the Plaintiff. The Plaintiff's Trade Mark under No.1328933 in class 30 was published in the Trade Marks Journal 1336(S1) dated 15.11.2005. So far there is no opposition to the said Trade Mark by anyone including the Defendant and the said Trade Mark of the Plaintiff is deemed to have been registered and the Plaintiff is the registered Proprietor of the Trade Mark in application No.1328933 in class 30. Thus, the Defendant has committed serious offence by infringing the Plaintiff's Trade Mark and passing off their products as that of the Plaintiff to make illegal profits. The Plaintiff will be put to serious loss, hardship and injury which cannot be compensated in terms of money if the Defendant is not restrained from marketing their products under the Trade Mark 'THAYAR' being not upto the standards of the Plaintiff and the hard earned reputation and good will of the Plaintiff would be ruined. Hence, this suit has been filed for the reliefs as stated above.
7. In the Written Statement filed in CS.No.300/2007, it is averred as follows:-
a. The Defendant denied the averments made in paragraphs 2 and 3 of the plaint. The Plaintiff is fully aware of the fact that the Defendant has been carrying on the business under the trade name of Thayar Dairy, which has already become a well known name in the trade as that of the Defendant, since 1927. The Defendant has already filed CS.No.196/2007 for the relief of permanent injunction. This suit is only a counter blast to the said suit. The Plaintiff is a new comer into the business and is exploiting the good name and reputation of the name 'THAYAR' earned by the Defendant and his predecessors ever since 1927. The concept of wet idly/dosa flour is not an invention of the Plaintiff. It has been traditionally available from time immemorial. The Plaintiff's entry into the market was only by reason of the Defendant's Trade Mark 'THAYAR'which the Plaintiff has achieved by using a phonetically similar name 'THAAYAR'. There is absolutely no other reason to the Plaintiff to choose the Defendant's Trade Mark and well reputed name 'THAAYAR' for his products, except to encash on the existing good name of the Defendant's Trade Mark 'THAYAR'. The Plaintiff claims that the business commenced in 1997 is wet flour, but the partnership deed in 1997 and the amended deed in 1998 disclose other products, such as, appalam, vathal, vadam, pickles, powders, etc. and the product wet flour is conspicuous by its absence. This clearly indicates the mala fide intention of the Plaintiff in infringing upon the already well established Trade Mark of the Defendant particularly in the business of appalam, vathal, vadam, pickles, powders, etc. popularly known as home link products. The certification alleged to have been taken from different agencies by the Plaintiff are not relevant to these proceedings and they are also not in the knowledge of the Defendant. These certifications in any case were only obtained in 2006. It is not the case of the Plaintiff that they obtained all the certifications in 1997 itself. This is a clear case of unjust enrichment by use of the Defendant's Trade Mark. There is no risk of acceptability because of the good will and Trade Mark 'THAYAR' which the Defendant have earned over the years, made the task easier to enrich without advertisement in the earlier years.
b. The Defendant denies the averments in paragraph 6 of the plaint. Even if such advertisements are made, they are not bona fide and made only with a view to infringe the Trade Mark of the Defendant and pass off the goods of the Plaintiff as that of the Defendant's well known Trade Mark 'THAYAR'. The allegations in paragraph 7 of the plaint are denied. It is false to state that the name 'THAAYAR' had acquired secondary meaning to represent the products of the Plaintiff alone. The Plaintiff stealthily obtained the Trade Mark 'THAAYAR' registered without the knowledge of the Defendant. The proceedings for the rectification of the register on application by the Defendant is pending before the Trade Mark authorities. Regarding the allegations made in paragraph 8 of the plaint, the Defendant states that he had applied for the Trade Mark falling in classes 29, 30, 42 and 3. The Defendant's sales tax assessment shows butter and home link sales, which include appalam, vathal, vadam, ready mix rice powders, spices, masalas, preparation of flour from cereals and pulses, rosewater, pooja oil, etc. Similarly, the averment that the Plaintiff had supplied wet flour products to the Defendant is mischievous and denied as false.
c. The averments made in paragraph 9 of the plaint are false. The Defendant's predecessor M.K.Ramanathan had also applied for registration, stating butter and home link sales and registration of 'THAYAR' in class 29 was given by the Trade Mark registry and it was also renewed till 2001. The Defendant acquired the business along with its goodwill in its entirety by way of sale in the year February 1999 and even before the same, the Defendant acquired lease hold rights in the business and goodwill right from the year 1975 and continued to use the Trade Mark and has been carrying on business till date. The averments made in paragraph 10 is false and made deliberately for the purpose of this case. M.K.Ramanathan's grandson was carrying on similar business in another name Sri Muthukrishna Stores only at the ground floor of the premises belonging to Muthukrishnan, wherein the Plaintiff is doing business as a tenant and the business was subsequently taken over by the Plaintiff and their relatives. The Trade Mark 'THAYAR' was never permitted to be used by him. In fact, this very averment by the Plaintiff will clearly establish the fact that the name 'THAYAR' was though fit to be used by the Plaintiff from the immense goodwill being enjoyed by the Defendant's business in the name Thayar Dairy in the locality that is in T.Nagar and Mambalam.
d. The Defendant denies the averments in paragraphs 11 and 12 as false. By a letter dated 25.11.2006, the Plaintiff admitted the wrongful user of the Defendant's Trade Mark, but it was falsely stated therein that in the discussions on 14.11.2006 as if the Defendant had allowed the Plaintiff to use the Trade Mark. No such discussions took place and no such agreement was ever reached between the Plaintiff and the Defendant. It was only a ruse to avoid the legal consequences of the infringement of the Trade Mark and passing off made by the Plaintiff. It was represented that Muthukrishnan the son of late M.K.Ramanathan was a partner along with the Plaintiff and hence, to avoid litigation, there were some proposals to settle the matter amicably. No consensus was reached and the proposals were dropped at that stage itself. In any case, these mediations were never initiated by the Defendant and only the Plaintiff pressed for the mediation using the said Muthukrishnan as a tool to mislead the Defendant. The Defendant denies averments in paragraph 13 as false. The expenses statement and the bills produced themselves will establish that the Plaintiff has enriched themselves due to the Defendant's Trade Mark 'THAYAR', which was a name and business built up over a period of 80 years hard work of the Defendant and his predecessor in title to the Trade Mark.
e. The averments made in paragraph 14 and 15 of the plaint are totally incorrect. The general public in 1997 when the Plaintiff started the business never associated the Trade Mark 'THAYAR' with the Plaintiff. In fact by 1997 the Trade Mark and name 'THAYAR' had been made a house hold name by the Defendant through his products painstakingly building up its reputation over a period of about 70 years upto 1997 when the sales turnover was not less than Rs.39 lakhs as compared to a mere Rs.1.53 lakhs during the same period. The Defendant states that the Plaintiff is only cashing in on the name and reputation of the Trade Mark 'THAYAR' built up by the Defendant and his predecessor. The general public always associated the business and products of the Trade Mark 'THAYAR' with the Defendant and his predecessor. The Plaintiff is only trying to fool the general public by causing confusion by using a phonetically similar name 'THAAYAR'which will be passed off as that of the long standing mark of the Defendant. The Defendant denies the averments in paragraphs 17 to 19 of the plaint. It is absolutely false to state that the Defendant has been purchasing idly/dosa flour etc. from the Plaintiff under the Plaintiff's Trade Mark 'THAAYAR' and marketing the same till November 2006. The Plaintiff is well aware that the Defendant has been marketing wet idly flour as also other products with his Trade Mark 'THAYAR' over the years much earlier than the date when the Plaintiff came into existence. The allegation in paragraph 19 of the plaint that during the third week of March 2007 the Plaintiff came to know that the Defendant all of a sudden commenced marketing wet idly flour etc. is absolutely false to the knowledge of the Plaintiff, so as to make an appearance of cause of action for this suit. There is no bona fide or rationale of adoption of their Trade Mark, to choose of the business place which is the premises owned by Muthukrishnan, son of predecessor and aligning and winning over him. They had dishonestly adopted and subsequently, entered with knowledge resulting in commercial illegality to pass off the goods as that of the Defendant.
f. The averments in paragraphs 20 to 24 are incorrect. In fact, it is the Defendant who is suffering on account of the infringement of his Trade Mark 'THAYAR by the Plaintiff and the resultant passing off of the Plaintiff's products as that of the Defendant creating confusion in the market as though the products marketed by the Plaintiff are that of the Defendant. The Defendant's application to the registry is prior to the Plaintiff. The Plaintiff thereafter approached the registry in 2005 making false representations and suppressing the fact of earlier registration by the Defendant and obtained registration illegally. The Plaintiff has no cause of action or justification to file this suit. The claim made by the Plaintiff as if they are the prior user and as if they have got the right over Trade Mark 'THAYAR' are all false and imaginary. The Trade Mark 'THAYAR' has been in use by the Defendant and his predecessor in interest from 1927 onwards and it has gained a secondary name. In fact, the Plaintiffs are very much aware that the Defendant is the owner of the Trade Mark Thayar Dairy. This Defendant has already got registration of the Trade Mark Thayar Dairy. Now, the Plaintiff dishonestly wants to use a deceptively similar name 'THAAYAR' adding one more alphabet a. The Trade Mark Thayar Dairy has been in use from 1927 onwards. In fact, one M.K.Ramanathan has been carrying on the business of 'THAYAR' Dairy from 1927. He applied for registration of the Trade Mark 'THAYAR' Dairy in the year 1987 and M.K.Ramanathan has been given the registration. In the application for registration submitted by M.K.Ramanathan, he has clearly stated that he has been continuously using the name Thayar Dairy since 1927. The Defendant has been working under M.K.Ramanathan and taking part in the business Thayar Dairy. The said M.K.Ramanathan gave the said business Thayar Dairy to the Defendant under a lease agreement dated 1.9.1975. The Defendant continued to carry on the business Thayar Dairy from 1975 of his own and with his own capital. By another memorandum of agreement dated 31.3.1981 and 15.9.1984, the said M.K.Ramanathan renewed the agreement dated 1.9.1975. The Defendant has been continuing to carry on the business Thayar Dairy and have been trading under the name and style of 'THAYAR supplying various items of food products by him which are otherwise popularly known as Home Link Products.
g. M.K.Ramanathan passed away in the year 1997, leaving behind a registered Will dated 7.2.1996 registered in the Office of the Sub Registrar, T.Nagar, as Document No.13/1996. Under the said Will, M.K.Ramanathan had bequeathed the business Thayar Dairy and Sri Muthukrishna Stores to his two sons M.R.Muthukrishnan and M.R.Chandrasekaran and has given rights to them to collect the lease rents and other amounts from this Defendant i.e. from Thayar Dairy run by this Defendant. Thus, it will be seen that after the life time of M.K.Ramanathan, his two sons became the owners of the business interest in Thayar Dairy. The Defendant continued to carry on the business under the name and style of Thayar Dairy using the Trade Mark Thayar Dairy even after the demise of M.K.Ramanathan. M.K.Ramanathan was a tenant in the property a No.31, Ranganathan Street, T.Nagar, Chennai 600017 where the business of Thayar Dairy was being carried on. The Defendant purchased the property at No.31, Ranganathan Street, T.Nagar, Chennai-17 from the owners by a registered sale deed dated 26.6.1998 in favour of this Defendant's son S.Ramanathan. Thereafter, the two sons of M.K.Ramanathan, namely, M.R.Muthukrishnan and M.R.Chandrasekaran transferred their interest in the said business Thayar Dairy in its entirety in favour of this Defendant and his son Ramanathan for a total consideration of Rs.50,000/- with effect from 2.1.1999. The said Muthukrishnan and Chandrasekaran have also executed sale deed transferring all their business interest in Thayar Dairy in favour of the Defendant's son Ramanathan. Thereafter, the Defendant's son gave the business interest to this Defendant and requested this Defendant to carry on the business as sole Proprietor and the Defendant has been carrying on the business Thayar Dairy as Proprietor thereof with effect from May 1999. The Defendant applied for licence to the Corporation of Madras and the Corporation issued the licence on 24.5.1999 in favour of this Defendant and this Defendant has been continuing the business of Thayar Dairy using the Trade Mark Thayar Dairy.
h. The Trade Mark Thayar Dairy has been used by M.K.Ramanathan from 1927 onwards and this Defendant continues to carry on the business Thayar Dairy which includes the Trade Mark 'THAYAR'. This Defendant has also got registration under the Tamil Nadu General Sales Tax Act as Proprietor of Thayar Dairy. In the year 2002-2003, this Defendant wanted to apply for renewal of the Trade Mark Thayar Dairy for which late M.K.Ramanathan got the registration. Then, this Defendant came to know that since late M.K.Ramanathan passed away in 1997 the registration had not been renewed and this Defendant was advised that he can only apply for fresh registration. This Defendant states that he has been continuously using the Trade Mark Thayar Dairy and carrying on business in the Home Link Products. Since this Defendant was advised to apply for fresh registration under the Trade Marks Act, 1999, this Defendant took steps for applying for fresh registration. Originally, the Defendant has been dealing in dairy products and other allied items. Subsequently, this Defendant started trading in flour operations also. But, the business Thayar Dairy with the Trade Mark Thayar Dairy has been under continuous use from 1927 onwards by his predecessor M.K.Ramanathan and subsequently by this Defendant. This Defendant applied for registration of the Trade Mark Thayar Dairy under Clause 3,29, 30 and 42. In fact, in the affidavit filed before the Registrar of Trade Marks, filed on 10.8.2004, this Defendant has clearly traced the adoption of Thayar Dairy from 1927 and its continuous use by this Defendant.
i. The Trade Mark registry directed the Defendant to advertise his application and this Defendant had duly advertised the same. After following the formalities, the Defendant has been given registration certificate dated 23.9.2005 with effect from 21.6.2004 in Clause 29, 30 and 42. In so far as registration under clause 3 is concerned, the Defendant is awaiting registration. The Plaintiff cannot infringe into the Defendant's Trade Mark 'THAYAR' by adding one more alphabet a which is misleading and phonetically similar to the Defendant's Trade Mark. This Defendant states that he is the Proprietor of Trade Mark 'THAYAR' with respect to foodstuffs which include milk and other dairy products, ghee, butter, edible oils, pickles, jellies, jams, appalams, spices, masalas, sambar, rasam and turmeric powders, sugar, rice, tapioca, sago, flour preparations from cereals, mustard, pepper, coriander, tamarind etc. The Defendant has been retailing and marketing in dairy and food products using the Trade Mark 'THAYAR' for several decades. It is also an admitted fact that the Trade Mark 'THAYAR' is registered under the Trade Marks Act 1999 in various classes viz. 29, 30, 42 and 3 in the name of 'THAYAR' in respect of the aforesaid goods and services. The Trade Mark 'THAYAR' has become very popular and attained much valuable reputation in the market from 1927 by his predecessor and continued by this Defendant till date.
j. The Plaintiff has fraudulently and on suppression of the Defendant's Trade Mark registration, of which the Plaintiff is aware, obtained registration certificate in respect of the phonetically similar name, when there is an existing Trade Mark registration in the name of the Defendant on the very same Trade Mark. In the application said to have been filed by the Plaintiff, the Plaintiff claims that they have been using the Trade Mark from 5.5.1997. They have stated that the name of the business THAYAR Food Products. They cannot ask for registration of the Trade Mark 'THAYAR' since the Defendant is the absolute owner of the said registered Trade Mark Thayar Dairy continuously from 1927 onwards, by the Defendant and his predecessor in interest. In paragraph 10, the Plaintiff admits that M.K.Ramanathan was the founder of Thayar Dairy. An allegation is made that the said M.K.Ramanathan permitted his grandson Santhanakrishnan to carry on business in the same Trade Mark Thayar Dairy at No.20, Hanumar Koil Street, West Mambalam, and that the business is carried on by the legal heirs of M.K.Ramanathan. This is false. What has been carried on at No.20, Hanumar Koil Street, West Mambalam, Chennai-33, was a small grocery stores under the name and style of Sri Muthukrishna Stores. That alone was given to Santhanakrishnan and he passed away recently. In fact, the said Sri Muthukrishna Stores was run by late Santhanakrishnan at No.20, Hanumar Koil Street, West Mambalam, Chennai-33. After the demise of Santhanakrishnan, his mother has been running the said grocery stores and the Plaintiff has been trying to win over M.R.Muthukrishnan to commit illegality and infringe the Defendant's Trade Mark Thayar Dairy. During the pendency of the suit, some attempts were made to put up a board with the name Thayar Dairy by some vested interests at the address were Sri Muthukrishna Stores functioned at West Mambalam. This clearly shows that the Plaintiff has not come to court with clean hands and they are trying to commit illegalities and trying to unjustly enrich themselves and trying to pass on their goods under the Trade Mark Thayar Dairy, of which the Defendant is the absolute owner.
k. In Muthukrishna Stores at No.20, Hanumar Koil Street, West Mambalam, the Plaintiffs have put a new Board Thayar Dairy . Muthukrishna Stores at No.20, Hanumar Koil Street was also owned and run by M.K.Ramanathan Iyer, who has leased out the shop Muthukrishna Stores to S.Santhanakrishnan (S.S.Krishnan). The lease agreement dated 1.10.1984, which was handed over to the Defendant by late M.K.Ramanathan will establish this fact. Now the Plaintiff has realized that he has no defence to the Defendant's suit in CS.No.196/2007. The Defendant is now trying to create documents by trying to win over M.R.Muthukrishnan. M.R.Muthukrishnan has evicted his sister Mrs.Thirupurasundari (mother of Santhanakrishnan) from No.20, Hanumar Koil Street, West Mambalam. The Plaintiff has been instigating M.R.Muthukrishnan to infringe the Defendant's Trade Mark Thayar Dairy. The Plaintiff now wants to do the mischief of infringing the Defendant's Trade Mark Thayar Dairy through M.R.Muthukrishnan and wants to indulge in passing off. This clearly shows the high handedness on the part of the Plaintiff. The Plaintiff is indulging in illegality even while the suit is pending. The Plaintiff wants to unjustly enrich themselves and cause wrongful loss to the Defendant by infringing his Trade Mark Thayar Dairy and indulging in illegality to pass off the Plaintiff's goods under the Defendant's Trade Mark Thayar Dairy. The Plaintiffs themselves claim user from only 1997. The Defendant is claiming user from 1927 continuously by the Defendant and by his predecessor in interest. The issue is not whether wet idly, dosa, adai flour can be sold by anyone. The issue is who is the owner of the Trade Mark Thayar Dairy and who is the prior user. Anybody can sell wet idly, dosa and adai flour or any other products. But, the Defendant has got exclusive right to use the Trade Mark Thayar Dairy and the registration certificate issued to the Defendant to the same is very much prior to that of the Plaintiff. The Plaintiff's action is dishonest. The Plaintiff knows very well that the Defendant is the prior user of the Trade Mark Thayar Dairy which business has got a reputation and it has obtained a secondary meaning and everyone identifies the products of Thayar Dairy with the Defendant and nobody else. For the purpose of his business, the Defendant used to prepare wet idly, dosa and adai flour on his own and he also used to get it done from other sources and he would pack and market it under the name and style of Thayar Dairy. The Defendant is having the exclusive right to market the food products under the Trade Mark Thayar Dairy .
l. The Plaintiff cannot infringe the Defendant's Trade Mark Thayar Dairy nor pass of its goods by infringing the Trade Mark Thayar Dairy. The word 'THAAYAR'used by the Plaintiff, adding one alphabet a is phonetically and deceptively similar to the Defendant's Trade Mark 'THAYAR' and it is clear that the action of the Plaintiff is dishonest. The customers will be misled. Only after filing of the suit, the Defendant came to know that the Plaintiff had made some attempts to get registration of the Trade Mark THAYAR. Immediately on coming to know of the same, the Defendant has sent objections to the Trade Marks Registry and the Defendant has taken steps for cancellation of the registration that the Plaintiff has obtained by misrepresentation and by suppressing of the prior registration of the Trade Mark Thayar Dairy in favour of the Defendant. Some documents have been produced stating that he is supplying wet idly and adai flour to 'THAYAR', T.Nagar and the invoices say that it is from Thai Food Products. The Plaintiff is 'THAYAR Food Products'. It is not known what is the connection between Thai Food Products and the Plaintiff. Now, the Plaintiff admits that the Plaintiff is carrying on business under the name and style of Thayar Dairy and Thayar Dairy is clearly identified with the Defendant exclusively and nobody else. When the Defendant does not have stocks and when the customers want the product, the Defendant also used to get wet idly, dosa and adai flour from other sources but the Defendant always used to market it under the Defendant's Trade Mark Thayar Dairy. The Plaintiff is very much aware of this fact, but he wants to dishonestly infringe the Defendant's Trade Mark Thayar Dairy and wants to pass off his goods under the Defendant's Trade Mark. The Plaintiff in fact are riding piggy back on the popularity of the Defendant's Trade Mark THAYAR which is
evident even from the press interview given by the Plaintiff that it has been running the business in the name of 'THAYAR Food Products' for the past 60 years when as per their own admission, the Plaintiff has commenced operations only in the year 1997. In such circumstances, the suit is liable to be dismissed with costs.
8. On the above said pleadings, the following issues were framed separately in both suits for determination:-
(A) CS.No.196/2007:-
a. Whether the Plaintiff is the registered Proprietor of the trade mark?

b. Whether the Defendants are the prior users of the trade mark "'THAYAR'"?

c. Whether M.K.Ramanathan adopted the trade mark "'THAYAR'" from 1927 and whether it was assigned in favour of the Plaintiff?

d. Whether the Defendants are guilty of infringement?

e. Whether the Defendants are guilty of passing off?

f. To what other reliefs, the Plaintiff is entitled to?

(B) CS.No.300/2007:-

a. Whether the Plaintiff is the registered Proprietor of the trade mark?

b. Whether the Defendant is the prior user of the trade mark having got it assigned from one M.K.Ramanathan?

c. Whether the Defendant has infringed the Plaintiff's trade mark?

d. Whether the Defendant is guilty of passing off?

e. To what other reliefs, the Plaintiff is entitled to?
9. In both the suits, common evidence is recorded. The Plaintiff in CS.No.196/2007 examined himself as PW.1 and marked Exs.P1 to P38. The 4th Defendant in CS.No.196/2007 was examined as DW.1 and Exs.D1 to D32 have been marked.
10. Hereinafter, for the purpose of convenience, the parties are referred to as they are arrayed in CS.No.196/2007.
11. Issues (a) and (d) in CS.No.196/2007 and Issues (a) and (c) CS.No.300/2007:-
The Plaintiff filed the above suit in CS.No.196/2007 inter alia on the strength of the registration under the Trade Marks Act 1999 obtained by him in respect of THAYAR label registered under No.1291574 in class no.30. The 1st Defendant (THAYAR Food Products), after receipt of summons in the above suit, filed an application in ORA.No.117/2007/TM/CH before the Intellectual Properties Appellate Board (IPAB) for rectification of the Register of the Trade Marks by cancelling the registration granted to the Plaintiff (THAYAR Dairy) under No.1291574 in class 30. The IPAB by order dated 11.9.2009, marked as Ex.D24, allowed the said application and directed the Registrar of Trade Marks to remove the Trade Mark registered under No.1291574, against which the Plaintiff filed a writ petition in WP.No.16746/2010 and a Division Bench of this court, after admitting the writ petition, stayed the order of IPAB made in ORA.No.117/2007/TM/CH.
12. Similarly, the Plaintiff filed an application before the IPAB in ORA.No.185/2009 for rectification of the Register of Trade Marks by cancelling the registration of the 1st Defendant's Trade Mark 'THAAYAR' under No.1328933 in class no.30 and the same was dismissed, thereby sustaining the registration of the 1st Defendant's Trade Mark ''THAAYAR''.
13. A single Judge of this court in OA.No.744/2007 passed an order of injunction against the Defendants from continuing or repeating the infringement of the Plaintiff's Trade Mark ''THAYAR''. However, the application in A.No.4277/2007 filed by the Plaintiff for cancellation and withdrawal of the 1st Defendant's Trade Mark under registration No.1328933 in class 30 was directed to be considered at the time of final suit proceedings. Aggrieved against the aforesaid orders passed by the learned single judge, the Defendants preferred appeals in OSA.No.277 to279/2007 wherein the Division Bench allowed OSA.No.279/2007 filed against the order granting injunction in OA.No.744/2007, however, directed the Defendants to deposit a sum of Rs.10 lakhs as security every year to the credit of the suit. The Division Bench further directed that the suits should be expedited.
14. In view of the aforesaid factual position as on this date, both the Plaintiff and the Defendants are the registered Proprietors of their respective Trade Marks and therefore, the relief claimed by both parties in respect of infringement of the Trade Mark as against each other is barred under Section 28(3) of the Trade Marks Act 1999.
15. In Uniply Industries Limited Vs. Unicon Plywood Pvt Limited (AIR-2001-SC-2083), there were two separate suits that had been filed, complaining of similar Trade Marks against each other as in this case. The Honourable Supreme Court, in this regard, concluded that the court should have been restrictive in granting the injunction and that when both sides have applied for registration, injunction should not be granted in favour of either person. The Honourable Supreme Court observed thus:-
It is this state of materials, the courts below should have been wary and cautious in granting an injunction which would affect the trade and business of another person using an identical Trade Mark. Both the Appellant and the Respondents have applied for registration of their respective Trade Marks before the Registrar under the Trade and Merchandise Marks Act, 1958 and the respective rights of the parties will have to be investigated by the Registrar and appropriate registration granted to either of them or both of them, as the case may be, bearing in mind the provision of Section 12(3) of the Trade and Merchandise Marks Act, 1958. There are many precedents to the effect that for inherently distinctive marks ownership is governed by the priority of use of such marks. The first user in the sale of goods or service is the owner and senior user. These marks are given legal protection against infringement immediately upon adoption and use in trade if two companies make use of the same trade mark and the gist of passing off in relation to goodwill and reputation to goods.
16. Ultimately, the injunction prayed was refused holding that the appropriate order to be made is that injunction either in favour of the Appellant or against them or vice-versa is not appropriate and the proceeding in the suit shall be conducted as expeditiously as possible or the Registrar, under the Trade and Merchandise Marks Act, 1958, may decide the matter which may govern the right of the parties. In the light of the observations made by the Honourable Supreme Court in a similar situation, in the instant case, it is not appropriate for this court to grant reliefs as prayed for by the parties against each other in respect of the issues (a) and (d) in CS.No.196/2007 and Issues (a) and (c) CS.No.300/ 2007 and it is left open to the parties to pursue their remedy in the appropriate forum. The above said issues are answered accordingly.
17. Issues (b), (c) and (e) in CS.No.196/2007 and Issues (b) and (d) in CS.No.300/2007:-
The case of the Plaintiff is that the name Thayar Dairy was used since 1927 by his predecessor M.K.Ramanathan and he was carrying on the business in Ranganathan Street, T.Nagar, Chennai in the name and style of 'THAYAR' Dairy. The Plaintiff joined as a worker at the age of 14 to assist M.K.Ramanathan in the said business. A lease agreement was entered into between M.K.Ramanathan and the Plaintiff to lease out the business 'THAYAR' Dairy at No.1A, Ranganathan Street, T.Nagar on 1.9.1975 in Ex.P15 and the same was renewed by deeds dated 31.3.1981 and 15.9.1984 marked as Ex.P16 and Ex.P17. The Trade Mark 'THAYAR' Dairy was registered in class 29 claiming user since 1927 by the predecessor of the Plaintiff as early as in the year 1987 and it was renewed till 2001. The predecessor of the Plaintiff M.K.Ramanathan was also running a business in the name and style of Sri Muthukrishna Stores at No.9, Hanumar Koil Street, West Mambalam, Chennai-33. A lease deed was executed by M.K.Ramanathan under Ex.P20 dated 1.10.1984 in favour of one S.S.Krishnan in respect of Sri Muthukrishnan Stores, vending ghee, butter and other home links.
18. The said M.K.Ramanathan died in the year 1997 i.e. on 2.1.1997 and he left a registered Will dated 7.7.1996 allowing his legal heirs (sons) namely M.R.Muthukrishnan and M.R.Chandrasekar to run the business directly or to lease it to others and share the rent or to dispose of the said business. The son of the Plaintiff, who was the leaseholder purchased the premises housing 'THAYAR' Dairy from the two sons of M.K.Ramanathan. A sale deed is said to have been executed by M.R.Muthukrishnan and M.R.Chandrasekar in favour of S.Ramanathan, son of the Plaintiff selling the business and ownership of 'THAYAR' Dairy with its entirety and thereby transferred all their interest in the said business to the Plaintiff. Ex.P28 is the confirmation letter executed by the both the sons of the predecessor of the Plaintiff, confirming the sale of the business 'THAYAR' Dairy in favour of the Plaintiff.
19. An application for registration of Trade Mark 'THAYAR' in class 03, 29, 30 and 42 under the Trade Marks Act 1999 was made by the Plaintiff and it is not in dispute that registration certificate for the Trade Mark 'THAYAR' in class 30 for appalam, sambar, rasam powder and flour preparations from cereals, etc. has been granted in Ex.P2. Likewise, registration certificate for the Trade Mark 'THAYAR' in class 42 for retail store and super mark has been granted in Ex.P3. Similarly, registration certificate fro the Trade Mark 'THAYAR'in class 29 for butter, ghee and dairy products has been granted in Ex.P1.
20. It is alleged by the Plaintiff that he came to know the infringement of the Trade Mark 'THAYAR'by the Defendant from their advertisements in Mambalam Times and in the supplementary Thozhil Malar of Daily Thanthi Newspaper. There were exchange of notices between the parties before filing their respective suits.
21. It is needless to say that the suit is being contested on behalf of the Defendants. The case set up by the Defendant is that the Plaintiff is not the Proprietor of the Trade Mark 'THAYAR'and neither he is prior user nor earned any reputation for the alleged Trade Mark. The Defendant (THAYAR Food Products) by adoption and extensive use since 1997 and wide publicity is the absolute and exclusive Proprietor of the Trade Mark 'THAAYAR. It is distinctive of the Defendants 'THAYAR' Food Products and has earned good reputation. Further, the Defendants have even supplied wet flour products under the Trade Mark 'THAAYAR' to the Plaintiff for more than seven years. Hence, the Plaintiff acquiesced the Defendant's use of Trade Mark 'THAAYAR'.
22. At the outset, I may mention that it is not in dispute that the Defendants have been using the Trade Mark THAAYAR from 1997 onwards. It is also not disputed that the predecessor of the Plaintiff was carrying on the business in provisions and general stores in the name of THAYAR' Dairy. It is the case of the Defendants that neither the Plaintiff nor his predecessor was marketing/vending any product using the Trade Mark "THAYAR" for the products. It is contended that running a provision store under the trading style of THAYAR' Dairy will not amount to applying and using the Trade Mark on the goods retailed. It is further contended that the predecessor of the Plaintiff M.K.Ramanathan himself was not the Proprietor of the Trade Mark 'THAYAR' with respect to any food preparations and therefore, the Plaintiff cannot claim to be the prior user of the Trade Mark in respect of food preparations.
23. It is common in trade and business for a trader or a businessman to adopt a name and/or mark under which he would carry on his trade or business. According to Kerly (Law of Trade Marks and Trade Names, 12th Edition, Paragraph 16.49) the name, under which a business trades, will almost always be a Trade Mark (or if the business provides services, a service mark, or both). Independently of questions of trade or service mark, however the name of a business (a trading business or any other) will normally have attached to it a goodwill that the courts will protect. In such view of the matter, an action for passing off would lie whenever the Defendant's Company's name is calculated to deceive and so to divert business from the Plaintiff or to occasion a confusion between the two businesses.
24. At this juncture, it will be useful to have a general view of certain statutory definitions as incorporated in the Trade Marks Act 1999. The definition of Trade Mark is very wide and means, inter alia, a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others. Section 2(1)(m) defines 'Mark' as below:-
Mark includes a device, heading, label, ticket, name, signature, word, letter, numeral, shake of goods, packaging or combination of colours or any combination thereof:
So Mark includes amongst other things name or word also. Section 2(1)(zb) defines trade mark as below:-
trade mark means a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colours; and

(i) in relation to Chapter XII (other than section 107), a registered trade mark or a mark used in relation to goods or services for the purpose of indicating or so as to indicate a connection in the course of trade between the goods or services, as the case may be, and some person having the right as proprietor to use the mark; and

(ii) in relation to other provisions of this Act, a mark used or proposed to be used in relation to goods or services for the purpose of indicating or so to indicate a connection in the course of trade between the goods or services, as the case may be and some person having the right, either as proprietor or by way of permitted user, to use the mark whether with or without any indication of the identity of that person, and includes a certification trade mark or collective mark:
This definition has enlarged the scope of trade mark to mean a mark capable of being represented graphically and to include shape of goods, their packaging and combination of colours. The expression would apply to both goods and services.
25. A person may sell his goods or deliver his services such as in case of a profession under a trading name or style. With the lapse of time, such business or services associated with a person acquire a reputation or goodwill which becomes a property which is protected by courts. The law does not permit any one to carry on his business in such a way as would persuade the customers in believing that the goods or services belonging to some one else are associated with therewith. It does not matter whether the latter person does so fraudulently or otherwise. The reasons are two. Firstly, honesty and fair play are and ought to be the basic policies in the world of business. Secondly, when a person adopts or intends to adopt a name in connection with his business or services which already belongs to some one else, it results in confusion and has propensity of diverting the customers of some one else to himself and thereby resulting in injury.
26. In Oertli Vs. Bowman (1957-RPC-388-CA) at page 397 the gist of passing off action was defined by stating that it was essential to the success of any claim to passing off based on the use of given mark or get up that the Plaintiff should be able to show that the disputed mark or get up has become by user in the country distinctive of the Plaintiff's goods so that the use in relation to any goods of the kind dealt in by the Plaintiff of that mark or get up will be understood by the trade and the public in that country as meaning that the goods are the Plaintiff's goods. It is in the nature of acquisition of a quasi proprietary right to the exclusive use of the mark or get up in relation to goods of that kind because of the Plaintiff having used or made it known that the mark or get up has relation to his goods. Such right is invaded by anyone using the same or some deceptively similar mark, get up or name in relation to goods not of Plaintiff. The three elements of passing off action are the reputation of goods, possibility of deception and likelihood of damages to the Plaintiff. In our opinion, the same principle, which applies to the Trade Mark, is applicable to trade name.
27. In the present case, the Plaintiff claims that his predecessor M.K.Ramanathan has been running his business in the name and style of THAYAR Dairy since 1927. He has produced Ex.P15 a lease agreement entered into between M.K.Ramanathan, Proprietor of THAYAR Dairy and the Plaintiff in respect of the business run by M.K.Ramanathan THAYAR' Dairy at No.1A, Ranganathan Street, T.Nagar. Ex.P16 and Ex.P17 would evidence the factum of renewal of lease periodically till the year 1985. Ex.P21 is the receipt and application made to the Trade Mark Registry by M.K.Ramanathan claiming user since 1927 for Thayar Dairy under Trade Marks Act 1958. Ex.P22 evidences the allotment of application number 478710 by Trade Mark Registry in favour of M.K.Ramanathan. An affidavit filed by M.K.Ramanathan to the Trade Mark Registry claiming continuous user of the trade mark Thayar Dairy trading in butter, ghee and dairy products showing sales turn over of butter and home link products from 1979 is marked as Ex.P23. Advertisement made in the Trade Mark Journal by M.K.Ramanathan and its receipt is marked as Ex.P24. Ex.P25 is the Trade Mark certificate issued on 15.11.1994 under the Trade Marks Act for Thayar Dairy for class 29 in respect of butter, ghee and all dairy products. It is seen that in Ex.P26 notice, renewal notice has been sent by the Trade Mark Registry to M.K.Ramanathan for registration of the Trade Mark Thayar Dairy in no.478710 for a period of seven years requiring an application being filed with the prescribed fee of Rs.300/- on or before January 1995. The receipt dated 8.2.1995 issued in the name of M.K.Ramanathan by Trade Mark Registry for a sum of Rs.300 (Ex.P26) would show that the Trade Mark Thayar Dairy was renewed for a further period of seven years i.e. till 2001.
28. In the meanwhile, M.K.Ramanathan died and as per the registered Will dated 7.2.1996 marked as Ex.P27, his sons M.R.Muthukrishnan and M.R.Chandrasekar were allowed to run the business Thayar Dairy directly or by leasing it out to the Plaintiff and share the rent or to dispose of the said business to run the business. It is claimed by the Plaintiff that the premises housing Thayar Dairy was purchased by the Plaintiff in the name of his elder son S.Ramanathan and a sale deed was also executed by the sons of M.K.Ramanathan transferring business in the name and style of Thayar Dairy as a group concern in favour of the Plaintiff. Ex.P28 is the confirmation deed executed by the two sons of predecessor of the Plaintiff whereby they have confirmed the transfer of ownership of Thayar Dairy at 31, Ranganathan Street, Chennai, in favour of the Plaintiff. The aforesaid documents proved that the Plaintiff, who was running the business since 1975 as a leaseholder, had become an absolute owner of the business THAYAR' Dairy in the year 1999.
29. The Defendant admits the fact about the existence of Thayar Dairy and also admits his knowledge of the Plaintiff's trading under the name of "THAYAR". Evidently, the Trade Mark "THAYAR" was adopted by M.K.Ramanathan and it was assigned as a running concern in favour of the Plaintiff. The Defendants had adopted the Trade Mark "THAYAR" from 1997 in respect of wet batters and other allied goods falling under class 30. They have not assigned any reason for adopting the Trade Mark "THAYAR". It is well settled that if the Defendant had knowledge about the Plaintiff's Trade Mark, then the subsequent user of the Defendant if any would be at its own peril and it cannot be construed as bona fide user on the part of the Defendant. In passing off action what is to be considered is who is the prior user of the Trade Mark since the prior use is a decisive factor.
30. In M.Mohinder Singh Shah Vs.Tiruchi Flour Mills (1997-2-Andh-LW-251) the prior use was considered to be the relevant, because during such a period, consumers or purchasers must have found that quality of a particular product associated with a particular brand name either is good or bad and using a similar trade name or mark by two different persons would definitely cause confusion in the minds of the consumers and in such circumstances, the sale of goods by the person using the Trade Mark latter may tantamount to passing off.
31. In this case, the Defendant himself knows that Thayar Dairy is functioning at Ranganathan Street, started by M.K.Ramanathan and continuously run by the Plaintiff herein. Having known the above, the Defendant applies for registration under class 30 for the deceptively, phonetically similar mark and succeeds in getting registration. Admittedly, the Plaintiff is the prior user and the registration is at earlier point of time applied in 2004. The very fact that the Plaintiff has applied for registration of "THAYARh" under several classes goes to show that he is vigilant to protect his right. In the affidavit sworn before the Registry by the Plaintiff, he claims user since 1927 by his predecessor in title and then by him. Therefore, M.K.Ramanathan from 1927 and thereafter, the Plaintiff continuously had taken steps to protect the Trade Mark and the trade name THAYAR". There is no abandonment or acquiescence or negligence on the part of the Plaintiff.
32. The Plaintiff has proved that the Trade Mark which he has been using on the goods has assumed a vendible character. Further, he has been using the said mark from before it was used by the Defendants. Obviously, his goods are identified and recognised by the use of the said Trade Mark "THAYAR" and the Defendant has started using the said mark from the year 1997 onwards which is deceptively similar to the said Trade Mark.
33. The statement of the Defendant's business shows a steep rise in their trade which is because of the usage of the Plaintiff's trade name. That apart, the Plaintiff's and Defendant's business are very near in the vicinity bearing the same name and also marketing co-related products. The Plaintiff's Trade Mark "THAYAR" is with respect to butter, ghee and home link products which includes appalam, pappadam, vathal, vadam, pickles and products derived out of cereals and flours etc. Whereas the Defendants adopted the Trade Mark "THAYAR" in the year 1997 in respect of wet idly/dosai flour and other allied products.
34. Ex.D1 and D9 are the unregistered partnership deed executed on 22.5.1997 and 22.11.1998 to carry on the business of vadams, appalams, vathals and allied consumer products. There is no mention about the wet flour business rather all the products mentioned therein are the same products which the Plaintiff has been trading. DW.1 has admitted in his cross examination about the same and further deposed that the names of the products mentioned in Ex.D1 and D9 differ from the name of products mentioned in Ex.D13, the permanent registration certificate dated 19.4.2006. In Ex.D2 certificate of registration issued under the Tamil Nadu General Sales Act, 1959 issued in the name of THAYAR Food Products at No.9, Hanumar Koil Street, West Mambalam, name of products manufactured under the said brand name are mentioned. It clearly indicates that the inception of business by the Defendant firm is aimed to usurp the name of "THAYAR" and later it is claimed "THAAYAR". Even Ex.D3 CST certificate issued in the name of 'THAYAR' Food Products specifically mentions only the business resale of vadams, pappadams, appalams, vathal, pickles and allied products.
35. Mr.Prabakar Reddy, the learned counsel for the Defendants submitted that the predecessor of the Plaintiff M.K.Ramanathan was only carrying on business in provision and general stores in the name of Thayar Dairy and that the Plaintiff was not applying the Trade Mark "THAYAR" in respect of any goods leave alone goods falling under description of goods in class 30 and thus he would contend that running a provision store under the trading style Thayar Dairy would not amount to applying and using the Trade Mark on the goods retailed. The learned counsel contended referring to Ex.D32 licence issued by the Corporation of Chennai in favour of the Plaintiff that the Plaintiff has applied and obtained licence only for dealing in dairy products. He would further contend that the Plaintiff's predecessor himself was not the Proprietor of the Trade Mark Thayar with respect to any food preparations and therefore, the Plaintiff cannot claim to be the prior user of the Trade Mark in respect of food preparations.
36. It is to be pointed out here that there is no requirement that the Defendant should be carrying on a business which competes with that of the Plaintiff or which would compete with any natural extension of the Plaintiff's business. In passing off action, it is not material that the Plaintiff and the Defendants trade in the same field or trade in different products. To demand a common field of activity would not only be incompatible with the growing trend towards diversification in business, but also foist on unwarranted limitation on a tort based supply on the prejudice to goodwill from practices that are actually calculated to confuse.
37. In Prakash Glass and Rubber Works Vs. Hindustan Safety Glass Works Pvt. Limited (2006-2-CHN-555), it is held that with the changed concept of passing off, it is now not material for a passing off action that the Plaintiff and the Defendant should trade in the same field... The Trade Mark law is not to protect a person who deliberately tries to take the benefit of one's reputation with regard to its goods.
38. The absence of common field of activity therefore is not fatal. The Plaintiff does not have to be in direct competition with the Defendants to suffer injury from the use of its trade name by the Defendants. In Daimler Benny Aktiengesellschaft vs. Hybo Hindustan (AIR-1994-Del-239) where the Plaintiff's Trade Mark was MERCEDES BENZ in relation to vehicles, the court granted injunction restraining the Defendant from using the trade name BENZ as well as three pointed human being in a ring in respect of under garments. On appeal, the single judge order was confirmed by the Honourable Supreme Court.
39. It is now well settled that the court has jurisdiction to restrain a Defendant from using a Trade Mark colourably resembling that of the Plaintiff, if the Defendant's trade name, though innocently adopted, is calculated to deceive either (a) by diverting customers from the Plaintiff of the Defendant or (b) by causing a confusion between the two businesses e.g. by suggesting that the Defendant's business is an extension, branch or agency or otherwise connected with the Plaintiff's business. In that behalf, a reference may be made to a paragraph at page 392 of Kerly's Law of Trade Marks and Trade Names which again contains a useful discussion on the circumstances under which a trader trading under a name resembling or including another's trade mark, can be restrained from doing so. The position in law appears to be that a Plaintiff is entitled to an injunction against the user of the Plaintiff's mark in the Defendant's trading style if such use leads to its application to the Defendant's goods. This is because that if the Trade Mark is inherently distinctive one, most customers of the Plaintiff will assume that any company with that mark in its name, as in this case is either an off-shoot of the owner of the mark or that the owner having changed its name.
40. There is also a catena of decisions reiterating this legal position of which few are mentioned hereunder:-
1.Ellora Industries Vs. Banarasi Dass (AIR-1980-Delhi-254).
2.Sarabhai International Limited Vs. Sara Exports International (AIR-1989-Delhi-134).
3.Poddar Tyres Limited Vs. Bedrock Sales Corporation Limited and another (AIR-1993-Bombay-237).
4.Bata India Limited Vs. Pyarelal and Co. (1986-10-IPLR-385).
41. In Ellora Industries Vs. Banarasi Dass (AIR-1980-Delhi-254), it has been held by a learned single judge that confusing customers as to source, as in this case, is an invasion of another's property rights. The unfairness arises from the fact that the purchasing public are likely to be ousted.
42. In Sarabhai International Limited Vs. Sara Exports International (AIR-1989-Delhi-134), it has been held as under:-
10. It is well established principle of law that if, in fact, the use of the name does lead to the result that that persons goods are being passed off as the goods of another, although that may not have been the intention of the person so using that name, and although he may have a perfectly honest reason for using it, yet if in fact the use of the name which the Defendant makes is such that it leads or must lead, to a misrepresentation that the goods of the Defendant are the goods of the Plaintiff, then prima facie the Defendant cannot be held to be entitled to use his name, although it is his own name and although he has not, and may never have had, any fraudulent intention. In the present case, the Defendant having came on the scene at quite late stage, use to the name of his daughter 'Sara' cannot be said to be a bona fide one.
43. In Bata India Limited Vs. Pyarelal and Co. (1986-10-IPLR-385), a learned single judge of Allahabad High Court held as hereunder:-
Merely because the Plaintiff in the present case is not producing foam is not enough to hold that there can be no passing off action in respect of the user of the name Bata'to the products marketed by the Defendants. The user of the name of mark 'Bata'by the Defendants is indicative of their intent. It appears that they desire to market their foam with a view to gain some advantage in a competitive market. As seen earlier, there is no plausible explanation as to why the name 'Bata'was being used by them. A passing off action would lie even if the Defendants were not manufacturing or producing any goods similar to that of the Plaintiff. A passing off action would lie where a misrepresentation is likely to be caused or a wrong impression created, as if the product was of some one else.
44. The function of a Trade Mark is to indicate the trade origin of the goods to which it is attached or in relation to which it is used. Use of a trade name could amount to use of it in connection with the goods sold. In this case, Ex.P4 photo of the Plaintiff's shop depicts the use of THAYAR in relation to goods sold by the Plaintiff. The expression connection in the course of trade in 2(1)(2b)(ii) covers wide range, eg. Manufacturer, importer or vendor as wholesaler, retailer or a person who selects or handles commercially the goods in any other way.
45. On the importance of Trade Mark to industry, the Punjab High Court observed as follows:-
The Trade Mark rights are property rights and have to be as jealously safeguarded as any other legal right of a citizen. These rights of traders, big or small, are entitled to protection. The Act aims at protecting the interest of owners of trade marks as well as interests of public. In a country like ours where industry is progressively developing, registration of a genuine, legal and valid Trade Mark may go a long way in establishing an industrial enterprise.
46. The Plaintiff has produced number of documents as referred to above that his use of Trade Mark "THAYAR'" is prior in point of time to the impugned user by the Defendant. He has placed on record, in respect of Trade Mark, the earliest registration in the name of M.K.Ramanathan, from whose heirs and successors in business, the Plaintiff had purchased the label Trade Mark "THAYAR" along with the goodwill of business. Besides the above, Ex.D14 advertisement materials produced by the Defendants, Ex.D20 the Trade Mark registration, Ex.D1 to D9 partnership deeds and amended deeds, Ex.D3 CST registration certificate clearly disclose the mala fide intention of the Defendants in acquiring the Trade Mark and name "THAYAR" of the Plaintiff. The Defendants have neither justified their adoption of "THAYAR" nor provided any evidence to substantiate such adoption, though claims to have adopted the distinctive Trade Mark "THAAYAR" since 1997. They have not produced any proof that they have used "THAYAR" since 1997 to 2004. In this regard, it is relevant to refer to the admission made by DW.1 to the effect that he has not filed any pouch to show that the Trade Mark "THAYAR'" was used by him from 5.5.1997 upto 2004. He has further admitted that he has manufactured and sold wet idly flour in the name of "THAYAR", but he has not filed the pouch in the court.
47. The learned counsel for the Defendants, in the course of his arguments put forth a new plea which of course not raised in his pleadings that the Defendant is using the Trade Mark with the consent of M.R.Muthukrishnan, one of the sons of M.K.Ramanathan. In this regard, the learned counsel pointed out to the attestation made by the said M.R.Muthukrishnan and contended that the vendors of the Plaintiff themselves acquiesced with the adoption and use of the Trade Mark "'THAYAR'" by the Defendants. It is further contended that the fact that the erstwhile owners consented in the use of the Trade Mark "THAYAR' by the Defendants and acquiesced with their user since 1997 to February 1999 before assigning the rights in the provision shop to the Plaintiff, it should be construed that the assignment of right in favour of the Plaintiff by the erstwhile owners is subject to the rights of the Defendants as acquired by them by adoption and use of the Trade Mark "THAYAR" since 1997. The learned counsel for the Defendants placed reliance on the documents placed on record on his side to support his contention.
48. I will now proceed with the document Ex.D1 referred to by the learned counsel for the Defendants in support of his contention that there is implied consent by the erstwhile owners. At the outset, the attestation of unregistered partnership deed has no relevance, as mere attestation cannot attribute knowledge of the contents of the document. It is the case of the Defendant that he used the Trade Mark with the consent of one of the sons of M.K.Ramanathan.
49. The document does not refer to the Trade Mark "THAYAR" or 'THAYAR' wet idly. There is no pleading either in the written statement filed in CS.No.196/2007 or in the plaint in CS.No.300/2007 about the alleged implied consent by the said M.R.Muthukrishnan. It is not even stated in the proof affidavit filed by the Defendant nor elicited during evidence led by the parties. Hence, the new plea raised by the Defendant for the first time in his arguments advanced before the court cannot be accepted.
50. The learned counsel for the Defendants submitted that the Plaintiff by retailing the Defendants' products under the Trade Mark "THAYAR" from 1988 to till 2006 has acquiesced with the absolute rights of the Defendant and therefore, not competent to institute the suit as provided under Section 33 of the Trade Marks Act 1999.
51. In the context of Section 33 of the Trade Marks Act 1999 to show acquiescence, it has to be proved that the Proprietor of the earlier Trade Mark was not only aware of the use of the later mark, but also by the positive acts inconsistent with the claim for exclusive rights, had acquiesced in the use of the later mark. It is for the Defendant to prove acquiescence by the Plaintiff. Acquiescence cannot be inferred merely by reason of the fact that the Plaintiff has not taken any action against the infringement of the rights. It has been consistently held that if the Defendant acts fraudulently with the knowledge that he is violating the Plaintiff's right then in that case even if there is inordinate delay on the part of the Plaintiff in taking action against the Defendant, the relief cannot be refused.
52. Ex.D7 (Series) are the copies of invoices and bills exhibited by the Defendants to show that wet idly flour under the Trade Mark "THAYAR" was supplied to the Plaintiff for more than seven years and hence, the Plaintiff acquiesced with the Defendant's use of Trade Mark "THAYAR". The copies of invoices neither contain the manufacturer's signature nor receiver's signature and seal. The Defendants are running the business under the name and style of THAYAR Food Products. But, some of the invoices pertain to Thai Food Products. It is admitted by the Defendants that they have no documents to establish "THAYAR Food Products and Thai Food Products are one and the same. It is further admitted by DW.1 that he has not filed any document to show the details of the partnership as well as the ownership of Thai Food products. No documents are filed to show that the Defendants marketed their products through Thai Food Products. Those invoices Ex.D6 and D7 cannot be relied upon to show that the Defendants were supplying wet idly mavu to the Plaintiff.
53. It has been held by the Honourable Supreme Court in Power Control Appliances Vs. Sumeet Machines Pvt Limited (1994-2-SCC-448) that acquiescence is sitting by, when another is invading the rights and spending money on it. It is of course is the conduct inconsistent with the claim for exclusive rights in the Trade Mark, trade name etc. It implies positive acts nor merely silence or inaction such as is involved in latches.
54. In the instant case, the Defendants provide no satisfactory explanation as to how they came to adopt the Trade Mark of the Plaintiff. It is well settled principle of law that if use is found to be dishonest, delay or acquiescence has no relevance. In this case, the Defendant's conduct is dishonest and fraudulent.
55. The conduct of the Defendants are dishonest which is revealed from the distorted facts submitted by the Defendants before the Trade Mark Registry for claiming registration. In Ex.P35 it is stated that the Defendants intended to register for "THAYAR idly shop in cafeterias, catering, hotels and restaurant and the place of business is given as No.9, Hanumar Koil Street, West Mambalam, Chennai. They have also claimed user since 16.9.2006 for the shop in catering, cafeteria, hotel and restaurant. But, it is admitted by the Defendant in his evidence that in spite of the declaration made by him for registering the word "THAAYAR" for catering cafeteria, hotel and restaurant, in fact they could not start the business and further admit that form 2006 onwards they were not running cafeteria, catering, hotel and restaurant etc. Ex.P35 is the Trade Mark journal advertisement of the business 'THAYAR Idly Shop for class 42 by the Trade Mark Registry under the Trade Marks Act 1999. It is admitted by the Defendant in his cross examination that they have no materials to show that they are running the said business. The relevant portion in his cross examination is extracted as hereunder:-
In Ex.P35 the user claimed since 16.9.2006 in respect of catering, cafeterias, hotels and restaurants is correct. We have claimed for running catering cafeterias, hotels and restaurants, but in fact we could not start the same. As per the advertisement in Trade Mark Journal dated 16.4.2008 under Class 42. We have no materials to show that we were running cafeterias, hotels and restaurants at No.9, Hanumar Koil Street, West Mambalam, Chennai since 16.9.2006.
56. It is the case of the Defendant that the Thayar Dairy was only a provisional store and hence, the Defendants can adopt "THAYAR" for wet idly. The Defendant knows that THAYAR Dairy is functioning at Ranganathan Street, started by M.K.Ramanathan and continuously run by the Plaintiff herein. The Defendants knowingly applies for registration under class 30 for the deceptively, phonetically similar Trade Mark and succeeds in getting registration. This act is fraudulent. The very fact that the Plaintiff, after he became the absolute owner of the business Thayar Dairy, has applied for registration in 2004 for registration of "THAYAR" under several classes goes to show that he is vigilant to protect his right. Therefore, there is no abandonment or acquiescence by the Plaintiff.
57. In Midas Hygiene Industries Limited Vs. Sudhir Bhatia (2004-5-Scale-772) the Honourable Supreme Court while setting aside the order of the Division Bench, observed that the Division Bench was entirely wrong in vacating an injunction merely on the ground of delay and laches. The Honourable Supreme Court held that the law on the subject is well settled. In case of infringement either of Trade Mark or of copy right, normally an injunction must follow. Mere delay in bringing action is not sufficient to defeat grant of injunction in such cases. The grant of injunction also becomes necessary if it prima facie appears that the adoption of the mark was itself dishonest.
58. The Delhi High Court in Hindustan Pencils Pvt Limited Vs. India Stationery Products (AIR-1990-Del-19) observed that inordinate delay or laches may be there because the Plaintiff may not be aware of the infringement by the Defendant or the Plaintiff may consider such infringement by the Defendant as not being serious enough to hurt the Plaintiff's business. Nevertheless, if the court comes to the conclusion that prejudice is likely to be caused to the general public, who may be misled, then an injunction must be issued. In the facts and circumstances of the case, I do not think it is open to the Defendant to contend that he has built up his trade, acting in good faith inasmuch as he was aware that the predecessor in title of the Plaintiff was using the trade name and Trade Mark way back from 1927 and thereafter, the Plaintiff continues to run the shop in the name of M/s.THAYAR Dairy. Therefore, the very adoption of the trade name THAYAR by the Defendants is deliberate and intentional and there is absolutely no material placed on record to indicate that the Plaintiff had no bona fide intention to trade in or manufacture all goods or articles falling under the broad classification as found in class 30.
59. In the facts and circumstances of the case, where it is established that the Defendants had lifted a substantial portion of the Trade Mark of the Plaintiff THAYAR" and uses it as a part of his trading style or trade name, the damage to the Plaintiff's good will and reputation is inherent in the said act itself. In my view, the circumstances prima facie do indicate an attempt to usurp the reputation and good will attached to the word "THAYAR" which is the Trade Mark of the Plaintiff and I hold that the said action of the defendants amount to passing off the Defendants' business or trade as that of the Plaintiff's business or trade. Therefore, the Plaintiff is perfectly justified in resisting the attempts of the Defendants in passing off their goods as that of the Plaintiff and the Defendants shall not be permitted to mislead or misguide the public from believing that the source of their products is the source of the Plaintiff. Therefore, notwithstanding the fact that the Defendants have obtained registration of the Trade Mark "THAAYAR" in respect of their products, they have to be restrained from passing off their goods as that of the Plaintiff. Accordingly, the issues (b), (c) and (e) in CS.No.196/2007 and the issues (b) and (d) in CS.No.300/2007 are answered in favour of the Plaintiff in CS.No.196/2007.
60. In the result,
(1) The suit in CS.No.196/2007 is decreed, except the prayer relating to infringement, on the following terms:-

(a) The Defendants are restrained by a permanent injunction from in any manner passing off their products as that of the Plaintiff by using the offending Trade Mark ''THAAYAR'' or any other Trade Mark which is identical or similar or deceptively similar to that of the plaintiff's reputed Trade Mark ''THAYAR''.

(b) The Defendants are also directed to render true and faithful accounts of all the profits earned by them through service and sale of the offending marks and pay the amount found due on such taking of accounts to the Plaintiff.

(c) The Defendants are also directed to surrender to the Plaintiff all the impugned products produced and manufactured by the Defendants, containing the same name of the offending marks, with all documents pertaining thereto.

(2) The suit in CS.No.300/2007 is dismissed, except the prayer relating to infringement.

(3) In respect of the prayer relating to infringement prayed by both the parties in both the suits, it is left open to both the parties to work out their remedy before appropriate forum. However, in the circumstances of the case, there will be no order as to costs.

15.09.2014
Index:Yes/No
Web:Yes/No
Srcm

ARUNA JAGADEESAN, J.

Srcm Pre-Delivery Judgement in CS.Nos.196/2007 & 300/2007 15.09.2014 CS.Nos.196/2007 & 300/2007 ARUNA JAGADEESAN, J.

After the pronouncement of the judgement today, the learned counsel for the Defendants in CS.No.196/2007 would submit that the judgement may be suspended for a period of four weeks, as he is intending to file an appeal. The learned counsel for the Plaintiff undertakes not to proceed further pursuant to the judgement passed by this court till then and the said undertaking is recorded. The judgement is suspended for a period of four weeks from today. The Registry is directed to draft decree in both suits and issue certified copy within a week from today.

15.09.2014 Srcm

Unlock Advanced Research with PRISMAI

Madras High Court