Delhi High Court
Havells India Limited vs The Advertising Standards Council Of ... on 3 February, 2016
Author: Vipin Sanghi
Bench: Vipin Sanghi
$~49.
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ Date of Decision: 03.02.2016
% CS(OS) 3187/2015 and I.A. Nos.22366-22368/2015
HAVELLS INDIA LIMITED ..... Plaintiff
Through: Mr. Chander M. Lall, Ms. Nancy
Roy, Mr. Karan Bajaj & Ms. Nupur
Lamba, Advocates.
versus
THE ADVERTISING STANDARDS
COUNCIL OF INDIA ..... Defendant
Through: Ms. Avni Singh, Advocate.
CORAM:
HON'BLE MR. JUSTICE VIPIN SANGHI
VIPIN SANGHI, J. (OPEN COURT)
1. Learned counsel for the parties were heard at some length on the
aspect whether the present suit relates to a commercial dispute within the
meaning of Section 2(1)(c) of the Commercial Courts, Commercial Division
and Commercial Appellate Division of High Courts Act, 2015 (Commercial
Courts Act). After the hearing, the counsels were verbally informed that the
submission of Mr. Lall - that the disputes arising in the present suit are
commercial disputes, has been rejected and, accordingly, a short order
adjourning the proceedings was recorded. Counsels were informed that a
detailed order would follow. It has, thus, become necessary to record
CS(OS) 3187/2015 Page 1 of 14
reasons and pass this order. As noticed above, it is contended by the learned
counsel for the petitioner Mr. Chander M. Lall that the dispute arising in the
present suit is a commercial dispute, whereas learned counsel for the
defendant has opposed the said submission. Depending on the
determination whether the dispute raised in the present suit is commercial,
or not, would depend the decision whether to transfer the suit to the Court of
the concerned District Judge having jurisdiction over the matter, or to retain
the suit in this Court as a commercial cause, since the jurisdictional
valuation is below Rs. 1 Crore.
2. The suit filed by the plaintiff is directed against the Advertising
Standards Council of India (ASCI). The plaintiff company states that it is
engaged in the business of manufacture and supply of Fast Moving
Electrical Goods (FMEG). It is engaged, inter alia, in the production of
electrical cables and wires. In respect of wires & cables, the plaintiff has
adopted/ used the tagline "Wires that don't catch fire". It has been running
an advertising campaign for its wires & cable products using the said
tagline. The plaintiff states in paragraph 2 of the plaint that the suit relates
to the illegal direction dated September 15, 2015 issued by the defendant,
directing the plaintiff to withdraw or appropriately modify an advertisement
of the plaintiff's advertisement campaign featuring its distinctive tagline
and trade mark "Wires that don't catch fire", which tagline has be
uninterruptedly and continuously used since the year 2007, inter alia, in
numerous advertising campaigns issued on national scale on national
television channels by the plaintiff, and which is the back bone of the
plaintiff's promotion of its fire retardant wire & cable products.
CS(OS) 3187/2015 Page 2 of 14
3. A perusal of paragraph 3 of the plaint shows that the grievance of the
plaintiff is that the defendant has issued the impugned directions without
following the due process of law, including non-compliance of the principles
of natural justice.
4. In paragraph 4 of the plaint, the plaintiff states that the defendant has
passed a cryptic and non-speaking order dated 16.09.2015 without
application of mind and the same does not have sanction of law. The
plaintiff's tag line "Wires that don't catch fire" was considered to be
misleading by exaggeration, and the plaintiff has been asked to
modify/withdraw its T.V. Commercial. The communication for modification
/ withdrawal has been simultaneously sent and forwarded to third parties for
compliance.
5. The plaintiff claims in paragraph 5 of the plaint that the impugned
order restricts it from exercising, inter alia, its intellectual property right in
the tagline created by using rhyming words - as an expression of creativity,
which has attained goodwill and reputation by virtue of its long and
continuous use. The plaintiff states that creation and use of such tag lines is
a well-established and universally accepted practice, as a tool for marketing.
Advertising helps customers to know about the benefits they can expect
while choosing a product or service. It establishes a company's brand. The
purpose and intent of using a tagline is to connect the brand of a particular
manufacturer, and to create a recall value. The tagline creates intellectual
rights of commercial value and importance for the manufacturer,
contributing to its brand equity. The plaintiff states that the tagline in
question has been able to achieve for the plaintiff, the status of a well-known
CS(OS) 3187/2015 Page 3 of 14
trade mark in respect of "HAVELLS". The plaintiff states that the slogans
used by it are coined specifically keeping in mind the attributes of its
products for which they are used, besides having a creative element that they
catch the tongue of the audience who uses them as "lite motif".
6. The plaintiff states that it is not a member of the defendant/ ASCI. It
states that the conduct of the defendant has been adversely commented upon
by the Bombay High Court in several decisions such as Teleshopping Vs.
The Advertising Standards Council of India, Suit (L) No.492/2015 in its
judgment/ order dated 08.05.2015, and in Century Ply Boards (India) Ltd.
Vs. The Advertising Standards Council of India, 2000 (1) Bom.CR 136.
The plaintiff states that the defendant has issued the impugned direction
dated 15.09.2015 arbitrarily, unjustly and without complying with the
principles of natural justice.
7. The plaintiff states that in the year 2007, it launched the advertising
campaign using the tagline "Wires that don't catch fire" for promoting its
fire retardant wires & cable products. The plaintiff claims that it enjoys
intellectual property rights in the said tagline. The plaintiff claims
copyright/ trademark in the slogan/ tagline "Wires that don't catch fire";
goodwill and common law rights in the advertising campaign with the said
tagline; copyright in the advertising script and; common law trade mark
rights in the tagline "Wires that don't catch fire". The said tagline has
acquired trade mark significance inasmuch, as, it is exclusively associated
with the plaintiff. The tagline in question creates an instant brand connect
with the plaintiff's products.
CS(OS) 3187/2015 Page 4 of 14
8. The grievance against the defendant narrated in the suit is that the
defendant has passed the order dated 16.09.2015, thereby directing the
plaintiff to either modify its television commercial - which shows a lunch
box suspended with the support of "HAVELLS" wire above the fire to heat
the food and the advertisement goes "Wires that don't catch fire", or to
withdraw the same prior to 05.10.2015. The grievance is that the said order
has been passed without an opportunity of hearing to the plaintiff and a
review is provided on the condition that the plaintiff first complies with the
order. The order dated 16.09.2015 is said to be non-speaking and cryptic by
claiming that the tagline "Wires that don't catch fire" is misleading by
exaggeration with regard to the properties and characteristics of the
plaintiff's product. The plaintiff states that the cause of action accrued in
favour of the plaintiff on 16.09.2015 when the plaintiff received the
impugned decision of the defendant, as aforesaid. The reliefs sought in the
suit are the following:
a. A decree of declaration that the mark /expression "Wires that Don't
Catch Fire" of the plaintiff is a well-known mark;
b. This Hon'ble Court declare that the advertisement campaign of the
plaintiff is fair and truthful and does not constitute a violation of any
advertising laws or code and the plaintiff is entitled to broadcast the
advertisement throughout the country;
c. A decree of permanent injunction be passed against the defendant
thereby staying the impugned order dated 16.09.2015 passed by the
defendant against the advertisement of the plaintiff.
CS(OS) 3187/2015 Page 5 of 14
d. A decree of permanent injunction directing the defendant to remove
the impugned order dated 16.9.2015 from its website;
e. A decree of permanent injunction directing the defendant to issue a
clarificatory letter to the Department of Consumer Affairs, Mr. Rohit
Gupta, Multi Screen Media P. Ltd. and Mr. Vikas Mehta, Lintas India
or any other person or entity whom the defendant may have
communicated the order dated 16.09.2015 stating that the
communication is neither an order or a direction and is not binding
upon them but is an advise/ opinion of a self-regulatory body.
f. The defendant be restrained by a permanent injunction from creating
impediments in the broadcast of the advertisement campaign of the
plaintiff "Wires that Don't Catch Fire" including writing to the
agencies of the plaintiff and/or Government authorities;
g. Pass an order of permanent injunction against the defendant thereby
restraining the defendant from publicizing or informing any third
party the directions contained in their email and from creating any
other impediments
h. Pass an order of permanent injunction against the defendant thereby
restraining the defendant from entertaining or adjudicating upon any
complaint(s) against the advertisement of the plaintiff which is the
subject matter of the present proceedings;
9. Mr. Lall, learned counsel for the plaintiff has submitted that Section
2(z)(g) defines what constitutes a "well-known trade mark". He submits
that the expression mark of expression "Wires that don't catch fire" of the
plaintiff is a well-known trade mark as it is used in relation to the plaintiff's
CS(OS) 3187/2015 Page 6 of 14
goods, namely wires & cables and it has become well-known to the
substantial segment of the public which uses wires & cables, and on account
of the said usage of the said tagline goods of others would likely to be taken
as indicating a connection in the course of trade with the goods of the
plaintiff. He refers to Section 11 (5) to submits that registration of a trade
mark cannot be refused on the ground specified in sub-sections (2) and (3)
of Section 11 unless opposition is raised by the proprietor of an earlier trade
mark. He submits that no such objection has been raised to the use of the
mark/ tagline in question by the plaintiff. He submits that the plaintiff
satisfies the conditions for qualification of its trade mark in the said tagline
as a well-known trade mark. In support of his plea that documents are
capable of trade mark protection, he places reliance on a Division Bench
judgment of this Court in Procter & Gamble Manufacturing (Tianjin)
Company Limited Vs. Anchor Health and Beauty Care Private Limited,
FAO(OS) No.241/2014 decided on 30.05.2014 in 2014 : Indlaw Del 1931,
wherein a Division Bench of this Court protected the use of the tagline
"ALLROUND PROTECTION" in relation to tooth paste.
10. He has also relied on the order passed by a learned Single Judge of
this Court in Skol Breweries Vs. Unisafe Technologies, 2010 (173) DLT
453, wherein the Court protected the plaintiff's brand "knock out" for beer.
In neither of these cases, the Courts found the trade mark of the concerned
party to be misleading or misdescriptive. Mr. Lall has also placed reliance
on Tata Press Ltd. Vs. Mahanagar Telephone Nigam Limited & Others,
(1995) 5 SCC 139, to submit that the right to freedom of speech &
expression extends to commercial speech, and the same could not be
CS(OS) 3187/2015 Page 7 of 14
interfered with - except by the State, only if the same is false, deceptive or
misleading. He submits that the defendant not being an instrumentality of
the State, has no authority to issue the impugned directions and compel the
plaintiff to withdraw its advertising campaign with the tagline "Wires that
don't catch fire" in relation to its cables & wires.
11. He submits that in its commercial/ cinematograph film, the plaintiff
enjoys copyright which is protected under Section 14(d)(iii), i.e. the right to
communicate the cinematograph film to the public. He has also taken the
Court through the ASCI Regulations, which lay down the several steps that
ASCI takes in case of non-adherence of its directions. He submits that the
said steps taken by the defendant/ ASCI would eventually cause disruption
of the advertising campaign of the plaintiff using the tagline "Wires that
don't catch fire". He has also referred to the 78th Report on the Commercial
Courts, Commercial Division and Commercial Appellate Division of High
Courts Bill, 2015, to submit that the definition of the "commercial dispute"
under clause 2(c) of the Act should be given an expansive meaning to
include all commercial disputes, even though they may not strictly fall
within the definition of the said term used in the Commercial Courts Act.
Mr. Lall submits that since the disputes between the parties arise out of
intellectual property right related to registered and unregistered trade mark
and copyright, the same is a "commercial dispute" within the meaning of
Section 2(c) of the Act.
12. He has also referred to Section 34 of the Specific Relief Act to submit
that since the plaintiff is entitled to a legal character as the owner of the
intellectual property in the tagline in question, the plaintiff is entitled to
CS(OS) 3187/2015 Page 8 of 14
institute the suit against the defendant, as the defendant is denying and
interested in denying the plaintiff's intellectual property in the said tagline.
He has also placed reliance on Section 38 (3) of the Specific Relief Act to
submit that the plaintiff is entitled to maintain a suit to seek perpetual
injunction as the defendant has threatened to invade the plaintiff's right to
enjoy its intellectual property in its trademark as contained in the tagline
"Wires that don't catch fire".
13. On the other hand, the submission of learned counsel for the
defendant is that the defendant is not at all concerned as to whether, or not,
the plaintiff has any intellectual property in the tagline in question. The
concern of the defendant is only with regard to adoption of misleading
advertisement campaign by the plaintiff in relation to its wires & cables,
wherein the plaintiff is using the tagline "Wires that don't catch fire".
Learned counsel submits that the claim with regard to the plaintiff's wires &
cables that they are "Wires that don't catch fire" is misleading by
exaggeration. The said products of the plaintiff are made of fire retardant
material, but the wires will burn when put in flames and to continue to burn
as long as the flame is maintained by other combustible materials.
According to the defendant, there is a difference between the use of the
expression "do not burn" and "are fire retardant" and "do not aid in
continuation of fire". Learned counsel submits that it is issuance of the
direction dated 16.09.2015 which has given cause of action to the plaintiff.
The plaintiff has introduced the first relief of declaration of its mark as a
well-known trade mark only with a view to give the present suit the colour
of being an intellectual property dispute. Since the defendant has no
CS(OS) 3187/2015 Page 9 of 14
concern with the plaintiff's claim for intellectual property/ trademark in the
tagline "Wires that don't catch fire", the plaintiff is seeking to obtain the
declaratory decree - that the said trade mark is a well-known trade mark,
without any serious or meaningful opposition as the defendant has no
concern with the said aspect. Learned counsel submits that the issue is not
whether the plaintiff has proprietary rights in the said tagline, or not, as even
if it were to have proprietary rights protected as trade mark/ copyright, the
impugned order of the defendant would stand on merits and the defendant
cannot claim to have a right to continue to use the said tagline as a trade
mark, or copyright, as it is a deceptive as to the nature of the product for
which it is used.
14. Learned counsel submits that the protection enjoyed by the plaintiff in
respect of the tagline under the Trademarks Act would not afford any
protection to the plaintiff against breach of advertising laws. She submits
that the ASCI Code is statutory. In this regard, she placed reliance on Rule
7(9) of the Cable Television Networks Rules, 1994. The same reads:
"(9) No advertisement which violates the Code for self
regulation in advertising, as adopted by the Advertising
Standards Council of India (ASCI), Mumbai for public
exhibition in India, from time to time, shall be carried in the
cable service."
15. Section 2(1)(c) of the Commercial Courts Act defines the expression
"commercial dispute" to mean "dispute arising out of ... ... ...". Therefore,
for a dispute to be a "commercial dispute", it is essential first & foremost
that there has to be a "dispute". Unless the plaint discloses a "dispute", the
mere fact that the plaintiff may have sought the relief which may relate to a
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subject matter enlisted as clauses (i) to (xxii) of Section 2(1)(c) of the
Commercial Courts Act, would not render the "dispute" arising in the suit as
a "commercial dispute".
16. In the present case, as noticed hereinabove, the dispute raised by the
plaintiff is in relation to the impugned communication/ direction dated
15.09.2015 issued by the defendant/ ASCI on the premise that the
advertisement of the defendant using the tagline "Wires that don't catch
fire" is misleading and exaggerated. The defendant has not sought to raise
any challenge to the claim of trade mark or copyright laid by the plaintiff
either in "HAVELLS" or in the tagline in question. Thus, no cause of action
has arisen in favour of the plaintiff to assert its claim for a declaration that
its mark/ expression "Wires that don't catch fire" is a well-known trade
mark. As rightly argued by learned counsel for the defendant, since the
defendant has not questioned the plaintiff's claim for a trade mark in the said
tagline, the plaintiff cannot seek the said relief in the present suit, as the
assertion of the said right would not have any real opposition. It would
eventually tantamount to grant of an ex-parte decree if the said declaration is
made in the present suit, as is sought in relief (a) of the plaint.
17. On repeated query by the Court, Mr. Lall candidly admitted that
merely because a party may have a registered trade mark, which may even
be claimed to be a well-known trade mark in a tagline, the same cannot be
used in relation to the goods for which it is obtained and got registered for
its mis-description of the said goods. Mr. Lall has himself drawn the
attention of the Court in this regard to Section 9(2)(a) of the Trade Marks
Act which provides that a mark shall not be registered as a trade mark if - it
CS(OS) 3187/2015 Page 11 of 14
is of such a nature as to deceive the public or cause confusion. Thus, the
repeated and wholesale assertions made by the plaintiff in the plaint with
regard to its continuous usage of the tagline "Wires that don't catch fire"
over the years in its commercials, etc. and the fact that the said tagline has a
recall value for its products, namely cables & wires, is of no relevance as the
only dispute raised by the defendant is with regard to the said claim -
contained in the tagline, that the same is deceptive and misleading by
exaggeration.
18. Reliance placed by Mr. Lall on Teleshopping (supra), Century Ply
Boards (supra) and the pleas with regard to non-compliance of principles of
natural justice, etc. have no relevance to determine as to whether the present
suit relates to a commercial dispute. These decisions would be relevant
while dealing with the plaintiff's grievance on its merits. Similarly, Procter
& Gamble (supra) and Skol Breweries (supra) also have no relevance for the
reason that no dispute has been raised by the defendant - which forms the
basis for the cause of action, to deny the plaintiff's claim for trade mark or
copyright in the tagline "Wires that don't catch fire".
19. Section 34 of the Specific Relief Act relied upon by Mr. Lall also
cannot come to the aid of Mr. Lall for the reason that the defendant has not
denied, and is not interested in denying the plaintiff's claim for intellectual
property in the tagline in question. Similarly, the defendant has not
threatened the plaintiff with invasion of its right in its intellectual property
claimed in the tagline in question.
20. On a plain and meaningful reading of the plaint, it appears that the
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plaintiff is seeking to masquerade the present as a suit relating to intellectual
property dispute, whereas the same is simply a suit challenging the action of
the defendant in issuing the impugned order/ communication/ direction
dated 16.09.2015, the scope of which only lies in the realm of advertising
and has no concern with any intellectual property right claimed by the
plaintiff. In fact, if the first relief prayed for in the suit is excluded, all the
other reliefs sought in the suit by the plaintiff stem from the impugned order
dated 16.09.2015 passed by the defendant.
21. The submission of Mr. Lall that this Court should construe the
expression "commercial dispute" widely to include all commercial disputes,
even if they do not strictly fall within clauses (i) to (xxii) of Section 2(1)(c),
cannot be accepted for the reason that the Parliament has consciously given
the precise definition as to what a commercial dispute "means". It is not an
inclusive definition and the specific matters which qualify as relating to
"commercial disputes" have been specifically set out in clauses (i) to (xxii)
aforesaid.
22. For all the aforesaid reasons, I am of the view that the present suit
does not raise a "commercial dispute" within the meaning of Section 2(1)(c)
of the Commercial Courts Act and since the jurisdictional value of the suit is
below Rs. 2 Crores, the same is liable to be transferred to the Court of the
competent District Judge in view of the notification No.2718/DHC/Orgl.
dated 25.11.2015, issued under Section 4 of the Delhi High Court
(Amendment) Act, 2015 (Act 23 of 2015).
23. At this stage, learned counsel for the petitioner submitted that the
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plaintiff shall be moving an application to amend the plaint so as to raise the
jurisdictional value of the suit.
24. At request of learned counsel for the plaintiff, adjourned to
22.03.2016.
VIPIN SANGHI, J.
FEBRUARY 03, 2016 B.S. Rohella CS(OS) 3187/2015 Page 14 of 14