Delhi District Court
Rc Plasto Tanks & Pipes Pvt. Ltd vs Pankaj Kumar Patel on 2 May, 2023
IN THE COURT OF MS SAVITA RAO, DISTRICT JUDGE
COMMERCIAL COURT-04, SHAHDARA,
KARKARDOOMA COURTS, DELHI
CNR No. DLSH01-006038-2021
CS (Comm) No. : 275/2021
In the matter of :-
RC Plasto Tanks & Pipes Pvt. Ltd.
Plot no. D/2-A, MIDC Hingna Road
Nagpur, Maharashtra- 440028
............Plaintiff
Vs.
Pankaj Kumar Patel
Trading as: Dhoramnath Industries
At : Behind 02 Mall, Ring Road no. 2,
Near Reliance Petrol Pump
Gondwara, Raipur, (C.G.)
.........Defendant
Date of institution of the case : 30.07.2021
Date of final arguments : 31.03.2023, 15.04.2023,
28.04.2023 and 29.04.2023
Date of judgment : 02.05.2023
JUDGMENT
1. This is suit u/s 134 & 135 of Trademarks Act and Section 55 of Copyright Act for Permanent Injunction Restraining Infringement, Passing Off and Delivery up, Rendition of Accounts etc. filed by plaintiff against the defendant.
CS (Comm) No. 275 of 2021 1/262. Plaintiff, as stated, is engaged in manufacturing, supplying and exporting extensive range of water storage tanks, PVC Pipes and fittings, C-PVC pipes and fittings, agricultural pipes and fittings, HDPE pipes, casing pipes solvent cement and other allied and cognate goods under the trademark PLASTO/PLASTO LABEL in respect of said goods since 1981 through its predecessor. Since then, the same is an inherently distinctive trademark and plaintiff is the owner and proprietor of the same.
3. As further stated, PLASTO is the original art work within the meaning of Copyright Act 1957 and registered under Copyright Act and the plaintiff is the owner thereof. The plaintiff has successfully obtained various copyright certificates in respect of various labels for the trademark/label PLASTO . Plaintiff is carrying on its affairs and promotion of its goods and services and sales of its products through various websites with various domain names which all have its corporate name i.e. PLASTO as its essential feature. The word PLASTO is especially coined and unique word having distinctive design, lettering style, logo, font, colour scheme and has attained exclusive identity of the plaintiff . With the advent of e-commerce and increasing popularity of internet and ditigalization, plaintiff adopted the domain names comprising its trademark as its essential feature i.e. www.plasto.in and www.rcplasto.in in the year 2009 and 2016 respectively. The said goods are manufactured in India and sold, marketed, distributed and exported across a number of countries. Plaintiff company also displays, advertises, solicits and sells its products under the said trademark/label on various major e-commerce interactive website i.e. www.flipkart.com, www.amazon.com, www.indiamart.com, www.tradeindia.com etc. and also through its CS (Comm) No. 275 of 2021 2/26 interactive website www.plasto.in and www.replasto.in on internet. The said products of plaintiff are accessible across India and globe.
4. As further stated, defendant is also engaged in the same business as that of plaintiff i.e. manufacturing, marketing and selling of water storage tanks and other allied and cognate goods . Defendant with malafide intention and to pass on its goods as those of the plaintiff, deliberately adopted the trademark/label/name SHRI PLOSTO which is identical and/or similar to plaintiff's trademark/label/tradename PLASTO/PLASTO label in each and every respect including phonetically, visually, structurally in its basic idea and in its essential features in respect of the impugned goods and business. Defendant is not the proprietor of the impugned label and has adopted and also using the same as a trademark/label in relation to its impugned good and business in the course of trade without the leave and license of the plaintiff. Defendant has no right to use it in any manner in relation to the impugned goods and business or for any other specification of goods business whatsoever being in violation of plaintiff's right therein.
5. Because of the impugned activities of defendant, confusion and deception is being ensued/likely to be ensued in the market. In the first week of June 2018, plaintiff came to know about the trademark application for trademark/label Shri PLOSTO of the defendant, as registered through randomly online search of trademark registry. Trademark application was filed by the defendant on the basis of ' proposed to be used on all India basis' . Plaintiff immediately took steps to file the rectification/cancellation of defendant's impugned trademark registration under impugned trademark. On 07.06.2018, plaintiff filed rectification/cancellation CS (Comm) No. 275 of 2021 3/26 petition before Ld. Registrar of Trademarks, Mumbai. Thereafter, plaintiff investigated the products of defendant in the market but did not find any impugned product of the defendant under the impugned trademark. It is only in second week of July 2021 that the plaintiff for the first time came across the impugned goods of the defendant under the impugned trademark/label SHRI PLOSTO in market of Shahdara District, Delhi. As further stated, due to impugned activities of defendant, plaintiff is suffering tremendously in business and in goodwill and the proprietary rights of the plaintiff are being reduced to nullity and being violated. The innocent purchasers are being deceived and irreparable loss and serious mischief is being caused to the plaintiff and also to the consuming public at large. Hence, instant suit was filed alongwith application under order 39 rules 1 & 2 CPC r/w section 151 CPC.
6. Photographs of goods of plaintiff with trademark PLASTO/PLASTO label and that of impugned goods i.e water tanks with trademark SHRI PLOSTO of defendant were filed on record. Plaintiff also filed copy of its various trademarks in different classes including Class 20 as well as details of various trademarks of plaintiff in tabular form was given in the plaint. Copy of legal proceedings certificates including Legal Proceeding Certificate in Class 20 of trademark PLASTO was also filed including the copy of rectification/cancellation application filed by plaintiff company for removing the trademark registration of defendant alongwith the status report dated 26.07.2021 in respect of application of defendant and copy of counter statement filed by defendant before the Trademark Registry, New Delhi.
CS (Comm) No. 275 of 2021 4/267. After filing of the suit, vide order dated 10.08.2021, ex- parte ad-interim injunction was granted in favour of plaintiff and against the defendant.
8. In written statement filed on behalf of defendant, it was submitted that the present suit is not maintainable as under the Trademarks Act, a generic, descriptive and common English word cannot be infringed as the same is not registrable in the first place. The word PLASTO is a common and generic word found in Webster's Third New International Dictionary of the English Language and essentially means or suggests a plastic or a moulded use of plastic formulation. Accordingly, not only is the plaintiff's trademark PLASTO a common word, it is also suggestive of the goods produced and manufactured by the plaintiff in clear violation of section 9 of Trademarks Act. Rather the impugned trademark of defendant SHRI PLOSTO comprises of the auspicious word 'Shri' followed by the work ' PLOSTO' which is unique term.
9. It was further stated that the impugned trademark i.e. SHRI PLOSTO is duly registered in the name of defendant since 2017 and accordingly, there is no confusion with respect to ownership of impugned trademark. Moreover, the impugned trademark had been registered by the Trademark Registry as the same is completely distinct from the plaintiff's trademark PLASTO in all respects be it phonetically, visually, structurally, colour combination etc. A bare comparison of the impugned trademark (label) SHRI PLOSTO with that of the plaintiff i.e. PLASTO would show that there is prima facie no attempt to deceive the unwary customer by the defendant that the goods sold by it originated from the plaintiff, besides the fact that CS (Comm) No. 275 of 2021 5/26 plaintiff's mark being a descriptive mark, plaintiff cannot monopolize upon its usage. Hence, there is no question of bringing in tort of 'passing off' in the present matter.
10. It was further stated that admittedly after being aware of the existence and registration of the impugned trademark since 2018, plaintiff took no steps to injunct the defendant from using the impugned trademark which shows that the claims of plaintiff regarding suffering of losses etc. are baseless, motivated by malice and filed with sole intent to harass the defendant who is a strong competitor of plaintiff and is well known amongst masses for its quality products. Goods manufactured by the defendant are ISO certified and defendant is well known for maintaining high standards and manufacturing quality goods and has created immense goodwill for itself in the open mark and amongst consumers. Operation of defendant is restricted to the State of Chhattisgarh only and names of alleged dealers mentioned in the amended plaint subsequently is a clear afterthought as the defendant has at no point of time dealt with any such dealers in Shahdara. As further submitted, no question of infringement of trademark of plaintiff by the defendant arises and plaintiff under the garb of alleged infringement, malafidely filed the present suit against the defendant to cut competition.
11. In replication filed, contents of written statement were denied and those of plaint were reiterated and reaffirmed.
12. Matter was fixed up for arguments on applications under order 39 Rule 1 & 2 CPC and application under order 39 Rule 4 CPC. However, during the course of arguments on these applications, it was submitted by counsel for defendant that the business of defendant is being closed. He is not continuing with CS (Comm) No. 275 of 2021 6/26 the business of manufacturing and sale of water tanks and is also not using and shall not use the impugned trademark/label SHRI PLOSTO/label in future. Statement of counsel for defendant was recorded separately to this effect on 19.12.2022. Application under order 39 Rule 1 & 2 CPC also stood disposed off in terms of statement of counsel for defendant and the suit was proceeded further only qua the remaining claim.
13. Vide order dated 19.12.2022, issues were framed and were reframed vide order dated 23.02.2023, as follows:
1. Whether the plaintiff is entitled to damages and loss of profit/rendition of account on the profits earned by the defendant alongwith cost of the suit, if so, quantum of the same? OPP.
2. Relief
14. In plaintiff's evidence, Sh. Mukesh Kumar Gaidhane, AR of plaintiff was examined as PW1 who filed his evidence by way of affidavit Ex. PW1/A and relied upon report of Local Commissioner alongwith annexures as Ex. PW1/1.
15. In defendant's evidence, no witness was examined and DE was closed by defendant vide statement dated 01.02.2023. Issue wise findings are as under :-
Issue no.1:
16. Trademark 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 the shape of goods, their packaging and combination of colours.
17. In terms of section 29 of Trademarks Act, (1) A registered trademark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the CS (Comm) No. 275 of 2021 7/26 course of trade, a mark which is identical with, or deceptively similar to, the trademark in relation to goods or services in respect of which the trademark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark.
(2) A registered trademark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which because of-
(a) its identity with the registered trademark and the similarity of the goods or services covered by such registered trade mark ; or
(b) its similarity to the registered trade mark and the identity or similarity of the goods or services covered by such registered trade mark; or
(c) its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark (3) In any case falling under clause (c) of sub-section (2), the court shall presume it is likely to cause confusion on the part of the public.
18. Thus, an action for infringement of trademark or more of passing off will lie wherever the defendant's product's name, or its intended name, is calculated to deceive, and so to divert business from the plaintiff, or to occasion a confusion between the two businesses. Honesty and fair play are, and ought to be, CS (Comm) No. 275 of 2021 8/26 the basic policies in the world of business . When a person adopts or intends to adopt a name in connection with his business or services which already belongs to someone else, it results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury (Laxmikant V. Patel Vs. Chetanbhai Shah and Anothers (2002) Supreme Court Cases 65)
19. As was observed in Kavi Raj Pandit Durga Dutt Sharma vs. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980 and in National Bell Co. v. Metal Goods Mfg. Co., AIR 1971 SC 898:
" On registration of a trade mark, the registered proprietor gets, under Section 28, the exclusive right to the use of such trade marks in relation to the goods in respect of which the trade mark is registered and to obtain relief in respect of any infringement of such trade mark. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive right to the use of the trade mark in relation to those goods" .
20. As was observed in American Home Products vs. Mac Laboratories, AIR 1986 SC 137 :
" when a person gets his trade mark registered, he acquires valuable rights by reason of such registration. The registration of the trade mark gives the goods in respect of which it is registered and if there is any invasion of this right by any other persons using a mark which is the same or deceptively similar to the trade mark, one can protect the trade mark by an action for infringement in which an injunction can be obtained".
21. Counsel for plaintiff made following submissions:
(a) That, by taking the plea of registered proprietor of an impugned trademark, defendant cannot say that there exists no infringement of trademark and ' passing off ' the goods of the plaintiff. Reliance was placed upon Dhani Aggarwal Vs. Mahesh Yadav & Ors. 2023 (93) PTC 575 (Del) 41 wherein it was observed that:CS (Comm) No. 275 of 2021 9/26
" 41. In S. Syad Mohi Deen, which has been relied upon by the Learned Senior Counsel for the respondents, it has been held that the rights of prior user are superior to that of registration and are unaffected by the registration rights under the Act. Registration merely recognises the rights which are pre-existing in common law and does not create any rights and in case of conflict between the two registered proprietors, the evaluation of the better rights in common law is essential as the common law rights would enable the court to determine whose rights between the two registered proprietors are better and superior in common law which have been recognized in the form of the registration by the Act. Applying the said principle, the appellant being the prior adopter of the mark certainly has a superior right over the respondents in the said mark and is entitled to protection of the same notwithstanding the registration obtained by the respondents".
(b) That, in terms of statement dated 19.12.2022, defendant had given the statement for non-user of the impugned trademark and further accepted to suffer the decree in terms of the permanent injunction for ascertaining Damages and Rendition of Account, defendant neither provided their books of accounts or profit earned nor led their evidence.
(c) That, from the report of Local Commissioner, it is clear that the stickers of impugned trademark were found in more than 3500 quantity. Moreover, 11 water tanks which were sold in a single day by the defendant, as already mentioned in the defendant's objection to LC report, cannot be bypassed to show the quantum of usage of the impugned trademark by the defendant.
(d) That, defendant by selling and soliciting the goods bearing the impugned trademark tried to ride upon the well established goodwill of the plaintiff, which they have already exploited by producing and selling the impugned goods in the markets and later on by just giving the statement to not to use it CS (Comm) No. 275 of 2021 10/26 in future, does not suffice the purpose as the profits have already been earned by the defendant by using the deceptively similar mark as that of the plaintiff.
(e) Reliance was placed by Ld. counsel for plaintiff upon following authorities:
(i) LT Foods Limited Vs. Saraswati Trading Company, 2022/DHC/004806:
" 16. Coming to the relief of costs and damages which have been prayed for by the plaintiff, the defendant's counterfeiting is completely contrary to law and is also diluting the reputation and goodwill of the plaintiff's marks. There can be no justification for manufacturing and selling rice in counterfeit " DAAWAT" branded packaging. Clearly, customers are being misled by the defendant and the entire effort is deliberate and dishonest".
(ii) Proctor & Gamble Company Vs. Joy Creators 2011 (450) PTC 541 Del
(iii) Laxmikant V. Patel Vs. Chetanbhai Shah and Anothers (2002) Supreme Court Cases 65 :
" A person may sell his goods or deliver his services 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. A competitor initiating sale of goods or services in the sane name or by imitating that name results in injury to the business of one who has the property in that name. The law does not permit any one to carry on his business in such a way as would persuade the customers or clients in buying that the goods and services belonging to someone else are his or are associated therewith. It does not matter whether the latter person does so fraudulently or otherwise. The reasons are two. Firstly, honesty and fair place 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 someone else it results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury. This form of injury has also been termed as tort of " injurious falsehood".
(iv) Cadila HealthCare Limited Vs. Uniza Healthcare LLP & Anr. CS (Comm) No. 415/2020 CS (Comm) No. 275 of 2021 11/26
(v) Hero Honda Motors Limited Vs. Rafiq Memon MANU/DE/1086/2012:
" 8. This court has no hesitation in saying that the time has come when the courts dealing actions for infringement of trademarks, copy rights, patents, etc. should not only grant compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them".
(vi) Louis Vuitton Malletier Vs. Iqbal Singh & Ors. MANU/DE/1136/2019
(vii) Sandisk LLC & Anr. Vs. Laxmi Mobiles & Ors. CS (Comm) no. 598/2019 (2023/DHC/000430)
(viii) Century Traders Vs. Roshan Lal Duggar Co., MANU/DE/0153/1977:
" 14. The law is pretty well settled that in order to succeed at this stage the appellant had to establish user of the trademark prior in point of time than the impugned user by the respondents. The registration of the said mark or similar mark prior in point of time to user by the appellant is irrelevant in an action of passing off and the mere presence of the mark in the register maintained by the trademark registry did not prove its user by the persons in whose names the mark was registered and was irrelevant for the purposes of deciding the application for interim injunction unless evidence had been led or was available of user of the registered trade marks".
(ix) Dabur India Ltd. Vs. Alka Ayurvedic Pvt. Ltd. 2017 SCC Online Del 7268 :
" 14. the contention of counsel for defendant, of section 28 (3) prohibiting a suit for infringement of the mark of the defendant is also registered, does not flow from section 28. Section 28 (1) of the Trade Marks Act, " subject to the other provisions of the Act" vests in the registered proprietor of the trademark, " if the registration thereof is valid" , the exclusive right to sue the trade mark in any manner provided by the Act. Thus, the vesting of the exclusive right in the registered proprietor is subject to the other provisions of the Act and to the registration thereof being valid. It follows that if there is any other provision of the Act not vesting such an exclusive right in the registered proprietor or if the registration is invalid, such exclusive right would not vest in the registered proprietor of the mark".CS (Comm) No. 275 of 2021 12/26
(x) Capital Meters Ltd. Vs. B.P. Electric,
MANU/DE/1369/2001
(xi) Midas Hygiene Industries P Ltd. & Ors. Vs. Sudhir Bhatia and Ors. MANU/SC/0186/2004.
22. On behalf of defendant, following submissions were made:
(a) That, the word ' Shri PLOSTO' in all aspects, be it phonetically, visually, structurally, colour combination etc. is distinct from the plaintiff's trademark 'Plasto'. Admittedly, plaintiff was aware of the impugned registered trademark by the defendant since first week of June 2018, however, filed the rectification application before Trademark Registry vide dated 07.06.2018 and subsequently filed the present suit in July 2021 i.e. after more than three years of knowledge while the rectification application was pending before the Trademark Registry and the said rectification application is still pending before the Trademark Registry.
(b) That, the present suit filed by the plaintiff is barred by limitation as admittedly the plaintiff was aware of the use of impugned registered trademark by the defendant since first week of June 2018, however, plaintiff took no steps to restrain the defendant from using the impugned registered trademark till July 2021 except for filing a rectification application. However, since the business of defendant was flourishing, plaintiff out of fear of competition and to cause prejudice and disrepute to the defendant, malafidely filed the present suit. The present suit being invoked in July 2021 i.e. beyond three years from the alleged cause of action, is barred by limitation.
CS (Comm) No. 275 of 2021 13/26(c) That, the present suit is not maintainable as the same has become infructuous since the defendant had already given the undertaking for non user of the impugned trademark before the court vide statement dated 19.12.2022 and the defendant has already shut down the said business in its entirety.
(d) That, the plaintiff has averred in its plaint that user by the defendant is in violation of said right of the plaintiff as contemplated under section 29 (4) of Trademark Act, 1999. However, the said provision can only be invoked when the other party is not a registered proprietor of the impugned trademark and hence, it is abundantly clear that the suit has been filed before the court just to harass the defendant.
(e) That, present suit is not maintainable as per section 28 (3) of Trademarks Act which states that " Where two or more persons are registered proprietors of trade marks, which are identical with or nearly resemble each other, the exclusive right to use of any of those trade marks shall not (except so far as their respective rights are subject to any conditions or limitation entered on the register) be deemed to have been acquired by any of those persons as against any other of those persons merely by registration of the trademarks but each of those persons has otherwise the same rights as against other persons (not being registered users using by way of permitted use) as he would have if he were the sole registered proprietor".
(f) That, plaintiff has alleged in its suit that defendant is liable for infringement of its registered trademark whereas, section 30 (2) (e) of Trade Marks Act, states that " A registered trademark is not infringed where the use of registered trademark, being one of two or more trademarks registered under this Act CS (Comm) No. 275 of 2021 14/26 which are identical or nearly resemble each other, in exercise of the right to use of that trademark given by registration under this Act" . Hence, the present suit is liable to be dismissed.
(g) That, as per report of Local Commissioner dated 03.09.2021, no infringing goods as alleged were found in the premises of defendant except for certain moulds and stickers.
(h) That, plaintiff has made frivolous calculation for alleged loss of profit/damages in its evidence affidavit which are totally preposterous and absurd as the plaintiff witness has miserably failed to substantiate those calculations in his cross examination.
(i) Reliance was placed by Ld. counsel for defendant upon Pritikiran Rajendra Katole Vs. Harsha Ravindra Katole, Appeal from Order no. 1302 of 2013 with CAA no. 1551 of 2013, decided on 06.12.2013, wherein it was observed that :
" 6. Section 12 of the Act contemplates and recognizes honest concurrent user. Sections 28 (3) and section 30 (2) (e) of the Act, which are necessary are reproduced as under:
' 28 (3) Where two or more persons are registered proprietors of Trade Marks which are identical with or nearly resemble each other, the exclusive right to the use of any of those trademarks shall not (except so far as their respective rights are subject to any conditions or limitation entered on the register) be deemed to have been acquired by any of those persons as against any other of those persons merely by registration of the trademarks but each of those persons has otherwise the same rights as against other persons (not being registered users using by way of permitted use) as he would have if he were the sole registered proprietor'.
30 (2) (e) A registered trademark is not infringed where the use of registered trademark, being one of two or more trademarks registered under this Act which are identical or nearly resemble each other, in exercise of the right to use of that trademark given by registration under this Act".
The above provisions itself makes position clear that the two or more persons, if are registered proprietor of trademark which are identical with/or nearly resemble each other, the exclusive use of the same trademark is not permissible. Both can use those trademarks for all the purposes. Such two persons cannot prevent each other from using the same registered trademark. The section itself contemplates that such registered trademark needs to be treated as in their individual capacity " the sole registered proprietor". Section 30 (2) (e) of the Act also permits and contemplates that CS (Comm) No. 275 of 2021 15/26 use of such registered trademarks by the other registered owner cannot be treated as infringement" .
(j) That, the judgment relied upon by counsel for plaintiff in Hero Honda Motors Ltd. Vs. Rafiq Menon on the limited aspect of "Damages" is distinguishable from the facts of the present case as the said matter was decided ex-parte by Hon'ble High Court of Delhi wherein the defendant had deliberately stayed away from the proceedings. Hence, the finding in captioned matter is not applicable in the present suit. The facts of Louis Vuitton Malletier Vs. Iqbal Singh & Ors. , relied upon by Ld. counsel for plaintiff on the limited aspect of ' Damages' is also distinguishable from the facts of present case.
(k) That, defendant's operations were restricted to the State of Chhattisgarh. Defendant's premises was situated in Chhattishgarh and the impugned goods were also manufactured in the defendant's premises at Chhattisgarh with supply also in the same area. Besides that, plaintiff has admitted that they were aware of the existence and registration of impugned trademark since 2018, still they took no steps to injunct the defendant from using the impugned trademark.
23. Plaintiff, in the instant matter, is registered trademark holder for trademark PLASTO/PLASTO Label vide different trademark certificates for different classes, as detailed in plaint. Plaintiff is engaged in manufacturing, supplying and exporting extensive range of water storage tanks, PVC Pipes and fittings, C- PVC pipes and fittings, agricultural pipes and fittings, HDPE pipes, casing pipes solvent cement and other allied and cognate goods under the trademark PLASTO/PLASTO Label. Defendant's trademark SHRI PLOSTO is also registered in the name of CS (Comm) No. 275 of 2021 16/26 defendant since 2017. Plaintiff got to know about the registered trademark SHRI PLOSTO of defendant in the first week of June 2018 as claimed by plaintiff. Rectification application was filed before the Registrar of Trademarks Act on 7th June 2018 and after the plaintiff came across the impugned goods of the defendant under the impugned trademark /label SHRI PLOSTO in July 2021, in Shahdara Market, plaintiff filed the instant case against the defendant.
24. In terms of section 28 (3) of Trademarks Act, if two registered marks are identical or merely resemble each other, their registered proprietors will not have any exclusive right over the trademark against each other and both the registered proprietors will be equally entitled to use the mark. Further in terms of section 30 (2) (e) of Trademark Act, use of a registered mark does not infringe upon another registered mark that is identical to or nearly resembles it. Further, registered proprietors and their permitted users have been exempted from the ambit of section 29, which defines infringement. All sub-sections of Section 29 begin with the words, " A registered trademark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use...." Read together, the effect of all these provisions is that if two persons have registered identical or very similar marks, one of them cannot succeed in an action of infringement against the other.
25. In Sau Pritikaran Katole Vs. Sau Harsha Ravindra Katole, Appeal from Order no. 1302 of 2013 with CAA no. 1551/2013 it was held that:
" if two identical/similar trademarks have been registered by different persons, both registered proprietors can use them simultaneously. At the same time, the TM Act does allow one registered proprietor to file a suit for CS (Comm) No. 275 of 2021 17/26 infringement against the other. According to section 124, the defendant in a suit for infringement can raise the defence of section 30 (2) (e) , i.e. to assert that his and the plaintiff's marks are identical/similar registered trademarks. In response, the plaintiff can allege that the defendant's mark is invalid. Section 124 also kicks in if the defendant alleges that the plaintiff's mark is invalidly registered. Once the section is triggered, two things can happen: 1. If proceedings for rectification of the register are pending in respect to the plaintiff's or defendant's mark, the suit for infringement is stayed until the proceedings are disposed off.
2. If no such proceedings are pending, the suit is adjourned, and the concerned party has to apply to the Appellate Board ( now replaced by High court) for rectification of the register. The suit is stayed once rectification proceedings commence. The suit is revived only when the proceedings have been disposed off.
26. In Clinique Laboratories LLC Vs. Gufic Ltd 2009 (41) PTC 41 (Del), Hon'ble High court noted that the Act allows the proprietors of identical/similar registered marks to use them simultaneously. However, the act still envisions the possibility of infringement in such a case. This is clear from the inclusions of section 124 and section 31. Section 124 provides the procedure to be followed in infringement suits where the plaintiff and defendant both possess identical or similar trademark registration. Further section 31 clarifies that registration is merely prima facie evidence of a mark's validity, and not conclusive evidence . It was also noted that once the suit was stayed, the rectifications proceedings would be before the Registrar, who has not been empowered to award interim injunctions. Harmoniously construing these different provisions, the court concluded that plaintiff in such a suit can obtain an interim injunction restraining the defendant from using the trademark, provided he can prima facie establish the invalidity of the defendant's mark" .
27. In terms of judgment placed reliance upon by Ld. Counsel for plaintiff i.e. Dhani Aggarwal Vs. Mahesh Yadav & Ors. 2023 (93) PTC 575 (Del) 41, the evaluation of the better rights between the two registered proprietors have to be ascertained for the grant of relief.
CS (Comm) No. 275 of 2021 18/2628. Both the parties herein are registered trademark holders though plaintiff has claimed the prior user. In terms of case of plaintiff, plaintiff got to know about the impugned registered trademark of the defendant in first week of June 2018. Plaintiff filed rectification proceedings before Trademark Registry on 07.06.2018 and thereafter filed the suit seeking restrain against the defendant from using the impugned registered trademark in July 2021. As stated on behalf of plaintiff, plaintiff investigated the products of defendant in the market but did not find any impugned product of the defendant under the impugned trademark. It is only in second week of July 2021 that the plaintiff for the first time came across the impugned goods of the defendant under the impugned trademark/label SHRI PLOSTO in market of Shahdara District, Delhi. Rectification proceedings, as stated, were still pending.
29. After filing of the case, Local Commissioner was appointed. In terms of report of LC, items bearing the infringing mark i.e SHRI PLOSTO/Label and PLASTO/PLASTO label were procured from the premises of defendant after the search and the photographs of infringing articles were also taken. However, all the photographs of the articles brought on record alongwith report of Local Commissioner bear the trademark/label of defendant SHRI PLOSTO and not the PLASTO/Label as is mentioned in the report of Local Commissioner. It was conceded by Ld. counsel for plaintiff that the above noted is wrongly recorded in the report of Ld. Local Commissioner as all the articles which were seized from the defendant's premises were bearing the mark/label of defendant's mark/label SHRI PLOSTO and not of plaintiff's trademark. Defendant was also registered trademark holder and the CS (Comm) No. 275 of 2021 19/26 court was yet to decide with regard to superiority of the claim of the respective parties . Statement of counsel for defendant was recorded in the court upon the instructions of defendant that defendant was not continuing with the business of manufacturing and sale of water tanks and was also not using impugned trademark/label . It was undertaken that defendant shall not use impugned trademark/label 'Shree PLOSTO' as mentioned in para 55 (a) of the plaint. Hence, in view of the statement on behalf of defendant, defendant cannot continue its operations under the impugned trademark/label . Plaintiff's claim with regard to restrain order against defendant from user of the impugned trademark/label SHRI PLOSTO was satisfied.
30. Nevertheless, to claim the remedy pertaining to damages/rendition of accounts, plaintiff was also required to show that the claim filed by plaintiff was falling in the criteria for 'passing off' or that the defendant earned profits encashing the goodwill of the plaintiff, whereby losses were caused to plaintiff.
31. As laid down in Reckitt & Colman Ltd. Vs. Borden Inc:
" the plaintiff seeking a remedy for passing off must establish three ingredients:
1. The goods or services have acquired goodwill or reputation in the marketplace that distinguishes such goods or services from competitors .
2. The defendant misrepresents his goods or services, either intentionally or unintentionally , so that the public may have the impression that the offered goods or services are those of the plaintiff.
3. The plaintiff has suffered damages because of the misrepresentation ".
32. The term passing off refers to the infringement of trade mark done in such a way that the mark is not only deceptively similar to the trade mark of that other concern but is also capable of creating or is creating confusion for the customers which CS (Comm) No. 275 of 2021 20/26 ultimately results in damage of business of the plaintiff concern. The fundamental principal behind the term passing off is that man cannot sell his goods under the pretence that they are goods of another person.
33. Reliance is placed upon S. Saiyed Meinuddin Vs. P. Sulochna Bai wherein it was observed that :
" passing off right is wider remedy than that of infringement. This is because the passing off doctorine operates on the general principal that no person should sell his business as the business of another person. A person may sell his goods or services as such in case of profession under a trading name or style. With the lapse of time such business or services associated with the person acquire reputation or goodwill/which becomes a property which is protected by courts. A competitor initiating sale of goods or services in the same name or by imitating that name results in injury to the business of one who has the property in that name. The law does not permit anyone to carry on his business in such a way as would persuade the customers or clients in believing that the goods or services belonging to someone else are his or are associated therewith".
34. Reliance is further placed upon Wander Ltd. v. Antox India (P) Ltd, 1990 Supp. SCC 727, wherein it was observed that:
" passing-off is said to be a species of unfair trade competition or of actionable unfair trading by which one person, through deception, attempts to obtain an economic benefit of the reputation which another has established for himself in a particular trade or business".
35. In terms of settled proposition of law, in order to bring home tort of 'passing off', the plaintiff is bound to prove and establish that:
(i) the defendant has made a false representation or employed deception. Mere confusion will not suffice; (ii) because of such false representation, an unwary consumer is deceived and ; (iii) the false representation has injured the plaintiff's goodwill and not just its reputation.CS (Comm) No. 275 of 2021 21/26
36. It is not the case that the defendant made any attempt with user of impugned trademark/label 'SHRI PLOSTO' to deceive the unwary customers that the goods sold by it originated from the plaintiff or that the defendant was selling its products by encashing the goodwill of the plaintiff. With regard to sale in Shahdara area, no document or evidence has been brought on record by the plaintiff. As stated on behalf of defendant, defendant's operations were restricted to the State of Chhattisgarh. Defendant's premises was situated in Chhattishgarh and the impugned goods were also manufactured in the defendant's premises at Chhattisgarh. Local Commissioner visited premises of defendant at Chhatisgarh. There is no evidence brought on record to establish that defendant had made any sales in Shahdara District or anywhere else deceiving the unwary customers to bring home the allegation of ' passing off '.
37. PW1 admitted that the plaintiff company had knowledge of defendant's product since year 2017 but he had no knowledge whether plaintiff company had initiated any proceedings, action/notice etc. post 2017 before filing the present suit against the defendant company. However, it was sought to be explained that suit was filed in 2021 because in the year 2018, after filing of the rectification application, plaintiff investigated the products of defendant in the market but did not find any impugned product of the defendant under the impugned trademark at that time. It is only in second week of July 2021 that the plaintiff for the first time came across the impugned goods of the defendant under the impugned trademark/label SHRI PLOSTO in market of Shahdara District, Delhi. The judgment placed reliance upon by Ld. counsel for defendant may be relevant on the abovesaid aspect. It was CS (Comm) No. 275 of 2021 22/26 noted in Pritikiran Rajendra Katole Vs. Harsha Ravindra Katole (supra):
"8. The prior and /or earlier use and/or long use in the background also loses its importance. There are factual background which shows that parties were fully aware of the use of the word ' Godwa' since long. The appellant is using the word ' Godwa' since February 2008, though the Respondent/plaintiff is using the same word from 2006, no such steps whatsoever taken by the respondent/plaintiff. Both the parties have been using this word in their respective publication/production without interference of each other. The delay may not be the reason not to consider the case of infringement and /or cannot be the reason not to grant the reason (sic) if case is made out, but in a situation like this, where the issue of ' honest concurrent user' itself require consideration and unless the registration of applicant is quashed and set aside, at the instance of other side, the effect of registration of trademark just cannot be taken away by the Court in such fashion. This, in view of the court , is also against the provisions of law apart from the established interest so created in favour of the owner in view of the registration of the trademark.
9. The basic ingredients of principle of injunction prima facie case, irreparable loss and equity are no way can be used and utilized against the statute. The concurrent long use itself is additional factor goes against the plaintiff. The irreparable loss/injury and equity also lies in favour of the appellant/respondent who has been using the trademarks since long which was well within the knowledge of the respondent/plaintiff. The aspect of conduct also goes against the respondent/plaintiff. This, however, in no way, sufficient to decide the claim and/or prayer so made in the main suit ".
38. PW1 also stated that he did not know how the calculation in para 3 of his affidavit records 11 tanks. He sought to clarify that in terms of LC Report, water tank was seized but water tanks can be of 100 to 10,000 lt. capacity and price of 100 liter tank may be around Rs. 500/ to Rs. 60,000/ approximately for 10,000/ liter capacity. The price also varies on the basis of the quality of tanks and the material used in those tanks. Ld. Counsel for plaintiff had contented that stickers of impugned trademark were found in more than 3500 quantity. Moreover, 11 water tanks which were sold in a single day by the defendant, as mentioned in the defendant's objection to LC report, cannot be bypassed to show the quantum of usage of the impugned trademark by the defendant. In terms of the objections of defendant to the LC report, defendant was pressurized CS (Comm) No. 275 of 2021 23/26 to call one of the Distributors and forcefully recall the return of already sold water tanks (11 numbers). From the said objection, nowhere it can be interpreted that 11 water tanks were sold in a single day. Further in terms of report of LC, the articles which were seized were consisting of Roto Moulding Machine, Moulds, Screening, Stickers, Visiting Cards, Pamphlets, Invoices and Computer, which does not even talk about seizure of any tanks.
39. According to PW1, calculation of damages had been done on the basis of availability of moulds at the defendant's premises and not the tanks seized. As stated, the calculation had been made after evaluating the market share of the defendant company in the area of operations. As further stated by PW1, on an average, 50 tanks per day were sold by the defendant company during 2017 till the filing of present case but they had not estimated their own market share in the area of operation, though stated that they had good market in that area. They had no other record or basis of his statement that market presence of plaintiff company was found on decreasing trend except for their knowledge of duplicate products being sold in the market.
40. No document had been brought on record and as admitted by PW1, there was no document or basis for its contention that plaintiff had suffered loss in its market share. According to PW1, as per their knowledge, defendant had been carrying out its business since second week of July 2021, thereby approximate number of days comes down to 44 days as calculated from the date of knowledge till the date of execution of Local Commission on 17.08.2021.
CS (Comm) No. 275 of 2021 24/2641. Apparently, plaintiff is not claiming any damages prior to second week of July 2021 and at the cost of repetition, it may be stated that plaintiff has failed to establish on record its claim of damages or rendition of accounts even for these 44 days for want of any document/evidence on record . PW1 answered as ' Correct' to the question that they had not produced on record any document or basis of nature and quantum of damages which might have been suffered by the plaintiff because of alleged 44 days of operation by the defendant in impugned product. The ground to claim damages for goodwill was only that there was a duplicate product in the market. In view of the testimony of PW1, the claim of damages by plaintiff seems to be based upon the assumption than the actual damage caused, dis-entitling the plaintiff to claim damages from defendant.
42. Observation in the Judgment relied upon by Ld. counsel for plaintiff himself i.e. Louis Vuitton Malletier Vs. Iqbal Singh & Ors. (supra), supports the case of the defendant. It was observed that :
" 30. Although the plaintiff may be correct in submitting that there may not be any precise calculation for estimation of the profits on account of illegal activities such as those practiced by the defendants, but the court would not like to lose sight of the fact that the plaintiff has not led any evidence with respect to the quantum of damages suffered by the plaintiff.....
31. The report of Local Commissioner also does not show the extent of the business operations of the defendants for the court to arrive at the correct measure to award damages. The damages have to be proved by the party asserting loss and the same is sine qua non for award of damages...... ".
43. As already noted, in absence of the evidence with regard to the quantum of damages based upon the plea of ' passing off ', the claim of plaintiff pertaining to issue no.1 fails. Issue no.1 stands decided against the plaintiff.
CS (Comm) No. 275 of 2021 25/2644. Relief: In view of the statement on behalf of defendant dated 19.12.2022, defendant is restrained by itself as also through its partners, agents, franchise(s) representatives, distributors, assigns, heirs, successors, stockists and all other acting for and on its behalf from using, selling, soliciting, exporting, displaying, advertising or by any other mode or manner dealing in or using the impugned trademark/label 'SHRI PLOSTO' in relation to impugned goods and business. Claim of plaintiff pertaining to damages/rendition of account stands dismissed. Parties are left to bear their own costs.
45. Decree sheet be prepared accordingly. After completion of formalities, files be consigned to record room.
SAVITA Digitally signed by
SAVITA RAO
RAO Date: 2023.05.02
15:14:00 +0530
Announced in the open (SAVITA RAO)
court on this 2nd day DISTRICT JUDGE
of May 2023 (COMMERCIAL COURT)-04
SHAHDARA, KKD COURTS,
DELHI
CS (Comm) No. 275 of 2021 26/26