Delhi District Court
Diamond Modular Pvt. Ltd vs Yash Arora And Anr on 9 July, 2024
IN THE COURT OF MS. ANURADHA SHUKLA
BHARDWAJ: DISTRICT JUDGE (COMMERCIAL
COURT)-02, SOUTH DISTRICT, SAKET, NEW DELHI
CS (Comm.) No. 125/21
1. DIAMOND MODULAR PVT. LTD.
RZ-283/47A, Vishnu Garden Extension-I
Gali No.5, Near Khailia,
New Delhi-110018.
...PLAINTIFF
Versus
1. YASH ARORA
TRADING AS,
SIDDHI VINAYAK TRADERS
95/ 147, GUPTA COLONY,
T.P NAGAR, MEERUT,
UTTAR PRADESH
....DEFENDANT NO.1
2. SIDDHI VINAYAK TRADERS
95/147, GUPTA COLONY,
T.P NAGAR, MEERUT,
UTTAR PRADESH.
....DEFENDANT NO.2
Date of filing of the suit : 19.03.2021
Date of reserving judgment : 31.05.2024
Date of judgment : 09.07.2024
JUDGMENT
1. This is a suit under sections 134 & 135 r/w section 27 (2) of the Trade Marks Act, 1999 seeking permanent injunction to restrain, passing off, infringement of CS (COMM) 125/21 Page 1 of 34 Diamond Modular Pvt. Ltd.
Vs. Yash Arora & Anr.
Trademark, Rendition of accounts, delivery up etc. The plaintiff has made two defendants - proprietorship firm and the proprietor. Under the law proprietorship firm has no legal existence, therefore, the judgment shall be pronounced against defendant no.1 only, who is the proprietor of defendant no.2.
2. Brief facts as per plaint are that the Plaintiff, Diamond Modular Private Limited, is a company duly incorporated under the Companies Act, 1956. The Plaintiff through its predecessors is engaged in the business of electrical goods and accessories since the year 1975. Plaintiff's predecessor adopted and started using the trademark and trade name DIAMOND in relation to their business in the year 1975 itself.
3. It is stated that Plaintiff is the owner and proprietor of the trademark DIAMOND in relation to its business on account of honest prior adoption and long and extensive use in the course of trade. Plaintiff uses the trademark DIAMOND as word mark and in artistic logo/label form (Hereinafter collectively referred to as the said trademark). In order to get statutory protection, the Plaintiff got the said trademark registered in its favour under the provisions of Trade Marks Act, 1999. Details of Plaintiff's registration of the trademarks are mentioned in Para 7 of the Plaint.
CS (COMM) 125/21 Page 2 of 34 Diamond Modular Pvt. Ltd.
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4. It is averred that the goods and business of the Plaintiff bearing trademark "Diamond" are highly demanded in the market on account of their standard quality and precision. The Plaintiff has already built up a handsome and valuable trade there under. Plaintiff has been regularly and continuously promoting it's trademark through extensive advertisements, publicities, promotions, marketing & marketing research and the Plaintiff has been spending good amount of moneys, efforts, and time thereon. It is stated that Plaintiff is also carrying on its business activities under the said trademark on the internet through its website namely https:// www.diamondindia.co.in/ . Furthermore, with the rapid growth of online market, the Plaintiff Company has evolved with time and its wide ranges of products are now available online for customers from any corner of the globe on various online market places like https://www.amazon.in/; https://www.flipkart .com/ etc. Plaintiff has also social media presence on https://www.facebook.com/
5. It is stated that the plaintiff had a turnover of Rs.23,70,90,206 crores during the Financial Year 2020 in respect of the retail stores under the said trade mark. The details of sales from 2013-14 have been provided in the plaint.
CS (COMM) 125/21 Page 3 of 34 Diamond Modular Pvt. Ltd.
Vs. Yash Arora & Anr.
6. It is stated that Defendant Yash Arora, trading as, Siddhi Vinayak Traders 95/ 147, Gupta Colony, T.P Nagar, Meerut, Uttar Pradesh is engaged in the business of electrical goods and accessories (hereinafter referred to as "the impugned goods"). That the Defendant has adopted and started using the trademark GREEN DIAMOND as word mark and with device represented as wherein the word/mark GREEN DIAMOND forms essential Part (hereinafter referred to as the "impugned trademark"). It is stated that the impugned trademark adopted and being used by the defendants in relation to their impugned goods and business are identical with and deceptively similar to the Plaintiff's said trademark and trade name in each and every respect including phonetically, visually, structurally, in its basic idea and in its essential features.
7. It is stated that dishonesty of the Defendants is apparent from the fact that the Defendant No. 1's father Mr.Vinod Kumar Arora was running Satish Electric Store from the same address and the Defendant itself was one of the dealers of the plaintiff's product under the said trademark who defaulted in making payment to the tune of Rs.32,88,444.94 w.r.t LED products supplied by the Plaintiff and therafter, the Plaintiff issued legal notice dated 23.12.2020 to him which was falsely and vaguely replied by the defendants vide reply notice dated CS (COMM) 125/21 Page 4 of 34 Diamond Modular Pvt. Ltd.
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29.12.2020 and consequently proceeding have been initiated by the Plaintiff under Section 18(1) of Delayed Payment to MSE of the Micro, Small and Medium Enterprises Development Act, 2006.
8. The defendants put in appearance upon service of summons. Matter was referred to mediation by court, however, it could not be settled. Written statement was filed by defendants, wherein they denied the contents of plaint. It is stated that the suit filed by the Plaintiff is not maintainable against the Defendants.
9. It is stated in the WS that the defendant is engaged in a well-established and reputed business of "Electrical Accessories including Wire And Cables, Electrical Conduit, Switch & Switches Accessories, Socket, M.C.B. Box, Junction Box, Joint boxes for housing cable joints, Change Over, Capacitors, Electrical Capacitors, Condensers (Capacitor), Switchgears, Fuse, Bus Bars, Electric Cord, Electrical Power Extension Cord, Electrical Connectors, Multi-Plugs, Distribution Box, Electric Control Panels, Electrical Sockets" included in Class 9 and "Fans, Exhaust Fans, Coolers, Air Conditioners, Refrigerators, Toaster, Geysers, Electric Oven, Electric Kettle, Electric Roti Maker, Heat Convectors, Heaters, Heating Element, Heating Rod, Hot Water Boiler, Solar Light, Led Light & Bulbs, Cfl, Tube Light, Night Lights, Table Lamps, Llalogen Lamps, Cfl Lamps And Tubes, CS (COMM) 125/21 Page 5 of 34 Diamond Modular Pvt. Ltd.
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Bulbs, Torches, Electric Emergency Light, Induction, Electric luminaires, LED luminaires, Cooker, Electric Hot Plates for Cooking, Gas Lighters, Electric Gas Stove and their parts" included in Class 11 (hereinafter be referred to as said goods, business and Services).
10. It is further stated that the Defendants are the registered proprietor of the Trademark 'GREEN DIAMOND' under class 9. Details of the said trademark registration are listed herein under:
S.No. Application No. Trademark Class Status
1. 4290006 Green diamond 09 Registered
11. It is further stated that the art work involved in the said trademark 'GREEN DIAMOND' is original artistic work within the meaning of the Indian Copyright Act, 1957 (Copyright Act) and the Defendant has applied for its registration.
12. It is further stated that the Company SIDDHI VINAYAK TRADERS was established in the year 2018. It is stated that the said trademark is an invented term and the Defendants coined, conceived and adopted the said trademark in respect of above said goods. The adoption of the trade mark is honest and bonafide. The said trademark is highly distinctive and can be distinguish Defendant's goods from those of others.
CS (COMM) 125/21 Page 6 of 34 Diamond Modular Pvt. Ltd.
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13. It is stated that the trademark of the Defendants, by virtue of honest and bonafide adoption in respect of stated goods has acquired immense popularity coupled with factual distinctiveness indicating the goods of the Defendants only and none else.
14. It is stated that the Defendant submits that the said trademark has become known amongst consumers and in trade circles and has attained distinctiveness pursuant to its genuine, honest, bonafide and uninterrupted adoption. The Defendant submits that the trademark relates to the Defendants and the customers have widely admired and accepted the quality goods of the Defendants. It is a highly reputed mark and by such extensive and continuous use has acquired uniqueness and exclusivity which requires protection under the Trade Marks Act.
15. It is further stated that the Defendant by virtue of honest adoption and distinctiveness, has acquired common law rights to use the said trade-mark. The Defendant with an intention to increase sales and sustain in the long run has spent considerable sum of the sales in advertising.
16. It is stated thatthe Defendants had applied for registration of the said trademark under Application No. 4290006 in Class- 9 and under Application No. 4290007 in Class-11 and have successfully acquired registration under Class 9 on 14/03/2020 in the Trademark Journal No. 1946 CS (COMM) 125/21 Page 7 of 34 Diamond Modular Pvt. Ltd.
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vide Certificate No. 2421264. The registration under Class-11 is at a procedural stage and registration thereof will be granted after following due procedural formality.
17. It is stated that the Defendants coined, conceived and adopted the distinctive trademark. The Defendants have been using the said trademark in respect of the said Services and the same on account of its voluminous use and high quality of goods has acquired distinctiveness.
18. It is stated that the rival marks are dissimilar and highly distinctive upon comparison. As per the well-settled principle of entirety, the marks should be considered as a whole and not anatomized into their constituent parts. When this principle is applied to the instant case, the Plaintiff s Mark i.e., DIAMOND comes across as visually, phonetically and structurally dissimilar from the Defendant's Mark.
19. It is also stated that it is well established principle that monopoly cannot be claimed over the words which are laudatory and common to trade as per Section 17 (2) (b) of the Trade Marks Act, 1999, which thereby states that when a trademark contains any matter which is common to trade or is otherwise of a non-distinctive character, the registration thereof shall not confer any exclusive right in the matter forming only a part of the whole of the trademark so registered. There are various trademarks CS (COMM) 125/21 Page 8 of 34 Diamond Modular Pvt. Ltd.
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comprising of word "DIAMOND" which are already registered and available on the website of Trademark Registry, therefore no one can claim monopoly over the word "DIAMOND".
20. It is further stated that the Plaintiff s Mark itself is subsequent to "DIAMOND" marks that were already existing on the Trade Marks Register. Moreover, there are several "DIAMOND" per se and formative marks that are currently co-existing on the Trade Marks Register. As such, the Plaintiff cannot claim any monopolistic or exclusive rights over the suffix "DIAMOND" and thus cannot prohibit any other entity from adopting a "DIAMOND" formative mark.
21. It is further stated that the Defendants has made huge Investment of time, efforts, resources and money in conceptualization, development and marketing of the said goods under the trade mark. That the Defendants has gained tremendous reputation and goodwill in the market on account of manufacturing, marketing and distribution of its brands and superior quality products/items. Further, it is the established principle that a generic term can never be granted registration and/or protection as a trade mark under the Act.
22. On pleadings of the parties, following issues were framed on 28.01.2022:-
CS (COMM) 125/21 Page 9 of 34 Diamond Modular Pvt. Ltd.
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1. Whether the trademark of defendant GREEN DIAMOND in device form is deceptively similar to the trademark DIAMOND belonging to the plaintiff. And if so, whether defendants are infringing the trademark of the plaintiff and also passing off the goods of the plaintiff?
OPP
2. Whether the defendants are passing off the copyright of the artistic work of plaintiff brand "DIAMOND" ? OPP
3. Whether the plaintiff has not come to the Court with clean hands and whether the facts of not disclosing other proceedings going on between the parties in other forums i.e. Recovery Suit filed by defendant at Meerut Court and Criminal complaint in Meerut Police Station are material ? OPD
4. Whether the plaintiff is entitled to relief of permanent injunction as prayed in para 32 of the plaint? OPP
5. Whether the plaintiff is entitled to the relief of rendition of accounts?
OPP
6. Whether the plaintiff is entitled to costs? OPP
7. Relief.
23. The plaintiff has filed affidavit of Rajesh Gupta-
director of plaintiff company deposing on the basis of CS (COMM) 125/21 Page 10 of 34 Diamond Modular Pvt. Ltd.
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board resolution dt. 15.02.2021, which has been exhibited as Ex.PW1/15. Plaintiff has deposed in terms of plaint. In cross-examination witness stated that his father had adopted trademark in 1971. His father had expired in 1988, whereafter his mother became the proprietor of trademark. He had joined the business of his father in 1986 when he was 16 years old as his father was not keeping well. He clarified that 1984 in para 5 of his affidavit was written under some confusion and that it was in 1986 that he joined the business. It is stated that in the year 1995 the firm New Diamond Electrical was transferred in the name of his wife and he started a new firm in the name of Diamond Enterprises. The trademark rights remained with his wife from 1995 till 2001. In 2001 the trademark was transferred to his name by way of assignment deed and in the year 2018 the two firms were merged to give way to Diamond Modular Pvt. Ltd, a private limited company. The witness stated that he knew defendant no.1 and his father Mr. Satish Arora and their firm M/s Satish Electrical Store was distributor of plaintiff for about 10 years for electrical goods i.e switches, wires, cable LED lights. He stated that plaintiff's last activity with M/s Satish Electrical Store was on 16.01.2020. The witness stated that he was not aware if any firm or company was using his trademark Diamond except defendant. He stated that plaintiff used artistic logo of "Diamond" everywhere except in some items, as it has been registered. He stated CS (COMM) 125/21 Page 11 of 34 Diamond Modular Pvt. Ltd.
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that he did not produce any documentary evidence of straight font usage of trademark Diamond.
24. The defendant no.1 tendered its evidence in terms of the WS. In cross-examination the witness stated that he was the proprietor of M/s.Siddhi Vinayak Trader (D-2) and was running business since 2018. It was stated that prior to 2018 his father was running the business under the name and style of M/s. Satish Electrical Store for almost 20 years. Witness stated that they were distributors of different brands under the name and style of M/s.Satish Electrical Store. He knew the plaintiff since 2018 after entering the business and that he had stopped dealing with them in January, 2020. The witness stated that he was dealing in wires and cable and volunteered that he was not dealing in wires and cables with plaintiff with whom he only dealt in switches and accessories. Witness admitted that plaintiff company was having trademark Diamond on the device of its product and further stated that he adopted the trademark Green Diamond in 2019. He stated that he had applied for trademark of registration of Green Diamond in 2018 under class 9 and 11 and that he had made a trademark search before applying for trademark Green Diamond. He stated that he had applied for word mark registration for the word Green Diamond. He stated that he was using Green Diamond trademark logo while dealing with plaintiff company. He stated that he had not filed on record any document in relation to promotion, CS (COMM) 125/21 Page 12 of 34 Diamond Modular Pvt. Ltd.
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advertisement of his trademark being Diamond but volunteered that Ex.DW1/3-A showed the advertisement, hoarding of green diamond over another store. In answer to the question that during trademark search defendant had come across plaintiff's trademark diamond, witness stated that he had made search for trademark Green Diamond.
25. Written Submissions were filed by both the parties.
Mr.Siddharth Swain, Adv. argued the matter on behalf of Plaintiff and Mr. Chetan Kumar Giri, Adv. argued on behalf of defendants.
26. On the basis of evidence and arguments advanced by the Ld. Counsels issuewise findings are as under:
27. Issue No.1:- Whether the trademark of defendant GREEN DIAMOND in device form is deceptively similar to the trademark DIAMOND belonging to the plaintiff. And if so, whether defendants are infringing the trademark of the plaintiff and also passing off the goods of the plaintiff? OPP Issue No.2:- Whether the defendants are passing off the copyright of the artistic work of plaintiff brand "DIAMOND" ? OPP and Issue No.4:- Whether the plaintiff is entitled to relief of permanent injunction as prayed in para 32 of the plaint? OPP
28. The admitted case of the parties is that defendant is registered owner of trademark 'Green Diamond' under CS (COMM) 125/21 Page 13 of 34 Diamond Modular Pvt. Ltd.
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category 9 and has applied for the registration under category 11. The plaintiff has filed cancellation in respect of registration under category 11 and rectification in respect of registration under category 9. In view of settled law the injunction cannot be granted for infringement against a registered trademark, however, proceedings for injunction for passing off can lie even against a registered trademark (reliance placed on M/s. J.K.Oil Industry Vs. M/s.Adani Wilmar Ltd. CS (COMM) 109/2018 dt. 29.05.2018. Accordingly, the suit shall be considered for the action of passing off against the defendant.
29. The defendant in the arguments has challenged the rights of plaintiff in trade mark Diamond. It was argued by Ld. Counsel for the defendant that there is not enough evidence to show that the plaintiff has been using the trademark uninterruptedly. Ld. Counsel for plaintiff argued that plaintiff through its predecessors had adopted the trademark 'Diamond' in relation to the business of electrical goods and other allied and related goods and had been using the same as such by itself and also in artistic manner since the year 1975. Plaintiff has relied upon Ex.PW1/3-A to 3-D. Ex.PW1/3-A is trademark certificate issued on 08.06.1978 in the name of Ramesh Kumar Gupta vide registration no. 337296. The registration of word 'Diamond' is in respect of lampshade holders in class 11. Yet another registration of word 'Diamond' is under class 9 vide registration no.426403 dt. 28.08.1984. Ex.PW1/3-B CS (COMM) 125/21 Page 14 of 34 Diamond Modular Pvt. Ltd.
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is registration of word Diamond in class 9. The trademark no. 709961 dt. 08.04.1996 (Ex.PW1/3-B). There is yet another registration no.831578 dt. 11.12.1998 of word Diamond in class 9 in respect of accessories including switches sockets, plug toppin holder, fuse, voltage stabilizer, transformer, iron, kettles, wires & cables conduit pipe, hoke patti starter. The documents indicate that word 'diamond' in respect of articles falling under category 9 and 11 were registered in the name of plaintiff's predecessors since 1970s & 80s.
30. In the cross-examination PW-1 stated that the trademark Diamond was adopted by his father in the year 1971 and after his death in 1988 his mother became the proprietor of trademark. He has stated that he joined the business with his father as his father was unwell in 1986 when he was in class 10th. The witness has clarified that he has inadvertently written 1984 in his affidavit as he was confused. He deposed that he was carrying the business while his mother was the proprietor on paper. The witness has clearly deposed and reaffirmed in cross-examination that trademark was transferred in his name in the year 2001 and in the year 2018 two firms i.e M/s.New Diamond Electrical being run by his wife and M/s.Diamond Enterprise being run by him had assigned the trademark to the Private Limited Company M/s.Diamond Modular Pvt. Ltd. (plaintiff). The assignment deed dt. 19.07.2018 has been exhibited as CS (COMM) 125/21 Page 15 of 34 Diamond Modular Pvt. Ltd.
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Ex.PW1/14, which has remained unchallenged. No suggestion has been given to the witness in cross- examination that its user claim since 1975 was incorrect. There is no challenge in cross to trademark registration Ex.PW1/3-A to 3-D dating back to 1978, 1984, 1996 and 1998.
31. In para 10 of the affidavit PW-1 has given sales figure of plaintiff using trademark "Diamond" since 2013- 2014 when the sales were of Rs.20,973,125 to 2021 when the sales were Rs.237,090,206. There is no cross- examination of the witness on this aspect by Ld. Counsel for defendant. The figures are from 2013-2014, which is prior to 2020 when the defendant started using trademark 'Green Diamond' (as admitted by him in his cross- examination dt. 28.07.2022). It is settled law that if the witness is not cross-examined on any point specifically pleaded and stated on oath, that fact shall be deemed to have been accepted. Reliance placed upon the judgments in Union of India & Anr. Vs. Rashid M.H. Jung, RFA no. 794/2017 decided on 18.09.2017 & Vijay Sarohi Vs. Sushil Sharma, RSA no. 127/2013 decided on 05.03.2014.
In 1987 (2) Rent Law Reporter (Cal.) (DB) 458 it was held that failure to cross examine a witness on a material particular may amount to acceptance of his statement on that point.
In view of non cross-examination of plaintiff in respect of the registration certificates, transfer of CS (COMM) 125/21 Page 16 of 34 Diamond Modular Pvt. Ltd.
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Trademark to plaintiff's name and sales figure as pleaded in plaint and tendered in evidence, the defendant has failed to challenge the goodwill and reputation of mark 'DIAMOND' pleaded by plaintiff. Argument of Ld. Counsel for defendant that the plaintiff has failed to get sufficient evidence in support of its user claim is therefore, not tenable.
32. In so far as argument of Ld. Counsel for defendant regarding continuous and uninterrupted proof of advertisement, sales and promotion activity, though the plaintiff has given evidence of continuity of use since 2013; qua the use since 1978, Ld. Counsel for plaintiff has relied upon judgment in Century Traders Vs. Roshan Lal Duggar & Co AIR 1978 Delhi 250, wherein the Hon'ble Court held that actual use of the trademark under such circumstances as showing an intention to adopt and use it as a trademark is the test rather than extent or duration of the use to prove proprietorship of the trademark.
Be it whatever, there is no dispute that the trademarks were registered in the name of predecessors of plaintiff since as early as 1978, 1984, 1996 and 1998, and it has proved the sales figure for more than 10 years as of now since 2013-2014. Further there is admission of DW-1 that his father's firm M/s. Satish Electrical Store was having business dealings with plaintiff for 10-15 years and the products of defendant used to have trade-mark Diamond on the device of product, the defendant cannot dispute CS (COMM) 125/21 Page 17 of 34 Diamond Modular Pvt. Ltd.
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continuous and uninterrupted use of trademark "Diamond" by the plaintiff, which was prior in time.
33. It is admitted fact claimed by plaintiff and admitted by the defendant that the defendant was plaintiff's distributor and that in 2018, the defendant severed its relations with plaintiff whereafter it started manufacturing its own goods in similar categories under the trademark 'Green Diamond' with a picture of trees. Regarding the picture of tress, DW-1 stated in cross-examination that he had copied it from Internet. The claim of plaintiff that the trademark Green Diamond with picture of trees is thus falsified.
34. DW-1 in his cross-examination stated that his father used to run business in the name of M/s. Satish Electrical Store before 2018 and that under the said name and style they were distributors of different brands. He admitted that he was the distributor of the plaintiff company. Initially he stated that he used to deal with wires and cables but volunteered that he was not dealing with wires and cables with plaintiff company and that he used to deal with plaintiff company in switches and its accessories. The fact, however, remains that the articles mentioned fall in the category of electrical goods.
35. The witness admitted that plaintiff company was having trademark "Diamond" on its devices of products.
CS (COMM) 125/21 Page 18 of 34 Diamond Modular Pvt. Ltd.
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He stated that he did not know anything about the trademark registration for the word "DIAMOND" of the plaintiff company. He stated that he had applied for trademark registration of green diamond in 2018 under class 9 & 11. Witness stated that dispute between his father's firm M/s.Satish Electrical Store and plaintiff company had started before he got proprietorship of business in 2018 under the name and style of M/s. Siddhi Vinayak Traders. There is no document brought on record to show as to when the dispute had actually arisen.
36. The defendant stated in his cross examination that he was using the trademark Green Diamond even while he was dealing with plaintiff. The statement, however, is falsified from the two statements of PW1 and DW1 having come on record. PW1 stated in his cross examination that he was dealing with defendants till 16.01.2020. DW1 stated in his cross examination that he started using trademark Green Diamond in 2020. The invoices filed by DW1 are also of 2020. Therefore, the claim of defendant that he was using the impugned trademark while dealing with plaintiff is contrary to record.
37. It has been claimed in the written statement and also in the evidence by defendant that he has spent a lot of money in building up its business under the trade name/ trademark Green diamond. There is, however, no evidence on record to suggest such investment in advertising etc. CS (COMM) 125/21 Page 19 of 34 Diamond Modular Pvt. Ltd.
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Witness DW-1 admitted in cross examination that he had not filed on record any document in relation to promotion, advertisement of this trademark but then volunteered that Ex.DW1/3-A shows the advertisement hoarding of green diamond over another store. Ex.DW1/3-A is a photocopy of Ex.EW1/3-D. Ex.DW3-A & 3-D are clearly in respect of the same shop. Apart from this there is no document on record to show the money spent by defendant on the advertising and marketing. In so far as sales and related documents filed by defendant are concerned, it was argued by Ld. Counsel for the plaintiff that since defendant admittedly was a dealer of plaintiff, the purchases having been made on assumption that the goods were coming from plaintiff cannot be ruled out. It also needs to be considered that defendant if it had built a reputation within a span of one year, the reputation would have been lost also over the period of three years when the defendant was restrained from using this trade-mark by the court.
38. It was argued by Ld. Counsel for the defendant that as per well settled principle monopoly cannot be claimed over words which are non-distinctive and common to trade as per section 17 (2) (b) of the Trademark Act. It is claimed that word DIAMOND is common and generic having a dictionary meaning and since the plaintiff had adopted a mark which is generic and common to trade, it runs the risk of lower level of protectivity. The defendant in this regard had relied upon the judgment in M/s.Three-N-
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Products Pvt. Ltd. Vs. M/s.Kairali Exports & Ors. (2018) 73 PTC 324 Delhi. It was held in the said judgment that "The protection of a trademark is dependent on whether the mark adopted is generic, descriptive, suggestive, arbitrary or fanciful. The marks, which are generic, descriptive or suggestive have lower level of legal protectability and the marks, which are arbitrary or fanciful, have higher level of legal protectability. If a person adopts a mark, which is generic or descriptive in nature, he runs the risk of the mark having a lower level of legal protectability."
He has also placed reliance on Skyline Education Institute (India Pvt. Ltd.) Vs. S.L.Vaswani & Anr. 2010 (42) PTC 2017 SC, wherein the Hon'ble Supreme Court took note of the fact that Skyline was a mark used commonly for the educational institutes and therefore, the plaintiff of the said case could not claim any monopoly over it. Ld. Counsel has also relied upon the judgments in N.Ranga Rao & Sons Pvt. Ltd. Vs. Sree Annapoorna Agro Foods, No.98E, Karattu Thottam, Erode 638 004, Civil Suit No. 259/2017 dt. 17.08.2021; Living Media India Ltd.
& Ors. Vs. Alfa Dealcom Pvt. Ltd. & Ors.
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MANU/DE/0295/2016; ITC Ltd. Vs. Nestle India Ltd.
MANU/TN/3708/2020.
39. Ld. Counsel has also relied upon judgment in Kiran Singh & Ors. Vs. Chaman Paswan & Ors.
MANU/SC/0116 & Chief Engineer, Hydel Project & Ors. Vs. Ravinder Nath & Ors. MANU/SC/0573/2008 to dispute the jurisdiction of the court. In Chief Engineer (Supra) it was held that "though in the aforementioned decision these observations were made since the defendants before raising the objection to the territorial jurisdiction had admitted that the court had the jurisdiction, the force of this decision cannot be ignored and it has to be held that such a decree would continue to be a nullity." Admittedly, no issue was framed on the point of jurisdiction. Ld. Counsel for the defendant did not challenge the jurisdiction in the written arguments filed by it. No suggestions etc. were given to the plaintiff on the point of jurisdiction. The plaintiff has claimed in its plaint as also in evidence that he is selling the goods online, it maintains a website namely https://www.diamondindia.co.in/ and is also selling its product on various online market place like https://www.amazon.in and https://www.flipkat.com. In view of settled law on the points a plaintiff who is offering its products online will have a right to file a case before the court in the jurisdiction of which his products can be accessed online. There is thus no strength in the argument CS (COMM) 125/21 Page 22 of 34 Diamond Modular Pvt. Ltd.
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of Ld. Counsel for defendant that this court does not have territorial jurisdiction over the subject matter.
40. In so far as argument of Ld. Counsel regarding the word DIAMOND being used by several others is concerned, Ld. Counsel for plaintiff argued that third party use is no defence in action for infringement. He argued that defendant has sought registration of impugned mark Green Diamond, which is similar to the trademark Diamond and is therefore, estopped from contending that trademark Diamond cannot be associated with the plaintiff, as it is known business name. There is no evidence on record in respect of claim of the defendant that there were prior users of word DIAMOND than plaintiff. He is relying upon a list, which, however, does not show as to when which name was got registered. It is settled law that a party making a claim has the onus to prove it.
41. In so far as Judgment of Hon'ble Supreme Court in Skyline (supra) N. Rangarao (Supra) & other cited judgments are concerned, the defendant could have gotten benefit of the judgment had the case of defendant been that he was one of the random users of trade-mark GREEN DIAMOND having chosen DIAMOND like several others. The facts of the present case, however, are distinguishable since the defendant is definitely not a random bonafide adopter of trade-mark 'GREEN DIAMOND'. He was CS (COMM) 125/21 Page 23 of 34 Diamond Modular Pvt. Ltd.
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distributor of plaintiff for a good 10-15 years before he decided to adopt the impugned trade-mark.
DW-1 has admitted in his cross-examination this fact and also the fact that he used to deal with plaintiff in switches and accessories. It can also be seen from the record that defendant applied for registration of trademark 'GREEN DIAMOND' after dispute arose between him and plaintiff as it is admitted in cross-examination by DW-1 that he had applied for registration in 2018 and also that the dispute between his father's firm M/s. Satish Electrical Store arose before he got proprietorship of business in 2018. It is not the case of defendant that he was dealing with more than one dealer who had 'DIAMOND' as a trade-mark or any similar trade-mark for the goods under categories 9 & 11.
Since the defendant admittedly was dealing with the products of plaintiff for a considerable time of 10-15 years, the chances of confusion amongst the public that the goods being sold by it under the trade name 'GREEN DIAMOND' also belonged to plaintiff, were much higher than it would have been in case if a stranger- having no dealing whatsoever with plaintiff- had adopted the trademark like that of the defendant.
42. Under similar facts in FMI Ltd. Vs. Ashok Jain & Ors. (MANU/DE/3789/2006), the Hon'ble High Court while discussing similarities in the trade-mark CS (COMM) 125/21 Page 24 of 34 Diamond Modular Pvt. Ltd.
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FREEMANS of the plaintiff and FREEDOM of the defendant had held as under:-
"The two words may not be exactly same, but adoption of the word FREEDOM, which resembles closely with the trademark FREEMANS of the plaintiff, with same clientele, may lead to confusion. It is the word FREE appearing in the plaintiff's trademark which has been tried to be exploited by adopting the word FREEDOM. Had there not been any association of the defendants with the plaintiff and they had not represented the plaintiff as its distributors for a long period of 25 years by selling their goods and establishing their own reputation as FREEDOM FITEWALLA, things could have been different. The customers who had been buying the goods of the plaintiff from the defendants earlier with prominence of FREE in their mind are likely to be confused that these are the same goods sold by the defendants and, therefore, are of the same quality and reputation.
CS (COMM) 125/21 Page 25 of 34 Diamond Modular Pvt. Ltd.
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43. It was argued by Ld.Counsel for the plaintiff that the act of defendant in adopting the impugned trademark was calculated and full of malafide and was done with an intention to encash the reputation and goodwill built by plaintiff over the years. In Laxmikant V. Patel Vs. Chetanbhat Shah & Anr. AIR 2002 SC 275, it was held by Hon'ble Supreme Court:
"an action of passing off will then lie wherever the defendant company'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. If this is not made out there is no case. The ground is not to be limited to the date of proceedings; the court will have regard to the way in which the business may be carried in the future, and to its not being carried on precisely as carried on at the date of proceedings."
44. The Hon'ble Court had further held in the aforesaid matter that even if the trade-mark was adopted by a defendant innocently the very fact that confusion can arise regarding it being sourced from plaintiff would be a reason good enough to grant injunction to such plaintiff as it CS (COMM) 125/21 Page 26 of 34 Diamond Modular Pvt. Ltd.
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would be a case of passing off. In the instant matter the plaintiff is alleging malafide, however, even if the stand of defendant that the adoption was bonafide is considered as correct, the chances that general public might relat the products of defendant with plaintiff on account of their past relation are very high.
45. It was argued by Ld.Counsel for the defendant that the trademark of defendant is distinguishable on account of addition of word Green before Diamond.
Hon'ble Delhi High Court in case titled as Vinita Gupta Vs. Amit Arora, CS(COMM) 395/2022 while discussing Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980, held as under:-
"In my view, in the present case the impugned trademark is deceptively similar to the trademark of the Plaintiff and the addition of the prefix 'NU' cannot take away the semantic similarity between APPLESTREE and APPLEPLANT.
46. It was argued by Ld. Counsel for the defendant that the word "DIAMOND" was generic. In Automatic Electric Ltd. Vs. R.K.Dhawan, 1999 SCC Online DEL 27, Hon'ble Court held as under:-
"16. The defendants got their CS (COMM) 125/21 Page 27 of 34 Diamond Modular Pvt. Ltd.
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trade mark "DIMMER DOT"
registered in Australia. The fact that the defendant itself has sought to claim trade proprietary right and monopoly in "DIMMER DOT", it does not lie in their mouth to say that the word "DIMMER" is a generic expression. Reliance is also placed on 2022 SCC Online Del 3275 titled PEPS Industries Pvt Ltd Vs Kurlon Limited. Hon'ble Court in the cited judgment held that the mark "No turn' which was being contested for being descriptive of mattresses was prima facie, not escriptive generally of the mattresses but can be called to be communicating peculiar quality or features of mattresses.
47. In Telecare Network India Pvt. Ltd Vs. Asus Technology Pvt. Ltd. and Ors., MANU/DE/1838/2019, the Hon'ble Court had discussed the four categories of trademarks as (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful. It was held that the latter three categories of marks, because of their intrinsic nature serves to identify a particular source of a product, are deemed inherently distinctive and are entitled to protection.
Applying the law and principle discussed and laid down in aforementioned judgments to the facts of the case, word 'DIAMOND' is not associated with services being rendered by the plaintiff directly. To call a word generic it CS (COMM) 125/21 Page 28 of 34 Diamond Modular Pvt. Ltd.
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needs to be shown that the word can be connected with the source of product or directly with the product in any manner. Trademark of plaintiff 'DIAMOND' is neither generic nor descriptive or suggestive of the goods being sold by plaintiff, which are electrical appliances and allied goods.
48. Ld. Counsel for defendant also relied upon judgment in Phonepe Private Ltd. Vs. Ezy Services & Ors. 2021 (86) PTC 437 (Del), wherein Hon'ble High Court held that no exclusivity can be claimed over a descriptive mark or descriptive mark of part even by misspelling it subject to exception. The Hon'ble Court was dealing with trademark PhonePe & BharatPe. In the cited judgment the word pe which is descriptive of pay was considered for digital payments. As stated hereinabove word DIAMOND is not descriptive of Electrical appliances.
49. There is not much evidence on the aspect of infringement of copyright in the artistic work of plaintiff, the plaintiff, however, in view of above discussion, facts, evidence and cited judgments has been able to prove the issue of passing off of goods by the defendant under the trademark 'GREEN DIAMOND'. Since the plaintiff and defendant are in the trade of identical products and the defendant was a dealer of plaintiff's goods, and as such was fully aware of plaintiff's prior use of the trademark and sale of the products under the trade name CS (COMM) 125/21 Page 29 of 34 Diamond Modular Pvt. Ltd.
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'DIAMOND', therefore, adoption of similar trademark by the defendant after making some addition and some alternation in the get-up etc., makes the impugned trademark 'GREEN DIAMOND" a fraudulent and dishonest adoption. It can be inferred from the facts that Defendant wants to encash on the reputation and goodwill of the Plaintiff, for illegal gains. General public, traders and consumers who were dealing with defendant for the products of plaintiff because of reputation of the Plaintiff and the quality of the goods sold under the trademark 'DIAMOND' might have continued and may continue to buy the products of the Defendant under the assumption that they emanate from the Plaintiff with a slightly changed trade name and get up. The plaintiff thus has been able to establish that the defendant with dishonest intention started using trademark 'GREEN DIAMOND' which is deceptively similar to the trade-mark 'DIAMOND' belonging to the plaintiff.
50. The plaintiff thus is entitled for an injunction against the defendant in respect of trade-mark 'GREEN DIAMOND' using which the defendant has attempted to pass off its goods as that of plaintiff. A decree of injunction therefore, is passed in favour of plaintiff and against defendant restraining the defendant from passing off its goods under the trade name/trade-mark 'GREEN DIAMOND'.
CS (COMM) 125/21 Page 30 of 34 Diamond Modular Pvt. Ltd.
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51. Issue No.3:-Whether the plaintiff has not come to the Court with clean hands and whether the facts of not disclosing other proceedings going on between the parties in other forums i.e. Recovery Suit filed by defendant at Meerut Court and Criminal complaint in Meerut Police Station are material ? OPD
52. The defendant has argued that plaintiff did not disclose that there were other proceedings pending between the parties in other forum and non disclosure of particular should be considered as concealment of facts and intention of the plaintiff. It was argued that suit should be dismissed on account of concealment of material particulars.
53. The courts have held time and again that the facts which are material and important for just disposal of a case are to be necessarily pleaded by a party in whose knowledge they are. The fact, however, is that it is material facts and not all facts, suppression of which can be considered as material for the purpose of concluding that there was an unjust suppression. Defendant claims that there were recovery suits pending between the parties in Meerut Court. The defendant had filed recovery suit and criminal complaint against the plaintiff, which the plaintiff did not disclose before the court. The defendant itself has not disclosed if the recovery suit was with respect to trademark in dispute in this case or not and that when was the suit/complaint filed. In fact, no copy of said complaint CS (COMM) 125/21 Page 31 of 34 Diamond Modular Pvt. Ltd.
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or application has been placed on record either. Had the filing of complaint/suit by the defendant been very relevant for the purposes of disposal of this case, the defendant himself would have filed the same before this court to let this court form an opinion about the relevance of those proceedings to the facts of this case. Non mentioning of the fact that there were cases pending between the parties unrelated to the dispute of trademark at the time of filing of the suit, which cases have not been shown to be related to "challenge of trade-mark" in this case in any manner, does not affects the merits of the case. The issue is, therefore, decided against the defendant and in favour of the plaintiff.
54. Issue No5:- Whether the plaintiff is entitled to the relief of rendition of accounts? OPP
55. Issue no.1 & 4 have been decided in favour of plaintiff holding that defendant was wrong in using trademark 'GREEN DIAMOND'. It is defendants own case that it was using trade mark 'GREEN DIAMOND'. The defendant has also filed several invoices in support of its claim of having sold the goods using aforesaid trademark. He has also given sale figures for the year 2020 & 2021 in support of its claim. These documents, however, are not sufficient to conclude the amount of profit earned by defendant.
CS (COMM) 125/21 Page 32 of 34 Diamond Modular Pvt. Ltd.
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56. The plaintiff is thus entitled for decree of rendition of account in respect of profits earned by defendant from 2020, when the defendant says in cross-examination it started using the trade-mark 'GREEN DIAMOND' till the date of grant of injunction by the court i.e 20.03.2021.
A preliminary decree therefore, is passed in favour of plaintiff and against the defendant directing the plaintiff to furnish the statement of account in respect of profits earned by it from the sale of goods with trade-mark 'Green Diamond' during the aforementioned period.
57. Issue No.6:- Whether the plaintiff is entitled to costs? OPP
58. The present suit was filed on 19.03.2021. Plaintiff shall also be entitled to costs. In the circumstances noted above, pleader's fee and litigation expenses are assessed as Rs.40,000/- and Court fee deposited by the plaintiff is Rs.6,500/- This Court finds that plaintiff is entitled to total costs of Rs.46,500/-.
59. Issue No.7:- Relief. The plaintiff has been able to prove its case against the defendant. The defendant is hereby restrained from using trade-mark 'GREEN DIAMOND' in respect of any goods falling under the categories 9 & 11. The defendant is also directed to file its statement of account showing the profit earned by it from the date of adoption of trade-mark 'GREEN DIAMOND' till the date of grant of injunction by the CS (COMM) 125/21 Page 33 of 34 Diamond Modular Pvt. Ltd.
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court, generated by it using the trade-mark 'GREEN DIAMOND'. The cost is also awarded in favour of plaintiff as detailed while deciding issue no.6. Decree sheet be drawn up accordingly. File be consigned to record room.
(ANURADHA SHUKLA BHARDWAJ) District Judge(Commercial Court)-02 South, Saket, Delhi.
Announced in open court on 09.07.2024 CS (COMM) 125/21 Page 34 of 34 Diamond Modular Pvt. Ltd.
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