Delhi High Court
Pioneer Nuts & Bolts Pvt. Ltd. vs M/S Goodwill Enterprises on 11 September, 2009
Author: S. Muralidhar
Bench: Chief Justice, S.Muralidhar
THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 11.09.2009
FAO (OS) 334/2008
PIONEER NUTS AND BOLTS PVT. LTD ..... Appellant
Through: Mr. N.K. Kaul, Sr. Adv. with
Mr. Sanjeev Singh, Mr. Amit Kumar Singh,
Ms. Shikha, Mr.Karan Mehta, Mr. Amit Jha,
Advocates
versus
M/s.GOODWILL ENTERPRISES ..... Respondent
Through: Mr. Shailen Bhatia,
Ms. Anita Kapur & Mr. Amit Jain, Advs.
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE DR. JUSTICE S.MURALIDHAR
1. Whether Reporters of the local newspapers may be allowed
to see the judgment? No
2. Whether to be referred to the Reporter or not? Yes
3. Whether the judgment should be reported in the Digest? Yes
JUDGMENT
S. Muralidhar, J.
1.This appeal is directed against the impugned judgment and order dated 25 th April, 2008 passed by the learned single Judge rejecting I.A. No. 780/2007 filed by the appellant seeking an ad interim injunction against the Defendant infringing and passing off its registered trademark „TUFF‟ and „TUFF LABEL‟.
2. The parties are referred to by their status in the suit, i.e. the Appellant is referred to as the Plaintiff and the Respondent as the Defendant. FAO (OS) 334/2008 Page 1 of 22
3. The Plaintiff states that it adopted the trademarks „TUFF‟ and „TUFF LABEL‟ on 1st June 1996 in relation to nuts, bolts, screws and studs. Its application for registration of the mark „TUFF‟ in Class-6 goods was made on 11th February 1998, advertized in the Trademarks Journal No. MEGA-1 on 25th August, 2003 and Registration (under No. 791109) was granted in respect of the mark „TUFF‟ on 14th May, 2004 effective 11th February 1998. The Plaintiff‟s application for registration of the mark „TUFF LABEL‟ was advertised in the Trade Marks Journal No. 1328 Suppl. (5) dated 30th March 2005 and granted registration (under No. 1073841) in Class 6 goods on 19 th September 2005 effective 15th January 2002. The Plaintiff asserts that it is the owner and the proprietor in the artistic features in TUFF LABEL. The Plaintiff states that its copyright in TUFF LABEL is registered under the Copyright Act 1957 under A-74315/2005. The Plaintiff claims that it has been honestly and bonafide using the marks continuously in the course of trade since their adoption.
4. According to the Plaintiff, the goods manufactured by it have been accredited with ISO 9001:2000 certification by the TUV South Asia Private Limited. The Plaintiff claims to have acquired and built up its reputation and goodwill in relation to the products on which the marks are used. It advertizes its products through an exclusive website www.tuffbolt.com. It claims that its goods maintain the highest level of quality and precision. It states that it has spent a substantial amount on publicity and that its marks have acquired secondary significance denoting the said goods and business of the Plaintiff. It is asserted that the marks „TUFF‟ and „TUFF LABEL‟ FAO (OS) 334/2008 Page 2 of 22 have become distinctive and well known trademarks within the meaning of Sections 2(1)(zg) and 11 of the Trade Marks Act, 1999 („TM Act‟) in relation to the said goods and business.
5. The Defendant is stated to have adopted an identical/deceptively similar trade mark „TUFF LABEL‟ and „TUFF & TUFF‟ in relation to screws (self taping). A copy of the impugned mark adopted by the Defendant is placed on record. It is averred that the Defendant‟s marks are identical to and deceptively similar in each and every respect: i.e, phonetically, visually, structurally and in the basic idea and essential features. It is alleged that by adopting the impugned mark, the Defendant had infringed and passed off the Plaintiff‟s proprietary rights in the marks.
6. The Plaintiff has placed on record copies of the Defendant‟s applications advertised in the Trade Marks Journal. The first is application No. 1301515 dated 10th August, 2004 by Hereet Singh trading as Goodwill Enterprises for the mark „TUFF‟ in respect of "Screws (Self Tapping)" advertised in the Trade Mark Journal No. 1331 dated 1st June, 2005. In the column „proposed to be used‟, it is indicated: "(DELHI)". There is an additional representation dated 31st January 2007 made by Harpreet Singh in this application for registration of the mark in Class 12 goods claiming user since 1991. The second is application No. 9427887 dated 27th July 2000 by Harpreet Singh, Hardev Singh and Kushwant Singh trading as Good Will Industries claiming user since 1st April 1995 in respect of the mark TUFF for Screw (Self Tapping) published in the Trade Marks Journal No. 1345 dated 1st June FAO (OS) 334/2008 Page 3 of 22 2006. It is stated in the advertisement that the application is to be associated with Application No. 1030155. The third is an application No. 1302920 dated 16th August 2004 by Harpreet Singh trading as Goodwill Enterprises published in the Trade Mark Journal No. 1351 dated 1st September 2006 for an identical mark „TUFF‟ in respect of „Screws (Self Tapping)‟ in which the user is claimed from 1st January 1991. The fourth is application No. 1307257 dated 6th September 2004 by Hereet Singh trading as Goodwill Enterprises published in the Trade Marks Journal No. 1361 dated 1st February 2007 for the mark TUFF for "Self Tapping Screws included in Class 6" and which claims user since 31st December 1991 in Delhi. The fifth is application No. 1365632 dated 21st June 2005 by Harpreet Singh in respect of the mark TUFF for "all types of screws" with user claimed since 17 th June 2005 and published in the Trade Marks Journal No. 1338 Suppl. dated 15 th January 2006. The depiction of the label bearing the mark TUFF in each of the applications referred to is identical.
7. It is stated that the Plaintiff became aware of the Defendant‟s impugned adoption of the trade mark „TUFF LABEL‟ in respect of same class of goods through the aforementioned advertisements in the Trade Marks Journal. It lodged a Notice of Opposition against the Defendant‟s trade mark application No. 1301515. The enquiry in the trade by the Plaintiff revealed that the Defendant had not yet commenced using the impugned trade mark in relation to the impugned goods and, therefore, the Plaintiff had not been able to lay its hands on the impugned goods with the impugned trade mark „TUFF LABEL‟. The Defendant sent a letter dated 7.12.2006 to FAO (OS) 334/2008 Page 4 of 22 the Plaintiff requesting it to change the trade mark „TUFF‟ claiming that the Defendant was engaged in the business of manufacturing of fasteners under the trade mark „TUFF and TUFF‟ whereas in the trade mark application, the Defendant had filed one label depicting the trade mark „TUFF LABEL‟. In its letter dated 7.12.2006, the Defendant claimed to be a partnership concern.
8. It was averred by the Plaintiff that the adoption by the Defendant of the impugned trade mark was dishonest and fraudulent and since it was in the same line of business and for similar goods, the Defendant was taking advantage and trading upon the reputation and goodwill of the Plaintiff with a view to causing confusion and deception in the market and passing off its goods and business as those of the Plaintiff. On the above averments, permanent injunction was sought by the Plaintiff to restrain the Defendant from manufacturing, selling, advertising or displaying directly or indirectly the fasteners, screws, screws (self taping) nuts, bolts, studs and all allied and cognate goods falling in class-6 as well as class-12 or any other class of goods under the impugned trade mark „TUFF LABEL‟ and „TUFF and TUFF‟. The other prayer was for injuncting the Defendant from violating Plaintiff‟s copyright involved in the trade mark/label and order for delivering up of the impugned goods and business bearing the impugned trade mark and label including packaging, stickers, boxes and any other incriminating material including display boards and sign boards. A further prayer was for rendition of accounts and an order for decree of damages in the sum of Rs.20,00,500/-.
FAO (OS) 334/2008 Page 5 of 22
9. By order dated 22.1.2007, the learned single Judge passed an ex parte order restraining the Defendant from using, marketing, selling, offering for sale, advertising or displaying the trademarks or labels of the Plaintiff in respect of fasteners, screws, screws (self taping) nuts, bolts, studs and all allied and cognate goods till further orders. In the written statement, it was pointed out that Harpreet Singh is a partner of M/s Goodwill Enterprises and his mother Mrs. Rajinder Kaur had originally floated another firm M/s Goodwill Fasteners which had dealt in self taping screws. That firm had adopted the trade mark „TUFF‟ for self taping screws in the year 1991. It is claimed that the firm had advertized the trade mark „TUFF‟ in „The Hindu‟ on 26.12.1993. It was also advertized in Gujarat Samachar on 26.12.1993. The Post Office granted the Grams „TUFF‟ on 27.8.1994 to M/s Goodwill Fasteners. The firm was, however, closed on 31.3.1996. It is stated that Harpreet Singh formed another partnership firm with his brother Shri Kushwant Singh and father S. Hardev Singh under the name of M/s Goodwill Industries in 1994. M/s Goodwill Industries started using the trade mark „TUFF‟ in the year 1995. In the year 2002, Harpreet Singh formed another firm with himself, his mother Smt. Rajinder Kaur, cousin Gurpreet Singh and brother Kushwant Singh which was named M/s. Goodwill Enterprises, i.e. the Defendant herein. Since 2003, M/s Goodwill Enterprises has been using trade mark „TUFF‟. Thus, it is clear that the family of S. Harpreet Singh had been doing business under the trade mark „TUFF‟ in one or other firm since 1991 and that the firms Goodwill Fasteners and Goodwill Industries are the predecessors in interest of the Defendant Goodwill Enterprises. S. Harpreet Singh was a common partner in all these firms.
FAO (OS) 334/2008 Page 6 of 22
10. In order to show continuity of the use of the trade mark „TUFF‟ by the family of S. Harpreet Singh, the Defendant has placed on record the price lists, letters from dealers, trade enquiries and renewal of telegraphic address „TUFF‟ etc. Reference was also made to the advertisement taken out by M/s Goodwill Industries of the trade mark „TUFF‟ in 1999 in Rajasthan Patrika. The Defendant claims to be within its right to use the trade mark „TUFF‟ and questions the locus of the Plaintiff to file the suit. It is alleged that the Plaintiff was aware of the prior use of the trade mark „TUFF‟ by the Defendant and, therefore, did not reply to the letter dated 9.12.2006 written by the Defendant to the Plaintiff. It is pointed out that the Plaintiff really never called upon the Defendant to stop the use of the trade mark „TUFF‟ at any stage. Therefore, the Plaintiff was estopped from seeking an injunction to prevent the Defendant from using the said mark. It is stated that although in the Application No.1301515 in class-12, the Defendant had stated that it was proposing to use the mark, this was in fact an error since the mark was already being used since 1991. It is submitted that a wrong advertisement cannot change the factual averments. It is further contended that the registrations granted in favour of the Plaintiff are later to the adoption of the trade mark by the Defendant. It is further submitted that the Plaintiff‟s registration No.1073841 in class 6 is of a device of bolt, whereas the Defendant was not using the device of bolt. It is not in dispute that in addition to the documents filed along with the plaint, during the course of hearing, learned counsel of the Plaintiff placed reliance on the additional documents in the form of sales tax registration certificates of 1996, sales and income tax returns from 1996 onwards and excise registration certificate. FAO (OS) 334/2008 Page 7 of 22
11. The learned Single Judge noted that injunction should ordinarily follow the infringement of a registered trade mark, subject to two exceptions contained in the TM Act. The first exception being Section 28 which was to the effect that if both the Plaintiff and the Defendant are owners of registered trademarks, an action for infringement will not follow and only a passing off action can be maintained. The other exception was Section 34 which mandated that the proprietor of a registered mark cannot restrain the use of an identical mark by any person in relation to goods or which that person or predecessor in title had been continuously using from a date prior to the use of the first mentioned trade mark in relation to those goods by the proprietor or predecessor in title. The learned single Judge found that the two trademarks used by the parties were identical. While the Plaintiff used it for nuts, bolts, screws and studs, the Defendant used it for one kind of screw. It was held that the pictorial representation of the mark is closely identical in both cases.
12. The question was whether the Defendant had made out a case for prior use. The learned Single Judge noted that trade mark registration was given to the Plaintiff in 2005 with effect from 1998 and 2002. Copyright registration was obtained in 2005. Although the earliest use of the disputed mark was claimed by the Plaintiff to be 1996, the invoices and bills produced were of the years 2004 onwards. The income tax and sales tax returns from 1996 onwards mentioned the Plaintiff‟s income and sales but not its products. On the other hand, the Defendant had been able to show three advertisements, two of 26.12.1993 and one of 1999, trade enquiries of 1993, 1994 and 1995 and different invoices pertaining to Calcutta and Madras. The Plaintiff‟s FAO (OS) 334/2008 Page 8 of 22 case was that the Defendant was a squatter and merely advertising the mark but never using it. Referring to the judgment in Revlon Inc. v. Sarita Manufacturing Company AIR 1998 Delhi 38, it was held by the learned single Judge that the dissemination of knowledge of a trade mark in respect of a product through advertisement in media amounts to use of the trade mark whether or not the advertisement is coupled with the actual existence of the product in the market. The learned single Judge negatived the argument of the Plaintiff about the advertisements produced by the Defendant amounting to no credible evidence of user.
13. The other issue was of prior user. The learned single Judge relied on the copies of the partnership deeds where Harpreet Singh was shown as partner of the firm from 1991 in relation to the business and the product. Reliance was placed on the judgment in Swaran Singh v. Usha Industries (India), AIR 1986 Del 343 and Mocolube India Ltd. v. Maggon Auto Centre, 2008 (36) PTC 231 (Delhi) to hold that the Plaintiff has been able to establish prima facie existence of registration in its favour, in relation to the subject marks, with effect from 1998 and 2002. Yet there was no credible evidence of proof of the use of the mark from that period; the materials were sketchy. It was held that the Plaintiff had not produced any material to show that it had used the mark prior to 1998. On the other hand, the Defendant has "prima facie shown that the mark was advertized in 1993 and 1999 and trade enquiries through original letters, indents, etc. existed in 1993, 1994, 1995 onwards". The issuance of telegraphic name „TUFF‟ by the Postal Department in 1994, 1995 was also noticed and it was held that the FAO (OS) 334/2008 Page 9 of 22 Defendant was "prima facie continuously using the marks since 1993 at least, enabling it to the benefit of Section 34 of the Act." Accordingly the injunction was refused.
14. We have heard the submissions of Mr. Neeraj Kishan Kaul, leaned Senior counsel for the appellant and Mr. Shailen Bhatia, learned counsel for the Defendant. It is pointed out by Mr.Kaul that the Plaintiff had placed on record bills showing user of the mark since 1996. The Defendant had merely inserted two advertisements soliciting dealer enquiries. The mere obtaining of a telegraphic address for a couple of years did not amount to user of the mark. In any event, this was not a continuous user of the mark since there was no document produced by the Defendant after 1995 except a telegraphic address registration in 1997, a single newspaper advertisement in 1999 and in any event, the absence of any document of user from 1999 till date, the unregistered partnership deed of three different firms which by themselves never mention the impugned trade mark „TUFF‟ could not be relied upon. Moreover, without any valid deed assigning the impugned trade mark by one firm to the other, it could not be said that the Defendant was continuously using the mark.
15. On the other hand, Mr. Bhatia relies on Section 34 of the TM Act to contend that the Defendant was using the mark even prior to 1998. He relies upon the newspaper advertisements issued by the Defendant in 1993, the allotment to it of the telegraphic address „TUFF‟ in 1994, 1995, 1997, the partnership deeds and the receipt by it of trade enquiries. Copies of the FAO (OS) 334/2008 Page 10 of 22 indents of the Defendant‟s distributors mentioning the word „TUFF‟, the price lists of the Defendant mentioning the word „TUFF‟ and the trade mark applications filed in 1991 are all relied upon to show prior user. It is submitted that user later to 1998 is irrelevant because the law requires that the Defendant to show user prior to the date of grant of registration of the trade mark in favour of the Plaintiff.
16. Relying upon Section 2(2) (c) of the TM Act, as interpreted in Hardie Trading Ltd. & Anr. v. Addisons Paint and Chemicals Limited, (2003) 11 SCC 92, it is submitted by Mr.Bhatia that the advertisements issued by the Defendant in the newspapers prior to 1998 constitutes prior user. Reliance is placed on Wander Ltd. & Anr. v. Antox India (P) Ltd., 1991 PTC 1 (SC) to contend that need for protection of registered trade mark must be weighed against the corresponding need of the Defendant to be protected against the injury resulting from his being prevented from exercising his legal rights for which he cannot be adequately compensated. It is asserted that the Defendant has honesty of adoption.
17. Before the contentions of the parties are discussed, this court would briefly recapitulate the law. In Smith Bartlet and Co. v. The British Pure Oil Grease and Carbide Co. Ltd., (1934) 51 RPC 157, a distinction was drawn between the standard of proof of continuous prior user of an unregistered trade mark as required in an infringement action and that required in a rectification proceeding. The standard requited to defeat an infringement action was more stringent and rigorous. It was observed that FAO (OS) 334/2008 Page 11 of 22 Section 41 of the Trade Marks Act of the United Kingdom (which required like Section 34 TM Act continuous prior user) had put "the owner of a registered Trade Mark in a very exceptional position, whether he has used the mark or not, and he is entitled to the exclusive user of it unless under the proviso to Section 41 somebody else is able to show, not an occasional user from a date anterior to the user by the owner of the registered trade mark, but a continuous user by him."
18. In Amaravathi Enterprises v. Karaikudi Chettinadu, 2008 (36) PTC 688 (Madras) (DB), it was observed that apart from prior continuous use of the trade mark and trade name, the Defendant seeking to set up a defence of prior use under Section 34 of the TM Act had to also prove the volume of sales. In Veerumal Praveen Kumar v. Needle Industries (India) Pvt. Ltd., 2001 (21) PTC PTC 889 (Delhi), a Division Bench of this Court emphasized that a trade mark does not arise from the mere use of a word or words or a formula or a mark. It had to be shown that in relation to particular goods, there is a course of trading and that a goodwill connecting the trader with the goods by the reason of the trade mark under which the goods are marketed has resulted. It was observed: "it follows that where, in relation to particular goods, there is no such course of trading as to give rise to goodwill, there is no interest to be protected by a trademark and no such mark can subsist in vacuo."
19. In Revue Trade Mark (1979) RPC 27, the question was whether there had been use of the trade mark within the meaning of Section 26 of the Trade Mark Act of the United Kingdom. It was observed that mere offers FAO (OS) 334/2008 Page 12 of 22 for sale and orders resulting from such offers do not constitute the use of a trade mark. It was necessary that the proprietor of the trade mark, by the time an offer for sale is published, should "take positive steps to acquire goods marked with the trade mark" for then he would have done enough for his combined actions to constitute use on, or in relation to goods. These observations were approved by the learned single Judge of the Calcutta High Court in Kabushiki Kaisha Toshiba (Toshiba Corporation) v. Toshiba Appliances Co. 1994 (14) PTC 53 (Cal), where a reference was made to the observations of Falconer, J. in Hermes Societe Anonyme v. B.H. Ries Ltd., 1982 RPC 425. It was observed in the latter case that the issuance of a series of advertisements as part of an introductory campaign may be use of the mark in the course of trade but "not upon the goods or in physical relation thereto". It was observed that this exposition of the law would equally be applicable in India. This part of the judgment of the learned Single Judge was not been disturbed by the Division Bench of the Calcutta High Court and later by the Supreme Court in Kabushiki Kaisha Toshiba v. Toshiba Appliances, (2008) 37 PTC (SC). Likewise in Harold Radford, (1951) 68 RPC 221, it was held that the mere issuance of an advertisement would not constitute a user of the mark. It was observed that otherwise the proprietor of a trade mark might, without having any goods to offer, advertise its marks at periodical intervals and thereby prevent any attack being made upon the mark. It was emphasized that "use of a mark in advertising media must be concurrent with the placing of the goods in the market if it is to be regarded as a trade mark".
FAO (OS) 334/2008 Page 13 of 22
20. This interpretation of law equally applies as far as TM Act is concerned. The definition of „trade mark‟ even under Section 2(1)(zb) of the 1999 Act means a mark "which is capable of distinguishing the goods or services of one person from those of others". Therefore, the use of a mark that is not capable of distinguishing the goods of such proprietor of the trade mark would not qualify for the protection under the TM Act.
21. The reference in the impugned judgment of the learned Single Judge to Revlon Inc. case (supra) was not apposite. It was observed in the said case that dissemination from the knowledge of a trade mark in respect of a product through advertisement in media amounts to use of the trade mark whether or not the advertisement is coupled with the actual existence of the product in the market. However, the facts of that case show that the Plaintiff was the registered owner of the trade mark and its goods did exist abroad. The goods being perfumes under the mark Revlon, Charlie, Intimate etc. had a proven trans-border reputation. The non-existence of goods in India was owing to special circumstances such as closed economy, import restrictions etc. It was observed in para 25 as under:
"Though the matter about rectification of the register of trade marks due to the Plaintiff‟s non-user for a continuous period of five years is pending before the Calcutta High Court and I am not giving any finding on the same, however, on the basis of material placed on record, I am prima-facie of the opinion that the products of the Plaintiffs were available in India even at that time at the duty free shops and they were also being imported and sold to diplomats."
22. The learned Single Judge appears to have followed the judgment of the FAO (OS) 334/2008 Page 14 of 22 Division Bench in N.R. Dongre v. Whirlpool Corporation AIR 1995 Delhi
300. Although it was observed therein that dissemination of knowledge of a trade mark in respect of a product through advertisement in media amounts to use of the trade mark whether or not the advertisement is coupled with the actual existence of the product in the market, that case was essentially about trans-border reputation. One of the issues that arose for determination there was "whether the reputation of trademark whirlpool in respect of washing machines of the respondent has travelled trans border to India." On the material before the Court, the learned single Judge came to the conclusion that Whirlpool Corporation had "positively made out a case of actual sales by it of Whirlpool products including washing machines in a proved geographical region around the world." The sales in India were limited to the US Embassy and US Aid Office, New Delhi. It was in those circumstances that reliance was placed on the advertisements in the country for dissemination of knowledge about the trade mark. Therefore, the said case was not about mere advertisements but advertisements coupled with the availability of goods even outside India. The whole case proceeded upon the extra territorial reputation of a mark since the product was in any way available outside India. The said decision shows that the knowledge and the awareness of foreign goods and its trade mark can be even at a place where the goods are not being marketed and used. The observations in Whirlpool cannot therefore possibly apply to the facts of the instant case.
23. Turning to the case on hand, the Defendant has been unable to show that its goods bearing the mark TUFF were at any point of time since 1991 and prior to 1996 available in the market. There is absolutely no evidence placed FAO (OS) 334/2008 Page 15 of 22 on record by the Defendant to show that it has actually sold its goods using the mark „TUFF‟ or „TUFF & TUFF‟ even thereafter. For proving prior user, the Defendant repeatedly referred to the two newspaper advertisements inserted by it in 1993, the six trade enquiries between 1994 and 1995 emanating from these advertisements. Between 1993 and 1995, there were seven indents of John and John Traders and one indent of Bolt House. There is also a letter from John and John Traders asking the Defendant to send goods from outside. Then we have the grant by the Postal Department of the telegraphic address „TUFF‟ to the Defendant.
24. In light of the law as explained in the aforementioned decisions as applied to the facts of the present case, the advertisements issued in the newspapers can hardly constitute the proof of service on the user of the mark from those dates. Likewise, the grant of a telegraphic address, or the soliciting of business, or the receipt of trade enquiries cannot by themselves satisfy the legal requirement of the defendant having to show that it used the marks, earlier than the Plaintiff did, in relation to goods.
25. As regards the filing of trade mark applications, the unilateral self- serving declaration by the Defendant in some of them of user since 1991 cannot constitute evidence of the commencement of use from that date. The opposition to the Defendant‟s applications has still not been disposed of and no registration as such has been granted to the Defendant. Therefore, this does not carry the case of the Defendant any further. In any event the claims of user made in the applications by the Defendant have been inconsistent. In FAO (OS) 334/2008 Page 16 of 22 the application No. 942787 filed on 27.7.2000, user was claimed since 1.4.1995. In application No. 1301515 filed on 10.8.2004, it was stated "proposed to be used". In application No. 1302920 filed on 16.8.2004, the user was claimed since 1.1.1991 and in application No. 1365632 filed on 21.6.2005, the user was claimed since 17.6.2005. These inconsistent positions taken by the Defendant creates more difficulties for it about the claim of prior user.
26. Then we have the photocopies of the partnership deeds executed on 20.12.1991. The deeds stipulate that the business of partnership will be carried out under the name of Goodwill Fasteners. Nothing is shown as to how the firm adopted the trade mark „TUFF‟ which according to the Defendant began to be used by it from 1.1.1991 itself, the date on which the said firm was not in existence. The partnership deeds themselves are unregistered. The deeds do not mention the impugned trade mark „TUFF‟. There is no deed of assignment by which the mark has been assigned to the Defendant M/s Goodwill Enterprises. Therefore, these documents do not really advance the case of the Defendant about the use of the trade mark „TUFF‟ even prior to the date on which the Plaintiff claims its user, i.e. 1998.
27. It needs to be noted that in the present appeal, counsel for the Defendant sought to place on record for the first time certain additional documents. It was claimed that the Defendant had lost crucial documents in 1998 as one of the partners who was carrying them in a scooter fell down while riding it. A FAO (OS) 334/2008 Page 17 of 22 copy of the purported police complaint dated 3.3.1998 that had been lodged in that regard was sought to be produced. The Defendant also sought to produce copies of income tax returns, sales tax assessments and certain other documents showing sales made by it. When asked whether the originals of these additional documents sought to be filed could be produced, the counsel for the Defendant replied in the negative. Be that as it may, this court refused to permit the additional documents to be placed on record by the Defendant for the first time at the appellate stage with no convincing explanation why they could not be produced earlier. In any event the police complaint would only show that certain documents were lost in 1998. There was no explanation why documents pertaining to sales by the Defendants of goods with the mark TUFF for the years thereafter were not produced.
28. As regards the documents produced by the Plaintiff in the instant case, at pages 223 to 290, copies of the bills and invoices of the Plaintiff from 1996 to 2006 have been placed. Invoices of the Plaintiff showing sale of „TUFF Bolts‟ dated 3.10.1996, 20.11.1996, 18.12.1996, 3.3.1997, 18.4.1997 and 11.6.1997 have been placed on record. It clearly shows that the Plaintiff has been trading in goods with the mark TUFF during this time. The Defendant however alleges that the word TUFF on some of these invoices is a later interpolation and therefore these documents are forged. Suffice it to note that at this stage, that the Plaintiff has made out a prima facie case of use of the marks on its goods since 1996 whereas the Defendant has not produced any documentation to show that it has traded in goods bearing the impugned mark TUFF since 1991 as claimed or in any event on a date prior to the FAO (OS) 334/2008 Page 18 of 22 Plaintiff‟s use of the mark. The question of proof of the invoices produced by the Plaintiff will have to await the full fledged trial.
29. The decisions cited by the learned counsel for the Defendant are now discussed. In Kabushiki Kaisha Toshiba (Toshiba Corporation) v. Toshiba Appliances Co. the advertisements in question were coupled with the fact of maintenance of service centers in India for the product imported into India. Therefore, it was not as if the mark was not used in relation to goods which were available in India. Hardie Trading Ltd. v. Addisons Paint and Chemicals Limited (supra) was a case of rectification and the question of prior continuous user under Section 34 of the Act was not in issue. It was alleged that there had been no use of the mark between 1972 and 1977. It was, however, shown that the registered proprietor had taken steps during this period to enter into an agreement with another marketer to keep the mark alive. The mark of the registered proprietor was also continuously in use in England and Australia. In those circumstances, it was held that there was no intention to abandon the registered mark. The question there was not whether the issuance of an advertisement could itself constitute the use of a mark. Secondly it is really in the context of rectification proceedings that the Supreme Court held that there had been no abandoning of the mark despite goods not being available in India. It did not dispense with the requirement of proving continuous prior user of the mark. Thirdly, the requirement of Section 2 (2) (c) of the 1958 Act was also that the goods must come into existence at some point in time. In the considered view of FAO (OS) 334/2008 Page 19 of 22 this Court, therefore, the judgment in Hardie Trading Ltd. does not help the case of the Defendant.
30. The decision in Wander Ltd. & Anr. v. Antox India (P) Ltd. also does not help the Defendant. That was a case of passing off and not infringement. Consequently, there was no occasion for the Supreme Court to interpret Section 34 of the TM Act. In any event, in the said case, the Plaintiff had been manufacturing the goods under an agreement with the Defendant. The Defendant had been using the trade mark and had got it registered before entering into an agreement with the Plaintiff. The agreement was rescinded and thereafter the Plaintiff filed a suit against the Defendant on the basis of continuous prior user. It was held that the Plaintiff was not entitled to injunction as the balance of convenience was not in the Plaintiff‟s favour. To that extent, the said judgment in fact would be in favour of the Plaintiff here, since the Defendant here has not been able to prove continuous prior user.
31. Milment Oftho Industries v. Allergan Inc. 2004 (28) PTC 585 (SC), was again a case of trans-border reputation. In para 9 of the said judgment, it was observed that mere filing of an application for registration of a brand will not enable one to throttle Indian companies from adopting the use of their brands. Uniply Industries v. Unicorn Plywood, AIR 2001 SC 2083, was a case of passing off where Section 34 was not being interpreted. Apart from advertisements, the trial court had found that the Defendant was using the trade mark for roller printing/screen printing on the board itself and, therefore, granted the injunction in favour of the Defendant. The Supreme FAO (OS) 334/2008 Page 20 of 22 Court noted that it was not clear whether the advertisement was followed up by goods with the mark being marketed and noted that the courts should have been more cautious in granting an injunction.
32. In view of the documents produced on record as noticed hereinbefore, it is held that the Defendant has been unable to show at the interlocutory stage that its use of the impugned marks, which stand registered in the name of the Plaintiff, is prior to the use of those marks by the Plaintiff. On the other hand, the Plaintiff has been able to make out a prima facie case for the grant of an ad interim injunction.
33. On the question of balance of convenience, the Defendant has not shown that it is trading in goods using the mark „TUFF‟. The grant of an interim injunction in favour of the Plaintiff is therefore not likely to affect the sales of the Defendant. On the other hand the refusal of an interim injunction would adversely affect the Plaintiff. The balance of convenience in granting interim injunction as prayed for is in favour of the Plaintiff.
34. For all the above reasons, the impugned judgment of the learned single Judge is set aside. An interim injunction is granted in favour of the Plaintiff restraining the Defendant, its agents, assigns or representatives from offering for sale, selling, manufacturing, marketing, advertising or displaying directly or indirectly the goods using the mark „TUFF‟ or „TUFF LABEL‟ during the pendency of the suit. I.A. No. 780 of 2007 in CS (OS) No. 121 of 2007 FAO (OS) 334/2008 Page 21 of 22 filed under Order 39 Rules 1 and 2 CPC by the Plaintiff is disposed of by making the aforementioned interim injunction absolute during the pendency of the suit. Consequently, I.A. No. 2798 of 2007 filed by the Defendant under Order 39 Rule 4 CPC is hereby dismissed.
35. It is clarified that this order is at the interlocutory stage based on the pleadings and documents on record. The final decision based on the evidence that emerges at the trial will be on an independent assessment uninfluenced by this order.
36. The appeal is accordingly allowed in the above terms with costs of Rs.30,000/- which will be paid by the Defendant/Respondent to the Plaintiff/Appellant within a period of three weeks.
S. MURALIDHAR, J.
CHIEF JUSTICE SEPTEMBER 11, 2009 pk FAO (OS) 334/2008 Page 22 of 22