Delhi District Court
M/S Three-N-Products Pvt. Ltd vs M/S Pardesi General Store on 27 March, 2010
IN THE COURT OF SHRI HARISH DUDANI,
ADDITIONAL DISTRICT JUDGE-15 (CENTRAL) : DELHI
Suit No.106/08/00
1. M/s Three-N-Products Pvt. Ltd.
3030, Street No. 4, Ranjit Nagar,
New Delhi - 110 048
2. Shri Malinder Singh
trading as M/s Herbal House,
16-B, Adhartal Industrial Estate,
Jabalpur (M.P.) ............Plaintiffs
VERSUS
1. M/s Pardesi General Store
H-30, Mian Market,
Rajouri Garden,
New Delhi.
2. M/s The Himalaya Drug Company,
Makali,
Bangalore - 562 123 ......... Defendants
Date of Institution of Suit : 19.06.2000
Date of Decision : 27.03.2010
JUDGMENT
1. This is a suit filed under sections 105 and 106 of the Trade and Merchandise Marks Act, 1958 and section 55 of the Copyright Act, 1957 for relief of permanent injunction for passing off, infringement and rendition of accounts, etc. filed by the plaintiffs.
2. The plaintiffs have filed the abovenoted suit stating therein that the plaintiff No.1 is a Private Limited Company incorporated under the Indian Companies Act, 1956 and Shri Minminder Suit No. 106/08/00 1 Singh is one of the Directors of the company and as such is competent to institute, sign and verify the present suit. S. Manminder Singh is also fully competent and authorised by the Board of Directors and S. Malinder Singh is the sole proprietor of M/s. Herbal House and has authorised S. Manminder Singh by Power of Attorney for filing the present suit. It is stated that M/s. Three-N-Products was initially a partnership firm with three partners and they converted the partnership into Private Limited Company in which all the three above became the promoters and directors.
3. It is averred in the plaint that the plaintiff No.1 is manufacturer of cosmetics products including creams, skin care lotions, shampoos, hair care treatment material, tea and ayurvedic medicines like Ayur Margossa (Paste/lep), Ayur Dia-Slim, etc. The predecessor of the plaintiff No.1 on 01.04.1984 adopted the trade mark 'AYUR' in respect of cosmetic products, including cream, skin care lotions, shampoo, Hair care material and face pack kit in the year 1984 and the plaintiff No.1 extended the use to Ayurvedic medicines in the year 1995. The plaintiff is registered proprietor of the trade mark 'Ayur' for number of goods vide various trade marks under various classes i.e. trade mark Nos.421919, 504095, 548522, 536257- B, 536258-B & 536261 under class 3, 5, 16, 29, 30 and 33 respectively and apart from said trade marks, the plaintiff has filed an application for defensive registration of trade mark 'AYUR' under No.548521 which is pending with the Registrar of Trade Mark, Bombay. It is further stated that a number of applications of the plaintiff company for obtaining registration under the Trade & Merchandise Marks Act, 1958 for its number of goods are pending (as per details mentioned in para 5 from Suit No. 106/08/00 2 page No.3 to 9 of the plaint and for the sake of brevity the same are not being repeated herein).
4. It is further stated that the plaintiff No.1 is the owner of the artistic work titled 'AYUR' having a distinctive get-up, lay out, plan and lettering style and using said artistic work since the year 1984 and the same is an original artistic work and the plaintiff's said artistic work 'AYUR' is also registered under the provision of Copyright Act. It is stated that the plaintiff No.1 are the first adopters, originators, true owners and lawful proprietors of the trade mark/artistic work 'AYUR' used by them in respect of its various goods.
5. It is stated that the plaintiff No.1 has entered into an agreement with plaintiff No.2 to sell products under the mark 'AYUR' of plaintiff No.1 and the plaintiff No.2 is selling AYUR DIA-SLIM which is an Ayurvedic treatment (Dia Slim Tumblers) for reducing fat and weight and also controlling sugar and the said product is being sold since 1995 continuously.
6. It is stated that on account of superior quality of its said goods and due to continuous use of the trade mark/artistic work 'AYUR' for over 15 years the plaintiff's said trade mark/artistic work 'AYUR' in respect of various goods and since 1995 in respect of Ayurvedic treatment has acquired unique reputation and valuable goodwill in the eyes of the public and trade and in case person uses the trade mark 'AYUR' on any goods the purchasing public and trade world get confused and will be misled. It is stated that the plaintiffs have given wide publicity to its trade mark 'AYUR' through various advertising medias and goods sold under the trade mark 'AYUR' connote and denote Suit No. 106/08/00 3 the goods and merchandise of the plaintiff No.1 origin and none else. It is stated that the sales of various items including Ayur Dia-Slim by M/s Herbal House, Jabalpur has increased from Rs.3,25,000.00 in the year 1995-96 to Rs.80,54,337.00 in the year 1999-2000.
7. It is stated that the plaintiffs have come to know in the first week of June, 2000 that the defendant is manufacturing, selling and/or offering for sale medicines under the trade mark 'AYURSLIM CAPSULES' and claims that these capsules burns excess fat under the trade mark 'AYURSLIM'. The defendants are applying this trade mark and copyright on the capsules for burning excess fat and the defendants have also imitated the artistic work of the plaintiffs and the overall appearance, get-up, lay out and lettering style are identical with and/or deceptively similar to those of the plaintiffs' trade mark 'AYUR' and all the essential features of the plaintiffs' trade mark and copyright have been copied and imitated on the products manufactured and marketed by the defendants. The product of the defendant that is AYUR SLIM CAPSULE is equivalent to plaintiff's product AYUR DIA-SLIM as the purpose of goods of both the parties is same. Thus the likelihood of confusion is more and this is a case of triple identity. The trade mark is same, the purpose of the goods is same, the purchasers and intending purchasers are the same. It is stated that the trade mark 'AYURSLIM' of the defendants is identical with and/or deceptively similar to that of the plaintiffs trade mark and copyright 'AYUR' and 'AYUR DIA-SLIM' and as such the defendants are infringing the rights of the plaintiffs and the defendants have sold and passed off and have caused to be sold and passed off capsules under the trade mark 'AYUR SLIM' not manufactured and/or Suit No. 106/08/00 4 marketed by the plaintiffs as and for the goods of the plaintiffs and have thereby gained huge wrongful profits and loss to the plaintiffs. It is prayed that an order for permanent injunction restraining the defendants from infringing the trade mark 'AYUR' of the plaintiff or/and from using the trade mark 'AYUR' or any other trade mark which is identical with or deceptively similar to the plaintiffs trade mark 'AYUR' and to restrain the defendants from passing off their goods and business as and for the goods and business of the plaintiff under the trade mark 'AYUR SLIM' or any other trade mark in which AYUR is the essential part in respect of medicines and for rendition of accounts of profits illegally earned by the defendants alongwith cost.
8. Summons of the suit were issued to the defendants and both defendant appeared but later on defendant no.1 stopped appearing and accordingly vide order dated 20.04.2007, the case against the defendant no. 1 was proceeded ex-parte. The defendant No.2 has filed written statement and has contested the suit. In the written statement, the defendant No.2 has taken objections that the plaintiffs are allegedly the manufacturers of a wooden tumbler with the alleged trademark AYUR DIA-SLIM targeted at diabetics and are objecting to the use of the trademark AyurSlim by the defendant No.2 in relation to Ayurvedic medicinal preparations in capsule form targeted at people with problem relating to obesity and overweight and the product of the defendant No.2 is sold under the umbrella mark Ayurvedic CONCEPTS consisting of a range of Ayurvedic preparations that have gained immense reputation and popularity in India and abroad. It is stated that the plaintiffs have concealed the material fact that they do not Suit No. 106/08/00 5 even have a trade mark registration for the mark AYUR for the relevant class of goods that the defendant No.2 manufactures i.e. Ayurvedic medicinal preparations and have misled court through various falsehood, into believing that they do and as such plaintiffs are perpetuating a fraud on this court as they have no registered trade mark with respect to the article AYUR DIA-SLIM tumbler or in relation to Ayurvedic medicinal preparations and they are representing the AYUR mark on DIA-SLIM tumbler with an encircled R, indicating that it is registered in respect of that class of articles and they are representing that such articles are Ayurvedic medicinal preparations, while it is actually an unrelated agricultural/forestry product that falls within the ambit of Class 31, as such the plaintiffs have approached this court with unclean hands and the suit is liable to be dismissed. It is further stated that logo/artwork of defendant No.2's trademark bears no similarity in any respect, be it font, colour combination, script or visual appeal to the plaintiff's trade mark or packaging. It is stated that the plaintiffs hold no trademark registration in respect of Ayurvedic medicinal preparations, the present suit could at best be an action based on passing off and the trade mark AYUR DIA-SLIM and AyurSlim are not at all deceptively similar. It is stated that this product packaging under the umbrella trademark AYUR AYURVEDIC CONCEPTS is an integral, standard, consistent and uniform part of every product in the defendant No.2's product range and comparison of the competing products would clearly show that none of the essential parts or components are similar. It is stated that the plaintiffs' product is admittedly a tumbler fashioned out of wood, whereas the defendants No.2's product is an Ayurvedic preparation in the form of capsule. It is further stated that there Suit No. 106/08/00 6 is a significant price difference between the plaintiffs' and defendant No.2's products and packaging/trade dress of the two competing products is entirely different. It is also stated that two goods are targeted at two different classes of consumers, the plaintiffs' product being targeted at diabetics, while the defendant No.2's products are targeted to people having general overweight and obesity related problems and in addition to this the defendant No.2's product requires to be consumed internally, while the plaintiff's product is not consumed. There can therefore, be no scope for confusion and deception. It is also stated that the stark distinctions in the competing labels, apart, the word mark AYUR is a well known Hindi word, which in common parlance means health and life and that the compound word AYURVEDA is commonly understood to mean the traditional Indian science of health or medicine.
9. In the WS, the defendant no. 2 has denied that plaintiff No.1 is the first adopter, originator, true owner or lawful proprietor of the trade mark/artistic work AYUR in respect of any goods. The defendant no. 2 has denied that Mr. Maninder Singh is competent to sign, verify and institute the present proceedings on behalf of the plaintiffs. It is denied that the plaintiff No.1 has entered into any agreement with the plaintiff No.2 to sell product under the mark AYUR. It is stated that word AYUR denotes Ayurvedic preparations and is common to the trade and practiced by several entities engaged in the manufacture and sale of Ayurvedic preparations and the defendant No.2 ought not to be restrained from using such a common word, especially in the trade that it has been involved in for the past 70 years. The defendant No. 2 has denied that the mark AYUR Suit No. 106/08/00 7 is an invented mark. The defendant no.2 has denied that the plaintiffs have paid the proper court fee. The defendant while refuting rest of the allegations of the plaintiff has sought dismissal of the suit with cost.
10. The plaintiff has filed replication to the written statement of defendant No.2. In the replication, the plaintiff has reiterated the contents of plaint and has controverted the allegations of the defendant No.2 as alleged in the written statement.
11. From the pleadings of the parties, following issues were framed by my ld. Predecessor on 07.04.2005:-
1.Whether the suit is instituted by duly authorised person?OPP
2.Whether the plaintiff is the proprietor of trademark AYUR DIA-SLIM?OPP
3.Whether the plaintiff's registration in respect of trade mark AYUR DIA-SLIM covers the goods marketed by defendant No.2? If yes, its effect?OPParties
4.Whether the defendant No.2 is passing off its goods as those fo the plaintiff's?OPP
5.Whether the suit is properly valued for the purpose of Court fee?OPP
6.Whether the plaintiff is entitled for the decree for permanent injunction as prayed for? OPP
7.Whether the plaintiff is entitled for a decree for rendition of accounts?OPP.
8.Relief.
12. To prove its case, the plaintiffs examined Shri Manminder Singh as PW-1 and PE was closed on 26.09.2008.
Suit No. 106/08/00 813. In order to prove its defence, defendant No.2 produced Shri Vishal Nagar, its Zonal Manager for examination as DW-1. But only examination-in-chief of DW-1 was recorded and thereafter he did not appear for cross-examination, hence, his testimony is of no consequence.
14. I have heard the ld. Counsel for parties and carefully perused the record. My findings on the specific issues are as under :-
15. Issue No. 1In para 1 of the plaint, the plaintiffs have stated that plaintiff no. 1 is a private limited company and Shri Manminder Singh is one of the directors of the company and as such is competent to institute, sign and verify the present suit and he is also fully competent and authorised by the Board of Directors. It is further stated that Shri Malinder Singh is the sole proprietor of plaintiff no. 2 and he has authorised Manminder Singh by a power of attorney for filing the present suit. The plaintiffs have examined Shri Manminder Singh as PW-1 who adduced evidence by way of affidavit Ex.P-1/A. In para 1 of the affidavit Ex.P-1/A, PW-1 has stated that he is one of the directors of the plaintiff company and is duly competent and authorised by Board of Directors to depose on behalf of plaintiff no. 1 and he is also attorney of plaintiff no. 2. Although, in the plaint and in para 1 of the affidavit Ex.P-1/A, the plaintiff has stated that PW- 1 is one of the directors of plaintiff no. 1 and is competent and authorised by Board of Directors to depose on behalf of plaintiff no. 1 and he has been authorised by plaintiff no. 2 by power of attorney to file the present suit but the plaintiffs have not proved any document which would prove that Shri Manminder Singh is director of the plaintiff no. 1 and is competent to Suit No. 106/08/00 9 institute, sign and verify the suit and he has been authorised by any resolution of Board of Directors of plaintiff no. 1 to file the present suit. Plaintiffs have also not filed any power of attorney on record by virtue of which plaintiff no. 2 has authorised Shri Manminder Singh to institute the present suit.
16. Order 29 rule 1 CPC provides that in suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. The plea of the plaintiffs is that Shri Manminder Singh is the director of the plaintiff no. 1 and accordingly he is competent to sign and verify the pleadings and is able to depose to the facts of the case and he has signed and verified the pleadings but it is to be noted that plaintiff no. 1 has not proved Memorandum or Articles of Association or any other document on record which would prove that Shri Manminder Singh is one of the directors of the plaintiff no. 1. Moreover, the present suit has been signed, verified and instituted by Shri Manminder Singh on behalf of plaintiff no. 2 as power of attorney but no such power of attorney which has been allegedly executed by plaintiff no.2 in favour of Shri Manminder Singh has been filed on record. In Nibro Ltd. vs. National Insurance Co. Ltd., MANU/DE/0138/1991 it was held that Order 29 rule 1 CPC provides for subscription and verification of pleadings and states that in suits by or against the corporation, any pleadings may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. It was held :Suit No. 106/08/00 10
15. This court in Oberoi Hotels (India) Pvt. Ltd. (Suit No. 469 of 1966-26-1968), while dealing with the scope of Order 29 of the Code of Civil Procedure has observed as follows :
"Learned counsel for the plaintiff lastly argued that Shri Ram Lal Chaudhary had stated that he had authority to file the suit as a principal officer of the plaintiff company even apart from the resolution marked 'A'. He did not say so. But how does that help? The authority of a principal officer of a company in relation to suits filed on behalf of the limited company does not extend beyond what is laid down in Order 29 of the Code of Civil Procedure. That provision does not entitle the principal officer of a company to file a suit on its behalf and for that the authority has to be found either in the articles of association of the company or in the resolution of its board of directors. In the articles of association of several companies, provision is generally made authorising their managing directors and other officers to file and defend suits on their behalf. Similarly, the board of directors of a company can authorise the institution of a suit on behalf of the company by a resolution. In the case of some companies the articles empower the managing director or directors to appoint general attorneys and general managers and given them authority to institute suits on behalf of the company. But in the absence of any proof in regard to any such Suit No. 106/08/00 11 power having been conferred on Shri Ram Lal Choudhary, it is not possible to accept his statement that he was authorised to file the suit as the principal officer of the plaintiff hotel.
16. I, therefore, hold that although the plaint has been signed and verified by a person duly authorised to do so on behalf of the plaintiff company, it has not been proved that the suit has been instituted by any such person. The issue is consequently decided against the plaintiff.
17. Similarly, in South India Insurance Co. Ltd. (Suit No. 68 of 1969-19-4-1974), this court has dealt with a similar objection as raised by the defendant in this case and observed that a company being a corporate body or a juristic person has to act through somebody and that the person has to be specifically authorised to institute the suit. In Notified Area Committee, AIR 1935 Lah 345, the Lahore Bench considered the scope of Order 29, rule 1 of the code of Civil Procedure and it has been observed thus (at page 346) :
"Similarly, Order 29, rule 1, Civil Procedure Code, also does not help the appellant. It merely defines the person who is authorised to sign or verify the pleadings on behalf of the corporation (in this case the committee). It, therefore, comes into operation only after the Suit No. 106/08/00 12 proceedings have been validly started and cannot be utilised to authorise an unauthorised person to institute suits on behalf of the corporation."
18. In Seth Kirpal Chand v. Traders Bank Ltd. AIR 1954 J & K 45 the court, while dealing with the question that though there is no original authorisation, a subsequent ratification could render it legitimate, has approved the view taken by the Division Bench of the Lahore High Court in Notified Area Committee, AIR 1935 Lah 345 and observed thus (at page 47) :
"Here the initiative to institute the suit could be properly transferred to the manager under article 105 of the articles of association and, therefore, the subsequent ratification of the act of the agent by the principal could cure the original defect."
19. Thus, the Division Bench accepted the view that there should be a specific authorisation in favor of a person permitting him to institute a suit.
20. In University of Kashmir v. Ghulam Nabi Mir AIR 1978 (NOC) 114 (J & K), the court has observed that signing and verification of the plaint is different from filing the suit by a competent person.
Suit No. 106/08/00 1321. In the case of Food Corporation of India, MANU/PH/0120/1981, while considering the issue whether an application was filed by a competent person, the court has observed that Order 29, rule 1, does not empower an officer to conduct the case on behalf of the corporation. Only the limited power to sign and verify the pleadings has been conferred upon the officer.
27. On the analysis of the judgments, it is clear that Order 29, rule 1 of the Code of Civil Procedure does not authorise persons mentioned therein to institute suits on behalf of the corporation. It only authorises them to sign and verify the pleadings on behalf of the corporation.
29. .............................................It is true that ordinarily the court will not unsuit a person on account of technicalities. However, the question of authority to institute a suit on behalf of a company is not a technical matter. It has far- reaching effects. It often affects the policy and finances of the company. Thus, unless a power to institute a suit is specifically conferred on a particular director, he has no authority to institute a suit on behalf of the company.
Needless to say such a power can be conferred by the board of directors only by passing a resolution in that regard.
Chapter IV of the Delhi High Court (Original Suit No. 106/08/00 14 Side) Rules deals with the question of presentation of suits. Under this rule, a suit can be presented by a duly authorised agent or by an advocate duly appointed by him for the purpose. This authorisation, in my view, in the case of a company can be given only after a decision to institute a suit is taken by the board of directors of the company. The board of directors may in turn authorise a particular director, principal officer or the secretary to institute a suit.
17. The plaintiffs have not filed any resolution passed by plaintiff no. 1 authorising Shri Manminder Singh to institute the suit. Moreover, in his affidavit Ex.P-1/A also Shri Manminder Singh has stated that he has been authorised by Board of Directors of plaintiff no. 1 to depose in the case and the plaint has been signed and verified by him and he is also attorney of plaintiff no. 2 and the plaint has been signed on behalf of both the plaintiffs. In Ex.P-1/A also Shri Manminder Singh has not stated that he has been authorised by any resolution passed by Board of Directors of plaintiff no. 1 to institute the present suit. There is no evidence to prove that Shri Manminder Singh has authority to institute the present suit on behalf of both the plaintiffs. This issue is accordingly decided in favour of the defendant and against the plaintiffs.
18. Issue No. 2In para 4 of the plaint, it is stated that predecessor of plaintiff no. 1 on 01.04.1984 adopted the trade mark AYUR in respect of cosmetic products and plaintiff no. 1 extended its use to Suit No. 106/08/00 15 ayurvedic medicines in the year 1995. In para 5 of the plaint, it is mentioned that plaintiff is the registered proprietor of trade mark AYUR as per details given below :
Trade Mark Class Description of Goods No. 421919 3 Cosmetics 504095 5 Face pack kit for skin treatment included in class 5.
548522 16 Paper and paper articles, cardboard and cardboard articles, printed matter, Newspaper and periodicals, Books, Photographs, Stationery, Artists materials, office requisites, instructional and teaching material, Certificates.
566257-B 29 Meat, fish, poultry and game, meat extracts, preserved, dried and cooked fruits and vegetables, jellies, jams, eggs, milk and other dairy products, edible oils and fats preserves pickles.
536258-B 30 Coffee, tea cocoa, sugar, rice tapioca, sago coffee substitutes, flour and preparations made from cereals, bread, biscuits (not for animals) cakes, pastry and confectionery (non-
medicated), ices, honey, treacle, yeast, baking powder, salt, mustard, pepper, vinegar, sauces, spices etc. 536261 33 Wine, Sprit and Liqueurs.
19. In para 6 of the affidavit Ex.P-1/A also the plaintiff has reiterated contents of para 5 of the plaint. In para 6 of the plaint, the plaintiff has mentioned various applications made by the plaintiff for obtaining registration in different classes and for Suit No. 106/08/00 16 different description of goods. As per case of plaintiffs, the plaintiff no. 2 is selling AYUR DIA-SLIM which is an ayurvedic treatment (Dia Slim Tumblers) for reducing fat and weight and also controlling sugar and the said product is being sold since the year 1995 continuously. In para 9 of reply on merits in the WS, the defendant no. 2 has stated that the product in question in the present suit i.e. AYUR DIA-SLIM clearly and unambiguously states on its wrapping that it is manufactured by plaintiff no. 2 and in the same para defendant no. 2 has further stated that the instructions/information appearing on the plastic wrapper indicate the said product which is a cylindrical receptacle, fashioned out of wood for drinking water, which is primarily to control diabetes and also reduces excessive fat from the body from soaking the water in the wooden tumbler overnight and consuming it in the morning. However, in the WS, the defendant no. 2 has not denied that the plaintiff is not the proprietor of the trade mark AYUR DIA-SLIM. In the cross-
examination , PW-1 Shri Manminder Singh stated that AYUR DIA-SLIM is the trade mark of the plaintiff which is subject matter of the present suit. In further cross-examination of PW- 1, defendant put questions regarding the purpose of AYUR DIA-SLIM and the price of the same but no suggestions were given to PW-1 in the cross-examination to the effect that plaintiff is not the proprietor of trade mark AYUR DIA-SLIM. The defendant no. 2 has failed to rebut that the plaintiff is the proprietor of trade mark AYUR DIA-SLIM. Accordingly, this issue is decided in favour of the plaintiff and against defendant no. 2.
20. Issue Nos. 3 & 4Since both these issues involve common discussion of facts Suit No. 106/08/00 17 and law, hence, for the sake of brevity, both these issues are being taken up together. In the plaint, the plaintiff has set up a case that plaintiff no. 1 has entered into an agreement with plaintiff no. 2 to sell products under the mark AYUR of plaintiff no. 1 and plaintiff no. 2 is selling AYUR DIA-SLIM which is an ayurvedic treatment for reducing fat and weight and also controlling sugar since the year 1995 continuously and the plaintiffs have given wide publicity to its product and the sales of AYUR DIA-SLIM by plaintiff no. 2 has increased from Rs.3,25,000/- in the year 1995-96 to Rs. 80,54,337/- in the year 1999-2000. Ld. Counsel for defendant no. 2 has contended that the trade mark AYUR DIA-SLIM is not registered trade mark and has pointed out to the order dated 28.07.2000 whereby the application u/o 39 rules 1 & 2 CPC of the plaintiff and application u/o 39 rule 4 CPC of the defendant were disposed off wherein Hon'ble High Court has been pleased to observe that during the course of arguments, ld. Counsel for the plaintiffs states that he is not pressing the relief for infringement as the trade mark is not registered for AYUR DIA- SLIM Tumbler and is confining his case for an injunction in respect of passing off only. As the plaintiffs have not proved that the trade mark AYUR DIA-SLIM is the registered trade mark, accordingly the case is to be examined from the view that whether the defendant no. 2 is passing off its goods as those of the plaintiffs.
21. The case of the plaintiff is that it is manufacturer of cosmetic products including creams, skin care lotions, shampoos, hair care treatment material, tea and ayurvedic medicines etc. and plaintiffs are also selling its product AYUR DIA-SLIM tumbler which is ayurvedic treatment for reducing fat and weight and Suit No. 106/08/00 18 also controlling sugar since the year 1995. In para 14 of the plaint, the plaintiff has mentioned that they came to know in the first week of June, 2000 that the defendant is manufacturing, selling and/or offering for sale medicines under the trade mark AYURSLIM CAPSULES and the defendant no. 2 claims that these capsules burns excess fat under the trade mark AYURSLIM. The contention of plaintiff is that all the essential features of plaintiffs trade mark and copyright have been copied and imitated on the products manufactured and marketed by the defendant and the product of the defendant i.e. AYURSLIM CAPSULE is equivalent to the plaintiffs product AYUR DIA-SLIM. The contention of the plaintiff is that the trade mark AYURSLIM of the defendant is identical and/or deceptively similar to that of the plaintiffs trade mark and copyright AYUR and AYUR DIA-SLIM.
22. It is to be seen that the product of the plaintiff is a wooden tumbler which is being sold by the plaintiff for the purpose of reducing fat, weight and also controlling sugar and the product of the defendant no. 2 which is being sold under the trade mark AYURSLIM are capsules targeted at people having general overweight and obesity problems. The case of the plaintiff is that they are selling the AYUR DIA-SLIM since the year 1995 and in June, 2000 the plaintiff came to know that the defendants are manufacturing and selling and/or offering for sale medicines under the trade mark AYURSLIM CAPSULES. The contention of the plaintiff is that the plaintiff is using the trade mark AYUR DIA-SLIM since the year 1995 and that the plaintiff is the prior user as compared to AYURSLIM as is being used by defendant no. 2. In para 11 of reply on merits of the WS, the defendants have mentioned the sales figures of Suit No. 106/08/00 19 AYURSLIM CAPSULES from November 1998.
23. Section 34 of the Trade Marks Act,1999 reads as under :-
"34. Saving for vested rights.- Nothing in this Act shall entitle the proprietor or an registered user of registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods or services in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date prior -
(a) to the use of the first-mentioned trade mark in relation to those goods or services by the proprietor or a predecessor in title of his; or
(b) to the date of registration of the first-
mentioned trade mark in respect of those goods or services in the name of the proprietor of a predecessor in title of his;
whichever is the earlier, and the Registrar shall not refuse (on such use being proved), to register the second mentioned trade mark by reason only of the registration of the first mentioned trade mark.
24. Section 35 of Trade Mark Act, 1999 provides that priority of use prevails as compared to registration and it lays down that ordinarily it is the prior user of the trade mark who is the owner of trade mark.
25. In Century Traders Vs. Rohan Lal Duggar & Co. & Others 1978 Delhi 250, reference was made to Consolidated Foods Corporation vs. Brandon and Co. Private Ltd., AIR 1965 Suit No. 106/08/00 20 Bom 35 wherein it was observed :-
"12. A trader acquires a right of property, in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. The trader who adopts such a mark is entitled to protection directly the article having assumed a vendible character is launched upon the market. Registration under the statute does not confer any new right to the mark claimed or any greater rights than what already existed at common law and at equity without registration. It does, however, facilitate a remedy which may be enforced and obtained throughout the State and it established the record of facts affecting the right to the mark. Registration itself does not create a trade mark. The trade mark exists independently of the registration which merely affords further protection under the Statute. Common law rights are left wholly unaffected. Priority in adoption and use of a trade mark is superior to priority in registration. ........................................................................
14. Thus, the law is pretty well settled that in order to succeed at this stage the appellant had to establish user of the aforesaid mark 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 for passing off and the mere presence of the Suit No. 106/08/00 21 mark in the register maintained by the trade mark 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 trademarks.
26. In Bimal Govindji Shah vs. Panna Lal Chandu Lal, 1997 PTC (17) it was held that :
9."..............................Thus a conjoint reading of the aforesaid provisions persuaded me to conclude on a reading of the aforesaid provisions conjointly the natural deduction is that the right conferred by Section 28(1) of the Act in favour of a registered proprietor of a trade mark is not an absolute right but is subject to the other provisions of the Act namely -Section 27(2) and 33. It is also to be noted that neither Section 28 nor any other provision of the Act prohibits an action for passing off by an anterior user of a trade mark against a registered user of the same. In other words registration of a trade mark does not provide a defence to the proceedings for passing off as provided for under Section 27(2) of the Act. A prior user of a trade mark is entitled to maintain an action against a subsequent user of identical trade mark including registered user thereof.Suit No. 106/08/00 22
27. As per aforesaid judgments, it is well settled that registration is irrelevant in case of passing off and a prior user of trade mark is entitled to maintain an action against the subsequent user of identical trade mark including registered user thereof.
28. In M/s Pidilite Industries Pvt. Ltd. vs. M/s Mittees Corporation and Another, 1988 (2) Arbitration Law Reporter 4 (Delhi), it was held :-
"......................Before, I take up the comparison of the two marks or the similarity or dissimilarity on the containers it would be opposite to state some well settled principles governing these matters, namely (1) it is always a question of fact in each case whether the deception or confusion is likely to be caused or not by use of the impugned trade mark; the court has to put itself in the position of an average customer and ask a question whether there is likelihood of deception or confusion or not and then answer the question on that basis, (2) the marks must be compared as a whole. It is not rights to take a portion of the word and say that because that portion of the word differs from the corresponding portion of the word in the other case, there is no sufficient similarity to cause confusion. The totality of the trade marks is to be seen to find out whether there is likelihood of deception or confusion or Suit No. 106/08/00 23 mistake in the minds of persons accustomed to the existing trade mark, (3) the likelihood of confusion or deception is to be seen in relation to average unwary customer, (4) it is the tendency to mislead or cause confusion that forms the gist of passing off action and the plaintiff need not establish the actual deception."
29. The plaintiff has contended that they are selling their products under the trade mark AYUR DIA-SLIM TUMBLER while the defendant no. 2 is selling its product under AYURSLIM CAPSULES and there is phonetic similarity and also similarity in over all appearance of the said trade marks and they are likely to cause deception. The contention of ld. Counsel for defendant no. 2 is that there is no similarity in both the marks as in AYUR DIA-SLIM TUMBLER the word AYUR is being used by the plaintiff separately in a oval shape and the words DIA-SLIM TUMBLER have been separated from the said word AYUR while in AYURSLIM CAPSULES all the words i.e. AYURSLIM CAPSULES are being used together and they do not signify that the defendant no. 2 claims it to be a product manufactured by the plaintiffs and they are not likely to cause deception in the minds of the public that product of the defendant no. 2 is a product which is manufactured by plaintiffs.
30. In Dabur (S. K. Burman) vs. Vikas Pharma, 1983 PTC 179, it was held :-
"Secondly. On the question whether Suit No. 106/08/00 24 there is any deceptive similarity between the two trade marks in question, I am of the opinion that there is a phonetic similarity. The vocal sounds of the two very much resemble. They produce the same sounds of speech with a slight difference of 'A'. In the pronunciation of word HAJMOLA AND HAZMOL. There is hardly any difference of note. HAJMOLA is the plaintiff's trade mark. Hazmol is the trade mark of the defendant except that the suffix 'A' is in addition in the plaintiff's trade mark, there is not much substantial difference between the two. The plaintiff has used the word 'J'. the defendant has used the word 'Z'. This is a distinction without any difference. The only difference is that the defendant do not have the word 'A" at the end of their trade mark 'HAZMOL'. In my opinion the buyers of the products are likely to be deceived and confused if the defendants are allowed to sell their products in the market........................."
31. In Lakme Ltd. vs. Subhash Trading, 1996 PTC (16), it has been held :-
9. 'In the case of K. R. Chinna Krishna Chettiar Vs. Ambal & Co. and another, reported in AIR 1970 SC 146 it has been held that the resemblance between the Suit No. 106/08/00 25 two marks must be considered with reference to the ear as well as the eye and ocular comparison is not always the decisive test. Therefore, even if there be no resemblance between the two marks that does not matter when there is a close affinity of sound between the distinctive features of the two marks. The Supreme Court further pointed out that merely because the distinctive words used in both the marks have distinctive meaning it cannot be said that the phonetic resemblance does not lead to confusion, when it is likely that majority of the customers are not capable of understanding the fine distinction between the meanings of the two words.
In the same case the Supreme Court was called upon to consider whether there is striking similarity and affinity of sound between the words "AMBAL" and "ANDAL". After considering various decisions, the Supreme Court held that there is a close affinity of sound between the words "AMBAL" and "ANDAL".
Similarly in the case of Ruston Vs. Zamindara Engg. (supra), the Supreme Court came to consider whether there was resemblance between the words "RUSTON" and "RUSTAM", and on consideration of various decisions came Suit No. 106/08/00 26 to uphold the decision of the High Court that there was deceptive resemblance between the words "RUSTON" and "RUSTAM" and therefore, the use of the bare word "RUSTAM" constituted clear infringement of the plaintiff's trade mark "RUSTON"
13 .............................................................. ......When both the words are articulated, it would be difficult for an ordinary prudent man to distinguish between the two sounds produced by the two words.
Applying the test of phonetic resemblance as laid down by the Supreme Court I am of the view that there is a striking resemblance between the two words and there is a real danger of deception and confusion being caused by the two marks in view of the similarity and affinity of sounds between the words "LIKE ME"
and "LAKME".
32. The plaintiffs have placed label of AYUR DIA-SLIM TUMBLER on record which is Ex.PW1/1 and the carton as used by defendant no. 2 in respect of AYURSLIM CAPSULES which is Ex.PW1/62. Perusal of label of the plaintiff shows that the plaintiff has used word AYUR above the other contents of the label in a oval shape and the remaining part of the trade mark i.e. DIA-SLIM TUMBLER has been mentioned in bold letters below the said word AYUR. The label of the plaintiff Ex.PW1/1 has been designed in such fashion so as to convey that the Suit No. 106/08/00 27 DIA-SLIM TUMBLERS have been manufactured by the manufacturers of the brand AYUR. Perusal of the label of the carton of defendant no. 2 Ex.PW1/62 shows that the defendant no. 2 has prominently displayed logo of its company which is AYURVEDIC CONCEPTS on the top and thereafter AYURSLIM is mentioned and below that CAPSULES are mentioned. Below the words AYURSLIM CAPSULES on Ex.PW1/62 the defendant no. 1 has mentioned in smaller letters that it regulates production of fat, long-lasting effect.
33. In Parle Products (P) Ltd. vs. J. P. & Co., Mysore, PTC (Suppl) (1) 346 (SC), the Apex Court took the view that :-
"It is therefore clear that in order to come to the conclusion whether one mark is deceptively similar to another, the broad and essential features of the two are to be considered. They should not be placed side by side to find out if there are any differences in the design and if so, whether they are of such character as to prevent one design from being mistaken for the other. It would be enough if the impugned mark bears such an overall similarity to the registered mark as would be likely to mislead a person usually dealing with one to accept the other if offered to him."
34. In Corn Products Vs. Shangrila Food Products, AIR 1960 SC 142, the Hon'ble Supreme Court observed :-
"The question whether the two marks are likely to give rise to confusion or not is a question of first impression. It is for the Court to decide that Suit No. 106/08/00 28 question. It is well recognised that in deciding a question of similarity between two marks, the marks have to be considered as a whole."
Further, it is held in the said ruling as follows :
"Again in deciding the question of similarity between the two marks, we have to approach it from the point of view of a man of average intelligence and of imperfect recollection. To such a man the overall structural and phonetic similarity and the similarity of the idea in the two marks is reasonably likely to cause a confusion between them."
35. Applying the tests as laid down by the Hon'ble Supreme Court in Corn Products vs. Shangrila Food Products (supra), a perusal of label Ex.PW1/1 and that of the defendant no. 2 which is Ex.PW1/62 would show that there is no phonetic or visual similarity between the two labels. The label of the plaintiff is on the white background while that of the defendant is on a light green background, their colour combinations are different, font of the letters and logos of the both the parties are also totally different.
36. The contention of the ld. Counsel for the plaintiff is that product of the plaintiff and defendants are being sold at the same shops and they are likely to cause deception in the minds of the customers. However, it is to be noted that product of the plaintiff is a wooden tumbler and that of the defendant no. 2 are capsules and, moreover, in cross-examination, PW-1 states that the price of AYUR DIA-SLIM TUMBLER is Rs.55/- per piece and as per Ex.PW1/62, which is carton of the product of Suit No. 106/08/00 29 defendant no. 2, price of one bottle of 60 capsules is Rs.100/-. In the circumstances, as there is distinctiveness in the appearance of the two products i.e. one is a tumbler and other are capsules, it cannot be said that there is probability of deception and it is not possible that a person would be confused by the product of the defendant no. 2 for that of the plaintiff. Moreover there is substantial price difference between the two products and the person who wants to buy product of the plaintiff at Rs.55/- will not buy product which is worth double the said amount and above all there is clear distinction between the mode of use of the two products i.e. in the tumbler which is the product of the plaintiff, water is soaked overnight and consumed in the morning while the product of defendant no. 2 is a capsule to be taken orally. In the circumstances, it cannot be said that there is similarity in the products which is likely to deceive the buyers.
37. The contention of plaintiffs is that the plaintiffs product is meant for controlling diabetes and for regulation of production of fat and reduction of cholesterol and product of defendant no. 2 also claims reduction of fat and on that account they are likely to cause deception in the minds of the public. However, this contention of plaintiffs has no force on account of vast difference in the physical appearance of the two products and mode of consumption of the said products.
38. Another contention of the plaintiff is that the product of the plaintiff has acquired distinctiveness on account of use of its brand which is AYUR and has contended that AYUR is an invented word and is generic and distinctive in nature and the defendant has used AYUR in combination with SLIM and it Suit No. 106/08/00 30 would convey that AYURSLIM is a product of the plaintiffs and may deceive the buyers who may buy the same considering it to be the product of the plaintiffs. Contention of defendant no. 2 is that AYUR is a Hindi word which is defined to mean traditional Indian science of health and medicines and the word AYUR is being used in a number of other applications in combination with other words. The Hon'ble High Court was pleased to consider the rival submissions of parties while disposing of application u/o 39 rules 1 & 2 CPC of the plaintiff and application u/o 39 rule 4 CPC of the defendant vide order dated 28.07.2000 by observing that the defendant has clearly shown by reference to the Oxford Hindi English Dictionary that 'AYUR' is a Hindi word which is defined to mean the traditional Indian science of health or medicine. In the order dated 28.07.2000, the Hon'ble High Court was also pleased to observe that while the word 'AYUR' may be a key part of the trade dress of the plaintiff's product, it is not the key part of the trade dress of the defendant's product.
39. Another contention of ld. Counsel for defendant no. 2 is that the defendant no. 2 is not using the word AYUR in isolation but the word AYUR is being used in combination with SLIM making it AYURSLIM and the plaintiffs product is DIA-SLIM which is a trade mark and there is no likelihood of deception between the two products. Ld. Counsel for the defendant no. 2 has contended that defendant no. 2 is selling goods being ayuevedic medicines and the plaintiff has not proved that its product AYUR DIA-SLIM TUMBLER is registered trade mark in respect of ayurvedic medical preparation in class 5 and it is an agricultural/forestry product that falls within the ambit of Class
31. The contention of ld. Counsel for defendant no. 2 is that Suit No. 106/08/00 31 defendant no. 2 is a well known for making ayurvedic medicines and there is no likelihood that product of defendant no. 2 will be passed off as the products of the plaintiffs. Another contention of ld. Counsel for the defendant no. 2 is that the product of defendant no. 2 were being sold under the umbrella mark AYURVEDIC CONCEPTS which is well known for making ayurvedic preparations and have gained immense reputation and popularity in India and abroad and it is not possible that the products of the defendant no. 2 will be passed off as products of the plaintiff. It is to be noted that in para 5 of the plaint, plaintiff has proved various certificates of registration of trade marks. However, the plaintiff has not proved that trade mark AYUR DIA-SLIM TUMBLER is either registered or the plaintiff has applied for the registration of the same in class 5.
40. In Goenka Institute of Education & & Research vs. Anjani Kumar Goenka & Anr., 2009(40) PTC 393 (Del) (DB), our Hon'ble High Court laid down tests for passing off as :
(1) a misrepresentation,
(2) made by a trader in the course of trade,
(3) to prospective customers of his or ultimate consumers of
goods or services supplied by him,
(4) which is calculated to injure the business or goodwill of
another trader (in the sense that this is a reasonably foreseeable consequence), and (5) which causes actual damage to a business or goodwill of the trade by whom the action is brought or (in a quia timet action) will probably do so."
41. In case of Syncom Formulations v. SAS Pharmaceuticals, 2004 (28) PTC 632 (Del) our own Hon'ble High Court Suit No. 106/08/00 32 considered the question whether trademark REGULIN and REGULIN FORTE of the appellant were deceptively similar to the trade mark REGU-30 of the respondent and the Hon'ble High Court observed:-
15.The principles laid down in these (and other) decisions were visited by the august Supreme Court in Cadila Health Care Ltd v. Cadila Pharmaceuticals Ltd., (2001) 5 SCC 73 with particular reference to medicinal products. In that case, the two competing products were 'Falcigo' and 'Falcitab'. The august Supreme Court declined to interfere with an order refusing to grant an injunction because "there may be possibility of evidence being required on merits of the case and directions were given for speedy trial of the suit." However, the august Supreme Court laid down the factors to be considered while deciding the question of deceptive similarity of goods. These were:
(a)The nature of the marks i.e. whether the marks are word marks or label marks or composite marks i.e. both words and label works.
(b)The degree of resembleness (sic) between the marks, phonetically similar and hence similar in idea.
(c)The nature of the goods in respect of which they are used as trade marks.
(d)The similarity in the nature, character and performance of the goods of the rival traders.
(e)The class of purchasers who are likely to buy the goods bearing the marks-they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods.
(f)The mode of purchasing the goods or placing orders for the goods.
(g)Any other surrounding circumstances which may be relevant in the extent or dissimilarity between the competing marks.Suit No. 106/08/00 33
42. In view of aforesaid pronouncements, the plaintiff was required to prove that product of the plaintiff has acquired distinctive character and the product of defendant no. 2 is deceptively similar to the product of the plaintiffs and that the person of ordinary prudence is likely to be deceived in buying product of the defendant no. 2 considering it to be product of the plaintiff on account of distinctiveness having been acquired by the product of the plaintiff. It has been discussed above that there is no over all similarity between the two products i.e. there is no similarity between the two products regarding their trade marks, appearance of cartons, colour combinations, font of alphabets, script, phonetic or visual similarity, price, physical appearance of the products and the mode of use of the products. In the circumstances, it cannot be said that a buyer of ordinary prudence may be deceived in buying product of defendant no. 2 i.e. AYURSLIM CAPSULES considering it to be product of plaintiffs i.e. AYUR DIA-SLIM TUMBLER. The plaintiff has failed to prove that the defendant no. 2 is passing off its goods as that of the plaintiff. Accordingly, both these issues are decided in favour of the defendant and against the plaintiff.
43. Issue No. 5In para 20 of the plaint, it is stated that for the purpose of court fee and jurisdiction in respect of relief of injunction in respect of trade mark AYUR and for relief of permanent injunction in respect of infringement of copyright/artistic work and in respect of relief of injunction for passing off and for order of delivery up of the goods, the suit has been valued at Rs.200/- each and court fee of Rs.20/- for each relief is paid and in respect of Suit No. 106/08/00 34 jurisdiction it has been tentatively valued at Rs.5,00,500/- and the total jurisdiction value of the suit is 5,01,300/- and court fee or Rs.100/- is affixed and the plaintiff undertakes to make up deficiency in the court fee on defendants' rendering their accounts of profits and as and when directed by the Court. Section 7(iv)(d) of the Court Fees Act, 1870 provides that amount of court fee payable to obtain injunction shall be according to the amount at which relief sought is valued in the plaint. Hence, for the reliefs of permanent injunction as sought in respect of infringement of trade mark and copyright for action of passing off and for delivery up, the suit has been valued correctly and court fees accordingly on the same has been paid. However, although the suit has been valued at Rs.5,00,500/- for the purpose of jurisdiction , in view of Section 7(iv)(f) of the Court Fees Act, 1870, court fee on the same shall be paid according to the valuation as given by the plaintiff but the plaintiff has not paid court fees on said amount of Rs.5,00,500/-. Accordingly, the deficiency in court fees is to be made up by the plaintiff. This issue stands answered accordingly.
44. Issue Nos. 6 & 7Since both these issues involve common discussion of facts and law, hence, for the sake of brevity, both these issues are being taken up together. In view of findings on issue no. 3 &4 above, the plaintiff is not entitled to the decree of permanent injunction and decree of rendition of accounts, as prayed. Both these issues stand answered accordingly.
Suit No. 106/08/00 3545. Issue No. 8 (Relief) In view of aforesaid discussions and findings on above issues, suit of the plaintiff is dismissed. Parties are left to bear their own costs. Decree sheet be prepared on depositing of the deficient court fees within a period of one month from today. Thereafter, file be consigned to Record Room.
(Announced in the open Court (HARISH DUDANI) on 27th March, 2010) ADDL. DISTT. JUDGE-15 (CENTRAL) DELHI Suit No. 106/08/00 36