Delhi District Court
M/S. Orient Bell Limited vs M/S. Royal Marketing on 4 January, 2018
IN THE COURT OF SH. JOGINDER PRAKASH NAHAR, ADDITIONAL
DISTRICT JUDGE-04, CENTRAL, TIS HAZARI COURTS, DELHI
TM No. 928/16
M/S. ORIENT BELL LIMITED
IRIS HOUSE 16, BUSINESS CENTRE
NANGAL RAYA
NEW DELHI-110046 ......Plaintiff
Versus
1. M/S. ROYAL MARKETING
RZ-3, MANGOL PUR KHURD
DELHI-110083
2. M/S. ORIENT CERA TILES
NEAR SATYAM PULES MILL
OPP. SAHAKARI JIN, NH-8
KANKNOL, HIMATNAGAR (S.K)
GUJARAT ......Defendants
Date of Institution : 22.02.2002
Date of judgment reserved on : 04.01.2018
Date of judgment : 04.01.2018
SUIT FOR PERMANENT INJUNCTION RESTRAINING INFRINGEMENT OF
TRADEMARK, PASSING OFF OF TRADE MARK, TRADE NAME,
INFRINGEMENT OF COPYRIGHT, DAMAGES, DELIVERY UP ETC.
JUDGMENT
1. The present suit is filed by the plaintiff for permanent injunction restraining infringement of trademark, passing off of trade mark, trade name, infringement of copyright, damages, delivery up etc. against the defendant. It is submitted that plaintiff company originally incorporated on 18.05.1997 as Orient Ceramics and Industries Ltd. which later on merged on 07.02.2012 with Bells Ceramics Ltd. after obtaining orders from Hon'ble Court at Gujarat. After merger the name is Orient Bell Ltd. registered at Uttar Pradesh with fresh certificate of incorporation dated 15.03.2012 (hereinafter referred as plaintiff). The plaintiff is engaged in the business of manufacturing tiles. The company adopted trademark Orient for its goods ceramic tiles, building materials, non-metallic, pipes, asphalt, pitch and bitumeni, non-metallic transportable building, monument, tiles, plastic flushing cistern. The trademark is used by the plaintiff uninterruptedly and continuously since the year 1982 in respect of tiles which is painted on reverse side of each tile.
2. The plaintiff has also exported its tiles. The sale in terms of money in each financial year runs into several crore of rupees. Plaintiff has acquired goodwill and reputation and has spent large amount on publicity and advertisement of his trademark. The advertising expenses runs into multiples of lakhs since the year 1995-96. Plaintiff has supplied its tiles for use to both government and non-government departments in large numbers and its goods are demonstrated at various exhibitions. Plaintiff has devised a logo title as Orient Tiles in an artistic manner. Plaintiff is also holding registration of Copyright as Orient Tiles vide no. A-68840/2005.
3. In the month of January 2002 plaintiff received information regarding infringement of his trademark Orient by M/s. Royal Marketing having shop at RZ-3, Mangolpur Khurd, Delhi-110083. Defendant no. 2 is supplying tiles to defendant no. 1 and also to other shops at Delhi in infringement of trademark of plaintiff. Thereby defendant no. 2 has created impression in the market that his goods are connected with plaintiff and thereby passing off the goods by infringing trademark of the plaintiff. The trade name adopted by defendant no. 2 is identically and deceptively similar to the corporate name of the plaintiff. Thereby the triple test of identical goods, identical trademark/trade name and identical trade channel are satisfied in the present case and dishonest motive and mischief of the defendants are revealed.
4. It is submitted by the plaintiff that the tiles are purchased both by illiterates and literates which cause confusion among both. It harmed reputation and goodwill of the plaintiff. The loss to the plaintiff cannot be calculated in terms of money. Accordingly, plaintiff has prayed for decree of suit against the defendant. Permanent injunction is prayed against defendants and their agents from selling, executing the goods by the trademark Orient and also to protect its copyright. Permanent injunction is also prayed to restrain the defendants from exhibiting or advertising the goods by the trademark Orient. It is further prayed that delivery of all material including labels, blocks, dies, strips, cartons, stationery, literature or any other printed matter bearing the impugned trademark for their further destruction and for their erasure.
5. Defendant no. 2 is ex-parte vide order dated 09.08.2002 in terms of order dated 15.05.2002. Defendant no. 2 was proceeded ex-parte vide order dated 09.08.2002. Thereafter defendant no. 2 had appeared for setting aside ex-parte order dated 15.05.2002. Vide order dated 11.07.2003 the ex-parte order against defendant no. 2 was set aside. Defendant no. 2 was again proceeded ex-parte vide order dated 07.11.2008.
6. In the written statement filed by defendant no. 2 it is submitted that the trade of defendant is in existence in partnership since the year 1995 and plaintiff is non-suited on ground of acquiescence. The trade name Orient is generic name and the plaintiff cannot have monopoly over it. The plaintiff himself has annexed his business only from the year 1997 and at that time defendant was in existence doing business in fans and cement. Defendant is in said business for last more than 30 years. There are more than 100 companies doing business under the name of Orient. There is no likelihood of deception as there is huge price difference in the products of plaintiff and defendants. The carton and boxes are also different and the word Orient is not written in similar manner. The defendant writes Orient Cera Tiles and the plaintiff writes Orient Walls. The address of defendant is also mentioned on the product making a distinction. The defendant writes letter in bold. The contractors/buyers therefore very well recognize the difference who are expert in their field. It is submitted that the expense on advertisement and volume of sale does not entitle plaintiff monopoly over the word Orient when the defendant itself is in existence since the year 1996. The telephone directory indicates about 100 manufacturers/dealers by the said name. It is submitted that the first user is not the only criteria for determining the right and entitlement in the intellectual property rights. There is difference both in quality and price of which the buyers can clearly make distinction. Accordingly, defendant no. 2 has denied the claim of the plaintiff and prayed for dismissal of the suit.
7. In the replication filed by the plaintiff to the written statement of defendant no. 2 the averments made in the plaint are reaffirmed and the claim of defendant no. 2 is denied. It is submitted that plaintiff company was incorporated in the year 1997 and using trademark since the year 1982 who has built up its business slowly and steadily and thereby built up its goodwill in market which defendants seeks to illegally encash upon. It is submitted that defendants have merely denied the claim of the plaintiff and accordingly the plaintiff has prayed for decree of suit in his favour.
8. On the pleadings of the parties and averments made following issues in the case were framed on 04.01.2018 which are as under:-
1. Whether plaintiff is entitled to relief of permanent injunction against both the defendants and its agents in restraining passing off of the trademark ORIENT and its infringement of trademark in copyright by way of manufacturing, exporting, selling, exhibiting etc. in the said name? OPP
2. Whether plaintiff is entitled to mandatory injunction against defendants and their agents as to delivery of labels, blocks, dies, strips, cartons, stationery, literature or any other printing material bearing impugned trademark and copyright and for their destruction/erasure? OPP
3. Whether plaintiff is entitled to damages for a sum of Rs.10 lakhs against both the defendants for such infringement of trademark and copyright of mark Orient? OPP
4. Relief.
9. P1 is V.P. Khare, P2 is Rajesh Bagri from the plaintiff company whose cross examination was nil by defendant no. 2 despite grant of opportunity and PE was closed on 30.01.2017. P3 is Yogesh Mendiratta during whose evidence both the defendants were ex-parte. Plaintiff evidence was again closed on 05.11.2017. In order dated 25.09.2002 witness P1 had appeared whose documents are exhibited as Ex.P1/1 to Ex.P1/11. The documents and Ex. P2/1 to Ex.P2/12 were exhibited when the defendants were ex-parte. The witness P1 has not appeared to tender evidence after setting aside of ex-parte order against defendant no. 2 therefore his evidence is not read and not relied upon. Ld. Counsel for the plaintiff has admitted the said position and has submitted that the witness P1 has left the services of the plaintiff and thereafter the witness P2 and P3 has deposed about the case of the plaintiff after filing of amended plaint on 01.03.2013 from the date of filing of application u/o 6 rule 17 CPC. Defence of defendant no. 1 was struck off on 17.08.2013 on non-filing of written statement. Defendant no. 2 is already ex-parte vide order dated 07.01.2008. Issues in the matter were framed on 04.01.2018 and on which issues the plaintiff seeks to rely on same evidence already tendered through P2 and P3. He does not seek to bring more evidence in the present case. Hence, the matter is proceeded further.
10. Parties heard and record perused. Issuewise findings is as follows:-
ISSUE NO. 1.
Whether plaintiff is entitled to relief of permanent injunction against both the defendants and its agents in restraining passing off of the trademark ORIENT and its infringement of trademark in copyright by way of manufacturing, exporting, selling, exhibiting etc. in the said name? OPP
11. P2 Sh. Rajesh Bagri who is Assistant General Manager of plaintiff company has deposed that he had tendered his evidence before Ld. Joint Registrar, Hon'ble High Court of Delhi on 25.09.2002 and further the supplementary affidavit is filed as Ex.P2/A. He relied upon the documents Ex.P2/13 to Ex.P2/17. Defendants had not appeared to cross examine the witness and the evidence of P2 was closed. P3 Sh. Yogesh Mendiratta Company Secretary of the plaintiff firm has tendered his evidence by way of affidavit Ex.P3/A as additional affidavit and relied upon documents Ex.P3/1 and Ex.P3/2. Before that ex-parte evidence was once concluded on 26.07.2005. The above witnesses are unrebutted and unimpeached and found consistent. The witnesses have deposed in same terms of the pleadings of the plaintiff.
12. Ex.P2/17 is obtaining of certificate of registration of trademark vide no. 1524147 dated 17.01.2007 issued on 01.02.2011 in the name of ORIENT. Ex.P3/2 is extract from register of copyright in the name of plaintiff as owner vide registration no. A-68840/2005 in the name ORIENT. It is submitted by the plaintiff that trademark in the name ORIENT for plastic flushing cistern was obtained in the year 2000 and for Orient Ceramic Tiles was obtained on 01.08.2005. P3 has deposed being so authorized by its plaintiff's directors in place of Sh. Dileep Chandwani. The advertisement cuttings and invoices in the name of Orient Tiles are collectively exhibited as Ex.P1/5.
13. It is submitted by ld. Counsel for plaintiff that the present case falls under the Trademark and Mercantile Marks Act (old). However, it is further submitted that under the new Act the scope of services under the Trademark are extended with no curtailment of rights under the Trademark. Ld. Counsel for plaintiff has relied upon citation titled as American Home Products Corpn. v. Mac Laboratories Pvt. Ltd. AIR 1986 137, 1985 SCR Supl. (3) 264 at para no. 36 reproduced as under:
"The object underlying section 46(1) is to prevent trafficking in trade marks. This is, in fact, the object underlying all trade mark laws. A trade mark is meant to distinguish the goods made by one person from those made by another. A trade mark, therefore, cannot exist in vacuo. It can only exist in connection with the goods in relation to which it is used or intended to be used. Its object is to indicate a connection in the course of trade between the goods and some person having the right to use the mark either with or without any indication of the identity of that person. Clause (v) of section 2(1) which defines the expression 'trade mark' makes this abundantly clear. Trade marks became important after the Industrial Revolution a distinguish goods made by one person from those made by another; and soon the need was felt to protect traders against those who were unauthorizedly using their marks and accordingly registration of trade marks was introduced in England by the Trade Marks Registration Act, 1875, which was soon replaced by more detailed and advanced legislation. When a person gets his trade mark registered, he acquires valuable rights by reason of such registration. Registration of his trade mark gives him the exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or deceptively similar to his trade mark, he can protect his trade mark by an action for infringement in which he can obtain injunction, damages or an account of profits made by the other person. In such an action, the registration of a trade mark is prima facie evidence of its validity. After the expiry of seven years from the date of the registration a trade mark is to be valid in all respects except in the three cases set out in section 3. The proprietor of an unregistered trade mark whose mark is unauthorisedly used by another cannot, however, sue for the infringement of such trade mark. His only remedy lies in bringing a passing-off action, an inconvenient remedy as compared to an infringement action. In a passing-off action the plaintiff will have to prove that his mark has by user acquired such reputation as to become distinctive of the plaintiff's goods so that if it is used in relation to any goods of the kind dealt with by the plaintiff, it will be understood by the trade and public as meaning that the goods are the plaintiff's goods. In an infringement action, the plaintiff is not required to prove the reputation of his mark. Further, under section 37 a registered mark is assignable and transmissible either with or without goodwill of the business concerned while under section 38 an unregistered trade mark is not assignable or transmissible except in the three cases set out in section 38(2)."
14. The trademark of plaintiff is ORIENT which is not only deceptively similar but exactly similar to the mark used by the defendants. The defendants have failed to appear and to disprove the case of the plaintiff in evidence. Mere making averments in written statement without being subjected to cross-examination does not make out defence in favour of defendants. The defendants have failed to appear to show that their case falls under any of the exceptions laid down u/sec. 32 of the Trademark Act. Now the trademark ORIENT is validly registered with the plaintiff which remains uncontested by the defendant before the present Court. Nor it is shown that the same was contested before the registrar of trademark. Hence, the action of plaintiff has culminated from passing an action an inconvenient remedy to an action for infringement of the trademark registered with the plaintiff being the owner. The plaintiff is using the said mark ORIENT which is also signified by the name of plaintiff company which is M/s. Orient Ceramics and Industries Ltd. having registered office at Secundrabad, U.P and head office at Delhi. Plaintiff company is using the name since the year 1977 when it was incorporated and in the year 1982 it had adopted the trademark name ORIENT. However, the plaintiff must show the actual infringement on the date of filing of the suit. The suit was filed on 22.02.2002 at which time the said mark ORIENT was in use by the plaintiff company. As per claim of the plaintiff the mark ORIENT for plastic flushing cistern has date of registration on 26.06.2001. The other trademarks of the plaintiff are dated after the year 2002 i.e. after the date of filing of the suit. As per the case of the plaintiff the defendant no. 2 is manufacturing Cera Tiles in the name of ORIENT on or before the filing of the suit. Thereby the case of the plaintiff falls under category of passing off mark ORIENT with the plaintiff and not the infringement of trademark in favour of plaintiff bearing date of registration as 01.08.2005. The evidence of plaintiff is unrebutted and unimpeached which is found reliable and consistent. In such circumstances of the case it is held that the defendants have violated the trademark of the plaintiff which is ORIENT and thereby liable for passing off as defendants have passed their goods in the same name of the trademark of the plaintiff which is so marketed and developed by the plaintiff at national level. The turn over is running into crores of rupees per year. Accordingly, present issue is decided in favour of plaintiff and against the defendants. Both the defendants and their agents are restrained by way of permanent injunction from passing off of the trademark ORIENT and its infringement in copyright by way of manufacturing, exporting, selling, exhibiting etc. in the said name.
ISSUE NO. 2Whether plaintiff is entitled to mandatory injunction against defendants and their agents as to delivery of labels, blocks, dies, strips, cartons, stationery, literature or any other printing material bearing impugned trademark and copyright and for their destruction/erasure? OPP
15. The findings under issue no. 1 above are equally applicable to the present issue which are not repeated herein for the sake of brevity which be read as part and parcel of present issue. Since it is already held that both the defendants have passed off their goods in the trademark of the plaintiff by the mark ORIENT, therefore, both the defendants has no rights in use of such trademark and copyright of the plaintiff and thereby plaintiff is held entitled to mandatory injunction against both the defendants. Accordingly, present issue is decided in favour of plaintiff and against both the defendants in that injunction in the nature of mandatory injunction. Hereby issued against both the defendants and their agents as to delivery of labels, blocks, dies, strips, cartons, stationery, literature or any other printing material bearing impugned trademark and copyright and for their destruction/erasure. Such delivery be made to the plaintiff of the impugned articles within one month of the date of pronouncement of present judgment.
ISSUE NO. 3Whether plaintiff is entitled to damages for a sum of Rs.10 lakhs against both the defendants for such infringement of trademark and copyright of mark Orient? OPP
16. The findings under issue no. 1 above are equally applicable to the present issue which are not repeated herein for the sake of brevity and be read as part and parcel of present issue. Since it is already held that both the defendants have passed off their goods in the trademark of the plaintiff by the mark ORIENT, therefore, both the defendants has no rights in use of such trademark and copyright of the plaintiff and thereby plaintiff is held entitled to damages against both the defendants. The plaintiff must show that he is entitled to such damages.
17. Plaintiff has relied on citation titled as Time Incorporated v. Lokesh Srivastava & Anr. 2005 (30) PTC 3 (Del) wherein at para no. 8 is held as under:
"This Court has no hesitation in saying that the time has come when the Courts dealing actions for infringement of trade marks, copy rights, patents etc. should not only grant compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them. In Mathias v. Accor Economy Lodging, Inc., 347 F.3d 672 (7th Cir. 2003) the factors underlying the grant of punitive damages were discussed and it was observed that one function of punitive damages is to relieve the pressure on an overloaded system of criminal justice by providing a civil alternative to criminal prosecution of minor crimes. It was further observed that the award of punitive damages serves the additional purpose of limiting the defendant's ability to profit from its fraud by escaping detection and prosecution. If a tortfeasor is caught only half the time he commits torts, then when he is caught he should be punished twice as heavily in order to make up for the times he gets away. This Court feels that his approach is necessitated further for the reason that it is very difficult for a plaintiff to give proof of actual damages suffered by him as the defendants who indulge in such activities never maintain proper accounts of their transactions since they know that the same are objectionable and unlawful. In the present case, the claim of punitive damages is Rs.5 lacs only which can be safely awarded. Had it been higher even, this court would not have hesitated in awarding the same. This Court is of the view that the punitive damages should be really punitive and not flee bite and quantum thereof should depend upon the flagrancy of infringement."
18. The plaintiff has further relied on citation titled as The Heels v. V.K. Abrol & Anr. CS (OS) No. 1385 of 2005 decided on 29.03.2006 wherein at para no. 11 is held as under:
"This court has taken a view that where a defendant deliberately stays away from the proceedings with the result that an enquiry into the accounts of the defendant for determination of damages cannot take place, the plaintiff cannot be deprived of the claim for damages as that would amount to a premium on the conduct of such defendant. The result would be that parties who appear before the court and contest the matter would be liable for damages while the parties who choose to stay away from the court after having infringed the right of the plaintiff, would go scotfree. This position cannot be acceptable."
19. After perusal of the above citations and the facts of the present case it is noted that the plaintiff came to know about such violation of his copyright by the defendants and the defendants have admitted in their WS that they are using the above trademark ORIENT since the year 1995. Plaintiff could have shown its figure of net profit made from the year 1995 till the date of filing of the present suit. In absence of the same and in circumstances of the present case the total damages are awarded in favour of the plaintiff and against both the defendants for a sum of Rs.2 lakhs out of which Rs.One Lakh are in the nature of compensatory damage and Rs.One Lakh are in the nature of punitive damage. Keeping in view the amount of business being done by the plaintiff in the said period as shown on record and in evidence. Accordingly, the present issue is decided in favour of plaintiff and against both the defendants.
RELIEF
20. Suit of the plaintiff is decreed with relief of permanent injunction is granted to the plaintiff against both the defendants and its agents who are restrained in passing off goods in the trademark and copyright ORIENT and its infringement of trademark and copyright by way of manufacturing, exporting, selling, exhibiting etc. in the said name. Relief of mandatory injunction is hereby issued against both the defendants and their agents as to delivery of labels, blocks, dies, strips, cartons, stationery, literature or any other printing material bearing impugned trademark and copyright and for their such destruction/erasure. Such delivery be made to the plaintiff of the impugned articles within one month of the date of pronouncement of present judgment. Damages are awarded in favour of the plaintiff and against both the defendants for a sum of Rs.2 lakhs. Rs.One Lakh of which are in the nature of compensatory damage and Rs.One Lakh are in the nature of punitive damage. Decree sheet be prepared accordingly.
File be consigned to the record room.
Announced in the open court on 4th January 2018 (JOGINDER PRAKASH NAHAR) ADDL. DISTRICT JUDGE-04 CENTRAL/TIS HAZARI COURT/DELHI