Madras High Court
S.V.S. Oil Mills vs S.V.S. Agro Refineries P. Ltd. And Anr. on 27 June, 2001
Equivalent citations: 2002(24)PTC41(MAD)
Author: A. Kulasekaran
Bench: A. Kulasekaran
JUDGMENT A. Kulasekaran, J.
1. This application for interim injunction in O.A. No. 505 of 2001 in C.S. No. 435 of 2001 is filed to restrain the respondents from manufacturing, marketing, advertising in all media including electronic media, either as domain name or as website use the expression S.V.S. either as prefix or suffix and pass off their edible oil of any kind and Vanaspathi as the goods of the plaintiffs edible oil and Vanaspathi or enable others to pass off their goods and business as that of applicants.
2. The applicant's case is briefly as follows;-
Originally, the applicant firm was consisting of 7 partners Sivalingam Nadar, S.V. Harikrishnan, S.V. Chandrapandian, S.V. Kasilingam, S.V. Ramachandran, S.V. Nalesan and Smt. Kanthimathi Ammal. All are sons and daughters of Late. Velayutha Perumal Nadar. They have been manufacturing and marketing edible oil in the name and style of S.V.S. Oil Mills. In the course of business, they adopted three letters in a distinctive style S.V.S., the name of the firm and its trademark with an inverted triangle device and was used extensively all over India. On 20-04-1982, Smt. Gandhimathi Ammal retired and a fresh partnership under a deed dated 25-11-1982 was formed. In the meanwhile, to settle the disputes, they referred the matter to an Arbitrator by letter dated 08-10-1981 and arbitrator passed an award on 09-07-1984 thereby allowed the business of S.V.S. Oil Mills to S.V. Chandra Pandian, S.V. Kasilingam, S.V. Ramachandran and S.V. Natesan. Immediately, fresh partnership was constituted on 15-07-1984. The award was decreed in application No. 3505/1984 on 17-11-1988 against which O.S.A. No. 191/1991 and 173/1991 were filed by Sivalinga Nadar and the Division Bench set aside the decree on 13-11-1991. The Supreme Court on 11-01-1993 remanded the appeal to the Division Bench and it confirmed the award passed by the learned Single Judge. Again, the Division Bench Judgment was challenged before the Apex Court which confirmed the Judgment dated 27-10-1993 passed by the Division Bench on 19-11-1998. On 22-02-2001, 2nd respondent herein retired from the said partnership and an ascertained amount of Rs. 77,57,248.40 was paid. The 2nd respondent few weeks prior to his retirement started a firm Vigneswara Oil Mills. The 2nd respondent found that there was no demand for his new venture of V.O.M. and clandestinely incorporated a company S.V.S. Oil Agro Refineries (P) Ltd. and started approaching applicant's customers as they are known to him and it is a calculated attempt to exploit the commercial goodwill and trade mark namely S.V.S. The respondents have scheduled to commence the manufacturing activities from 24-06-2001 and circulated invitations extensively. The applicants received a communication from Civil Supplies Department and only after that the applicants came to know that the defendants have filed an application in the name of S.V.S. Agro Refineries Pvt. Ltd. The 2nd respondent has retired from the applicants company after receiving his ascertained amount and he has no locos standi to use the name of S.V.S. The respondents, with a view to paralisc the applicants business and to cheat the consumer public at the cost of the applicant's business and reputation. For the reasons mentioned above, they sought for an injunction.
3. The respondents' case is briefly as follows:
The 2nd respondent's son filed the counter in the capacity of director of first respondent company on behalf of the company and the respondent. The allegations in it are as follows:-
The partners in the applicant firm are his maternal Uncles and his father, the 2nd respondent retired from the applicant's firm with effect from 30-11-2000 by executing necessary deed dated 22-02-2001. Originally, applicant's firm was consisting of six sons and one daughter of Late. Sudalaimada Velayutha Perumal. All the six brothers have been collectively called as SVS in the trade circle. SVS is the abbreviated form of Sudalaimada Velayutha Perumal Sons and adopted SVS in the year 1968 as a trade name for their oil business under the name and style of SVS Oil Mills. In the year 1973, the SVS Oil Mills filed a trade mark application for the said three letters SVS inscribed thereon with a invented triangle device as label mark, which was granted with a condition of disclaimer imposed Under Section 17 of Trade and Merchandise Marks Act; that the applicant should not claim exclusive right over the three letters SVS. Disputes arose in the firm during 1981, referred to the Arbitrators, who passed the award dated 09-07-1984 allotting the business of SVS Oil Mills to the last four brothers i.e., partners of the applicant and the second respondent herein. The said award was confirmed ultimately by the Supreme Court. Under Clause 27 of the said award, the said four persons are entitled to use the name SVS Oil Mills only but not the letter per se alone. One of the sons of Sudalaimada Velayutha Perumal Mr. S.V. Sivalinga Nadar and S.V. Harikrishnan Nadar started to freely use the letters SVS in their edible oil trade and other business. One suit in CS. No. 1016 of 1987 was filed by applicants against the said Sivalinga Nadar which was dismissed as withdrawn. The amount of Rs. 77,57,248.40 received by the 2nd respondent is not inclusive of the share in goodwill or label SVS. A notice dated 25.05.2001 was issued by the 2nd respondent claiming 1/4th share in the goodwill of the label, to forestall the said claim the present suit and applications are filed by the applicant. The colour combination of the label, get up, the placement of family letters SVS are distinctive form that of applicant as such no confusion or deception arise in the market. Under Section 34 of the Act, the respondents are entitled to seek protection. The name mentioned in the section is wider in sense to include the family name, personal name and surname.
4. Learned Senior Counsel for the applicant, Mr. C.A. Sundaram brought to the notice of this Court the retirement deed dated 22-02-2001. It is categorically stated in the said deed that all parties were carrying on partnership business in the name and style of S.V.S. Oil Mills in and by a Deed of Partnership dated 15-07-1984 and 01-04-1999. The 2nd respondent expressed his desire to retire from the partnership firm as per Clauses 13 and 14 of the deed of partnership allowing the other partners to continue the partnership firm S.V.S. Oil Mills. The condition No. 1 of the said deed of retirement says that on 30-11-2001, the 2nd respondent retires and the continuing partners, at their full liberty to continue and carry on business of the said firm for their own benefits with all its assets and liabilities and from 01-12-2001. In condition No. 3, it is stated that the retiring partner has no right, title, interest, leasehold, advantage or claim in the business or in the immovable assets of the firm S.V.S. Oil, both tangible and intangible and agreed that the continuing partners to hold the same absolutely. In condition No. 4, it is stated that the continuing partners have paid a sum of Rs. 77,57,248.40 to the 2nd respondent. In condition No. 7, it is mentioned that to enable the continuing partners to receive the properties of partnership assets, benefits and advantages the retiring partner hereby irrevocably appoints the continuing partners as his lawful attorney to sue for, recover and to sign and pass on receipts. The last limb of the said condition states that the retiring partner will not in any way affect the pending proceedings before the various forums and the outgoing partner shall personally undertake not to take any act which will adversely affect the interest of the continuing partners of the Firm. The learned Senior Counsel appearing for the applicants has pointed out from the order dated 05-02-2001 passed by the Joint Registrar of Trade Marks. The said order dated 05-02-2001 was passed on a petition dated 12-11-1999 filed by S.V.S. Oil Mills i.e., the applicant herein. The said application was filed by the present partners of the applicant's firm and erstwhile partner namely the second respondent herein. In Para No. 3 of the said order the averments of applicants are extracted as follows. "As is apparent from the cumulative effect of Clauses 12 & 27 of the award and current assets and liabilities of S.V.S. Oil Mills and its name were allotted to S.V. Chandrapandian, S.V. Kasilingam, S.V. Ramachandran and S.V. Natesan." In Paragraph No. 4 which says that "it was alleged that this firm is using the registered trade mark S.V.S. continuously along with the goodwill of previous firm registered on 24-03-1969." The said passage is pointed out to show the trademark S.V.S. is being used by the newly constituted firm namely S.V.S. Oil Mills wherein the 2nd respondent was also one of the partners and later retired. Similarly, Paragraph No. 7, which says that "The Arbitrators passed the said award on 09-07-1984 directing the four joint Proprietors to take over the assets and liabilities of the firm S.V.S. Oil Mills with a right to use the expression S.V.S, with effect from 14-07-1984. S.V. Sivalinga Nadar and his sons since were party to the arbitration proceedings and also knew that the expression S.V.S. which is the main and prominent features of the mark of which they are seeking registration is part of the award and the same was allowed to the four brothers as Joint Proprietors and constitution of the new firm....". In para No. 8 it is stated that "despite the above S.V. Sivalinga Nadar and Sons started using the expression S.V.S. in respect of the edible oil under the name and style of S.V.S. and Sons. The four Joint Proprietors of the firm filed C.S. No. 1016 of 1987 on the file of this Court for permanent injunction on account of the infringement and passing off restraining S.V. Sivalinga Nadar and Sons from using the expression S.V.S.....". The learned counsel submits that the above extracts would show that the trade mark S.V.S. had been used only by the firm and not by any individual. The learned counsel for the applicant stated that the respondent planned to commence their business on 24-06-2001 and make elaborate arrangements by adopting the trade mark S.V.S. The learned counsel also argued that the suit C.S. No. 1016/1987 was withdrawn on 24-02-1997 by making necessary endorsements since the case pertaining to the award for the arbitration is pending before the Supreme Court. Further, the applicant reserved his right to file similar case on the same cause of action against the defendants and this court also granted such a liberty to file a fresh suit on the same cause of action and also give the right to the defendants to raise all the defence that are open to them. The learned counsel also informed this Court that the applicant herein is taking necessary steps to file similar case against the said Sivalinga Nadar.
5. The learned Senior Counsel for the respondents Mr. K. Alagirisamy demonstrated that the retirement deed itself is evident to show that the 2nd respondent has every right to use the business name S.V.S. The learned counsel argued that the applicant herein cannot claim exclusive right in the letter S.V.S. As a disclaimer, under Section 17, the applicant is not entitled to claim exclusive right in the letter S.V.S. One of the brothers namely Mr. Sivalinga Nadar has been using the letter S.V.S. in his oil business and the copy of the same is filed in the typeset of the respondent. The learned counsel argued that applicant herein has not objected to using of the said letter S.V.S. by Sivalinga Nadar since it is the family name and as such objecting the respondents from using the said name is not sustainable in law besides unreasonable. In the previous suit, C.S. No. 1016 of 1987 filed by the applicant against the said Sivalinga Nadar for using the family letter S.V.S. was dismissed. The adoption of the family letter S.V.S. by the respondents along with a different and distinctive circle interwoven with the star device in the background for their label is bona fide. The retirement benefits received by the respondents is exclusive of goodwill of the registered trademark S.V.S. The learned Senior Counsel also pointed out Under Section 34 of the Act that the respondents are entitled to seek protection since the name S.V.S. is a family name. The learned Senior Counsel also pointed out Clause 27 of the Arbitration Award to support the case of the respondents which is as follows:-
"Disputants 3, 4, 5, and 6 shall be entitled to use the name of S.V.S. Oil Mills as it is represented to us that S.V.S. represents S. Velayutha Perumal Sons.
The said Velayutha Perumal representing the name of the father of the disputants."
The senior counsel for the respondent brought to the notice of this Court on Interlocutory Application dated 04-05-2001 filed before the Registrar of Trademark at Mumbai wherein it was mentioned that the second respondent herein has not relinquished their right under the said trademark and still considered to be a registered Proprietor of the said trademark. The learned counsel has also produced a copy of the Judgment in C.S. No. 1017/1987 dated 20-024997 wherein the applicant's company has withdrawn the suit with a liberty to file a fresh suit on the same cause of action against Sivalinga Nadar and Sons to show that the applicant herein was aware that he could not claim exclusive right in the trade mark and also pointed out that the respondents are entitled to use the trade mark S.V.S. since the same is the family letter. In order to forestall the claim of the share of the respondents in the trade mark and the goodwill, the suit and applications were filed by the petitioner herein. It is the case of the second respondent that the amount received is not inclusive of goodwill of S.V.S. In the year 1973, S.V.S. Oil Mills filed one trademark application with the said three letters S.V.S. inscribed thereon with an inverted triangle device and the registration was granted with a condition as defined under Section 17 of the Trade and Merchandise Marks Act that the applicants should not claim exclusive right over the three letters. The letters S.V.S. represents S. Velayuthaperumal Sons. The name Velayuthaperumal represents the name of the father of applicant's partners and 2nd respondent. Other than the parties herein, some other persons have also freely using the family letters S.V.S. in their edible oil business for the past 15 years. No Civil Court has passed any Prohibitory Order against the usage of the family name S.V.S. At the time of retirement of 2nd respondent, the goodwill of the applicant firm, label mark S.V.S. were not valued and paid and therefore this respondent has sent a notice dated 25-05-2001 claiming 1/4th share in the goodwill of the label trademark S.V.S. The suit is a counter blast to the said notice dated 25.05.2001. The applicant has sent reply dt. 15.06.2001 that the letter S.V.S. could not be used in business. That the 2nd respondent is entitled to use the plaintiffs device but he has not done so, but he adopted the family letter S.V.S. along with a different and distinctive circle device. The colour combination of the respondents label, getup, placement of family letter S.V.S. and its appearance are all distinctive from the applicants and as such no confusion will arise in the mark. Before the filing the suit, the applicant also filed a complaint under Section 27 of the Act for adopting the family letter S.V.S. by the respondent company, which is still pending before the Registrar of Companies.
6. The point for consideration is whether the applicant is entitled to interim injunction restraining the respondents from passing off or not?
Admitted facts in this case are as follows:-
* Applicant firm's present partners and the second respondent are brothers.
* In the year 1973, SVS Oil Mills has obtained a registration under trade mark No. 285501 - B with a condition of disclaimer imposed under Section 17 of the Act.
* Arbitration award dated 09-07-1984 was passed thereby the business of SVS Oil Mills was allotted to the last four brothers including the second respondent herein, which was ultimately confirmed by the Hon'ble Apex Court.
* Partnership deeds dated 15-074984 and 01-04-1999 were entered into between four brothers * Retirement deed was signed on 22-02-2001 with effect from 30-11-2000 by the second respondent.
7. The learned Senior Counsel appearing for the applicant relied upon a Judgment (Registrar of Trade Mark v. Ashok Chandra Rakhit Ltd.) wherein it is held that even the disclaimer is entitled to injunction, Paragraph Nos. 8 and 9 which are extracted below:-
"(8) The third thing to note is that the avowed purpose of the section is not to confer any direct benefit on the rival traders or the general public but to define the rights of the Proprietor under the registration. The registration of a trade mark confers substantial advantages on its Proprietor as will appear from the sections grouped together in Chapter IV under the heading "Effect of Registration". It is, however, a notorious fact that there is a tendency on the part of some Proprietors to get the operation of their trade marks expanded beyond their legitimate bounds. An illustration of an attempt of this is to be found in - 're Smokeless Power Co.'s Trade Mark', 1892-1 Ch 500 (F).
Temptation has even led some Proprietors to make an exaggerated claim to the exclusive use of parts or matters contained in their trade marks in spite of the fact that they had expressly disclaimed the exclusive use of those parts or matters. Reference may be made to-'Geers Ltd. v. Pearman Corder Ltd' 1922 (39) RPC 406 (G), commonly called the Banquet Case. The real purpose of requiring a disclaimer is to define the rights of the Proprietor under the registration so as to minimize, even if it cannot wholly eliminate the possibility of extravagant and unauthorized claims being made on the score of registration of the trade marks.
(9) The last feature of the section is its proviso. That proviso preserves intact any right which the Proprietor may otherwise under any other law have in relation to the mark or any part thereof. The disclaimer is only for the purposes of the Act. It does not affect the rights of the Proprietor except such as arise out of registration. That is to say, the special advantages which the Act gives to the proprietor by reason of the registration of his trade mark do not extend do the parts or matters which he disclaims. In short, the disclaimed parts or matters are not within the protection of the statute. That circumstance, however, does not mean that the Proprietor's rights, if any, with respect to those parts or matters would not be protected otherwise than under the Act. If the Proprietor has acquired any right by long user of those parts or matters in connection with goods manufactured or sold by him or otherwise in relation to his trade, he may, on proof of the necessary facts, present an infringement of his rights by a passing off action or a prosecution under the Indian Penal Code. Disclaimer does not affect those rights in any way."
The learned counsel for the Petitioner further relied on a Judgment reported in 1990 PTC 240 of our High Court (R. Paneerselvam v. Mohammed Rafi...) In that case, the defendant trade mark being deceptively similar to that of the plaintiff's trade mark, visually and phonetically, the plaintiff is entitled for an injunction as prayed for pending disposal of the suit even regarding a threatened breach of a registered trade mark. The relevant portions in para 8 are extracted hereunder.
"There is another ground for holding that the Court has jurisdiction. Section 20 of the Code of Civil Procedure shows that a suit like the present suit can be filed wherever the cause of action wholly or partly arises. The Plaintiff has prayed for an injunction regarding a threatened breach of a registered trade mark. The learned Single Judge held that the Delhi Court does not have jurisdiction on the ground of any sale having been made in Delhi, but does have jurisdiction on account of the advertisement having appeared in the trade marks journal. The real point which gives the Court jurisdiction is not the place where the advertisement has appeared, but the fact that the trade mark is sought for sale in Delhi amongst other places. Furthermore, when an injunction is sought, it is not necessary that the threat should have become a reality before the injunction and it can even he sought for a threat that is still to materialize.
As injunction being prohibitive in nature is intended to prevent something that is likely to happen. Once the plaintiffs have learnt that the defendants have applied for registration of trade mark in Delhi, they can claim an injunction to prevent any sale of the infringing produce in Delhi. In this sense, the Court will have jurisdiction whether any sale in Delhi has taken place or not. In any case, as already stated, the decision is of preliminary nature; once the exact scope of what the defendants intend to do is known, it is open to the Court to return the plaint. In that sense, it is not a final decision and is not open to appeal at the preliminary stage being not a final adjudication."
The learned Senior Counsel for applicant argued that once the second respondent retired from the applicant partnership firm, the applicant/the continuing partners at their full liberty to continue and carry on business with all assets and liabilities both tangible and intangible. The learned counsel pointed out condition No. 3 of the retirement deed to show that the second respondent has no right, title, interest, leasehold or advantages or claim in the business.
The learned counsel has also drawn the attention of this Court to 2000 PTC 324 (Manohar Singh Chadda v. Sheetal Sweets). This is a case relating to passing off, the name which was used by the erstwhile partners and the Court found that the suit is filed in time, besides granting injunction as prayed for. The relevant portions are extracted hereunder.
"The name under which persons transact business is definitely one of the most important concomitant of goodwill Black's Law Dictionary "Goodwill" inter alia as "Inclusive of every advantage, every positive advantage, that has been acquired by a proprietor in carrying on his business, whether connected with the premises in which the business is conducted, or with the name under which it is managed, or with any other matter carrying with it benefit of the business, or with the name under which it is managed. Shorn of legal asoteries the first idea or thought which would arise in the mind of any businessman in relation to the partnership, therefore, prima facie, he must have known that the plaintiff would be entitled to use the firm name thence forward even in the absence of Dissolution Deeds. I am satisfied that a prima facie case has been shown by the plaintiff against the retired partner/defendant for the issuance of an injunction restraining the latter from using or business in the name of the erstwhile firm. The burden would heavily lie on the retiring partner to establish that it was clearly and specifically understood that he would be permitted to start a fresh competing business conclusively or even preponderantly discharged, at least at the stage."
The learned Senior Counsel for the applicant relied on the partnership deed dated 15-07-1984 and 01-04-1999 and Joint Registrar of Trade Mark's order dated 05-02-1921 to show that the name SVS is not a family name but is only a trade name and the applicant firm is vested with exclusive right as admitted by the second respondent in an application filed along with other partners that firm is the owner of the name SVS and not any individual. The respondents are not entitled to any protection Under Section 34 of the Act in this case in virtue of document i.e. order dated 05-02-1921 of Joint Registrar Trade Mark.
The learned Counsel for the appellant also relied on another Judgment reported in 1982 PTC 297 (Surjeet Book Depot v. Surjeet Book Depot (P) Ltd., and Anr.). In this case, it was held that since the name happens to be Surjeet Singh, he cannot be prevented from using his name in his business in view of the provisions contained Section 34 of the Trade and Merchandise Marks Act, the Court negatived the contention of the defendant and granted injunction sought for by the Plaintiff. The facts mentioned in this case is squarely identical to the present case on hand.
The learned Senior Counsel for the applicant relied upon (Suraj Electrical Limited, Bombay v. Metals & Allied Products Bombay and Anr.) wherein the Division Bench held that the question for determination was whether the defendants are guilty of passing off any of infringement of the trade mark on the ground that user of family name as trade name, the Court held that the plaintiff was entitled to interim injunction as prayed for. The defendants were using the family name a trading style but as a trade mark or trade sign and such user is not permissible. The Court further held that damages suffered by the plaintiff cannot be ignored and actual sufferance of damage cannot be established on the date of institution of suit.
The learned Senior Counsel for applicant made reliance on (K.R. Chinna Krishna Chettiar v. Sri Ambal & Co.,) wherein it is held that whether the proposed trade mark is used in a normal and fair manner and if similarly fair and normal user is assumed of the existing registered marks, will there be such a likelihood of deception that the proposed mark ought not to be allowed to be registered is a question which has to be decided on a comparison of the competing works as a whole and their distinctive and essential features. When a dealer sells snuff under a registered trade mark and the word "Ambal" is the distinctive and essential feature of the trade mark and that word fixes itself in the recollection of an average buyer with imperfect recollection of an average buyer with imperfect recollection, another dealer also dealing in snuff cannot be allowed to get the trade mark registered, of which the word "Andal" is a distinguishing feature as there is a striking similarity between the words "Ambal" and "Andal". The Court further held that mainly because of distinctive use in both the marks, it cannot be said that the resemblance does not lead to confusion when it is likely that majority of the customers are not able to understand the distinction between the meaning of the two words. It is further held that the resemblance between the two marks must be considered with reference to the ear as well as the eye and ocular comparison is not always the decisive test. The learned counsel relying upon this states that when a customer approaches a shopkeeper and demand S.V.S. Oil, it will definitely create a confusion in the mind of the shopkeeper as well as the customer while delivering it or receiving it since it is not possible to mention the distinctiveness of a particular oil by both of them. Hence, it will cause confusion in the minds of both of them.
8. The learned Senior Counsel for applicant pointed out AIR 1985 Delhi - Page No. 211, which is a case where the Plaintiffs cycle Bell as under the trade mark B.K. and the Defendant used the trade mark BK81 for his cycle bell, the Court held that the defendant's mark receptively similar and is likely to cause confusion in the mind of the general public. An injunction was granted restraining the defendant from using the said mark.
The learned Senior Counsel for the respondent relied on Judgment reported in 1994 Supp (3) SCC 215 (Jayakapoor v. Micronix India), wherein it was held that the name of Microtel and Micronix used in respect of Electronic and electrical apparatus microchip technology being the base of many of the products, no one could claim monopoly when there being no phonetic or visual resemblance between the words "tel" and "nix" used by such products are not likely to be misguided or confused. Interim injunction granted by the High Court was set aside. This judgment is not useful to the respondent. .
The learned Senior Counsel for the respondent relied upon a Judgment (S.M. Dyechem Ltd. v. Cadbuiy (India) Ltd.) and the relevant portions are extracted below:-
"37. The first question therefore is as to what, on the facts, are the essential features of the plaintiff's mark? It is clear that apart from the word PIKNIK, the essential features are also the special script of these words in block letters and the curve in which these words are inscribed and the caricature of the boy with a hat occurring between the words (sic) "K" and "N" on the plaintiff's mark. On the other hand, the defendant's mark contains the word PICNIC in a straight line, the script is normal and the word "Cadbury" is written above the word PICNIC. Neither the peculiar script nor the curve not the boy with a hat are found in the defendant's mark. It is true that there is phonetic similarity and (sic in) use of the PICNIC. But what is the effect of the dissimilarities?"
48. Here the point is in relation to relative strength of the parties on the question of "passing off". As discussed under Point 5, the proof of resemblance or similarity in case of passing off and infringement are different. In a passing off action, additions, get-up, or trade dress might be relevant to enable the defendant to escape. In infringement cases, such facts do not assume relevance.
49. It is possible that, on the same facts, a suit for passing off may fail but a suit for infringement may succeeded because the additions, the get up and trade dress may enable a defendant to escape in a passing off action. A some what similar but interesting situation arose in a dispute between two companies. In National Sewing Thread Co. Ltd. v. James Chadwick & Bros. Ltd., the passing off action failed. But thereafter, in James Chadwick Co., succeed in an appeal arising out of the registration proceedings and the said Judgment was confirmed by this Court in National Sewing Thread Co. Ltd. v. James Chadwick & Bros. Ltd. It was held that the judgment in the passing off case could not be relied upon by the Opposite side in latter registration proceedings.
50. In the same tone, Halsbury says that in a passing off action, the degree of similarity of the name, mark or other features concerned is important but not necessarily decisive, so that an action for infringement of a registered trade mark may succeed on the same facts where a passing off action fails or vice versa".
The abovesaid Judgment was subsequently overruled by the Hon'ble Supreme Court (Cadila Health Cure Limited v. Cadila Pharmaceuticals Limited) pointing out that need not go into the question of comparable strength and the relevant Paragraphs are extracted hereunder:-
"17. Our attention was drawn to a recent Judgment of this Court in S.M. Dyechem Ltd. v. Cadbury (India) Ltd., where in a passing off action, the plaintiff, which was carrying on the business under the mark PIKNIK filed a suit for injunction against the defendant which was using the mark of PICNIC for some other chocolates sold by it. On the allegation that the defendant's mark was deceptively similar, the trial court had issued an injunction which was reversed by the High Court, On appeal, the decision of the High Court was affirmed. One of the questions, which this Court considered was that for grant of temporary injunction should the Court go by the principle of prima facie case, apart from balance of convenience, or comparative strength of the case of either parties or by giving finding out if the plaintiff has raised a "triable issue". While considering various decisions on the point in issue, this Court rightly concluded at Page 591 as follows. "Therefore in trade mark matters, it is now necessary to go into the question of comparable strength of the cases either partly, apart from balance of convenience.
On merits of the case, this Court took note of some English decisions and observed 'in Dyechem's case at page 594 that where common marks are included in the rival trademarks, more regard is to be paid to the parts not common and the proper course is to look at the marks as a whole, but at the same time not to disregard the parts which are common. This Court sought to apply the principle that dissimilarity in essential features in devices and composite marks are more important than some similarity. Broadly, under our law as seen above, it can be said that stress is laid down on common features rather than on differences in essential features, except for a passing reference to a limited extent in one case. It appears to us that this Court did not have occasion to decide, as far as we are able to see, an issue where there were also differences in essential features nor to consider the extent to which the differences are to be given importance over similarities. Such a question has arisen in the present case and that is why we have referred to the principles of English Law relating to differences in essential features which principles, in our opinion, are equally applicable in our country"
18. We are unable to agree with the aforesaid observations in Dyechem's case (supra). As far as this Court is concerned, the decisions in the last four decades have clearly laid down that what has to be seen in the case of a passing off action is the similarity between the competing marks and to determine whether there is likelihood of deception or causing confusion. This is evident from the decisions of this Court in National Sewing Thread Co. Ltd., etc., Having come to the conclusion, in our opinion incorrectly, that the difference in essential features is relevant, this Court in Dyechem's case sought to examine the difference in the two marks Piknic and Picnic. It applied three tests they being (1) is there any special aspect of the common feature which has been copied (2) mode in which the parts are put together differently i.e., whether dissimilarity of the part of parts is enough to make the whole thing dissimilar and (3) whether when there are common elements, should one not pay more regard to the parts which are not common, while at the same time not disregarding the common parts? In examining the parts, keeping the aforesaid three tests in mind, it came to the conclusion, seeing the manner in which the two words were written and the peculiarity of the script and concluded that the above three dissimilarities have to be given more importance than the phonetic similarity or the similarity in the use of the word PICNIC and PIKNIK.
20 ......These observations appear to us to be contrary to the decision of this Court in Amritdhara's case where it was observed that the products will be purchased by both villagers and townfolk, literate as well as illiterate and the question has to be approached from the point of view of a man of average intelligence and imperfect recollection. A trade may relate to goods largely sold to illiterate or badly educated persons. The purchaser in India cannot be equated with a purchaser of goods in England. While we agree that in trademark matters, it is necessary to go into the question of comparable strength, the decision on merits in Dyechem's case does not, in our opinion lay down correct law and we hold accordingly."
9. The trade name adopted by the respondent is identical, though some, slight modification, not materially altering its essential feature. Similarity between the competing marks causes deception and confusion in the minds of the purchaser. The applicant is long user of the trade mark SVS and acquired reputation for their goods all over the State and their turn over is several crores, no bona fide or valid explanation is offered by the respondents for choosing the same trade name in respect of identical goods. Withholding of an injunction likely result in damages to the applicant herein or to the reputation or goodwill since the business is being continuously carried for several decades, certainly the applicant is entitled to an injunction. The case of the applicant is that their products are identified in the market by the trade name of SVS.
While so, the proposed activities or the activities of the respondent to bring identical goods under the trade name of SVS would definitely create confusion in the minds of the purchasers since the applicant's products are purchased by both villagers and town-folks literate as well as illiterate. When the applicant has come to know the defendants made extensive arrangements to use the applicant's trade name, certainly, the applicant is entitled to an injunction nevertheless the sales taken place or not.
10. The applicant herein has made out a prima case and also proved that the balance of convenience is in his favour. The injunction sought for is absolutely necessary otherwise the applicant would be put to irreparable loss and hardship. Hence, the application deserves to be allowed.
11. In the result, the application is allowed as prayed for. No costs.