Delhi High Court
M/S Saurabh Agrotech Private Limited vs Radhey Shyam Agencies on 22 April, 2016
Author: Manmohan Singh
Bench: Manmohan Singh
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment Reserved on: 4th January, 2016
Judgment Pronounced on: 22nd April, 2016
+ I.A. No.23526/2015 in CS(OS) No.3341/2015
M/S SAURABH AGROTECH PRIVATE LIMITED ..... Plaintiff
Through: Mr.Rajiv Nayar and Mr.Sandeep
Sethi, Sr.Advs. with Mr.Rajendra
Bhansali, Mr.Harshit Tolia, Mr.Sitesh
Singh & Mr.Umar Khan, Advs.
Versus
1. RADHEY SHYAM AGENCIES,
2. VIJAY SOLVEX LIMITED,
3. M/S RAGHUVAR (INDIA) LTD. ..... Defendants
Through: Dr.Abhishek Manu Singhvi, Sr.Adv.
with Mr.Narendra M. Sharma,
Mr.Ankur Sood, Ms.Prachi Johri,
Ms.Prachi Gupta & Mr.Shoumendu
Mukherjee, Advs. for D-2 & 3.
Mr.Akshay Ringe, Adv. for D-1.
CORAM:
HON'BLE MR.JUSTICE MANMOHAN SINGH
MANMOHAN SINGH, J.
1. By way of this order, I propose to decide the pending application being I.A. No.23526/2015 filed by the plaintiff under Order XXXIX Rules 1 and 2 read with Section 151 of CPC.
2. The plaintiff, M/s Saurabh Agrotech Private Limited has filed the suit for permanent injunction, infringement of the trademark, infringement of the CS(OS) No.3341/2015 Page 1 of 45 copyright, passing off, damages, rendition of accounts and delivery up etc. against the three defendants namely, Radhey Shyam Agencies, Vijay Solvex Limited and M/s Raghuvar (India) Ltd.
3. Brief facts of the case as per the plaint are:-
(i) The plaintiff-Company came to be incorporated in August, 1994. It is engaged in the business of manufacturing, marketing and selling all kinds of edible oil, oil cakes, vegetable ghee and allied goods.
(ii) In the year 1975, one M/s Rohtash Industries Limited, Times House, 4th Floor, 7, Bahadurshah Zafar Marg, New Delhi-110002 adopted and started using the said trademark ASHOKA in relation to goods in question viz. edible oil, oil cakes, vegetable ghee, and allied goods and business of manufacturing and marketing edible oils and used the same continuously and in the course of trade. The said trademark ASHOKA got registered under registration No.354173 as of 5th October, 1979 in Class 29.
(iii) The said referred Company sold its entire business of edible oil as a going concern including the trademark ASHOKA to defendant No.3 by agreement dated 31st July, 1984. The application on Form TM-24 for change of entry was filed on 23rd March, 1988 in the Trade Mark Registry by the defendant No.3 for entering themselves as assignee, the same was allowed on 5th May, 1988 in the name of defendant No.3. Necessary entry was made in the register of trademarks.
(iv) Due to communication gap between earlier proprietor of the mark and their attorney, the above registration of the trademark vide No.354173 in Class 29 was lapsed as renewal application was not filed in time in the Trademark Registry by its attorney. But the fact remains that the rights on CS(OS) No.3341/2015 Page 2 of 45 trademark were assigned which fact is not disputed by the assignor or assignee.
(v) Subsequently, the plaintiff acquired the rights of proprietorship of the said trademark by way of Assignment dated 7th April, 2008 from M/s.
Raghuvar (India) Ltd./defendant No.3 herein. After having acquired rights, the plaintiff filed the application for the same mark ASHOKA for change of entry in its name on Form TM-16. The defendant No.2 after about two years also filed the objection to the application for registering the assignment. But the plaintiff's application was allowed. The mark was duly registered. After passing the order dated 13th May, 2010 by the Trade Marks Office in favour of the plaintiff, the plaintiff became proprietor of the trademark, which is the subject matter of the present suit, bearing No.1324290 in Class-29 in respect of said goods applied for claiming use since the year 1975. The said application was originally filed by defendant No.3 prior to the date of assignment.
(vi) As the plaintiff apprehended that the defendants are likely to start or has just started infringing the registered trademark ASHOKA of the plaintiff as well as by using the similar label along with the device of a lion and a wheel within the territorial jurisdiction of this Court, therefore the suit is filed.
(vii) It is alleged in the suit that defendant No.2 is attempting to infringe the trademark of the plaintiff and to pass off their goods as of the plaintiff as it is claimed by the said defendant No.2 in the market that they are the permitted user of defendant No.3. Defendant No.1 who is the agent of CS(OS) No.3341/2015 Page 3 of 45 defendant No.2 is selling products of defendant No.2 being permitted user on behalf of the defendant No.3 in Delhi.
(viii) The active Directors in defendants No.2 and 3 are same set of persons. Being the assignee of the mark the defendant No.3 is now trying to use the trademark of the plaintiff through defendant No.2 in illegal manner for which the defendants are not entitled to.
4. It is claimed that the plaintiff's trademark ASHOKA which is being used by the plaintiff either directly or through its predecessor-in-title or licensee, extensively, uninterruptedly, commercially and continuously since the year 1975. The plaintiff is having tremendous reputation in the market. The trademark ASHOKA of the plaintiff has become popular and well known mark in India. The trademark ASHOKA is exclusively associated with the goods of the plaintiff and it connotes and denotes with the plaintiff only. It is stated in the plaint that the defendants might have very recently started using the trademark ASHOKA despite of assignment by defendant No.3. The defendants have copied all the essential features from label of ASHOKA of the plaintiff and they have substantially reproduced the art- work of the label used by them as that of the plaintiff's.
5. It is stated in the plaint that due to said activities of the defendants, the confusion has occurred in the market as many complaints have been received by the plaintiff about the confusion and deception. The plaintiff's are selling their goods in many parts of India. Their goods are also available in the local market of Delhi. The defendants are also trying to enter the market of New Delhi. Therefore, the cause of action of the present suit has arisen within the territorial jurisdiction of this Court.
CS(OS) No.3341/2015 Page 4 of 456. It is submitted that the adoption of the impugned trademark ASHOKA by the defendants is dishonest and ill-motivated in order to create the confusion and deception in the market and to put pressure upon the plaintiff and they are trying to encash the reputation and goodwill of the plaintiff under the trademark ASHOKA in order to make easy money. The defendant No.2 was/is aware about execution of assignment in favour of plaintiff by the defendant No.3 and exclusiveness of proprietorship of the trademark ASHOKA in the name of plaintiff as its Directors, are in relation to each other. Therefore, the adoption/proposed adoption of the impugned trademark by the defendants No.2 and 3 is dishonest. The said adoption of the trademark ASHOKA by the defendants is with a view to cause deception and confusion in the market and to pass off impugned goods and business as that of the plaintiff and thus to divert the consumers, customers, traders, buyers and public at large to its own illegal advantage at the cost of the plaintiff.
In the said Assignment Deed, defendant No.3 has specifically admitted that it would not indulge into any activity which may amount to violation of the rights of the plaintiff with regard to the trademark(s) subject matter of the present suit and subject matter of the above assignment deed dated 7th April, 2008, the trademark ASHOKA belonging to the plaintiff.
7. It is submitted by the plaintiff that the defendants have no right to use the trademark ASHOKA in any manner whatsoever and the defendant No.3 after receiving and acknowledging full consideration in the Assignment Deed dated 7th April, 2008 the defendant No.3-assignor now cannot dispute CS(OS) No.3341/2015 Page 5 of 45 the assignment. The plaintiff by virtue of assignment has become the subsequent proprietor of the trademark.
8. Written statement on behalf of defendants No.2 and 3 has been filed. The following defences are raised by them:-
i. They are the real owners of the suit trademark as the alleged assignment in favour of the plaintiff was not completed, the Assignment Deed was terminated without consideration. No amount was received by the defendant No.3 as mentioned in the Assignment Deed. The defendant No.3 has already filed Civil Suit No.19/2011 before the Court of Additional District and Sessions Judge No.1, Jaipur City, Jaipur inter alia challenging the Deed of Assignment by seeking interim orders restraining the plaintiff from using the suit trademark. The defendants have been using the subject trademark continuously and openly for the last many years within the knowledge of the plaintiff. Thus, the relief claimed is barred by the principles of acquiescence. Even this Court has no territorial jurisdiction to entertain the suit as the plaintiff has its registered office at Rajasthan, similarly the defendant No.2 and 3 have its registered office at Rajasthan. Only the Courts at Rajasthan may have natural jurisdiction in respect of the subject matter of this suit, if the same is maintainable. The defendant No.1 is not an exclusive agent or dealer of the defendant Nos. 2 and 3 as alleged. The plaintiff in order to invoke the territorial jurisdiction of this Court has produced only one invoice. As the other proceedings are pending in courts at Jaipur where issues relating to the suit trademark are under consideration, it CS(OS) No.3341/2015 Page 6 of 45 would have been convenient for the defendants to defend the suit in Rajasthan only.
ii. The issues arising here are directly the subject matter before the Supreme Court and the District Court, Jaipur and cannot be re- agitated in the present court and in the fresh case filed by the plaintiff.
9. It is submitted by the defendant No.2 and 3 that suit is nothing more than forum shopping and the interim relief sought in the present application was earlier sought by the plaintiff in a civil suit bearing No.28 of 2010 before the District and Sessions Judge, Jaipur. The relief sought was considered by the Trial Court in order dated 10th February, 2011, the prayer was partly granted only in respect of assets mentioned in the schedule to the plaint and the companies/partnership firms' account statements and the other prayers made by both the parties were rejected. Both sides filed cross- appeals against the said order before the Rajasthan High Court. Those were disposed of by the Rajasthan High Court's order dated 6 th April, 2015 and there was no interference in the order of the trial Court.
The plaintiff thereafter along with other parties filed SLP (C) No.11870/2015 challenging the Rajasthan High Court's order dated 6 th April, 2015 before the Supreme Court. During the course of hearings on 5th May, 2015 and 8th May, 2015, the relief against the assets of the companies was abandoned before the Supreme Court. It is alleged by defendants No.2 and 3 that the reliefs even for assets were abandoned as confirmed in the affidavit dated 1st September, 2015 filed by Sh. Babu Lal Datta. Therefore, it is alleged by the defendants that by implication, the interim relief vis-à-vis the suit trademark stands abandoned before the Supreme Court. Such relief CS(OS) No.3341/2015 Page 7 of 45 cannot be revived by filing a fresh suit, which is the sole intent and purpose behind the present suit. Thus, the suit is an abuse of process and is liable to be dismissed for that reason alone. It is alleged by defendants No.2 and 3 that the plaintiff has made false statement in the plaint and suppressed material facts, therefore, the plaintiff is not entitled to the relief claimed for, as the plaintiff has incorrectly averred in the plaint that defendant No.1 is the distributor/agent of the defendants No.2 and 3. It has been done in order to create jurisdiction and cause of action before this Court.
The plaintiff has also suppressed the following facts: (i) relief in relation to the subject trademark was already sought by it in Civil Case No.28 of 2010 before the District and Sessions Judge, Jaipur; (ii) the said relief was denied vide order dated 10th February, 2011, which was confirmed by the Rajasthan High Court and (iii) the issue is now before the Supreme Court in SLP (C) No.11870/2015 and the plaintiff has already abandoned any interim relief in respect of the companies (which would include any injunction vis-à-vis the suit trademark). The plaintiff has falsely mentioned that the partition suit filed by it (being, Civil Case No.28 of 2010 before the District and Sessions Judge, Jaipur) is only for partition of "tangible" property, though as per plaint the suit was also for trademarks as well bearing the mark "ASHOKA".
10. It is argued by the defendants that the plaintiff's pleadings before this Court are just opposite to its stand in Civil Suit No.19/2011 before the Court of Additional District and Sessions Judge No.1 Jaipur City, Jaipur. In that suit, the plaintiff has filed a written statement where it is contended that the suit trademark was given to Sh. Babu Lal Data Group in a family settlement CS(OS) No.3341/2015 Page 8 of 45 and in the present suit, it is alleged that the deed of assignment dated 7th April, 2008 was independent transaction.
11. It is alleged by the defendants that the deed of assignment being a part of a larger family settlement. The said admission is missing in the plaint. The issue regarding the family settlement is directly part of Civil Case No.28 of 2010 before the District and Sessions Judge, Jaipur, the plaintiff has excluded these aspects from the present plaint in order to take advantage by filing the separate suit in order to get over the ambit of Civil Case No.28 of 2010 before the District and Sessions Judge, Jaipur.
12. It is also submitted that the plaintiff has wrongly mentioned in the plaint and it has recently learnt about the usage of the suit trademark through M/s. Shiv Shakti Traders, in fact the plaintiff was fully aware about the defendants' continuous and uninterrupted user for the long time as the Directors of plaintiff-Company and the defendants are related and family members. The trade channels of both the parties are the same. Both the parties are operating their business from Alwar, Rajasthan. Both set of the parties are also involved in a series of litigations since 2010. Thus, it is false on the part of the plaintiff to contend that they were not aware of the defendant's use and it is very recently is being used by the defendants. The plaintiff has also not disclosed about litigations in relation to other two pending applications filed in different classes of goods falling in 35 and 39.
13. Lastly, it is submitted by Dr.Abhishek Manu Singhvi, learned Senior counsel appearing on behalf of defendants No.2 & 3 that the defendant No.3 is the real owner of the trademark ASHOKA as the assignment in favour of the plaintiff is already terminated. The rights and obligations arising out of CS(OS) No.3341/2015 Page 9 of 45 the said family settlement are yet to be finalized and unless all disputes about the family settlement are decided finally, the plaintiff cannot claim any rights and ownership in respect of trademark ASHOKA and the ownership of the mark in favour of the plaintiff has become a disputed question. The defendant No.3 had earlier issued a legal notice to the plaintiff wherein it has been alleged that the consideration for the assignment was never paid by the plaintiff. Since the plaintiff did not stop using trademark, despite of termination of assignment deed, left with no option the defendant No.3 filed suit No.19/2011 before the Court of Additional District and Sessions Judge No.1, Jaipur City, Jaipur inter-alia challenging the deed of assignment and seeking orders restraining the present plaintiff from using the suit trademark. In the said suit, the main issues relate to whether there was proper authorization from the defendant No.3 Company for execution of the deed of assignment and whether consideration for the same was ever paid by the plaintiff. The said suit is still pending. The issues which are under consideration before the Court of Additional District and Sessions Judge No.1, (Rajasthan) and in the present suit are same. Even after the assignment deed dated 7th April, 2008, defendant No.3 filed its objections before the Trademarks Registry, but the said objections were not decided properly. The order was passed without hearing nor any reasons were given by the Trade Mark Office, thus, the entry made in the registration of trade mark is liable to be removed.
14. On merit, it is stated that the defendants have been using the trademark and was used by M/s. Rohtash Industries Limited since 1975. The benefit of user and goodwill would come in favour of defendant No.3 who CS(OS) No.3341/2015 Page 10 of 45 acquired the entire edible oil business of M/s. Rohtash Industries Limited by virtue of agreement dated 31st July, 1984. Thereafter, the defendant No.3 has used the trademark independently and regularly except for a brief period and the plaintiff was aware about the said user of the defendant No.3. The present action taken by the plaintiff even otherwise is barred by the principles of acquiescence, delay and latches, thus the plaintiff is not entitled to any injunction.
Assignment of the trade mark ASHOKA
15. Let me first deal with the main issue about the assignment. The execution of Assignment Deed is not denied by defendant No.3. By virtue of the Assignment Deed dated 7th April, 2008, the defendant No.3 assigned all the trademarks of ASHOKA (i.e. registered, pending registration or otherwise) referred above along with all its right, title, proprietorship and goodwill, in favour of plaintiff-Company. The defendant No.3 specifically agreed upon not to use the said trademark or any identical trademark after the above assignment. The Deed of Assignment executed by defendant No.3 speaks for itself that consideration agreed upon between the parties to the Deed of Assignment have also been paid and the same is received by the assignor-defendant No.3. The acknowledgment thereof is mentioned in the Deed of Assignment itself.
The extract of the Assignment Deed is reproduced here as below:-
"DEED OF ASSIGNMENT OF TRADE MARK THIS DEED OF ASSIGNMENT is made on this 07th April, 2008, by M/s Raghuvar (India) Ltd., Station Road, Durgapura, Jaipur-302018 (Rajasthan), through its Director Mr.Vijay Data hereinafter called Assignor (which expression shall include the CS(OS) No.3341/2015 Page 11 of 45 heirs, successors and representatives of the Assignors in favour of M/s Saurabh Agrotech Pvt. Ltd, Registered Office 20, 21 & 22, Old Industrial Area, Alwar (Raj.) through its Director Mr.Babu Lal Data hereinafter called the Assignee (which expression shall include the heirs, successors and representatives of the Assignee.
WHEREAS the Assignor is the owner and proprietor of trade mark ASHOKA (hereinafter referred to as the said trade mark) in relation to Edible Oils, Vanspati, Vanaspati Oil and other allied and related goods (hereinafter referred to as the said goods) and have protected the said trade mark under the provisions of Indian Trade Marks Act, 1999 and details of pending application/trade mark registrations are stated as under-
A. Trade Mark ASHOKA duly registered under No.354173 in class-29.
B. Trade Mark ASHOKA duly applied for registration under No.1314290 in class-29.
C. Trade Mark ASHOKA duly applied for registration under No.1331944 in class-35.
AND WHEREAS the said Assignor has agreed with the said Assignee to assign and transfer to him permanently and forever the exclusive rights, title, interest and all benefits and use the said trade mark for a sum of Rs.1,00,000/- (Rupees One Lac Only) alongwith the goodwill.
NOW THIS DEED OF ASSIGNMENT witnesses that in pursuance of this agreement and the consideration of the said sum of Rs.1,00,000/- (Rupee One Lac only) (paid to the said Assignor by the said Assignee, the receipt whereof the said Assignor hereby acknowledges, the Assignors hereby assigns and transfers permanently and forever all rights, title and interest and all benefits of the aforesaid trade mark. AND the said Assignor hereby covenants with the Assignee, that he will not infringe the use of mark identical with the said trade mark hereby assigned or use another trade mark CS(OS) No.3341/2015 Page 12 of 45 resembling to it as to be likely to deceive or cause confusion in the course of trade in relation to the goods in respect of which the said trade mark exists and in a manner as to render the use of the trade mark and likely to be taken either as being use of and the said trade mark and or to import a reference to the Assignee.
AND THE ASSIGNOR further covenants that he, the Assignors shall at the cost of the Assignee, or any person claiming through him to do or cause to be done any other act, deed or thing as may be required for more perfectly assuring this assignment. IN WITNESS WHEREOF the said Assignor and the Assignee have hereunto assigned and delivered the date and the year above mentioned."
16. The Trade Marks Office by order passed on 13th May, 2010 allowed Application TM-16 filed by the plaintiff and thereby changed the entry of the trademark ASHOKA in favour of the plaintiff. The registration of the trademark as per rules was granted in favour of the plaintiff. The said order was not challenged by defendant No.3. I have been informed that no rectification has been filed by defendant No.3 about the entry in the Register of Trade Marks Office which is in the name of the plaintiff and the plaintiff is now the registered proprietor of the trademark with all its right, title, interest and goodwill continuously with effect from 1975.
17. The Assignment Deed shows the admissions of acknowledgement of the consideration. The entry in the Register is in the name of the plaintiff. The Trade Marks Registry is having the Assignment Deed. It is the only domain of the Trade Marks Registry or the Appellate Board to consider the plea as to whether the same is bad, if any, and the entry made therein is wrong, the Civil Court may have jurisdiction to entertain the suit but the CS(OS) No.3341/2015 Page 13 of 45 jurisdiction only lies with the Authority to cancel the registration, in case the Assignment is bad.
18. Prior to that, the defendant No.3 even on 8th April, 2010 issued notice to plaintiff inter alia admitting that the trademark ASHOKA is assigned to the plaintiff vide Deed of Assignment dated 7th April, 2008, however, its only grievance was that the consideration was not paid.
19. The extracts of the said notice are reproduced here as under:-
"Dear Sir, Under the instruction of my client M/s Raghuvar (India) Limited, having its office at Station Road, Durgapura, Jaipur, I address you as under:
1. That my client is the registered owner of the trademark/name "ASHOKA" having registration under No.354173 in Class-29 and pending registration in class-29 and 35 vide application for registration no.132429 and 133194.
2. That vide a Deed of Assignment dated 7th April, 2008, my client assigned to you its trademark "ASHOKA' in relation to edible (Oils, Vanaspati, Vanaspati Oil and other allied and related goods).
3. That in terms of the aforesaid Deed of Assignment, you were required to pay to my client a sum of Rs.1,00,000/- (Rupees One lac) towards use of the said mark.
4. That pursuant to the Deed of Assignment you have been using the trademark "ASHOKA" in relation to edible (Oils, Vanaspati, Vanaspati Oil and other allied and related goods). In terms of the said agreement, my client have complied with all its obligations of not infringing the use of the mark identical with the said trade mark or any other mark resembling it as to deceive or cause confusion in the course of trade in relation to goods in respect of which the said trade mark exists and in a CS(OS) No.3341/2015 Page 14 of 45 manner likely to be taken either as being use of and the said trade mark and/or to import a reference to the Assignee.
5. That however, despite my client complying with all its obligations under the said agreement, you have defaulted in making payment towards the amount of Rs.1,00,000/-, despite deriving the benefit of the said trademark.
Under the circumstances, I have, therefore, been instructed to call upon you, which I hereby do, to state that the Deed of Assignment dated 7th April, 2008 stands terminated. By this notice I also restrain you not to act under the said agreement and/or create any third party rights under the said agreement dated 7th April, 2008, failing which my client shall be constrained to initiate legal action against you as may be advised." (emphasis supplied) The said notice was replied by the plaintiff.
20. The defendant No.3 has specifically admitted in its notice dated 8th April, 2010 that "my client have complied with all its obligations of not infringing the use of the mark identical with the said trade mark or any other mark resembling it as to deceive or cause confusion in the course of trade......" Further, in the said notice, defendant No.3 did not say anything about its permission to defendant No.2 to use the mark. The user, if any, after assignment even otherwise tainted, dishonest and it is an act of fraud. The said claim cannot be accepted by the Court once the assignment is held to be prima facie valid.
21. Even assuming the contention of defendant No.3 that the consideration was not paid, unless the entry made is removed by the appropriate authority, the assignor has no right to infringe the same very mark which is assigned by him. The conduct of defendant No.3 speaks for itself as in the assignment deed itself it is mentioned that the defendant No.3 CS(OS) No.3341/2015 Page 15 of 45 has received the consideration. It appears from the material placed on record that there are many admissions made by defendant No.3 in judicial proceedings that in fact, the assignment between the parties has been acted upon.
22. In the suit filed by M/s Vijay Industries (Parent concern of present plaintiff) for trademark SCOOTER against defendant No.2 herein, at Dimapur Nagaland, defendant No.2 filed application under Order XXXIX Rule 4 of CPC to vacate ex-parte injunction. In that, defendant No.2 specifically pleaded that ".... the plaintiff undertakes its business in Vanaspati through a different and distinct brand i.e. "Ashoka"......" Even in the notice issued by the defendant No.3 on 8 th April, 2010, it was admitted that the defendant No.3 has not used the mark ASHOKA after assignment of Trade Mark.
23. At this stage, only the prima facie view is to be taken. From the Assignment Deed, it is clear that it is duly signed by the parties. The defendant No.3 has not denied the execution. The person who signed the Assignment Deed on behalf of defendant No.3 was the Director and is associated with the defendants No.2 & 3.
24. With regard to the plea of consideration as alleged by defendant No.3, the deed of assignment would speak for itself that the same has been received. The same has been acknowledged by defendant No.3. Even, the plea has no force in view of the settled law laid down by the Supreme Court in the case of Vidhyadhar v. Manikrao and another, reported in AIR 1999 Supreme Court 1441 at page 1450, page 35 which reads as under:-
CS(OS) No.3341/2015 Page 16 of 45"35. Even if the findings recorded by the High Court that the plaintiff had paid only Rs 500 to Defendant 2 as sale consideration and the remaining amount of Rs 4500 which was shown to have been paid before the execution of the deed was, in fact, not paid, the sale deed would not, for that reason, become invalid on account of the provisions contained in Section 54 of the Transfer of Property Act, 1882..............".
25. In the present case, it is admitted position that assignment deed is a written document wherein receipt of consideration is admitted. The defendants' plea is merely oral one. Further, the document was challenged after about two years, the same was already acted upon between the parties in the meanwhile.
26. It is a rule of law of evidence, which is also known as the "best evidence rule" that in case a written document is available, no oral evidence can be led in that regard. In the present case, in the face of a document in writing, the pleas of the defendant cannot be permitted to be taken and are barred by the provision of Section 92 of the Evidence Act.
27. In M/s. Kusum Enterprises and Ors v. Vimal Kochhar and Anr., 207(2014) DLT 172, it was observed as follows:
"(c) Section 91 of the Indian Evidence Act, 1872 provides that where the terms of a contract have been reduced in the form of a document and where the matter is required by law to be reduced in the form of a document, no evidence shall be given in proof of the terms of such contract except the document itself; Section 92 of the Evidence Act provides that where the terms of the contract required by law to be reduced in the form of a document have been proved according to Section 91, no evidence of any oral agreement between the parties for the purpose of contradicting, varying, adding to, or CS(OS) No.3341/2015 Page 17 of 45 subtracting from its terms shall be admitted; though there are exceptions to both the said provisions but the same have not been invoked by the respondents/plaintiffs or their counsel and the case is not found to be falling in any of the exceptions..."
28. It is not a case of agreement to sale but the present case is a case of assignment of movable property and rights pertaining to the trade mark. The Assignment Deed was executed with the consent of the parties. Therefore, the seller, if any, not received the consideration as mentioned by the defendant No.3 (on the basis of oral statement), the said unpaid amount can be recovered at the best if it is proved that it was not paid by the plaintiff after the execution of document.
29. It is the admitted position that after execution of document by defendant No.3 and the entry made in the register of trademarks, the said entry was not challenged on filing of rectification, which was the appropriate remedy, within the time prescribed. It is not sure as to whether the civil suit filed by the defendant No.3 before the District Judge, Jaipur for challenging the Assignment Deed was maintainable in view of the prescribed remedy available to defendant No.3 to file rectification under Section 57 of the Act. It is also doubtful, whether rectification, if filed, would be maintainable in view of the provisions of Section 33 of the Act.
30. For the sake of convenience, the said Section is reproduced here as under:-
"57. Power to cancel or vary registration and to rectify the register.-- (1) On application made in the prescribed manner to the Appellate Board or to the Registrar by any person aggrieved, the tribunal may make such order as it may think fit for cancelling or varying the registration of a trade mark on the ground of any CS(OS) No.3341/2015 Page 18 of 45 contravention, or failure to observe a condition entered on the register in relation thereto.
(2) Any person aggrieved by the absence or omission from the register of any entry, or by any entry made in the register without sufficient cause, or by any entry wrongly remaining on the register, or by any error or defect in any entry in the register, may apply in the prescribed manner to the Appellate Board or to the Registrar, and the tribunal may make such order for making, expunging or varying the entry as it may think fit.
(3) The tribunal may in any proceeding under this section decide any question that may be necessary or expedient to decide in connection with the rectification of the register.
(4) The tribunal, of its own motion, may, after giving notice in the prescribed manner to the parties concerned and after giving them an opportunity of being heard, make any order referred to in sub-section (1) or sub-section (2).
(5) Any order of the Appellate Board rectifying the register shall direct that notice of the rectification shall be served upon the Registrar in the prescribed manner who shall upon receipt of such notice rectify the register accordingly."
31. In view of aforesaid reasons, until and unless the entry in the Register of Trade Marks is removed, no defence can be raised by defendant No.3 that the assignment was bad. The registration in favour of the plaintiff is a prima facie evidence of proof under Section 31 of the Act which reads as under:-
"31. Registration to be prima facie evidence of validity. (1) In all legal proceedings relating to a trade mark registered under this Act (including applications under section 57), the original registration of the trade mark and of all subsequent assignments and transmissions of the trade mark shall be prima facie evidence of the validity thereof.CS(OS) No.3341/2015 Page 19 of 45
(2) In all legal proceedings as aforesaid a registered trade mark shall not be held to be invalid on the ground that it was not a registrable trade mark under section 9 except upon evidence of distinctiveness and that such evidence was not submitted to the Registrar before registration, if it is proved that the trade mark had been so used by the registered proprietor or his predecessor in title as to have become distinctive at the date of registration."
32. It is not in dispute that the defendant No.3 filed one Civil Suit No.19 of 2011 for declaration and injunction against the plaintiff and others before the District Court, Jaipur inter alia challenging the assignment, praying for restraining the present plaintiff from using the trademark ASHOKA, to appoint the Receiver, for profit of the accounts, to cancel the assignment and further sought relief in the nature of groundless threats, etc. The plaintiff thereafter filed its written statement in the said suit. No interim relief is granted till today restraining the stay of the operation of Assignment Deed or the order passed by the Trade Marks Office.
33. It is clear from the conduct of defendant No.3 that defendant No.3, in fact, intended to assign the ownership of the trade mark in favour of the plaintiff and, therefore, the document was executed. The intention is to be seen from the conduct of the parties after the execution of document where some rights are assigned.
34. The defendant No.3 is signatory to the said document. The defendant No.3 has not filed the rectification at the relevant period of time. Section 33 of the Act stipulates that the alleged proprietor of earlier trade mark cannot contest the validity of the registration of a subsequent trade mark it has acquiesced in the use for a continuous period of five years.
CS(OS) No.3341/2015 Page 20 of 4535. It is also a matter of fact that Directors of the plaintiff group are known as BLD Group. The defendants No.2 and 3 are known as NLD Group. In the family settlement dated 17th December, 2007 relied upon by the Directors of defendant group, it is mentioned that trademark in question i.e. ASHOKA will go to BLD Group i.e. plaintiff. The Assignment Deed dated 7th April, 2008 assigning trademark ASHOKA is executed in favour of the plaintiff Company without there being any reference of Family Settlement. The Company was not party to the above Family Settlement. It is not denied by any party that the assignment is in consonance with the terms of family settlement dated 17th December, 2007. The defendant No.3 has not denied the factum of execution of the assignment deed in favour of the plaintiff.
36. Therefore, at this stage the plea of the defendants No.2 & 3 cannot be allowed that it should be declared as invalid document. It is the admitted position that the objections earlier filed by defendant No.3 in the Trade Marks Registry to the Assignment Deed were dismissed by passing the speaking order which was not challenged by defendant No.3 in the Court of law on filing of an appeal.
37. In the present case, from the material placed on the record and the conduct of the parties, it is clear to me that prima facie, the Assignment Deed cannot be said as invalid document at this stage and defendant No.3 cannot take any advantage of the plea of invalidity of the document in this case where the infringement is taken place. Once the execution of the document is not denied and the entry is made in the Register of Trade Marks in favour of the plaintiff, the defendant No.3 has no right to infringe the CS(OS) No.3341/2015 Page 21 of 45 mark unless the entry made is removed from the register of Trade Marks upon filing of rectification.
Earlier Litigations
38. Now, I shall deal with the contentions of the rival parties pertaining to the family settlement. Admitted position is that the Directors of the plaintiff and defendant Nos.2 and 3-Companies are belonging to Data Family. Upto 2007, all parties were part of one group only. In the year 2007 dispute arose amongst the family members of Data Family. In December, 2007 certain terms to resolve the dispute of the properties of Data Family were allegedly agreed upon and as per the plaintiff, the same were noted down and signed by respective representative and partially acted upon.
39. In May, 2010 filed suit for partition being Civil Suit No.36/2010. In the said suit, the prayer made was:- (1) partition of property of Data Family stated at Schedule Ka to Chha (movable /tangible properties) (ii) mandatory injunction against defendants (NLD Group and Certain Companies hold by them) to give property to plaintiff (BLD Group) as stated in para 13 and 14 of the plaint. (i.e. transfer the shares, house of family, handing over possession of Firm, residential house, some vacant land) along with ancillary reliefs; (iii) to hand over 25% vacant land of one Jaipur Glass Factory; (iv) rendition of accounts; (v) permanent injunction against defendants restraining them from selling etc. of any part of the undivided property mentioned in Schedule Ka to Chha and not to take possession of properties and certain other ancillary reliefs.
40. It was the case of the plaintiff in the suit for partition that though BLD group parted with all properties belonging to them, NLD Group did not.
CS(OS) No.3341/2015 Page 22 of 45After about 3 years having passed after the family settlement, members of NLD Group did not act upon their obligations towards family settlement.
The prayers in the said suit are (i) to maintain status quo; (ii) to restrain the defendants from changing the nature of the property; (iii) to restrain defendants from making any change in share capital of Companies of the joint family; (iv) not to create disturbance in the day to day affairs of the business of plaintiff; (v) not to transfer undivided property which has come in the share of the plaintiff; (vi) the defendants be directed not to create disturbance in using and enjoying the property and trademark associated to plaintiff and that the Government Authorities (Registrars, Banks) be injuncted from making any amendment in the documents etc.
41. If the entire plaint is read in a meaningful manner, it appears that the plaintiff wanted to obtain the relief in the said suit also against the defendants not to disturb the continuing business the mark ASHOKA in view of acquiring the rights by virtue of assignment deed. There is no prayer in the plaint to restrain the defendants by infringing the trademark ASHOKA or any admission made by the plaintiff that after the execution of assignment, the defendants were using the trademark ASHOKA. The entire case of the plaintiff is that from the date of assignment till October, 2015, the defendant No.3 never used the mark ASHOKA, otherwise the plaintiff in the said suit filed for partition could have sought the prayer against the defendants from using and infringing the registered trademark of the plaintiff.
42. It is apparent that essentially, the suit is for (i) partition of HUF Properties; (ii) no dispute related to trademark is involved (iii) since CS(OS) No.3341/2015 Page 23 of 45 plaintiffs therein were apprehending that defendants as a pressure tactics, will attempt to disturb the rights already received by the plaintiff under Family Agreement. The prayer was also to the effect that defendants may not disturb the usage of trademark and enjoyment of other properties. Such prayer for groundless threat, if apprehended by the plaintiff, was permissible in law.
43. It is apparent that the suit is for partition of movable property and shares and such other tangible assets but not for any prayer regarding infringement of trademark by the defendants as the defendants were allegedly not using the trademark ASHOKA at that point of time though filed counter temporary injunction application, has not prayed any relief in respect of any trademark including ASHOKA or its assignment. In the said suit, the defendants Nos. 2 and 3 herein were parties as defendant No. 24 and 14 respectively. They appeared in the said suit and had denied the family settlement on the ground that the Company cannot be part of HUF/Family Settlement.
44. The plaintiff in the said suit had pleaded the facts of assignment dated 7th April, 2008 in favour of the plaintiff Company assigning trademark ASHOKA by defendants. Defendant No.3 in the said suit, for the first time, disputed the assignment on the ground of not receiving consideration as well as the authority of Director of assignor Company who had signed the same. The defendant Nos. 2 and 3 did not file any counter claim and by application for temporary injunction however, did not pray any relief with regard to trademark ASHOKA against the plaintiff.
CS(OS) No.3341/2015 Page 24 of 4545. Admittedly, District Court, Jaipur on 10th February, 2011 passed order that (i) defendants in above suit shall not sell/transfer the immovable properties mentioned at Schedule-Ka to Chha; (ii) Companies/ Partnership Firm controlled/run by parties of which details is given in Schedule-Ka to Chha, regarding them audited accounts periodically shall be presented before the Court. The other prayers made by both the parties were rejected.
46. Against above order, NLD Group/defendants herein preferred appeal in April, 2011 praying to set aside order of District Judge restraining them from transferring the properties at Schedule-Ka to Chha. BLD Group also preferred appeal before Rajasthan High Court for limited prayer of granting relief of maintaining status-quo qua property at Schedule-Ka to Chha.
47. The Rajasthan High Court on 14th March, 2012 allowed the appeals preferred by defendants and lifted the stay against the Companies (qua property at Schedule-Ka to Chha) maintaining other part of order of District Judge. Appeal of BLD Group was dismissed. Being aggrieved on 20th March, 2012 BLD Group preferred to file SLP (C) No. 9914/2012 before the Supreme Court.
48. The Supreme Court on 4th August, 2014 set aside the above order of Rajasthan High Court and remitted the matter back for fresh hearing. From the judgment of Supreme Court particularly reciting from para 3 and 4, it appears that the dispute is mainly relating to immovable properties stated in Schedule-Ka to Chha. Further mainly the submissions of defendant companies are recorded to the effect that the suit of partition itself is not maintainable since present plaintiff in the partition suit also is a Company incorporated under the Companies Act and the partition of the properties CS(OS) No.3341/2015 Page 25 of 45 mentioned in Schedules-Ka to Chha is sought against set of companies which have been shown as assets of HUF. It is the main case of defendants that none of the Companies have anything to do with the family settlement in any manner.
49. No relief whatsoever dealt with or granted in favour of defendant No.2 and 4 in respect of proprietorship of trademark ASHOKA or its assignment.
50. After remand of the matter by the Supreme Court in 2015. The Rajasthan High Court again passed an order in favour of defendants not to restrain them in any manner qua property at Schedule-Ka to Chha. The plaintiff filed the SLP which is pending before the Supreme Court. In the meanwhile, CLB granted order of status quo against the properties of the Companies against which relief is sought in above partition suit. Therefore, under these circumstances, Babu Lal Data (of BLD Group) deposed before the Supreme Court that relief against the certain Companies are not pressed for, as CLB has already granted order of status-quo.
51. Thus, had the plaintiff in the partition suit would have sought the relief for injunction against the defendants for infringement of the trademark ASHOKA, the position would have been different and the present suit may not be maintainable. However, the facts in the present case are different. The defendants No.2 and 3 in the present case are misleading the Court. In fact, the averments made in the suit for partition and the prayer made inter alia in respect of the trademark is akin to the suit for groundless threat which is permissible under the Trade Marks Act, 1999.
CS(OS) No.3341/2015 Page 26 of 4552. The relevant provision for filing the suit for threat and groundless threat is reproduced here as under:-
Section 142 of The Trade Marks Act, 1999 "142. Groundless threats of legal proceedings.-- (1) Where a person, by means of circulars, advertisements or otherwise, threatens a person with an action or proceeding for infringement of a trade mark which is registered, or alleged by the first mentioned person to be registered, or with some other like proceeding a person aggrieved may, whether the person making the threats is or is not the registered proprietor or the registered user of the trade mark bring a suit against the first mentioned person and may obtain a declaration to the effect that the threats are unjustifiable and an injunction against the continuance of the threats and may recover such damages (if any) as he has sustained, unless the first-mentioned person satisfies the court that the trade mark is registered and that the acts in respect of which the proceedings were threatened, constitute or, if done would constitute, an infringement of the trade mark.
(2) The last preceding sub-section does not apply if the registered proprietor of the trade mark, or a registered user acting in pursuance of sub-section (1) of section 52 with due diligence commences and prosecutes an action against the person threatened for infringement of the trade mark.
(3) Nothing in this section shall render a legal practitioner or a registered trademarks agent liable to an action under this section in respect of an act done by him in his professional capacity on behalf of a client.
(4) A suit under sub-section (1) shall not be instituted in any court inferior to a District Court."
53. If the said provision is read, it is clear that the suit for infringement of trademark is not barred after filing the suit for groundless threat. The CS(OS) No.3341/2015 Page 27 of 45 plaintiff apparently in the suit for partition had sought the prayer not to disturb the business of the plaintiff bearing the mark ASHOKA on the strength of Assignment Deed as the plaintiff apprehended that in order to put the pressure upon the plaintiff, the defendants may try to disturb the business of the plaintiff by initiation of any type of action.
54. Thus, the pendency of suit for partition by the plaintiff prior to the present suit has no consequence as far as filing of infringement suit is concerned. In the present suit, the plaintiff is trying to enforce its rights granted by virtue of Assignment Deed. The Assignment Deed has already been accepted by the Trade Marks Office, unless it is rectified or removed from the Registrar of Trademarks. It is admitted position that no suit against the defendant No.2 and 3 was pending for infringement of Trade Mark on behalf of the plaintiff when the present suit was filed. Prior to this suit, no infringement proceedings are pending anywhere. Thus, the question of resjudicata on the basis of earlier litigation does not arise. The question of concealment of facts does not arise in the present case as the parties have filed all the requisite documents. No ex parte interim order was issued.
Long User claimed by defendant No.2 and 355. It is denied by the plaintiff that neither defendant No.2 nor defendant No.3 used the Trade Mark in question from 2007 till October 2015 as they cannot. Even, in rejoinder dated 4th August, 2015 filed before Jaipur District Court in above Civil Suit No.19 of 2011, defendant No.3 has given its sales details upto 20th October, 2007, i.e. before assignment to plaintiff. It is only in October, 2015 that the defendant No.2 started using Trade Mark in question as permitted user of defendant No.3. Directors are common in both CS(OS) No.3341/2015 Page 28 of 45 defendants No.2 and 3. Defendant No.2 is trying to enter the market in New Delhi through defendant No.1.
56. With regard to long user claimed by defendants No.2 & 3, they have placed few bills referring trademark ASHOKA brand in respect of its product of Vanaspatti Ghee. Bills are starting from 13 th April, 2008 to 19th May, 2015 which are denied by the plaintiff who argued that these bills are false and manipulated. In fact, it is the defendant No.3, who claims to be proprietor of the mark and defendant No.2 is claiming to be permitted user of defendant No.3.
Prima facie, no cogent and clear evidence is produced in order to establish that the mark ASHOKA has been used by them openly in the market from the year 2008 as alleged.
57. The defendants No.2 & 3 did not produce any single document, which is unimpeachable document i.e. by way of advertisement or any cogent and clear and clinching evidence in order to show even prima facie that it was continuous user except few bills.
58. In view of such circumstances, inference has to be drawn from the conduct of the party who is involved in other litigation and admissions which were made. Admittedly, the defendant No.3 filed Suit No.19/2011 in the District Court, Jaipur challenging the assignment deed in question dated 7th April, 2008, did not join defendant No.2 herein as party in the above suit. Defendant No.3 did not say anywhere till August, 2015 even in the additional documents that defendant No.2 is the permitted user of defendant No.3 qua the trademark ASHOKA.
CS(OS) No.3341/2015 Page 29 of 45In the said suit No.19/2011, the defendant No.3 filed application on 4th August, 2015 under Order VII Rule 14 read with Section 151 CPC for producing additional relevant documents as those could not be filed. In the said application, the invoices were produced upto the date 20 th October, 2007 only. No bill, advertisement or any such other document after the year 2008 was produced. No claim of permitted user by defendant No.2 was raised.
59. Even otherwise, the claim of long user is prima-facie false and frivolous, as it is the admitted position that earlier the defendant No.2 had also filed one Civil Suit No.101 of 2013 before District Court, Jaipur against
(i) Hari Agro, (ii) Vijay Industries- Sister/ Parent concern of present plaintiff under the provisions of the Trade Marks Act to restrain above concerns from using trademark SCOOTER VANASPATI. In that, in Para 7, defendant No.2 gave details of total value of production of vegetable oil in Metric Tons and amount by defendant No.2 under trademark SCOOTER upto the year 2012-13. Defendant No.2 also produced one statement of quantity of production of Vanaspati Ghee.
60. If the summary of Vanaspati Ghee sales/ production is compared with the annual report of defendant No.2, it is clear that whatever Vanaspati Ghee is produced by defendant No.2 is sold under only one trademark i.e. SCOOTER VANASPATI. Thus, no quantity of VANASPATI Ghee is left out to be sold under any other trademark including trademark ASHOKA. The said detail is stated in chart form is filed by the plaintiff who referred the Annual Report in this regard.
CS(OS) No.3341/2015 Page 30 of 4561. None of the defendants have filed any advertisement published by them of the trademark ASHOKA. On the other hand, it appears that the defendants have stopped giving advertisement qua trademark ASHOKA after the year 2008 i.e. after execution of the Assignment Deed. It is also pertinent to mention that before the groups were separated, one brochure of Data Group (to which directors of all the parties are belonging) was published in the year 2005. In that brochure, the brand name ASHOKA is mentioned. The website of defendant No.2, print of which is taken out on 28th November, 2015 does not refer trademark in question i.e. ASHOKA as its brand and only refers SCOOTER and NEERAJ under the head of their Brands.
62. Similarly, the defendant No.2 made averments in SLP (C) No. 851 of 2014 filed by it before Supreme Court that Vijay Industries (group of plaintiff) is doing its business of Vanaspati Ghee under trademark ASHOKA. Nothing was mentioned about the user since 2000 or about the relation of permitted user of defendant No.3.
63. The print out from the website of defendant No.2 give picture of all its products with respective brands which also does not depict the trademark in question i.e. ASHOKA.
64. Recently Newspaper Advertisement given by the plaintiff and the defendants are published on same page in the local newspaper 'Dainik Bhaskar' on 11th November, 2015. Advertisement of plaintiff group does depict trademark in question ASHOKA whereas the advertisement of defendants Group does not depict the same though it depicts other brands/labels.
CS(OS) No.3341/2015 Page 31 of 4565. Defendants No.2 and 3 also published one Diwali Calender which does not depict the trademark ASHOKA along with other trademarks.
66. The Annual Report of defendant No.2 for the financial year 2013-14 and 2014-15 also does not refer the trademark ASHOKA. On the other hand, the plaintiff has given advertisement of trademark ASHOKA in all its publications.
67. After assignment, rights still existed with defendant No.3. The silence of defendant No.2 speaks for itself that the mark was assigned, however, the defendants No.2 & 3 have started using the mark ASHOKA very recently which is an afterthought. The defendants have not produced any detail of sales turn over or advertisement expenses of any of its products under the trademark in question ASHOKA though filed reply.
Law on Delay
68. Now, with regard to question of delay, defendants submit that they have been using the mark in question for a long period of time. In view of the material available on record and the pleadings of defendant No.3, it appears that defendant No.3 has never claimed that they have used the mark after assignment in favour of the plaintiff. Not even single cogent evidence is produced except invoices. One can easily presume from the pleadings of defendant No.3 in earlier litigation where the defendant No.2 had maintained silence about user after assignment in favour of the plaintiff. Even otherwise, if the defendant No.3 has used the mark after assignment, it amounts to fraud. It would be called as hidden user.
69. The issue of delay and acquiescence has been considered by Courts in various matters. Some of them are referred to as under:
CS(OS) No.3341/2015 Page 32 of 45a) In the case of Midas Hygiene Industries Pvt. Ltd. v. Sudhir Bhatia and others, reported in 2004 (28) PTC 121, relevant para-5 of the said judgment reads as under:
"5. The law on the subject is well settled. In cases of infringement either of Trade Mark or of Copyright normally an injunction must follow. Mere delay in bringing action is not sufficient to defeat grant of injunction in such cases. The grant of injunction also becomes necessary if it prima facie appears that the adoption of the Mark was itself dishonest."
b) In the case of Swarn Singh v. Usha Industries (India) and Anr., reported in AIR 1986 Delhi 343 (DB) it was held as under:
"There is then the question of delay. Learned counsel for the respondents had urged that the delay is fatal to the grant of an injunction. We are not so satisfied. A delay in the matter of seeking an injunction may be aground for refusing an injunction in certain circumstances. In the present case, we are dealing with a statutory right based on the provisions of the trade and Merchandise Marks Act, 1958. An exclusive right is granted by the registration to the holder of a registered trade mark. We do not think statutory rights can be lost by delay. The effect of a registered mark is so clearly defined in the statute as to be not capable of being misunderstood. Even if there is some delay, the exclusive right cannot be lost. The registered mark cannot be reduced to a nullity....."
c) In the case of Hindustan Pencils Pvt. Ltd. v. M/s India Stationery Products Co., reported in AIR 1990 DELHI 19, it was held as under:
"29. If an action is taken by the registered owner and no interim injunction is granted, the effect is that goods bearing the infringing mark or spurious goods would continue to be sold in the market. After a number of years when the case is finally disposed of, after trial, and the plaintiff succeeds and CS(OS) No.3341/2015 Page 33 of 45 gets a permanent injunction then, possibly, the plaintiff may also be compensated by his being awarded damages or an account of profits. In that sense the non-grant of the interim injunction would not, ultimately, prejudice the plaintiff for he may be compensated with payment of money but during this period when the defendant is allowed to continue to infringe the intellectual property it is the consumer or the purchaser who alone suffers and who ultimately cannot be compensated. Therefore, in order to curb the menace of manufacture, production and sale of spurious goods and the blatant violation of intellectual property it will be proper for the Court to take into consideration the interest of the general public. In this regard reference may usefully be made to the following observations of McCarthy at page 346, para 30.21, which deals with the protection of third parties:
"Some Courts also consider the necessity of protecting third parties. In trade mark infringement cases, "third parties" means the buying public. If the equities are closely balanced, the right of the public not to be deceived or confused may turn the scales in favour of a preliminary injunction."
30. It would appear to be difficult to accept hat relief of temporary injunction should not be granted, because of the delay on, the part of the plaintiff, even though the Court feels, at that point of time, that, ultimately permanent injunction will have to be granted.
31. Even though there may be some doubt as to whether laces or acquiescence can deny the relief of a permanent injunction, judicial opinion has been consistent in holding that if the defendant acts fraudulently with the knowledge that he is violating the plaintiff s rights then in that case, even if there is an inordinate delay on the part of the plaintiff in taking action against the defendant, the relief of injunction is not denied. The defense of laces or inordinate delay is a defense in equity. Inequity both the parties mud's CS(OS) No.3341/2015 Page 34 of 45 come to the Court with clean hands. An equitable defense can be put up by a party who has acted fairly and honestly. A person who is guilty of violating the law or infringing or usurping somebody else's right cannot clarify the continued misuse of the usurped right. It was observed by Romer, J. in the matter of an application brought be J. R. Parkington and Co. Ld., (1946) 63 RPC 171 at page 181 that "in my judgment, the circumstances which attend the adoption of a trade mark in the first instance are of considerable importance when one comes to consider whether the use of that mark has or has not been a honest user. If the user in its inception was tainted it would be difficult in most cases to purify it subsequently". It was further noted by the learned Judge in that case that he could not regard the discreditable origin of the user as cleansed by the subsequent history. In other words, the equitable relief will be afforded only to that party who is not guilty of a fraud and whose conduct shows that, there had been, on his part, an honest concurrent user of the mark in question. If a party, for no apparent or a valid reason, adopts, with or without modifications, a mark belonging to another, whether registered or not, it will be difficult for that party to avoid an order of injunction because the Court may rightly assume that such adoption of the mark by the party was noting honest one. The Court would be justified in concluding that the defendant, in such an action, wanted to cash in on the plaintiffs name and reputation and that was the sole, primary or the real motive of the defendant adopting such a mark. Even if, in such a case, there may be an inordinate delay on the part of the plaintiff in bringing a suit for injunction, the application of the plaintiff for an interim injunction cannot be dismissed on the ground that the defendant has been using the mark for a number of years. Dealing with this aspect Harry D. Nims in his "The Law of Unfair Competition and Trade Marks", Fourth Edition, Volume Two at page 1282 noted as follows:
"Where infringement is deliberate and willful and the defendant acts fraudulently with knowledge that he is CS(OS) No.3341/2015 Page 35 of 45 violating plaintiffs rights, essential elements of estoppels are lacking and in such a case the protection of plaintiffs rights by injunctive relief never is properly denied. "The doctrine of estoppels can only be invoked to promote fair dealings"."
d) In the case of M/s. Bengal Waterproof Limited v. M/s. Bombay Waterproof Manufacturing Company and Another, reported in AIR 1997 SC 1398, it was held as under:
"20.........It is now well settled that an action for passing off is a common law remedy being an action in substance of deceit under the Law of Torts. Wherever and whenever fresh deceitful act is committed the person deceived would naturally have a fresh cause of action in his favour. Thus every time when a person passes off his goods as those of another he commits the act of such deceit. Similarly whenever and wherever a person commits breach of a registered trade mark of another he commits a recurring act of breach or infringement of such trade mark giving a recurring and fresh cause of action at each time of such infringement to the party aggrieved. It is difficult to agree how in such a case when in historical past earlier suit was disposed of as technically not maintainable in absence of proper relief, for all times to come in future defendant of such a suit should be armed with a license to go on committing fresh acts of infringement and passing off with impunity without being subjected to any legal action against such future acts."
Infringement of Trademark
70. The plaintiff is the registered subsequent proprietor of the trademark ASHOKA. The benefit of user of 1975 by Rohtas Industries would come in favour of the plaintiff. The defendants No.2 & 3 are using the identical trademark in respect of the same goods and in the same area. They have also infringed the copyright of the plaintiff in the label mark. There is no valid CS(OS) No.3341/2015 Page 36 of 45 justification given by defendant No.3 to use the same mark after assignment. Thus, the plaintiff has been able to make out a classic case of infringement.
71. On registration of a trademark, the registered proprietor under Section 28 of the Trade Marks Act, 1940 gets the exclusive right to the use of such trademarks in relation to the goods in respect of which the trademark is registered and to obtain relief in respect of any infringement of such trademark. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trademark for the vindication of the exclusive right to the use of the trade mark in relation to those goods. Reliance is placed on Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories AIR 1965 SC 980 and National Bell Co. and Gupta Industrial Corporation v. Metal Goods Mfg. Co. (P) Ltd. AIR 1971 SC 898.
72. It is well settled that if the party is holding the registration and two rival marks are either identical with or deceptively similar in relation to the goods in which the trademark is registered, a case of infringement is made out. The Supreme Court in various cases has dealt with this aspect.
a) In the case reported as National Bell Co. (supra) it was observed as under:
"On registration of a trademark the proprietor gets under Section 28 the exclusive right to the use of such trade mark in relation to goods in respect of which the trade mark is registered and to obtain relief in respect of any infringement of such trademark."
b) Again, in the case of American Home Products Corporation Vs. Mac Laboratories Pvt. Ltd. AIR 1986 SC 137 it was observed as under:
CS(OS) No.3341/2015 Page 37 of 45"When a person gets his trademark registered he acquires valuable rights by reason of such registration."
73. Scanned copies of two labels used by the parties are reproduced below:-
Plaintiff's Label CS(OS) No.3341/2015 Page 38 of 45 Defendants' Label CS(OS) No.3341/2015 Page 39 of 45 Passing off
74. The test of confusion and deception in order to prove the case of passing off has been very well discussed in the case of Laxmikant V. Patel v. Chetanbhat Shah and Another, reported in (2002) 3 SCC 65, wherein the Supreme Court while considering a plea of passing off and grant of ad interim injunction held in no uncertain terms that a person may sell his goods or deliver his services under a trading name or style which, with the passage of time, may acquire a reputation or goodwill and may become a property to be protected by the Courts. It was held that a competitor initiating sale of goods or services in the same name or by imitating that name causes injury to the business of one who has the property in that name. It was held that honesty and fair play are and ought to be the basic policy in the world of business and when a person adopts or intends to adopt a name which already belongs to someone else, it results in confusion, has the propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury.
It was also held in Laxmikant v. Patel (supra) that the principles which apply to trademark are applicable to trade name also. Para 10 of the aforesaid judgment reads as under:-
"The law does not permit any one to carry on his business in such a way as would persuade the customers or clients in believing that his goods or services belonging to someone else are his or are associated therewith. It does not matter whether the latter person does so fraudulently or otherwise. The reasons are two. Firstly, honesty and fair play are, and ought to be, the basic policies in the world of business. Secondly, when a person adopts or intends to adopt a name in connection with his business or services which already belongs to someone else it CS(OS) No.3341/2015 Page 40 of 45 results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury."
In this case, the Supreme Court further observed that:
"Where there is probability of confusion in business, an injunction will be granted even though the defendants adopted the name innocently."
75. After examining the two labels it appears that two labels are similar and both are bought in the same market, the confusion and deception is bound to happen.
Territorial Jurisdiction
76. With regard to the issue of territorial jurisdiction, the plaintiff has invoked the jurisdiction on the basis of specific averments made in paras 52 to 55 of the plaint. The same read as under:-
"52. As stated above, the plaintiff has come to know about the impugned activity of the defendants recently in October, 2015 and plaintiff conducted the inquiry in the markets of Delhi, as stated hereinabove in this plaint. As stated above the defendants are trying to enter the market or have entered the market very recently. Further, the defendants are at present selling its products in clandestine manner and not issuing formal bill or invoices against its cell in the market of Delhi.
53. The cause of action of the present suit has arose in the month of October, 2015 when the plaintiff learnt about the defendant's impugned adoption and user of the trademark ASHOKA of the plaintiff. Further, the cause of action is as per the averments made in this plaint. The cause of action is continuous one and is accruing everyday and shall continue to so accrue till the defendants cease to use the impugned trademark ASHOKA and cease with their impugned use and adoption of the impugned trademark. Thus, there is no delay or CS(OS) No.3341/2015 Page 41 of 45 acquiescence or waiver or estoppels or admission or any other kind of bar or restraintment against the plaintiff to seek relief against the defendants, as prayed in the present suit.
54. This Hon'ble Court has the territorial jurisdiction to try and adjudicate the present suit. The defendants are committing the impugned act of infringement and passing off of the trademark of the plaintiff viz. ASHOKA and infringement of the copyright of the label that of, within the territorial jurisdiction of this Hon'ble Court by conducting, soliciting, selling and marketing their impugned goods and business under the impugned trademark/label in New Delhi.
55. The defendants are having their traders, sellers, marketing people in Delhi. Further, plaintiff has come to know that defendants are taking help of professional marketing persons to market their goods under the impugned trademark/label ASHOKA in Delhi. Thus, the cause of action has arisen within the territorial jurisdiction of this Hon'ble Court. The plaintiff is also selling its product and carrying on its business activity under the trademark ASHOKA in Delhi. Therefore, the cause of action with regard to confusion and thereby infringement and passing off of the trademark and infringement of copyright of the plaintiff has also taken place within the territorial jurisdiction of this Court. Further, the trademark registered in favour of the plaintiff vide application No.1324290 in Class-29 is in Trade Marks Registry, New Delhi."
77. The plaintiff has also filed invoice of sale of goods of defendant No.2 in Delhi. The same is available on record. At this stage, the plaint cannot be thrown away, in view of the pleadings and evidence available on record. Further, it was also a case of quia timet action. The law of territorial jurisdiction is quite settled which has been laid down in the following judgements:-
CS(OS) No.3341/2015 Page 42 of 45i. In Tata Iron & Steel Co. Ltd. v. Mahavir Steels & Ors.; 47(1992) DLT 412 it was observed in para 11 as under:
"11. The question regarding jurisdiction can only be gone into after the evidence of the parties is recorded in the case. Even in the Punjab case the suit was not thrown out at the threshold under Order 7 Rule 11 CPC but only after the parties were given an opportunity to lead evidence. The plaint in the present suit categorically states that the defendant no.1 was selling the channels of defendant no.2 under the offending trade mark which is deceptively similar to that of the plaintiff. On these averments the Court must assume jurisdiction and proceed with the suit to determine the question relating to the confirmation/vacation of the stay order at this stage."
ii. In Pfizer Products Inc. v. Rajesh Chopra & Ors, 2006(32) PTC 301(Delhi) wherein it was observed as under :-
"12. The other aspect of the matter is that a threat of selling the offending goods in Delhi would in itself confer jurisdiction in the courts in Delhi to entertain a suit claiming an injunction in respect thereof. Whether the threat perception is justified or not is another matter which has to be considered and decided upon in the application filed by the plaintiff under Order 39 Rules 1 and 2 or on merits when the suit is taken up for disposal. Insofar as Order 7 Rule 10 is concerned, assuming that whatever is stated in the plaint is correct, one would have to also assume that the threat or the intention of the defendants to sell and offer for sale the offending goods in Delhi is also correct. Therefore, if the threat exists then this court would certainly have jurisdiction to entertain the present suit.
iii. In LG Corporation & Anr. v. Intermarket Electroplasters(P) Ltd.
and Anr.; 2006 (32) PTC 429, following observations were made in para 7 :-CS(OS) No.3341/2015 Page 43 of 45
"7. ......The question as to whether the Court has territorial jurisdiction to entertain a suit or not has to be arrived at on the basis of averments made in the plaint, that truth or otherwise thereof being immaterial as it cannot be gone into at this stage....."
78. In view of the facts and circumstances of the case, prima facie it appears that assignment deed is a valid document, in earlier litigation no suit for infringement was ever filed or pending against the defendants. The defendants cannot take the advantage of earlier litigations by infringing the TradeMark. There is no cogent clear and clinching evidence prima facie available to establish that after the assignment, the defendant No.3 has used the mark ASHOKA in public on commercial scale, the defence in this regard is a moonshine. Thus, till the assignment is valid and subsisting on the Register of Trade Marks, the defendants are not entitled to infringe the mark ASHOKA.
79. Under these circumstances, this Court is of the view that the plaintiff has been able to make a strong prima facie case for grant of interim order. Since the plaintiff is the registered proprietor of the trademark ASHOKA and the same has been used earlier than the defendants, thus, the balance of convenience also lies in favour of the plaintiff and against the defendants. In case the injunction order is not passed, the plaintiff will suffer irreparable loss and injury.
80. Thus, during the pendency of the suit, the defendants, their proprietors, partners, directors, agents and all other acting for and on their behalf are restrained from using, selling, soliciting, exporting, displaying, advertising by visual, audio, print mode or by any other mode or manner or dealing in or using the impugned trademark ASHOKA or any other trade CS(OS) No.3341/2015 Page 44 of 45 mark/label identical with and/or deceptively similar to the trade mark/label ASHOKA of the plaintiff in relation to the said goods of their impugned goods and business including the edible oil and related/allied products, amounting to infringement of the copyright of the plaintiff arising out of the artwork in the said label and also from passing off their goods as that of the plaintiff.
81. The application is accordingly disposed of.
CS(OS) No.3341/2015List this matter before the roster Bench on 3rd June, 2016, subject to orders of Hon'ble the Judge Incharge (Original Side).
(MANMOHAN SINGH) JUDGE APRIL 22, 2016 CS(OS) No.3341/2015 Page 45 of 45