Delhi District Court
Pardeep Manchanda vs Gulshan Kumar Manchanda on 16 November, 2023
DLCT010029012023
IN THE COURT OF SH. SANJEEV KUMAR AGGARWAL :
DISTRICT JUDGE (COMMERCIAL) -01 : CENTRAL, TIS
HAZARI COURTS, DELHI.
OMP (I) (Comm) No. 195/23
SH. PARDEEP MANCHANDA,
S/O SH. K.L.MANCHANDA,
PARTNER OF M/S MANCHANDA BROTHERS,
R/O 77A, SAINIK VIHAR,
NEW DELHI-110034
.... Applicant / Petitioner.
Versus
1. SH. GULSHAN KUMAR MANCHANDA,
S/O SH. K.L.MANCHANDA,
PARTNER OF M/S MANCHANDA BROTHERS,
R/O 77 B, SAINIK VIHAR,
NEW DELHI-110034
2. SH. VARUN KUMAR MANCHANDA,
S/O SH. GULSHAN KUMAR MANCHANDA,
PARTNER OF M/S MANCHANDA BROTHERS,
OMP (I) (Comm) No. 195/23 Page No. 1 of 18
R/O 77 B, SAINIK VIHAR,
NEW DELHI-110034
3. SH. RAHUL MANCHANDA
S/O SH. GULSHAN KUMAR MANCHANDA,
PARTNER OF M/S MANCHANDA BROTHERS,
R/O 77 B, SAINIK VIHAR, NEW DELHI-110034
4. MANCHANDA BROTHERS,
A PARTNERSHIP FIRM
THROUGH ITS PARTNERS
ALL THE RESPONDENTS ALSO AT:-
M/S MANCHANDA BROTHERS, FACTORY AT:- 1869, HSIDC INDUSTRIAL ESTATE, RAI, DISTRICT SONIPAT, HARYANA, REGD. OFFICE AT: -
M/S MANCHANDA BROTHERS, REGD. OFFICE AT: -
486, KATRA MEIDGARH, KAHRI BAOLI, DELHI-110006 .... Respondents APPLICATION UNDER SECTION 9 OF THE ARBITRATION & CONCILIATION ACT, 1996 SEEKING INTERIM RELIEF.
Date of Institution : 24.02.2023
OMP (I) (Comm) No. 195/23 Page No. 2 of 18
Date of reserving Order : 28.08.2023
Date of pronouncement of Order : 16.11.2023.
Order
1. Vide this order, I shall decide the instant
application/petition moved on behalf of applicant/petitioner under Section 9 of the Arbitration and Conciliation Act, 1996 seeking interim relief in the name of appointment of local commissioner with direction to restrain the respondents from using the trademarks / label / words Titli Hing, Natraj Hing, Shivalik Hing & Agni Hing and to take possession of the material used for the manufacturing and selling the same and also to restrain the respondents to deal with the stock and property of the partnership firm namely Manchanda Brothers.
2. Brief facts as stated in the petition are that petitioner is one of the partners of the partnership firm running under the name and style of M/s Manchanda Brothers and earlier Sh. Pradeep Manchanda (applicant), Sh. Harish Manchanda and Sh. Gulshan Manchanda were the partners of the said firm and the firm is running its business since 1976.
3. It has been further stated that the said firm since the induction of the same introduced several products in the market under the name and style of Titli Hing & Food Spices, Shivalik Hing, Agni Hing and Natraj Hing and Food Spices. It has been further stated that as per the clause 14 of the partnership deed 02.04.2007, the profit and loss between the partners has been OMP (I) (Comm) No. 195/23 Page No. 3 of 18 distributed as follows: -
Sh. Harish Manchanda 10% Sh. Gulshan Manchanda 17% Sh. Pradeep Manchanda 33% Sh. Rahul Manchanda 20% Sh. Varun Manchanda 20%
4. It is further stated that as per Clause 15 of the of the partnership agreement it is clear that in case of any dispute between the partners with regard to the interpretation of the deed or any other matter relating to the firm the same shall be refer to a Arbitrator mutually agreed upon by the parties and the decision given by shall be binding all the parties and none of the party shall have any right to move in the court of law against the decision.
5. It has been further stated that the partnership firm is in the business of manufacturing marketing, selling and supplying of Hing, Foods Spices, Dhup, Hawan Samagri and other related goods for household use and allied products and offering its products in connection thereto its distributors, agents and direct consumers and selling the products under the name and style since 1976 and since 05.03.1998, using the brand of Titli Hing, Natraj Hing & since 2008 the registration of trade mark of the partnership firm U/s 23(2) Rule 62 (1) under Trade Mark Act of the partnership firm product under the name, style and pattern as Titli Hing, Natraj Hing & Food Spices, Agni Hing and Shivalik Hing. It has been further stated that the partnership firm of the applicant and respondents sold its products and traded by all the partners of the partnership firm directly or through agents and at retail counter including through e-commerce and somehow OMP (I) (Comm) No. 195/23 Page No. 4 of 18 dispute arose between the partnership firm i.e. Manchanda Brothers wherein all the parties in the present petition are the partners of the same and without any rhyme and reason the respondents restrained the applicant from entering into business premises as well as to look after day to day affairs of the business of the partnership firm.
6. It has been further stated that respondents had filed a suit against the applicant thereby invoking Section 134 & 135 of Trade Mark Act, 1999, Section 55 of Copy Right Act for permanent injunction in the Court of Sh.S.S.P. Laler, Ld. ADJ, in TM No.91/2017 title Manchanda Brothers Vs. Manchanda Foods and Ld. ADJ vide order dated 15.12.2017 appointed Local Commissioner to seize articles and thereafter, petitioner appeared before the Court and moved an application U/s 5 & 8 of the Arbitration Act with the ground that the same is a partnership dispute as per the partnership deed and the Court vide its order dated 24.01.2018 dismissed the suit of the respondents and thereafter, the respondents preferred an applicant vide CM (M) No. 164/2018 against the said order and vide order dated 15.02.2019, the petition of the respondent was allowed and Hon'ble High Court set aside the impugned order dated 24.01.2018 and now, the matter is fixed for orders on application U/o 39 Rule 1 & 2 CPC moved by the Respondents for 14.03.2023.
7. It has been further stated that all the trademarks of the partnership firms are registered in the name of Sh. Gulshan Manchanda and Sh. Pradeep Manchanda being the partners of the partnership firm and since, the dispute has been arose between the partners of the partnership firm, hence, the present OMP (I) (Comm) No. 195/23 Page No. 5 of 18 application. It has been further stated that respondents are doing the business by selling all the products which are registered in the joint names of the partners of the firm i.e. Manchanda Brothers and are earning huge amount by selling the products as admitted by the respondents in their suit No.91/2017 filed by them against the Manchanda Foods.
8. It has been further stated that respondents are not the sole owner of the trade mark and are using the same in relation to their impugned goods and business. It has been further stated that respondents are using the said trade mark dishonestly and fraudulently and out of positive greed just to cause loss to the applicant without giving any share in the profit to the applicant in the entire business and property and without any dissolution deed of the said partnership firm namely Manchanda Brothers and caused loss to the applicant.
9. Notice of the said applicant/petition was issued to the respondents and respondents filed reply in which they have taken the preliminary objections that earlier the petitioner had filed similar application with this Court, which was registered as TM no. 37/2019 titled as "Sh. Pradeep Manchanda Vs. Sh. Harish Kumar Manchanda" which was disposed off vide order dated 11.02.2019, however, despite of the said order the petitioner failed to commence the Arbitral proceedings within 90 days from the date of that order as such the same petition with same cause of action is not maintainable in the eyes of law. It has been further stated that petitioner has not placed the current partnership deed on record and said facts are concealed by the petitioner that the Partnership Deed dated 01.09.2007 is executed between the Partners which is current deed and in existence OMP (I) (Comm) No. 195/23 Page No. 6 of 18 between the parties. It has been further stated that petitioner is trying to mislead this Court by portraying the false story of registration of the Trade Mark in the name of Sh. Gulshan Manchanda and others and the application for registration of the Trade mark was submitted before the Trade Mark authorities and was filed by M/s Manchanda Brothers, hence, the present application is devoid of merits and contradictory to the records of the Trade Mark authority. On the contrary it is the Petitioner who has played fraud with the partnership Manchanda Brothers, and its partners by infringing the registered trade mark products of Manchanda Brothers for his own proprietorship firm M/s Manchanda Foods with sole intend to cheat the partners and make undue profits and loss to the Firm.
10. It has been further stated that the proceedings under section 9 of the Act, are counter blast to the Suit under section 134 & 135 of the Trade Mark Act, 1999 r/w section 55 of the Copyright Act, 1957 filed by M/s Manchanda Brothers against M/s Manchanda Foods (Sole Prop. of M/s Pradeep Manchanda).
11. On merits, it is admitted by the respondents that applicant had earlier filed a petition under section 9 of the Arbitration and Conciliation Act 1996 vide petition no. TM 37/2019 wherein the Court was pleased to passed the orders thereby appointing the Local Commissioner, however the Petitioner never executed the said order, as the objections was filed by the respondents, and the matter was disposed of by the Court. It is further admitted by respondents that petitioner is one of the partners of the partnership firm running under the name and style of M/s Manchanda Brothers having their office at 486, Katra Meidgran, Khari Baoli Delhi-6 and the defendants are the other partners of OMP (I) (Comm) No. 195/23 Page No. 7 of 18 the same firm and the said firm is running its business since 1976 and are in the business of manufacturing marketing, selling and supplying of Hing, Foods Spices, Dhup, Hawan Samagri and other related goods for household use and allied products and offering its products in connection thereto its distributors, agents and direct consumers, however, w.e.f 01.09.2007 there are 5 partners of the Firm namely Harish Manchanda, Gulsan Manchanda, Pradeep Manchanda, Rahul Manchanda, and Varun Manchanda. It is also admitted that the said firm since the induction of the same introduced several products in the market under the name and style of Titli Hing & Food Spices, Shivalik Hing, Agni Hing and Natraj Hing and Food Spices.
12. It is admitted that the profit and loss between the partners are agreed in the manner as mentioned in the clauses of the partnership deed in following manner: i. Sh. Harish Manchanda 10%, ii. Sh. Gulshan Manchanda 17%, iii. Sh. Pradeep Manchanda 33%, iv. Sh. Rahul Manchanda 20% and v. Sh. Varun Manchanda 20%.
13. Further, it is also admitted that Ms Manchanda Brothers had filed a suit thereby invoking Section 134 & 135 of Trade Mark Act, 1999, Section 55 of Copy Right Act for permanent injunction in which the Court of Sh. S.S.P. Laler, Ld. ADJ, in TM No.91/2017 titled Manchanda Brothers Vs. Manchanda Foods against the Manchanda Foods with the prayer to restrain the Sole Prop. Concern from using the trade mark Titli Hing and that the Court vide its order dated 15.12.2017 appointed Local Commissioner to seize articles and thereafter, petitioner moved an application U/s 5 & 8 of the Arbitration Act with the ground that the same is a partnership dispute as per the partnership deed OMP (I) (Comm) No. 195/23 Page No. 8 of 18 and thereafter, the Court vide its order dated 24.01.2018 dismissed the suit of the respondents and thereafter, respondents preferred an appeal CM (M)No. 164/2018 against the said order and vide order dared 15.02.2019 the petition of the impugned order dated 24.01.2018 in TM No.91/2017 was set aside to the extent of the Arbitration Clause and the matter was remand back by the Hon'ble High Court in favor of the Manchanda Brothers, and thereafter the Ld. Trial Court has allowed the application under U/o 39 Rule 1 & 2 of CPC restraining the Petitioner herein from using or infringing the registered trade mark under Manchanda Brothers vide order dated 31.03.2023 passed by Sh.
Ajay Gulati, Ld. ADJ Central District, Tis Hazari Courts Delhi. It is further stated that respondent no.4 is the Sole Registered owner of the Trade Marks Titli Hing, Agni, Shivalik, and Natraj, the registration was applied by Manchanda Brothers, and same was assigned to the Partnership firm, as such the Petitioner nor the respondent no. I to 3 are having any independent rights to use the same either in there own name or in the Sole Proprietorship concern.
14. It is further stated that petitioner is himself engaged in infringing the registered Trade mark of the respondent no. 4 under no. 793881 in Class 30, and passing off and violation of the respondent no.4 M/s Manchanda Brothers rights, which was concealed from the partners and petitioner was running the said business under his own Sole Proprietorship concern M/s Manchanda Foods by unlawful using the same registered trade mark and selling the said product in market by adopting the same, trade mark/label thereby causing the loss to the Firm/respondent no.4 and when injunction was granted against OMP (I) (Comm) No. 195/23 Page No. 9 of 18 him he file present petition as counter blast to restrain the respondent from using the trade mark in question. Thus respondent prayed for dismissal of the instant petition with costs.
15. Arguments were heard from Sh. Vijay K. Sehgal, ld. Counsel for petitioner and Sh. Akhil Mittal, Ld. Counsel for respondents.
16. It is argued by learned counsel for petitioner that petitioner is one of partners of the partnership firm running under the name and style of M/s Manchanda Brothers, who is the registered owner of trademarks Titli Hing, Agni, Shivalik, and Natraj. He further argued that respondents are restraining the applicant from entering into business premises as well as to look after day to day affairs of the business of the partnership firm Manchanda Brothers despite the fact that he is also one of the partners of the said firm. He further argued that respondents are doing the business by selling all the products which are registered in the joint names of the partners of the firm i.e. Manchanda Brothers and are earning huge amount by selling the products. He further argued that since dispute arises between the partners of the partnership firm, therefore, respondents cannot use the aforesaid trademarks, hence, they be restrained from using the aforementioned trademarks till the dispute is decided between the parties and further, local commissioner be appointed to deal with the said matter of the property.
17. On the other hand, learned counsel for respondents argued that since admittedly Manchanda Brothers is the registered owner of the trademarks Titli Hing, Natraj Hing, Shivalik Hing & Agni Hing, therefore, the said firm is every right to use the said trademark for their products. He further argued that petitioner OMP (I) (Comm) No. 195/23 Page No. 10 of 18 had earlier filed a petition under Section 9 of the Arbitration and Conciliation Act 1996 vide TM No. 37/2019 whereby the Court was pleased to appoint Local Commissioner, however, the petitioner never executed the said order, as the objections was filed by the respondents, and the said matter was disposed off by the Court and the said case was based upon the same cause of action and similar relief between the same parties, as such the present petition is barred by the principles of resjudicata and also in view of Section 9 (2) of the Act, being barred by the Limitation. He further argued that respondent has filed the suit with the titled Manchanda Brothers Vs. Manchanda Food invoking Section 134 & 135 of Trade Mark Act, 1999 for permanent injunction in which injunction order has been passed in favour of respondents by the Court of Sh. Ajay Gulati, Ld. ADJ, Central District, Tis Hazari Courts Delhi. Hence, the present petition filed by the petitioner is a counter-blast and in these circumstances, petitioner is not entitled to any relief.
18. I have heard the arguments advanced by the learned counsels for parties and carefully gone through the case file.
19. Plaintiff is seeking interim injunction. The principal for grant of injunction u/s 9 of Arbitration & Conciliation Act is same as in case of grant of injunction under Order XXXIX Rule 1 & 2 CPC. It is well settled that for the grant of an interim relief the plaintiff has to first establish a good prima facie case in its favour beside also showing that the balance of convenience lies in favour of grant of interim relief and that irreparable injury or loss will be caused to the applicant in case no such interim relief is granted. It is also to be kept in mind that unless applications for interim measures are decided expeditiously, irreparable injury OMP (I) (Comm) No. 195/23 Page No. 11 of 18 or prejudice may be caused to the party seeking interim relief.
20. The ambit and scope of the connotation "prima facie" case has been explained by the Hon'ble Supreme Court in the case Martin Burn Ltd. v. R.N Banerjee [AIR 1958 SC 79.] interalia as under:
"A prima facie case does not mean a case proved to the hilt but a case which can be said to be established if the evidence which is led in support of the same were believed. While determining whether a prima facie case had been made out the relevant consideration is whether on the evidence led it was possible to arrive at the conclusion in question and not whether that was the only conclusion which could be arrived at on that evidence. It may be that the tribunal considering this question may itself have arrived at different conclusion. It has, however, not to substitute its own judgement for the judgement in question. It has only got to consider whether the view taken is a possible view on the evidence on the record."
21. Thus, the first requirement is to see whether the plaintiff has been able to establish a prima facie case in its favour warranting passing of an order by way of interim measure, or not. Certainly, the plaintiff is not required to make out a clear legal title but has only to show that there is a substantial question to be investigated and that matters should be preserved in status quo until the question can be finally disposed of.
22. The plaintiff is next required to show that irreparable injury will accrue to it if the injunction is not granted, and that there is no other remedy open to them by which they could protect themselves from the consequences of the apprehended injury. In the leading case of American Cyanamid Co. v. Ethicon OMP (I) (Comm) No. 195/23 Page No. 12 of 18 Ltd. [1975 AC 396.] , the House of Lords pronounced the principle as under:
"the governing principle is that the court should first consider whether, if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction, he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages in the measure recoverable at common law would be adequate remedy and the defendant would be in financial position to pay them, no interlocutory injunction should normally be granted, however strong the plaintiff's claim appeared to be at that stage. If on the other hand, damages would not provide an adequate remedy for the plaintiff in the event of his succeeding at the trial, the court should then consider whether, on the contrary hypothesis that the defendant were to succeed at the trial in establishing his right to do that which was sought to be enjoined, he would be adequately compensated under the plaintiff's undertaking as to damages for the loss he would have sustained by being prevented from doing so between the time of the application and the time of the trial. If damages in the measure recoverable under such an undertaking would be an adequate remedy and the plaintiff would be in a financial position to pay them, there would be no reason upon this ground to refuse an interlocutory injunction."
23. Lastly, the balance of convenience must also be in favour of granting the injunction.
In Dalpat Kumar v. Prahlad Singh [(1992) 1 SCC 719] , the Hon'ble Supreme Court stated that the court while granting or refusing to grant injunction should OMP (I) (Comm) No. 195/23 Page No. 13 of 18 exercise sound judicial discretion to find the amount of substantial mischief or injury which is likely to be caused to the parties, if the injunction is refused, and compare it with that which is likely to be caused to the other side if the injunction is granted. If on weighing competing possibilities or probabilities of likelihood of injury and if the court considers that, pending the suit, the subject-matter should be maintained in status quo, an injunction would be issued. Thus, the court has to exercise its sound judicial discretion in granting or refusing the relief of ad interim injunction pending the suit."
24. As evident from the petition, the petitioner has filed the present petition against the respondent no. 4 Manchanda Brothers which is a partnership firm in which petitioner himself as one of the partners and respondents no. 1 to 3 are other partners.
25. It is also admitted fact that respondent no. 4 "Manchanda Brothers" the partnership firm is the registered owner of the trademarks Titli Hing, Natraj Hing, Shivalik Hing & Agni Hing etc. The registered owner of the trademark is having right to use its trademark as per section 28 of The Trade Mark Act which is reproduce as below:
28. Rights conferred by registration.--
(1) Subject to the other provisions of this Act, the registration of a trade mark shall, if valid, give to the registered proprietor of the trade mark the exclusive right to the use of the trade mark in relation to the goods or services in respect of which the trade mark is registered and to obtain relief in respect of infringement of the trade mark in the manner provided by this Act.
(2) The exclusive right to the use of a trade mark given under sub-section (1) shall be subject to any OMP (I) (Comm) No. 195/23 Page No. 14 of 18 conditions and limitations to which the registration is subject.
(3) Where two or more persons are registered proprietors of trade marks, which are identical with or nearly resemble each other, the exclusive right to the use of any of those trade marks shall not (except so far as their respective rights are subject to any conditions or limitations entered on the register) be deemed to have been acquired by any one of those persons as against any other of those persons merely by registration of the trade marks but each of those persons has otherwise the same rights as against other persons (not being registered users using by way of permitted use) as he would have if he were the sole registered proprietor.
26. In these circumstances , respondent no.4, cannot be restrained from using the aforesaid trademarks merely because there is dispute between the petitioner and the other partners of the respondent no. 4 firm. It is not the case of the petitioner that respondents no. 1 to 3 are using the aforesaid trademark which are registered in the name of respondent no. 4 firm for their personal use or business instead of business use of respondent no.
4. In my view, on this ground alone petitioner is not entitled for relief of injunction restraining the respondents from using the trademarks Titli Hing, Natraj Hing, Shivalik Hing & Agni Hing.
27. Even otherwise on perusal of entire petition it is evident that petitioner has nowhere stated that he intends to initiate the OMP (I) (Comm) No. 195/23 Page No. 15 of 18 arbitration proceedings to decide the dispute between the petitioner and respondents through Arbitrator. As per Section 9 of the Arbitration and Conciliation Act, 1996 under which the present application/petition has been filed, the Court may grant interim relief to a party before or during arbitral proceedings or at any time after the making of the arbitral award. Section 9 of the Act reproduced as below :-
9. Interim measures, etc. by Court.--A party may, before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a court--
(i) for the appointment of a guardian for a minor or a person of unsound mind for the purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters, namely:--
(a) the preservation, interim custody or sale of any goods which are the subjectmatter of the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the subjectmatter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the court to be just and convenient, and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it.
28. Hence, from the said Section 9 of the Act it is evident that OMP (I) (Comm) No. 195/23 Page No. 16 of 18 to obtain any relief under Section 9 of the Arbitration and Conciliation Act a party who is approaching to the Court must state in the application that it has intention to initiate the arbitration proceedings, if a party file an application u/s 9 of the Act before initiation of the arbitration proceedings. Hence, in my view, on this ground alone also petitioner is not entitled for any relief as sought in the instant application. Even otherwise I am also agree with the submissions of respondents' counsel that petitioner has also earlier filed a petition u/s 9 of the Act seeking the same relief vide TM No. 37/2019 titled as "Sh. Pradeep Manchanda Vs. Sh. Harish Kumar Manchanda" and the Court was pleased to appoint local commissioner vide its order dated 11.02.2019. The petitioner in the present application has not mentioned anything about the said petition filed by him and thus, concealed the said material facts from this Court and has not approached before this Court with clean hands. The petitioner has also not explained why he has not initiated the arbitration proceedings despite passing the said interim order by the Court restraining the respondents from using the trade mark in dispute in this case and appointing Local Commissioner . Hence, I am agree with the submissions of learned counsel for respondents that petitioner has no intention to initiate the arbitration OMP (I) (Comm) No. 195/23 Page No. 17 of 18 proceedings and only want to relief of injunction under Section 9 Arbitration Act to restrain the respondents no.1 to 3 to use the Trade Mark registered in the name of their firm so that they allow the petitioner to use the said trade mark for his proprietorship firm.
29. In view of the aforesaid facts and circumstances, in my view, neither a strong prima facie case is made out in favour of the petitioner nor balance of convenience lies in his favour, if injunction is not granted in his favour, hence, no ground is made out to grant relief of injunction restraining the respondents from using trade mark Agni Hing, Shivalik Hing, Titli hing and Natraj Hing or any other relief as sought in the instant application / petition by the petitioner against the respondent. Hence, the application is hereby dismissed being without any merits and disposed off accordingly.
File be consigned to record room.
Pronounced in open Court on 16.11.2023.
(Sanjeev Kumar Aggarwal) District Judge (Commercial Court)-01, Central, Tis Hazari Courts,Delhi.
OMP (I) (Comm) No. 195/23 Page No. 18 of 18