Calcutta High Court
Exxon Mobil Corporation And Anr vs Mr. P.K. Sen on 27 September, 2018
Author: Soumen Sen
Bench: Soumen Sen
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
ORIGINAL SIDE
BEFORE:
THE HON'BLE JUSTICE SOUMEN SEN
G.A. No. 1052 of 2018
C.S. No. 43 of 2018
EXXON MOBIL CORPORATION AND ANR.
VS.
MR. P.K. SEN
For the Petitioners : Mr. Ranjan Bachawat, Sr. Adv.,
Mr. Debnath Ghosh, Adv.,
Mr. Gautam Banerjee, Adv.,
Ms. Adreeka Pandey, Adv.,
For the Respondent : Mr. Soumya Roychowdhury, Adv.,
Mr. Sarosij Dasgupta, Adv., Ms. Labanyasree Sinha, Adv.
Hearing Concluded On : 10/09/2018 Judgment On : 27/09/2018
Soumen Sen, J.:- In an action for infringement and passing off in relation to trade mark "Exxon", the petitioners have filed this instant application, praying, inter alia, for an order of injunction restraining the respondent from using its trade name "Exon".
This action was preceded by a suit for infringement filed by the petitioners before the Delhi High Court. In the said proceeding, initially, an order of injunction was passed on 10th August, 2015. The said order was confirmed on 24th August, 2016. The respondent, in the meantime, filed an application before the Delhi High Court for rejection of the plaint, and/or, in the alternative, return of the plaint due to lack of territorial jurisdiction. One of the grounds for rejection was that in view of Section 53 of the Trade Marks Act, 1999, a permitted user had no right to institute any proceeding for infringement. The petitioner No.2, being a permitted user, had no right to institute any proceedings for infringement and thus the petitioner No. 2 could not avail of Section 134(2) of the Trade Marks Act, 1999.
The said application was rejected.
However, in an appeal preferred by the respondent, the Hon'ble Division Bench in FAO (OS) No.290/2016 & CM No.37465/2016 (P.K. Sen v. Exxon Mobile Corporation & Anr.) reported at 2017 (1) HCC 89 (Del) by a judgment and order dated 4th January, 2017, allowed the appeal and the plaint was returned to the petitioners for filing in the court having jurisdiction in the matter. The Division Bench held that, even if it is assumed that the use of the trade mark by the petitioner No. 2 is the deemed use of the trade mark by the petitioner No. 1, and that the office of the petitioner no. 2 in Delhi is the subordinate/branch office of the plaintiff no. 1, the additional benefit of Section 134(2) of the said Act would not be available to the petitioner No. 1. The petitioners preferred a Special Leave Petition before the Hon'ble Supreme Court. The Hon'ble Supreme Court initially passed an order on 23rd November, 2017, by which the matter was adjourned till 12th December, 2017 in order to enable the learned Counsel representing the respondent to obtain instructions as to whether the respondent would continue not using the mark in a similar manner in future till the application filed by him for registration of the trade mark is decided by the statutory authority. However, subsequently, by an order dated 12th December, 2017, the Special Leave Petition was dismissed. The petitioners were granted three months' time to represent the plaint before the competent authority.
The petitioners have now filed a fresh suit for infringement and passing off on 8th March, 2018 before this Court.
Before entering into the arena of disputes as canvassed by the respective parties in their pleadings as well as during arguments, it is necessary to indicate briefly the nature of the dispute.
The petitioner No. 1 is a Corporation organized and existing under the laws of the State of New Jersey, United States of America and petitioner No. 2 is an Indian subsidiary of the petitioner No. 1 and is also a licensee/permitted user of the trademarks of the petitioner No. 1 in India. The petitioner No. 1 claims to be one of the largest energy companies in the world. The said company was formed on 5th August, 1882 as the Standard Oil Company of New Jersey. The company thereafter changed its name various times and ultimately came to be known as Exxon Corporation in 1972. Petitioner No. 1 further claims to be a world-renowned leader in chemical, petroleum and related petroleum products. Further, the petitioner No. 1 claims that the word "Exxon" is a coined and invented word, which was selected after a tedious study of old lists of names over the years. The petitioner No.1, at present, claims to be one of the largest publicly traded international oil and gas companies. The petitioner No.1 claims to have a long and outstanding presence in India. The word "Exxon" is registered as a trade mark in at least 160 countries, including India. In India, there are over 39 registrations for the word "Exxon" for a wide variety of goods falling in Classes 1 to 6, 9, 11, 12, 16, 17, 19, 22 to 25, 27, 29, 30 and
31. Details of various registrations of the petitioners, in respect of the trade mark "Exxon", have been annexed to the plaint and the petition. The petitioners claim that by virtue of the aforesaid registration of the mark "Exxon", the petitioner No. 1 has exclusive right to use the trade mark in relation to the goods for which they are registered.
The petitioner No. 1 had been selling their products in India under the mark "Exxon" at least since the year 1980 through one of its Group Companies, namely, Exxon Chemicals Eastern Inc., which was incorporated on January 01, 1980.
The goods manufactured by the petitioner No. 1 were supplied by one of its Group Companies, namely, Exxon Chemicals International Supply, Hong Kong to India including Kolkata at least since 30th November, 1982. The customers of petitioners include Ceat Tyre, Apollo Tyre, Dunlop India, Goodyear, Vikrant Tyre, J.K. Industries, Bombay Tyre International Ltd. The petitioners have disclosed the invoices to show that the goods were supplied to the said customers by Exxon Chemicals International under the trade mark "Exxon". The petitioner No.1 has been supplying the goods to M/s. Dunlop India at Mirza Ghalib Steet, Kolkata-700016 way back from 30th November, 1985.
The petitioners in order to protect their mark "Exxon" have filed various proceedings in courts all over India and in some of such proceedings, the petitioners' mark "EXXON" was held to be a well- known trademark. The mark "EXXON" is not only used by the petitioners as their trade mark but is also used as part of the corporate name of petitioner No.1 and its Group Companies.
The petitioner No. 1 also owns and maintains the website, www.exxonmobil.com since November, 1988 and also owns the domain name www.exxon.com, since January, 1991. The petitioner No. 1 is a Fortune 500 Company and it has received numerous awards, honours and recognitions which are almost more than 50 in number; details whereof have been furnished in Schedule Y of the petition. The petitioner No. 1 held the second position as Fortune US 500 Company in the year 2014. The petitioners have disclosed the sales and operative revenue of the goods sold under the mark "Exxon" for the years 1971 and 1972 aggregating to USD 20,361,722,000 and USD 22,070,578,000 respectively. The total sales and other operating revenue of the petitioner No. 1 in million dollars for the year 1978 to 1982 have also been disclosed of the petition. The revenue and other income of the petitioner No. 1 for the year 2005-07 have also been furnished in the petition.
The summary statement of account disclosed in the petition shows that income after taxes for the years 2005, 2006 and 2007 are 36130, 39500 and 40610 in million dollars respectively.
In and around February, 2015, petitioner No. 1 came across a website of the respondent 'www.exonengineering.com', wherefrom petitioner No. 1, for the first time, came to know that the respondent is seeking to manufacture and supply all kinds of fire extinguishers and is engaged in maintenance of fire extinguishers. The respondent is also using the mark "EXON" both as part of its trading name and also its trade mark. Further, the respondent was using the word "Exon" in his email id: [email protected]. In such circumstances, a cease and desist notice was issued on 12th February, 2015 followed by a further notice dated 2nd April, 2015. The respondent, however, did not respond to the said notice. However, the domain name of the respondent "ExOnEngineering.com" had expired on 10th September, 2015 and was not renewed.
The petitioners claim that adoption of the mark "Exon" as a trademark and also as part of its corporate name and/or trading name by the respondent is wrongful and illegal. The unauthorised adoption of the said trademark is an attempt to trade upon the extraordinary goodwill and reputation of the petitioner. Moreover, the petitioners are the prior users of the mark "Exxon" and the respondent is the subsequent user of the same.
The petitioners also contended that the respondent has no user of the mark "Exon" at all. In fact, it would appear from the status report of the application made by the respondent for registration of the said mark that "Exon", as 'proposed to be used' in relation to the fire-fighting equipments, has been abandoned. With a view to protect the trade mark "Exxon", the petitioners initially filed the suit at Delhi.
After the dismissal of the special leave petition the instant proceeding has been initiated.
I have already narrated the proceedings before the Delhi High Court.
In the Delhi proceeding, the defendant has filed an affidavit-in- opposition which is substantially similar to the affidavit-in-opposition filed in this proceeding. In fact, the affidavit filed in this proceeding is more concise. The respondent has filed the said affidavit to show its claim as prior user.
In the affidavit, the respondent has stated that the respondent is carrying on business under the name and style of "M/s. Exon Engineering Corporation" as a sole proprietor thereof. The respondent is engaged in a business of manufacturing fire extinguishers since 1982 under the name and style of "Exon Engineering Corporation". The respondent had obtained its Sales Tax Registration "for a dealer having his place of business in West Bengal" bearing No.ST/10533 dated 2nd November, 1983. The said business is also permanently registered as a Small Scale Industrial Unit with the Directorate of Cottage and Small Scale Industries, as would be evident from the certificated dated 30th May, 1986. In the usual course of business, the respondent had submitted sample fire extinguisher manufactured by the respondent to the Regional Testing Centre, Eastern Region, Ministry of Industry, Government of India. The respondent has disclosed a test report issued by the concerned Ministry dated 20th January, 1987. In the year 1985, the respondent was registered with the National Jute Manufacturers Corporation Ltd. as a supplier of fire fighting equipment, a copy of the registration certificate dated 27th February, 1985 has been annexed to the affidavit. The respondent has also disclosed the enlistment letter dated 14th September, 1987 as a supplier of fire extinguishers with the Security Department, Head Office of Allahabad Bank. The respondent has also disclosed the licence issued by the South Dum Dum Municipality under the relevant provisions of the Bengal Municipal Act XV of 1932 for the years 1989 till 2005. The respondent has also disclosed a notice of demand issued by the Income Tax Officer under Section 156 of the Income Tax Act, 1961 dated 4th November, 1985. The respondent claims that its business has also received registration with ISO 90001:2008 and a registration certificate dated 24th December, 2014 has been disclosed in the affidavit. On the basis of the aforesaid documents, the defendant has made a claim of prior user of the mark 'Exon' since 1982.
It is stated by the respondent that the petitioner No.1 applied for and obtained registration of the mark 'Exxon' in Class 1 goods on October 29, 1971 which expressly excluded "fire fighting compositions"
from its scope. Further, such mark was registered as "proposed to be used". On April 4, 1988, the petitioner No.1 yet again applied for and obtained registration of the said mark in respect of Class 1 goods, this time including "fire fighting compositions", however, such mark was still registered as "proposed to be used".
Thus, the respondent stated, the "Exxon" mark was not registered in respect of "fire fighting compositions" until 1988 and thereafter, although such mark was registered as "proposed to be used" in respect of "fire fighting compositions", such mark has admittedly never been used by the petitioner No. 1 in respect of such goods till date.
The petitioner No. 1 also applied for and obtained registration of the "Exxon" mark in respect Class 9 goods on January 17, 1974; such registration expressly excluded "life saving apparatus". It is submitted by the respondent that since the petitioner No. 1 consciously applied for and obtained registration in respect of only a narrow description of goods in both Class 1 and Class 9, the petitioner No. 1 cannot be allowed to extend such registration, or the statutory effects thereof, to other goods in those categories for which registration was not obtained in the first place. There has been no user of the mark at all. In view thereof, the petitioners are not entitled to any relief.
Mr. Ranjan Bachawat, the learned Senior Counsel appearing on behalf of the petitioners has submitted that the petitioner No.1 is the registered proprietor of the mark "Exxon" and has exclusively used the said trade mark in relation to goods of which the mark is registered and obtained reliefs in respect of infringement of trade mark "Exxon". Mr. Bachawat has referred to Section 28 of the Trade Marks Act, 1999 and submits that by virtue of such registration, the plaintiff No. 1 has exclusive right to the use of the said trade mark to the exclusion of all. Mr. Bachawat submits that the judicial decisions with regard to the trade mark "Exxon" has clearly recognized that the said mark is a well- known and world-wide reputed mark and has a reputation in India. Mr. Bachawat has referred to the host of decisions passed by different Courts all over the country being Annexure I of the Petition and submits that each of the said decisions have recognized that "Exxon" mark is an invented and a coined word and has a reputation in India. The said orders reflect that the petitioners have a record of diligence in enforcement of "Exxon" trade mark/trading style/domain name in India where third parties have been restrained from using the said mark. The said decisions would also establish that the respondent's use of "Exxon" trade mark as a part of his trade name, email address as well as on the goods is an infringement of the petitioner No.1's well-known trade mark and trading style and use of the trade mark "Exon" by the respondent is bound to create an association with the petitioners in the minds of the consumer and in the course of trade when, in fact, no such association exists.
Mr. Bachawat has referred to Sections 29(2) and 29(4) of the Trade Marks Act, 1999 and submits that the use of the mark "Exon" by the respondent is an act of infringement. The use of the mark "Exon" by the respondent is intended to take unfair advantage of and is detrimental to the distinctive character and repute of the petitioner No. 1's registered trade mark. Moreover, the petitioner No.1 is the prior user of the mark "Exxon" and is entitled to an order of injunction on the strength of prior use only. The learned Counsel submits that it cannot be disputed that the mark Exxon has been continuously and exclusively used as a trade mark and trading name since 1967 whereas the mark "Exon" as a trade mark of the respondent was filed in the year 1989 as proposed to be used. Mr. Bachawat in this regard has relied upon the decision of the Hon'ble Supreme Court in Syed Mohideen v. Sulochana Bai reported at 2016 (2) SCC 683 (Paragraphs 30.4, 30.5 and 31.2). It is submitted that an action of passing off is available to the owner of the distinctive trade mark and the person who, if the word or name is an inventive word, invented and used it. If two rivals claim to have individually invented the same mark, the trader who is able to establish prior use succeeds. The question that the Court in such cases put is "who gets first". The learned Counsel refers to the decisions of the Hon'ble Supreme Court in Satyam Infoway Ltd. v. Sifynet Solutions (P) Ltd. reported at 2004 (6) SCC 145 (Paragraph 13) and N. R. Dongre v. Whirlpool Corporation reported at 1996 (5) SCC 714 and submits that the Supreme Court has always recognized trans-boarder reputation and the "first in the market"
principle, that is to say, prior user. Furthermore, the respondent has failed to explain the adoption and use of the mark "Exon" in the affidavit. On such considerations, it is submitted that the petitioner No. 1 is entitled to protect its well-known trade mark "Exxon".
Mr. Bachawat has submitted that the instant suit has been filed on March 8, 2018 within the period mentioned in the order dated 12th December, 2017. The learned Senior Counsel has submitted that objections with regard to the Special Power of Attorney have now become academic as a Special Power of Attorney has already been executed by Petitioner No.1 authorising Ms. Veena Poolakal to file, prosecute, conduct any suit and proceeding for Petitioner No. 1 and to sign, verify and affirm pleadings on its behalf. The said Power of Attorney has been duly signed by Randall M Ebner, Vice President and General Counsel for the Petitioner No. 1. The said documents have been duly apostilled in accordance with law. Similarly, another Special Power of Attorney has been executed by Petitioner No.1 in favour of Mr. Padam Khaitan of Khaitan & Co to file and prosecute C. S. No.43 of 2018 and to appoint counsels to represent Petitioner No. 1.
Mr. Bachawat has submitted that the claim of prior user by the respondent is not established from the document disclosed in the affidavit. The documents annexed thereto are sales tax registration of the respondent, trade licence issued by South Dum Dum Municipality, notice of demand issued under Section 156 of the Income Tax Act, 1961, Certificate issued by a bank, ISO Certificate of Registration and Certificate issued by NSIC. None of these documents evidence any use of the mark "Exon" by the respondent. The respondent has allegedly got its ISO Registration Certificate on 24th December, 2014 and NSIC Registration Certificate on 12th June 2001, which was valid till 23rd December, 2017 and 30th March, 2004 respectively. The aforesaid documents clearly establish that there has been no user of the mark "Exon" by the respondent prior to the petitioners' and, in any event, has not been used as a trademark or domain name until very recently, i.e. 2015.
In any event, the respondent has abandoned its trademark 'Exon'. The domain name of the respondent, www.exonengineering.com, had expired on 10th September, 2015. The respondent has been using the mark "SKON" and not "Exon" as part of its trading name. Hence, the balance of convenience is fully in favour of the petitioners for passing the order of injunction.
The learned Senior Counsel for the petitioners has also submitted that, in the event a passing off action is instituted to defend the exclusivity of a corporate name, it would not be open to another trader to justify use on the ground that he is using the same corporate name as his business identity in respect of a business entirely different from petitioner. Even where the field of activity in which petitioner and respondent are engaged is remote from each other, it is possible for deception to occur if the name or the mark used by petitioner is highly distinctive or if petitioner's mark or name is well known. Reliance is placed on Sony Kabushiki Kaisha Vs. Mahaluxmi Textile Mills reported at 2009 (1) CHN 852 (FB) (Paragraphs 17 and 20) (hereinafter referred to as "Sony Kabushiki Kaisha"). Mr. Bachawat submits that the Full Bench in Sony Kabushiki Kaisha (supra) followed the ratio of the Hon'ble Supreme Court in Mahendra & Mahendra Paper Mills Ltd. vs. Mahindra And Mahindra Ltd reported at 2002 (24) PTC 121. The plaintiff therein was dealing in automobiles and the defendant therein was running a paper mill. Considering different authorities on the subject, the Hon'ble Supreme Court declined to interfere with the order of the High Court granting interim injunction restraining the defendant from using the name "Mahendra" or "Mahendra & Mahendra".
Mr. Bachawat has submitted that in case of distinctive marks common field activity is not necessary to succeed in an action for infringement and passing off. The learned Senior Counsel has relied upon the decision of Exxon Corporation vs. Exxon Insurance Consultants International Ltd reported at (1981) 2 AII ER 495 which has been followed in K.G. Khosla Compressors Ltd. vs Khosla Extrakting Ltd. & Ors. reported at AIR 1986 Delhi 181 (paragraph
14). Mr. Bachawat has also relied upon Montari Overseas Ltd. vs. Montari Industries Ltd. reported at 1996 (16) PTC 142 (DB) and Aktiebolaget Volvo of Sweden vs. Volvo Steels Ltd. of Gujarat (India) reported at 1998 (18) PTC 47 (DB) to demonstrate that common field activity is not essential to succeed in an action for infringement or passing off.
It is submitted that the respondent has not responded to the cease and desist notices of petitioner issued on 12th February, 2015 and 2nd April, 2015. It is well settled that once the respondent was put to notice in relation to the claim of petitioner in relation to the mark "Exxon" and its user since 1967, no surprise could be cast to respondent by filing the suit by petitioner to enforce its claim for infringement. In this context, reliance is placed on Allergan Inc. Vs. Milment Oftho Industries & Ors. reported at AIR 1998 CAL 261. It is submitted that in case of infringement of a registered trademark, it is well settled that injunction must follow and mere delay in bringing an action is not sufficient to defeat grant of injunction in such cases. Grant of injunction also becomes necessary if it prima facie appears that the adoption of the mark by respondent was dishonest. In this connection, Mr. Bachawat has referred to Midas Hygiene Industries P. Ltd. & Anr. Vs. Sudhir Bhatia & Ors. reported at (2004) 3 SCC 90 (Paragraph 5).
The learned Senior Counsel has also referred to Amar Nath Chakraborty v. Dutta Bucket Industries reported at 2005 (2) CHN 278 (Paragraph 20) and submits that once it is established that the mark of the respondent is identical to petitioner and petitioner has been using the mark from an earlier point of time, the court has no other alternative, but to grant injunction restraining respondent from using the trademark unless respondent can show positive act of petitioner consenting to use of the trademark by respondent.
An action for passing off is a common law remedy and an action in deceit under the law of Torts. Thus, every time when a person passes off its goods as that of another, he commits the act of deceit. Similarly, whenever a person commits breach of a registered trademark of another, he commits a recurring act of breach or infringement of trade mark giving rise to recurring and/or fresh cause of action on each time of such infringement to the party aggrieved. In such scenario, there is no bar in filing fresh suit for every act of infringement by respondent. In this regard, reliance is placed on Bengal Waterproof v. Bengal Waterproof Manufacturing Company reported at (1997) 1 SCC 99 (Paragraph 10).
Mr. Bachawat submits that the petitioners on return of the plaint can either challenge the order in an appellate forum or represent the plaint to a court having territorial jurisdiction to entertain the suit. In substance, it is a suit filed subject to limitation, pecuniary jurisdiction and payment of court fees. The said suit cannot be dismissed on the ground that petitioner has made averment which did not find place in the original plaint. It is not necessary for the plaintiff to seek amendment of plaint under Order VII Rule 17 of CPC. At best, it can be treated as a fresh plaint and the matter can be proceeded with in accordance with law. Mr. Bachawat has, in this context, referred to Hanamanthapa & Anr. V. Chandrashekharappa & Ors. reported at (1997) 9 SCC 688 (Paragraph 3), Ahnedally v. Daulat Akbarali reported at 2004 (2) Mah L.J. 210 (Paragraphs 25 to 29) and Vishnu Horticultural Pvt. Ltd. & Anr. Vs. Shampiyan Viniyard Ltd. & Ors. reported at 2010 (2) Mah L.J. 244 (Paragraph 13) and submits that the aforesaid decisions have reiterated the said principle.
On verification of pleading and Special Power of Attorney it is submitted that from a reading of Order VI Rule 14 read with Order XXIX Rule 1 of CPC, it would appear that even in absence of a formal Letter of Authority or Power of Attorney having been executed by a person referred to in Order XXIX Rule 1 of CPC, by virtue of the office which he holds, he can sign and verify the pleadings on behalf of a corporation. In addition thereto and de hors Order XXIX Rule 1 of CPC, a company can duly authorize any person to sign a plaint or written statement on its behalf and this would be regarded as sufficient compliance with the provisions of Order VI Rule 12 of CPC. A person may be expressly authorised to sign the pleadings on behalf of the company, for example, by the Board of Directors of a company by passing a board resolution to that effect or by a Power of Attorney being executed in favour of any individual. In absence thereof and in cases where pleadings have been signed by one of the officers, the corporation can ratify the action of its officer in signing the pleadings. Such ratification can be express or implied. The court can, on the basis of the evidence on record, and after taking all circumstances of the case, come to a conclusion that the corporation has ratified the act of signing of its pleadings where suits are instituted or defended on behalf of the corporation. Procedural defects which do not go to the root of the matter should not be permitted to defeat a just cause. There is sufficient power of court under CPC to ensure that injustice is not done to any party, who has a just cause and substantive right should not be allowed to be defeated on account of procedural irregularity, which is curable. In this regard reliance is placed on United Bank of India v. Naresh Kumar reported at (1996) 6 SCC 660 (Paragraphs 9 and 10) (hereinafter referred to as "UBI"). Similar is the view of Bombay High Court in All India Reporter Ltd. Vs. Ramchandra Dhondo Datar reported at AIR 1961 Bom 292 (DB) (Paragraphs 12 to 15, 19 and 24).
Mr. Bachawat submits that N.R. Dongre & Ors. Vs. Whirlpool Corporation & Ors. reported at AIR 1995 Del 300 (hereinafter referred to as "N.R. Dongre") is an authoritative pronouncement on trans-border reputation. Attention is drawn to Paragraph 23 of the said decision. It is submitted that a product and its trade name transcends the physical boundaries of geographical region and acquires a trans- border or overseas or extra-territorial reputation not only by import of goods, but also by advertisement. The knowledge and the awareness of the goods of a foreign trader and the trademark can be available at a place even where the goods are not being marketed and consequentially not used.
Mr. Bachawat submits that is a clear case of infringement of a well-known registered trade mark and the proprietary right of the petitioners over the mark "Exxon" needs to be protected.
Per contra, Mr. Soumya Roychowdhury, the learned Counsel appearing on behalf of the respondent has submitted that the petitioners are not engaged in the business of manufacture or sale or supply of fire extinguishers. The petitioner No.1 has no business in India. The averments made in the plaint and petition show that the petitioner no. 2 is a permitted user of the mark "Exxon" registered in the name of the petitioner No. 1 and is engaged in the business of automotive and industrial lubricants. However, such lubricants are marketed and sold under the trademarks "MOBIL" and "MOBIL 1". The invoices disclosed only show that "Exxon" branded butyl products are sold in India.
Mr. Roychowdhury contends that it has also been admitted in the petition that petitioner No. 2 currently conducts industrial and automotive lubricant business, which are sold in India under the trademarks MOBIL and MOBIL 1. There is no similarity whatsoever between the said goods and the goods sold by the respondent. No case has also been made out that the said goods are sold through the same trade channel. The entire premise of the petitioner's case is that goods are similar or cognate goods but during the course of hearing, the said case was given up consciously by the petitioner. It is trite law that in the course of arguments, if a different case is argued, which is not made out in the plaint, the plaint is required to be amended. The same has not been done in the instant case.
It is not open for the petitioner to contend in the same breath that the goods are similar and dissimilar. An inconsistent case is not permitted to be made out in the plaint. The main thrust of the petitioner's case has been its alleged rights under Section 29(4) and 29(5) of the Trademarks Act, 1999. To attract the provisions of Section 29(5), the petitioner needs to show that it had registration in respect of fire extinguishers prior to the use made by the Respondent. In the instant case, admittedly, the petitioner has no registration in respect of fire extinguishers and hence Section 29(5) has no application to the instant case. In this regard, reliance has been placed on Kamdhenu Ispat Limited v. Kamdhenu Pickles & Spices India Pvt. Ltd. and another reported at 2011 (46) PTC 152.
The learned Counsel submitted that the respondent is the "first in the market" having manufactured and marketed fire extinguishers since 1982. Reliance is placed on Section 34 of the Trade Marks Act, 1999 and also on a judgment of the Hon'ble Supreme Court in Neon Laboratories Ltd. Vs. Medical Technologies Ltd. & Ors. reported at 2016 (2) SCC 672 (paragraphs 9 and 11) for the proposition that the "first user rule" is a seminal part of the Trade Marks Act, 1999.
Mr. Roychowdhury has submitted that the decision in N.R. Dongre (supra) is no more good law in view of the pronouncement by the Hon'ble Supreme Court in Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd. & Ors. reported at (2018) 2 SCC 1. According to Mr. Roychowdhury, the law on trans-border reputation has undergone a complete change and what is now being emphasized is the territoriality principle. In a situation where the petitioners claim trans- border reputation, a foreign plaintiff, would be required to furnish adequate evidence of the fact that it had acquired a substantial goodwill in the Indian market. The goodwill acquired in other territories would be of no consequence in another country. Mr. Roychowdhury submits that it has been specifically stated in the said judgment that if goodwill or reputation in the particular jurisdiction (in India) is not established by the plaintiff, no other issue really would need any further examination. The reason given by the defendant for adoption of the mark would also be irrelevant in such a case. It is further submitted that in the said decision, it has been held that advertisements made in various magazines the world over and availability of data and information disseminating portals and information in the internet even if accepted would not be a safe basis to hold the existence of necessary goodwill and reputation of the products in the Indian market at the relevant point of time. It is submitted that the petitioners, in the instant case, have failed to establish that they have acquired any goodwill or reputation in relation to any fire extinguishers.
The instant plaint and connected petition is devoid of any pleading in support of the averment that the petitioners have been the "prior user" of the "Exxon" mark in respect of fire extinguishers or allied goods. There is no pleading or document to substantiate sale of "Exxon" branded goods in India. Similarly, there is no document on record to substantiate that the "Exxon" mark is "a well known mark" in India or that the said mark has a substantial reputation or goodwill in the Indian market, which is required as an ingredient under Toyota Jidosha Kabushiki Kaisha (supra) to establish an action of passing off. The petitioners have failed to establish by any documentary evidence that the use of the word "Exon" by the respondent is bound to create an association of the goods marketed by the respondent with those of the petitioners in minds of prospective consumers.
It is further contended on behalf of the respondent that four things have happened subsequent to the use of the mark "Exon" by the respondent. Firstly, the petitioner no. 2 was incorporated in the year 1994. Secondly, the petitioner No.1 owns and maintains a website, www.exxonmobil.com since November 25, 1998. Thirdly, the petitioner No. 1owns a domain name www.exxon.com since January, 1991 and fourthly, the petitioner No.1 applied for registration of the label mark "Exxon" in respect of fire extinguisher as "proposed to be used" on April 4, 1988.
Mr. Roychowdhury submitted that the fact that the petitioners do not manufacture fire extinguishers and have never used the mark "Exxon" with regard to fire extinguishers is an admitted position. From the aforesaid, it would be evident that the respondent is the prior user of the name "Exxon" with regard to manufacture and sale of fire extinguishers. It states that nothing in the Trademarks Act shall entitle the proprietor or registered user of a registered trademark to interfere with or restrain the use by any person of a trademark identical with or merely resembling it in relation to goods or services which that person or a predecessor in title of his has continuously used that mark from a date prior to the use of the first mentioned trademark in relation to those goods or services be the proprietor or a predecessor in title of his.
The facts in the N.R. Dongre case (supra) are also completely different. In the N.R. Dongre case (supra) both the defendant and the plaintiff were selling washing machines under the same name. In this case, the goods are completely different. The N.R. Dongre judgment (supra) was passed at a time when the Trademarks Act, 1999 was not there and it was a judgment passed when the Trade and Merchandise Act, 1958 was in force. The Trademarks Act, 1999 has brought about a lot of changes in Section 29. After Section 29(1) and 29(2), Sections 29(3) to 29(9) has been introduced. Section 29(4) deals with well known trademarks. To attract the provisions of Section 29(4), one needs to satisfy condition (a), (b) and (c) of Section 29(4). The requirements under the Section are conjunctive and not disjunctive. A very high degree of reputation in India is one of the criterions which is required to be fulfilled along with the other criteria. In the instant case, the petitioner has failed to establish any use of its mark with regard to fire extinguishing compositions or fire extinguishers in India and hence the question of it having any reputation cannot and does not arise. The petitioner in this case, in order to succeed in India, was required to show that it had a very high degree of reputation in India prior to commencement of use by the Respondent of the mark in respect of fire extinguishers.
The learned Counsel for the respondent contends that the petitioner has failed to disclose or show any use in India prior to the use made by the Respondent. Reliance was placed on a decision of the Hon ble Supreme Court reported in Corn Products Refining Co. vs Shangrila Food Products Ltd. reported at AIR 1960 SC 142 for the proposition that mere registration of a mark and existence of the same in the register does not prove its user at all. It is possible that the mark may have been registered but not used. It is not permissible to draw any inference as to their user from the presence of the marks on the register.
In the instant case, all the registrations disclosed are shown as proposed to be used and no documents have been disclosed showing actual user of the mark.
It is also trite law that the Trademarks Act, 1999 does not permit hoarding of trademarks. Reliance is placed on Paragraphs 47 and 48 of Vishnudas Trading As Vishnudas Kishendas Vs. Vazir Sultan Tobacco Co. Ltd., Hyderabad & Anr. reported at 1997 (4) SCC 201. It is submitted that similar view has been expressed by the Hon'ble Supreme Court in Neon Laboratories Ltd. (paragraph 10) (supra).
Section 48 of the Trade Marks Act, 1999 read with Section 2(1)(r) of the said Act, only applies to registered users. The petitioner no. 2 is a permitted user of the marks registered in favour of the petitioner No.1. Even if the pleadings contained in the instant petition are taken to be true and correct (without admitting them to be so), the petitioners' case can at best be that of an unregistered user using the said marks in India for marketing certain goods, having no similarity with the goods marketed by the respondent. Reliance is placed on K.R. Beri and Co. Vs. The Metal Goods Mfg. Co. Pvt. Ltd. reported at AIR 1980 Del 299 (paragraph 15 to 19) and K.R. Jadayappa Mudaliar & Ors. Vs. K.B. Venkatachalam & Anr. reported at (1990) 1 MLJ 119 (paragraph 18 to 20) for the proposition that use of a mark by an unregistered permitted user thereof cannot be deemed to be, or construed as, use by the registered user of such mark.
Mr. Roychowdhury submits that no right vests in a proprietor who has merely blocked the Registrar. It is submitted that the registration of the mark 'Exon' in respect of Classes 1 and 9 goods would show that the petitioner has obtained registration in respect of only a narrow description of goods in both the clauses and, accordingly, the petitioner No.1 should not be allowed to take advantage of such registration in relation to other goods mentioned in the said clauses for which registration admittedly was not obtained. In this context, the learned Counsel has placed reliance on a decision on a decision of the Hon'ble High Court at Bombay in Indchemie Health Specialties Pvt. Ltd. Vs. Intas Pharmaceuticals Ltd. reported at 2015 (6) Mah. LJ 324 (paragraph 8) for the proposition that when a mark is sought to be registered for a particular class of goods, and the intending proprietor thereof specifically excludes a particular goods (in such category) from the ambit and purview of his application for registration, the effect of such narrow description of goods is that only a commensurate narrow scope of protection can be afforded to the proprietor thereof.
Apart from the merits of the dispute Mr. Roychowdhury has also raised preliminary objection with regard to the institution of the suit. The learned Counsel has submitted that in terms of the order passed by the Hon'ble Supreme Court, the plaintiff was given three months' time to represent the said plaint before the competent authority within a period of three months from the date of the said order.
In the garb of "re-presenting the plaint before this Court the petitioners have, in reality, presented and instituted a "new plaint"
replete with additional averments and prayers which were absent in the plaint originally filed before the Delhi High Court.
The learned Counsel submitted that the plaint filed before this Court is substantially different from the one filed before the Hon'ble Delhi High Court. An impression has been sought to be given that the changes to the plaint are merely ornamental and have been done for the purposes of formatting. On this ground alone no order should be passed in favour of the petitioners. Reliance is placed on a decision in St. George Shipping Co. Ltd. vs M.V. "Irene P" A Foreign Flag reported at AIR 1999 Bom 280 (paragraphs 20 to 23) for the proposition that it is both illegal and improper to alter averments in "a re-presented plaint".
The learned Counsel for the respondent also contends that the plaint was not re-presented within 90 days and was presented much later and hence is clearly barred in view of the order passed by the Hon'ble Supreme Court.
Mr. Roychowdhury further submits that the verification is in contravention of the provisions of the Commercial Courts Act, 2015 Order 2 Rule 1 and Order 6 Rule 15A of the Code of Civil Procedure, 1908. The plaint has been verified by a person who is neither a Secretary nor a Director nor any other principal officer nor an employee of the petitioners.
The purported Power of Attorney signed on behalf of the petitioners respectively, authorising Ms. Veena Poolakal to verify the plaint and affirm the affidavit in support of G.A. No.1052 of 2018 suffers from material defects and cannot be regarded as a Power of Attorney at all.
The statements contained in the plaint and in the instant petition have been verified and affirmed as being true to the knowledge of the said Attorney.
The "Verification" and "Affidavit" to the plaint do not disclose the professional relationship of Ms. Veena Poolakal with either of the petitioners.
The purported Constituted Attorney has no personal knowledge of the facts of the case, and hence could not have verified or affirmed Paragraphs 1 to 8, 11 to 17, 21, 24 to 27, 29 and 30 of the plaint have been verified as true to the knowledge of the "Constituted Attorney". The same could not have been verified by her as true to knowledge The provisions of Order XXIX, Rule 1 not having been complied with, the instant suit and connected application is liable to be dismissed at the threshold. Reliance is placed on an unreported judgment passed by this Hon'ble Court in C.S. No.255 of 1994 (Sony Kabushiki Kaisha -Vs- Sony Trade Links (India) Pvt. Ltd.). 2015 SCC OnLine Cal 1332 @ 1334 to 1338.
The copies of the documents purporting to be Special Power of Attorneys, suffer from material defects. Khaitan & Co., Solicitors & Advocates, have not been authorised to file the instant plaint and petition on behalf of the petitioners. Neither does the purported Power of Attorney holder have any right to appoint Khaitan & Co. to file the instant suit. The act of the purported Constituted Attorney in verifying and affirming such plaint and petition, and the act of Khaitan & Co. in filing such suit, has not been ratified by the present documents, purporting to be the Special Power of Attorneys.
The said Power of Attorney dated 23rd February, 2018 given by the petitioner No.1 to Ms. Veena Poolakal, has been signed by one Shawn E. Forster, "Attorney-in-Fact". No Board Resolution passed by the Board of Directors of Exxon Mobil Corporation, authorizing the said Attorney-in-Fact to delegate such powers, is either annexed to such Power of Attorney or mentioned in the recitals thereof. Further, the petitioners have failed to produce any document to show that such Attorney-in-Fact is an employee or an officer of the petitioner No.1.
In absence of a specific resolution of the Board of Directors authorizing such Attorney-in-Fact to delegate powers on behalf of the Board, no value whatsoever can be placed on the instant Power of Attorney. Reliance is placed on the definition of the term "Attorney-in- Fact" in Black's Law Dictionary, 8th Edition at page 294 which reads:
"Attorney in fact: A private attorney authorised by another to act in his place and stead, either for some particular purpose, as to do a particular act, or for the transaction of business in general, not of a legal character. This authority is confirmed by an instrument in writing called a "letter of attorney" or more commonly a "power of attorney".
Special Power of Attorneys executed in favour of Mr. Padam Khaitan, Partner, Khaitan & Co. and in favour of Ms. Veena Poolakal, both dated July 23, 2018 having effect from July 25, 2018 would not show that the Board of Directors of the Company have not ratified the past acts done on behalf of the said corporation, the petitioner No.1. From these two purported documents, it would be evident that at the time of filing of the suit, neither the person filing the suit nor the Advocates had the authority to do so. The petitioner No.1 being a corporation can only authorise a person through a Board Resolution which is absent in the instant case.
The respondent submits that these two purported documents, make it evident that at the time of filing of the suit, neither the person filing the suit nor the Advocates had the authority to do so. It is trite law that such lack of authority cannot be subsequently cured.
Mr. Roychowdhury submits that it is trite law that an illegal act cannot be legalised subsequently. Ratification is of no avail in cases where the original act was void ab initio and illegal. These purported documents cannot be utilized to authorize subsequently an unauthorized person to institute suits on behalf of the corporation. Reliance is placed on a judgment of the Lahore High Court in Notified Area Committee, Okara Vs. Kidar Nath & Ors. reported at AIR 1935 Lahore 345 in support of the said proposition.
On such considerations, the defendant has prayed for dismissal of the petition.
In reply, Mr. Bachawat has submitted that there is no reason why the test of 'trade connection between different goods' should not apply where the competing marks closely resemble or are identical to each other. Reliance has been placed on Corn Products Refining Co. vs Shangrila Food Products Ltd. reported at AIR 1960 SC 142 (paragraph 21) in support of this proposition.
The "first in the market" test as reiterated in Neon Laboratories (supra) has always enjoyed pre-eminence. It follows and approves the ratio laid down in N.R. Dongre v. Whirlpool Corporation reported at (1996) 5 SCC 714 and Milmet Oftho Industries v. Allergan Inc. reported at (2004) 12 SCC 624. In Whirlpool (supra), the worldwide prior user was given preference and predominance over the registered trademark in India of the Defendant. In Milmet (supra), the marks of pharmaceutical preparation were similar but the prior user worldwide had not registered its mark in India whereas its adversary had done so. The Supreme Court approved the grant of an injunction in favour of the prior user.
It is submitted that in Toyota (supra) the plaintiff had acquired registration in India in different classes for its trademarks 'TOYOTA', 'TOYOTA INNOVA' and 'TOYOTA DEVICE' during the years 1989-2003. So far as India is concerned, the Plaintiff had not obtained registration of the mark 'Prius' in the Indian jurisdiction. However, the car was displayed in the car shows in Delhi and Bangalore held in the year 2009 and it was formally launched in India in the year 2010. In the present case the plaintiff herein has obtained registration of the word mark EXXON in India way back on the year 1967.
Mr. Bachawat points out that in Toyota (supra), according to the Plaintiff, in the year 2009, it discovered that the Defendants had got the mark 'Prius' registered way back in the year 2002-2003 for all types of auto parts and accessories and has been using the said trade mark in carrying out their trade in such auto parts and accessories. In the present case the defendant has not obtained registration of the mark EXON and has abandoned its application for registration.
Moreover, the Plaintiff in the Toyota case had approached the Trade Mark Registry for cancellation of the registered trade mark of the Defendants and in the said proceeding the Defendants were restrained from using the Plaintiff's registered trademarks TOYOTA and INNOVA.
The learned Senior Counsel has submitted that in Toyota (supra) it has been clearly stated that a foreign claimant must show that it has a significant goodwill, in the form of customers, in the jurisdiction, but it is not necessary that the claimant actually has an establishment or office in this country. It could be enough if the foreign claimant could show that there were people in this jurisdiction who, by booking with, or purchasing from, an entity in this country, obtained the right to receive the claimant's service abroad and, in such a case, the entity need not be a part or branch of the claimant, it can be someone acting for or on behalf of the claimant. If there are customers for the claimant's products in that jurisdiction, then the claimant stands in the same position as a domestic trader.
The learned Senior Counsel has submitted that the two-judge bench decision in Toyota (supra), which held that judicial and academic opinion all over the globe seems to be in favour of the territoriality principle and the said principle should apply to this country, may not be the correct view and is contrary to the ratio laid down by the earlier Supreme Court judgements of similar strength that "first in the world market should prevail" as held in N.R. Dongre (supra), Milmet Oftho (supra) and Neon Laboratories (supra).
Mr. Bachawat submits that the Hon'ble Supreme Court in Sundeep Kumar Bafna Vs. State of Maharashtra reported at (2014) 16 SCC 623 (Paragraph 19) thereof that in case of conflict between the two decisions of the Bench of same strength the earliest view should be followed: -
"19. It cannot be over-emphasised that the discipline demanded by a precedent or the disqualification or diminution of a decision on the application of the per incuriam rule is of great importance, since without it, certainty of law, consistency of rulings and comity of courts would become a costly casualty. A decision or judgment can be per incuriam any provision in a stature, rule or regulation, which was not brought to the notice of the country. A decision or judgment can also be per incuriam if it is not possible to reconcile its ratio with that of a previously pronounced judgment of a consonance with the views of this court. It must immediately be clarified that the per incuriam rule is strictly and correctly applicable to the ratio decidendi and not to obiter dicta. It is often encountered in High Courts that two or more mutually irreconcilable decisions of the Supreme Court are cited at the Bar. We think that the inviolable recourse is to apply the earliest view as the succeeding ones would fall in the category of per incuriam."
Mr. Bachawat submits that the issue of protection accorded to well-known marks under Section 29(4) Trade Marks Act, 1999 was not in issue in Indchemie Health Specialties Pvt. Ltd. (supra). The marks in the said case were "Cherry" and "Multi Cherry" and not any distinctive trademark.
The learned counsel submits that in Vishnu Das Trading (supra) the Hon'ble Supreme Court clarified that the controversy in the appeal was confined only to the propriety of an order passed in rectification proceedings and the questions regarding infringement and passing off were not necessary to be addressed in that case.
It is also submitted that in Kamdhenu Ispat (supra), "Kamdhenu" was found to be a common word, signifying plenty, perpetual supply and prosperity and as such "Kamdhenu" not being a distinctive mark, no protection was granted. The said judgment is contrary to Volvo (supra), Montari (supra), Sony Kabushiki Kaisha (supra) and has no application in the facts and circumstances of the present case.
Section 2 (1) (r) defined "permitted use". Section 2 (1) (r) (ii) (which was not there in the old 1958 act but introduced in Trade Marks Act, 1999) permits use of a registered trademark by a person other than a registered proprietor and registered user in course of trade by consent of the registered proprietor.
Mr. Bachawat submits that Section 48 (2) further clarifies permitted use of a trademark shall be deemed to be used by a person other than the proprietor for any other purpose for which such use is material under the act or other law for the time being in force. Hence the point raised by the respondent that Petitioner No.1 cannot get benefit of the use of the mark by its unregistered licensee is misconceived and has no basis.
Mr. Bachawat submits that a group company of Petitioner No.1, Exxon Chemical Eastern Inc. had set up its office in India on 01.01.1980. The word "Exxon" has been registered in India in relation to industrial oil, gases, lubricants on 28.10.1967. The petitioner has been selling Butyl under the Mark "Exxon" in India from 30.11.1982 to CEAT, Apollo, Dunlop, JK Industries, Vikrant and Bombay Tyres International.
On the other hand, the defendant is claiming to use the mark "Exon" in India as a trading name only from 06.10.1989 i.e. First trade license issued from Dum Dum municipality in 1989. The said trade licence has not been renewed after 13.04.2005. The defendant has merely produced test reports issued by him Ministry of Industries on 20.01.1986 and a letter issued by National Jute Industries dated 27.02.1985. The respondent has obtained ISO Registration only on 24.12.2004 which had expired on 23.12.17. The respondent has neither furnished any invoice or bills or sales figures or profits earned by him showing sale of any product under the Mark "Exon" nor has the defendant attached any documents to show that any goods have been sold by him under the mark "Exon". No sales figures or advertisement expenses have been produced by the respondent in the affidavit and in absence thereof it cannot be contended that he is the prior user of the mark "Exon" in India.
The petitioner has registration of fire-fighting component. The respondent has no registration of the mark "Exon". The application filed by Defendant for registration of the mark Exon has been abandoned. There is no document to show that the respondent was established in 1982 as claimed. The mark "Exxon" is registered in favour of the petitioner no. 1 in relation to fire-fighting components which has remained in the register as on this date. Hence use of the mark "Exon" also constitutes infringement under Section 29 (2) Trade Marks Act, 1999, which is in addition to the protection to be granted to the petitioner under Section 29 (4) read with section 29 (5) of the Trade Marks Act, 1999 as the mark "Exxon" is a well-known and distinctive trademark. Mr. Bachawat, accordingly, has submitted that the defendant should be restrained from infringing the well-known mark "Exxon" in any manner whatsoever.
The bone of contention is the use of the mark "Exon" by the defendant as its trading name as also in relation to its goods, namely, fire extinguishers. The mark "Exon" is an unregistered mark. The merits of the rival claims need to be assessed on the basis of the pleadings and submissions noted above.
Section 2(m) of the Act gives an inclusive definition of 'mark'. 'Mark' includes amongst others 'name'. Under Section 29 a registered trade mark is infringed, if -
(a) the mark is identical and is used in respect of similar goods or services; or
(b) the mark is similar to the registered trade mark and there is an identical or similarity of the goods or services covered by the trade mark; or
(c) the trade mark is identical and is used in relation to identical goods or services;
and that such use is likely to cause confusion on the part of the public or is likely to be taken to have an association with the registered trade mark.
This clause further lays down that in cases falling in category (c) above, there will be a legal presumption of likelihood of confusion on the part of the public.
The ingredients of Section 29(1) are as follows:-
1. The plaintiff's mark is registered.
2. The defendant's mark is identical with, or deceptively similar to the plaintiff's registered mark.
3. The defendant's use of the mark is in the course of trade in respect of goods/services covered by the registered trade mark.
4. The use by the defendant is in such manner as to render the use of the mark likely to be taken as being use as a trade mark.
5. The defendant's use of the mark is not by way of "permitted user" and accordingly unauthorized infringing use.
Section 2(h) defines "deceptively similar". It states that a mark shall be deemed to be deceptively similar to another mark if it so nearly resembles that the other mark as to be likely to deceive or cause confusion.
The function of a trade mark is to distinguish the goods of one person from others.
As was said by UPJOHN, J., "A man infringes the mark of another if he seizes upon some essential feature of the plaintiff's mark. That essential feature may be ascertained by the eye or by the ear in this sense, that goods bearing that mark may be likely to become known by a certain name......Furthermore evidence is admissible to establish what is or has become an essential feature, but evidence is not essential if the Court feels satisfied on inspection in coming to the conclusion that some particular feature is a distinguishing feature of the Mark allegedly infringed". (Cluett Peabody & Co. Inc. Vs. McIntyre Hogg Marsh & Co. Ld.; 1958 RPC at 351) The action of the petitioner is based on an infringement of trade mark as also passing off. Where respondent's mark is identical with the petitioner's mark, the question is simple. The petitioner, in such a situation, would not be required to prove his use of the registered trade mark, but merely has to establish that the respondent is using a trade mark which is identical to the petitioner's mark and in respect of goods which are covered by the petitioner's registration. The petitioner, in such a situation, need not prove that the respondent's use is likely to deceive or cause confusion. The Act with precision has put the owner of the registered trade mark in an exalted position, whether he has used the mark or not, a registered owner would be entitled to the exclusive use of it unless someone shows a continuous user from a date anterior to the registered proprietor's use or registration, whichever is earlier.
The respondent also cannot take advantage of prior user as available to them under Section 34 of the Act as the respondent is unable to produce any evidence at this stage to show any user prior to 1982 as the word mark 'Exxon" was registered in 1967. The few documents disclosed in the affidavit does not show use of the mark "Exon" prior to 1982 or 1988. The defendant although had the opportunity to disclose invoice, bills, sales figures or profits earned by sale of any product under the mark "Exon" but did not disclose any such document to substantiate its claim of prior user. Although, the website of the respondent shows pictures of fire extinguishers with the mark "Exon" affixed on such equipments, the respondent did not disclose any document, invoice, bill(s), etc., to show that the respondent, in fact, is manufacturing and/or selling fire extinguishing equipments under the mark "Exon". In this regard the observation of the Division Bench of the Madras High Court in Amaravathi Enterprises vs. Karaikudi Chettinadu reported at 2008 (36) PTC 688 (Mad.) (paragraph 21) is apposite where Their Lordships have held that when a defence of prior user is taken, burden lies on such trader/ manufacturer to prove the continuous use of the said trade name and in that regard the volume of sales also assumes significance.
The registration of the word mark itself is a prima facie evidence of the validity of such registration inasmuch as the registration of the mark gives the owner of the mark a valuable and indefeasible right to use it exclusively and jealously protect such mark as opposed to an action based on passing off which solely rests on the concept of prior user.
The judgment of a Single Bench of the Delhi High Court in Walter Bushnell Pvt. Ltd. & Ors. Vs. Miracle Life Sciences & Anr. reported at 2014 (59) PTC 339 (Del) lays down that when the defendant has not challenged the registered trade mark of the plaintiff and there is no materials on record to show that it is a generic name, the Court must recognize that a registered trade mark holder is enjoying an exclusive and statutory right which should be adequately protected. In the instant case, no application has been filed by the defendant before the Registrar for cancellation of the trade mark adopted by the plaintiff. It was held in Walter (supra) that unless the trade mark challenged by the defendant is cancelled or ratified it is not the practice to infringe the same in an action for infringement of the trade mark.
The learned single Judge in Walter (supra) has quoted with approval the views expressed in Express Bottlers Services Vs. Pepsico Inc. And Ors. reported at 1989 (9) PTC 14 that to establish the plea of common use, the use by the other persons should be shown to be substantial. The mere use of the name is irrelevant because a registered proprietor is not expected to act on filing suits or proceedings against infringers who are of no consequence.
In Gold Star Co. Ltd. v. Gold Star Industries & Ors. reported at 1995 PTR 78 it was held that "what would happen to the rectification proceedings nobody can predict. As of today prima facie evidence establishes petitioners' exclusive rights regarding the trade mark...Plaintiff cannot be deprived the fruit of registered trade mark nor can the defendant be allowed to use the trade mark of the plaintiff for passing off its goods...If the defendants are allowed to use the trade mark of the plaintiff it would adversely affect the business of the plaintiff, internationally as well as in India".
Similar was the view expressed by the Delhi High Court in the case of Avis International Ltd. v. Avi Footwear Industries reported at AIR 1991 Del. 22.
In Panghat Sarees Pvt. Ltd. versus "Panghat" & Ors., G.A. No.3120 of 2015, G.A. No.3120 of 2014, C.S. No.358 of 2014 dated 14th October, 2015 it was observed that if the defence of prior use is taken it is incumbent upon the defendants at the interlocutory stage to show that there has been an extensive and continuous use of the said mark prior to the registration of the mark of the plaintiff.
The respondent has failed to discharge this onus.
The petitioners have placed reliance on Sections 29(2) and 29(4) of the Trade Marks Act which reads:-
"29.(2) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which because of -
(a) its identity with the registered trade mark and the similarity of the goods or services covered by such registered trade mark; or
(b) its similarity to the registered trade mark and the identity or similarity of the goods or services covered by such registered trade mark; or
(c) its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark.
(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which -
(a) is identical with or similar to the registered trade mark; and
(b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and
(c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark."
In an action based on Section 29(4), infringement would arise even by usage of a trade mark in relation to dissimilar goods if following three conditions are satisfied:-
"(a) Mark is identical with or similar to the registered trade mark;
and
(b) Mark is used in relation to goods or services which are not similar to those for which the trade mark is registered; and
(c) The registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to the distinctive character or repute of the registered trade mark."
The said section jealously protects a reputed mark. The Trade Marks Law does not permit and protect a person who is trying to take the benefit of someone else's reputation with references to goods which may not be similar when it is established that the said mark has acquired some reputation.
Even if the petitioners may not succeed in establishing its right under Section 29(4) of the Trade Marks Act, 1999, the petitioners certainly have been able to establish that using the infringed mark is likely to cause confusion in the mind of the public that the products sold is as of the plaintiff. The common law remedy of passing off has been retained in Section 27 of the Trade Marks Act, 1999.
Passing off is an actionable wrong for a trader so to conduct his business as to lead to the belief that his goods, services or business are the goods, services or business of the claimant. In an action for passing off, the claimant must establish goodwill attached to the goods or services which he supplies. The claimant is also required to demonstrate a material misrepresentation by the defendant to the public (whether or not intentional) leading to or likely to lead to the public believing that the goods or services were offered by him are the goods or services of the claimant. The claimant also must demonstrate that he suffers and is likely to suffer damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant's goods or services is the same as the source of those offered by the claimant. (See Clerk and Lindsell on Torts) The basis of the action in passing off is the classical trinity of:
(1) a reputation (or goodwill) acquired by the [claimant] in his goods, name, mark etc. (2) a misrepresentation by the defendant leading to confusion (or deception) causing (3) damage to the [claimant]." (per Nourse L.J. in Consorzio del Prosciutto di Parma v. Marks & Spencer Plc [1991] R.P.C.351) In Erven Warnink BV v. J Townend & Sons (Hull) Ltd ("Advocaat"), [1979] A.C.731, Lord Diplock set out the essential five requirements of the tort as follows:
(1) a misrepresentation
(2) made by a trader in the course of trade,
(3) to prospective customers of his or ultimate consumers of goods or services supplied by him, (4) which is calculated to injure the business or goodwill of another trader (in the sense that this is a reasonably foreseeable consequence) and (5) which causes actual damage to the business or goodwill of the trader by whom the action is brought.
A passing off action protects a proprietary interest in goodwill. "It is a remedy for the invasion of a right of property and not in the mark, name or get up improperly used but in the business or goodwill likely to be injured by the misrepresentation....", per Lord Diplock in Star Industrial Co. Ltd. v. Yap Kwee Kor [1976] F.S.R. 256 and see Sir John Mummery in Starbucks (HK) Ltd. v. British Sky Broadcasting Group Plc [2013] EWCA Civ 1465; [2014] F.S.R. 20 at [102].
Lord Macnaghten in IRC v. Muller [1901] A.C. 217 has defined goodwill as "the benefit and advantage of the good name, reputation and connection of a business".
A claimant generates goodwill by the use of a distinctive name, mark, description or get up in relation to his goods, services or business.
The Court will interfere to prevent the use of deceptive business names as it would prevent the use of deceptive trade marks. (Office Cleaning Services Ltd. v. Westminster, etc. Cleaners Ltd. (1946) 63 R.P.C. 39 at 42) Even if the defendants might have adopted the name (trade name) innocently, if there is probability of confusion in the business, an injunction will be granted against such use is a view which finds support in Laxmikant V. Patel vs. Chetanbhat Shah reported at AIR 2002 SC 275. In this case the plaintiff was operating under the name and style 'Muktajivan Studio'. The defendant who was earlier using the name 'Gokul Studio' later changed the name to 'Muktajivan Studio'. Intention of the defendant to make use of business name of the plaintiff so as to divert the business to himself was apparent and the injunction was therefore, granted. The Court said:-
"The name of a business normally has attached to its goodwill, independent of the question of trade or service mark, and the courts will protect that goodwill. An action for passing off lies wherever the defendant company's name, or its intended name is calculated to deceive, so as to divert business from the plaintiff or to occasion a confusion between two businesses. The ground is not to be limited to the date of the proceedings and the court will take into account the way in which business may be carried on in the future or in other words the possibility of diversion of business in future. The principal issue for decision would be whether the business of plaintiff run in a trade name also had come into existence prior to commencement of its user by the defendants and whether the trade name of plaintiff had acquired a goodwill creating a property in the plaintiff so as to restraint the use of similar word in the business name of a similar trade by the defendant - a competitor."
In Paragraphs 10, 12 and 13 the law on this issue was summarized. The said Paragraphs read:-
"10. A person may sell his goods or deliver his services such as in case of a profession under a trading name or style. With the lapse of time such business or services associated with a person acquire a reputation or goodwill which becomes a property which is protected by courts. A competitor initiating sale of goods or services in the same name or by imitating that name results in injury to the business of one who has the property in that name.
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 the 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 policy in the world of business. Secondly, when a person accepts or intends to adopt a name in connection with his business or services which already belongs to someone else, it results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury."
"12. In Oertil vs. Bowman (1957) RPC 388 (at page 397), the gist of passing-off action was defined by stating that it was essential for the success of any claim to passing-off based on the use of given mark or get-up has become by user in the country distinctive of the plaintiff's goods, so that the use in relation to any goods of the kind dealt in by the plaintiff on that mark or get-up will be understood by the trade and the public in the country as meaning that the goods are the plaintiff's good. It is in the nature of acquisition of a quasi-proprietary right to the exclusive use of the mark or get-up in relation to goods of that kind because of the plaintiff having used or made it known that using the same or somewhat deceptively similar mark, get-up or name in relation to goods not of plaintiff. The three elements of "passing-off" action are the reputation of goods, possibility of deception and likelihood of damages to the plaintiff. In our opinion, the same principle, which applies to trade mark, is applicable to trade name.
13. In an action for passing off it is usual, rather essential, to seek an injunction temporary or ad-interim. The principles for the grant of such injunction are the same as in the case of any other action against injury complained of. The plaintiff must prove a prima facie case, availability of balance of convenience in his favour and his suffering an irreparable injury in the absence of grant of injunction. According to Kerly (Ibid, para 16.16) passing off cases are often cases of deliberate and intentional misrepresentation, but it is well-settled that fraud is not a necessary element of the right of action, and the absence of an intention to deceive is not a defence though proof of fraudulent intention may materially assist a plaintiff in establishing probability of deception. Christopher Wadlow in Law of Passing Off (1995 Edition, at p. 3.06) states that the plaintiff does not have to prove actual damage in order to succeed in an action for passing off. Likelihood of damage is sufficient. The same learned author states that the defendant's state of mind is wholly irrelevant to the existence of the cause of action for passing off (ibid, paras 4.20 and 7.15). As to how the injunctions granted by the Court would shape depends on the facts and circumstances of each case. Where a defendant has imitated or adopted that plaintiff's distinctive trade mark or business name, the order may be an absolute injunction that he would not use or carry on business under that name. (Kerly, ibid, para 16.97)" (emphasis supplied) In another decision of the Supreme Court in the case of Ramdev Food Products Ltd. vs. Arvindhbhai Rambhai Patel & Ors., reported at 2006 (8) SCC 726, the Supreme Court has observed that the test for determining deceptive similarity in an infringement action would be the same as in the case of a passing off action. The Court observed that although the defendants might not be using the actual trademark of the plaintiff, the get up of the defendant's goods may be so much like the plaintiff's that a clear case of passing off could be proved. It was held:-
"The law does not permit any only to carry on his business in such a way as would persuade the customers or clients in believing that the 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 results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury."
The collective provisions of Sections 27, 28, 29 and 34 of the Trade Marks Act, 1999 was considered in a resent judgment of Hon'ble Supreme Court in S. Syed Mohideen (supra), in the said decision it was held that the passing off right are superior to the rights conferred by registration. In this regard reference may be made to paragraphs 31.1 to 32.2 of the said report which reads:
"31.1. Traditionally, passing off in common law is considered to be a right for protection of goodwill in the business against misrepresentation caused in the course of trade and for prevention of resultant damage on account of the said misrepresentation. The three ingredients of passing off are goodwill, misrepresentation and damage. These ingredients are considered to be classical trinity under the law of passing off as per the speech of Lord Oliver laid down in Reckitt & Colman Products Ltd. vs. Borden Inc., (1990) 1 WLR 491: (1990) 1 All ER 873 (HL) Which is more popularly known as 'Jif Lemon' case wherein Lord Oliver reduced the five guidelines laid out by Lord Diplock in Erven Warnink Besloten Vennootschap v. J. Townend & Sons (Hull) Ltd., 1979 AC 731 at p. 742: (1979) 3 WLR 68: (1979) 2 All ER 927 (HL) to three elements (1) goodwill owned by a trader (2) misrepresentation, and (3) damage to goodwill. Thus the passing off action is essentially an action in deceit where the common law rule is that no person is entitled to carry on his or her business on pretext that the said business is of that of another. This Court has given its imprimatur to the above principle in Laxmikant V. Patel vs. Chetanbhai Shah, (2002) 3 SCC 65.
31.2. The applicability of the said principle can be seen as to which proprietor has generated the goodwill by way of use of the mark/name in the business. The use of the mark/carrying on business under the name confers the rights in favour of the person and generates goodwill in the market. Accordingly, the latter user of the mark/name or in the business cannot misrepresent his business as that of business of the prior right holder. That is the reason why essentially the prior user is considered to be superior than that of any other rights. Consequently the examination of rights in common law which are bases on goodwill, misrepresentation and damage are independent to that of registered rights. The mere fact that both prior user and subsequent user are registered proprietors are irrelevant for the purposes of examining who generated the goodwill first in the market and whether the latter user is causing misrepresentation in the course of trade and damaging the goodwill and reputation of the prior right holder/former user. That is the additional reasoning that the statutory rights must pave the way for common law rights of passing off.
32. Thirdly, it is also recognised principle in common law jurisdiction that passing off right is broader remedy than that of infringement. This is due to the reason that the passing off doctrine operates on the general principle that no person is entitled to represent his or her business as business of other person. The said action in deceit is maintainable for diverse reasons other than that of registered rights which are allocated rights under the Act. The authorities of other common law jurisdictions like England more specifically Kerly's Law of Trade Marks and Trade Names, 14th Edition Thomson, Sweet & Maxwell South Asian Edition recognises the principle that where trade mark action fails, passing off action may still succeed on the same evidence. This has been explained by the learned author by observing the following:
"15-033. A claimant may fail to make out a case of infringement of a trade mark for various reasons and may yet show that by imitating the mark claimed as a trade mark, or otherwise, the defendant has done what is calculated to pass off his goods as those of the claimant. A claim in passing off has generally been added as a second string to actions for infringement, and has on occasion succeeded where the claim for infringement has failed."
32.1. The same author also recognises the principle that the Trade Marks Act affords no bar to the passing off action. This has been explained by the learned author as under:
"15.034. Subject to possibly one qualification, nothing in the Trade Marks Act, 1994 affects a trader's right against another in an action for passing off. It is, therefore, no bar to an action for passing off that the trade name, get up or any other of the badges identified with the claimant's business, which are alleged to have been copies or imitated by the defendant, might have been, but are not registered as, trade marks, even though the evidence is wholly addressed to what may be a mark capable of registration. Again, it is no defence to passing off that the defendant's mark is registered. The act offers advantages to those who register their trade marks, but imposes no penalty upon those who do not. It is equally no bar to an action for passing off that the false representation relied upon is an imitation of a trade mark that is incapable of registration. A passing off action can even lie against a registered proprietor of the mark sued upon. The fact that a claimant is using a mark registered by another party (or even the defendant) does not of itself present goodwill being generated by the use of the mark, or prevent such a claimant form relying on such goodwill in an action against the registered proprietor. Such unregistered marks are frequently referred to as "common law trade marks".
32.2. From the reading of the aforementioned excerpts from Kerly's Law of Trade Marks and Trade Names, it can be said that not merely it is recognised in India but in other jurisdictions also including England/U.K (provisions of the UK Trade Marks Act, 1994 are analogous to the Indian Trade Marks Act, 1999) that the registration is no defence to a passing off action and nor the Trade Marks Act, 1999 affords any bar to a passing off action. In such an event, the rights conferred by the Act under the provisions of Section 28 have to be subject to the provisions of Section 27(2) of the Act and thus the passing off action has to be considered independent "Iruttukadai Halwa" under the provisions of the Trade Marks Act, 1999."
In Law Society of England and Wales v. Griffiths reported at [1995] R.P.C. 16 it was held:
"(a) person who takes steps which will lead a person who acts in a particular way to conclude that his business is that of another is guilty of passing off just as much as a person who states that his business is that of another."
The name under which a business trades will almost always be a trade mark (or if the business provides services, a service mark or both). Independently of questions of trade or service mark, however, the name of a business (a trading business or any other) will normally have attached to it a goodwill that the courts will protect. An action for passing off will then lie wherever the defendant company's name, or its intended name, is calculated to deceive, and so to divert business from the claimant, or to occasion a confusion between the two businesses. If this is not made out there is no case. The ground is not to be limited to the date of the proceedings; the court will have regard to the way in which the business may be carried on in the future, and to its not being carried on precisely as carried on at the date of the proceedings. Where there is a probability of confusion in business, an injunction will be granted even though the defendants adopted the name innocently and even though the claimant has decided no longer to use the name.
Once the claimant has proved the elements necessary for passing off, and in particular deception of the public or its likelihood, the concept that the defendant escapes liability because he is making "bona fide" use of his own name, is a difficult one.
The precise nature and extent of this "defence" are none too clear, the rather numerous authorities on the point being difficult to reconcile. The defence is certainly of very limited scope. Jacob L.J. has made his scepticism as to the practical effect of the defence clear.
"The Judge rightly observed that the passing off defence is narrow. Actually no case comes to mind in which it has succeeded. Because the test is honesty, I do not see how any man who is in fact causing deception and knows that to be so can possibly have a defence to passing off."
If the honest use of one's own name is truly a defence to a passing off claim, then it must apply even if all other elements of the tort are made out by the claimant. This is understandably unattractive to the courts: if the use of by a defendant of a mark constitutes a misrepresentation leading to deception and damage (as it must be if passing off is to be established) the mere fact that through an accident of birth the mark used is the defendants own name would save the defendant from passing off. In modern trading conditions, any individual (or company) can adjust their trading style, if they so wish, so as to eliminate deception on the part of the public. In such circumstances, it is difficult to see the justification for upholding any absolute right to trade under one's own name when balanced against the deception.
The origins of the "defence" lie in certain dicta of Romer J. certainly the defence does not extent to allowing use of the trader's own name in relation to goods so as to pass off:
"To the proposition of law that no man is entitled so to describe his goods as to represent that the goods are the goods of another, there is no exception" [See: Kerly's Law of Trade Marks and Trade Names, 15th Edition] This view was approved in Parker-Knoll v. Knoll International (1962) R.P.C. 265, at 279.
Likelihood of confusion as to source or origin of a particular good sold under a particular trade mark broadly amounts to an act of passing off.
It is significant to note that by the time the respondent decided to start its business under the trading name "Exon Engineering Corporation", the trade mark "Exxon" was a shining star in the horizon and already having significant presence in the world market. It also had a significant presence in India. It had world-wide reputation and goodwill including in India.
The very fact that the respondent has applied for registration of the mark "Exon" in 1989 as "proposed to be used" shows that the respondent never treated and/considered the word "Exon" as something which is common, ordinary and not registrable. An attempt has been made by the learned Counsel representing the respondent that the word "Exon" is a common dictionary word and hence not registrable. Further, no application for rectification or cancellation of the mark "Exxon" has been initiated. A word not so commonly used or known but found in the dictionary still can acquire distinctiveness through secondary meaning if such word is exclusively, uninterruptedly and extensively used by the claimant. In such a situation it becomes associated with the claimant and acquires distinctiveness. The dictionary meaning of the word "Exon" is "in bio-chemistry: a segment of a DNA or RNA molecule containing information coding for a protein or peptide sequence" (Oxford English Dictionary, Tenth Ed. Revised). It is not one of such words which one would ordinarily look for in the dictionary or commonly used. It is not a common word. It has no connection with any fire extinguisher or a fire extinguishing composition. The word "Exxon" does not describe the character or quality of the goods. The said mark is distinctive per se. If a word is invented, it must, for practical purpose, be considered as original as stated by Justice Graham in Exxon Corporation & Ors. (supra).
In Exxon Corporation & Ors. (supra), although the copyright claim of the Exon Engineering Corporation had failed on the ground that it may not be an original literary work within the meaning of Section 2(1) of the 1956 Act but it was held that the petitioners are entitled to an injunction and ancillary relief restraining passing off by the defendant by its continued use of the word "Exxon" and they are also entitled to an injunction against the defendant restraining it from allowing its name in a form incorporating the word "Exon" to remain on the company's register, because it would be unlawful and damaging to the petitioners to allow the name to remain on the register. The plea of absence of common field activity was also considered and rejected. Justice Graham has clearly stated that the plea of passing off can succeed even if the plaintiff may not succeed in infringement. The two claims can be made in a plaint. In the words of Justice Graham, "it will be seen from the statement of claim that the petitioners make two claims for relief and say that they have two independent rights of action against the defendants. The first is passing off, and as to this the statement of claim alleges, inter alia, that the use by the defendants of Exxon is bound to lead to passing off and in particular to suggest that the defendant company has some connection with, or is a subsidiary of, the petitioners and in particular the parent corporation. This I think must be so; and I have already indicated in argument, and I now confirm, that the petitioners are, in my judgment, entitled to an injunction and ancillary relief to restrain such passing off by continued use by the defendants of the word Exxon". This observation has been relied upon by the Delhi High Court in Khosla (supra) in Paragraph 15.
Like the English case, here also the defendant has no connection with the petitioners or any of them but nonetheless the defendant has adopted the petitioners' name "Exon" as part of trading name. The mere omission of the alphabet 'X' by the defendant cannot absolve the defendant of his liability to explain the adoption of the said mark.
The Full Bench decision of our Court in Sony Kabushiki Kaisha (supra) has also recognized the principle that if a highly distinctive trade mark is applied to a class of goods which is a proprietor does not deal with consumers may always wonder as to whether the proprietor of the trade mark has launched a new product. This is a matter of confusion and deception. Although, the confusion may not always lead to deception. However, in the instant case, having regard to the adoption of the word "Exon" in relation to its trading name and an attempt to associate the said name with fire extinguisher in respect whereof the petitioners have a registration in its favour prior to a claim made by the defendant of its user, the plaintiff for the purpose of this interlocutory application is entitled to an order of injunction as the customers in the trade would likely to associate the said mark with that of the petitioners. The said principle has been recognized in Mahendra & Mahendra Paper Mills Ltd. (supra), Montari Overseas (supra), Dunlop Pneumatic Tyre Co. Ltd. Vs. The Dunlop Lubricant Co. reported at 1899 (XVI) RPC 12 and Volvo Sweden (supra). The goodwill and reputation of the petitioners have been established. The Defendant has offered no explanation for adoption of the distinctive trade mark of the plaintiff. The principle that first in the world market should prevail, in my mind, has to be understood in the context in which it is applied. Mr. Roychowdhury laid great emphasis on the Toyota case (supra) to show that territoriality principle shall apply to defeat the claim of the petitioners as the petitioners have never used the mark "Exon" in relation to fire extinguishers. But the Toyota case (supra) cannot benefit the defendant for the simple reason that in Toyota (supra) there was a prior registration of the mark 'Prius' before any attempt was made by Toyota to have its mark registered in India. The claim succeeded on prior user and the goodwill that the 'Prius' had earned over a period of time for all types of auto parts and accessories which had been using the trade mark 'Prius' much before any attempt was made by Toyota to introduce the said mark in the Indian market. Unlike the respondent herein, the defendants in the Toyota case had obtained registration for the mark 'Prius' in India in 2002 and have been using the same since 2001. Toyota had no registration in India over the mark 'Prius' until it formally launched in India in the year 2010. The defendant therein was regularly supplying auto accessories to various automobile giants like Hyundai Motors, General Motors. The defendants claimed that, over a period of time, they had built up a considerable market reputation. The mark 'Prius' had not been registered in favour of Toyota for any of its products nor had any 'Prius' sold in India so as to enable the plaintiff to claim goodwill in respect of such cars in the Indian market. In the present case, the petitioner has obtained registration of the word mark "Exxon" in India way back in 1967. It is interesting to note that although Toyota had failed to obtain any order of injunction in relation to the mark 'Prius' but the order passed by the Division Bench restraining 'Prius' from using the petitioners' registered trade mark "Toyota" and "Innova" except for the purpose of identifying that the defendant's products can use in these cars have not been disturbed by the Hon'ble Supreme Court. Moreover, in N.R. Dongre v. Whirlpool Corporation reported at 1996 PTC (16) 583, Supreme Court has taken the view that even advertisement of trade mark without existence of goods in the market is to be considered as use of the trade mark. In Jolen Inc. v. Doctor & Company reported at 2002 (25) PTC 29 similar view is expressed. It is stated:-
"It is not necessary that the association of the plaintiff's mark with his goods should be known in the countries other than its origin or to every person in the area where it is known best. Mere advertisement in other countries is sufficient if the trademark has established its reputation and goodwill in the country of its origin and countries where it is registered.
In modern world, advertisements, in the newspapers travel beyond the country where party is engaged in business through overseas editions or otherwise. Even if it is assumed that such advertisements or mark do not travel beyond the borders of the countries where the plaintiff has the business still it has a right to protect its reputation and goodwill. It is more so where the trade name has been pirated in totality and not by way of having deceptive or confusing similarity. We are living in a world where there is enormous mobility. Well travelled Indians and tourists cannot remain unaware of international commodities. Reputation always travels faster than men. Whenever persons travelling abroad for business or pleasure or any other purpose viz. study or temporary postings come across an article of a tradename of international reputation they are bound to be confused as to the source and quality if they happen to see that commodity in their country where there is no physical market. Mere likelihood of confusion is sufficient."
The respondent herein has not been able to show that it has acquired any goodwill or reputation in the local jurisdiction for its mark "Exon". Moreover, the respondent cannot be said to be a bona fide domestic trader who found himself open to litigation at the suit of unknown or barely-known claimants. The presence of the petitioners in the Indian market much prior to the tall claim of the respondent of prior use is established. Although much emphasis is given to the class of products to justify the use of the word "Exon" as a trading name, it is enough if the same name is adopted without any justification. It is irrespective of the nature of the product as it is likely to cause confusion and proof of intention to deceive is not essential. Mere likelihood of confusion is sufficient. It is apparent that the words "Exxon" and "Exon" are phonetically and visually same and/or deceptively similar. In this regard, reliance may be placed on C & A Modes v. C & A (Waterford) Ltd. reported at 1976 IR 198 (Irish) where the plaintiffs operated a chain of clothes stores throughout the UK and even in Northern Ireland but not in the Republic of Ireland where the defendants were trading.
The Irish Supreme Court while affirming the decision of the Division Bench has stated:-
"In a given situation, there may be no complaints made to the claimant that goods marketed by the defendants under the impugned mark had been inadvertently purchased as that of the plaintiff claimant. The onus of bringing such proof, as an invariable requirement, would be to cast on the claimant an onerous burden which not be justified. Commercial and business morality which is the foundation of the law of passing-off should not be allowed to be defeated by imposing such a requirement. In such a situation, likelihood of confusion would be a surer and better test of proving an action of passing-off by the defendants. Such a test would also be consistent with commercial and business morality which the law of passing-off seeks to achieve. In the last resort, therefore, it is preponderance of probabilities that must be left to judge the claim."
On such considerations, in my view, the decision of Toyota (supra) does not come to the aid of the defendant.
In Vishnudas Trading (supra), the controversy in the appeal arose out of the order of rectification of registration of the trade mark in favour of Vazir Sultan Tobacco Co. Ltd., and, accordingly, the Supreme Court did not address on the questions of infringement of trade marks, passing off, defensive registration etc. This is clear from the observations made in Paragraph 50 of the said decision. The relevant observations are:-
"50. It has already been indicated that the controversy in the instant appeals, is only confined to the propriety and validity of the order of rectification of the registration of trade mark made in favour of Respondent Company and it is not necessary to address on the questions of infringement of trade marks, passing off, defensive registration etc. In that view of the matter, various decisions cited at the bar dealing with the likely prejudice to be suffered by a trader or manufacturer enjoying registration of trade mark in the event, similar or deceptively similar trade mark is allowed to other trader or manufacturer in respect of similar goods or goods marketed through common trade channel need not be taken into consideration for the disposal of these appeals. As in the facts and circumstances of the case, the rectification of the trade marks registered in favour of the respondent Company since allowed by the Assistant Registrar of Trade Marks was valid and also justified, such order in our view, should not have been interfered with in appeal.
The protection extended by Section 29(4) even to dissimilar goods and services, is actually based upon the 'doctrine of dilution'. Dilution is a type of violation of a trade mark, in which the defendant's use, while not causing a likelihood of confusion, blurs distinctiveness or tarnishes the image of the plaintiff's mark. (Ashok Leyland Limited v.
Blue Hill Logistics Pvt. Ltd. 2011 (46) PTC 535 (Mad) at p. 544.) In Catterpillar Inc. V. Mehtab Ahmed and Others, 2002 (25) PTC 438 (Del), the Delhi High Court has held:-
"Another important aspect for protecting trademarks is to avoid weakening or dilution of the trade marks. If the subsequent user adopts the similar or near similar mark in respect of same goods it would not only decrease the value of the trade mark of a prior user but ultimately may result in dilution of the mark itself. Such an invasion of the subsequent user is nothing short of commercial invasion. Trade mark is like a property and no unauthorised person is allowed to commit trespass. Such kind of dilution or weakening of the trade mark need not, therefore, be accompanied with an element of confusion.
So far as doctrine of dilution is concerned it is an independent and distinct doctrine. The underlying object of this doctrine is that there is presumption that the relevant customers start associating the mark or trade mark with a new and different source. It results in smearing or partially affecting the descriptive link between the mark of the prior user and its goods. In other words the link between the mark and the goods is blurred. It amounts to not only reducing the force or value of the trade mark but also it gradually tapers the commercial value of the marks slice by slice. Such kind of dilution is not a fair practice that is expected in trade and commerce."
In Tata Sons Ltd. V. Manoj Dodia reported at 2011 (46) PTC 244 (Del) it is stated:
"6. The doctrine of dilution, which has recently gained momentus, particularly in respect of well known trademarks emphasises that use of a well known mark even in respect of goods or services, which are not similar to those provided by the trademark owner, though it may not cause confusion amongst the consumer as to the source of goods or services, may cause damage to the reputation which the well known trademark enjoys by reducing or diluting the trademark's power to indicate the source of goods or services.
7. Another reason for growing acceptance of trans-border reputation is that a person using a well known trademark even in respect of goods or services which are not similar tries to take unfair advantage of the trans-border reputation which that brand enjoys in the market and thereby tries to exploit and capitalize on the attraction and reputation which it enjoys amongst the consumers. When a person uses another person's well known trade, he tries to take advantage of the goodwill that well known trade enjoys and such an act constitutes an unfair competition."
The word, "Exxon" is a coined/invented word and was adopted and first used by the petitioner No.1 in U.S.A on October 6, 1967. In India, the earliest registration of the trademark "Exxon" dates back to October 28, 1967. Bennett H. Wall in his book "Growth in a Changing Environment - A History of Standard Oil Company (New Jersey), Exxon Corporation, 1950-1975", (McGraw-Hill Book Company, ISBN - 0-07-067915-0) in Chapter 22 has discussed in detail the tedious study and lengthy and labored brainstorming session of the committees of Standard oil and affiliates with its outside consultants before finally adopting the "Exxon" as its new trademark. The Esso, Enco and Humble trademarks under which the affiliate of Standard oil were operating at various parts of USA, beginning July 1, 1972 have started to be replaced as the primary marketing identification by a single name Exxon- a completely new word. Subsequently all the affiliates in order to take full advantage and benefit of the new trade mark started changing their corporate name like Exxon, Exxon Corporation Etc. Standard oil Company (New Jersey) become Exxon Companies in 1972.
Exxon Corporation later on merged with Mobil Corporation and its affiliates on 30th November, 1999 and that is how the petitioner No.1 was born. It is significant to mention that even if at the time when the company was in the process of restructuring and working tediously towards finally selecting its trade mark which later on become its business name, on 28th October, 1967 Standard Oil Company applied for registration of word mark "EXXON" and such registration was granted on 5th February, 1972.
The petitioner has disclosed numerous orders and judgments passed by different Courts in India recognizing "Exxon" as a well-known trade mark.
There cannot be any doubt that the adoption of the said mark by the respondent is with a view to create confusion and deception in the market. The respondent has tried to put up a defence of non-user by the petitioners. The respondent has not been able to show that any of its products is sold under the trade mark "Exon". The material on record shows that the respondent is carrying on its trading business under the name and style of "Exon Engineering Corporation". Apart from the fact that the petitioners are prior user of the mark and has also obtained a registration, inter alia, for fire extinguishing composition, the use of the name "Exon" as a trading name by the respondent cannot be justified as it is likely to cause confusion and deception.
In view of the material on record, it appears that the "Exxon" is a well-known trade mark and it comes within the definition of Section 2(1)(zg) of the Trade Marks Act, 1999 and the case of infringement is made out within the meaning of Section 29(4) of the Trade Marks Act, 1999.
The argument with regard to the narrow class of registration is also not accepted as in the instant case the mark "Exxon" is distinctive and is a well-known trade mark within the definition of Section 2(1)(zg) of the Trade Marks Act, 1999. Moreover, the respondent is seeking to take benefit and advantage of the good name and reputation of the business of the petitioners by using a deceptive business name.
The respondent possibly cannot dispute the institution of the suit by the petitioner No.1 for infringement of its trade mark in this jurisdiction. The defendant, however, raised an issue with regard to the action in passing off on the ground that there has been no use of the mark "Exxon" by the petitioner No.1 in India. It is contended that the use of the mark by the petitioner No.2 is that of a permitted user and use of the mark by a permitted user cannot give a cause of action to the petitioner No.1 to institute a suit for infringement or passing off as the case may be. The petitioner No.2 has to be a registered user in which case the petitioner No.1 could take the benefit of use of the said mark for the purpose of any infringement action.
Section 2(r) defines 'permitted use'. It has two parts. Section 2(r)(i) deals with permitted use in relation to a registered trade mark by a registered user whereas Section 2(r)(ii) deals with permitted use by a person other than a registered proprietor or a registered user in relation to goods or services. Section 48 deals with registration of registered users. Sub-section (2) provides that the use of the mark by the registered user ensures to the benefit of the proprietor and not to the user. The expression 'permitted use' has been redefined to explicitly include a common law licence of an unregistered user of a registered trade mark. Sub-section (2) enacts that the permitted use of the trade mark which includes of a registered user as well as an unregistered licensee shall be deemed to be used by the proprietor thereof. It further enacts that such use shall be deemed not to be used by a person other than the proprietor for the purposes of Section 47 (removal on the ground of non-use) or for any other purpose for which such use is material under this Act or any other law. In case of a common law licence as envisaged under Section 2(r)(ii), the licence is used by consent of a registered proprietor in a written agreement.
The essential function of a trade mark is to give to the consumer or ultimate user a guarantee of the identity of the origin of the mark product by enabling him to distinguish, without any possible confusion, that product from others of a different provenance. For a trade mark to function it must offer a guarantee that all the goods bearing it have originated under the control of a single undertaking which is responsible for their quality (see Safari Trade Mark [2002] RPC 497, p. 503). It, therefore, follows use of the trade mark by a common law licensee as above, preserving the essential function of a trade mark shall be deemed to be used by the proprietor in terms of Section 48(2) of the Act.
The distinction between registered user and permitted user in Section 48 has been noticed by Justice Rajiv Sahai Endlaw in Exxon Mobil Corporation & Anr. v. P.K. Sen (I.A. No. 20626/2015 in C.S. No. 2375/2015) dated 22nd July, 2016 in connection with an application for rejection of the plaint on the ground that the averments in the plaint does not disclose that the Delhi High Court has territorial jurisdiction to try the suit. The judgment of the learned Single Judge was reversed in the appeal and the Special Leave Petition against the order of the Division Bench was dismissed by the Hon'ble Supreme Court but the discussion on Section 48 made by Justice Endlaw is still relevant in order to decide the objection of the defendant that the use of the mark "Exxon" by the petitioner No.2 being the permitted user cannot be deemed to be an use by the plaintiff. The relevant observations can be found in Paragraphs 8, 9 and 11 which read:-
"8. Section 48(1) of the Act provides for registration of a person other than the registered proprietor of the trademark as a registered user thereof in respect of any or all of the goods or services in respect of which the trademark is registered. Sub Section (2) thereof provides that the permitted use of a trademark shall be deemed to be used by the proprietor thereof.
9. Section 48 uses the expression "registered user" and "permitted use" in Sub Sections (1) and (2) thereof respectively. Thus the Act envisages permitted use of the trademark without the person to whom such permission has been given being a registered user of the trademark. The distinction becomes further evident from Section 2(1)(r) of the Act which while defining permitted use, in Clause (i) thereof provides for permitted use by a registered user and in Clause (ii) thereof provides for permitted use by a person other than registered proprietor and registered user. Such permitted use can be by a person with whom the registered proprietor or the registered user is connected in the course of trade in respect of which the trademark remains registered and by consent of the registered proprietor contained in a written agreement and which person complies with any conditions or limitations to such use or registration of the mark is subject.
11. Section 52 of the Act entitles a registered user of the trademark to in his name institute proceedings for infringement of the trademark on the condition that the registered proprietor shall be impleaded as defendant to such suit. Section 53 provides that a permitted user within the meaning of Section 2(1)(r)(ii) shall have no right to institute any proceedings for any infringement."
The Division Bench while reversing the said judgment did not say that the use of the trade mark by the petitioner No. 2 is not to be considered as deemed use of the trade mark by the petitioner No.1. The observation of the Division Bench is in relation with Section 134(2) of the said Act. This Court is in agreement with the views expressed by Justice Endlaw with regard to the interpretation of Section 48 and is of the view that the use of the mark "Exxon" by the petitioner No. 2 is a deemed use of the trade mark by the proprietor for the purpose of maintaining a suit for infringement and passing off. In fact, the defendant cannot object to an action for passing off on the basis of the use of the mark "Exxon" by the petitioner No. 2. The Act does not prevent a permitted user to file a suit for passing off.
One of the main objections raised by the defendant is with regard to the verification and special power of attorney. The verification of pleadings of a company is governed by Order 29 Rule 1 of the Code of Civil Procedure. Under Order 29 Rule 1 provides that in a suit by or against a corporation, the Secretary or any Director or other principal officer of the corporation who is able to depose to the facts of the case might sign and verify on behalf of the company. This provision has to be read along with Order 6 Rule 14 of the Code of Civil Procedure which is a provision concerning verification of the pleading. Under Order 6 Rule 14 of the Code of Civil Procedure, a pleading is required to be signed by the party and its pleader if any. A conjoint reading of the said two provisions of the Code of Civil Procedure would make it clear that even in the absence of any formal authority or power of attorney having been executed a person referred to in Rule 1 of Order 29 of the Code of Civil Procedure by virtue of the office which he holds, sign and verify the pleadings by the corporation. As the company is a juristic entity it can duly authorize any person who signed the plaint or the written statement on its behalf and in such situation, it would be regarded as sufficient compliance with the provisions of Order 6 Rule 14 of the Code of Civil Procedure. As observed in UBI (supra), a person may be expressly authorized to sign the pleadings on behalf of the company, for example, by the Board of Directors passing a resolution to that effect or by a power of attorney being executed in favour of any individual. In absence thereof and in cases where pleadings have been signed by one of its officers a corporation can ratify the said action of its officer in signing the pleadings. Such ratification can be express or implied.
Applying the said principle, in the instant case, it could be seen that Ms. Veena Poolakal signed the plaint and the petition before the Delhi High in the capacity as a constituted attorney of the petitioners. The self-same person has also affirmed the plaint and the petition. At Delhi, the defendant never raised any objection with regard to the authority of Ms. Veena Poolakal to sign and verify and affirm the petition on behalf of the petitioners. Similar set of the documents accompanying the plaint duly verified with the necessary changes have been filed. The only exception is the authority of the present Solicitors to act on behalf of the plaintiff as different Solicitors were engaged at Delhi. A further set of documents have been subsequently produced authorizing Khaitan & Co. to act on behalf of the petitioner. The said power of attorney and the Board resolutions are all in order. The only person who could have objected to filing of the suit would have been the company. The said Special Power of Attorney has been signed by the said Vice President and General Counsel of Petitioner No.1 and has been apostilled in accordance with law. There is a further document dated 23rd July 2018 confirming that C. S. No. 43 of 2018 has been filed before this Hon'ble Court for and on behalf of Petitioner No.1 and had been initiated to protect Petitioner No.1's valuable trademark right in good faith and the attorneys representing Petitioner No.1 was duly authorised to do so. Whatever initial defects that were there have been cured. Rules of procedure are handmade of justice. It is the duty of the Court to ensure that procedural lapses do not stand in the way of dispensing substantive justice when such procedural lapses are curable. This view finds supports in UBI (supra) and All India Reporter Ltd. (supra).
Similar objection that the plaint was materially altered without seeking permission for amendment of the plaint and the 're-presented plaint' is not the original plaint also did not find favour in Hanamanthappa (supra). In the said decision it is stated that a fresh plaint on return of the plaint can be instituted subject to the laws of limitation, pecuniary jurisdiction and payment of court fees.
The cause of action for infringement and passing off is recurring and continuous in nature. The plaintiff can always file a fresh suit with additional pleadings provided the claims are not barred by law. In the instant case, the suit is not barred by law.
On such considerations, in my view, the petitioners are entitled to an order of injunction restraining the respondent, his officers, representatives and assigns from using the trade mark "Exon" or any other mark that is deceptively similar/identical to the petitioners' registered trade mark, "Exxon" in relation to his goods/products/services and in relation to his firm name. Considering the fact that the defendant appears to have been using "Exon" as his firm name for some time, he is granted a period of four weeks to make compliances of the present order.
The application being G.A. No.1052 of 2018 is allowed. However, there shall be no order as to costs.
Urgent Photostat certified copy of this judgment, if applied for, be given to the parties on usual undertaking.
(Soumen Sen, J.)