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R.M. Lodha, J.

Leave granted.

2. This appeal, by special leave, raises questions of legality of an ex parte decree passed by the trial court and affirmed in first appeal by the High Court of Madhya Pradesh.

3. M/s. M.S.S. Food Products--respondent (hereinafter referred to as `plaintiff') sued the appellants--(i) Dhariwal Industries Ltd. and (ii) Rasiklal Manikchand Dhariwal (hereinafter referred to as  `defendants') in the court of 1st Additional District Judge, Mandaleshwar (West) Madhya Pradesh for declaration that defendants do not have right to use the mark "Manikchand" to sell masala, gutka, supari, supari mix or any other goods which is deceptively similar to the mark "Malikchand'; for perpetual injunction restraining the defendants from dealing in or selling the above articles under the name/brand "Manikchand"; for rendition of the accounts of profits earned by the defendants by selling the said goods and other consequential reliefs.

4. The case of the plaintiff is this: Prabhudayal Choubey son of Ramprasad alias Malikchand started the business of supari, ayurvedic pan masala and ayurvedic medicines in the brand name "Malikchand" in the year 1959-60. He continued his business upto April 1986. Prabhudayal Choubey assigned his trade mark of supari and ayurvedic pan masala "Malikchand" to his son Ashok Sharma sometime in the month of April, 1986. Ashok Sharma continued his business of supari, ayurvedic pan masala and ayurvedic medicines etc. upto March 1992. Ashok Sharma assigned the trade mark "Malikchand", vide assignment deed dated April 1, 1992, to Kishore Vadhwani, proprietor of M/s. Tulsi Stores who continued with the business of pan masala, gutka, supari and supari mix etc. till March,  1996. Kishore Vadhwani further assigned the trade mark "Malikchand" to the plaintiff on April 1, 1996. Since then plaintiff has been carrying on the business of gutka, pan masala, mix supari etc. in the trade mark "Malikchand".

5. It is further case of the plaintiff that the defendants have started selling gutka, pan masala, supari, supari mix, zarda, etc. in the name of "Manikchand", - phonetically similar to the plaintiff's mark "Malikchand" - and thereby passing off their goods as and for plaintiff's goods. The plaintiff alleged that defendants have been selling the inferior quality goods resulting in huge losses to it.

6. The defendants filed written statement and traversed plaintiff's claim. They disputed plaintiff's claim of prior user and averred that name of Prabhudayal's father was Ramprasad and not Malikchand. They denied that any business was run by Prabhudayal Choubey in the name of "Malikchand". On the other hand, the defendants claimed that way back in 1966, an application for registration of trade mark "Manikchand" was submitted as the name of Defendant No. 2's father was Manikchand and they have been doing their business of supari, gutka, tobacco, etc. in the name of "Manikchand". It is the case of the defendants that the plaintiff started running business of gutka, using the name "Malikchand"  identical to the trade name of the defendants "Manikchand" wrongly and fraudulently with an intention to ride on the goodwill of the defendants and to protect their right, the defendants have filed a suit (Suit No. 574 of 2004) in the Bombay High Court wherein plaintiff's counsel appeared on March 10, 2004. As regards the documents concerning prior user of the trade name "Malikchand" by the plaintiff, the defendants averred that the plaintiff has fabricated and forged these documents and then filed the suit for passing off action, declaration and injunction. The defendants, thus, prayed that plaintiff's suit was liable to be dismissed.

"23. Consequently, finally having allowed the suit, decree has been issued that :-

(a) It has been declared that defendants do not have any right to sell Supari, Pan Masala, Mixed Supari, Gutka sell by packing in pouch under the name and trade mark "Manikchand".

(b) Defendants are hereby restrained by order of permanent injunction from selling the pouch of supari, pan masala and mix supari under the name Manikchand and should not copy the colour screen and design of "Manikchand" zarda pouch and should not advertise or publish their pouch of supari, pan masala, jarda under the trade mark "Manikchand".