Gujarat High Court
Nirav Nimmi Corporation vs Ashish Traders on 7 March, 2025
NEUTRAL CITATION
C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025
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Reserved On : 12/02/2025
Pronounced On : 07/03/2025
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/APPEAL FROM ORDER NO. 9 of 2025
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2025
In R/APPEAL FROM ORDER NO. 9 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE MAULIK J.SHELAT Sd/-
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Approved for Reporting Yes No
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NIRAV NIMMI CORPORATION
Versus
ASHISH TRADERS
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Appearance:
MR KALPESH C PATEL(5066) for the Appellant(s) No. 1
MR KIRTAN K PATEL(13023) for the Appellant(s) No. 1
MR TEJAS S TRIVEDI(5692) for the Appellant(s) No. 1
MS. NISHTHA A TRIVEDI(16306) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT
CAV JUDGMENT
1. The present appeal is filed under Order 43 Rule (1) (r) of the Code of Civil Procedure, 1908 (hereinafter referred to as "the CPC"), against the judgment and order dated 30th December, 2024 passed by the 4th Additional District Judge, Mehsana at Visnagar in Trademark Suit No. 1 of 2024. Page 1 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
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2. The short facts of the case are as under:
2.1 The appellant herein is the original plaintiff, and the respondent is the original defendant (hereinafter the parties will be referred to as per their original position in the suit).
2.2 The plaintiff is the proprietary firm and Piyushbhai Pukhraj Shah is its proprietor. The plaintiff is in the business of various spices, more particularly, cumin. The plaintiff firm using the mark "ARJUN" on its packing pouches since its inception i.e. 1988. The brand name - mark "ARJUN" gained popularity amongst trader/consumer etc. thereby, accepting and identifying it as mark of plaintiff.
2.3 It is further the case of the plaintiff that a firm, namely, Shah Maganlal Vajingji (hereinafter referred to as SMV), was using the mark "ARJUN". The father of the proprietor of the plaintiff, namely, Pukhrajbhai Shah, was running SMV firm, and Piyushbhai was used to do business with his father in SMV thereby, using the mark "ARJUN"
while selling spices. It is a case of plaintiff that on his demise, Page 2 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined SMV firm was converted into a partnership firm in the year, 1983, thereby the proprietor of the plaintiff, his brother - Subhashbhai, and his mother - Deviben became partners of SMV.
2.4 As per Clause 18 of the said partnership firm, in a case, any of the partners retired or the firm was closed then, on happening of such an event, no goodwill of the firm would be considered.
2.5 The proprietor of the plaintiff, namely, Piyushbhai and his mother - Deviben retired from the said partnership firm in the year, 1994.
2.6 Deviben also gave a declaration dated 23 rd November, 1994, thereby declaring that on the demise of her husband on 19th August, 1983, she and her two sons decided to convert the SMV - firm into a partnership firm and to run the business of spices under the brand name of "ARJUN." She further declared that the firm had business between the years 1983 to 1994, and she was looking after the affairs of the firm. She further Page 3 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined declared that she and her elder son, namely Subhashbhai, used to help the proprietor of the plaintiff in his independent business. She further declared that due to old age and the plaintiff's firm already doing his business since 1988, there was no need to continue the SMV partnership firm, which may be converted into a proprietary firm in favour of her elder son, namely, Subhashbhai. She has forgone all her rights, property, and assets in favour of the proprietary firm of her son - Subhashbhai.
2.7 In the very declaration, it has been clearly stated by her that a separate document dated 1 st April, 1994 has been executed for the dissolution of the partnership firm - SMV. 2.8 The plaintiff applied for the registration of the trademark "ARJUN" on 10th August, 1993. The trademark certificate was issued in favour of the plaintiff on 14 th June, 2000. Nonetheless, plaintiff was/is using the mark "ARJUN" on his packaging pouches while selling cumin and other spices in the open market since its inception.
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 2.9 The plaintiff has also produced an extract from the Register of Copyright Act, 1957 (hereinafter referred to as the Act,1957), issued on 18th May 2006, whereby the plaintiff contended that he is holding the copyright, "Title of the work
- ARJUN SPICES N.N.CORP. WITH DEVICE OF SPICES & ARJUN."
2.10 The certificate shows the name of the real owner as the plaintiff, and the work was first published in the year 1978.
2.11 Thus, in short, it is the case of the plaintiff that a trademark certificate in the name of "ARJUN" and also a copyright certificate for artistic work, which was printed on pouches, are also in favour of the plaintiff, having received the copyright certificate for such work thereby, it is registered proprietor of trade mark "ARJUN".
2.12 The brother of the plaintiff, namely, Subhashbhai, appears to have raised an objection about the granting of the trademark "ARJUN" in favour of the plaintiff by filing an Page 5 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined application in the year, 2022, which is pending before the appropriate adjudicating authority under the Trademark Act, 1999 (hereinafter referred to as the Act,1999). 2.13 It is the case of the plaintiff that the brother of the plaintiff had stopped doing business since 2004/2013, having surrendered his license under the Shop and Establishment Act, Sales Tax as well as APMC etc. It is further the case of the plaintiff that his brother - Subhashbhai was, in fact, employed in the plaintiff's firm and drew a salary. 2.14 The defendant was a distributor and dealer of the plaintiff, thereby permitted to sell the product of the plaintiff in the packaging pouches of the plaintiff under the brand name and style of "ARJUN."
2.15 Later on, it came to the notice of the plaintiff that the defendant had started engaging in unethical business practices, which severely damaged the plaintiff's reputation and goodwill associated with the ARJUN Marks. The defendant had not stopped such activity despite requested by plaintiff. It came to Page 6 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined plaintiff's notice that erstwhile owner of defendant namely Sureshbhai Shah had introduced the impugned goods into the market under the impugned Mark, whereby, involved in the unauthorized sale of goods (spices) under the Mark "ARJUN" albeit, branding it "Marketed" in defendant's name on its selling pouch.
2.16 The plaintiff had initially issued public notices against counterfeit products under the "ARJUN" mark in October, 2023. Later on, in May, 2024, it came to know that the defendant again resumed infringing activities, thereafter obtaining necessary confirmation against the unauthorized use of the "ARJUN" mark by the defendant, resulted in the filing of a trademark suit against the defendant. 2.17 The Trial Court appears to have granted an ex-parte ad-interim injunction in favour of the plaintiff on 28-10-2024, which is continued till passing of the impugned order and thereafter extended till date.
2.18 The defendant appeared and filed its written statement Page 7 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined through its power of attorney, namely, Shah Subhashbhai Pukhrajbhai, who happens to be the elder brother of the proprietor of the plaintiff's firm and proprietor of SMV. 2.19 It is the case of the defendant that the plaintiff was neither a prior user nor a registered proprietor of the Mark "ARJUN," as the mark "ARJUN" was owned by the SMV firm. 2.20 The defendant further contended that the mark, which was registered by the plaintiff in its name is already opposed by the proprietor of the SMV - firm, namely, Subhashbhai, the power of attorney holder of the defendant, before the competent authority, which is pending. So, the present suit and injunction proceedings cannot be proceeded further in light of Section 124 of the Act,1999.
2.21 The defendant has opposed the suit further on the ground that Piyushbhai - the proprietor of the SMV - firm, has permitted both the plaintiff and the defendant to use the mark "ARJUN," and as the SMV - firm is a prior user of the mark "ARJUN," the plaintiff cannot be permitted to use the mark Page 8 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined "ARJUN."
2.22 It is further the case of the defendant that once the plaintiff and his mother retired from the SMV - firm, the plaintiff cannot be permitted to own the mark "ARJUN," and no exclusivity of such mark can be granted in favour of the plaintiff.
2.23 The jurisdiction of the Trial Court is also questioned by the defendant. The defendant is using the mark "ARJUN" as per the consent of its real owner - Shah Subhashbhai, and has been using it since long, and therefore, no injunction can be granted in favour of the plaintiff.
2.24 After hearing the parties at length, the Trial Court rejected the injunction application in its impugned judgment and order dated 30th December, 2024, holding that no prima facie case has been made out by the plaintiff, and thereby no injunction can be granted in favour of the plaintiff. Consequently allowed an application of defendant filed below Ex.11 thereby, allowed defendant to sell its goods seized by Page 9 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the trial Court's order.
3. SUBMISSION OF THE APPELLANT - PLAINTIFF 3.1 Learned Senior Counsel Mr.Harshit Tolia would submit that the Trial Court has completely lost sight of the different provisions of Act, 1999 and Act, 1957 and did not appreciate Sections 28, 29, 31 and 34 of the Act, 1999 and Sections 14, 48, 51 of the Act, 1957.
3.2 Learned Senior Counsel Mr.Harshit Tolia would submit that section 34 "Protects the rights of the registered proprietor when the opposing party has not demonstrated continuous use of the trademark". He would submit that the Trial Court itself admitted that Subashbhai's use of the "ARJUN" mark ceased in 2013. Factually, Subahbhai Shah discontinued his business operations in 2004 and surrendered his Sales Tax Registration Certificate under (SMV) due to the closure of the business. This discontinuation disqualifies Subashbhai from claiming any prior user rights, thereby nullifying any defence based on prior use. 3.3 Learned Senior Counsel Mr. Harshit Tolia would Page 10 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined submit that the Defendant does not qualify as a permitted user of Subashbhai's trademark under Section 2(1)(r) of the Trade Marks Act. As per this provision, a permitted user refers to a person who has been duly authorized, through a written agreement, by the registered proprietor of the trademark to use the mark in relation to specific goods or services. Furthermore, Section 49(1)(a) of the Trade Marks Act clearly states that any license or permitted use of a trademark must be in writing, However, no such written agreement or authorization exists between Subashbhai and the Defendant in the present case. Therefore, the Defendant's use of the trademark is unauthorized and does not fall within the legal definition of a permitted user under the Act.
3.4 Learned Senior Counsel Mr. Harshit Tolia would submit that as per Section 48 of the Act, 1957, the registration of the plaintiff's copyright in the "ARJUN" Label serves as prima facie evidence of the particulars entered therein. This statutory protection reinforces the plaintiff's exclusive rights Page 11 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined over the ARJUN mark, further invalidating the Respondent's claims.
3.5 Learned Senior Counsel Mr. Harshit Tolia would submit that it is important to note that the "ARJUN" label, designed by Piyushbhai in 1978, was registered under the Copyright Act in 2006 while Subashbhai was an employee of the plaintiff. This registration serves as prima facie evidence of the plaintiff's rights, which the Trial Court failed to consider. 3.6 Learned Senior Counsel Mr. Harshit Tolia would submit that the Trial Court has grossly erred by recognizing rights allegedly held by Subashbhai Pukhrajbhal Shah, who was merely an employee of the plaintiff and held no ownership or authority over the "ARJUN" trademark. This misapprehension led to an unjust conclusion that undermines the plaintiff's established proprietary rights. 3.7 Learned Senior Counsel Mr. Harshit Tolia would submit that in the rectification application filed by Subushbhai against the plaintiff's registered trademark "ARJUN", both Page 12 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined Subashbhai and the late father of the Respondent explicitly admitted that they had no objection to the registration of the "ARJUN" trademark in the plaintiff's name. This admission directly contradicts any claims of prior rights or ownership by the Respondent and highlights the baselessness of the rectification petition.
3.8 Learned Senior Counsel Mr. Harshit Tolia would submit that defendant is using the symbol with the "ARJUN" trademark, despite the fact that only the plaintiff is the registered proprietor of the trademark "ARJUN". The unauthorized use of the symbol indicates an attempt to mislead the public into believing that defendant holds legitimate rights over the trademark. This misuse further reveals that defendant was merely a dealer or distributor of the plaintiff's goods bearing the "ARJUN" mark and had no independent rights over the trademark.
3.9 The Respondent's claim that Subashbhai granted a license to use the "ARJUN" trademark is an afterthought with Page 13 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined no legal or factual basis. There is no written agreement or any evidence to substantiate such a license or permission, as required under Section 49(1)(a) of the Trade Marks Act. This fabricated narrative holds no relevance in the present proceedings and is a desperate attempt to justify the defendant's unauthorized and deceptive use of the trademark while benefiting from the plaintiff's established reputation and goodwill.
3.10 Learned Senior Counsel Mr.Harshit Tolia would submit that the defendant is a dishonest adopter of the plaintiff's registered "ARJUN" trademark. Having previously acted as an agent or distributor for the plaintiff, the defendant was fully aware of the plaintiff's exclusive rights over the trademark. At no point did the defendant challenge the plaintiff's registration of the "ARJUN" mark, further underscoring the defendant's acknowledgment of the plaintiff's ownership. The defendant's current unauthorized use of the trademark is a clear act of bad faith, intended to misappropriate the plaintiff's market Page 14 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined reputation and goodwill.
3.11 Learned Senior Counsel Mr.Harshit Tolia would submit that Subashbhai Shah never challenged the registration or proprietorship of the plaintiff's "ARJUN" trademark for more than 22 years, until the filing of the rectification application in 2022. This prolonged inaction clearly indicates acknowledgment and acceptance of the plaintiff's exclusive rights over the trademark. The rectification application, which appears to be an afterthought, is still pending decision before the competent authority.
3.12 Learned Senior Counsel Mr. Harshit Tolia would submit that the Trial Court acknowledged that no goodwill was transferred to Subashbhai during the dissolution of SMV in 2004. Yet, paradoxically, it concluded that Subashbhai continued to use the "ARJUN" mark, without any evidence. This contradiction reveals a perverse interpretation of facts and disregards the plaintiff's continuous and exclusive use of the trademark since 1988.
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 3.13 Learned Senior Counsel Mr. Harshit Tolia would submit that the plaintiff has invested substantial resources in marketing, promoting, and maintaining the reputation of the "ARJUN" trademark, leading to significant goodwill and consumer recognition. The defendant's actions constitute a deliberate attempt to exploit this goodwill. further proving their intent to deceive consumers and unfairly benefit from the plaintiff's established market presence. 3.14 Learned Senior Counsel Mr. Harshit Tolia would submit that defendant, a former distributor appointed in 2015- 19, has adopted identical packaging and trade dress to that of the plaintiff. The Court Commissioner appointed under Order XXVI Rule 9 CPC, found Infringing pouches alongside original "ARJUN" pouches during the search of the defendant's premises in October 2024. This clearly establishes deliberate passing off and consumer confusion.
3.15 Making the above submission, he would request this Court to allow the present appeal from order. Page 16 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
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4. SUBMISSION OF THE RESPONDENT - DEFENDANT 4.1 Learned advocate Mr. Mod. Bilal with learned advocate Mr. Nirad D. Buch & learned advocate Ms. N.A.Trivedi, appearing for the respondent-defendant, would submit that registration does not grant any rights over a trademark or copyright if the rights does not already exist prior to such registration. It is in relation to prior user and admittedly, the plaintiff is not a prior user and there is no written assignment in his favour from alleged prior user, namely, Piyushbhai. Whereas, defendant is permitted by Piyushbhai to use Trade name "ARJUN".
4.2 Learned advocate Mr. Bilal would further submit that in infringement suit, appellant (i.e. plaintiff) must establish validity of its registration first.
4.3 Learned advocate Mr. Bilal would further submit that Court can go into the validity of trademark registration even at the stage of temporary injunction.
4.4 Learned advocate Mr. Bilal would further submit that Page 17 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined in registered trademark application, the plaintiff has claimed user date of 1978 whereas the other 3 registered trademark applications are, till date, on proposed to be used basis. However, in the present appeal the plaintiff has claimed user date of 1988 over the subject mark.
4.5 Learned advocate Mr. Bilal would further submit that in the suit and applications, the plaintiff has claimed 5 separate dates of its rights/usage for the same subject mark i.e. 1957, 1978, 1988, 1993, 1998, without specifying how it got rights on any of such dates. Furthermore, he would submit that despite such different dates of claimed rights, the oldest document produced by plaintiff is of the year 2000. 4.6 Learned advocate Mr. Bilal would further submit that despite entirely relying on Sections 31 of Act, 1999 and 48 of Act, 1957 plaintiff neither filed originals nor certified copies of any of such registrations nor an exemption application- being mandatory requirement of the sections. Moreover, no affidavit under Section 63 of Bhatirya Sakshya Adhiniyam, 2023 is filed Page 18 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined despite all being digital records.
4.7 Learned advocate Mr. Bilal would further submit that despite claiming rights on mark - "ARJUN" on the basis of registration, the plaintiff has no registration for the Mark
-"ARJUN" and hence barred for claiming rights over individual elements of their registered logos/devices, as per Section 15 and 17 of Act, 1999.
4.8 Learned advocate Mr. Bilal would further submit that no documents/records of any adoption/publication or of any use of the claimed logo/device has been filed. The said logo/device has already been admitted to be first published in the year 1957 and no registration for the Mark - "ARJUN" is in favour of the plaintiff. Learned advocate Mr. Bilal would further submit that no right over trademark or copyright can be derived from continuous usage if the adoption is not by the same entity/individual and there is no assignment or transmission in its favour.
4.9 Learned advocate Mr. Bilal would further submit that Page 19 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined defendant has filed documents from the year 1983 of the usage of the subject mark by the SMV - firm. When the partnership was structured, the subject mark became a property of the partnership firm as per Section 14 of the Partnership Act, 1932. When the plaintiff and his mother willingly resigned from it, the partnership was converted into a single proprietorship firm of Subhashbhai by efflux of law and both the outgoing partner did not take any properties and assets of the firm and thus the subject mark remained with Subhashbhai under his single proprietorship firm - Findings of facts recorded by trial court.
4.10 Learned advocate Mr. Bilal would further submit that sole Proprietorship firm is not a separate legal entity and has no separate identity than its proprietor and even if SMV was assumed to be closed, the rights over the subject mark remained with Subhashbhai as all rights and assets of single proprietorship firm are of its proprietor alone. 4.11 Learned advocate Mr. Bilal would further submit that Page 20 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined since Subhashbhai has permitted defendant as well as the plaintiff (till the year 2022), there was no non-usage/abandonment of rights by Subhashbhai as even if the proprietor is not using a trademark and its usage is by another individual permitted by the proprietor, its usage amounts to goodwill in favour of the proprietor. 4.12 Learned advocate Mr. Bilal would further submit that if the trial court in a case of this nature has refused to exercise discretion in favour of the plaintiff, the Appellate court cannot either reassess materials on record or reverse such discretion even if it takes a different view meaning thereby, cannot substitute its own discretion, provided such exercise of discretion by trial court was on objective consideration of materials and supported by cogent reasons. Such discretion of the trial court can only be reversed if the trial court did not apply principles of law correctly or acted arbitrarily, estat perversely or capriciously.
4.13 Learned advocate Mr. Bilal would further submit that Page 21 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined permission to use the trademark can be oral and need not be in writing.
4.14 Learned advocate Mr. Bilal would further submit that since the permission has been withdrawn from the plaintiff by Subhashbhai, he himself is an infringer/illegal user and passing-off goods of Subhashbhai. Learned advocate Mr. Bilal would further submit that one alleged infringer of a trademark/copyright cannot sue another and if the plaintiff himself does not have any prior rights over trademark, he can obtain no equitable/injunctive relief. 4.15 Learned advocate Mr. Bilal would further submit that Subhashbhai, who filed rectification/oppositions on plaintiff's applications, is disputing the rights of plaintiff since 2022 and plaintiff also had knowledge that Subhashhbhai has declared in such petitions that defendant is its permitted user. The duty was upon appellant/plaintiff to include Subhasbhbhai (necessary party) in the present suit and cannot take advantage of its own wrong.
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 4.16 Lastly, learned advocate Mr. Bilal would further submit that following material concealments by plaintiff in suit, which disentitles him from claiming interim relief based on equity:-
4.16.1 In the present case, plaintiff made no averment/disclosure about the structure of the firm SMV, its structural changes over time and that the plaintiff was itself its partner and retired/resigned from it willingly.
4.16.2 Plaintiff did not disclose that rights over the Mark are being disputed by his own elder brother.
4.16.3 Plaintiff did not disclose that it has submitted in its evidence affidavit that it acquired rights through "transfer" despite not producing any written assignment deed.
4.16.4 Plaintiff did not disclose that the Respondent is purchasing merely raw materials from the plaintiff and packaging and placing the subject mark on its own. 40+ invoices have been filed by Page 23 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined Respondent to prove such facts all of which are w/o the subject mark and since the year 2017. However, despite claiming that the Respondent is its wholesaler, plaintiff only produced 5 invoices only of the year 2021 and 2022.
4.16.5 Plaintiff claimed that it stopped supplying goods to the Respondent in October, 2023, however invoices and ledger of the Respondent with plaintiff proves that he was supplying such goods on constant basis till August, 2024.
4.16.6 Prior adoption and use of the subject mark by another individual/entity (i.e., SMV) than the plaintiff.
4.17 Moreover, learned advocate for the defendant would submit that there are material delay, laches and acquiescence and the present suit is for injunction simpliciter seeking relief of declaration despite the suit property being disputed and also barred by Section 41(h) of the Specific Relief Act.Page 24 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 4.18 Making the above submissions, he prayed to reject the present appeal.
5. POINTS OF DETERMINATION 5.1 The following points are considered in regard to the issue involved in the suit, which read as under:
1. Whether, in the facts and circumstances of the case, can this court interfere with the impugned order by exercising its power under Order 43 Rule 1 of the CPC?
2. Whether, in the facts and circumstances of the case, the Trial Court has committed an error of law by holding that the plaintiff has not made out any prima facie case?
3. Whether, in the facts and circumstances of the case, the plaintiff has made out a case that it is holding registration certificates under the Trademark Act and Copyright Act respectively in relation to the name and work of "ARJUN"
on its selling pouches?
4. Whether, in the facts of the case, the plaintiff is entitled to get an injunction as prayed for in its injunction application or not? ANALYSIS
6. Before adverting to the issues germane in the present appeal, I would like to remind myself of the limitation of this Page 25 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined court while exercising its power under Order 43 of the CPC, which is so clearly held by the Honorable Supreme Court of India in its following decisions.
i. Wander Ltd V/s Antox India P. Ltd. reported in 1990 (1) Supp. SCC 727;
ii. Ramakant Ambalal Choksi V/s Harish Ambalal Choksi reported in 2024 SCC Online SC 3538.
7. What is culled out from the aforesaid decision of the Honorable Apex Court of India is that the appellate court should not exercise its power under Order 43 of the CPC, unless and until there is arbitrariness, perversity, erroneous observation and the issue is decided contrary to the settled position of law. The appellate court should not disturb the discretionary order passed by the Trial Court while granting or refusing an injunction application filed under Order 39 Rule 1 of the CPC.
8. Keeping in mind the aforesaid ratio of both the decisions, I would like to examine the issues cropped up and raised in Page 26 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the appeal by the plaintiff.
9. The following facts, which remained undisputed before the Trial Court, reads as under:
9.1 One Pukhrajbhai, who happens to be the father of the proprietor of the plaintiff, namely, Piyushbhai, and Subhashbhai - the power of attorney holder of the defendant, had started a business in the name of the SMV - firm. The firm was selling its goods and spices, more particularly, cumin under the brand name of "ARJUN."
9.2 The SMV - firm was converted from a proprietary firm to a partnership in the year 1983 on the demise of the father of the plaintiff, and the proprietor of the plaintiff, namely, Piyushbhai, and Subhashbhai, the power of attorney holder of the defendant. Piyushbhai, Subhashbhai, and their mother Deviben became partners of the SMV partnership firm.
9.3 Clause-18 of the partnership firm clearly states that in case, any of the partners retired or the firm was closed, there would not be any goodwill of the firm.Page 27 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 9.4 The SMV - partnership firm was dissolved on 31st March, 1994, which is confirmed from the declaration and statement of Deviben, the mother of Piyushbhai and Subhashbhai. The plaintiff - firm has been doing business since 1988 in the area of selling spices, more particularly, cumin.
9.5 The SMV - partnership firm again got converted into the proprietary firm of Subhashbhai, as Piyushbhai and his mother - Deviben retired from the firm. The SMV - partnership firm, which was using the mark "ARJUN," got dissolved on 31st March, 1994.
9.6 As per Clause-18 of the partnership deed of the SMV - firm, it was clearly spelt out that either on retirement or dissolution of the firm, there would not be any goodwill of the firm. So, Subhashbhai, who became the proprietor of the SMV
- firm, could not have carried the goodwill of the SMV partnership firm, thereby could not have exclusive rights or ownership of the mark "ARJUN".
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 9.7 The plaintiff applied for the trademark "ARJUN" on 10th August, 1993, and registration was granted on 14th June, 2000, with effect from 10th August, 1993, which is admittedly prior to the dissolution of the SMV - partnership firm. The plaintiff has also obtained a copyright certificate for artistic work, which was published for the first time in the year, 1978, and the name of the applicant is shown as Piyushbhai Shah, namely, the proprietor of the plaintiff - firm. The extract of such a certificate is produced on record and confirms the aforesaid facts.
9.8 Thus, the plaintiff is holding a certificate of the trademark "ARJUN" and also holding a copyright certificate in its name.
10. Subhashbhai - the proprietor of the SMV - firm, appears to have closed down his business long back in the year, 2013, and there was no evidence to show that as on the date of filing of the suit, he was doing any business in the name and style of SMV - firm. The plaintiff - firm has submitted its Page 29 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined accounts to show that Subhashbhai was employed by it and used to pay a salary to Subhashbhai.
11. It is true that the power of attorney holder of the defendant, namely, Subhashbhai, who happens to be the brother of Piyushbhai - the proprietor of the plaintiff, has submitted an objection to such a trademark vide his application dated 6th January, 2022 before the competent authority under the Act, 1999, which is pending for its adjudication. Nonetheless, when the plaintiff applied for trademark in the year, 1993, at that time, Subhasbhai has not objected to such application.
12. Once it has come on record that the plaintiff is holding the registration of the trademark "ARJUN" and the copyright certificate, the observation of the Trial Court ignoring both the certificates that the plaintiff has not made out a prima facie case is an erroneous finding on the part of the Trial Court.
13. Thus, the suit in question is filed for infringement of Trademark and Copyright as well as passing off of trademark. Page 30 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
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14. It is a well-settled legal position that if the trademark is registered, undisputedly, the use thereof by a person who is not authorized to do so, would constitute infringement. A proprietor of a registered trademark undisputedly has a statutory right thereto. If other than permissible user uses it, such a proprietor will have a statutory remedy in terms of Section 29 of the Act, 1999.
15. At this stage, it is profitable to refer to and rely upon the decision of the Honorable Apex Court of India in the case of Ramdev Food Products (P) Ltd. vs. Arvindbhai Rambhai Patel, reported in 2006 (8) SCC 726; 2006 (0) AIJEL-SC 37749, in paras 52 and 114, wherein it has been held as under:-
"Purpose of Trade mark
52. A trade mark is the property of the manufacturer. The purpose of a trade mark is to establish a connection between the goods and the source thereof which would suggest the quality of goods. If the trade mark is registered, indisputably, the user thereof by a person who is not otherwise authorised to do so would constitute infringement. Section 21 of the 1958 Act provides that where an application for registration is filed, the same can be opposed. Ordinarily under the law and, as noticed hereinbefore, there can only be one mark, one source or one proprietor. Ordinarily again right to user of a trade mark cannot have two origins. The first respondent herein is a rival trader of Page 31 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the plaintiff-Company. It did not in law have any right to use the said trade mark, save and except by reason of the terms contained in the MOU or continuous user. It is well-settled that when defences in regard to right of user are set up, the onus would be on the person who has taken the said plea. It is equally well-settled that a person cannot use a mark which would be deceptively similar to that of the registered trade mark. Registration of trade marks is envisaged to remove any confusion in the minds of the consumers. If, thus, goods are sold which are produced from two sources, the same may lead to confusion in the mind of the consumers. In a given situation, it may also amount to fraud on the public. A proprietor of a registered trade mark indisputably has a statutory right thereto. In the event of such use by any person other than the person in whose name the trade mark is registered, he will have a statutory remedy in terms of Section 21 of the 1958 Act. Ordinarily, therefore, two people are not entitled to the same trade mark, unless there exists an express licence in that behalf.
113. Registration of a trade mark and user thereof per se may lead to the conclusion that the plaintiff has a prima facie case, however, existence thereof would also depend upon the determination of the defences raised on behalf of the respondents. The plaintiff has raised a triable issue. The same by itself although may not be sufficient to establish a prima facie case but in view of our findings aforementioned, we are satisfied that the plaintiff has been able to establish existence of a legal right in itself and violation of the registered trade mark on the part of the respondents. We have also considered the comparable strength of the cases of the parties and are of the opinion that the case of the plaintiff-appellant stands on a better footing than the defendants-respondents."
(Emphasis Supplied)
16. The Trial Court erroneously observed in para-27 of its impugned judgment that due to the dispute between the plaintiff and Subhashbhai for the trademark "ARJUN" pending before the competent authority, the injunction application Page 32 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined cannot be decided. Such an observation of the Trial Court is in complete ignorance of Section 124(5) of the Act, 1999. Section 124(5) of the Act, 1999 reads as under:
"124. Stay of proceedings where the validity of registration of the trade mark is questioned, etc.--
(5) The stay of a suit for the infringement of a trade mark under this section shall not preclude the court from making any interlocutory order (including any order granting an injunction directing account to be kept, appointing a receiver or attaching any property), during the period of the stay of the suit."
17. The Trial Court has further erroneously observed in para- 28 of its judgment that neither the defendant nor Subhashbhai has allowed the plaintiff to register the mark "ARJUN" at the time of its registration and further erroneously observed that when the plaintiff and his mother waived their rights in favour of Subhashbhai, who has been using the mark "ARJUN" since long, no infringement can be claimed against Subhashbhai as per Section 29 of the Act, 1999. The Trial Court is oblivious of the crucial fact that the suit is not filed against Subhashbhai but against the defendant firm, namely, Ashish Traders, albeit, the written statement was filed by Subhashbhai as the power of attorney holder of the defendant - Ashish Traders. Page 33 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
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18. The Trial Court has escaped from its notice the crucial fact that Subhashbhai has discontinued his proprietary firm, namely, the SMV firm, since 2013 by surrendering its license under the Shop and Establishment Act and APMC, as the case may be. The relevant documentary evidence is submitted by the plaintiff, which is not controverted by the defendant. Even it is not the case of the defendant that SMV - Firm is alive as on date.
19. So, as on the date of filing of the suit, nothing is on record to substantiate the claim of the defendant that Subhashbhai was running his business in the name of the SMV
- firm by using the mark "ARJUN."
20. When the plaintiff has, prima facie, established on record that he is not only having the registration of the mark "ARJUN" with effect from 10th August, 1993 and 14th June, 2000 but also prima facie proved that it is holding the copyright certificate showing first publication in the year, 1978, and having come on record that Subhashbhai has Page 34 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined discontinued his firm after 2013, it entirely collapses the defense of the defendant about given permission by Subhashbhai being prior user of the mark "ARJUN" to the defendant to use it.
21. Such an aspect of prior user and user of the mark in the context of Section 34 of the Act,1999 has been succinctly observed and discussed by the Bombay High Court [Honorable Mr. Justice D.Y. Chandrachud, as he then was], in the case of Kamat Hotels (India) Ltd. vs. Royal Orchid Hotels Ltd. , reported in 2011 SCC Online Bom 460, in paras 19 and 20, wherein it has been held as under:
"[19] In order to avail of the benefit of Section 34 of the Trade Marks Act 1999 the mere change of name of the First Defendant with effect from 10 April 1997 will not suffice. The First Defendant must demonstrate that the mark was utilized in relation to the goods and services for which the mark of the plaintiff was registered and that the use of the First Defendant was prior to the registration, or as the case may be, the use of the mark by the plaintiff. In this regard, reliance has been sought to be placed on behalf of the First Defendant on certain circumstances in the affidavits in reply to which it would now be necessary to turn. The first of those circumstances is the alleged adoption of the mark "Orchid" in respect of a banquet room at Hotel Harsha in Bangalore. In the Bangalore edition of the Times of India of 30 December 1990 there is a publication in respect of the Orchid room at Harsha Hotel. The next document is a report dated 23 April 1999 of the Zonal Manager in ICICI prepared in the context of a new project of the First Page 35 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined Defendant. The report inter alia states that the First Defendant had been promoted by C.K. Baljee. Baljee had promoted a company by the name of Baljees Hotels and Real Estates Private Limited in 1973 and took over a Two Star Hotel, Hotel Harsha in Bangalore on an operational lease from Hotel Stay Longer Private Limited (HSPL). Baljee had since acquired the controlling interest in HSPL which owned Hotel Harsha. Counsel appearing on behalf of the First Defendant also purported to rely upon a letter addressed to the Joint Director of Town Planning at Bangalore on 16 September 1999 and a certificate dated 17 December 1999 issued by the Government of India in the Ministry of Commerce and Industry. [20] All these documents (save and except for the isolated advertisement of 1990) relate to the period after the plaintiff had commenced the use of the mark "Orchid". Those documents do not even prima facie establish a use, much less continuous use, prior to the date on which the plaintiff had commenced the use of the mark. Significantly, the First Defendant has not disclosed any sales figures that would establish a continuous course of use of the mark "Orchid" prior to the date on which the plaintiff commenced the use of the mark. There is merit in the contention which has been urged on behalf of the plaintiff that the reference to a room in Hotel Harsha as being the Orchid room is not sufficient to establish within the meaning of Section 34 a continuous use by the First Defendant of the mark in relation to the goods and services for which the mark has been registered by the plaintiff. But it is important to note that the First Defendant is unable to establish by any cogent documentary material the existence of such continuous use. Where a Defendant sets up a defence under Section 34, the consequence of allowing it is to dilute the protection granted to a proprietor of a registered mark. The Defendant must be held down to establish the requirements of Section 34 by cogent material which indicates continuous prior use. A single swallow does not make a summer. The Defendants have not established a crucial requirement of Section 34."
(Emphasis Supplied)
22. The Trial Court has again committed a serious error by erroneously observing in para 31 that the father of the plaintiff and the defendant was using the name "ARJUN" while doing Page 36 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined business in the name of the SMV - firm. Admittedly, as on date of suit, the proprietor of the defendant firm is not the real brother of the proprietor of the plaintiff - firm. The power of attorney of holder of the defendant - firm, of course, is the real brother of the proprietor of the plaintiff firm. It appears that the Trial Court has erroneously and perversely treated the relationship of the power of attorney of the defendant firm with the plaintiff as a relation of the defendant itself with the plaintiff.
23. The Trial Court has further committed a serious error of law by observing in paras 38 and 41 that when Subhashbhai has allowed both the plaintiff and the defendant to use the mark "ARJUN," it would not be the exclusive right of the plaintiff to use the mark "ARJUN." It is an admitted position that no written agreement was entered into between Subhashbhai and the defendant for using the mark "ARJUN,"
and then, prima facie, under Section 2 (1) (r) (ii) (c) of the Act, 1999, the defendant would not fall within the category of Page 37 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined permitted user of the trademark. So far as the plaintiff - firm is concerned, it is a registered mark holder as referred to hereinabove.
24. Likewise, the Trial Court has recorded a perverse finding that merely because the plaintiff firm has registration of the trademark "ARJUN" under the Act, 1999 and copyright under the Act, 1957, it would not ipso facto wipe out the right of Subhashbhai over the brand name "ARJUN." The suit is not filed against Subhashbhai but against the defendant - firm, wherein Subhashbhai was neither a partner nor acted with the defendant - firm except as the power of attorney holder. It seems that the Trial Court has considered the defence of the defendant from the eye of the power of attorney holder of the defendant rather than from the defendant firm itself. Because of such an erroneous and perverse approach on the part of the Trial Court, it has resulted in refusing the injunction in favour of the plaintiff.
25. The Trial Court has further erroneously observed that the Page 38 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined plaintiff has come before the Court after a period of one year from knowing the fact that the defendant - firm is infringing his mark and selling the product under the brand name of "ARJUN" in society, thereby not being entitled to claim an injunction. Such an approach on the part of the Trial Court is erroneous and perverse and contrary to the law laid down by the Honorable Supreme Court of India in the case of Midas Hygiene Industries (P) Ltd Versus Sudhir Bhatia reported in (2004) 3 SCC 90, wherein in para 5, it has been held as under:-
"[5] The law on the subject is well settled. In cases of infringement either of trade mark or of copyright, normally an injunction must follow. Mere delay in bringing action is not sufficient to defeat grant of injunction in such cases. The grant of injunction also becomes necessary if it prima facie appears that the adoption of the mark was itself dishonest."
(Emphasis supplied)
26. It also remains undisputed during the course of the hearing of the appeal that as per Clause 18 of the partnership deed of the SMV - firm, it has been agreed between the partners of the SMV - firm, namely, Piyushbhai, Subhashbhai Page 39 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined and Deviben, that in a case where the firm gets dissolved or any of the partners retires from the firm, there would not be any goodwill of the firm.
27. When Piyushbhai - the proprietor of the plaintiff - firm and his mother - Deviben retired from the firm in the year, 1994 as well as the firm got dissolved, there would not be any goodwill of the firm, thereby, prima facie, the mark "ARJUN" could not have been an exclusive right in favour of Subhashbhai, who became the proprietor of the SMV proprietary firm.
28. In the case of a trademark, it has always been considered as a vital and inseparable part of the goodwill of the business. Once there is no goodwill of a business, the question of using and having an exclusive right to the trademark used by the firm would not arise. It is profitable to refer to the observation made by the Honorable Supreme Court of India in the case of Ramdev (supra), wherein in paras 59 and 60, it has been held as under:
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined "Trade mark and goodwill
59. Traditionally, a trade mark has always been considered a vital and inseparable part of the goodwill of the: business. In fact, the sale of a trade mark without the sale of the goodwill to the same buyer is considered null and void. However, the trade mark can be assigned with or without the goodwill of business though subject to certain conditions. [See V.A. Mohta's Trade Marks, Passing Off and Franchising, pages 12,
313.] Entitlement to use
60. The contention of the appellant before the courts below was that its right to the said trade mark has been entrenched by the respondents on account of use of the same as part of the trade name in view of the fact that although it has started the business in the trade name 'Swad', the first respondent, on the label and the packing material of the said product, had printed the name of the manufacturer 'Ramdev Masala' in such a prominent manner that the same would create an impression in the mind of the ordinary unwary customer that the same is a product of the appellant Company. It also alleged that the respondents had adopted advertisements, marketed and displayed boards in such a manner so as to deliberately deceive the customer."
(Emphasis supplied)
29. So, when the SMV firm got dissolved in the year, 1994, and later on, Subhashbhai discontinued his SMV - proprietary firm in the year, 2013, he would not be holding any goodwill of the firm with him, which can be assignable in favour of anyone in light of the aforesaid peculiar facts and circumstances of the case, which have come on record. Page 41 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
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30. Now, when the plaintiff has established a prima facie case that the plaintiff is having registration of the trademark under the Trademark Act, 1999 in its favour since 1993, and also having registration under the Copyright Act, 1957, the relief by way of an interim injunction would be material in a suit for infringement of a trademark. Furthermore, the defendant was neither a prior user than the plaintiff nor having any written assignment of using the mark "ARJUN" from an alleged permitted user, nor holding any registration mark of "ARJUN" in his favour. So, defendant cannot be permitted to use the mark "ARJUN" on packaging pouches for selling spices, more particularly, cumin. The colour of the pouches carrying the name "ARJUN" used by the plaintiff - firm as well as the defendant - firm was submitted before the Trial Court and the same is submitted for ready perusal of this court during the course of the argument, which prima facie clearly establish that the mark used by the defendant - firm is deceptively similar to that used by the plaintiff - firm, who is Page 42 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the registered mark holder of "ARJUN."
31. As the defendant is using the same product as the plaintiff, albeit, using the registered name of the plaintiff -
"ARJUN" on his pouches, the balance of convenience would be in favour of the plaintiff, being not only a prior user but also holding the registration mark in his favour.
32. So far as the question of irreparable loss is concerned, it would tilt in favour of the plaintiff as the product used by the defendant is the same as that used by the plaintiff, thereby a common user, who uses such product gets confused while buying such product, thereby it seriously affects the reputation of the plaintiff's firm, established since 1988 in the market.
33. As such, in this type of case, actual irreparable loss is not required to be established on record. At this stage, it is profitable to refer to and rely upon the observation made by the Honorable Supreme Court of India in the case of Ramdev (supra), wherein in paras 121, 122, and 123, it has been held as under:-
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NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined "121. Kerly's Law of Trade Marks and Trade Names, Thirteenth Edition states as under about the general test for grant of an interim injunction:
"In trade mark infringement cases irreparable damage, in this sense, is relatively easily shown, since infringement may easily destroy the value of a mark or at least nullify expensive advertising in a way that is hard to quantify for the purposes of an inquiry into damages. This has more recently come to be referred to, in cases where the defendant's conduct is not directly damaging but merely reduces the distinctive character of the claimant's mark, as "dilution"....
...In particular, although it is usually neither necessary nor appropriate to assess the degree of probability of success which the claimant's action has (provided that it is arguable, and subject to the principle of American Cyanamid that the merits may be resorted to as a 'tie breaker' if the balance of convenience is very even,) in trade mark and passing off cases, it is very hard to avoid doing so, since the better the claimant's case on the likelihood of deception (frequently the major issue) the greater the harm which he is likely to suffer. Accordingly, in appropriate cases, where the state of the evidence permits it, the court may seek to weigh up the merits in deciding whether to grant interim relief."
122. Thus, when a prima facie case is made out and balance of convenience is in favour of the appellant, it may not be necessary to show more than loss of goodwill and reputation to fulfil the condition of irreparable injury. In fact, if the first two prerequisites are fulfilled, in trade mark actions irreparable loss can be presumed to have taken place.
123. The expression "irreparable injury" in that sense would have established injury which the plaintiff is likely to suffer."
(Emphasis supplied)
34. At this stage, I would like to refer and rely upon the full bench decision of Honourable Apex Court in a case of Page 44 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined Renaissance Hotel Holdings Inc V/S B Vijaya Sai and Others reported in (2022) 5 SCC 1 wherein held as under:-
"[47] It could thus be seen that in all legal proceedings relating to trade mark registered under the said Act, the original registration of the trade mark and of all subsequent assignments and transmissions of the trade mark shall be prima facie evidence of the validity thereof.
[48] The legislative scheme is clear that when the mark of the defendant is identical with the registered trade mark of the plaintiff and the goods or services covered are similar to the ones covered by such registered trade mark, it may be necessary to prove that it is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark. Similarly, when the trade mark of the plaintiff is similar to the registered trade mark of the defendant and the goods or services covered by such registered trade mark are identical or similar to the goods or services covered by such registered trade mark, it may again be necessary to establish that it is likely to cause confusion on the part of the public. However, when the trade mark of the defendant is identical with the registered trade mark of the plaintiff and that the goods or services of the defendant are identical with the goods or services covered by registered trade mark, the Court shall presume that it is likely to cause confusion on the part of the public.
[49] Having considered the legislative scheme as has been elaborately provided in the said Act, it will be apposite to refer to the observations of this Court, while considering Section 21 of The Trade Marks Act, 1940 in the case of Kaviraj Pandit Durga Dutt Sharma (supra):
"28. The other ground of objection that the findings are inconsistent really proceeds on an error in appreciating the basic differences between the causes of action and right to relief in suits for passing off and for infringement of a registered trade mark and in equating the essentials of a passing off action with those in respect of an action complaining of an infringement of a registered trade Page 45 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined mark. We have already pointed out that the suit by the respondent complained both of an invasion of a statutory right under Section 21 in respect of a registered trade mark and also of a passing off by the use of the same mark. The finding in favour of the appellant to which the learned counsel drew our attention was based upon dissimilarity of the packing in which the goods of the two parties were vended, the difference in the physical appearance of the two packets by reason of the variation in the colour and other features and their general get-up together with the circumstance that the name and address of the manufactory of the appellant was prominently displayed on his packets and these features were all set out for negativing the respondent's claim that the appellant had passed off his goods as those of the respondent. These matters which are of the essence of the cause of action for relief on the ground of passing off play but a limited role in an action for infringement of a registered trade mark by the registered proprietor who has a statutory right to that mark and who has a statutory remedy for the event of the use by another of that mark or a colourable imitation thereof. While an action for passing off is a Common Law remedy being in substance an action for deceit, that is, a passing off by a person of his own goods as those of another, that is not the gist of an action for infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive right to the use of the trade mark in relation to those goods" (Vide Section 21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for infringement. No doubt, where the evidence in respect of passing off consists merely of the colourable use of a registered trade mark, the essential features of both the actions might coincide in the sense that what would be a colourable imitation of a trade mark in a passing off action would also be such in an action for infringement of the same trade mark. But there the correspondence between the two ceases. In an action for Page 46 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined infringement, the plaintiff must, no doubt, make out that the use of the defendant's mark is likely to deceive, but where the similarity between the plaintiff's and the defendant's mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is an imitation, no further evidence is required to establish that the plaintiff's rights are violated. Expressed in another way, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark would be immaterial; whereas in the case of passing off, the defendant may escape liability if he can show that the added matter is sufficient to distinguish his goods from those of the plaintiff."
[50] It could thus be seen that this Court has pointed out the distinction between the causes of action and right to relief in suits for passing off and for infringement of registered trade mark. It has been held that the essentials of a passing off action with those in respect of an action complaining of an infringement of a registered trade mark, cannot be equated. It has been held that though an action for passing off is a Common Law remedy being an action for deceit, that is, a passing off by a person of his own goods as those of another; the action for infringement is a statutory right conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive rights to the use of the trade mark in relation to those goods. The use by the defendant of the trade mark of the plaintiff is a sine qua non in the case of an action for infringement. It has further been held that if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark, would be immaterial in a case of infringement of the trade mark, whereas in the case of a passing off, the defendant may escape liability if he can show that the added matter is sufficient to Page 47 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined distinguish his goods from those of the plaintiff. [51] Again, while considering the provisions of Section 21 of the 1940 Act, this Court in the case of Ruston & Hornsby Limited (supra), observed thus:
"4. It very often happens that although the defendant is not using the trade mark 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 would be proved. It is on the contrary conceivable that although the defendant may be using the plaintiff's mark the get up of the defendant's goods may be so different from the get up of the plaintiff's goods and the prices also may by so different that there would be no probability of deception of the public. Nevertheless, in an action on the trade mark, that is to say, in an infringement action, an injunction would issue as soon as it is proved that the defendant is improperly using the plaintiff's mark.
5. The action for infringement is a statutory right. It is dependent upon the validity of the registration and subject to other restrictions laid down in Sections 30, 34 and 35 of the Act. On the other hand the gist of a passing off action is that A is not entitled to represent his goods as the goods of B but it is not necessary for B to prove that A did this knowingly or with any intent to deceive. It is enough that the get-up of B's goods has become distinctive of them and that there is a probability of confusion between them and the goods of A. No case of actual deception nor any actual damage need be proved. At common law the action was not maintainable unless there had been fraud on A's part. In equity, however, Lord Cottenham, L.C., in Millington v. Fox [3 My & Cr 338] held that it was immaterial whether the defendant had been fraudulent or not in using the plaintiff's trade mark and granted an injunction accordingly. The common law courts, however, adhered to their view that fraud was necessary until the Judicature Acts, by fusing law and equity, gave the equitable rule the victory over the common law rule.
6. The two actions, however, are closely similar in some respects. As was observed by the Master of Page 48 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the Rolls in Saville Perfumery Ltd. v. June Perfect Ltd. [58 RPC 147 at 161] :
"The statute law relating to infringement of trade marks is based on the same fundamental idea as the law relating to passing-off. But it differs from that law in two particulars, namely (1) it is concerned only with one method of passing-off, namely, the use of a trade mark, and (2) the statutory protection is absolute in the sense that once a mark is shown to offend, the user of it cannot escape by showing that by something outside the actual mark itself he has distinguished his goods from those of the registered proprietor. Accordingly, in considering the question of infringement the Courts have held, and it is now expressly provided by the Trade Marks Act, 1938, Section 4, that infringement takes place not merely by exact imitation but by the use of a mark so nearly resembling the registered mark as to be likely to deceive.""
[52] It could thus be seen that this Court again reiterated that the question to be asked in an infringement action is as to whether the defendant is using a mark which is same as, or which is a colourable imitation of the plaintiff's registered trade mark. It has further been held that though the get up of the defendant's goods may be so different from the plaintiff's goods and the prices may also be so different that there would be no probability of deception of the public, nevertheless even in such cases, i.e., in an infringement action, an injunction would be issued as soon as it is proved that the defendant is improperly using the plaintiff's mark. It has been reiterated that no case of actual deception nor any actual damage needs to be proved in such cases. This Court has further held that though two actions are closely similar in some respects, in an action for infringement, where the defendant's trade mark is identical with the plaintiff's trade mark, the Court will not enquire whether the infringement is such as is likely to deceive or cause confusion."
(Emphasis supplied)
35. It is also profitable to place reliance upon the decision of Page 49 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined Honourable Supreme Court of India in a case of Laxmikant V Patel V/S Chetanbhai Shah reported in (2002) 3 SCC 65 touch upon the issue of granting an injunction in the case of passing off held as under:-
"[8] It is common in the trade and business for a trader or a businessman to adopt a name and/or mark under which he would carry on his trade or business. According to Kerly {Law of Trade Marks and Trade Names, Twelfth Edition, Para 16.49), 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 plaintiff, 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 probability of confusion in business, an injunction will be granted even though the defendants adopted the name innocently.
[9] It will be useful to have a general view of certain statutory definitions as incorporated in the Trade Marks Act, 1999. The definition of trade mark is very wide and means, inter alia, a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others. Mark includes amongst other things name or word also. Name includes any abbreviation of a name.
[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 as associated with a person acquire a reputation or goodwill Page 50 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined 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 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 result in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury.
[11] Salmond & Heuston in Law of Torts (Twentieth Edition, at page 395) call this form of injury as 'injurious falsehood' and observe the same having been 'awkwardly termed' as 'passing off and state :-
"The legal and economic basis of this tort is to provide protection for the right of property which exists not in a particular name, mark or style but in an established business, commercial or professional reputation or goodwill. So to sell merchandise or carry on business under such a name, mark, description or otherwise in such a manner as to mislead the public into believing that the merchandise or business is that of another person is a wrong actionable at the suit of that other person. This form of injury is commonly, though awkwardly, termed that of passing off one's goods or business as the goods or business of another and is the most important example of the wrong of injurious falsehood. The gist of the conception of passing off is that the goods are in effect telling a falsehood about themselves, are saying something about themselves which is calculated to mislead. The law on this matter is designed to protect traders against that form of unfair competition which consists in acquiring for oneself, by means of false or misleading devices, the benefit of the reputation already achieved by rival traders."Page 51 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025
NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined [12] In Oertil v. Bowman, 1957 RPC 388, (at page 397):
1957 CLY 3549, the gist of passing off action was defined by stating that it was essential to the success of any claim to passing off based on the use of given mark or get-up that the plaintiff should be able to show that the disputed 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 of that mark or get-up will be understood by the trade and the public in that country as meaning that the goods are the plaintiff's goods. It is in the nature of acquisition of a quasi-proprietary right to the exclusive use of the mark or get-up has relation to his goods. Such right is invaded by anyone using the same or some 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 injunction granted by the Court would shape depends on the facts and circumstances of each case. Where a defendant has imitated or adopted that plaintiffs distinctive trade mark or business name, the order may be an absolute injunction Page 52 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined that he would not use or carry on business under that name. (Kerly, ibid, Para 16.97) [17] We are conscious of the law that this Court would not ordinarily interfere with the exercise of discretion in the matter of grant of temporary injunction by the High Court and the trial Court and substitute its own discretion therefore except where the discretion has been shown to have been exercised arbitrarily or capriciously or perversely or where the order of the Court under scrutiny ignores the settled principles of law regulating grant or refusal of interlocutory injunction. An appeal against exercise of discretion is said to be an appeal on principle. Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the Court below solely on the ground that if it had considered the matter at the trial stage, it would have come to a contrary conclusion. If the discretion has been exercised by the trial Court reasonably and in a judicial manner the fact that the appellate Court would have taken a different view may not justify interference with the trial Court's exercise of discretion {See Wander Ltd. v. Antox India P. Ltd., 1990 (Supp) SCC 727 :
1990(3) SCC 240 and N. R. Dongre v. Whirlpool Corporation, 1996 (5) SCC 714) : 1996 AIR SCW 3514 However, the present one is a case falling within the well accepted exceptions. Neither the trial Court nor the High Court have kept in view and applied their mind to the relevant settled principles of law governing the grant or refusal of interlocutory injunction in trade mark and trade name disputes. A refusal to grant an injunction in spite of the availability of facts, which are prima facie established by overwhelming evidence and material available on record justifying the grant thereof, occasion a failure of justice and such injury to the plaintiff as would not be capable of being undone at a latter stage. The discretion exercised by the trial Court and the High Court against the plaintiff, is neither reasonable nor judicious. The grant of interlocutory injunction to the plaintiff could not have been refused, therefore, it becomes obligatory on the part of this Court to interfere."
(Emphasis supplied)
36. Thus, this Court is of the view that the Trial Court has Page 53 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined completely gone in the wrong direction, thereby considering the status of the power of attorney holder as the defendant, and answered six issues, which were framed by itself but decided incorrectly, erroneously, and perversely, thereby committing a serious error of law, whereby refused the injunction in favour of the plaintiff, so granted during the pendency of the injunction application.
37. As such during course of arguments, it has been drawn attention of learned advocates appearing for Respondent- defendant about aforesaid facts and aspect of the matter whereby trial Court has committed a serious error not only in not appropriately considering the facts but it has also committed a gross error in law by unnoticed various provisions of both these Acts. Learned advocates of Respondent-defendant were unable to satisfy this Court thereby not in a position to defend the impugned judgement/order albeit, argued on the points which were either never pressed into service before trial Court or not satisfactorily recorded in the impugned Page 54 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined judgement/order. So, in light of said facts and ratio of aforesaid decisions applied to the case on hand, this Court is not at all impressed by any of the arguments so canvassed by learned advocates of Respondent-defendant and recorded herein above.
38. When the impugned order is erroneous, perverse, and not in consonance with the provisions of the law, this Court would be entitled to interfere with such an order by exercising its power under Order 43 of the CPC, which is otherwise required to be exercised to protect the right of the plaintiff as per the provisions of the Trademark Act, 1999 and the Copyright Act, 1957.
CONCLUSION
39. The upshot of the aforesaid discussion, observation, and findings, as recorded hereinabove, this Court is of the view that the order impugned in the appeal is erroneous, perverse, and without appreciating the material particulars available on record and passed in ignorance of the relevant provisions of Page 55 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the Trademark Act, 1999 and the Copyright Act, 1957, as discussed hereinabove.
40. Thus, in view of the aforesaid, the impugned order requires to be quashed and set aside, thereby the injunction application of the plaintiff filed below Exhibit 5 in Trademark Suit No. 1 of 2024 at Visnagar, Mehsana is held to be allowed as prayed for by the plaintiff, whereby, injunction so granted in favour of the plaintiff continued so far will continue till disposal of the suit.
41. Consequently, the applications filed by the defendant below Exhibits 11 and 16 in Trademark Suit No. 1 of 2024, pending before Visnagar at Mehsana are hereby rejected, subject to as follows.
42. Considering the fact that the goods, which were seized as per the order of the Trial Court passed below Exhibit 6 through the Court Commissioner are perishable goods, it is open for the defendant to move an appropriate application for the disposal of such goods albeit, without affecting the right of Page 56 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025 NEUTRAL CITATION C/AO/9/2025 CAV JUDGMENT DATED: 07/03/2025 undefined the plaintiff, thereby it can be permitted to sell such seized goods without using the brand name "ARJUN" on its selling pouches. The Trial Court may pass an appropriate order on such an application on appropriate condition, if so filed by the defendant, in accordance with the law.
43. In view of the above, the impugned order dated 30 th December 2024, passed by the 4th Additional District Judge, Mehsana at Visnagar, below Exhibits 5, 11, and 16 in Trademark Suit No. 1 of 2024, is hereby quashed and set aside, and the appeal from order is partly allowed to the aforesaid extent. No order as to costs. The civil application is also disposed of accordingly.
Sd/-
(MAULIK J.SHELAT,J) MOHD MONIS Page 57 of 57 Uploaded by MOHD MONIS(HC01900) on Fri Mar 07 2025 Downloaded on : Sat Mar 08 01:32:23 IST 2025