TMI Blog2007 (1) TMI 616X X X X Extracts X X X X X X X X Extracts X X X X ..... sole proprietor of the Appellant. It is claimed that Mr. Krishan Bansal adopted the trade mark 'Udta Panchhi' in March, 1982. 3. Learned trial Court by the impugned order dated 30th July, 2005 has allowed application of the Respondent under Order XXXIX, Rules 1 and 2 of the Code of Civil Procedure, 1908 (hereinafter referred to as the Code, for short) and restrained the Appellant from using the mark Panchhi . While doing so, learned trial Court has held that the Respondent being a prior user and a registered owner of the mark Panchhi is entitled to injunction against the Appellant notwithstanding the delay in approaching the Court and in filing the suit for permanent injunction. The Respondent filed the suit for permanent injunction against the Appellant in 1997. 4. Number of contentions have been raised by the Appellant and the Respondent. For proper appreciation, I have discussed these contentions under different heads. (A) Whether the marks 'Udta Panchhi' and 'Panchhi Chaap' are deceptively similar. 5. In a world where consumer has bewildering choices and options to purchase products, manufacturers and dealers have used marks to identify their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s decided whether the mark of the Defendant is likely to deceive or cause confusion'. In Amritdhara Pharmacy v. Satya Deo Gupta AIR 1963 SC 449 : PTC (Supp) (2) 1 (SC) Supreme Court referring to Kerly on Trade Marks, 8th Edn. Observed: For deceptive resemblance two important questions are: (1) who are the persons whom the resemblance must be likely to deceive or confuse, and (2) what rules of comparison are to be adopted in judging whether such resemblance exists. As to confusion, it is perhaps an appropriate description of the state of mind of a customer who, on seeing a mark thinks that it differs from the mark on goods which he has previously bought, but is doubtful whether that impression is not due to imperfect recollection. 9. Supreme Court also quoted Parker, J. in Pianotist Company Application, Re, as under- You must take the two words. You must Judge of them, both by their look and by their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... marks have to be considered as a whole. 12. Question of confusion cannot be decided by keeping the two marks by each other and noting similarities and differences between the two marks. Right in a trade mark is with reference to trade and commerce. Question of deception and confusion has to be examined and dealt with from commercial point of view. The law gives protection to the proprietor of the trade mark if there is likelihood of deception or confusion. The impression created by looking at the two marks and the significant feature and idea behind the two marks that would be formed in the mind of the purchaser is the relevant criteria. Similarity and affinity in sound is also an important criteria. Ocular comparison is not decisive. Sound test is important as customers ask for the goods by name. 13. Even when action for passing of under common law is initiated, the essential features of both the marks are taken into consideration to examine whether the alleged infringer is passing of his goods as that of the other and causing injury to goodwill and business of the other. 14. Chewing tobacco is used by illiterate and semi literate consumers. We have to examine the questio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is based upon a statutory right. Secondly, delay by itself was not material unless there was acquiescence or consent. Lastly, the Appellant was guilty of deceitful and dishonest initial adoption or fraud and, therefore, not withstanding allegation of acquiescence, injunction must follow. 20. The Appellant, on the other hand, submitted that delay and laches was an important factor, when an owner of trade mark allows and permits third parties to market and sell their products under a similar trade mark. In these circumstances principles of acquiescence apply. Reference was made to doctrine of reverse confusion. It was pointed out that the sales of the Appellant were much more than the sales of the Respondent. 21. Whether delay or laches can non-suit, a proprietor of a trade mark or dis-entitle him from claiming interim injunction or injunction, has been subject matter of controversy and discussion in several decided cases. These judgments may now be noticed. 22. this Court in the case of Fair Deal Corporation (P) Ltd. v. Vijay Pharmaceuticals 1985 (5) PTC 80 (Del), vacated the interim injunction granted in favour of the Plaintiff, after holding that by conduct the Plaintiff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy for passing off action cannot be defeated by delay or inaction itself. In the said case, the Court also found that a number of other parties had been using the trade mark standard with suffix and pre-fix in relation to electrical, allied or cognate goods but that had not caused any confusion and deception in the minds of the consumers/traders and, therefore, prima facie it was held that the marks were not similar and identical so as to cause deception. 24. In the case of Shri Gopal Engineering (supra), Jaspal Singh, J. invoked the doctrine vigilantivus non dormientibus suppetit (If you want law to help, you must keep awake) to deny interim relief of injunction. However, the Court noticed decision of this Court in Hindustan Pencils Private Limited v. India Stationery Products Company AIR 1990 Delhi 19 : 1989 (9) PTC 61 (Del), and held that in the said case the use of the mark was fraudulent and on coming to know of infringement the Plaintiff therein had filed an application for cancellation of the registration of the copyright. It was held that the Defendant's adoption of the mark in Shri Gopal case was honest and concurrent and there was nothing to show that the presenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for nearly three decades and, therefore, balance of convenience was not in favour of granting injunction, as the party seeking injunction had remained quiet and allowed the other side to expand and develop its business. Asking the Defendant after three decades of hard work to change and adopt a different mark would have caused a serious hardship. 28. In the Power Control Appliances v. Sumeet Machines Private Limited (1994) 2 SCC 448 : 1995 (15) PTC 165 (SC), the plea taken by the second user was that of an implied consent or at least waiver. It was stated that the registered owner had disentitled himself from grant of equitable relief by reason of unexplained delay and suppression of facts. It was also stated that the balance of convenience was in favour of the second user. The Supreme Court referred to Section 30(1)(b) of the Act and held that acquiescence was one of the defences available. Acquiescence it was held was standing by, when another person was evading the proprietor's rights and was spending money on his trade mark. Acquiescence was course of conduct inconsistent with claim for exclusive rights on a trade mark. It implied positive act and not merely silence or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cases where a mark has become public juric Reference was also made to Electrolux v. Electrix 71 RPC 23 wherein five different pre-requisites for establishing acquiescence in the nature of fraud were required to be considered and satisfied before relief of injunction could be denied to the proprietor. The Court, however, noticed that the question of acquiescence and laches was a grey area and sometimes Courts had refused to grant interim injunction on the said ground, though it cannot be a valid ground to deny relief of permanent injunction. This distinction between interim injunction and permanent injunction did not find favour with the Court. 31. Distinction was also made in a case of a fraudulent infringer, who has knowingly and deliberately violated the rights of the proprietor. A person who had deliberately infringed upon another's mark, it was held, cannot complain and hide behind defence of delay laches or acquiescence, as the infringement at the very initial stage itself was fraudulent. Delay and laches by itself would not bestow, fraud with character of legality. Reference was also made to Mc CARTHY on Trade Marks wherein it was observed that the Court must also t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch adoption of the mark by the party was not an honest one. The Court would be justified in concluding that the Defendant, in such an action, wanted to cash in on the Plaintiffs name and reputation and that was the sole, primary or the real motive of the Defendant adopting such a mark. Even if, in such a case, there may be an inordinate delay on the part of the Plaintiff in bringing a suit for injunction, the application of the Plaintiff for an interim injunction cannot be dismissed on the ground that the Defendant has been using the mark for a number of years Dealing with this aspect Harry D. Nims in his The Law of Unfair Competition and Trade-Marks . Fourth Edition, Volume Two at page 1282 noted as follows: Where infringement is deliberate and willful and the Defendant acts fraudulently with knowledge that he is violating Plaintiffs rights, essential elements of estoppel are lacking and in such a case the protection of Plaintiffs rights by injunctive relief never is properly denied. The doctrine of estoppel can only be invoked to promote fair dealings. 32. It would appear to me that where there is an honest concurrent user by the Defendant then inordinate delay or laches ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dimani AIR 1986 Del 329 : 1986 (6) PTC 17 (Del), and held that injunction cannot be denied on the ground of delay. However, I may a mention here that in the said case, the considerations that weighed with the Court was that no explanation was given by the infringer as to how they came to adopt the trade mark Revlon. It was held that the adoption of the said trade mark was not honest and, therefore, delay and laches were not a good ground to deny relief. Similarly, in the case of Novartis AG v. Wanbury Limited and Anr. 2005 (31) PTC 75 (Del.) it was held where adoption of the mark itself was dishonest and fraudulent, mere delay in bringing action for infringement for trade mark was not a ground to deny injunction and to non-suit the proprietor if otherwise his claim was genuine. Difference was made between mere negligence and acquiescence. The Court also referred to the importance of honesty of user by the alleged infringer. The second user was required to show circumstances leading to adoption of the trade mark at the first instance. 34. Recently, Supreme Court again examined this issue in Ramdev Food Products Private Limited v. Arvind Bhai Ram Bhai Patel (2006) 8 SCC 736. It wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and not merely standing by and absence of objection. Affirmative acceptance can be in writing and can be termed as express consent. Implied consent can be oral and by conduct. The conduct, however, must indicate acceptance and not mere inaction or inactivity. Inaction in every case without anything more does not lead to an inference of implied consent. However where the Plaintiff has laid by and inspite of his right by his conduct has encouraged the Defendant to alter his condition and the latter has acted upon this faith of encouragement so held out, the Plaintiff loses his claim to claim injunction. This is clear from the decision of the Supreme Court in the case of Sumeet Machines (supra) which has been quoted with approval in the case of Ramdev Foods (supra). (See also P. John Chandy and Company (P) Ltd. v. John P. Thomas (2002) 5 SCC 90). Where there is consent, action for infringement must fail. Consent whether implied or express is a complete defence to action for infringement. 39. When infringement action is initiated on the basis of a registered mark and prayer for interim injunction is made, Court will on the basis of common law principles decide the application for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not tilt the balance of convenience in favour of a third party. If the initial adoption itself is dishonest, injunction must follow. Fraud or illegal adoption does not become valid and legal. Honesty in adoption must, therefore, be established and proved by the Defendant. 43. While examining the question of balance of convenience, Court is required to take into consideration public interest i.e. interest of the buyers and the consumers. If public interest is affected, delay is of no consequence. 44. In view of the entire case law discussed above, the following principles of law emerge: (i) Mere delay is not sufficient to defeat grant of injunction in cases of infringement of trade mark. Delay is not a bar to enforce and claim a legal right. (ii) Consent in addition to other statutory defences is a complete defence to action for infringement. (iii) Consent may be expressed or implied but inaction in every case without anything more does not lead to an inference of implied consent. Implied consent means conduct inconsistent with claim of exclusive right over the trade mark, trade name etc. Implied consent implies standing by or allowing the Defendant to invade rights a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a different proprietor in respect of the same goods or description of goods. (2) Where separate applications are made by different persons to be registered as proprietors respectively of trade marks which are identical or nearly resemble each other in respect of the same goods or description of goods, the Registrar may defer the acceptance of the application or applications bearing a later date until after the determination of the proceedings in respect of the earlier application, and may dispose of such application or applications in the light of the evidence tendered in relation to earlier application and the oppositions thereto, if any. (3) In case of honest concurrent use or of other special circumstances which, in the opinion of the Registrar, make it proper so to do, he may permit the registration by more than one proprietor of trade marks which are identical or nearly resemble each other (whether any such trade mark is already registered or not) in respect of the same goods or description of goods subject to such conditions and limitations, if any as the Registrar may think fit to impose. 47. Sub-section (1) of the said Section states that no trade mark in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistration was made were also dismissed. 50. Section 28 of the Act confers certain rights on a proprietor of the registered trade mark like the Respondent. The said proprietor has exclusive right to use the trade mark in relation to the goods in respect of which trade mark is registered and obtain relief in respect of infringement. Section 29 provides for consequences on infringement of the trade mark. Section 30 of the Act is a non-obstante clause and stipulates that the acts which do not constitute infringement of a right to use the registered trade mark. Section 30(1)(b) of the Act provides that expressed or implied consent to use a trade mark by a third person does not amount to infringement. Section 30 does not use the expression 'honest and concurrent user'. However, Courts have allowed Defendants to set up defence on the basis of honest and concurrent user. 51. In the present matter, the Appellant had made an application for registration of trade mark Udta Panchhi through it's predecessor in interest Mr. Krishan Bansal, then trading as sole proprietor of Bansal Tobacco Store . This application was opposed by the Respondent. The Registrar of trade marks v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nchhi in 1982 and had moved an application for registration in 1990. Admittedly, therefore, the Respondent is a prior user. As per figures placed on record by the Respondent between a the period 1973-74 he had sales under the trade mark/label Panchhi Chaap varying between ₹ 1,43,950 to ₹ 5,71,690 per annum. The sale figures are substantial keeping in view the purchasing power and value of Rupee during this period. Prima facie, it appears that the Appellant was aware and had knowledge about the trade mark Panchhi Chaap , when he adopted the trade mark Udta Panchhi in 1982 in respect of chewing tobacco manufactured by him. Admittedly, in the initial years from 1982 till 31st March, 1985, the sales of the Appellant's predecessor varied between ₹ 2,452 to ₹ 24,735 only. Pricing of the products is also virtually same and the users are common. No doubt get-up, colours etc. of the wrapper of the Appellant was/is different from that of the Respondent but the word panchhi is common and the word panchhi with drawing of a flying bird is the most distinct and essential feature in both the wrappers. Chewing tobacco as already stated above is used by semi ed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 34 of the Trade Marks Act, 1999, it was submitted that no case for infringement is made out against the Appellant except for Registration No. 297415. With regard to the said registration it was submitted that distinctive label as a whole was registered and the said registration would not give any exclusive right to the Respondent in respect of particular word or name mentioned in the label. Reliance was placed upon Registrar of Companies v. Ashok Chandra, 1955 (2) SCR 252. It was further submitted that though in some cases test of essential features has been prescribed but those decisions relate to cases in which words have been registered and not the entire label. Reliance was also placed upon Section 17 of the Trade Marks Act, 1999. 57. This question need not detain me in view of the recent decision of the Supreme Court in the case of Ramdev Food Products (supra). The Supreme Court referred to Sections 15 and 17 of the Act and held that deception could be in respect of any prominent feature of the registered trade mark. While referring to Ashok Chandra's case (supra), Supreme Court noticed that the word 'shree' was not regarded as an important feature of the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... constitution of a partnership firm and dissolution Initially, the Respondent-partnership firm consisted of the father and his three sons. Father and one son died but two other sons have continued as partners of the firm Shiva Tobacco Company without any objection and hindrance from any legal representative of the partners who have expired. There is nothing on record to show that the partnership firm-Shiva Tobacco Company consisting of two brothers is not the registered owner of the mark containing the word Panchhi Chhap registered in 1974. Intellectual /Property Appellate Board in its order dated 16th November, 2006 has accepted the plea of the Respondent in this regard. Prima facie on the basis of documents and pleading of the parties it cannot be said that the Respondent-Shiva Tobacco Company is not the owner of the registered trademark. (F) Merits and prima facie facts 60. I have already referred to my prima facie finding on the question of initial adoption by the Appellant of the mark Panchhi and held that the same is not honest. With these findings, it cannot be said that in equity the Respondent is not entitled to any relief of injunction. 61. Matter has also to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in favour of the Appellant. The Respondent challenged the said direction by filing Civil Miscellaneous Main Petition in the Delhi High Court against the registration granted in favour of the Appellant and operation of the order passed by the Registrar was stayed. The explanation given by the Respondent is that from 1990 onwards parties have been in litigation relating to the mark panchhi . The Appellant had succeeded in getting registration in his favour in 1993 by relying upon Section 12(3) of the Act. In these circumstances the Respondent could not have filed a suit for infringement against a registered owner. Therefore, there is no question of acquiescence on the part of the Respondent. The Respondent was not keeping quiet but contesting the claim of the Appellant. (I) am not going into the question whether acquiescence should be positive). In the present case, the Respondent had protested and objected to registration of the trade mark including the name panchhi with the flying bird. In 1993 the matter was decided in favour of the Appellant, though operation of the order was stayed by the High Court by an interim order. However, the Respondent has explained that an gettin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as also argued that the Respondent has given wrong date, March, 1997, relating to cause of action as the Respondent was aware that the mark Udta Panchhi was being used since 1990. Reliance was placed upon several decisions in which it has been held that a person who conceals or makes misrepresentation in the plaint, is not entitled to discretionary relief of injunction. 68. There cannot be any quarrel with the above proposition. However, the question is whether the Respondent is guilty of concealment of facts and/or has made any misrepresentation. The Respondent has submitted that he was not aware of any association between Ansul Industries and Bansal Tobacco Store and, therefore, the facts relating to claim of Bansal Tobacco Store and the proceeding between the two were not mentioned in the plaint. It was also stated that change in name from Bansali Tobacco Store to Ansul Industries was not informed to the, Registrar of Trademarks. 69. Prima facie, I find merit in the submission made by the Respondent. One of the reasons for this prima facie finding is that the Respondent has not gained anything by concealling facts relating to claim made by Bansal Tobacco Store in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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