Nrb Bearings Limited vs Nrb Industrial Bearings Limited
- Court
- Bombay High Court
CNR No : HCBM020354252026
carbpl-35424-26+Jud.doc
Sayali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
COMM ARBITRATION PETITION (L) NO.35424 OF 2026
NRB Bearings Limited
… Petitioner
Vs.
NRB Industrial Bearings Limited
… Respondent
SAYALI
DEEPAK
UPASANI
Dr. Virendra Tulzapurkar, Sr. Advocate with Mr. Ravi
Kadam, Mr. Rohan Kadam, Mr. Rajendra Barot, Mr.
Anand Shah, Mr. Cheryl Fernandes, Mr. Akilesh
Menezes i/b AZB & Partners, for the Petitioner.
Digitally signed
by SAYALI
DEEPAK
UPASANI
Date: 2026.11.04
13:47:57 +0530
Mr. Mustafa Doctor, Sr. Advocate with Mr. Gautam
Mehta, Mr.Chakrapani Misra, Mr. Sameer Bindra, Ms.
Ananya Misra, Mr. Vedant Thakur, Mr. Yash Bhagwat
i/b Khaitan & Co., for the Respondent.
CORAM : AMIT BORKAR, J.
RESERVED ON : OCTOBER 30, 2026.
PRONOUNCED ON : NOVEMBER 4, 2026
JUDGMENT:
1. The Petitioner has filed the present Petition under Section 9
of the Arbitration and Conciliation Act, 1996, seeking interim
reliefs in a dispute arising out of the Inter-Company Agreement
dated 20 January 2025, entered into between the Petitioner and
the Respondent. The dispute is mainly about the Respondent using
the trademarks which exclusively belong to the Petitioner, without
any authority and contrary to the terms agreed between the
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parties. The Petitioner contends that such use is contrary to the
Scheme of Arrangement entered into between the parties, which
was approved by this Court by an order dated 24 August 2012.
2. The facts which have led to the filing of the present Petition
are as follows. NRB Bearings Limited (for short, "NRB") was
incorporated in the year 1965. Since its incorporation, NRB has
been using the trademark "NRB". From the year 1965 onwards,
NRB has registered about 36 trademarks in its name, the earliest
application having been made in the year 1965. On 24 August
2012, this Court passed an order approving the Scheme of
Arrangement (for short, "Scheme") between NRB and NRB
Industrial Bearings Limited (for short, "NIBL"), in Company
Scheme Petition Nos. 187 and 188 of 2012 (for short, "Demerger
Order"). Under the Scheme, the Industrial Bearings Undertaking of
NRB was separated and transferred to NIBL. NRB was described as
the Demerged Company and NIBL as the Resulting Company. The
Scheme contained certain important conditions regarding the use
of trademarks. Clause 1.5.5(c) provided that the trademark "NRB
Industrial", relating to bearings used for industrial purposes, would
form part of the Industrial Bearings Undertaking transferred to
NIBL. However, it was made clear that "the trade mark 'NRB' and
associated description, design, colour and logo are exclusive
property of NRB, and NIBL shall not be entitled to use (except as
provided herein), similar description, design, colour and logo for
its business." Thus, even after the demerger, the trademark "NRB"
and its associated features continued to remain the exclusive
property of NRB. Clause 16.2 of the Scheme provided that NRB
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and NIBL would enter into suitable non-compete arrangements on
mutually agreed terms. In pursuance of Clause 16 of the Scheme,
NRB and NIBL entered into an Agreement on 31 October 2012 (for
short, "2012 Agreement"), which was made effective from 01
October 2012. Under Clause 1.1 of this Agreement, the business
activities of the two companies were separately divided. Clause
1.1.1 provided that NRB would carry on the business of bearings
used in all types of moving vehicles, including agricultural
equipment. NRB was permitted to carry on business in certain
bearings used for non-moving applications, as mentioned in
Annexure 1 to the 2012 Agreement. This was described as the
"business of bearings for mobile vehicles". On the other hand,
under Clause 1.1.2, NIBL was permitted to carry on the business of
industrial bearings, meaning bearings other than those falling
within the business of bearings for mobile vehicles. The Agreement
contained a restriction on the parties from entering into each
other's business. Under Clause 3, NRB, its subsidiaries and joint
venture companies were not permitted to carry on the business of
industrial bearings. Similarly, NIBL, its subsidiaries and joint
venture companies were not permitted to carry on the business of
bearings for mobile vehicles. This restriction was to remain in force
for six years from 01 October 2012 and, therefore, came to an end
on 30 September 2018. The parties had agreed upon certain
conditions regarding common products and part numbers, which
could be used both in mobile vehicles and for industrial purposes.
3. On 13 March 2015, NRB, through its Managing Director,
addressed a letter to NIBL complaining that NIBL was using the
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trademark "NRB" independently on its industrial bearing products
without authority. According to NRB, such use was contrary to
Clause 1.5.5(c) of the Scheme. NRB called upon NIBL to
immediately stop using the word "NRB" independently and to
recall and re-mark all products by using either "NIBL" or the
complete expression "NRB INDUSTRIAL". NRB called upon NIBL to
give written confirmation that it had stopped using "NRB"
independently. On 27 March 2015, NIBL replied to the said notice.
In its reply, NIBL accepted that the trademark "NRB" belonged to
NRB Bearings Limited. NIBL stated that the cylindrical roller
bearings manufactured by it were marked as "NRB Industrial". It
explained that the products bearing the marking "NRB" were
finished goods which had been transferred to it at the time of
demerger. NIBL requested NRB to provide details so that the
matter could be examined. On 31 March 2015, NRB again
addressed a letter to NIBL in response to its reply dated 27 March
2015. NRB clarified that all products manufactured or supplied by
NIBL were required to carry either the mark "NIBL" or the
complete expression "NRB Industrial", with proper spacing
between the words. This requirement was not restricted only to
cylindrical roller bearings. NRB pointed out that NIBL was
continuing to supply bearings with an incorrect marking, namely
"NRB Indl", instead of using the complete and proper expression.
NRB therefore called upon NIBL to recall all such products and re-
mark them with "NIBL" or "NRB Industrial" in full within seven
days. Thereafter, on 29 April 2016, NIBL filed four applications for
registration of the trademark "NRB INDUSTRIAL (label)" in black
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and white. Application No. 3246831 was filed in Class 12 for
"Bearings for motor vehicles; automotive bearings", with the
claimed date of first use being 06 October 2012. This application is
relevant because Class 12 relates to automotive bearings.
According to the Petitioner, NIBL had no earlier business in the
automotive bearing field. It is contended that filing such an
application was contrary to the non-compete arrangement under
the 2012 Agreement, which was still in force at that time and
continued until 30 September 2018.
4. On 02 October 2017, the trademark application filed by the
Respondent was advertised under Section 20 of the Trade Marks
Act. Thereafter, on 21 February 2018, the Respondent's trademark
application was granted registration with effect from 29 April
2016. On or about 30 September 2018, the six-year restriction on
carrying on each other's business, as provided under Clause 3 of
the 2012 Agreement, came to an end. During the years 2023 and
2024, the families of HSZ and DSS decided to enter into a family
settlement and a Memorandum of Understanding, along with the
Inter-Company Agreement of 2025, which is referred to hereafter.
Negotiations regarding the terms of the proposed Inter-Company
Agreement were carried on for a considerable period between the
members of both families and their respective advocates. At that
stage, the proposed Agreement was referred to as a "Letter
Agreement". Between 15 February 2024 and 29 March 2024, the
parties exchanged at least ten emails regarding the draft
Agreement and its terms. According to the Petitioner, these email
exchanges show that it wanted to include a specific condition
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relating to the trademark registered under Class 12. The proposed
condition provided that DSS would ensure that NIBL stopped
using, displaying, advertising or obtaining business under
trademark registration No. 3246831 in relation to bearings for
motor vehicles and automotive bearings, which formed part of
NRB's business. DSS was required to ensure that NIBL cancelled
the said Class 12 trademark registration and withdrew any
pending trademark or copyright applications relating to the same.
It was proposed that NIBL would provide copies of the cancellation
application and withdrawal letter, duly acknowledged by the
concerned Trademark Registry or Copyright Office.
5. The email exchanges show that the Respondent objected to
the aforesaid proposed condition and deleted it from the draft
Agreement. On 29 March 2024, the Petitioner's advocate
forwarded a draft Agreement which retained the deletion made by
the Respondent. Thus, the proposed condition relating to
cancellation of the Class 12 trademark registration was not
included in the final Agreement. Thereafter, on 20 January 2025,
NRB and NIBL entered into the Inter-Company Agreement (for
short, "ICA 2025"). The Agreement dealt with several issues,
including the use of trademarks and the rights relating to the
Dhannur Premises.
6. The families of HSZ and DSS entered into a Non-Solicit and
Brand Usage Agreement, which contained similar conditions
relating to the use of trademarks, non-solicitation and protection
of the brand. However, the condition proposed by the Petitioner
regarding the Class 12 trademark registration was not included in
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the final ICA 2025. Thereafter, on 17 July 2026, NIBL organised a
launch event for its new automotive bearing products. According
to the Petitioner, these products were introduced in the market
under the mark "NRB Industrial", contrary to ICA 2025 read with
the Scheme. The Petitioner points out that the last slide of the
presentation displayed the words "NRB INDUSTRIAL BEARINGS
LIMITED | NRB GROUP" against a blue background. According to
the Petitioner, blue colour has been associated with the NRB brand
for a long time. The Petitioner contends that displaying the words
"NRB GROUP" in this manner was contrary to Clause 7.1 of ICA
2025, which prohibited NIBL from representing as a part of the
NRB Group.
7. On 18 July 2026, NRB, through its advocates, Aditya
Associates, issued a Cease and Desist Notice to NIBL and its
directors, alleging several breaches of ICA 2025 and the Scheme.
NRB called upon NIBL to stop these activities and comply with the
conditions of the Agreement. However, no substantive reply was
received from NIBL. On 03 September 2026, NIBL sent a holding
reply to NRB in response to the Cease and Desist Notice.
8. On 16 September 2026, NIBL and DSS issued a notice to
NRB and HSZ, alleging breaches of the Memorandum Recording
Family Settlement dated 20 January 2025 (for short, "MFS"), the
Letter for Withdrawal of Litigation dated 20 January 2025 (for
short, "Withdrawal Letter") and ICA 2025. In response to the
allegation regarding withdrawal of the suit, NRB filed a praecipe
on 17 September 2026, when LEC Suit No. 17 of 2025 was listed
before the Court, requesting withdrawal of the suit. However, the
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Court did not hold its sitting on that day. Therefore, the matter
was simply adjourned, and the suit could not be formally
withdrawn.
9. On 28 September 2026, NRB sent a holding reply to NIBL,
limited to the allegations regarding breach of ICA 2025.
Thereafter, on 29 September 2026, NRB sent a separate reply
dealing with the allegations concerning breach of the MFS and the
Withdrawal Letter. In that reply, NRB denied the allegations made
against it. Subsequently, on 08 and 09 October 2026, NRB
purchased certain automotive bearing products of NIBL from the
open market. According to NRB, these products were being sold in
violation of the conditions of ICA 2025 and the Scheme. It is in
these circumstances, and on the basis of the aforesaid alleged
breaches, that the Petitioner has approached this Court by filing
the present Petition under Section 9 of the Arbitration and
Conciliation Act, 1996, seeking interim protection.
10. Dr. Virendra Tulzapurkar, learned Senior Advocate appearing
for the Petitioner, submitted that the present Petition has been filed
under Section 9 of the Arbitration and Conciliation Act, 1996,
seeking interim reliefs pending arbitration proceedings against the
Respondent. The Respondent was earlier a subsidiary of the
Petitioner. The dispute arises out of the Inter-Company
Agreement . He submitted that under the Scheme of Arrangement,
which was approved by this Court by the Demerger Order dated 24
August 2012, read with the Inter-Company Agreement, the
Respondent was permitted to use the trademarks "NRB Industrial"
and/or "NRB Industrial Bearings" only in respect of bearings meant
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for industrial purposes. Even such use was subject to strict
conditions regarding the colour, design, appearance, logo and
other features of the trademarks, as mentioned in the Inter-
Company Agreement. The Respondent had agreed that it would
not represent as being a part of or connected with the Petitioner or
the NRB Group. It had agreed to remove the word "NRB" from the
name of its company, namely, "NRB IBC Bearings Pvt. Ltd.", within
six months from the date of the Inter-Company Agreement, that is,
before 20 July 2025. The Respondent was prohibited from using
the word "NRB" independently or along with any other word
except "Industrial" or "Industrial Bearings". It could not use any
mark which was identical or deceptively similar to the Petitioner's
"NRB" trademarks or logo. Thus, according to the Petitioner, the
Respondent's right to use the word "NRB" was limited only to the
two expressions "NRB Industrial" and "NRB Industrial Bearings".
Even these expressions could be used only for industrial bearings
and subject to all the restrictions contained in the Inter-Company
Agreement. Dr. Tulzapurkar submitted that the Respondent was
required to stop using the address of the Dhannur premises as its
registered office or official address. It was not permitted to use
that address in its correspondence or communications or to refer
to it on its website, social media platforms or any other public
communication. The Petitioner had paid the Respondent a
substantial amount of Rs.55.12 Crores for accepting and
complying with these conditions. However, according to the
Petitioner, the Respondent has deliberately violated these
commitments.
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11. Dr. Tulzapurkar submitted that the Respondent had
committed several breaches of the Inter-Company Agreement.
Firstly, the Respondent organised a launch event during which it
displayed the words "NRB Industrial Bearings Limited NRB Group"
in blue colour. According to the Petitioner, the use of the words
"NRB Group" created a false impression that the Respondent
continued to be connected with the Petitioner. The blue colour
used in the presentation was associated with the Petitioner's
products and brand identity. Secondly, the Respondent had started
manufacturing and selling automotive bearings under the mark
and logo "NRB Industrial", although it was not permitted to use
that mark for such products. Dr. Tulzapurkar submitted that these
acts, along with the other breaches of the Agreement, showed that
the Respondent was trying to take advantage of the goodwill and
reputation built by the Petitioner under the "NRB" trademarks. The
Respondent was thereby interfering with the Petitioner's ownership
and rights in those trademarks. He submitted that the Petitioner
was therefore entitled to injunctive reliefs. The Petitioner has been
continuously using the "NRB" trademarks for more than 61 years
and has built a substantial business under those marks. Over the
years, it has become a well-known manufacturer of high-precision
friction solutions and precision-engineered bearing technologies
for the automobile and industrial sectors. Its business under the
"NRB" marks is carried on in several countries through its
subsidiaries and group companies, including Thailand, the United
States and Europe. The Petitioner has modern manufacturing
facilities in India and Thailand and has a business presence in
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more than 45 countries. A list showing the Petitioner's business
presence through its subsidiaries, group companies and affiliates is
set out below.
12. Dr. Tulzapurkar submitted that, apart from using the "NRB"
trademarks, the Petitioner had adopted a blue colour scheme and a
particular style and appearance for the boxes and cartons in which
its bearings are sold. This packaging and appearance had been
adopted before 1995. Since then, the Petitioner has continuously
and openly used the same along with the "NRB" trademarks for
bearings meant for automobiles and other automobile-related
applications. According to the Petitioner, this blue colour scheme
and packaging have become associated with its products.
Photographs showing the said colour scheme and packaging are
set out below.
13. Dr. Tulzapurkar submitted that the Petitioner manufactures,
markets and sells several types of bearings and automobile-related
products under the "NRB" trademarks and the blue colour
packaging and get-up. These products are supplied through a wide
network of dealers and distributors in India and other countries.
The Petitioner is particularly known for manufacturing bearings
used in automobiles and automobile-related applications. In India
alone, it has more than 140 dealers and distributors. It has
agencies and distributors in foreign countries who market and sell
its products to customers. A list of some of the products sold by the
Petitioner under the NRB brand is set out below. The list of its
distributors is set out below.
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14. Dr. Tulzapurkar submitted that in or around the beginning of
2012, the Petitioner filed Company Scheme Petition Nos. 187 and
188 of 2012 before this Court, seeking approval of a Scheme of
Arrangement (for short, "Scheme"). The purpose of the Scheme
was to separate the Industrial Bearings Undertaking of the
Petitioner and transfer the same to the Respondent, which was
then a subsidiary of the Petitioner. This Court approved and
sanctioned the Scheme by an order dated 24 August 2012, which
is referred to as the "Demerger Order". According to Dr.
Tulzapurkar, a combined reading of the relevant provisions of the
Scheme makes the position between the parties clear. The Scheme
provided for transfer of only a particular part of the Petitioner's
business, namely, the industrial bearings business. The entire
bearing business of the Petitioner was not transferred to the
Respondent. The business relating to bearings for mobile vehicles
of every description, including farm equipment, was kept with the
Petitioner, along with the goodwill and reputation attached to that
business. Therefore, only those assets and liabilities which formed
part of the defined Industrial Bearings Undertaking were
transferred to the Respondent. He submitted that the Scheme
made a clear distinction even in respect of the intellectual property
rights. The Respondent was permitted to use the expression "NRB
Industrial", but only in relation to bearings for industrial
applications. No right was given to it to use this mark for any other
purpose, particularly for bearings used in "mobile vehicles of every
description, including farm equipment". On the other hand, the
Scheme declared that the basic "NRB" trademark, along with its
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associated description, design, colour and logo, would continue to
remain the exclusive property of the Petitioner. The Respondent
was prohibited from using any similar description, design, colour
or logo for its business. Thus, according to the Petitioner, the
Scheme did not transfer the general goodwill or reputation
attached to the "NRB" trademarks to the Respondent. More
particularly, no such goodwill or reputation relating to bearings for
mobile vehicles of every description, including farm equipment,
was transferred. The Respondent was permitted to use "NRB
Industrial" only for manufacturing, marketing and selling bearings
for industrial purposes and for no other purpose.
15. Dr. Tulzapurkar submitted that the Scheme, when read with
the 2012 Agreement, shows the understanding reached between
the parties. Under this arrangement, the Petitioner retained the
business of bearings for mobile vehicles of every description,
including farm equipment, as well as the particular non-mobile
applications mentioned in Annexure 1 to the 2012 Agreement. The
Respondent took over the remaining business relating to industrial
bearings. For a period of six years, the Petitioner agreed not to
manufacture, market, sell or distribute industrial bearings.
Similarly, the Respondent agreed not to manufacture, market, sell
or distribute bearings for mobile vehicles. After the expiry of this
six-year period, both companies became free to manufacture,
market and sell bearings of every description. However, according
to Dr. Tulzapurkar, this relaxation of the non-compete restriction
did not change the separate conditions relating to trademarks
under the Scheme. Clause 1.5.5(c) of the Scheme permitted the
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Respondent to use "NRB Industrial" only for bearings meant for
industrial applications. The basic "NRB" trademark, together with
its associated description, design, colour and logo, continued to
remain the property of the Petitioner. Therefore, even though the
Respondent became free to enter the automobile bearing business
after the expiry of six years, it did not thereby acquire any right to
sell automobile bearings under the trademark "NRB Industrial" or
under any other mark in which "NRB" was the main, prominent
and essential feature.
16. Dr. Tulzapurkar submitted that the six-year restriction under
the 2012 Agreement came to an end on or about 30 September
2018. After that date, both parties became free to carry on the
business of manufacturing and selling bearings of any description.
However, the Respondent did not acquire any ownership or
additional right in the trademark "NRB Industrial" for bearings
used in mobile vehicles, including farm equipment. Its right to use
that trademark continued to be limited to bearings for industrial
applications under the Scheme. Thus, the expiry of the non-
compete period did not increase or extend the trademark rights
granted to the Respondent. Thereafter, on 20 January 2025, the
Petitioner and the Respondent entered into the Inter-Company
Agreement, which dealt, amongst other things, with the use of
trademarks and the Dhannur office premises. According to Dr.
Tulzapurkar, the Agreement was entered into to make the
respective rights of the parties regarding the NRB trademarks clear
and to avoid disputes. Its object was to define the limits within
which the Respondent could use the "NRB" trademarks and to
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prevent it from taking advantage of the goodwill, reputation and
ownership rights of the Petitioner in those trademarks.
17. Dr. Tulzapurkar then invited my attention to the various
clauses of the Inter-Company Agreement and submitted that they
record the understanding and obligations accepted by the parties.
The relevant clauses are as follows.
(a) Clause 3 deals with the consideration payable under
the Agreement. The Petitioner agreed to pay the Respondent
an amount of Rs.55.12 Crores, after deduction of applicable
taxes, along with GST, if payable. This amount was agreed to
be in full and final settlement of the disputes between the
parties relating to the trademarks and the Dhannur premises.
(b) Clause 4.1 deals with the limited right of the
Respondent to use the expressions "NRB Industrial" and
"NRB Industrial Bearings" and the manner in which these
expressions could be used. Under this clause, the Respondent
agreed that it could continue to use these marks only in
accordance with the Demerger Order, that is, only for
bearings meant for industrial applications. Further, the use of
these marks was required to follow the particular colour
combination, style, font and pattern shown in Schedule 1 to
the Inter-Company Agreement. The Respondent could
alternatively use the specified Pantone Scarlet and Pantone
Russet Brown colours. It was not permitted to use the word
"NRB" in any other colour, including black and white. Black
and white use was permitted only where the nature of the
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advertising medium did not allow the use of colour, such as a
black and white newspaper.
(c) Clause 4.2 provides that all trademark applications and
registrations of the Respondent, and its use of the marks,
must comply with the restrictions contained in the Inter-
Company Agreement. Under this clause, the Respondent
accepted and undertook that any trademark application filed
or registration obtained by it in respect of "NRB Industrial"
and "NRB Industrial Bearings" would always be subject to the
conditions of the Agreement. The same restrictions would
apply to its actual use of these marks. The Respondent could
use these expressions in plain text only where it was not
possible to use the prescribed logo. It agreed that it would
not use or register these marks, including on its corporate
materials, in any manner which was identical or deceptively
similar to the Petitioner's trademarks or to the manner in
which the Petitioner used its trademarks.
(d) Clause 4.3 deals with the Respondent's independent
trademarks "NIBC" and "NIBL Korta". Under this clause, the
Respondent acknowledged that it was the owner and user of
these word marks. It was permitted to continue using these
marks without any restriction on ownership or use. It could
use them along with devices, letters, numbers or colour
combinations, whether as a prefix or suffix. This permission
extended to its existing and future businesses and included
the use of these marks as company names, domain names
and social media accounts or handles. However, this right
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was subject to one important condition. The marks and the
manner in which they were used could not be identical or
deceptively similar to the trademarks owned by the
Petitioner or to the manner in which the Petitioner used its
trademarks.
(e) Clause 4.4 places a clear restriction on the use of the
word "NRB". Under this clause, the Respondent, the NIBL
Group and its affiliates agreed that they would not use or
register the word mark, logo or trademark "NRB"
independently, including on their corporate materials. The
word "NRB" could not be used along with any other
expression except "Industrial" or "Industrial Bearings". The
Respondent agreed not to use the word "NRB" in any manner
identical or deceptively similar to the trademarks, logo or
marks owned by the Petitioner or to the manner in which the
Petitioner used them. Thus, according to the Petitioner, the
Respondent's right to use the word "NRB" was limited to the
two expressions "NRB Industrial" and "NRB Industrial
Bearings", and even such use was subject to the other
restrictions contained in the Agreement.
(f) Clause 4.6 requires the Respondent to remove the word
"NRB" from the name of its company, "NRB IBC Bearings
Private Limited". Under this clause, the Respondent agreed to
apply to the Registrar of Companies for changing the name
of the said company within six months from the date of
execution of the Inter-Company Agreement. If reasonably
required, a period of three months could be taken to
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complete the process.
(g) Clause 4.7 deals with the consequences of a change in
the control of the Respondent. Under this clause, the
Respondent agreed that its right to use "NRB Industrial"
and/or "NRB Industrial Bearings" would and immediately
come to an end if control of the Respondent passed from Mr.
Devesh Sahney and his promoter group. In such a situation,
the Respondent would have to stop using these marks and
the intellectual property rights would revert to the Petitioner.
The Respondent was required to execute all documents
necessary to complete the transfer of these rights in favour of
the Petitioner, without claiming any consideration. Dr.
Tulzapurkar submitted that this condition makes it clear that
the right granted to the Respondent was neither absolute nor
permanent. It was dependent upon the existing promoters
continuing to retain control of the Respondent. Once such
control came to an end, the right to use these trademarks
would come to an end.
(h) Clause 5 prohibits the Respondent from continuing to
use the Dhannur premises as its registered office or official
address. The Respondent was required to stop using this
address in all its correspondence and communications. It was
prohibited from showing or referring to the Dhannur
premises as its registered office or official address on its
website, social media platforms or through any other public
communication.
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(i) Clause 7.1 deals with the relationship between the
Respondent and the NRB Group. Under this clause, the
Respondent agreed that neither the NIBL Group nor any of
its affiliates would, directly or indirectly, act for or on behalf
of the NRB Group or the HSZ Family Group. They were
prohibited from representing themselves as being a part of or
connected with these groups. This restriction applied to all
forms of communication, including websites, social media
platforms, visiting cards, marketing material and emails.
(j) Clause 9 provides for the remedies available in case
either party commits a breach of the Inter-Company
Agreement. The parties agreed that any breach or failure to
comply with the Agreement could cause serious and
irreparable loss to the other party. Therefore, the Agreement
preserved the right of the affected party to seek specific
performance, injunctions and other equitable reliefs, without
affecting its right to claim other remedies available in law.
(k) Clauses 10.1 to 10.6 contain the arbitration agreement
between the parties. Under these clauses, every dispute,
difference, controversy or question arising out of or relating
to the Inter-Company Agreement, including any dispute
about its existence, validity or termination, was required to
be referred to arbitration under the MCIA Rules. Mumbai
was fixed as the legal seat and venue of arbitration. The
parties agreed to appoint a sole arbitrator by mutual consent.
If they failed to do so, the arbitral tribunal would consist of
two arbitrators, one appointed by each party, and a presiding
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arbitrator appointed by the two nominated arbitrators. The
parties agreed that the Courts at Mumbai would have
exclusive jurisdiction.
18. Dr. Tulzapurkar submitted that, in consideration of the
payment of Rs.55.12 Crores, the Respondent had accepted that its
right to use "NRB Industrial" and "NRB Industrial Bearings" was
limited to bearings meant for industrial applications, in accordance
with the Demerger Order. Even for such use, it was required to
follow the particular colour scheme, font, design and appearance
prescribed under the Inter-Company Agreement. The Respondent
had agreed that it would not use "NRB" independently or along
with any other word except "Industrial" or "Industrial Bearings". It
was prohibited from using any mark which was identical or
deceptively similar to the Petitioner's trademarks. Dr. Tulzapurkar
particularly relied upon Clause 4.7. He submitted that the
Respondent had agreed that, if control of the Respondent passed
from the existing promoters, its right to use "NRB Industrial" and
"NRB Industrial Bearings" would come to an end and the rights
would revert to the Petitioner. The Respondent had undertaken to
execute all documents necessary for giving effect to such reversion.
According to him, these conditions make it clear that the
Respondent cannot use "NRB Industrial", "NRB Industrial Bearings"
or any other mark containing the word "NRB" for manufacturing,
marketing, or selling bearings used in automobiles of any
description, including farm equipment. Its permission was limited
to bearings for industrial applications and was subject to the
particular colour scheme and design and the other restrictions
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contained in the Inter-Company Agreement.
19. Dr. Tulzapurkar submitted that the acts complained of by the
Petitioner amount to a breach of the express promises and
restrictions accepted by the Respondent under the Inter-Company
Agreement. Under the Inter-Company Agreement, read with the
Demerger Order, the Respondent was permitted to use "NRB
Industrial" and/or "NRB Industrial Bearings" only for bearings
meant for industrial applications. Even for this limited purpose, it
was required to follow the specific colour scheme, design and
other visual features prescribed under the Agreement. The
Respondent had no right to use these trademarks, or any other
mark deceptively similar to the Petitioner's NRB trademarks, for
manufacturing, marketing or selling bearings for mobile vehicles of
any description, including farm equipment. The Respondent had
agreed that it would not represent as being a part of or connected
with the NRB Group. It was prohibited from representing that it
was carrying on its business from the Dhannur premises at Fort,
Mumbai. Dr. Tulzapurkar submitted that the Petitioner had paid
Rs.55.12 Crores to secure compliance with these conditions. The
Respondent was, therefore, bound to honour its promises and
comply with the restrictions imposed under the Inter-Company
Agreement read with the Scheme.
20. Apart from the breach of the contractual conditions and
restrictions, Dr. Tulzapurkar submitted that the Respondent was
infringing the registered "NRB" trademarks of the Petitioner.
According to him, the Respondent had no right to use "NRB
Industrial" or "NRB Industrial Bearings" for manufacturing,
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marketing or selling bearings for automobiles of any description,
including farm equipment. This restriction was known to the
Respondent from the time the Demerger Order was passed. It was
again recorded in the Inter-Company Agreement dated 20 January
2025. Despite knowing these restrictions, the Respondent had
started using the said trademarks for automotive bearings. Such
use, according to the Petitioner, directly interferes with its
statutory rights and ownership in the registered "NRB" trademarks.
21. Dr. Tulzapurkar submitted that the Petitioner had established
a strong prima facie case for grant of interim relief. Under the
Inter-Company Agreement read with the Demerger Order, the
Respondent's right to use "NRB Industrial" and "NRB Industrial
Bearings" was limited to bearings for industrial applications. Even
such use was subject to the prescribed colour scheme, design and
other visual restrictions. The Respondent had agreed not to
represent as a part of or connected with the NRB Group. It had
received Rs.55.12 Crores for accepting and complying with these
conditions. However, according to the Petitioner, there is clear
evidence that the Respondent has started selling automotive
bearings under the "NRB Industrial" mark. Such conduct amounts
to a direct breach of the express conditions of the Agreement. Dr.
Tulzapurkar submitted that the Respondent's application for
registration of the mark "NRB" independently, despite having
agreed not to use or register "NRB" on a standalone basis, shows
that it is attempting to claim rights beyond what was permitted
under the Inter-Company Agreement read with the Demerger
Order. He described this conduct as dishonest and contrary to the
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agreed terms. On the question of balance of convenience, he
submitted that it was in favour of the Petitioner. The Petitioner had
paid a substantial amount exceeding Rs.55 Crores to settle the
disputes and secure compliance with the conditions relating to its
trademarks and other intellectual property rights. If the
Respondent was permitted to continue selling automotive bearings
under the "NRB Industrial" mark, the Petitioner would suffer
serious and irreparable loss. The Respondent, on the other hand,
would not suffer any comparable injury if it was restrained from
using the mark beyond the limited permission granted to it.
According to the Petitioner, the Respondent was attempting to take
advantage of the goodwill and reputation built by the Petitioner
over several decades. Dr. Tulzapurkar pointed out that there was
urgency in the matter because the Respondent had recently started
selling the disputed automotive bearings in the open market. He,
therefore, submitted that interim protection was necessary to
prevent violation of the Petitioner's rights pending arbitration. In
support of his submissions, Dr. Tulzapurkar relied upon the
judgments of the Supreme Court in S. Syed Mohideen Vs. P.
Sulochana Bai, (2016) 2 SCC 683, and Laxmikant V. Patel Vs.
Chetanbhai Shah and Another, (2002) 3 SCC 65.
22. Mr. Mustafa Doctor, learned Senior Advocate appearing for
the Respondent, submitted that the Respondent does not have any
right to use the trademarks "NRB Industrial", "NRB Industrial
Bearings" or "NRB INDL" in relation to bearings meant for mobile
vehicles and farm equipment. He submitted that the Petitioner's
case is based on an incorrect reading of the Scheme of Demerger
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between the Petitioner and the Respondent, which was approved
by this Court on 24 August 2012, read with the Inter-Company
Agreement dated 25 January 2025 entered into between the
parties.
23. Mr. Doctor submitted that neither the Demerger Order nor
the contains any restriction of the nature alleged by the Petitioner.
According to him, it is not disputed that the Respondent holds
registered trademarks for "NRB Industrial" in Class 7 and Class 12
under the Trade Marks Act, 1999 (for short, "TM Act"). On the
other hand, the Petitioner does not hold any registered trademark
for "NRB Industrial" in either Class 7 or Class 12. Though the
Petitioner had applied for registration of these trademarks in the
year 2011, the applications have not resulted in registration. He
submitted that since the Respondent is the registered owner of the
disputed trademarks, it is entitled to use them. He submitted that
the Petitioner was fully aware that the Respondent had obtained
registration of the "NRB Industrial" trademark in Class 12 for
bearings for motor vehicles as far back as in the year 2016, after
following the prescribed procedure and issuing the necessary
public notice. The Petitioner knew that, after expiry of the non-
compete period, there was no restriction preventing the
Respondent from entering the business of bearings for mobile
vehicles and farm equipment or using its registered trademark in
that business. According to Mr. Doctor, the correspondence
exchanged and the conduct of the parties support this
understanding of the Demerger Order.
24. Mr. Doctor submitted that, during the years 2023 and 2024,
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the parties decided to enter into two separate arrangements,
namely, (i) a family settlement/Memorandum of Understanding
and (ii) an Inter-Company Agreement. Negotiations regarding both
arrangements were carried on at the same time. The parties were
represented by the same advocates and the correspondence and
drafts exchanged between them and their advocates were common
to both arrangements. At that stage, the proposed Inter-Company
Agreement was referred to as a "Letter Agreement", which
ultimately resulted in the execution of the .
25. Mr. Doctor submitted that, during the negotiations for the
which commenced in 2024, the Petitioner proposed to include a
condition relating to the Respondent's registered trademark in
Class 12. Under the proposed condition, the Respondent was
required to stop using, displaying, advertising or seeking business
under the said Class 12 trademark in relation to "bearings for
motor vehicles; automotive bearings". The Petitioner proposed that
the Respondent should cancel the registration of the said
trademark and withdraw all related trademark or copyright
applications or registrations, if any. The Respondent was required
to provide documentary proof of such cancellation or withdrawal.
The proposed clause sought to be included by the Petitioner in the
is reproduced below:
(d) Class 12:DSS shall and shall cause NIBL to cease and
desist from using, displaying, soliciting business under or
advertising the trademark bearing number 3246831 in
relation to Class 12 ("Class 12 TM") for goods being bearings
for motor vehicles; automotive bearings, in any medium,
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mode or manner whatsoever which forms part of the
business of NRB. Further, DSS shall and shall cause NIBL to
cancel the Class 12 TM registration and/or withdraw any
trademark and/or copyright application filed/registration
obtained in relation to the same, if any, and provide a copy
of the cancellation application and withdrawal letter duly
acknowledged by the concerned trademark registry or the
copyright office. (Note: To discuss Whether to retain)
26. Mr. Doctor submitted that the Respondent objected to the
inclusion of the aforesaid condition and it was ultimately deleted
from the final executed between the parties. Between 15 February
2024 and 20 April 2024, the advocates representing both sides
exchanged several emails regarding this proposed restriction.
However, after negotiations, the clause was not included in the
final Agreement. The Respondent seeks permission to refer to and
rely upon the correspondence exchanged between the parties in
this regard. According to Mr. Doctor, the fact that the Petitioner
proposed such a clause during the negotiations shows that the
Petitioner knew about the Respondent's registered trademark
bearing No. 3246831 in Class 12 for bearings for motor vehicles. It
shows that the Respondent intended to continue using the said
registered trademark and claimed a right to do so. He submitted
that, if the Scheme had prohibited the Respondent from using the
trademark for automotive bearings, there would have been no
need for the Petitioner to propose a fresh restriction. The
negotiations show that the Petitioner wanted the Respondent to
give up its right to use the trademark for motor vehicle bearings
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and cancel its registration. However, both these conditions were
opposed by the Respondent and were deleted from the final .
Therefore, according to the Respondent, the final Agreement
cannot be read as containing a restriction which the Petitioner had
proposed but which the parties ultimately decided not to include.
27. Mr. Doctor submitted that, under the Scheme, the Industrial
Bearings Undertaking of the Petitioner was transferred to and
vested in the Respondent with effect from the Appointed Date,
namely, 01 October 2012. The expression "Industrial Bearings
Undertaking" was defined in Clause 1.5 of the Scheme and
referred to the industrial bearings business of the Petitioner,
excluding its bearings business relating to mobile vehicles,
including farm equipment. In support of this submission, he
referred to the following provisions of the Scheme:
14.1. Clause 1.5.5(c) provides that the "Industrial Bearings
Undertaking" includes "any and all licenses, tenancies and
property rights, if any, related to Industrial Bearings
Undertaking. The trade mark 'NRB Industrial' for bearings
for industrial application whether registered in the name of
NRB or pending application of such registration and any
extensions, sub-brands and additional descriptions thereof."
14.2. Clause 1.9 defines the "Remaining Business of NRB",
inter alia, as all business of NRB, including but not restricted
to, the bearings business for mobile vehicles other than the
Industrial Bearings Undertaking.
14.3. Clause 16.2 provides that the Petitioner and
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Respondent shall enter into appropriate non-compete
arrangements on mutually agreed terms.
28. Mr. Doctor submitted that the Scheme became effective from
01 October 2012. Consequently, under Clause 1.5.5(c), the rights
in the trademark "NRB Industrial", relating to industrial
applications, stood transferred to and vested in the Respondent
from that date. Further, in terms of Clause 16.2 of the Scheme, the
parties entered into an Agreement dated 31 October 2012, which
was made effective from 01 October 2012. The purpose of the
2012 Agreement was to impose restrictions on the parties from
entering into each other's business for a period of six years. During
this period, the Respondent could not enter the business of
bearings for mobile vehicles, while the Petitioner could not enter
the business of industrial bearings. This restriction continued until
30 September 2018. Mr. Doctor pointed out that the 2012
Agreement did not contain any restriction regarding the use of
trademarks. Thereafter, on 20 January 2025, as part of the family
settlement between DSS and HSZ and their respective families, the
parties executed the following documents:
(a) A Memorandum Recording Family Settlement (for
short, "MFS"), together with supplemental deeds relating to
the two family trusts.
(b) The Inter-Company Agreement.
(c) A letter issued by the Petitioner to the Respondent "in
furtherance of the Inter-Company Agreement". Under this
letter, the Petitioner agreed to maintain the existing position
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in respect of its two eviction suits against the Respondent
concerning the Shangri-La and Dhannur premises. The
Petitioner agreed to apply for withdrawal of those suits with
prejudice within 15 days from the Effective Date under the
Inter-Company Agreement. This letter is referred to as the
"Withdrawal Letter".
29. Mr. Doctor submitted that the Inter-Company Agreement
executed on 21 January 2025 dealt with several matters, including
the release of the Respondent's rights in the Dhannur office
premises, which had vested in it under the Scheme, the mutual
non-solicitation obligations and the conditions governing the use
of intellectual property. According to him, the negotiations
between the parties, as well as their understanding at the relevant
time, show that neither the Demerger Order nor the Inter-
Company Agreement prevented the Respondent from entering the
business of bearings for mobile vehicles or from using its
trademarks in that business. He submitted that, on 17 July 2026,
the Respondent organised a launch event for its automotive
bearings business. A blue background was used for the
presentation at that event. The Respondent understood the
restriction in the Inter-Company Agreement regarding the use of
blue colour as applying only to the packaging of its products. The
Petitioner's products are packed in blue-coloured packaging,
whereas the Respondent's products are packed in red-coloured
packaging. Therefore, according to Mr. Doctor, the use of a blue
background on one occasion in a presentation could not be treated
as a breach of the Agreement. Nevertheless, with a view to
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avoiding any dispute, and without admitting any breach or
wrongdoing, the Respondent stated that it would not use blue
colour in its future promotional events. Comparative photographs
of the Petitioner's and the Respondent's products meant for the
mobile vehicle industry are enclosed.
30. Mr. Doctor submitted that Clause 1.5.5(c) of the Scheme
provides for transfer of the trademark "NRB Industrial" to the
Respondent as part of the Industrial Bearings Undertaking.
According to him, this transfer was unconditional and included
"any extensions, sub-brands and additional descriptions thereof".
The words "for bearings for industrial application" were used only
to describe the trademark which formed part of the Industrial
Bearings Undertaking on the Appointed Date. These words were
not intended to impose any permanent restriction on the
Respondent regarding the future use of the trademark or the types
of bearings which it could manufacture and sell.
31. Mr. Doctor submitted that the Scheme does not place any
restriction on the Respondent from using the trademark for other
types of bearings after the expiry of the non-compete period under
the 2012 Agreement on 30 September 2018. According to him,
there is nothing in the Scheme which restricts the goods in relation
to which the Respondent can use the trademark. He submitted that
this was the understanding of both parties when they entered into
the Inter-Company Agreement, as can be seen from the
negotiations and correspondence exchanged between them.
32. Mr. Doctor submitted that the rights retained by the
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Petitioner under the Scheme were limited to the basic mark "NRB"
and its associated description, design, colour and logo. This
reservation did not extend to the trademark "NRB Industrial"
which had been transferred to the Respondent. It did not place any
restriction on the types of goods in relation to which the
Respondent could use the trademark "NRB Industrial". Therefore,
according to him, the Petitioner cannot rely upon the reservation
of rights relating to the basic "NRB" mark to contend that the
Respondent is prohibited from using its registered trademark for
bearings meant for mobile vehicles.
33. Mr. Doctor submitted that the Scheme separately dealt with
the future business activities of both parties under Clause 16.2.
This clause provided that the parties would enter into appropriate
non-compete arrangements on mutually agreed terms. Accordingly,
the restrictions relating to the business activities of the parties
were to be governed by a separate agreement, namely, the 2012
Agreement. Therefore, Clause 1.5.5(c) of the Scheme cannot be
read as imposing any restriction on the Respondent from using the
trademark in the business of bearings for mobile vehicles, when
there is no specific condition to that effect in the Scheme.
34. Mr. Doctor submitted that any restriction preventing the
Respondent from entering the business of bearings for mobile
vehicles or from using its registered trademark in that business
must be provided in the agreement between the parties. Such a
restriction cannot be assumed or inferred merely from the
description of the trademark in the Scheme. According to him, no
such express restriction is found either in the Scheme or in the
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subsequent agreements between the parties.
35. Mr. Doctor submitted that Clause 1.5.5(c) of the Scheme is
an inclusive provision which identifies and adds the trademark
"NRB Industrial" to the assets transferred to the Respondent. It is
not a provision intended to restrict the future use of the trademark
to any particular category of goods. The reference to "bearings for
industrial application" merely describes the trademark as an asset
forming part of the Industrial Bearings Undertaking on the
Appointed Date. It cannot be treated as creating a permanent
restriction in the absence of clear words imposing such a
restriction. According to him, the interpretation suggested by the
Petitioner would amount to adding a restrictive condition to the
Scheme, although the parties had never agreed to include any such
condition.
36. Mr. Doctor submitted that the Inter-Company Agreement was
executed in the year 2025 after detailed negotiations between the
parties. During these negotiations, the Petitioner proposed to
restrict the Respondent from using the disputed trademark in the
business of bearings for mobile vehicles. However, the proposed
restriction was ultimately deleted from the final Agreement.
According to him, the Inter-Company Agreement does not contain
any restriction regarding the types of bearings in relation to which
the Respondent can use its trademarks. He pointed out that, when
the Inter-Company Agreement was executed, the trademarks
referred to in the table above at Serial No. 3 were registered in
favour of the Respondent in Class 12. Public notice regarding these
registrations had been issued. Therefore, the Petitioner had full
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knowledge of the Respondent's existing trademark registrations
and its use of those trademarks. Mr. Doctor submitted that Clauses
4.1 and 4.2 of the Inter-Company Agreement have to be read in
this background. Clause 4.2 provides that the trademarks
registered in favour of the Respondent must be used in accordance
with the restrictions contained in the Inter-Company Agreement.
Clause 4.1 deals only with the colour and manner in which the
trademarks can be used. It does not restrict the Respondent from
using the trademarks in relation to bearings for mobile vehicles as
against industrial bearings. He relied upon Clause 4.5, which,
according to him, recognises the existence of the Respondent's
registered trademarks, of which the Petitioner was aware. Thus,
the Inter-Company Agreement refers to the Respondent's existing
trademark registrations and does not impose any restriction on its
use of those trademarks in the business of bearings for mobile
vehicles.
37. Mr. Doctor submitted that, if the parties had understood the
Demerger Order as preventing the Respondent from using the
trademark for bearings meant for mobile vehicles, or if they
intended to impose any such fresh restriction under the Inter-
Company Agreement, they could have included an appropriate
condition in the Agreement. In fact, the Petitioner had proposed
such a condition during the negotiations. However, after
discussions between the parties, the proposed condition was
deleted. Therefore, according to him, the expression "in terms of
the Demerger Order" used in Clause 4.1 of the Inter-Company
Agreement cannot be read in the manner suggested by the
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Petitioner. He submitted that Clause 4.1 only regulates the colours
and visual appearance in which the trademark "NRB" can be used.
The relevant part of Clause 4.1 reads thus:
"4.1 ...NIBL shall be entitled to the continued usage of the
same in terms of the Demerger Order......in addition to the
red colour specified in the Demerger Order, NIBL shall be
entitled to use the word NRB in Pantone Scarlet Smile 10-
1558 and Pantone Russet Brown 19-1338 but not in any
other colour or colour combination. NIBL agrees,
acknowledges and undertakes not to use the term "NRB" in
any other colour including black and white." (emphasis
supplied)
38. Mr. Doctor submitted that the Petitioner is trying to read into
Clause 4.1 a restriction which is not contained in its actual words.
According to him, such an interpretation is not correct, particularly
because Clause 4.1 deals with the manner in which the trademarks
are to be displayed and must be read along with the other clauses
of the Inter-Company Agreement and the conduct and
understanding of the parties at the time of execution of the
Agreement. Therefore, the Petitioner's reliance on Clause 4.1 to
restrict the use of "NRB Industrial" only to industrial bearings is
misconceived and denied. He denied the Petitioner's contention
that, in consideration of Rs.55.12 Crores, the Respondent had
agreed that its right to use "NRB Industrial" would be strictly
limited to bearings for industrial applications. According to him,
Clause 3.1 of the Inter-Company Agreement states that the amount
was paid "to settle all the existing and potential future differences
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in relation to the use, ownership and registration of the trademark,
and use, rights, title of the Premises". Therefore, the negotiations
between the parties assume importance in understanding the
actual purpose of the payment. He submitted that Clause 3.2 of the
Inter-Company Agreement connects payment of the consideration
with the Respondent vacating the Dhannur premises and executing
a Deed of Release. In return, the Petitioner received the Dhannur
premises under the arrangement. Thus, according to the
Respondent, neither the purpose for which the consideration was
paid nor the obligations undertaken under the Inter-Company
Agreement support the Petitioner's claim that the Respondent had
agreed to restrict the use of its trademark only to industrial
bearings.
39. Mr. Doctor submitted that there is no clause in the Inter-
Company Agreement which restricts the Respondent from using
the trademark "NRB Industrial" exclusively for bearings meant for
industrial applications. Therefore, the restriction which the
Petitioner now seeks to impose is not supported by the actual
terms of the Agreement.
40. Mr. Doctor submitted that the Respondent denies having
committed any breach of the Inter-Company Agreement. However,
only with a view to avoiding any dispute, the Respondent has
agreed that it will not use the expression "NRB Group" in future.
He submitted that any reference made by the Respondent to its
earlier association with Fort, Mumbai, is merely a statement of its
past corporate history. Such a statement is true and cannot be
understood as representing that the Dhannur premises continue to
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be its registered office or official address.
FINDINGS AND REASONS:
41. Before going into the rival submissions, it is necessary to
record that the Respondent has not pressed its objection that the
dispute cannot be referred to arbitration. The Inter-Company
Agreement contains an arbitration clause. Clause 10.1 provides
that disputes arising from the Agreement shall be referred to
arbitration. Clause 10.5 states that Mumbai shall be the seat and
venue of arbitration. Clause 10.6 gives exclusive jurisdiction to the
Courts at Mumbai. Clause 10.7 makes it clear that the arbitration
clause will not prevent either party from approaching the proper
Court for interim injunctions. Since the Respondent has not
pressed its objection regarding arbitrability, there is no need to
examine that issue any further. The present Petition will therefore
be decided by considering the rights and obligations of the parties
under the Scheme and the Inter-Company Agreement.
42. The first question which arises for consideration is what
exactly was transferred to the Respondent under the Scheme of
Arrangement. For deciding this question, the Scheme has to be
read. The parties have produced Exhibit N, which contains the
Scheme. On going through the Scheme, it becomes clear that the
whole bearing business of the Petitioner was not transferred to the
Respondent. Only one part of that business, which is described as
the “Industrial Bearings Undertaking”, was transferred.
43. Clause 1.5 of Part B of the Scheme explains what is included
in the expression “Industrial Bearings Undertaking”. It says that
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the expression means the industrial bearings business of NRB,
including the agency business, “other than bearings business for
mobile vehicles of every description including farm equipments”.
Thus, the Scheme makes a clear difference between the industrial
bearings business and the business of bearings for mobile vehicles
of every description, including farm equipment. This definition has
to be read along with Clause 1.5.5(c) of the Scheme. That clause
speaks about the trade mark which was included in the transfer. It
reads as follows:
“c. any and all licenses, tenancies and property rights, if
any, related to Industrial Bearings Undertaking. The trade
mark ‘NRB Industrial’ for bearings for industrial application
whether registered in the name of NRB or pending
application of such registration and any extensions, sub-
brands and additional descriptions thereof. It is hereby
clarified that the trade mark ‘NRB’ and associated
description, design, colour and logo are exclusive property of
NRB and NIBL shall not be entitled to use (except as
provided herein), similar description, design, colour and logo
for its business.”
44. The meaning of this clause has to be understood from the
words used in it. The mark which was included in the transfer was
“NRB Industrial” for bearings meant for industrial applications.
The clause nowhere says that the Respondent was given a free and
unlimited right to use this mark for every kind of bearing which it
may manufacture or sell in future. The latter part of the clause
makes the position more clear. It states that the trade mark “NRB”
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and its associated description, design, colour and logo will remain
the exclusive property of the Petitioner. Therefore, the Respondent
received only that right which was given to it under the Scheme.
The basic mark “NRB” was never transferred to the Respondent.
45. It is necessary to look at Clause 1.9 of the Scheme, which
defines the expression “Remaining Business of NRB”. The clause
reads as follows:
“Remaining Business of NRB” means all the undertakings,
businesses, activities and operations of NRB including but
not restricted to the bearings business for mobile vehicles of
every description including farm equipments other than the
Industrial Bearings Undertaking.
46. This clause supports the difference which is made in Clause
1.5. It shows that the business of bearings for mobile vehicles,
including farm equipment, continued to remain with the Petitioner.
In this manner, the Scheme divided the bearing business into two
parts. The industrial bearings business was transferred to the
Respondent. The business of bearings for mobile vehicles
continued with the Petitioner.
47. The Respondent is right in saying that the industrial bearings
business was transferred to it. But from this, it cannot be said that
an unlimited right to use the Petitioner's mark for every kind of
bearing was transferred. The Scheme connects the use of “NRB
Industrial” with bearings meant for industrial applications. The
words “for bearings for industrial application” have to be
understood in their ordinary meaning. They tell us for which goods
the Respondent was permitted to use the mark. These words
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cannot be ignored while deciding the rights of the parties.
48. Clause 16.2 of the Scheme needs to be considered. It reads
as follows:
“NRB and NIBL shall enter into appropriate non-compete
arrangements on mutually agreed terms and conditions.”
49. This clause deals with another subject. It provides that the
parties would enter into separate arrangements under which they
would agree not to carry on each other's business for the agreed
period. But it does not say that the trade mark rights given under
Clause 1.5.5(c) would become wider after the non-compete period
was over.
50. There is a difference between having a right to carry on a
particular business and having a right to use a particular trade
mark for that business. These are two separate things. If the
restriction on carrying on a business comes to an end, it does not
mean that the right to use a trade mark becomes wider. Both rights
have to be considered separately.
51. In pursuance of Clause 16.2, the parties entered into an
Agreement dated 31 October 2012, which became effective from 1
October 2012. Clause 2.1 divided the business between the two
companies. NRB was to carry on the business of bearings for
mobile vehicles, whereas NIBL was to carry on the industrial
bearings business. Clause 3.1 imposed restrictions upon both
parties for six years. During this period, the Petitioner could not
directly or indirectly carry on the marketing, sale and distribution
of industrial bearings. In the same manner, the Respondent could
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not directly or indirectly carry on the marketing, sale and
distribution of bearings for mobile vehicles. The clause provided
that after the sixth anniversary, both parties would be free to
manufacture, market and sell bearings of any description,
including mobile vehicle bearings and industrial bearings. The
Respondent has placed considerable reliance on the latter part of
Clause 3.1. It says that after six years it became entitled to enter
the automotive bearings business. To this extent, the Respondent's
submission is correct. The restriction on carrying on each other's
business was only for six years. After that period, the Respondent
became free to enter the mobile vehicle bearings business. In the
same way, the Petitioner became free to enter the industrial
bearings business. However, this freedom was only about carrying
on the business. It did not transfer ownership of any trade mark to
the Respondent. It did not give the Respondent a right to use a
mark which was not transferred to it for that particular business.
Clause 3.1 does not say that after six years the Respondent could
use the Petitioner's mark “NRB Industrial” for mobile vehicle
bearings. It does not change Clause 1.5.5(c) of the Scheme. The
words “for bearings for industrial application” continue to remain
in that clause.
52. The difference between the right to carry on a business and
the right to use a trade mark is clear from Clause 3.2 of the 2012
Agreement. This clause deals with bearings and part numbers
which may be common for both mobile vehicle and industrial uses.
It provides that the parties must ensure that the bearings supplied
by them are sold only for the respective field of business for which
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the purchaser is buying them. It provides that the bearings must be
packed in NRB packaging or NRB Industrial Bearings packaging, as
the case may be. Thus, even where the same bearing or part
number could be used in both fields, the parties agreed that the
purpose for which the bearing was purchased and the business to
which the sale related would have to be considered. The packaging
had to be according to the concerned business. This clause does
not support the Respondent's argument that every bearing could
be sold under the mark “NRB Industrial” after six years, only
because it had become free to manufacture and sell bearings of
every description. If a particular bearing is sold for use in a mobile
vehicle, the sale would relate to the mobile vehicle business. The
fact that the same bearing or part number may be used in an
industrial machine does not change the purpose for which that
particular bearing is sold. The use for which the bearing is being
sold remains important.
53. For these reasons, I am unable to accept the Respondent's
argument that expiry of the six-year non-compete period increased
its rights under the Scheme. The 2012 Agreement removed the
restriction on the type of business which each party could carry on.
It did not give the Respondent any additional trade mark rights. If
the parties wanted to give the Respondent an unrestricted right to
use “NRB Industrial” for mobile vehicle bearings after six years,
they could have stated so in the Agreement. There is no such
provision either in the Scheme or in the 2012 Agreement.
54. The next question is whether the Inter-Company Agreement
dated 20 January 2025 changed the position which existed under
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the Scheme and the 2012 Agreement. This Agreement has to be
read as a whole. It was entered into for settling the disputes
between the parties regarding the use, ownership and registration
of the “NRB” trade mark and the rights relating to the Dhannur
premises. Recital (A) records that under the Scheme of
Arrangement sanctioned by this Court on 24 August 2012, the
industrial bearings undertaking of NRB was transferred to NIBL.
The remaining business, including the business of bearings for the
mobility industry, continued with NRB. Recital (B) then states:
“The brand ‘NRB’ is to be used by both the Parties currently
in terms of the Demerger Order. In view of this, and in view
of the Demerger Order, the Parties are now desirous of
entering into this Agreement to record their understanding
in respect of the rights for use, ownership and registration of
the ‘NRB’ brand on the terms and conditions hereunder,
which shall, in each case, be binding and enforceable upon
them, their respective successors and permitted assigns, as
well as their respective Affiliates, for all times to come.”
55. This recital is important while deciding the present dispute.
The parties have not stated that the 2025 Agreement gives NIBL a
fresh and unlimited right to use the mark for every kind of
business. On the contrary, they have recorded that the brand
“NRB” is to be used by both parties in terms of the Demerger
Order. They have stated that the Agreement is being made to
record their understanding about the rights of use, ownership and
registration of the brand. It therefore appears that the Scheme
continued to be the basis for deciding the rights of the parties. The
2025 Agreement settled those rights. There is nothing in the
Agreement to show that the restriction in Clause 1.5.5(c) of the
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Scheme was removed or that the Respondent was given any wider
right.
56. The Respondent has relied upon Clause 3.1 of the 2025
Agreement. Under this clause, the Petitioner agreed to pay
Rs.55.12 crores as consideration. Clause 3.1 refers to settlement of
all existing and possible future disputes relating to the use,
ownership and registration of the trade mark. It refers to the rights
and title relating to the premises. Clause 3.2 connects payment of
the amount with the Respondent vacating the premises and
executing the Deed of Release. I am unable to accept the
Petitioner's argument that the entire amount of Rs.55.12 crores
was paid only for restricting the Respondent's use of the mark to
industrial bearings. The words used in Clause 3.1 do not support
this understanding. The amount was paid for settling several
matters. These included the disputes regarding the trade mark and
the rights relating to the premises. Clause 3.2 connects the
payment with the Respondent vacating the premises and executing
the Deed of Release. However, this finding does not mean that the
Respondent's argument on the main issue has to be accepted. The
rights and restrictions regarding the use of the trade mark must be
understood from Clauses 4.1, 4.2 and 4.4, read along with the
Scheme. The amount paid under the Agreement cannot be used to
give the Respondent a right which is not provided in the
Agreement.
57. Clause 4.1 of the 2025 Agreement is the main clause dealing
with the use of the marks. The relevant part reads as follows:
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“Subject to Clause 4.7 below, NIBL uses the marks ‘NRB
Industrial’ and ‘NRB Industrial Bearings’ in which the word
‘NRB’ is used in a red colour combination, stylization, font
and pattern, as set out in Schedule 1. NIBL shall be entitled
to the continued usage of the same in terms of the Demerger
Order (including on Corporate Materials in the same manner
as displayed in Schedule 1 as well as in any other font and
pattern.”
58. The clause provides that:
“In addition to the red colour specified in the Demerger
Order, NIBL shall be entitled to use the word NRB in Pantone
Scarlet Smile 19-1558 and Pantone Russet Brown 19-1338
but not in any other colour or colour combination.”
59. It records the Respondent’s undertaking that:
“NIBL agrees, acknowledges and undertakes not to use the
term ‘NRB’ in any other colour including black and white,
whether on Corporate Materials or otherwise.”
60. The clause gives a limited exception for cases where the
particular medium does not allow the use of colour and permits
only black and white. Even this exception can be used only when
the inability to reproduce the mark in colour is due to technical
limitations or circumstances which are beyond the Respondent's
control.
61. On reading Clause 4.1 in its ordinary meaning, it becomes
clear that the Respondent was permitted to continue using the
marks “NRB Industrial” and “NRB Industrial Bearings” in terms of
the Demerger Order. The words “in terms of the Demerger Order”
show that the restrictions in the Scheme continue to apply under
the 2025 Agreement. If the parties wanted to remove those
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restrictions, there was no reason for including these words. At the
same time, I am unable to accept the Petitioner's argument that the
Respondent must use the mark only in the exact font and pattern
shown in Schedule 1. Clause 4.1 permits the use of the mark in the
manner shown in Schedule 1 “as well as in any other font and
pattern”. Therefore, the Respondent has been given some freedom
in choosing the font and pattern for displaying the mark. The
Petitioner cannot insist that every use of the mark must be an exact
copy of the specimen shown in Schedule 1. However, this freedom
is subject to the other conditions of the Agreement. It does not
permit the Respondent to use the word “NRB” in any colour it
wants. The Agreement limits the use of the word “NRB” to the
specified colour combinations. The exception for black and white
can be used only when the medium does not allow the mark to be
reproduced in colour. The Respondent cannot take the benefit of
this exception only because it has chosen a particular design or
format for its promotional material.
62. Clause 4.2 provides that the Respondent's trade mark
applications, registrations and use of the marks “NRB Industrial”
and “NRB Industrial Bearings” must always remain according to
the Agreement and the restrictions relating to their use. The clause
says that the Respondent need not surrender its existing trade
mark registrations or applications until it obtains registration of
the marks in the agreed colours and style. This permission is
subject to the condition that the use of those marks continues to
follow the restrictions under the Agreement. This clause is
important because the Respondent has relied upon its Class 12
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registration. Both parties were aware that the Respondent had
certain trade mark applications and registrations. Therefore, they
agreed that those applications and registrations need not be
surrendered. At the same time, they stated that the use of those
marks would continue to remain subject to the restrictions in the
Agreement. Both parts of Clause 4.2 have to be read together.
Permission to keep an existing registration does not mean that the
Respondent can use the mark in a manner which goes against the
Scheme or the Agreement. The registration may continue to
remain on the Register. But, as between these parties, the way in
which the Respondent uses the mark continues to be controlled by
the conditions agreed between them.
63. Clause 4.4 requires consideration. It provides that NIBL shall
not use the term “NRB” or along with any other words, except the
words “Industrial” or “Industrial Bearings”. It prohibits use of the
mark in a manner which is identical or deceptively similar to the
trade marks, logo or mark owned by the Petitioner or the manner
in which the Petitioner uses its trade mark. This clause does not
give the Respondent a free choice to use the word “NRB” with any
other expression. The permitted expressions have been mentioned.
The Respondent may use “NRB Industrial” and “NRB Industrial
Bearings”, subject to the other conditions of the Agreement. It
cannot use the word “NRB” along with unrelated words or in a
manner which is prohibited under the Agreement. The specimen
produced by the Petitioner shows that the expression “NRB INDL”
is engraved on the bearing. This expression is not the same as the
two marks mentioned in Clauses 4.1 and 4.2. The Respondent may
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say that “INDL” is only a short form of “Industrial”. However, the
Agreement does not use the expression “NRB INDL”. It refers to
“NRB Industrial” and “NRB Industrial Bearings”. At this stage, the
Respondent cannot introduce an abbreviated form of the mark on
the goods, particularly when the word “NRB” remains the main
and important part of that expression. Prima facie, such use is
outside the form of use agreed between the parties.
64. The Respondent has relied upon the discussions which took
place during 2023 and 2024. It is submitted that the Petitioner had
proposed a clause requiring the Respondent to stop using the mark
for motor vehicle and automotive bearings and to cancel its Class
12 registration bearing Application No. 3246831. The Respondent
objected to that proposal and the clause was removed from the
final Agreement. According to the Respondent, this shows that the
parties did not agree to restrict the use of “NRB Industrial” for
automotive bearings. This submission has to be considered. The
removal of the proposed clause shows that the Respondent did not
agree to an obligation to cancel or surrender its existing Class 12
registration. It shows that the final Agreement does not contain
any separate clause directing cancellation of that registration. I
therefore do not accept the Petitioner's prayer to the extent it asks
for cancellation or surrender of the Respondent's existing Class 12
registration in these Section 9 proceedings. Clause 4.2 recognises
that the Respondent need not surrender its existing trade mark
registrations or applications, provided that it follows the agreed
restrictions regarding their use. The clause which was removed
during negotiations cannot now be treated as if it had been
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included in the final Agreement. However, removal of that
proposed clause does not mean that the parties agreed to remove
the restriction contained in the Scheme. The final Agreement
states in recital (B) that the brand is to be used by both parties in
terms of the Demerger Order. Clause 4.1 gives the Respondent the
right of continued use “in terms of the Demerger Order”. Clause
4.2 makes the use of existing registrations subject to the
restrictions under the Agreement. There is no provision in the final
Agreement which says that the Respondent can use “NRB
Industrial” for mobile vehicle bearings even though such use is
restricted under the Scheme. There is a difference between
cancelling a trade mark registration and deciding how that
registered mark can be used. The parties did not agree that the
existing registration must be cancelled. But they did agree that the
use of the registered marks would remain subject to the
restrictions in the Agreement. Therefore, removal of the proposed
clause does not take away those restrictions.
65. The Respondent's registration of “NRB Industrial” in Class 12
is not enough to answer the Petitioner's claim of passing off. The
Respondent applied for registration on 29 April 2016. The
registration was granted on 21 February 2018 with effect from the
date of application. The registration includes goods relating to
motor vehicles and automotive bearings. The existence of this
registration is a fact which has to be considered. However, the
registration does not prove that the Respondent was using the
mark in the mobile vehicle bearings business from the date
mentioned in its application. It does not decide whether such use
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was permitted under the Scheme and the Agreement.
66. The legal position on this issue has been explained in
Century Traders v. Roshan Lal Duggar & Co., 1977 SCC OnLine Del
50 . In paragraph 9, the Court considered the difference between
an action for infringement of a registered trade mark and an action
for passing off. It observed:
“In a passing off action registration of the trade mark is
immaterial.”
67. The Court held:
“From a reading of the above sections it is clear that
registration of mark in the trade mark registry would be
irrelevant in an action for passing off. Furthermore, it will be
clear that in deciding whether a particular mark is common
to the trade use of that mark (emphasis supplied) would be
extremely relevant. Mere registration would not be enough.”
68. Thus, in a passing off action, actual use of the mark is
important. Merely because a mark is entered in the Register of
Trade Marks, it does not establish that the person concerned has
used it. In paragraph 10 of Century Traders, the Court referred to
the decision in L.D. Malhotra Industries v. Ropi Industries, ILR
(1976) 1 Del 278, and quoted the following observations:
“Use plays an all important part. A trader acquires a right of
property in a distinctive mark merely by using it upon or in
connection with his goods irrespective of the length of such
user and the extent of his trade.”
69. The Court reproduced the following part of the judgment:
“Registration does not create a trade mark. The trade mark
exists independently of the registration which merely affords
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protection under the statute. Common law rights are left
wholly unaffected.”
70. In paragraph 11, the Court referred to Consolidated Foods
Corporation v. Brandon and Co., Private Ltd., AIR 1965 Bom 35 ,
and relied upon the following principle:
“Priority in adoption and use of a trade mark is superior to
priority in registration.”
71. These observations are relevant to the present dispute. The
Petitioner has placed documents before the Court to show that it
has been using the mark “NRB” for bearings, including bearings for
automobiles and other mobile vehicles, for a long time. It has
relied upon its incorporation documents, product invoices,
advertisements, customer details and other records. It has
produced material to show that it has been using blue packaging
and get-up for its bearings for many years. The fact that the
Respondent obtained registration of “NRB Industrial” in Class 12
does not prove that it was using the mark for mobile vehicle
bearings from 2012. The date of first use mentioned in the trade
mark application is the claim made by the Respondent in that
application. From the documents placed before this Court, there is
no sufficient material to show that the Respondent was and
continuously using the mark for mobile vehicle bearings from that
date.
72. Paragraph 12 of Century Traders explains that a person need
not use a mark for a long period before acquiring rights in it. The
Court observed:
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“Actual use of the mark under such circumstances as showing
an intention to adopt and use it as a trade-mark is the test
rather than the extent or duration of the use.”
73. The Court observed that:
“A mere casual, intermittent or experimental use may be
insufficient to show an intention to adopt the mark as a
trade mark for specific article or goods…”.
74. Thus, the real question is whether the mark was used for the
particular goods with an intention to continue using it for those
goods. A mere entry in the Register cannot be treated as proof of
actual use.
75. The Respondent may have been using “NRB Industrial” for
industrial bearings after the demerger. Such use was permitted
under the Scheme. But the question in the present case is whether
the Respondent has shown that it was using the mark for mobile
vehicle bearings before the Petitioner's prior use and before the
present dispute arose. The mere fact that the Respondent has a
Class 12 registration does not answer this question.
76. The Supreme Court in Corn Products Refining Co. v.
Shangrila Food Products Ltd., AIR 1960 SC 142, as quoted in
paragraph 13 of Century Traders , observed:
“Now, of course, the presence of a mark in the register does
not prove its user at all. It is possible that the mark may have
been registered but not used. It is not permissible to draw
any inference as to their user from the presence of marks in
the register.”
77. This principle answers the Respondent's argument that its
Class 12 registration gives it a right to use the mark in the
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automotive bearings market against the Petitioner. The registration
may show that the mark has been entered in the statutory Register.
But actual use of the mark has to be separately proved.
78. In paragraph 14 of Century Traders , the Court held that the
appellant was required to establish that it had used the mark
before the respondents started using it. It held that:
“the registration of the said mark or similar mark prior in
point of time to user by the appellant is irrelevant in an
action passing off”.
79. The Court made it clear that the mere presence of a mark in
the Register does not prove that the person in whose name it is
registered has used that mark.
80. The same legal position has been recognised by the Supreme
Court in S. Syed Mohideen . The Supreme Court held that Section
27(2) of the Trade Marks Act protects the common law right of a
person to bring an action for passing off. This right is separate
from registration. A person who has used a mark earlier and has
developed goodwill in it can seek protection against a later user
whose use is likely to give the public a wrong impression. The
Supreme Court held that the rights arising from registration under
Section 28 are subject to the other provisions of the Act. Section
28(3) does not take away the right to file an action for passing off.
The rights of a person who used the mark earlier continue to
receive protection. A later registration under the Act does not take
away those rights.
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81. The three main requirements for an action of passing off are
goodwill, misrepresentation, and likelihood of damage. The person
bringing such an action need not wait until actual loss takes place.
It is sufficient to show that the use complained of is likely to cause
damage to the goodwill and business of the person who used the
mark earlier.
82. The Petitioner has produced material to show that it has
been using the mark “NRB” since its incorporation in 1965. Exhibit
A contains its certificate of incorporation. Other documents include
details of its trade mark registrations, product lists, invoices,
advertisements, turnover certificates, dealer and distributor details
and records of its customers. The Petitioner has produced
documents showing that its business extends to India and other
countries. The Petitioner has relied upon documents showing that
it has been using blue packaging and get-up from before 1995. It
says that its products are sold under the mark “NRB” through a
large network of dealers and distributors. It has stated that several
leading automobile and vehicle manufacturers are its customers.
When all these documents are read together, they show that the
Petitioner has developed goodwill in the mark “NRB” in relation to
bearings, including bearings used in mobile vehicles.
83. The Respondent has not been able to answer this material
merely by relying upon its own registration. As explained in
Century Traders , registration does not establish actual use. The
Petitioner's documents are not limited to its certificate of
incorporation. They include records relating to manufacture, sale,
promotion, and distribution of bearings over a period of time. At
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this stage, these documents are sufficient to show a prima facie
case that the Petitioner used the mark earlier and has developed
goodwill in “NRB” in relation to bearings used in mobile vehicles.
The documents regarding the Respondent's recent entry into the
automotive bearings business require consideration. Exhibit T
contains an article in the Bearing Review concerning the
Respondent's automotive bearings. Exhibit U contains the
Respondent's LinkedIn posts relating to that business. Exhibit V
contains the presentation made at the launch event dated 17 July
2026. Exhibit W contains photographs of the Respondent's
automotive bearing and its packaging. Exhibit X contains invoices
relating to purchases made by the Petitioner from the open market.
Exhibit Y contains the Respondent's catalogue of automotive
bearings. Exhibit Z contains a specimen bearing on which the
expression “NRB INDL” appears. The photograph in Exhibit W is
particularly important. The box carries the description
“AUTOMOTIVE BEARING” and displays the mark “NRB Industrial”.
The bearing shown along with the box carries the marking “NRB
INDL”. These documents support the Petitioner's case that the
Respondent has entered the automotive bearings market and is
using “NRB Industrial” or a similar expression for those products.
84. There is no dispute that after the non-compete period came
to an end, the Respondent became free to manufacture and sell
automotive bearings. The Petitioner is not disputing that right. But
the right to carry on that business and the right to use the mark
“NRB Industrial” for those products are separate matters. Under
the Scheme, the Respondent was permitted to use that mark for
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bearings meant for industrial applications. The 2025 Agreement
continued that right “in terms of the Demerger Order”. The
Respondent cannot avoid this restriction merely by pointing out
that it has a Class 12 registration. The product shown in Exhibit W
is described as an automotive bearing. Therefore, this is not a case
where there is any doubt whether the bearing is meant for
industrial use or automotive use. It is not a case where the same
part number may be used for both purposes and the actual
purpose of the sale is not clear. The description printed on the box
shows that the product is being marketed for the automotive field.
Therefore, prima facie, use of “NRB Industrial” for selling such
goods goes beyond the permission given under the Scheme and
the 2025 Agreement.
85. The Respondent has argued that “NRB Industrial” is different
from the Petitioner's mark “NRB”. According to the Respondent,
the addition of the word “Industrial” makes its mark different from
the Petitioner's mark. Having regard to the facts of the present
case, I am unable to accept this argument. The word “NRB”
continues to be the important part of the expression “NRB
Industrial”. Both parties are carrying on the bearing business. The
goods are bearings. The Petitioner has been using the mark “NRB”
for bearings, including automotive bearings, for a long time. The
Scheme recognised that the mark “NRB” belonged exclusively to
the Petitioner. It permitted the Respondent to use “NRB Industrial”
only for industrial bearings. Therefore, when the Respondent uses
“NRB Industrial” for automotive bearings, customers may believe
that those goods are connected with the Petitioner or its business.
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This possibility is stronger because the Respondent was earlier a
wholly owned subsidiary of the Petitioner. Customers may still
believe that some connection between the two companies
continues to exist. The 2025 Agreement contains a separate clause
which prevents the Respondent from representing that it is part of
or connected with the Petitioner's group. This shows that the
parties wanted to avoid any impression that their earlier
association was continuing. The Respondent cannot use the mark
in a manner which may create such an impression.
86. The Respondent has relied upon the fact that the Petitioner
did not challenge its Class 12 registration when the registration
was advertised. This fact may have some importance in
proceedings for rectification or cancellation of the registration.
However, the present Petition is not a proceeding for rectification.
The Petitioner is seeking to enforce the contractual restrictions and
protect its earlier goodwill against use which, according to it, is
contrary to the Scheme and the 2025 Agreement. The letters
exchanged between the parties in March 2015 are relevant. By its
letter dated 13 March 2015, the Petitioner objected to the
Respondent using the mark “NRB” . It called upon the Respondent
to use “NIBL” or “NRB Industrial”. The Respondent replied on 27
March 2015. The Petitioner again wrote on 31 March 2015. These
letters show that the Petitioner had raised its objection regarding
unauthorised use of the mark even at that time. The fact that the
Petitioner did not thereafter find any offending products in the
market and believed that the use had stopped cannot mean that it
had permanently given up its rights. It cannot mean that the
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Petitioner had allowed the Respondent to use “NRB Industrial” for
mobile vehicle bearings in future. In any case, the parties
thereafter entered into the 2025 Agreement and again recorded
their respective rights and obligations.
87. The Petitioner has objected to the colour and packaging used
by the Respondent. According to the Petitioner, it has been using
blue colour and packaging for a long time. Customers have come
to identify that colour and packaging with its products. The
Respondent, on the other hand, says that its products are sold in
red packaging. According to it, blue colour was used only as the
background in the promotional slide shown at the launch event.
The documents show that the Petitioner has been using blue
packaging for its products for a long period. However, the
specimen of the Respondent's automotive bearing produced at
Exhibit W shows a red box. The mark “NRB Industrial” is displayed
on that red box. The photograph does not show that the
Respondent has adopted the same blue packaging which the
Petitioner uses for its automotive bearing products. Therefore, on
the material available, it cannot be said that the Respondent is
selling automotive bearings in the same blue packaging and get-up
used by the Petitioner.
88. The position regarding Exhibit V is different. The
presentation made at the launch event shows a blue background.
At the bottom of the slide, the words “NRB INDUSTRIAL
BEARINGS LIMITED / NRB Group” appear in white. The
Respondent says that blue was used only as the background and
not for its product packaging. It is true that blue colour appears
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only in the background of the slide. However, Clause 4.1 does not
deal only with the background colour. It restricts the colour in
which the word “NRB” can be displayed. The clause permits the
word “NRB” to be used in the specified red colour and in the two
Pantone colours mentioned in the Agreement. It does not permit
the word to be used in any other colour, including black and white,
except in the limited situation where the medium does not allow
reproduction in colour. The presentation at Exhibit V is in full
colour. There is nothing to show that the medium permitted only
black and white or that the use of white was beyond the
Respondent's control. Therefore, prima facie, displaying the word
“NRB” in white in that presentation is contrary to Clause 4.1. The
Respondent's explanation that blue was used only as a background
does not answer the separate objection regarding the use of the
word “NRB” in white. At the same time, only because a blue
background was used in one presentation, it cannot be said that
the Respondent has adopted the Petitioner's blue packaging for its
automotive bearings. These are two separate issues. One is about
the use of the word “NRB” in a colour which is not permitted
under the Agreement. The other is about passing off by adopting
the Petitioner's packaging and get-up. Exhibit V supports the first
objection. But Exhibit W shows red packaging and does not
establish the second objection.
89. The Respondent has stated in paragraph 19 of its reply that
it “does not intend to use the colour blue in any promotional
events”. This statement has been considered. In view of this
statement, and because the specimen of the automotive bearing
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box is red, there is no need at this stage to pass a wider order on
the ground that the Respondent is using the Petitioner's blue
packaging for its automotive bearings. However, the Respondent
must follow Clause 4.1. It cannot display the word “NRB” in any
colour other than the colours permitted under that clause. The
exception for black and white can be used only in the limited
situations mentioned in the clause. The Respondent is bound by
the statement made in paragraph 19 of its reply. It cannot use blue
in future promotional events contrary to the statement made
before this Court.
90. The next issue is about the use of the expression “NRB
Group”. Clause 7.1 of the 2025 Agreement provides that:
“NIBL shall not, and shall procure that the NIBL Group and
its Affiliates shall not directly or indirectly (or through any
agents, nominees, representatives, officers, employees,
relatives or advisers or through any entity owned or
controlled or managed or financed by NIBL or in which they
are in any way associated) act for, or on behalf of, or
represent as part of or related to NRB Group / HSZ Family
Group (including through website, social media, visiting
cards, or any other marketing or business development
material, e-mail ids or correspondence addresses whether in
official or personal capacity and/or in the capacity as an
agent).”
91. The meaning of this clause is clear. The Respondent cannot
show or represent as being part of or connected with the NRB
Group or the HSZ Family Group. This restriction is not limited to
the use of a particular logo or particular words. It covers
representations made through websites, social media, visiting
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cards and other business material.
92. Exhibit V shows that the Respondent used the expression
“NRB Group” along with its own name in the presentation made at
the launch event. This was not merely a reference to the earlier
history of the company. The words appeared in a presentation
relating to the Respondent's present automotive bearings business.
By showing the words “NRB Group” below its own name, the
Respondent gave an impression that it was part of or connected
with that group. Such use is contrary to Clause 7.1. The fact that
the Respondent was earlier a subsidiary of the Petitioner does not
give it a right to make a present representation of association after
agreeing not to do so. The parties have dealt with this matter in
Clause 7.1 of the Agreement.
93. The Respondent has stated that it “will not use the phrase
‘NRB Group’ in the future”. This statement is taken on record. It
deals with the particular expression used in Exhibit V. However,
Clause 7.1 is wider and does not prohibit only the use of these
exact words. The Respondent cannot represent as being part of or
connected with the NRB Group or the HSZ Family Group by using
different words, a logo or any other method which gives the same
impression. The statement made in the reply cannot reduce the
obligation which the Respondent has accepted under Clause 7.1.
94. The Petitioner has complained that the Respondent continues
to use the address of the Dhannur premises. Clause 5 of the 2025
Agreement deals with these premises. Clause 5.1 requires the
Respondent to release and give up its rights and interest in the
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premises in favour of the Petitioner. Clause 5.2 requires the
Respondent to take steps to change its registered office address
and provide proof of the same to the Petitioner.
95. Clause 5.3 provides that, with effect from the date of
payment of the consideration:
“NIBL shall cease to use the address of the Premises as its
registered office address or official address for all its
correspondences and communications or engage in any act,
including but not limited to, making reference of the
Premises being its registered office or official address on any
website, social media platform or any other form of public
communication, or make an allusion of the same in any
manner whatsoever”.
96. The purpose of this clause is clear. After payment of the
consideration and release of the premises, the Respondent was
required to stop using the Dhannur premises as its present
registered office or official address. The Respondent has stated in
paragraph 29.4 of its reply that any reference to its address in Fort,
Mumbai, is only historical. According to the Respondent, such
reference cannot be treated as saying that the Dhannur premises
continue to be its registered or official address. This explanation
has to be considered. There is a difference between referring to an
earlier office address while correctly stating the past history of the
company and showing that the same premises continue to be its
present registered or official address. Clause 5.3 does not require
the Respondent to remove every historical reference to its former
address. What the clause prohibits is using that address as its
present registered or official address, or making any statement
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which creates such an impression. In view of the statement made
in paragraph 29.4, I am not inclined to hold that every historical
reference to the Fort, Mumbai address is a breach of Clause 5.3.
The Respondent's explanation is accepted to this limited extent.
However, the Respondent cannot use the Dhannur premises
address as its present registered office or official address on its
website, social media, business material or correspondence. If it
refers to that address for a genuine historical reason, it must
mention that it is a former address. Such reference must not create
an impression that the Respondent continues to have its registered
office or official address at the Dhannur premises.
97. The Petitioner has relied upon Clause 4.6 of the 2025
Agreement. This clause requires the Respondent to make an
application before the Registrar of Companies for changing the
name of “NRB IBC Bearings Private Limited” and removing the
word “NRB” from that name. The clause gives six months from the
Execution Date for this purpose. If the Respondent reasonably
needs more time, it can take a period of three months. Thus, the
clause provides a total period of nine months for completing the
change. The Agreement was executed on 20 January 2025.
Therefore, the period of nine months ended in October 2025. The
Petitioner has produced the MCA Master Data of NRB IBC Bearings
Private Limited at Exhibit AA. It relies upon this document to show
that the word “NRB” continues to remain part of the company's
name. The Respondent has not shown that it has complied with
Clause 4.6. It has not pointed out any agreement between the
parties extending the period beyond nine months. The obligation
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under this clause was clear. It did not require any agreement
between the parties. If the Respondent needed more time, the
Agreement allowed a period of three months. That period has
expired. I therefore find that, prima facie, the Respondent has not
complied with Clause 4.6. It is required to take the necessary steps
to remove the word “NRB” from the corporate name of “NRB IBC
Bearings Private Limited”. This is an obligation which the
Respondent accepted under the Agreement. It cannot avoid this
obligation merely by saying that the concerned company is its
affiliate.
98. The Respondent's reliance upon Clause 4.3 does not change
the above position. That clause protects the Respondent's
independent word marks “NIBC” and “NIBL Korta”. This protection
is subject to the condition that those marks must not be identical
or deceptively similar to the trade marks owned by the Petitioner.
The clause protects those separate marks. It does not give the
Respondent any wider right to use the Petitioner's mark “NRB” for
mobile vehicle bearings. In the same manner, Clause 4.5 contains
obligations of both parties regarding the use of each other's marks.
That clause has to be understood according to the words used in it.
It does not give the Respondent a general right to use “NRB
Industrial” for every business or every product of its choice. The
rights of the parties are controlled by the particular clauses which
deal with their respective marks and the manner in which those
marks can be used.
99. It is necessary to make clear that the present proceedings are
filed under Section 9 of the Arbitration and Conciliation Act, 1996.
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This Court is not finally deciding whether the Respondent's trade
mark registration is valid or invalid. The present proceedings are
not for rectification of the Register of Trade Marks. The
Respondent's Class 12 registration is not being cancelled or
removed by this order. No such relief is being granted in this
Petition. The findings recorded in this Petition are limited to the
contractual rights and obligations of the parties. The Respondent is
bound by the Scheme and the Inter-Company Agreement.
Although it holds a Class 12 registration, it agreed under Clause
4.2 that the use of the marks would remain subject to the
restrictions in the Agreement. The Respondent cannot rely upon its
registration to avoid the contractual obligations which it has
accepted. The present Petition concerns the alleged use of the
mark in breach of those obligations and the Petitioner's claim
based on prior use and passing off.
100. The three requirements for granting an interim injunction
are satisfied in relation to the use of the marks for mobile vehicle
bearings. The Petitioner has shown a prima facie case. The Scheme
and the 2025 Agreement support its case that the Respondent's
right to use “NRB Industrial” is limited to industrial applications.
Exhibits T, U, V, W, X, Y and Z show that the Respondent has
entered the automotive bearings market and has used the mark or
a variation of it for those products.
101. The balance of convenience is in favour of the Petitioner. The
Respondent is not being stopped from carrying on the automotive
bearings business. It is only being prevented from using the marks
which it was not permitted to use for that business. The
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Respondent can manufacture and sell such bearings under another
mark, provided that it is entitled to use that mark and does not
violate the rights of others. On the other hand, if the Respondent is
allowed to continue using “NRB Industrial” for automotive
bearings, the Petitioner's goodwill may be affected and customers
may become confused.
102. The injury which may be caused to the Petitioner cannot be
properly measured only in money. If the Respondent continues
selling automotive bearings under the mark “NRB Industrial”,
customers may believe that the products are manufactured by the
Petitioner or that the Respondent still has some connection with
the Petitioner's group. Such an impression may affect the
Petitioner's business and the goodwill which it has developed over
a long period. Clause 7.6 of the 2025 Agreement recognises that
breach of the covenants may cause irreparable injury, harm, loss or
prejudice. Clause 7.9 recognises that the parties may require
injunctions and specific performance because payment of damages
may not be an adequate remedy. Clause 9 provides for specific
performance and injunctions in case of breach. These clauses do
not mean that an injunction must be granted whenever a breach is
alleged. The Court must still consider the settled requirements for
granting such relief. However, these clauses show that the parties
themselves understood the importance of the restrictions and the
harm which may be caused if they are not followed.
103. In the decision of the Supreme Court in Laxmikant V. Patel
the Supreme Court held that where the plaintiff shows a prima
facie case of passing off, balance of convenience and likelihood of
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irreparable injury, an injunction can be granted to protect the
goodwill of the business. The plaintiff need not wait until actual
loss takes place. The possibility of confusion and damage is
sufficient. In the present case, the Petitioner has shown that it has
been using the mark “NRB” in the bearing business for a long time.
The Respondent's use of “NRB Industrial” for automotive bearings
goes beyond the limited permission under which it was allowed to
use the mark. The goods are of the same general nature and are
sold in connected markets. The word “NRB” remains the main and
prominent part of the mark. There is therefore a real possibility
that customers may believe that the products are connected with
the Petitioner. The Petitioner need not wait until a customer
purchases the Respondent's product believing it to be the
Petitioner's product.
104. The Respondent's argument that it became entitled to carry
on the automotive bearings business after expiry of the non-
compete period is accepted. But this does not answer the main
case made by the Petitioner. The Respondent is free to carry on
that business. However, it is not free to use a mark which the
Scheme permitted it to use only for industrial bearings. Therefore,
any injunction passed by this Court must be limited to the use of
the disputed marks for mobile vehicle bearings, including farm
equipment. The injunction must not prevent the Respondent from
carrying on the automotive bearings business under another mark,
provided that such use does not violate the Petitioner's rights or
the Agreement.
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105. The Petitioner has asked for an order restraining the
Respondent from using the Petitioner's blue packaging and get-up.
As discussed, the Petitioner has shown that it has been using blue
packaging for a long period. It has made out a prima facie case
that this packaging has become connected with its products.
However, the specimen of the Respondent's automotive bearing at
Exhibit W shows red packaging. At present, there is not sufficient
material to hold that the Respondent is using the same blue
packaging and get-up for its automotive bearings. The blue
background in Exhibit V relates to promotional material. The
Respondent has stated that it does not intend to use blue in future
promotional events. In these circumstances, a general order
preventing the Respondent from selling every product which uses
blue colour or blue packaging would go beyond what is established
by the material available. The Respondent must follow Clause 4.1
regarding the colour of the word “NRB”. It must follow the
statement made before this Court regarding future promotional
events.
106. The Petitioner has asked for appointment of a Court Receiver
over the goods and packaging bearing the disputed marks. It has
asked for permission to take forcible possession and for police
protection. I am not inclined to grant this relief. Appointment of a
Receiver and taking possession of the Respondent's stock is a
serious step. At this stage, the Petitioner's interest can be
sufficiently protected by passing a clear injunction against the use
of the disputed marks for mobile vehicle bearings. There is no
material available to show that the Respondent is likely to destroy
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the goods, remove them from the market or take any other step
which may make the injunction ineffective. The Respondent can be
directed to preserve the relevant records and disclose the stock of
automotive bearings bearing the disputed marks. These directions
will be sufficient to protect the Petitioner's interest at this stage.
Therefore, appointment of a Court Receiver is not necessary.
107. After considering the Scheme, the 2012 Agreement, the
Inter-Company Agreement dated 20 January 2025 and the
documents placed on record, I find that the Petitioner has made
out a prima facie case of breach of the contractual restrictions and
passing off. This finding concerns the Respondent's use of “NRB
Industrial”, “NRB Industrial Bearings” and “NRB INDL” for mobile
vehicle bearings, including farm equipment. The Respondent's
right to carry on the mobile vehicle bearings business after expiry
of the non-compete period is accepted. However, that right does
not include the right to use the disputed marks for that business.
The Respondent is required to follow the restrictions regarding the
colour of the mark, representation of association with the NRB
Group and removal of the word “NRB” from the name of its
affiliate. At the same time, I do not find that the Petitioner is
entitled at this stage to an order cancelling the Respondent's Class
12 registration, a general restraint against every use of blue colour
or appointment of a Court Receiver. The Respondent's explanation
that references to the Fort, Mumbai address are historical is
accepted. However, it cannot represent the Dhannur premises as its
present registered or official address.
108. For the reasons stated above, the Petition deserves to be
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partly allowed. The interim protection must prevent the
Respondent from continuing to use the disputed marks in the
mobile vehicle bearings business. It must ensure that the
Respondent follows the other clear obligations which it has
accepted under the Inter-Company Agreement. At the same time,
the order must not prevent the Respondent from carrying on a
business which it became free to conduct after the non-compete
period came to an end. The protection granted must remain
limited to the rights which the Petitioner has established and the
restrictions which the Respondent has accepted under the Scheme
and the Agreement.
109. In view of the above discussion, the following order is
passed:
(i) The Respondent, its directors, officers, employees,
agents, distributors and all persons acting for or on its behalf
are restrained from using the marks “NRB Industrial”, “NRB
Industrial Bearings”, “NRB INDL” or any mark deceptively
similar to the Petitioner’s “NRB” mark, for manufacturing,
marketing, selling, offering for sale or supplying bearings
meant for mobile vehicles of every description, including
farm equipment and automotive vehicles;
(ii) This restraint shall not prevent the Respondent from
carrying on the business of mobile vehicle bearings under
another mark which it is entitled to use and which does not
violate the Petitioner's rights or amount to passing off. The
Respondent shall remain free to use “NRB Industrial” and
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“NRB Industrial Bearings” for bearings meant for industrial
applications. However, such use must be strictly according to
the Scheme and the Inter-Company Agreement dated 20
January 2025;
(iii) While using the marks “NRB Industrial” and “NRB
Industrial Bearings” for industrial applications, the
Respondent shall follow Clauses 4.1, 4.2 and 4.4 of the Inter-
Company Agreement. The word “NRB” shall be used only in
the colours permitted under Clause 4.1. The exception for
black and white use shall be available only in the
circumstances stated in that clause. The Respondent shall not
use the word “NRB” in white or in any other colour which is
not permitted in full-colour promotional material. The
Respondent shall not use “NRB” or along with any
expression other than those permitted under Clause 4.4;
(iv) The statement made by the Respondent that it “will not
use the phrase ‘NRB Group’ in the future” is accepted. The
Respondent shall follow Clause 7.1 and shall not, directly or
indirectly, represent as being part of or connected with the
NRB Group or the HSZ Family Group. This restriction is not
limited only to the exact words “NRB Group”. It will cover
the use of any other words, logo, statement or manner of
representation which creates the same impression of present
association;
(v) The statement made by the Respondent in paragraph
19 of its reply that it does not intend to use the colour blue
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in any promotional events is accepted. The Respondent shall
act according to that statement. This direction is separate
from, and does not affect, its obligation under Clause 4.1
regarding the permitted colour of the word “NRB”;
(vi) The Respondent shall take all necessary steps to ensure
that the word “NRB” is removed from the corporate name of
“NRB IBC Bearings Private Limited”, as required under
Clause 4.6 of the Inter-Company Agreement. The
Respondent shall file the necessary application and complete
all steps within six weeks from today. It shall file an affidavit
stating what steps have been taken and what is the present
position regarding the change of name;
(vii) The Respondent shall not use the Dhannur premises
address as its present registered office address or official
address in any correspondence, website, social media
platform, business material or public communication. If the
address is mentioned for a genuine historical purpose, it
must be stated that it is a former address. Such reference
must not give an impression that the premises continue to be
the Respondent's present registered or official address;
(viii) Within two weeks from today, the Respondent shall file
an affidavit disclosing the quantity of unsold automotive
bearings in its possession or control bearing the marks “NRB
Industrial”, “NRB Industrial Bearings” or “NRB INDL”. The
Respondent shall preserve the relevant stock and all records
relating to manufacture, sale and supply of such goods. It
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shall not sell, offer for sale or distribute such stock for use in
mobile vehicles, including farm equipment and automotive
vehicles;
(ix) The Petitioner's prayer for appointment of a Court
Receiver and for taking forcible possession of the
Respondent's goods and packaging is rejected;
(x) The Petitioner's prayer for cancellation or surrender of
the Respondent's existing Class 12 trade mark registration is
rejected. The registration shall continue to remain on the
Register, subject to the rights and obligations of the parties
under the Scheme, the Inter-Company Agreement and the
applicable law. No final finding is made in this Petition
regarding the validity of that registration.
(xi) It is clarified that the present order shall not prevent
the Petitioner from adopting appropriate proceedings, in
accordance with law, in relation to the registration of the
Respondent’s trade mark under Class 12, including
proceedings for its cancellation, rectification or any other
relief available under the Trade Marks Act, 1999. All
questions in that regard are kept open. The present order
shall not be treated as expressing any final opinion on the
.
validity or subsistence of the said registration
110. The findings recorded in this order are based on the material
which is placed before the Court. They have been recorded for
deciding the interim protection sought under Section 9 of the
Arbitration and Conciliation Act, 1996. These findings will not
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prevent the Arbitral Tribunal from finally deciding the disputes on
the basis of the evidence and submissions placed before it.
However, until the directions passed above are changed by the
Arbitral Tribunal or by this Court, both parties shall follow them.
111. The Petition is partly allowed in the above terms. There shall
be no order as to costs.
112. At this stage, Mr. Doctor, learned Senior Advocate for the
Respondent seeks stay of the Judgment. However, for the reasons
recorded above, the request for stay stands rejected.
(AMIT BORKAR, J.)
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