Full Judgment Text
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CASE NO.:
Appeal (civil) 6622 of 2005
PETITIONER:
Bhavanesh Mohanlal Amin and Anr.
RESPONDENT:
Nirma Chemicals Works and Anr.
DATE OF JUDGMENT: 07/11/2005
BENCH:
ARIJIT PASAYAT & C.K. THAKKER
JUDGMENT:
J U D G M E N T
(Arising out of SLP (C) No. 12120 OF 2005)
ARIJIT PASAYAT, J.
Leave granted.
Challenge in this appeal is to the legality of the
judgment rendered by a learned Single Judge of the Gujarat
High Court upholding the order passed by City Civil Judge,
Ahmedabad in Suit No.1952/1999 granting ad interim
injunction restraining the appellants from using the mark
"NIMA".
The background facts giving rise to the appeal
essentially are as follows:
The respondents-original plaintiffs filed civil suit
no.1952/1999 for a declaration and permanent injunction,
projecting the factual position as follows:-
The plaintiff no.1 is a Company incorporated under the
provisions of the Companies Act, 1956 and plaintiff no.2 is
a Trust registered under the provisions of the Indian Trust
Act, 1882. Plaintiff no.1 is the owner and proprietor of the
trade mark NIRMA and the same trade mark has been assigned
in favour of plaintiff no.1 by way of assignment deed. The
assignment deed is filed for registration under the
provisions of the Trade Marks Act, 1999 (in short the ’Act’)
and plaintiff no.1 is engaged in the business of
manufacturing and marketing various consumer products in
India and elsewhere.
The plaintiff’s predecessor-in-title started
manufacturing and marketing detergent powder, detergent cake
and other products in India and elsewhere. The word NIRMA
has been coined and invented from the name of NIRUPAMA,
daughter of Smt. Shantaben K. Patel, a partner of the said
partnership firm and as such trade mark NIRMA has been
registered. The same is continuously used in various packing
materials for different products i.e. soap, detergent
powder, detergent cake, cleaning preparations, etc.
Trade mark "NIMA" is also used and got registered
under the Act in respect of various classes like spices,
match box and other consumer items. Plaintiff’s products
are sold throughout India and the name NIRMA has acquired
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reputation and goodwill in the market. The plaintiffs have
applied for registration of similar names NIRMAL, NIMA and
also applied for exclusive right to use of the said words.
Plaintiffs have got registration of mark NIMA. The plaintiff
no.1 is registered at Registration No.422839 in respect of
the goods covered in Class 7 and, therefore, the use of the
same or any other identical or deceptively similar name by
any other person, more particularly by the defendants
amounts to infringement to the plaintiff’s trade marks.
Trade mark NIMA is also registered bearing Registration
No.396185/B of 1982.
It is alleged that the appellants-defendants have
adopted and started using the word NIMA for their product
flour mills. Therefore, Notice was served on 22.9.1998
calling upon the defendants to stop using the trade mark
NIMA. The defendants replied to the Notice on 7.10.1998.
Again, another notice was served to which there was no
reply. According to the plaintiffs, by using the word NIMA
the defendants are creating confusion and deception in the
mind of general public because the word NIMA is identical
and deceptively similar to the plaintiff no.1’s very popular
trade mark NIRMA. However, the defendants declined to stop
using the word NIMA for their products. Under these
circumstances, the plaintiffs filed the aforesaid Civil
Suit.
The trial Court after hearing the parties passed an
order on 11.2.2000, whereby the appellants were restrained
by an order of temporary injunction from manufacturing and
marketing their products i.e. flour mills (Ghar Ghanti) by
using the word NIMA till hearing and final disposal of the
suit.
Against the aforesaid order the appeal was filed before
the Gujarat High Court by the original defendants. As noted
above the High Court dismissed the appeal.
The High Court referred to several decisions of this
Court and various High Courts and held that the trial Court
was justified in granting ad interim injunction in favour of
the plaintiffs. It came to the following findings:
"From the above discussions, it is clearly
established that the plaintiffs have
statutory rights since they have registration
of the trade marks NIRMA and NIMA. If
injunction was not granted in favour of the
plaintiffs, it would have amounted to
infringement of the trade mark of the
plaintiffs. The trial Court has rightly
concluded that if the defendants were
restrained from using the mark NIMA, it would
not cause any irreparable loss to the
defendants since the defendants had entered
the market only before a couple of years,
whereas against that, the plaintiffs were
doing business with the said marks since the
last two decades. Moreover, the total
turnover of the plaintiffs is more than 900
crores and average annual budget for
advertisement is about 11-12 crores.
Therefore, if the defendants are not
restrained from using the said mark, it would
cause irreparable loss to the business,
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reputation, goodwill etc. of the plaintiffs.
As said above, if the defendants are
aggrieved by the presence of the said mark on
the register, the only course available to
them is to prefer rectification application
before the appropriate authority in order to
get the said mark scored off of the
register."
In the present appeal the primary stands of the
appellants are as follows:
"Appellant No.1 is a firm inter alia
engaged in the manufacturing, marketing and
selling of electric flour mill (Ghar Ghanti)
since 12.4.1997. The application dated
29.10.1998 w.e.f. 12.4.1997 for registration
of the mark "NIMA" filed by the appellants
is pending before the Trademarks Registry,
Ahmedabad in respect of products under class
7 being machines and machine tools, motors
(except for land vehicles), machine coupling
other than belting (except for land
vehicles).
The respondents, on the other hand, are
owners of registered trademark "NIRMA" for
goods under Class 3 being washing soaps and
detergents in the form of powder, cake or bar
(not for use in industrial or manufacturing
processes), cleaning powder. They hold a
trade mark "NIRMA" in respect of goods
under Class 7 since 25.6.1984. The
respondents herein according to appellants
have never used the trademark "NIRMA" for
the goods falling under Class 7 for last more
than two decades.
The goods falling under Class 7 are as
under:-
Class 7:- Machines and machine tools;
motors and engines (except for land
vehicles); machine coupling and
transmission components (except for land
vehicles) agricultural implements other
than hand operated; incubator for eggs.
Respondents also hold a registered
trademark with respect to mark "NIMA" since
8.10.1982 with respect to goods under Class
3.
The goods falling under Class 3 are as
under:-
Class 3:- Bleaching preparations and
other substances for laundry use;
cleaning, polishing; scouring and
abrasive preparations; soaps, perfumery,
essential oils, cosmetics, hair lotion,
dentrifices.
The respondents got registered trademark with
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respect to mark "NIMA" under Class 7 goods
on 20.12.2004 w.e.f. 15.10.1998 i.e.
subsequent to the date from which the
appellants have been using the mark "NIMA"
for manufacturing and selling electric flour
mill which falls under Class 7. With respect
to mark "NIMA" the appellants herein are a
prior user for goods falling under Class 7.
In any case, the respondents have not used
the mark "NIMA" or "NIRMA" for goods or
products under Class 7 till date."
Learned counsel for the appellants has further
submitted that the High Court erred in upholding the order
of restraining appellants from using mark "NIMA" as the
action of passing of is immaterial when the case of the
parties are different, their trade channels are different
or prices are different. It was pointed out that the
appellants had prior user in respect of the mark NIMA for
goods under Class 7 of the Act. It was further submitted
that the appellants and the respondents dealt with
completely different Class of goods with different prices
and customers and, therefore, ad interim injunction should
have been granted. The trademark NIMA was resisted only
in respect to the goods under Class 7 at the relevant time
and, therefore, the High Court should not have extended
the protection with respect to goods falling under Class
7.
In response, learned counsel for the respondent
submitted that goodwill generated by the respondents by
huge investments is intended to be exploited by the
appellants by using deceptively similar names. It is a
clear case of passing off. It was pointed out that as the
phrase ’passing off’ itself suggests in an action of
’passing off’ is to restrain the defendant from passing
off its goods or service to the public as the plaintiffs.
It is an action not only to preserve the reputation of the
plaintiff but also to safeguard the public. With respect
to decisions of this Court in Mahendra & Mahendra Paper
Mills Ltd. v. Mahindra & Mahindra Ltd. (AIR 2002 SC 117)
and Satyam Infoway Ltd. v. Sifynet Solutions (P) Ltd.
(2004 (6) SCC 145) and the large number of other decisions
it was submitted that the ad interim injunction was
granted by the trial Court on proper consideration of
relevant aspects. It is submitted that the High Court was
justified in upholding the order of ad interim injunction
after analysing the legal position in detail, and keeping
in view the jurisdiction of appellate Courts in such
matters.
In Cadila Healthcare Ltd. v. Cadila Pharmaceuticals
Ltd. (JT 2001 (4) SC 243), this Court laid down certain
factors in order to decide an action of passing off on the
basis of unregistered trade mark. It has held that factors
like nature of the marks i.e. whether the marks are word
marks or label marks, the degree of resembleness between
the marks phonetically similar and hence similar in idea,
the nature of the goods in respect of which they are used
as trade marks, the similarity in the nature, character
and performance of the goods of the rival traders, the
class of purchasers who are likely to buy the goods
bearing the marks they require, the mode of purchasing the
goods or placing orders for the goods and any other
surrounding circumstances which may be relevant in the
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extent of dissimilarity between the competing marks are to
be considered.
In Mahendra & Mahendra case (supra) it was observed as
follows:
"........the name has acquired a
distinctiveness and a secondary meaning in
the business or trade circles. People have
come associate the name "Mahindra" with a
certain standard of goods and services. Any
attempt by another person to use the name in
business and trade circles is likely to and
in probability will create an impression of a
connection with the plaintiffs’ group of
companies. Such user may also effect the
plaintiff prejudicially in its business and
trading activities."
In Satyam Infoway Ltd. case (supra) it was held that to
establish an action of passing off three elements are
needed to be established. They are as follows:
"(a) The first element in an action for
passing off, as the phrase "passing off"
itself suggests, is to restrain the defendant
from passing off its goods or services to the
public as that of the plaintiff’s. It is an
action not only to preserve the reputation of
the plaintiff but also to safeguard the
public. The defendant must have sold its
goods or offered its services in a manner
which has deceived or would be likely to
deceive the public into thinking that the
defendant’s goods or services are the
plaintiffs. (b) The second element that must
be established by the plaintiff is
misrepresentation by the defendant to the
public and what has to be established is the
likelihood of confusion in the minds of the
public that the goods or services offered by
the defendant are the goods or the services
of the plaintiff. In assessing the
likelihood of such confusion the Courts must
allow for the "imperfect recollection of a
person of ordinary memory". (c) The third
element of a passing off action is loss or
the likelihood of it."
We find that it would not be proper to go into the
legal position to be applied to the factual background in
detail. The High Court noted and directed as follows:
"However, since the suit in question is
of the year 1999, the City Civil Court,
Ahmedabad, is directed to expedite its
hearing and to dispose it of within a period
of six months, if it is already ripe for
hearing; otherwise, within a period of two
years from the receipt of writ of this order.
Office is directed to send writ of this order
forthwith. With the above observations and
directions, this appeal from order stands
disposed of. Interim relief granted earlier
stands vacated. No order as to costs."
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It is pointed out by learned counsel for the
respondents that since the appellants have moved for action
in terms of Section 111 of the Trade and Merchandise Marks
Act, 1958 (in short the ’Old Act’) corresponding to Section
124 of the Act there is no scope for proceeding in the suit
further. Learned counsel for the parties agreed that an
early disposal of the matter would be in the interest of the
parties. Learned counsel for the appellants fairly stated
that the question relating to bar of jurisdiction in terms
of Section 111 of the Old Act corresponding to Section 124
of the New Act shall not be raised and the trial Court would
be free to proceed with the suit.
In the aforesaid background we direct the trial Court
to dispose of the suit as early as practicable preferably by
the end of January, 2006. Residual question is whether as
contended by learned counsel for the appellants the
protection given by the High Court while disposing of the
appeal and extended by this Court initially by orders dated
27.5.2005 and 13.7.2005 should be continued as the
conclusions of the trial Court as affirmed by the High Court
are erroneous in law and the appellants have a fair chance
of success in the suit. On the other hand, it was pointed
out by learned counsel for the respondents that the
respondents have succeeded before two courts and the correct
position in law has been kept in view.
On the peculiar circumstances, we feel it would be
desirable to vary the interim order to the extent that there
shall not be stay of operation of the High Court’s order but
without leave of the trial Court the respondents shall not
initiate any action for user of the mark NIMA by the
appellants till the disposal of the suit.
The appeal is disposed of without any order as to
costs.