Bombay HC Interim Order Restrains Former NRB Subsidiary From Using “NRB Industrial” On Automotive Bearings, But Allows Sales Under Another Lawful Mark

Under a court-sanctioned Scheme of Arrangement, NRB transferred its Industrial Bearings Undertaking to NIBL, while retaining its business in bearings for mobile vehicles, including farm equipment.

The Scheme provided for transfer of the mark “NRB Industrial” for industrial applications and reserved the “NRB” mark and associated features to NRB.

A 2012 agreement imposed reciprocal business restrictions for six years; after their expiry, both parties could enter each other’s businesses.

In 2025, the parties entered into an Inter-Company Agreement (ICA), which permitted NIBL’s continued use of “NRB Industrial” and “NRB Industrial Bearings” “in terms of the Demerger Order,” subject to specified conditions, including restrictions on colour, association with the NRB Group, and use of the Dhannur premises address.

NIBL held a Class 12 registration for “NRB Industrial.”

NRB alleged that NIBL had begun selling automotive bearings under “NRB Industrial” and “NRB INDL,” and had breached other ICA obligations.

NRB sought interim relief under Section 9 of the Arbitration and Conciliation Act, 1996.

Section 9 of the Arbitration and Conciliation Act, 1996 empowers the Court to grant interim protection pending arbitration; an injunction requires a prima facie case, balance of convenience and risk of irreparable injury.

Under Section 27(2) of the Trade Marks Act, 1999, registration does not extinguish the common-law action for passing off; the registered proprietor’s rights remain subject to the Act, including the protection of prior users discussed by the Court under Section 28(3).

Passing off requires goodwill, misrepresentation and likelihood of damage, and relief may be granted where confusion and damage are likely, without waiting for actual loss.

Century Traders v. Roshan Lal Duggar & Co., 1977 SCC OnLine Del 50, establishes that registration alone does not prove actual use and that priority of adoption and use is material.

S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, affirms the independent protection of prior-user rights and passing-off claims.

Laxmikant V. Patel v. Chetanbhai Shah, (2002) 3 SCC 65, supports injunctive protection where likely confusion and injury to goodwill are shown.

The Court also applied the Scheme and ICA as binding contractual instruments governing the parties’ permitted use of the marks.

The Court read the Scheme as transferring “NRB Industrial” only for industrial applications, while retaining the mobile-vehicle bearings business with NRB; expiry of the six-year non-compete period expanded NIBL’s freedom to conduct business, but did not enlarge its trademark rights.

The ICA preserved use “in terms of the Demerger Order,” and made existing registrations subject to the agreed use restrictions. The deletion during negotiations of a proposed requirement to cancel the Class 12 registration did not remove the Scheme’s restrictions on use.

The registration did not establish actual prior use for automotive bearings. NRB’s evidence of long-standing use and goodwill, together with evidence of NIBL’s recent automotive sales under the disputed marks, supported a prima facie contractual breach and passing-off case.

The Court separately found prima facie breaches concerning use of “NRB” in white in a full-colour presentation, the “NRB Group” representation, and failure to remove “NRB” from the affiliate’s name; it accepted that historical references to the former address were permissible if clearly identified as historical.

It declined a general blue-packaging restraint and appointment of a Receiver because the evidence showed red product packaging and did not establish a need for that more intrusive relief.

NIBL was restrained from using “NRB Industrial,” “NRB Industrial Bearings,” “NRB INDL” or deceptively similar marks for bearings meant for mobile vehicles, including automotive vehicles and farm equipment, but remained free to conduct that business under another mark it was entitled to use.

It could continue using the specified marks for industrial applications, subject to the ICA’s conditions on colour and form.

NIBL was also directed not to represent itself as connected with the NRB or HSZ Family Group, to comply with its undertaking concerning blue promotional backgrounds, to take steps within six weeks to remove “NRB” from its affiliate’s name, and not to present the Dhannur address as its current address.

It was required to disclose and preserve relevant unsold stock and records.

The Court rejected the requests for a Receiver and cancellation or surrender of the Class 12 registration, leaving any statutory challenge to that registration open.

The findings were interim and left the merits for the arbitral tribunal.