Chawla Brothers Limited vs Kamani Vegetable Oil Industries ...
2002 Latest Caselaw 859 Bom

JUDGMENT

F.I. Rebello, J.

1. The plaintiffs and defendants are relatives. The family of Chawla was carrying on various businesses. On disputes having arisen, they agreed to refer the matter to arbitration. Before the arbitrator were the following persons :

i) Shri Gurdasmal Bodaram Chawla

ii) Shri Tarachand Bodaram Chawla

iii) Shri Nandlal Hassanand Chawla

In the Award passed Shri Gurdasmal Chawla was treated as one group. The defendant No. 2 is the son of Shri Gurdasmal Chawla. Shri Tarachand Chawla and Shri Nandlal Chawla were treated as the other group. In the arbitral proceedings, assets of Block A including the present plaintiffs were awarded to the group of Shri Tararchand Chawla and Nandlal Chawla. Assets of Block B were awarded in favour of Shri Gurdasmal Chawla.

2. The case of the plaintiff is that they alone are entitled to the Mark "Kamani" and if that be so, the defendants or persons claiming that, including family members of the defendants cannot use the word "Kamani" even for the purpose of carrying on business. It is their further contention that pursuant to the Award they have been allotted Group A. All the parties to Award agreed to abide by the Award which was passed on 8-9-1995. It is their further case that as there was a likelihood or misconstruction of Clause (12) of the Award, they sought clarification from the arbitrator, who by addenda to the Award clarified the position. It is therefore, submitted that they are the holders of the mark "Kamani" and they alone are entitled to the mark including the business name. It is further pointed out that though defendant No. 1 was incorporated in the year 1994, this fact was not brought to the knowledge of the arbitrator. It is further contended that they have now come to know that defendant No. 1 is carrying on business as that of the plaintiffs by using the trading name "Kamani" and in these circumstances, the defendant No. 1 has infringed the plaintiffs mark and as such, the reliefs as prayed for.

3. On the other hand, it is the case of defendant No. 2 that the issue before the arbitrator was division of the common and joint assets of the Chawla Brothers. That the individual assets which were not the common and joint assets and those assets where there was no common shareholding were not the subject matter of the arbitral proceeding Award. It is further contended that the word 'Kamani' is not the name or surname of any of the persons involved. It was purely a business name used by the Chawla brothers. The word 'Kamani' is also used and continues to be used by the group of Chawla brothers who had separated from them earlier. It is further contended that in the Arbitral Award, there was only a bar of three years in using the word 'Kamani' as a business name. The defendants commenced business only after the period of three years had expired. In so far as the addenda is concerned, it is contended by the defendant No. 2 that he sought clarification from his father who was party to the Award who informed him that no notice of the subsequent proceedings or the subsequent addenda or clarification passed, was notice given to him or the copy of the clarification. In support of that, there is an affidavit filed of Shri Gurdasmal B. Chawla dated 22-8-2002. It is further contended that the plaintiffs have acquiesced in the defendant No. 1 carrying on business by using the word 'Kamani' as the business name. Reliance is placed on documents to show that atleast from 1998-99, any brochures brought out by association where both parties are members and office bearers, the defendant No. 1 has been advertised in publication from by those associates. By a further affidavit of 22-8-2002, sales figures for the years 1990-2000, 2001-2002 and April 2001 to March 2002 have been set out.

4. The present suit was filed sometime in April 2002. Motion has been taken out some time in June 2002. Reliance is also placed on section 30(1)(b) of the Trade & Marks Act, 1958. It is therefore, contended that this would not be a fit case where this Court should grant any ad interim relief.

5. The plaintiffs in the motion have also sought a relief to restrain the defendants from using their Trade Marks 'Kamani' or any other deceptively similar word or mark as a Trade mark. On behalf of the defendant, their learned Counsel has made a statement that they are not using the word 'Kamani' as a trade mark and they are only using it as a business name. Statement accepted. In the light of that, no question arises to considering relief for violation or infringement of the word or logo 'Kamani' as at trade mark.

6. The facts on record show prima facie that the word 'Kamani' was being used as a business name by the Chawla brothers. The word 'Kamani' has also been registered as a trade mark of which the proprietor is the plaintiff. There are other registrations which need not be adverted to. What is clear therefore, is that the proprietor of the trade mark is the plaintiff. The defendants are not using the trade mark. Next is the Award pursuant to difference arised between Chawla brothers. From the Award, what is clear is that businesses or establishment having the name 'Kamani' along with other businesses not having that name were allotted to the group of Shri Tarachand and Nandlal. There were also other properties which did not bear the said name. Amongst the asset, marked as the property were the trade marks. In Clause (5) of the Award, arbitrator held that all the Companies properties assets, machinery and equipment goods (rented premises), trade names, trade marks and other tangible and intangible articles comprising Block A which belong to Shri Tarachand and Shri Nandlal. Similarly is the expression used in so far as Clause (6) is concerned. Clause (12) provides that parties retiring from 'Kamani' block along with family members will not use the word 'Kamani' or any other word, trade name, logo representation similar to Kamani directly or indirectly as the company name, brand name or trade mark registered for a minimum period of three years from today. Similar direction was given in respect of the assets of Block B. In Clause (24), the parties agreed that they had liberty to move the arbitrator in case of any doubt or circulation on any point including the mode of implementation of the Award. At the foot of the Award, parties accepted the Award and that they would implement and carry out the same as directed.

7. It is therefore, clear on a perusal of Clause (12), that it would seem that though company name, brand name or Trade mark were allotted to each of the group, they were precluded from using it for a minimum period of three years. On behalf of the plaintiffs, their Counsel contends that the expressive minimum years does not mean minimum but in perpetuity, as the later part of the clause sets out that all brand names, Trade Mark and Company/firm name shall remain with the respective blocks. It is then pointed out that a clarification was sought and clarification was given by the addenda to the Award. On behalf of the defendants, it was their contention that this Award was made without notice to them and consequently, would not be binding on them.

8. At this stage, I need not go into the issue or the provision of the Arbitration Act, 1940 or even whether notice of the hearing was given to Shri Gurdasmal. The Award itself provided stipulation that as parties could move the arbitration for clarification. Therefore, the clarification could have been sought by the Tarachand and Nandlal group who are asking reliance on that Award. In paragraph No. 2, the clarification sought is set out as under:-

"It has however been brought to my notice that the position with regard to the ownership rights in the Trade Mark and/or brand names used by the Receiver, respective parties needs to be clarified and hence, this clarification issued by me. The clarification is as under :

"......and both the groups shall not use or register in their name or trade mark/brand name or any word deceptively similar thereto directly or indirectly as trade mark and/or the brand name in relation to it's goods, which will violate the trade mark/brand name of the other two."

9. It is therefore, clear that no clarification was sought in so far as using word "Kamani" as a company name. The clarification sought was in respect of the brand name or trade mark. That has been clarified. On behalf of the plaintiff, their learned Counsel contends that considering the judgment in Kirloskar's case, business name also ought to fall within the said Award and/or that it is the plaintiffs who alone statutorily can use the said name. There seems to be fallacy in that argument. In Kirloskar's case, the dispute was not inter se within the family but, outsiders who were seeking to use the word 'Kirloskar'. In the instant case, it was the family comprising the Chawla brothers who were using the name 'Kamani'. Once that be the case, it was open to the parties or to the arbitrator either to allot the name exclusively or restrict it to other. In the instant case, prima facie a reading of the clause would indicate that whereas the trade mark and brand names have been made exclusive so far as the use of the word 'Kamani' as a business or company name is concerned, it's use restricted and for a period of three years. Once that be the case, in my opinion, this would not be a fit case where any ad interim relief should be granted as there is no other material before me to accept the interpretation sought to be given by the plaintiffs to the clause of the Award and clarification given.

10. We then have facts on record that the plaintiffs were aware of the existence of defendant No. 1 as set out in the affidavit in rejoinder of Tarachand Bodharam Chawla in paragraph No. 3. It is set out that name of defendant No. 1 has appeared in the magazine/publication brought out by Shri Sukkur Panchayat of Mumbai in 1998-2000 where both groups were on the managing committee. The only explanation is that no business was being carried on. That has been controverted by the defendants by placing on record the sales figures which are Exhibit-B to the additional affidavit of Omprakash Chawla. Additional material is the annual report of the Cochin Oil Merchants Association for the year 1999-2000 and 2001-2002. What is relevant to note is that plaintiffs are shown in the report of 1999-2000 under Item No. 14 along with their Kerala General Sales tax number and Central Sales tax number. Similarly, defendant No. 1 is also shown with the Kerala General Sales tax number but, no Central Sales tax number. Apart from that, plaintiffs and defendants are carrying on business at Nadsi Nath Street which is close to each other and apart from that are residing in the same building. The defendants have placed on record that they have several dealers and representatives and the projected sales for this financial year would be around Rs. Seven crores. It is impossible on these facts to believe that the plaintiffs had no knowledge that the defendant No. 1 was carrying on business in that house.

On behalf of the plaintiffs, their learned Counsel relied on the judgement in Electrolux Ltd. v. Electrix Ltd. and another, 1954 R.P.C. 23, to contend that in the case of infringement, the mere fact of delay in taking out the motion would be no answer. To my mind, the issues involved in that judgment are distinguishable from the fact involved in the present case. It was the family which was using the name 'Kamani' which is now subject to the Arbitral Award. On behalf of the defendants, their learned Counsel relied on the judgement of the Apex Court in Power Control Appliances Co. & others v. Sumeet Machines Pvt. Ltd., 1994 I.P.L.R. 117. There again, dispute was within the family. What was important to note is the finding by the Court that it was the appellant who were the holders of the mark and merely because the son had carried on some business would not give him a right to carry on the business under the mark registered in favour of the appellant. In this case, as already pointed out, there is a serious dispute as to the interpretation of the Arbitral Award and the use of the word 'Kamani' as a business name. Prima facie from the material on record, I have held that the Award only prohibited use of the word 'Kamani' as business name for a period of three years. The defendant therefore, could only use the word after the expiry of said period of three years as contended by them in the affidavit-in-reply opposing the motion.

10-A. At this stage, I need not consider or decide the issue of interpretation under section 30(1)(b) of the Trade and Merchandise Mark Act, 1958.

10-B. For all the aforesaid reasons, this will not be fit case where irreparable loss or injury would be occasioned to the plaintiffs and on the balance of convenience in their favour, the defendant No. 1 is a company those sales figures are available. In these circumstances, no case made out for any ad interim relief.

Ad interim relief rejected.

Motion made returnable after eight weeks.

To be placed on board in it's own turn.

Certified copy expedited.