Shri Pankaj Goel vs M/S. Dabur India Ltd.
2008 Latest Caselaw 921 Del

              HIGH COURT OF DELHI AT NEW DELHI

                            FAO (OS) 82 OF 2008

                                             Reserved on :- 8th May, 2008

                                           Date of Decision: July 4th, 2008

# Shri Pankaj Goel                                 ..... Appellant
!                           Through
                                 Mr. Arun Jaitley, Mr. Rajiv Nayyar,
                                 Senior Advocates with Ms. Pratibha M.
                                 Singh, Mr. Sanjeev Singh and Mr. Y.K.
                                 Gupta, Advocates

                                    Versus

$ M/s. Dabur India Ltd.                     ..... Respondent
                       Through
                            Dr. A.M. Singhvi, Mr. Sudhir Chandra
                            Aggarwal, Senior Advocates with
                            Mr. Hemant Singh and Ms. Mamta Rani
                            Jha, Advocates

CORAM:

* HON'BLE MR. JUSTICE MANMOHAN SARIN
* HON'BLE MR. JUSTICE MANMOHAN

     1. Whether Reporters of local papers may be
        allowed to see the judgment?                            Yes.
     2. To be referred to the Reporter or not?                  Yes.
     3. Whether the judgment should be reported                 Yes.
        in the digest?

                       JUDGMENT

MANMOHAN, J :

1. The present appeal has been filed against the ex-parte

injunction order dated 20th December, 2007 passed by the learned

Single Judge. The trial court after holding that the Plaintiff's/

Respondent's Mark HAJMOLA was a well known mark under Section

2(zg) of the Trade Mark Act, 1999 held that the Defendant's mark

RASMOLA for the same product was deceptively similar and likely to

cause confusion in the minds of the customers of these products,

especially children. Consequently, by virtue of the impugned order,

the learned Single Judge restrained the Appellant/Defendant from

using the mark RASMOLA and in particular the suffix MOLA in

respect of the digestive tablets manufactured and sold by it.

2. At the outset, we suggested to both the parties that we would

request the learned Single Judge to expeditiously dispose of the

injunction application, as any decision by us would deprive either of

the party to a right of appeal. However, Mr. Arun Jaitley, learned

Senior Counsel for Appellant submitted that as the learned Single

Judge had not disposed of either the injunction application or the

Appellant's application for vacation of injunction within thirty days, the

present appeal was maintainable. In any event, both the parties

requested this Court to dispose of the present appeal on merits.

Consequently, with the consent of both the parties the present appeal

is being taken up for disposal.

3. Mr. Arun Jaitley, learned Senior Counsel for the Appellant has

contended that the Appellant has been using the mark RASMOLA for

its product namely digestive tablets since 1989. He further

contended that the Appellant's mark had been registered vide

Certificate dated 3rd July, 1996. Consequently, Mr. Arun Jaitley

submits that no suit for infringement is maintainable against the

Appellant.

4. Mr. Arun Jaitley further contended that the suffix MOLA is not

an invented word of the Respondent/Plaintiff and the latter had no

monopoly in the said word. In fact, according to the Appellant, the

word MOLA is common to the trade as more than 25 trademarks are

registered with the suffix MOLA. Mr. Arun Jaitley stated that variants

of MOLA for digestive tablets are commonly available in the market.

5. According to the Appellant, the Respondent/Plaintiff had

obtained the impugned ex-parte injunction order by concealing and

suppressing vital facts as well as by making misrepresentations

before the learned Single Judge. It was contended that the

Respondent/Plaintiff had concealed the fact of filing of three earlier

suits by it, against the user of marks SIDHMOLA, SATMOLA AND

CHATMOLA being Suit No. 1644/1998, Suit No. 62/2006 and Suit

No. 765/1993. In all the aforesaid three suits, the

Respondent/Plaintiff had got no relief and it subsequently

compromised the suits by permitting those three parties to use the

marks SIDHMOLA, SATMOLA AND CHATMOLA.

6. It was further contended that the Respondent/Plaintiff's suit is

hit by law of acquiescence and delay as the Respondent/Plaintiff had

knowledge of adoption of user of the mark RASMOLA for a long time.

In this connection Appellant relied upon back to back advertisement

of Appellant and Respondent's products on national TV channels like

Star Gold, Set Max and Doordarshan in the years 2005 and 2006. It

was further alleged that the Respondent/Plaintiff had been aware of

the user of the trade mark RASMOLA for a long time but despite their

knowledge, they knowingly made misrepresentation in the plaint

about the Appellant's adoption and user of the mark RASMOLA as of

December, 2007. Learned Senior Counsel for Appellant referred to

the cause of action paragraph in the plaint as well as the notice of

opposition dated 25th July, 2007 to the Appellants trademark

application which in turn explicitly stated that the Appellant had been

using the mark since April 1993. In this connection the Appellant

relied upon a judgment of Division Bench of this Court in B.L. & CO.

& ORS. VS. PFIZER PRODUCTS INCL. reported in 93 (2001) DLT

page 346.

7. On the other hand, Dr. A.M. Singhvi and Mr. Sudhir Chandra

Aggarwal, learned senior Counsel for Respondent/Plaintiff contended

that the Respondent/Plaintiff's registered trade mark HAJMOLA is a

coined and invented word. While part of the word HAJ is inspired by

hajma which means digestion, the other part namely MOLA means

nothing. Consequently, it was contended that the word HAJMOLA is

very distinctive and the Respondent/Plaintiffs were entitled to highest

protection in the said mark.

8. The Respondent/Plaintiff further submitted that admittedly it

was the prior user of the registered trade mark HAJMOLA and its

usage dates back to 1972. It was contended that in 1989 when the

Appellant is alleged to have first adopted the mark RASMOLA, the

Respondent/Plaintiff already had a turnover of Rs. 8.50 crores in

HAJMOLA products and its advertisement budget was Rs. 50.9

lakhs. According to the Respondent/Plaintiff its annual sales turnover

of HAJMOLA in 2007 was about Rs. 74 crores. It was, therefore

submitted that the Respondent/Plaintiff's mark was already a well

known mark.

9. It was further submitted that the Appellant's adoption of a

similar mark was dishonest and no amount of user could cure it.

According to Respondent/Plaintiff an illegitimate adoption cannot be

rectified or cured by a registration as it is a prior use which confers

proprietary rights and dishonest adoption confers no right.

10. According to Respondent/Plaintiff, Appellant's registration of its

trademark RASMOLA was of no defence as the registration was for

the whole of label/device mark and not the word RASMOLA.

Learned Counsel for the Respondent/Plaintiff submitted that in view

of Section 17 of the Trade Marks Act, 1999 no exclusivity or statutory

right can be claimed by the Appellant in the word/mark on account of

device mark registration. Learned Senior Counsel further submitted

that in view of Section 27 (2) of the Trade Mark Act, 1999 registration

does not, in any event, affect a passing off action.

11. Learned Senior Counsel for the Respondent/Plaintiff further

contended that except the Appellant claiming in the registration

certificate that it was using the mark since 1989 there was no

document on record to show any sale of RASMOLA product in the

year 1989. According to them the only evidence of use of the mark

RASMOLA by the Appellant is 2004 as invoices prior to 2004, pertain

to predecessor-in-business of the Appellant who is claimed to have

assigned the registered trademark; but there was no deed of

assignment on record stating that goodwill had also been assigned to

the Appellant. According to the Respondent/Plaintiff in the absence

of an assignment deed, the Appellant cannot claim benefit of the

alleged stray use of the mark RASMOLA by Appellant's predecessor-

in-interest. The Respondent/Plaintiff further stated that the sales

figures of RASMOLA, as claimed in the appeal, were actually the

sum total of sales of 11 products of the Appellant as reflected in the

balance sheet at pages 216 to 230 of the Paper Book.

12. As far as back to back advertisement of Appellant and

Respondent/Plaintiff products are concerned, the Respondent/

Plaintiff stated that there are 419 TV channels on which 34,27,000 TV

commercials are telecast each month. It was pointed out that

Respondent/Plaintiff itself had 450 products out of which 72 products

are exclusively advertised on 129 TV channels. According to

Respondent/Plaintiff there are 20,000 TV ads in a month of

Respondent/Plaintiff itself on 129 TV channels and therefore, it was

not possible for any company, including the Respondent/Plaintiff, to

monitor TV commercials on all the TV channels. Consequently, it

was contended that no knowledge can be attributed to the

Respondent/Plaintiff of any TV commercial of the Appellant. In this

connection the Respondent/Plaintiff relied upon a judgment/order of

this Court in AUTOMATIC ELECTRIC LIMITED VS. R.K. DHAWAN

reported in 1999 PTC (19) 81.

13. As far as the mark SATMOLA having been allowed by the

Respondent/Plaintiff is concerned, it was stated that the same was by

way of a settlement in Suit No. 62/2006 filed before this Court. The

reason given for settlement was acquiescence, as though the

Respondent/Plaintiff had issued a legal notice to SSG Pharma in

1984 but inadvertently it never followed it up till 2006 when the said

suit was filed. In any event it was submitted that Section 28 (3) of the

Trade Marks Act, 1999 permits more than one proprietor of

deceptively similar trademarks. It was also pointed out that the

Respondent/Plaintiff has filed 14 oppositions and issued 14 cease

and desist notices to various users of the suffix MOLA and in fact the

Respondent had even received four undertakings. It was further

submitted that the Appellant had failed to establish substantial

commercial use of the suffix MOLA in the trade, failing which their

plea of common to trade must fail. In any event, it was contended

that infringement of Respondent/Plaintiff's mark as pointed out by the

Appellant were insignificant and the Respondent/Plaintiff had not

abandoned its mark but were taking steps to protect the same. It was

also submitted that use of a similar mark by others, in any event,

could not be any defence to an illegal act of passing off.

14. According to the Respondent/Plaintiff there was no cogent

evidence to establish that the Respondent/Plaintiff knew about the

infringing activities of the Appellant and took positive steps to

encourage it. Consequently, it was submitted that plea of

acquiescence or delay must fail. Even otherwise it was submitted

that delay or laches would be no defence to grant of an interim

injunction against the unlawful use of Respondent/Plaintiff's

registered trademark HAJMOLA.

15. It was further submitted by the Respondent/Plaintiff that it was

entitled to the interim injunction as the use of mark RASMOLA by the

Appellant is likely to cause confusion or deception with the

Respondent/Plaintiff's mark HAJMOLA. Such use, according to it,

constitutes infringement as well as passing off. In this connection

learned Senior Counsel for Appellant relied upon a judgment of

Supreme Court in AMRITDHARA PHARMACY VS. SATYA DEO

GUPTA reported in AIR 1963 SC 449.

16. It was further contended that the balance of convenience was

entirely in the Respondent/Plaintiff's favour and further no injury

would be caused to the Appellant if the impugned interim injunction

was continued as the Appellant had 11 digestive tablets products

selling under different marks like RASGOLI, RASMOLI and

RASWALI and the Appellant was free to sell its products under those

trademarks. It was further contended that the Appellant had already

been injuncted from manufacturing and selling products under the

mark RASMOLA in the impugned packaging by District Judge,

Muzaffarpur vide order dated 19th October, 2005 in Suit No. 01/2005

filed by SSG Pharma, user of the mark SATMOLA. It was further

contended by the Respondent/Plaintiff that since the Appellant was

guilty of concealment and misrepresentation, it was not entitled to

seek any equitable relief from this Court. In this connection

Respondent/ Plaintiff relied upon a judgment of Supreme Court in

GUJARAT BOTTLING VS. COCA COLA CO. reported in AIR 1995

SC 2372.

17. In our view, an appeal against an ex-parte injunction lies only in

such cases where the Single Judge does not dispose of the

application within thirty days, without assigning any reason.

However, in the present case, the Appellant itself was not present

when its application for vacation of injunction was taken up for

hearing. In any event, the learned Single Judge could not dispose of

the injunction application due to heavy workload and paucity of time.

Even the Supreme Court in A. Venkatasubiah Naidu vs.

Chellappan reported in AIR 2000 SC 3032 has held that an appeal

lies against ex-parte injunction only in such cases where the learned

Single Judge does not give any reason for not disposing the appeal

within thirty days. Consequently, as the learned Single Judge had

given reason for not disposing of the injunction application as well as

application under Order 39 Rule 4, within thirty days, the said

injunction is not liable to be interfered on the short ground, as claimed

by the Appellant, that the said applications had not been disposed of

within thirty days.

18. According to us registration of RASMOLA by the

Defendant/Appellant offers no complete defence to it. Even Kerly in

his treatise the 'Trade Marks and Trade Names', has stated that

passing off action can succeed on the same evidence where

trademark action has failed. According to Kerly, the Trade Mark Act

affords no bar to a passing off action. In fact, this concept has been

statutory incorporated in India by virtue of Section 27 (2) of the Trade

Marks Act, 1999. Section 27 (2) clearly stipulates "nothing in this Act

shall be deemed to affect rights of action against any person for

passing off goods or services as the goods of another person or as

services provided by another person or the remedies in respect

thereof." A Division Bench of this Court in N.R. DONGRE VS.

WHIRLPOOL CORPORATION reported in AIR 1985 Delhi 300 had

on the ground of passing off, even injuncted a registered proprietor of

a trademark from using the same mark. The said judgment was

upheld by the Supreme Court in N.R. DONGRE VS. WHIRLPOOL

CORPORATION reported in 1996 5 SCC 744.

19. The Supreme Court in the case of AMRITDHARA PHARMACY

referred to hereinabove, held the mark AMRITDHARA to be

deceptively similar to the mark LAXMANDHARA. The Apex Court in

the said Judgment further stipulated that the issue was to be

examined by applying the test of an unwary purchaser having

average intelligence and imperfect recollection. The Supreme Court

in the said case held that even though a critical comparison of the two

names may disclose some points of differences, yet an unwary

purchaser of average intelligence and imperfect recollection would be

deceived by the overall similarity of the two products.

20. We find in the present case the Appellant's and Respondent/

Plaintiff's mark are not only similar but their products are identical and

are purchased by the same class of customers and the said goods

are sold through the same trading channel. In our view the trinity of

factors makes for a case for confusion and consequently for passing

off. Appellant's subsequent adoption of a similar mark seems prima

facie dishonest and no amount of user can cure it. In case the

injunction as granted by this Court is not continued, the use of the

same mark by the Appellant is likely to deceive the public at large.

21. In B.K. Engineering Complaint vs. U.B.H.I. Enterprises

(Registered) reported in AIR 1985 Delhi 210, a Division Bench of

this Court has held that trading must not only be honest but must not

even unintentionally be unfair. In Laxmikant V. Patel vs. Chetan

Bhat Shah reported in 2002 (24) PTC 1 (SC), the Apex Court has

held that where there is probability even in business, an injunction will

be granted even though the defendants adopted the name

innocently.

22. As far as the Appellant's argument that the word MOLA is

common to the trade and that variants of MOLA are available in the

market, we find that the Appellant has not been able to prima facie

prove that the said 'infringers' had significant business turnover or

they posed a threat to Plaintiff's distinctiveness. In fact, we are of the

view that the Respondent/Plaintiff is not expected to sue all small

type infringers who may not be affecting Respondent/Plaintiff

business. The Supreme Court in NATIONAL BELL VS. METAL

GOODS reported in AIR 1971 SC 898 has held that a proprietor of a

trademark need not take action against infringement which do not

cause prejudice to its distinctiveness. In EXPRESS BOTTLERS

SERVICES PVT. LTD. VS. PEPSI INC. & OTHERS reported in

1989 (7) PTC 14 it has been held as under :-

"....To establish the plea of common use, the use by other persons should be shown to be substantial. In the present case, there is no evidence regarding the extent of the trade carried on by the alleged infringers or their respective position in the trade. If the proprietor of the

mark is expected to pursue each and every insignificant infringer to save his mark, the business will come to a standstill. Because there may be occasion when the malicious persons, just to harass the proprietor may use his mark by way of pinpricks.... The mere use of the name is irrelevant because a registered proprietor is not expected to go on filing suits or proceedings against infringers who are of no consequence.... Mere delay in taking action against the infringers is not sufficient to hold that the registered proprietor has lost the mark intentionally unless it is positively proved that delay was due to intentional abandonment of the right over the registered mark. This Court is inclined to accept the submissions of the respondent No. 1 on this point....The respondent No. 1 did not lose its mark by not proceeding against insignificant infringers..."

In fact, in DR. REDDY LABORATORIES VS. REDDY

PAHARMACEUTICALS reported in 2004 (29) PTC 435 a Single

Judge of this Court has held as under :-

"..., the owners of trade marks or copy rights are not expected to run after every infringer and thereby remain involved in litigation at the cost of their business time. If the impugned infringement is too trivial or insignificant and is not capable of harming their business interests, they may overlook and ignore petty violations till they assume alarming proportions. If a road side Dhaba puts up a board of "Taj Hotel", the owners of Taj Group are not expected to swing into action and raise objections forthwith. They can wait till the time the user of their name starts harming their business interest and starts misleading and confusing their customers."

23. The Appellant's other argument that the Respondent/Plaintiff

has itself permitted the use of the mark SIDHMOLA, SATMOLA AND

CHATMOLA, does not impress us. A private settlement executed by

the Respondent/Plaintiff cannot offer a licence to the world at large to

infringe its mark HAJMOLA. Even otherwise we are of the view that

use of similar marks by a third party cannot be a defence to an illegal

act of passing off. In CENTURY TRADERS VS. ROSHAN LAL

DUGGAR & CO. reported in AIR 1978 Delhi 250 a Division Bench

of this Court has held as under :-

"Thus the law is pretty well settled that in order to succeed at this stage the appellant had to establish user of the aforesaid mark prior in point of time than the impugned user by the respondents."

In fact, in CASTROL LIMITED VS. A.K. MEHTA reported in

1997 PTC (17) 408 DB it has been held that a concession given in

one case does not mean that other parties are entitled to use the

same. Also in PRAKASH ROADLINE VS. PRAKASH PARCEL

SERVICE reported 1992 (2) Arbitration Law Reporter 174 it has

been held that use of a similar mark by a third party in violation of

Plaintiff's right is no defence.

24. In the present case we also do not find that

Respondent/Plaintiff's suit is either barred by delay or laches or

acquiescence. In fact, from the documents on record, specially at

pages 217, 352 and 361 in Paper Book, we find that the Appellant's

sales under the mark RASMOLA till the year 2004 were rather

insignificant. Even in the cause of action paragraph the

Respondent/Plaintiff has averred that though it had filed a notice of

opposition dated 25th July, 2007, yet it did not find the Appellant's

goods in the market till the first week of December 2007.

Consequently, at this stage we cannot draw the inference that the

present suit is barred by delay or laches. In any event, passing off is

a recurring cause of action and delay being a defence in equity would

not be available if the Defendant's conduct is fraudulent - as is in the

present case. Consequently in the present facts, delay and so called

concurrent use, if any, cannot be a ground for refusing interim

injunction.

25. As far as back to back advertisement is concerned, we are of

the opinion that keeping in view the Respondent/Plaintiff's

advertisement budget and the scale of advertisement carried out by

the Respondent/Plaintiff it would be difficult for us to presume at this

stage, by a few isolated incidents that the Respondent/Plaintiff was

aware of the Appellant's product since 2005. In fact, in AUTOMATIC

ELECTRIC LIMITED referred to hereinabove it has been held by this

Court that publication of Defendant's advertisement in the same

magazine by itself is not sufficient to infer Plaintiff's awareness of use

of a similar mark.

26. Consequently, the present appeal being devoid of merits is

dismissed. The parties are left to bear their own costs. However,

keeping in view the facts of the case we request the learned Single

Judge to expeditiously dispose of the present suit preferably within

six months from today. Needless to mention, that the observations

made are on a prima facie view of matter and would not prejudice

either of the parties at the time of trial of the present suit.

Manmohan, J.

Manmohan Sarin, J.

th July 4 , 2008 rn