Allied Blenders & Distillers ... vs Paul P.John & Ors.
2008 Latest Caselaw 1771 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+                                 FAO (OS) 347/2008

      ALLIED BLENDERS & DISTILLERS P.LTD.      ..... Appellant
           Through: Mr. Sudhir Chandra, Sr. Adv.
                    Mr. Sandeep Sethi, Sr. Adv. With
                    Mr. Praveen Anand, Mr. Sanjay Chhabra
                    and Mr. Mohit Lahoty, Advocates


                                  versus

      PAUL P. JOHN & ORS.                   ...... Respondents
           Through: Mr. Arun Jaitely, Sr. Adv.
                     Mr. Sanjay Jain, Sr. Adv. With
                     Mr. Sushant Singh, Advocate

+                                 FAO (OS) 365/2008

      ALLIED BLENDERS & DISTILLERS P.LTD.      ..... Appellant
           Through: Mr. Sudhir Chandra, Sr. Adv.
                    Mr. Sandeep Sethi, Sr. Adv. With
                    Mr. Praveen Anand, Mr. Sanjay Chhabra
                    and Mr. Mohit Lahoty, Advocates


                                  versus

      PAUL P. JOHN & ORS.                   ...... Respondents
           Through: Mr. Arun Jaitely, Sr. Adv.
                     Mr. Sanjay Jain, Sr. Adv. With
                     Mr. Sushant Singh, Advocate


                                  DATE OF DECISION:
%                                    29.09.2008

CORAM:

*     Hon'ble Mr.Justice Pradeep Nandrajog
      Hon'ble Mr.Justice Sunil Gaur


1. Whether reporters of local papers may be allowed
to see the judgment?                  Yes.


FAO (OS) No.347/2008 & 365/2008                         Page 1 of 16
 2. To be referred to the Reporter or not?             Yes.

3. Whether judgment should be reported in Digest?                  Yes.


PRADEEP NANDRAJOG, J.

1. By a common order dated 11.7.2008, five

applications, three applications filed in CS(OS) No.383/2007 and

two applications filed in CS(OS) No.1058/2002 have been

disposed of resulting in the appellant who was the plaintiff in

both suits not being held entitled to any interim injunction

against the respondents who were the defendants in the two

suits. The result is that the respondents have been permitted to

sell whisky under the trade-mark/trade-name „ORIGINAL

CHOICE‟. However, the respondents have been directed to

maintain accounts in respect of the sales and make the sale

available to the Court as and when so directed.

2. CS(OS) No.1058/2002 was filed somewhere in the

middle of the year 2002; action was for an alleged passing off.

Appellant‟s application for registration of the mark „OFFICERS

CHOICE‟ was pending registration with the Registrar of

Trademarks in relation to whisky falling under class 33 of the

fourth schedule to the TM Rules. During the pendency of the

said suit the registration was granted on 19.4.2007 but with a

disclaimer that the appellant would not have any exclusive right

to the use of the word „CHOICE‟. Upon registration of the mark

„OFFICERS CHOICE‟ a second suit was filed being CS(OS)

No.383/2007 maintaining an action for infringement of the

registered trademark of the appellant.

3. The respondents had also applied for registration of

their mark „ORIGINAL CHOICE‟ which was registered by the

Registrar of Trademarks in the year 2007.

4. The appellant took recourse to the statutory remedy

under the TM Act 1999 before the Intellectual Property Appellate

Board questioning the registration granted by the Registrar of

Trademarks to the Mark „ORIGINAL CHOICE‟. Said proceedings

are still pending.

5. Before the learned Single Judge on the original side of

this Court, both the suits were stayed by consent of parties in

view of Section 124 of the TM Act 1999. But, in view of sub-

Section 5 of Section 124 of the TM Act 1999, the interlocutory

applications seeking interim orders were heard with a clear

understanding that the learned Trial Judge would consider the

rival versions in relation to the plea of passing off.

6. The learned Trial Judge has declined the interim

injunction as prayed for by the appellant holding that the

appellant was aware since 1995 that the defendant was

marketing whisky under the trade-mark/trade-name „ORIGINAL

CHOICE‟ and that delay and acquiescence being major

considerations in an action for passing off, the case of the

appellant was seriously dented. With respect to the quantum of

sale of whisky effected by the respondents since 1996 it has

been held that the same show that the respondents grew

substantially and the appellant sat by watching the respondent

grow in the market and hence was not entitled to the

discretionary relief of injunction. The second reason given by

the learned Trial Judge is that the labels used by the appellant

and the respondents for sale of their product do not give the

impression that the bottles and the labels of the respondents

could be passed off as the bottle and label of the appellant.

7. Learned counsel for the parties argued the appeal in

relation to the said two findings of the learned Single Judge.

Sh.Sudhir Chandra learned Senior Counsel for the appellant

urged that both views expressed by the learned Trial Judge are

unsound for the reason there was no material to show that the

appellant was aware of the sales effected by the respondents

since 1996 for the reason the sales were confined only in the

State of Karnataka where the respondent had made an entry in

the year 1996. It was urged that the learned Single Judge failed

to appreciate the plea of the appellant that the whisky sold by

the appellant under the trade-mark „OFFICERS CHOICE‟ was

popularly known as „OC‟ and that the deception has to be

considered keeping in mind a consumer at the whisky shop or at

a bar, who would presumably ask for „OC‟ whisky and could be

misled by a whisky bottle displaying the name „ORIGINAL

CHOICE‟ as „OC‟ whisky. Learned Senior Counsel further urged

that the question whether deception can occur has to be

approached from the point of view of a man of average

intelligence and imperfect recollection. The overall structural

and phonetic similarity of the two names has to be kept in view

with equal weightage to both facets i.e. „structural‟ and

„phonetic‟. Learned Senior Counsel urged that the bottles used

by the respondents were identical to those of the appellant. The

label having white background with printing in red colour; the

cap being white with print in red colour was the same in the two

products i.e. that of the appellant and the respondents. Since

the trade channel was the same and class of consumer was

common, learned Senior Counsel urged that having not taken

into consideration all said factors, the learned Single Judge has

acted with material irregularity while exercising the equitable

jurisdiction.

8. Sh. Arun Jaitely learned Senior Counsel for the

respondent urged that admittedly, the appellant learnt about

the respondents product entering the market when the

respondent applied for approval of its label before marketing the

product in the State of Karnataka as per the requirement of

Karnataka Excise (Bottling of Liquor) Rules 1967. The appellant

admittedly filed objections on 17.10.1995 before the

Commission of Excise Karnataka, inter alia, objecting as under:-

"As you are aware, under an arrangement with Tracstar Investments Ltd., Bangalore we have authorized them to bottle and sale one of our brands of Indian Made Foreign Liquor (IMFL) viz. Officer‟s Choice Prestige Whisky, among others. The aforesaid label of Officer‟s Choice Prestige Whisky has already been approved by you for Tracstar Investments Ltd. to manufacture and sale.

We have come across a new brand of IMFL under the name and style of "ORIGINAL CHOICE PRESTIGE WHISKY" which has been introduced in Karnataka market by one National Distilleries & Allied Products, Panthrapalaya, Mysore Road, Bangalore - 560 039. This has been done with a clear intention of passing it off as our product Officer‟s Choice.

It is a common practice in liquor trade to refer to popular brands in short by its initials, like OC for Officer‟s Choice. You will appreciate that the abbreviations for the new brand of "ORIGINAL CHOICE" is exactly the same as that of our brand "OFFICER‟S CHOICE".

This apart, the colour combination and lettering style in the label of the infringing brand of "ORIGINAL CHOICE" is deceptively similar to that of our brand "Officer‟s Choice" both visually as well as phonetically. You will agree that it will create confusion in the market and will mislead the customers in general, if it is allowed to be sold side by side with our product Officer‟s Choice. This will cause immense damage to the long standing

reputation and goodwill of our renowned brand under reference "Officer‟s Choice".

9. Drawing attention to a chart showing the comparative

sales (in crates) it was urged that till the first suit was filed in the

year 2002, the respondent constantly grew in the market and

has continued to grow till date and has in fact overtaken the

sales effected by the appellant. Therefrom, Sh.Arun Jaitely

learned Senior Counsel sought to bring home the point that it

was a clear case of acquiescence disentitling the appellant to

any interim relief who sat by the side, watching the respondent

spend money on expansion and marketing. The comparative

sale figures referred to by Sh. Arun Jaitely learned Senior

Counsel for the respondent are as under:-

S.No. Year           Original     Original    Total          Officer
                     Choice-      choice    -                Choice
                     Whisky       Rum, Brandy 3 + 4          Sales
                                  Gin                        Figures


1       1996-97 63,984            0             63,984       1305295

2       1997-98 77,797            0             77,797       2054906

3.      1998-99 169,137           0             169,137      2503766

4.      1999-00 119,278           0             119,278      2814999

5.      2000-01 131,850           0             131,850      3422899

6.      2001-02 172,833           0             172,833      3522861

7.      2002-03 416,083           0             416,083      3582305

8.      2003-04 1,490,893         34,076        1,524,969 3434058


 9.      2004-05 2,492,084             266,503          2,758,587 3289323

10.     2005-06 3,420,021             445,310          3,865,331 3937777

11.     2006-07 4,295,077             477,928          4,773,005 5085367

12.     2007-08 7,528,763             226,441          7,755,204        ..

10. It was further urged that the appellant has obtained

registration of its trademark with a disclaimer of the word

„Choice‟ and hence could not appropriate the said word to the

exclusion of the others. Learned Senior Counsel urged that in an

action for passing off, in relation to a trade-mark which consists

of one or more than one words, normally the predominant focus

is on the prefix and not the suffix. With reference to the label

and the general get up of the bottles, it was urged that in the

past the appellant was using labels with a completely different

design and as time passed by and the respondent grew in the

market, the appellant started trailing the labels of the

respondent. Sh.Arun Jaitely learned Senior Counsel referred to

the literature relied upon by the appellant which showed that

due to some internal management problem, the sale of the

product of the appellant virtually stagnated and that of the

respondent grew by leaps and bounds. Sh.Arun Jaitely pointed

out that originally the appellant was selling its product in a

cylindrical bottle and the label had a distinct band in black colour

at the edges of the label. Right from the inception, the

respondent was selling its product in flat bottles and the label

was always having a golden colour band along the edges of the

label. Whereas the appellant was originally not having the

acronym „OC‟ on their product, the respondent had the said

letters as an acronym on its label and that the same was written

in an artistic form, more as a graphic representation of a symbol

and less as an acronym, evidenced by the fact that the letter „C‟

was encapsuled in the letter „O‟. It was as if „O‟ was carrying in

its womb „C‟.

11. It would be relevant to note that till an interim

arrangement was worked out on 17.9.2007, the appellant did not

have any injunction against the respondent with the result the

respondent was selling its product in different States. It appears

that as the respondent was intending to penetrate the market in

North India an interim arrangement was worked out and disposal

of the suit was expedited. Parties have recorded their evidence,

by and large, but because of the two suits getting stayed the

parties were compelled to argue on the issue of an interim

injunction as the foundation of the interim arrangement i.e. the

early disposal of the suits got shaken due to the suits being

stayed.

12. A word on the exercise of power in appeal against

interim orders passed by learned Single Judges on the original

side of the High Courts. Unless the mass of prima facie evidence

and the law compels the appellate Court to interfere with an

interlocutory order passed by the learned Single Judge exercising

discretionary jurisdiction, the appellate Court must respect the

view taken by the learned Single Judge. As long as the

discretion has been exercised reasonably, fairly, objectively and

keeping in view the principles of exercise of discretion, the

appellate Court is not required to reconsider the material which

was considered by the learned Trial Judge to find out whether an

alternative view was possible or whether the alternative view

was a better view.

13. The grievance of the appellant was to the

observations of the learned Single Judge in para 18 of the

impugned order wherein the learned Single Judge has observed

as under:-

"Without commenting on the question as to whether the mark „ORIGINAL CHOICE‟ is deceptively similar to the mark „OFFICER‟S CHOICE‟, as that is a question which will be gone into by the Court after the IPAB decision, a look at the label and bottle of the plaintiff on the one hand and the defendants on the other, does not give the impression that the defendants‟ bottle and label could be passed off as the plaintiff‟s bottle and label. It is not the minute details which have to be seen but the overall impression that is gained by looking at the two products. Taking a prima facie view in the matter, it does not appear to me as if the defendants‟ label and bottle could be passed off as that of the plaintiff‟s. Consequently, the very

first element of misrepresentation, which is essential for an action of passing off, is, prima facie, missing."

14. Sh.Sudhir Chandra, learned Senior Counsel for the

appellant urged that on the one hand the learned Single Judge

has unequivocally expressed that he was not commenting on the

question whether the mark „ORIGINAL CHOICE‟ was deceptively

similar to the mark „OFFICERS CHOICE‟ but in the next breath

has gone into the issue of deceptive similarity in a very cryptic

manner and has returned a finding against the appellant.

15. A re-reading of what has been expressed by the

learned Single Judge reveals that the learned Single Judge has

eschewed a discussion whether the mark „ORIGINAL CHOICE‟

was deceptively similar to the mark „OFFICERS CHOICE‟ in the

context, presumably, of phonetic and/or structural similarity in

the two marks. But has prima facie evaluated the trade dress

i.e. the bottles and the labels in which the whisky is marketed by

the appellant and the respondents to decide whether prima

facie, deception, which is an essential ingredient in an action for

passing off, existed or not. Thus, we find no contradiction.

16. Prima facie views have to be expressed with care and

without a deep analysis of the rival claims on merits for said

adjudication has to await the final trial. Final views have not to

be expressed at the interim stage lest parties are prejudiced at

the trial. The learned Single Judge has taken care to speak the

minimum because the appeal filed by the appellant before the

Intellectual Property Appellate Tribunal challenging the

registration of the trade-mark „ORIGINAL CHOICE‟ in favour of

the respondent is pending and the said tribunal could be

prejudiced if conclusive views were expressed by the learned

Trial Judge. No doubt, as observed by the Hon‟ble Supreme

Court in the decision reported as 1969 (2) SCC 727 Ruston &

Hornsby Ltd. Vs. The Zamindara Engineering Co. different

questions arise for consideration in an action for infringement of

a trademark and an action for passing off but the test as to

likelihood of confusion or deception arising from similarity of

marks is the same both in infringement and passing off actions.

In para 7 of the report it was observed that in an action for

infringement where the defendant‟s trademark is identical with

the plaintiff‟s mark, the Court will not inquire whether the

infringement is such as is likely to deceive or cause confusion.

But where the alleged infringement consists of using not the

exact mark on the register, but something similar to it, the test

of infringement is the same as in an action for passing off. Thus,

since the learned Single Judge was considering the plea at the

interim stage relatable to an action for passing off, the learned

Single Judge had to deal with the question of deception.

17. Even otherwise, a plea of acquiescence or delay in

bringing the action, set up as a defence, requires it to be

considered whether the interest of the public would be adversely

affected if the plaintiff is not granted an interim injunction on

account of acquiescence or inordinate delay in bringing an

action. It was so held by this Court in the decision reported as

2007 (35) PTC 59 (DEL) Pfizer Products Inc. Vs. Rajesh Chopra &

Ors.

18. We need not note the plethora of authorities on the

issue whether acquiescence or an inordinate delay in bringing an

action for injunction can non-suit the plaintiff. We note the latest

the pronouncement on the issue by the Hon‟ble Supreme Court

being the decision reported as 2008 AIR SCW 4560 Khoday India

Ltd. Vs. Scotch Whisky Asson. & Ors. It has been categorically

held that where acquiescence is established or there is an

inordinate delay in bringing an action for infringement of a trade-

mark or passing off, the discretionary relief of injunction may be

denied.

19. The sales figure of the product of the respondent

shows the growth of the respondent in the market since 1996.

That the appellant was aware that the respondent had entered

the market in the year 1995 stands established from the

opposition made by the appellant before the Excise

Commissioner Karnataka. Thus, the view taken by the learned

Single Judge that there has been an inordinate delay in bringing

the action and hence no interim injunction to be granted cannot

be faulted with.

20. The prima facie evaluation of the label used by the

appellant and the respondent is akin to the evaluation of a trade

dress. After all, when a product is sold in a container, be it a

pouch, a packet, a box or a bottle the issue of deceptive

similarity has to be considered with reference to the overall get

up of the container; of course the test of a reasonable or a

prudent person with imperfect memory relying upon his memory

to recollect the image of a product seen earlier and co-relating it

to the product before him while buying the product has to be

duly taken note of.

21. For the purposes of an interim relief we find

considerable merit in the plea of the respondent that the

appellant has trailed the respondent qua the get up of the label

and the shape of the bottle used by the respondent since

inception. We find that the appellant has been changing the

shape of the bottle and the get up of its label.

22. Law does not require to list out the similarities and

the dis-similarities by making a check list because the consumer

is not expected to do so while buying a product. The test is to

have a glance at the two competing labels and as a reasonable

and a prudent person forming an opinion whether there is a

chance of deception and/or confusion. Inherent in this test is the

cognitive faculties of a Judge impromptu telling the judicial mind

whether the imprints in the brain have resulted in a confusion.

23. Thus, we do not intend to go into the nitty gritties of

the two competing labels and hence we do not discuss in detail

the arguments advanced by Sh. Arun Jaitely learned senior

counsel for the respondent who took pains to bring out the

distinctive features in the two labels, as our cognitive faculties

did not leave us confused persons, rendering us vulnerable to be

deceived as claimed by the appellant.

24. Before concluding we may note that since the

question of deception has to be approached from the point of

view of a consumer of average intelligence and imperfect

recollection i.e. an ordinary person, common sense which is

nothing but a cluster of life‟s experiences comes into play.

25. For the reason a Judge may not have experienced the

purchase of "Officers Choice" or "Official Choice" or the

purchase of a peg of "OC", we recite the usual mantra. Nothing

stated by us would be construed as an expression on the merits

of the controversy. The learned Single Judge who would

ultimately decide the suit would obviously be guided by the

evidence of those who go to the market or sit in a bar to enjoy a

peg or two in the evening.

26. We find no infirmity in the view taken by the learned

Single Judge.

27. The appeals are dismissed with costs.

PRADEEP NANDRAJOG, J.

SUNIL GAUR, J.

SEPTEMBER 29, 2008 mm