Larsen And Toubro Ltd. vs Lakshmi Industrties & Anr.
2009 Latest Caselaw 3111 Del

20
*      IN THE HIGH COURT OF DELHI AT NEW DELHI

                                                               Judgment Reserved on 06.08.2009
                                                            Judgment Pronounced on: 11.08.2009

+                                     CS(OS) 686/2004

       LARSEN AND TOUBRO LTD.                                        ..... Plaintiff

                               Through : Ms. Purnima Sethi, Advocate.

                      versus

       LAKSHMI INDUSTRTIES & ANR.                                    ..... Defendents

                               Through : Nemo.


CORAM:
HON'BLE MR. JUSTICE S. RAVINDRA BHAT

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

2.     To be referred to Reporter or not?                    Yes

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

S.RAVINDRA BHAT, J.

1. The plaintiff sues for permanent injunction to restrain the defendants from using the

trademark 'LT' as it infringes their registered trademark 'L&T'.

2. The suit averments are that the plaintiff is the successor-in-business of a partnership firm,

M/s. Larsen and Toubro, formed by two Danish nationals, Henning Holck Larsen and Soren

Kristian Toubro in 1938 for the purpose of engineering business. It is claimed that as the

business grew, the concern was incorporated in 1946 and it took-over the affairs of the firm. It is

submitted that the plaintiff is also known by its acronym 'L&T' and identified by its logo

CS (OS) 686/2004 Page 1 wherein the two letters are distinctively placed within a circle. According to the plaintiff, the

mark has been used for more than five decades and appears in all its stationery, literature,

advertisements etc.

3. The plaintiff claims to have expanded and diversified its activities and formed

subsidiaries; all of these are described fully in para 6 of the suit. It relies upon the turn-over

figures which are set-out in para 8; its total turn-over for the years 2002-03 was Rs.10,124

crores, of which the profit before tax was Rs.510 crores. It is claimed that for the corresponding

period, the plaintiff's net worth was Rs. 3563 crores. The plaintiff adverts to its significant

advertisement campaigns conducted in the print and electronic media and details of these

expenses for the periods 1993-94 and 2002-03. In 1993-94, the expenses claimed are Rs.10

crores whereas for the period 2002-03, it is Rs.43 crores.

4. The plaintiff, in support of its claim for being longstanding user of the trademark relies

upon the Annual Reports published during the periods 1946-47, 1999-2000 as well as the Annual

Report for the period 2002-03. It further relies upon an advertisement issued on its behalf, which

discloses use of the mark, as far back as on 14.01.1975; it is an advertisement published in the

Financial Times.

5. The plaintiff avers to defendants having dishonestly adopted its logo and trying to get the

mark registered. The plaintiff claims to have become aware of this in the third week of April

2004 when it was informed about the defendant's logo. The plaintiff has also produced a copy of

the Trademark journal dated 25.11.2003 (Ex.PW-1/3) containing defendant's proposed mark

'Li', which it submits is almost identical with its (the plaintiff's) mark, 'L&T', as the letters are

placed in the same manner within a similar circle. The plaintiff claims that its mark is well-

known as it has distinctiveness due to its logo and also in respect of the quality of services

CS (OS) 686/2004 Page 2 rendered by it. It submits that its logos are printed on all its products, cartons, boxes, containers

etc. with its name 'LARSEN & TOUBRO'. It describes the mark in the following terms:

(a) In L&T's logo, the letters 'L' and 'T' are put together, the letter 'L' placed little above

the left side of the letter 'T';

(b)     The letters 'L' and 'T' are put inside a full circle;

(c)     The letters 'L' and 'T' are written in 'italics' and in capital letters;

(d)     The brand name 'LARSEN & TOUBRO' is usually written or printed on all the

Plaintiff's products in capital letters.

6. According to the plaintiff, the defendants have adopted a phonetically identical and

structurally similar mark to the 'L&T' logo with the letter 'L' place d on the upper left side of

the letter 'T', both written in capital italics, within a circle. The defendants' use of the mark, it is

alleged, is entirely dishonest and solely with the purpose of misusing the plaintiff's well-

deserved reputation. The defendants' products are television parts, tape recorders, decks, voltage

stabilizers, electric transformers, wires, cables, electrical fittings and accessories; it is submitted

that the plaintiff also is engaged in a similar trade.

7. The defendants, despite service of summons, did not enter appearance; they were set-

down ex-parte by an order dated 25.07.2006. The plaintiff's witness, Mr. K.R. Palta deposed

through an affidavit affirmed on 17.04.2007; it was accompanied by 11 exhibits. Essentially,

these proved documents were filed along with the list at the time the suit was filed in Court. The

said witness affirmed about the affidavit and proved it as Ex. 1/A, on 08.08.2007.

8. The plaintiff has referred to various judgments of the Courts, including the Supreme

Court, on the question of distinctiveness of trademarks and the claim of another entrant seeking

use of similar mark, even if the goods are separate. Reliance was placed upon the decisions

CS (OS) 686/2004 Page 3 reported as Larsen & Toubro Ltd. v. Lachmi Narain Trades & Ors. 2008 (36) PTC 223 (DB);

Kirloskar Diesel Recon (P) Limited v. Kirloskar Proprietory Limited AIR 1994 (Bom) 242;

Mahendra & Mahendra Paper Mills Limited v. Mahindra & Mahindra Limited 2002 (2) SCC

147; Sunder Parmanand Lalwani and Ors. v. Caltex (India) Limited AIR 1969 (Bom) 24, and

Laxmikant. V. Patel v. Chetanbhai Shah and Anr. 2002 (3) SCC 65.

9. The Court has carefully considered the materials on record and the submissions made by

the plaintiff. The pleadings and the deposition of PW-1 establish that the mark, which is based on

the acronym 'L&T' originated from the two partners of the predecessor firm established

sometime in 1938. That firm was subsequently corporatized; the plaintiff has been functioning

for over five decades. The plaintiff has been able to demonstrate - as may be seen from PW-1/5,

the advertisements that the mark has been known and used in the print media for more than 35

years; copies of the Annual Reports (PW-1/4 series) also corroborate this position. The plaintiff

has spent considerable amounts towards its advertisement expenses, for creating brand

consciousness about its diverse products. Though it initially was engaged in engineering

business, it appears to have diversified into service industry and is also involved in the

manufacture of other products. The defendants appear to have applied for registration of its mark

- impugned in these proceedings - in 2003; the Trademark journal extract dated 25.11.2003 (Ex.

PW-1/8) claims user of the mark since 01.04.1992, in respect of wires and cables, including PVC

cables, in class-9. The plaintiff apparently had resisted the registration and filed its opposition on

26.05.2004.

10. The plaintiff, in the opinion of the Court, has been able to establish that its mark is widely

known in the trade and even acquired distinctiveness; it has also shown that its business has

grown manifold and its subsidiaries were established for carrying-on diverse activities. In

CS (OS) 686/2004 Page 4 relation to the name-based marks, the Bombay High Court, in Kirloskar Diesel Recon (P)

Limited (supra) stated that:

" XXXXXXX XXXXXX XXXXXX

14. In the case of trading name which has become almost a household word and under which trading name a variety of activities are undertaken, a passing off can successfully lie if the defendant has adopted identical or similar trading name and even when the defendant does not carry on similar activity. Even if the defendant‟s activities in such circumstances, are remote, the same are likely to be presumed a possible extension of plaintiff‟s business or activities.

XXXXXXX XXXXXX XXXXXX

18. In passing off action, the plaintiff is not required to establish fraudulent intention on the part of the defendant and as such, it was not necessary for the respondents to establish fraudulent intention on the part of the appellants in incorporating the word „Kirloskar‟ as part of corporate names of 1st appellant in each of the appeals. It was even not necessary for the respondents to prove causing of actual confusion amongst the customers or public at large by the appellants adopting the word „Kirloskar‟ as part of corporate names of 1st appellant in each of the appeals. What the respondents were required to establish, which the respondents have established, is a likelihood of deception or confusion..............

XXXXXXX XXXXXX XXXXXX"

11. Similarly, in the judgment in Mahendra & Mahendra Paper Mills Limited (supra), the

Supreme Court, while quoting the Kirloskar Diesel Recon Private Limited (supra) held that:

XXXXXXX XXXXXX XXXXXX

"Without intending to be exhaustive some of the principles which are accepted as well settled may be stated thus: that whether there is a likelihood of deception or confusion arising is a matter for decision by the court, and no witness is entitled to say whether the mark is likely to deceive or to cause confusion; that all factors which are likely to create or allay deception or confusion must be considered in combination; that broadly speaking, factors creating confusion would be, for example, the nature of the market itself, the class of customers, the extent of the reputation, the trade channels, the existence of any connection in course of trade, and others."

               XXXXXXX               XXXXXX                 XXXXXX"



CS (OS) 686/2004                                                                              Page 5

12. The judgment in Larsen & Toubro Ltd. v. Lachmi Narain Trades & Ors. concerned use

of the marks 'LNT‟ and „ELENTE‟. The Division Bench of this Court, relying upon Mahendra &

Mahendra Paper Mills Limited (supra) as well as the other judgments on the issue negatived the

defence and held that dissimilarity in some of the products, which the parties to the litigation

dealt with, did not make any difference so far as grant of relief was concerned. It was further

held that the mark 'L&T' had acquired distinctiveness and was entitled to protection.

13. The above judgments establish that where an individual or a business concern, in the

lawful exercise of its right to trade, creates and uses a distinctive mark with which its goods and

services are associated, the goodwill in such brands is created over a period of time; the law

typically concerns the distinctive claims of such service providers and the need to give protection

to such marks. A peculiarity in this branch of property law is that the mark in question becomes

so intrinsically associated with the product and its quality that it denotes a reputation which the

consumer expects of the products. If such marks are copied by others - whether in the same trade

or in relation to other products and services - often the question the Court is confronted with is

whether dilution occurs. In the case of strong marks, where the consumer is aware of the

excellence in the reputation of goods, use of a distinctive mark by someone else, in relation to

even unrelated goods may result in dilution of brand and consequential reputation, thereby

resulting in injury to the trademark owner.

14. In this case, the plaintiff has been able to establish that its mark 'L&T' has been used

distinctively for about five decades and has been known in the public domain for at least about

35 years; its reliance on the Annual Reports placed on the record also establish that sales figures

have risen steadily and that it carries out diverse activities through its subsidiaries. The

defendants' use of the letters 'L' and 'T', placed together in a deceptively similar manner as that

CS (OS) 686/2004 Page 6 of the plaintiff, within one or use of any other letters in combination 'L' (such as 'L' and 'I') in a

similar manner would inevitably result in a striking resemblance and consequent confusion about

the defendants' goods being those of the plaintiff. In these circumstances, the plaintiff has been

able to prove that the defendants have unjustifiably used the mark 'L&T' in a confusingly similar

manner and sought to pass it off as their own.

15. Though the plaintiff made a claim for damages in excess of Rs.22 lakhs, no meaningful

evidence has been led to establish that the defendants' use of the mark has led to any injury of

the kind that would persuade the Court to grant such amounts. In the circumstances, the plaintiff

would be entitled to some nominal amount.

16. In view of the above discussion, the suit is entitled to succeed. The defendants, their

servants, agents, employees etc. are hereby permanently restrained by perpetual injunction from

using, in relation to their business, service, goods or products (mentioned in para 32(a) of the

Suit), any mark containing the letters 'L' and 'T' written in a circle or in any other deceptively

similar logo or mark as that of the plaintiff as to result in passing off their products or goods as

that of the plaintiff's goods or services. The plaintiff is also entitled to nominal damages,

quantified at Rs.50,000/-, payable by the defendants.

17. CS (OS) 686/2004 is decreed in the above terms with costs.

                                                                            S. RAVINDRA BHAT
                                                                                       JUDGE
       AUGUST        11, 2009
       'ajk'




CS (OS) 686/2004                                                                               Page 7