Pernod Ricard, Sa & Anr vs Real House Distillery Pvt. Ltd. & ...
2009 Latest Caselaw 5195 Del

*            HIGH COURT OF DELHI : NEW DELHI

+          I.A. No. 12700/2008 and I.A. No. 16299/2009 in CS (OS)
           No. 2203/2008


     Pernod Ricard, SA & Anr.                            ...Plaintiffs
                     Through : Mr. Hemant Singh with Mr.
                               Sachin Gupta, Mr. Shashi P.
                               Ojha and Mr. Animesh Rastogi, Advs.

                                 Versus

     Real House Distillery Pvt. Ltd. & Anr.            ...Defendants
                     Through : Mr. Pallav Shishodia, Sr. Adv.
                                  with Mr. Hemant Sharma, Adv.

Reserved on : September 24, 2009
Decided on : December 15, 2009

Coram:

HON'BLE MR. JUSTICE MANMOHAN SINGH

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

2. To be referred to Reporter or not?                             Yes

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

MANMOHAN SINGH, J.

1. The present applications under consideration being I.A. No.

12700/2008 filed on behalf of the plaintiffs under Order XXXIX Rules 1

and 2 read with Section 151 of the Code of Civil Procedure, 1908

(referred to as the CPC for brevity) for grant of injunction restraining

the defendants, their directors, assignees, distributors and dealers from

manufacturing, selling, offering for sale, advertising or directly or

indirectly dealing in alcoholic beverages and/or allied goods under a

label similar to the plaintiffs‟ registered trademark label and I.A. No.

16299/2009 filed by the defendants under Order VII Rule 11 of the CPC

for rejection of the plaint shall both be disposed of by this order.

2. The brief facts of the present case are that plaintiff no. 1 is a

company duly incorporated under the laws of France having its

registered office at 12, place des Etats-Unis, 75016 Paris, France and

plaintiff no. 2 is a wholly owned subsidiary of plaintiff no. 1 having its

registered office at 104, Ashoka Estate, Barakhamba Road, New Delhi-

110001.

3. The plaintiff no. 1 was formed in 1974 as a result of the

merger of Pernod SA and Ricard SA, both being France‟s largest

suppliers and distributors of aniseed beverages. Since then, the Pernod

Ricard Group has seen unprecedented revenue and fame, with over 100

production facilities throughout the world and turnover to the tune of €

6.4 billion in 2006-2007.

4. The products of plaintiff no. 1 are world renowned and are

sold under the names Chivas Regal, Ballantine‟s, 100 Pipers, The

Glenlivet, Beefeater, Wild Turkey, Jameson, Jacob‟s Creek, Martell,

Malibu, Kalhua, Havana Club, G.H. Mumm, Passport, Something

Special etc.

5. The sale of the plaintiff no. 1‟s beverages and promotional

expenses in India are reproduced hereinbelow :

 Year              Volume (in Litres)       Promotional Exp. (in Euros)

 2006              1683                     1000



  2007                2142                    3000

 2008                3222                    7000

6. The superlative quality of the plaintiff no. 1‟s beverages are

stated to lie in its recipe, which was formulated by Mr. Paul Ricard in

1932 and the raw ingredients for which have to be gathered from remote

corners of southern China, the Valley of river Euphrates in Syria and the

Mediterranean.

7. The products of the plaintiffs are marked with a logo which is

claimed to be unique, distinctive and impressionable and has been

registered under no. 485913 as RICARD label mark in class 33 on 16th

February, 1988 as well as under registration no. 1362075 in class 33 on

7th June, 2005. The logo comprises of the following features :

(a) the logo comprises of stylized acanthus leaves with silver background and blue leafy outline;

(b) a circular device having red background and blue border with the numeral "45" in white colour is depicted upon the central section of the shield device;

(c) a set of swirling scrolls of silver ribbons with blue borders unfold outwardly from either side of the red circular device with "APERITIS" and "ANISE" printed thereon in blue bold letterings.

8. The essential features of the RICARD label are the

following :

(a) the vertically elongated label comprises a colour combination of white, blue, silver and red;

(b) the label has an overall white background with two broad blue bands appearing upon the upper and lower sections, each having a silver and blue thick border;

(c) the trade mark RICARD appears in thick and bold white letterings against blue background upon the upper blue band whereas "FRANCE" appears in interspersed white bold letterings upon the lower blue band;

(d) the central section of the label has a white background with thin silver vertical pin stripes, upon which the RICARD logo as described hereinabove is depicted;

(e) the lower section below the blue band contains descriptive matters in blue and red letterings against white background.

9. It is the plaintiffs‟ submission that the RICARD logo and

label have become distinctive of the plaintiffs‟ product and both

constitute original „artistic works‟ within the meaning of Section 2(c) of

the Copyright Act, 1957 and the plaintiffs alone have the right to use and

reproduce the logo/label and/or any features thereof in any material form

and any colourable imitation or substantial reproduction of essential

features thereof by unauthorized persons would be a civil wrong as well

as a criminal wrong, being infringement of copyright under Sections 63

and 64 of the Copyright Act.

10. The plaintiff no. 1 has claimed protection in India as it is a

French Corporation and France is a signatory to and member of the

Berne Convention. Further, the products of plaintiff no. 1 are imported

and marketed in India by plaintiff no. 2.

11. The plaintiffs have contended that the goodwill and

reputation that vests in the RICARD logo and label has been earned and

created over decades of hard work, huge financial investments,

painstaking quality control etc. The said mark, which was modified in a

miniscule manner in 2002 is invaluable to the plaintiffs, as are the

intellectual property rights vesting in it. According to the plaintiffs, the

essential features of the logo and label have remained the same since the

beginning despite certain minor modifications.

12. According to the plaintiffs , in and around the first week of

September 2008, the plaintiffs became aware that the defendants were

selling/ offering for sale whisky produced by them under the trademark

REAL. However, the trade dress, logo and label of the defendants‟

product were a spot on imitation of the plaintiffs‟ product.

13. The plaintiffs employed a private investigator Mr. R.K.

Sharma to verify the whereabouts of the manufacturer of the REAL

product as they had no information about the same. It was found out that

the manufacturers were manufacturing and selling products with the

infringing label and logo in Goa and both the defendants are located in

Goa.

14. It is the plaintiffs‟ case that the defendants are using a logo

and label which has all the distinguishing features of the plaintiffs‟ label

and logo. The infringing logo/label has the same essential visual

components as the plaintiffs‟ logo/label. The plaintiffs‟ product is sold

worldwide and its trademark is recognized worldwide, and in fact in

India, its trademark has been registered since 1988 and its infringement

is a violation under Section 29 of the Trademarks Act, 1999. The said

logo/label has also become a „well known‟ trademark within the

meaning of Section 2 (1) (zb) of the Trademarks Act.

15. The plaintiffs have contended that the defendants have

diluted and blurred the distinctiveness of the plaintiffs‟ trademark/brand

name. The doctrine of dilution by blurring has been propounded by the

plaintiffs thus. If one small user can blur the sharp focus of the famous

mark to uniquely signify one source, then another will also do so.

Eventually a point will come when significant injury is caused by the

cumulative effect of such blurring. When the plaintiffs‟ logo and label

will be seen by customers on products having no connection with the

plaintiffs, the uniqueness and distinctiveness of their logo and label will

be diluted.

16. The acts of the defendants, as per the plaintiffs, constitute an

act of unfair competition as the defendants‟ use of a label which is

deceptively similar to the plaintiffs‟ label, and that too for the sale of

alcohol which is not manufactured or marketed by the plaintiffs, is only

for financial gain by taking undue advantage of the investment incurred

by the plaintiffs in setting up the brand equity built up by the plaintiffs.

17. It is submitted by the plaintiffs that the defendants are

intentionally misappropriating the goodwill built by the plaintiffs over

the last 75 years and the adoption of a similar label is a deliberate

attempt aimed at deriving unlawful and unethical benefit of the

plaintiff‟s reputation. Continuation of such misappropriation would

result in irreparable injury to the plaintiffs.

18. The plaintiffs have also contended that aside from injury to

them, the acts of the defendants are causing injury to the public at large

as the said public is being misled into purchasing low quality liquor

being sold by the defendants, though thinking all the while that they are

purchasing the plaintiffs‟ refined and high quality product.

19. In order to prove the case, the plaintiffs have filed the prima

facie evidence, i.e. registration certificate of the mark which is registered

in Class 33 in respect of alcoholic beverages, sale invoices in India and a

print out from the search engine giving the history of plaintiff no. 1 and

also the distinctive logo which has been used in various overseas

countries since 1932 wherein the essential features referred by the

plaintiffs in the plaint remained the same as of today, therefore, the

contention of the defendant as regards the modified label of the plaintiffs

not being registered is without any substance and is therefore rejected.

20. In their reply to the application for interim injunction, the

defendants have submitted at the outset that an order was passed by this

court on 16th December, 2008 directing the defendants to not place any

further order for printing of the disputed labels. The defendants were

permitted to use the earlier labels and sell their products with such labels

before 31st December, 2008. After that, the defendants were permitted to

sell their products under a new label shown in court on that date. The

court however, clarified that such permission did not imply acceptance

of the defendants‟ stand or of the new label.

21. The defendants have submitted that as per the said order, they

discontinued the use of the infringing label and are now using the new

label as shown to the court. The defendants have contended that the

labels which are the subject matter of the dispute are being used by the

defendants since 1974 and the plaintiffs‟ application ought to be rejected

for this reason itself.

22. Another contention of the defendants is that the plaintiffs‟

brand RICARD was unknown in India, including in the State of Goa

where the defendants function and operate, prior to the year 2009. It is

also the defendants‟ submission that the modified label of the plaintiffs

(modified in 2002) has not been registered in India.

23. The case of the defendants is that neither defendant no. 1 nor

defendant no. 2 distribute or manufacture any alcohol beverages and/or

aperitif/anise based beverages similar to the plaintiffs‟ product. The

defendants are submitted to be part of the Real Group of Companies

which was established by late Mr. Gajanan Shirodkar by setting up a

restaurant by the name of „Cafe Real‟ at Panaji, Goa.

24. Thereafter, Mr. Shirodkar expanded his business by including

various companies under his banner, all of which had the prefix „Real‟

and logo „R‟ and a crown and which dealt with various things such as

aerated drinks, watches, toiletries, watches, cosmetics etc. In and about

1974, Mr. Shirodkar started the manufacture of Palm Feni and Cashew

Feni (local drinks in Goa) for sale only in Goa. In 1977, Indian Made

Foreign Liquors like whisky, brandy, rum and wines were manufactured

with the name „Real‟ and under the distinctive mark of „R‟ with a crown.

The manufacture of wines was discontinued from 2007.

25. The defendants have submitted that the sale of other liquors,

under the different labels approved by the Department of Excise, has

been on-going and also that these liquors are completely different from

the plaintiffs anise flavoured aperitifs/beverages.

26. The defendants have submitted that as far the customers are

concerned, no customer would buy the defendants‟ whisky mistaking it

for the plaintiffs‟ aperitif as both products are very dissimilar. Further,

the said label is being used by the defendants since 1977 in Goa and the

plaintiffs started the import of their product in Goa as late as in 2001.

Further, the plaintiffs‟ product is available in the State of Goa for Rs.

1300/-, whereas the „Real Whisky‟ being sold by the defendants costs

Rs. 59.50/-.

27. During the pendency of the interim application, this Court on

16th December, 2008 passed the following order :

"On 19th November, 2008, counsel for the defendants had made a statement that they shall not place any further order for printing of disputed labels in question. The said order has continued. The defendants are permitted to use the earlier labels and sell their products on or before 31st December, 2008. After the said date, the defendants can market their products under the new label shown in Court today, which is in blue/purple colour and white. However, it is clarified that this does not mean that this Court has accepted the stand of the defendants or the new label produced today in Court."

28. The defendants have filed various documents along with the

list of documents dated 16th July, 2009 including a true copy of a

certificate of incorporation of the defendants‟ company, letter of

registration dated 30th April, 2003 with regard to the defendants‟ labels

as well as renewal memorandums of the said labels issued by the Excise

Commissioner‟s office for the years 2004-2007.

29. The defendants have also filed nine affidavits of persons in

the same trade who have stated that they are engaged in the sale of the

defendants‟ products and that the same are sold within Goa as well as the

fact that there has been no promotion of the plaintiffs‟ beverages in Goa

and the said products are not available in Goa. However, no specific

statement has been made to the effect that they have been purchasing the

defendants‟ goods which are bearing the old label, on the basis of which

subject matter the present suit has been filed and if they are doing so,

there is no exact date of purchasing the product under the label/mark

under complaint.

30. The counsel for the defendants also handed over few

documents during the hearing of the interim application in order to show

that the label which is subject matter of the suit was approved by the

Excise department for the more than a decade. The learned senior

counsel for the defendants, although did not give up the use of the label

which is the basis of the subject matter of the suit, but restricted his

submission mainly to the amended label which was allowed by this court

temporarily by order dated 16th December, 2009.

31. Learned counsel for the plaintiffs has made the statement that

the plaintiffs are not pressing the relief of passing off as well as

infringement of copyright as claimed in the suit and this court may

determine the interim application while considering the case of the

plaintiff, merely confining itself to the relief of infringement of

trademark/label, which is duly registered in favour of the plaintiffs.

Although there are averments made by the plaintiffs in respect of the

case of infringement of copyright and passing off, however, in view of

the statement made in the court, there is no need to discuss the said

rights claimed by the plaintiffs.

32. During the course of the hearing the defendants filed an

application under Order VII Rule 11 of the CPC being I.A. No.

16299/2009. At this point, I shall first deal with this application.

I.A. No. 16299/2009

33. In the said application, the defendants have prayed for

dismissal of the plaint on the basis of lack of territorial jurisdiction of

this court and to try the present suit as the defendants do not carry on

business within the jurisdiction of this court as both the companies have

their registered offices at Goa and they manufacture, market and sell

their products within Goa.

34. The plaintiffs have invoked the territorial jurisdiction of this

court by stating that it has jurisdiction to try the present suit in view of

para 23 of the plaint which reads as under :

"This Hon‟ble Court has the jurisdiction to entertain and try the present suit under the provisions of Section 62 (2) of the Copyright Act, 1957 and Section 134 of the Trade Marks Act, 1999 since the plaintiffs are carrying on business at Delhi through Plaintiff no. 2 located at 104, Ashoka Estate, Barakhamba Road, New Delhi - 110001."

35. It is well settled law that in order to determine an application

under Order VII Rule 11 of the CPC, the court has to consider the

averments made in the plaint. In the present case, in para 23 of the

plaint, the territorial jurisdiction has been invoked by the plaintiffs

mainly on the reasons that the plaintiffs are carrying on business in

Delhi and under Section 134 (2) are entitled to take the benefit of said

provision for the purpose of territorial jurisdiction.

36. In the case of Mayar (H.K.) Ltd. v. Owners & Parties, Vessel

M.V. Fortune Express,(2006) 3 SCC 100, the Supreme Court, with

regard to the scope of an application under Order VII Rule 11 observed

as under :

"12. From the aforesaid, it is apparent that the plaint cannot be rejected on the basis of the allegations made by the defendant in his written statement or in an application for rejection of the plaint. The court has to read the entire plaint as a whole to find out whether it discloses a cause of action and if it does, then the plaint cannot be rejected by the court exercising the powers under Order 7 Rule 11 of the Code. Essentially, whether the plaint discloses a cause of action, is a question of fact which has to be gathered on the basis of the averments made in the plaint in its entirety taking those averments to be correct. A cause of action is a bundle of facts which are required to be proved for obtaining relief and for the said purpose, the material facts are required to be stated but not the evidence except in certain cases where the pleadings relied on are in regard to misrepresentation, fraud, wilful default, undue influence or of the same nature. So long as the plaint discloses some cause of action which requires determination by the court, the mere fact that in the opinion of the Judge the plaintiff may not succeed cannot be a ground for rejection of the plaint. In the present case, the averments made in the plaint, as has been noticed by us, do disclose the cause of action and, therefore, the High Court has rightly said that the powers under Order 7 Rule 11 of the Code cannot be exercised for rejection of the suit filed by the plaintiff-appellants."

37. Yet in another case of Manmohan Singh Chawla Vs.

Rajesh Berry & Anr., 2009 (3) AD (Delhi) 259, a division bench of this

court held as under :

"14. We have given our utmost consideration to the aforesaid submissions with reference to the record. It is not in dispute and even the parties were at ad idem that while considering the application under Order VII Rules 10 and 11 of the Code averments made in the plaint and plaint alone are to be seen. At this stage the Court cannot go into the defence of the defendants contained in the written statement or the documents filed by the defendants."

38. The question of territorial jurisdiction in similar

circumstances has been discussed by this court in various matters. In the

case of LG Corporation & Anr. Vs Intermarket Electroplasters(P)

Ltd. and Anr., 2006 (32) PTC 429, following observations were made

in para 7 :-

"The question as to whether the Court has territorial jurisdiction to entertain a suit or not has to be arrived at on the basis of averments made in the plaint, that truth or otherwise thereof being immaterial as it cannot be gone into at this stage.....""

39. In Tata Iron & Steel Co. Ltd. V. Mahavir Steels & Ors.;

47(1992) DLT 412 it was observed in para 11 as under :

"11. .... The question regarding jurisdiction can only be gone into after the evidence of the parties is recorded in the case. Even in the Punjab case the suit was not thrown out at the threshold under Order 7 rule 11 Civil Procedure Code but only after the parties were given an opportunity to lead evidence. The plaint in the present suit categorically states that defendant No. 1 was selling the channels of defendant No.2 under the offending trade mark which is deceptively similar to that of the plaintiff. On these averments the court

must assume jurisdiction and proceed with the suit to determine the question relating to the confirmation/vacation of the slay order at this stage."

40. As per the well settled proposition of law stated in the

preceding paras, I am of the view that prima facie, this court has the

jurisdiction to try the present suit under Section 134 (2) of the Trade

Marks Act, 1999 as the plaintiff No.2 is a subsidiary of Plaintiff No.1

who has its registered office at New Delhi from where the plaintiffs are

carrying on their business. Further, it is mixed question of law and facts.

In view of the above said observation, the defendants‟ application under

Order VII Rule 11 is dismissed being not maintainable.

41. Now, I shall deal with the contentions of the parties with

regard to the interim application being I.A. No.12700/2008.

42. Before dealing with the point of infringement of the trade

mark and exclusive rights of trade mark in question as alleged by the

plaintiff No.1. It is not a disputed fact that the plaintiff no. 1 is the

registered proprietor of the trade mark RICARD label, which has the

essential feature of the logo as well as the other features of the label

mentioned in para 8 of this order. According to the plaintiff, the said

essential features are being used in many overseas countries since the

year 1932. The plaintiffs have submitted that the said features are

distinctive and exclusively associated with and denotes and connote the

products of the plaintiff and no one else. Before dealing with the same, I

would simply like to refer the pictures of the product of both the parties,

which are shown below :

            Plaintiffs' label              Defendants' old label

Infringement of Trade Mark

43. It is undisputed fact that the label used by the plaintiffs with

the distinctive features mentioned in para 5 of the judgment was

registered under the Trade and Merchandise Act, 1958 in India in 1988.

As per the settled law, it is immaterial in case slight changes or

modifications are made in the label, so long as the substantive features

remain the same.

44. Under Section 28 of the Act, the plaintiffs have exclusive and

statutory rights to use to same in relation to goods in which the mark is

registered. Under Section 31 of the Act, registration is prima facie

evidence of a mark‟s validity. The proviso of Section 10 of the Trade

Marks Act, 1999 lays down that if the trade mark is registered without

limitation of colour, it shall be deemed to be registered for all colours.

45. It is not disputed in law that in an action for infringement the

plaintiff can succeed not only when he proves that the whole of his

registered trade mark has been copied but can also succeed if he shows

that the defendant's mark is similar to the plaintiff's mark as it would be

remembered by persons possessed of an average memory with its usual

imperfections or that its essential particular or the distinguishing or

essential feature has been copied. In the present case, undisputedly, the

plaintiff no. 1 has got the exclusive right by virtue of registration.

Exclusive rights of plaintiff no. 1

46. In the case of Kaviraj Pandit Durga Dutt Vs Navaratna

Pharmaceutical, AIR 1965 SC 980 (at 989 and 990), it was held as

under :

"In an action for infringement the plaintiff must, no doubt, make out that the use of the defendant„s mark is likely to deceive but where the similarity between the plaintiff„s and the defendant„s mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is an imitation, no further evidence is required to establish that the plaintiff„s rights are violated."

47. In the case of American Home Products Vs Mac

Laboratories, AIR 1986 SC 137 in Para 36 it was held as under :

"When a person gets his trade mark registered, he acquires valuable rights by reason of such registration. Registration of his trade mark give him the exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or deceptively similar to his trade mark, he can protect his trade mark by an action for infringement in which he can obtain injunction......."

48. In the case of National Bell Co. Vs Metal Goods Mfg. Co.,

AIR 1971 SC 898 at page 903 it was held as under :

"On registration of a trade mark the registered proprietor gets under section 28 the exclusive right to the use of such trade marks in relation to the goods in respect of which the trade mark is registered and to obtain relief in respect of any infringement of such trade mark."

49. In the case of Avis International Vs Avi Footwear, AIR

1991 Delhi 22 at Page 25 Para 21 it was observed :

"In my view violation of the exclusive statutory rights is illegal activity, to hold otherwise will negate the statutory provisions of the Trade and Merchandise Marks Act."

INFRIGEMNENT OF TRADEMARK

50. In the case of James Chadwick & Bros. Lid. v. The

National Sewin" Thread Co. Ltd., MANU/MH/0063/1951 the Court

ruled as under :

"in an action for infringement what is important is to find out what was the distinguishing or essential feature of the trade mark already registered and what is the main feature or the main idea underlying the trade mark. In Parle Products (f) Ltd. v. J. P. & Co. Mysore. :

MANU/SC/0412/1972 the Supreme Court took the same view."

51. In the judgment of the Supreme Court in Ruston and

Hornby Ltd. v. Zamindara Engineering Co., MANU/SC/0304/1969.

The Supreme Court held that an infringement of a registered trade mark

takes place not merely by exact imitation but by the use of a mark so

nearly resembling the registered mark as to be likely to deceive.

52. In the case of Taw Manufacturing Coy. Lid. v. Notek

Engineering Coy. Ltd. and Anr., (1951) 68 Reports of Patent Cases

271(2), where the two pictures of the respective parties which are

scanned and shown as under were in dispute:-

It was held that the monopoly claimed under the registered

trade mark related to Motor Lamps and consisted of a pictorial device

and the word "Taw". The device comprised of a representation of the

full-faced view of a cat's head, wherein the eyes were drawn in the form

of motor car headlamps and the whole picture was superimposed upon

an open body motor car viewed from the front in a manner so as to

substitute the cat's head for the bonnet and radiator as normally seen.

The device that was the subject matter of challenge consisted of a square

panel with informative particulars printed below. The panel depicted a

full-faced view of a cat's head with the eyes drawn as motor car

headlamps, beneath which was the caption ''Let Notek be your eyes in

fog and darkness". The disposition and lettering was such as to lead the

reader to take particular notice of the device with the word "Notek"

beneath it. The question for decision was whether there was

infringement by the latter device of the former registered trade mark and

the Court held as under :

"A trademark is infringed if a person other than the registered proprietor or authorised user uses, in relation to

goods covered by the registration, one or more of the trademark‟s essential particulars. The identification of an essential feature depends partly upon the Court‟s own judgment and partly upon the burden of the evidence that is placed before the Court."

53. As observed by the Privy Council in De Cordova and

others Vs. Vick Chemical Company, 68 R.P.C. 103, 106 it was held as

under :

"It has long been accepted that, if a word forming part of a mark has come in trade to be used to identify the goods of the owner of the mark, it is an infringement of the mark itself to use that word as the mark on part of the mark of another trader, for confusion is likely to result."

54. In M/s. Atlas Cycle Industries Lid. v. Hind Cycle Limited,

ILR 1973 Delhi 393 this Court held :

"In an action for an alleged infringement of a registered trade mark, it has first to be seen whether the impugned mark of the defendant is identical with the registered mark of the plaintiff. If the mark is found to be identical, no further question arises, and it has to be held that there was infringement. If the mark of the defendant is not identical, it has to be seen whether the mark of the defendant is deceptively similar in the sense it is likely to deceive or cause confusion in relation to goods in respect of which the plaintiff got his mark registered. For that purpose, the two marks have to be compared, 'not by placing them side by side. but by asking itself whether having due regard to relevant surrounding circumstances, the defendant's mark as used is similar to the plaintiff's mark as it would be remembered by persons possessed of an average memory with its usual imperfections', and it has then to be determined whether the defendant's mark is likely to deceive or cause confusion".

55. In view of the above stated law on the subject, there is no

hesitation in coming to the conclusion that the logo and label used by the

defendants is almost similar and is a slavish copy of the plaintiffs‟ logo

and label. It appears that the defendants have copied the plaintiffs‟ label

feature by feature, except that the trademark is different in the present

case. In the present case, as alleged earlier, the plaintiff No.1 has the

exclusive rights by virtue of registered mark and in case they are

violated by the party, the case of infringement is made out.

Price Factor

56. The defendants‟ contention that the huge price difference in

the products of the parties will not lead to deception cannot be accepted

in view of the judgment passed in Whirlpool Co. & Anr. Vs. N.R.

Dongre & Ors., 1996 (16) PTC 415 (Del) wherein a similar contention

of the defendant regarding the vast difference in the price of the goods

was rejected. In Tata Oil Mills Co. Ltd. Vs. Wipro Ltd. & Anr., 1986

(6) PTC 358 (Del), it was clearly held in para 20 of the judgment that

the difference in price of the two goods under scrutiny shall be irrelevant

while comparing the said marks.

Delay

57. Though the defendants have not produced cogent evidence to

prove the user claimed, however, prima facie, it appears that the

defendants must have been using the old label for more than a decade.

Since this court has already held that the said label is an infringement of

the plaintiffs‟ registered trademark, now, the point which arises for

consideration is as to whether the defendants are entitled to any benefit

or not.

58. In the case of Hindustan Pencils (P) Ltd. Vs. India

Stationery Products Co. and Anr., AIR 1990 Delhi 19, the following

observation was made vis-à-vis delay and laches :

"31. Even though there may be some doubt as to whether laches or acquiescence can deny the relief of a permanent injunction, judicial opinion has been consistent in holding that if the defendant acts fraudulently with the knowledge that he is violating the plaintiff's rights then in that case, even if these is an inordinate delay on the part of the plaintiff in taking action against the defendant, the relief of injunction is not denied. The defense of laches or inordinate delay is a defense in equity. In equity both the parties must come to the Court with clean hands. An equitable defense can be put up by a party who has acted fairly and honestly. A person who is guilty of violating the law or infringing or usurping somebody else's right cannot claim the continued misuse of the usurped right. It was observed by Romer, J. in the matter of an application brought by J.R Parkington and Coy. Ld" 63 R.P.C. 171 that "in my judgment, the circumstances which attend the adoption of a trade mark in the first instance are of considerable importance when one comes to consider whether the use of that mark has or has not been a honest user. If the user in its inception was tainted it would be difficult in most cases to purify it subsequently". It was further noted by the learned Judge in that case that be could not regard the discreditable origin of the user as cleansed by the subsequent history. In other words, the equitable relief will be afforded only to that party who is not guilty of a fraud and whose conduct shows that there had been, on its part, an honest concurrent user of the mark in question. If a party, for no apparent or a valid reason, adopts, with or without modifications, a mark belonging to another, whether registered or not, it will be difficult for that party to avoid an order of injunction because the Court may rightly assume that such adoption of the mark by the party was not an honest one. The Court would be justified in concluding that the defendant, in such an action, wanted to cash in on the plaintiff's name and reputation and that was the sole, primary or the real motive of the defendant adopting such a mark. Even if in such a case, there may be an inordinate delay on the part of the plaintiff in bringing a suit for injunction, the application of the plaintiff for an interim injunction cannot be dismissed on the ground that the defendant has been using the mark

for a number of years. Dealing with this aspect Harry D. Nims in his "The Law of Unfair Competition and Trade- Marks". Fourth Edition, Volume Two at page 1282 noted as follows:

WHERE infringement is deliberate and wilful and the defendant acts fraudulently with knowledge that he is violating plaintiff's rights, essential elements of estoppel are lacking and in such a case the protection of plaintiff's rights by injunctive relief never is properly denied. "The doctrine of estoppel can only be invoked to promote fair dealings."

59. In the case of Swaran Singh V. Usha Industries (India) &

Anr. reported as AIR 1986 Delhi 343 DB, it was held as under:

"(7) There is then the question of delay. Learned counsel for the respondents had urged that the delay is fatal to the grant of an injunction. We are not so satisfied. A delay in the matter of seeking an injunction may be aground for refusing an injunction in certain circumstances. In the present case, we are dealing with a statutory right based on the provisions of the trade and Merchandise Marks Act, 1958. An exclusive right is granted by the registration to the holder of a registered trade mark. We do not think statutory rights can be lost by delay. The effect of a registered mark is so clearly defined in the statute as to be not capable of being misunderstood. Even if there is some delay, the exclusive right cannot be lost. The registered mark cannot be reduced to a nullity. The principles governing other types of injunctions are not to be readily applied to a case like the present."

60. In view of settled law on the point of delay, the defendants

cannot be allowed to use the identical mark which is a slavish copy of

the mark of another party. It appears on an examination of the rival

labels of the parties that the defendants or a designer must have designed

the label of the defendants by placing the label of the plaintiffs in front

of them. The present case is a case of res ipsa lequitor where the things

speak for themselves.

61. Therefore, as far as the old label of the defendants is

concerned, prima facie, this court of the considered opinion that the

same is almost identical to the label of the plaintiffs. Thus, the

defendants are hereby injuncted and restrained from using their old label

which is the subject matter of the present suit during the pendency of the

suit.

62. Now coming to the modified label which is being used by the

defendants after the order dated 16th December, 2008.

63. Below is a copy of the defendants‟ label as it is now, i.e. after

modification in lieu of this court‟s order dated 16th December, 2008.

Defendants' modified label

64. After having gone through the judgments referred above and

on examination of the labels of the parties, this court is of the considered

opinion that the modified label still contains some essential features

similar to that of the plaintiffs‟ label, therefore, in order to avoid any

confusion and deception this court hereby allows the defendants to use

the modified label subject to the condition of change of the navy blue

coloured strip wherein the mark of the defendants „REAL‟ is mentioned.

The defendants are at liberty to use the said strip in any other colour

except the dark navy blue colour in order to avoid any deception.

65. The defendants are granted six months time to dispose of the

existing stock and use the label in relation to its products. The interim

order shall continue till the final disposal of the suit. The application

I.A. No. 12700/2008 is disposed off accordingly. No costs.

66. Needless to say, the finding arrived at in the present

application shall have no bearing on the final outcome of the suit.

67. List this matter before the Joint Registrar on 2nd February,

2010 for further proceedings.

MANMOHAN SINGH, J.

DECEMBER 15, 2009 nn