Tata Sons Limited & Ors. vs Tata Sumo Industries (R)
2009 Latest Caselaw 4728 Del

*     HIGH COURT OF DELHI : NEW DELHI


+     CS (OS) No. 1837/2006

%                                        Decided on :19th November, 2009


Tata Sons Limited & Ors.                                           ...Plaintiffs
                  Through :      Mr. Pravin Anand and
                                 Mr. Achuthan Sreekumar, Advs.

             Versus

Tata Sumo Industrial (R)                                          ...Defendant
                  Through :      None

Coram:

HON'BLE MR. JUSTICE MANMOHAN SINGH

1. Whether the Reporters of local papers may
   be allowed to see the judgment?                           No

2. To be referred to Reporter or not?                        Yes

3. Whether the judgment should be reported
   in the Digest?                                            No

MANMOHAN SINGH, J.

1. The plaintiffs filed the present suit for permanent injunction

restraining infringement of trademark, passing off, damages and rendition of

accounts and delivery up against the defendant. The plaintiff no. 1 Tata Sons

Ltd. and plaintiff No.2 Tata Motors Ltd. are companies duly incorporated

under the Indian Companies Act, 1913 having their registered office at

Bombay House, 24 Homi Mody Street, Mumbai-400 001. Mr. V.

Gurumoorthi and Mr. M.S. Pradeep are the duly constituted attorneys of

Plaintiff No. 1 and plaintiff No.2 respectively and are authorized to sign and

verify the pleadings and institute the present suit on their behalf.

2. The case of the Plaintiffs is that the Plaintiff No. 1 company was

established in the year 1917 as a body corporate and is the principal

investment holding company of TATA, which is India‟s oldest, largest and

best - known conglomerate, with a turnover of over US$21 billion/ Rs.

96,000 crores for the financial year 2005-06. Its genesis came from the

surname of its founder Jamsethi Nusserwanji Tata, and the same has

become synonymous with excellence in almost every field of business

activity.

3. The enterprises promoted by the TATA have laid the foundation in the

industrial core sectors, pioneering the textiles, steel, power, chemicals, hotels

and transport industries in India.

4. The Plaintiff No. 2 was established in 1945 and is India‟s largest

automobile company, with revenues of US$5.5 Billion/ Rs. 24,000 crores in

2005-06. It is the leader in commercial and passenger vehicles and is the

world‟s fifth largest medium and heavy commercial vehicle manufacturer.

Its manufacturing base is spread across Jamshedpur, Pune and Lucknow,

supported by a nation-wide dealership, sales, services and spare parts

network comprising about 1200 touch points.

5. As per the plaintiffs, since its inception, the plaintiffs have been

continuously and consistently using the trademark and trade name TATA

for their own business activities and those of companies promoted by it.

6. The House of TATA consists of over 100 companies of which over

50 companies use TATA as a key and essential part of their corporate name.

7. The plaintiffs are the proprietors of the trademark TATA by virtue of

priority in adoption, long, continuous and extensive use and advertising, and

the reputation consequently accruing thereto in the course of trade.

8. In addition to the common law rights that have accrued to the

Plaintiffs by virtue of the aforesaid facts, they are also the registered

proprietors of several TATA-formative trademarks, including TATA SUMO

in relation to various goods across various classes of the Fourth Schedule of

the Trade Marks Rules, 2002. The plaintiffs have filed the tabulated list of

the plaintiffs‟ trademark registrations alongwith representative copies of a

few trademark registration certificates. By virtue of the said registrations,

the plaintiffs claimed to have exclusive right to use the trademark TATA

and TATA SUMO in relation to the goods covered thereunder and to obtain

relief in respect of infringement of the registered trademarks. The plaintiffs

also own trademark registrations for the word TATA in numerous countries

besides India and has additionally applied for registration of their trademark

TATA in over 30 countries.

9. The plaintiffs state that various companies promoted by the plaintiffs

and their group companies belonging to the House of TATA on their

products/packaging use the name „A TATA PRODUCT‟ while those

dealing in services uses the trading style and service mark TATA. The

plaintiffs as the registered proprietors of various TATA trademarks license

the use of these to other TATA companies, which manufacture the goods

and sell them or render services under the said trademark(s).

10. The plaintiffs aver that as a result of the continuous and extensive use

of the trademark TATA over a long period of time spanning a wide

geographical area coupled with vast promotion and publicity, the said

trademark enjoys an unparalleled reputation and goodwill and has acquired

the status of a "well known" trademark.

11. The plaintiffs contend that in the month of August, 2006 plaintiff No.1

was informed by one of its group companies situated in Chennai that one of

its customer‟s relative received a letter dated 6th July, 2006 from the

defendant regarding a job interview. The plaintiff No.1 also learnt that the

defendant had asked for various documents along with postage stamps and

application fee amounting to a total of Rs.125.

12. The plaintiffs submit that the defendant is an entity with the name

Tata Sumo Industrial (R), with an office at 64 Uttukuli Road, Palayakkadu

Bus Stop, Tirupur 641 601, Tamil Nadu. The defendant is apparently

alleged to be operating as a recruitment agency.

13. The plaintiffs further submit that the defendant‟s trading style "Tata

Sumo Industrial (R)" incorporates the plaintiffs‟ trademark TATA and

TATA SUMO which has been extensively used by the Plaintiffs since 1917

and 1994 respectively and therefore amounts to infringement of the

Plaintiffs‟ registered trademarks.

14. The contention urged by the learned counsel for the plaintiffs is that

by using the impugned trademark and trade name, the defendant is

defrauding the general public and is likely to continue to mislead, deceive

or confuse potential job applicants into believing that it has the approval or

license of the plaintiffs to carry on business under the said trademark and

trading style or that its activities are in some manner or the other

connected with or derived from the business of the plaintiffs, so as to pass

off their services as connected to the plaintiffs and earn huge and illegal

profits thereby. The defendant is, therefore, also indulging in acts of passing

off by representing its business as being that of or associated with the

plaintiffs.

15. The plaintiffs urged that the use of an identical trademark/name by

the defendant would create confusion and deception in the minds of the

public who will be misled and the same would lead to unjust enrichment of

the defendant at the plaintiffs‟ and the consumers‟ expense. The unlawful

activities of the defendant are bound to cause incalculable harm and injury to

the business, goodwill and reputation of the plaintiffs. The plaintiffs submit

that all profits earned by the defendant in pursuance of its illegal activities

are the plaintiffs‟ losses.

16. The plaintiffs thus filed the present suit for permanent injunction

restraining the defendant from illegally using their trademark, and for

damages to the tune of Rs.20,05,000/-.

17. Vide order dated 26th September, 2006 an ex parte ad interim order

was passed in favour of the plaintiffs. On the same date, a Local

Commissioner was also appointed who visited the premises of the defendant,

seized the impugned infringing goods and filed the report on 15th November,

2006. The Local Commissioner in his report has given an inventory of the

articles seized from the said premises bearing the trademark and trade name

TATA.

18. Summons were served upon the defendant through its representative

on 23rd July, 2007 but none appeared for the defendant nor was any written

statement filed on its behalf. The defendant was proceeded ex parte on 7th

April, 2007 and the interim orders were made absolute.

19. As per the orders of the court, the plaintiffs have produced the

evidence by way of affidavits of Mr.V.Gurumoorthi, constituted attorney of

plaintiff no. 1 as Ex PW1/A and Mr. Menath Sreedharan Pradeep,

constituted attorney of plaintiff no. 2 as Ex PW2/A. In the affidavits, Mr. V.

Gurumoorthi and Mr. Menath Sreedharan Pradeep have reaffirmed the

statements made in the plaint. The power of attorney in their favour is

proved as Ex.PW-1/1 and Ex PW2/1 respectively.

20. Mr. Menath Sreedharan Pradeep has proved few trademark

registrations in favour of the plaintiff No.2 Company. The details of the

agreements entered into between the plaintiff No. 1 company and Tata

Teleservices and the statement certifying the existence of other such

agreements between the plaintiff No.1 company and other companies of

Tata Group Companies is also proved and exhibited as Ex. PW-1/7. A brief

note on the activities of various group companies belonging to the House of

TATA is annexed as Ex.PW-1/11. The list of various registrations granted

in favour of the plaintiffs in various classes is elaborated in the affidavit of

Mr. V. Gurumoothi filed as PW1/1 in para 11 and certificate of use in legal

proceedings for the trade mark TATA is marked as Ex.PW-1/14 collectively.

The plaintiffs have also exhibited a copy of the defendant‟s letter addressed

to Ms. Sulegha Bhanu calling her for a job interview as Ex.PW-1/21. The

report of the Local Commissioner is marked as Ex.PW-1/24.

21. I have heard learned counsel for the plaintiffs and have also gone

through the relevant pleadings and documents placed on record. It is an

undisputed fact that the plaintiffs have been continuously and

consistently using the trade mark and trade name TATA and TATA

SUMO from the year 1917 and 1994 respectively. The trade mark

TATA is the registered trade mark in various classes of goods in favour

of the plaintiffs. The said trade mark TATA has acquired unique

goodwill and reputation and ipso facto due to the long and continuous

user this trademark, it has become a highly distinctive trade mark within

the meaning of Section 9 of the Act.

22. The said trade mark TATA is not only registered in India but is

also registered in various other countries of the world. It is not in

dispute that the mark TATA has been protected from time to time by the

courts in relation to similar/dissimilar goods adopted and used by the

infringing parties. Hence, this trade mark is protected under Section

29(4) of the Trade Marks Act, 1999. In view of the facts and

circumstances mentioned above, since „TATA‟ is a well known trade

mark within the meaning of Section 2 (1) (zg) of the Act, because of its

distinctiveness and goodwill and reputation, it cannot be appropriated by

any party in India in relation to any merchandise goods/services/trade

name as it would be a clear case of violation of the rights of the

plaintiffs.

23. In the present case, no doubt the defendant is using the trademark

TATA in relation to recruitment services in the trading style „Tata Sumo

Industrial (R)‟ and the plaintiffs may not have commercial activities of

the same service but use of the said trade mark by the defendant is an

infringement of the plaintiffs‟ trade mark within the meaning of Section

29(4) of the Act. The plaintiffs have clearly established the case of

infringement of trade mark, therefore, the plaintiffs are entitled to a

decree in their favour.

24. Now as far as the question of passing off is concerned, it is clear

that the defendant is indulging in the acts of passing off by representing

its business as that of or associated with the plaintiffs by using the

impugned trade mark/name of the plaintiffs. The defendant has

defrauded the general public and is likely to continue to mislead/deceive

or confuse potential customers into believing that the defendant has the

approval or license of the plaintiffs which is not true. It appears,

therefore, that the adoption and use of the said trade mark by the

defendant is only with a view to make illegal profits out of the same.

The adoption of the trade mark TATA by the defendant, which has

become highly distinctive, is malafide and the defendant‟s activities

deserve to be permanently restrained by this court, at the same time

entitling the plaintiffs to the relief of passing off also.

25. In passing off action, one has to see as to whether the defendant is

selling goods/services so marked to be designed or calculated to lead

purchasers into believing that they are plaintiffs‟ goods. The law of

passing off prevents commercial dishonesty representing one‟s goods as

the goods of somebody else. It is well settled law that an action for

passing off is a common law remedy being an action in substance of

deceit under the law of Tort. In Warnik Vs Townend & Sons (HULL)

Ltd. 1979 AC 731, Lord Diplock identified the following five

characteristics which must be represented in order to create a valid cause

of action for passing off:-

      -      A misrepresentation.

      -      Made by a trader in course of trade,

      -      To prospective customers of his or ultimate customers of goods
             or services supplied by him,

      -      Which is calculated to injure the business or goodwill of

another trader (in the sense that there is a reasonable consequence) and

- Which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in quia timet action) will probably do so.

Protection under the doctrine of dilution and unfair competition

26. According to the doctrine of dilution, even if a person uses

another‟s well-known trademark or trademark similar thereto for goods

or services that are not similar to those provided by such other person,

although it does not cause confusion among consumers as to

the source of goods or services, it may cause damage to the well-known

trademark by reducing or diluting the trademark‟s power to indicate the

source.

27. Since traditional trademark law is designed to protect trademarks

for the purpose of preventing confusion, many countries provide for

protection of well-known trademarks under the doctrine of dilution in

unfair competition prevention law. This is because where a person uses

another person‟s well-known trademark or trademark similar thereto for

the purpose of diluting the trademark, such use does not cause confusion

among consumers but takes advantage of the goodwill of the well-

known trademark and constitutes an act of unfair competition.

28. In view of the above discussion, the plaintiffs have established

their case for infringement and passing off. The suit is accordingly

decreed in terms of para 24(i) and (ii) of the plaint.

29. As regards the relief of damages, the plaintiffs have prayed for

the loss of profits of at least Rs.20,05,000 (Rupees Twenty Lac Five

Thousand) by filing of an affidavit. In General Tire Vs. Firestone,

(1975) 1 WLR 819, it was observed that the general rule is that the

measure of the damages is, as far as possible, that sum of money, which

will put the injured party in the same position, as it would have been if it

had not suffered the wrong. It is the extent of loss suffered or, the

advantage gained by the defendant by his wrongful act at the cost of the

plaintiffs.

30. In the case of Time Incorporated v. Lokesh Srivastava, 2005

(30) PTC 3 (Del), the Court has recognized a third type of damages as

„punitive damages‟ apart from compensatory and nominal damages. The

court held that:

"The award of compensatory damages to a plaintiff is aimed at compensating him for the loss suffered by him whereas punitive damages are aimed at deterring a wrong doer and the like minded from indulging in such unlawful activities...""

"This Court has no hesitation in saying that the time has come when the Courts dealing actions for infringement of trademark, copy rights, patents etc. should not only grant

compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them."

31. The evidence of the plaintiffs has gone unrebutted. The plaintiffs

established their case for loss of business, reputation and goodwill in the

market. Since the above claimed amount is based on the assessments by

the plaintiffs, I am of the view that a sum of Rs.2 lac (Rupees Two Lac)

can be reasonably awarded to the plaintiffs as compensatory damages

and a sum of Rs.2 lac (Rupees Two Lac) as punitive/exemplary

damages as well as damages on account of loss of reputation and

damage to goodwill, i.e. a total of Rs. 4 lac (Rupees Four Lac).

32. The suit of the plaintiffs is accordingly decreed in terms of Para

24 (i) and (ii) of the plaint. The decree be drawn accordingly. The

plaintiff is entitled to costs.

MANMOHAN SINGH, J.

NOVEMBER 19, 2009 nn