Delhi High Court

M/S Dcm Shriram Consolidated ... vs M/S Shri Laxami Trader And Ors. on 23 October, 2009

Author: S. Muralidhar

       IN THE HIGH COURT OF DELHI AT NEW DELHI

                     IAs 6694,7600/2009 in CS(OS) 910/2009

                                        Reserved on: 9th September 2009
                                        Decision on: 23rd October 2009

       M/S DCM SHRIRAM CONSOLIDATED LIMITED
                                                  ..... Plaintiff
                    Through Mr. Maninder Singh, Sr. Advocate with
                    Ms. Meghana Mishra, Mr. Naveen Kumar,
                    Ms. Lakshmi Ramachandran, Mr. Akhil Sachar &
                    Mr. R.N. Karanjawala, Advocates.

                     versus

       M/S SHRI LAXAMI TRADER AND ORS.             ..... Defendants
                    Through Mr. K.G. Bansal, Advocate for D-3/
                    Applicant in IA 7600/2009.
                    Mr. Sunil K. Mittal with
                    Mr. Kshhitij Mittal, Advocate for D-4.

                     IAs 7417, 8023/2009 in CS(OS) 1035/2009

       M/S DCM SHRIRAM CONSOLIDATED LIMITED ..... Plaintiff
                    Through Mr. Ramji Srinivasan, Senior Advocate
                    with Mr. Naveen Kumar and
                    Ms. Vartika Sahay, Advocates.

                     versus

       SUMIT HARDWARE & ORS.                    ..... Defendants
                   Through Ms. Omika Dubey, Advocate for D-1.
                   Mr. N. Mahabir and
                   Mr. S. Gowthaman, Advocates for D-2 & 3/
                   Applicants in IA 8023/2009.

       CORAM:
       HON'BLE DR. JUSTICE S. MURALIDHAR

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

       2.     To be referred to the Reporter or not?                  Yes

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

                              JUDGMENT

23.10.2009

S. Muralidhar, J.

1. Both sets of applications arise out of similar facts and involve similar

questions and are accordingly disposed of by this common judgment.

2. CS(OS) No.910 of 2009 has been filed by DCM Shriram Consolidated Ltd.

(Plaintiff) against Shri Laxami Trader (Defendant No.1) having its shop at

Ghaziabad, M/s Ganesh Plaster (Defendant No.2) at Rohini, Delhi and M/s

Mukesh Khadaria (Defendant No.3) trading as M/s Agarwal Udyog, at K.K.

Bhukar Ka, Tehsil Noahr, Distt. Hanumangarh, Rajasthan. The suit is for

both infringement and passing off. The prayers in the suit are for a decree of

permanent injunction restraining the Defendants from manufacturing,

marketing, advertising or in any manner dealing with goods or services using

the mark "SHRIRAM" or any other mark identical or confusingly/deceptively

similar to Plaintiff‟s trademark "SHRIRAM" and from doing anything

directly or indirectly infringing the Plaintiff‟s said registered trademark

"SHRIRAM", a decree of permanent injunction to restrain the Defendants

from reproducing and/or using the get up, lay out, colour scheme or the

Plaintiff‟s packaging in the "SHRIRAM" product including the "SHRIRAM

Nirman Plaster of Paris" logo along with the blue, red and black colour striped

on white background, a decree of permanent injunction to restrain the

Defendants from using the mark/name "SHRIRAM‟ and from using the get

up, layout and colour scheme in the packaging similar to that of the Plaintiff,

and from doing any other thing as is likely to lead to passing off of the

business and goods of the Defendants as those of the Plaintiff. The other

prayers are for delivery up of all the infringing products, rendition of accounts

and damages. Defendants 1 and 2 in CS (OS) No.910/2009 are said to be

proprietorship firms. Defendant No.2 is a trader in Plaster of Paris (PoP)

manufactured by Defendants 1 and 3. Defendant No.2 is stated to be the

dealer of Defendant No.1 in Delhi. The case of the Plaintiff is that Defendants

are selling PoP in the NCT of Delhi under a mark which is deceptively and

confusingly similar to mark "SHRIRAM" of the plaintiff and that use of the

said trade marks by the Defendants is illegal, dishonest and fraudulent.

3. CS (OS) No.1035 of 2009 has been filed by the same Plaintiff against

Sumit Hardware (Defendant No.1), a shop in New Delhi, Mr. Bajarang Lal

Pareek (Defendant No.2) at Dhirwas, (Sahawa) District - Churu (Rajasthan)

and M/s Shriram Plaster Industries (Defendant No.3) also at Sahawa in

Rajasthan. The prayers in the suit are more or less similar to the prayers in CS

(OS) No.910/2009. Defendant No.1 (Sumit Hardware) is a trader of PoP and

Defendant No.3 Shriram Plaster Industries in Rajasthan is its manufacturer.

Defendant No.2 is stated to be the proprietor of Defendant No.3. It is alleged

that these Defendants are selling PoP in Delhi and in the neighbouring towns

under marks deceptively and confusingly similar to the "SHRIRAM"

trademark of the Plaintiff and that they are attempting to pass off their goods

as that of the Plaintiff.

4. In the plaints in both suits, it is stated that the Plaintiff, a public limited

company, has an annual turnover of Rs. 3000 crores with a diversified

portfolio comprising inter alia of merchandising of cement, PoP, PVC resin,

sugar, fertilizers, chemicals, plastics, and agri input products like urea,

pesticides, insecticides, herbicides etc. Most of the products of the Plaintiff are

sold under its umbrella brand "SHRIRAM" and command enviable reputation

in the market. The Plaintiff has drawn the trademark „SHRIRAM" from late

Lala Shri Ram who was an eminent entrepreneur and educationist. He is

stated to have championed industrial research, technical and professional

education in India. He was the founder of various reputed institutions

including the Shriram College of Commerce, Lady Shriram College, Delhi

School of Economics and Shriram Centre for Performing Arts etc.

5. It is further stated that the word "SHRIRAM" is the distinct and integral

part of the registered corporate name of the Plaintiff including that of units

and subsidiaries which are registered with the name of "SHRIRAM" for over

four decades. This include Shriram Fertilizers and Chemicals (since 1967),

M/s Shriram Cement Works (since 1986), SHRIRAM Vinyl and Chemicals,

Shriram Alkalies and Chemicals and SHRIRAM Polytechnic.

6. The Plaintiff states that the trademark "SHRIRAM" was adopted in 1967.

According to the Plaintiff, the international reputation of the mark

"SHRIRAM" is apparent from its association with M/s Yara Inc of Norway

which is co-branding the "SHRIRAM ENERGY" (for micronutrients) with

their "YARA LIVA" brand. It has continuously, uninterruptedly and

exclusively used the mark "SHRIRAM UREA" since 1977. The said trade

mark has been registered in the name of the Plaintiff under Registration

No.358500 dated 12th February 1980 in Class 1 in respect of fertilizers. The

Plaintiff also holds registration of the trade mark "SHRIRAM DAP" under

registration No.597743 dated 21st May 1993. The application for renewal of

the said mark is stated to be pending. Other registered trademarks of the

Plaintiff include "SHRIRAM NIRMAN" Plaster of Paris, "SHRIRAM-53"

Cement, "SHRIRAM MULTI-PURPOSE" Cement, "SHRIRAM SILVER"

Cement. In para 24 of the plaint in each of the suits, the registered trademarks

of the Plaintiff in Classes 1, 5, 19, 30, 31 and 40 and of the label "SHRIRAM"

and logo are listed. It is stated that the Plaintiff is the proprietor of the

the device arranged in an artistic way.

7. It is stated that by virtue of continuous, uninterrupted and extensive use,

the Plaintiff has acquired exclusive rights in the mark "SHRIRAM" which has

also been vigorously advertised by the Plaintiff through print, electronic and

other interactive medium, throughout India. It is stated that the Plaintiff has

spent over Rs.15 crores in advertisement. The products of the Plaintiff have

been of premium quality and have earned a good name and reputation among

the customers, dealers and general public. The Plaintiff further states that it

organizes various social-welfare and interactive programmes as part of its

corporate social responsibility schemes. These activities are carried out

through the SHRIRAM Krishi Vikas Kendras (KVKs) which in turn organise

interactive programmes where experts of the Plaintiff in agriculture and

cement, interact with the villagers and give them expert advice. During this

process, the brand "SHRIRAM" gets advertised in the rural areas through

banners, pamphlets and direct communications. It is claimed that the

SHRIRAM brand of the Plaintiff has a huge presence and a well-known

reputation in the rural parts of the country. It has been ranked among top ten

brands in India in the research conducted by Tele Nelson Mode in 1999 and

Indica Research in 2003.

8. As part of the list of documents filed in CS (OS) 910 of 2009, the Plaintiff

has included photographs of the packaging used by Defendants 1 to 3 and that

used by the Plaintiff for their respective products. Copies of the registration

certificates issued in favour of the Plaintiff under the Trademarks Act, 1999

(TM Act) as well as Copyright Act, 1957 (CR Act) have also been included.

Copies of the invoice evidencing sale and use of the product "SHRIRAM" by

the Plaintiff as well as the invoices of Defendant No.3 showing sales of the

infringing products in Delhi have been included.

9. In CS (OS) No.1035 of 2009, the Plaintiff has placed on record the

photographs of the packaging used by the Defendant No.3 for the products

sold by it. Copies of the invoices of the sales of `Shriram‟ products by the

Plaintiff and the cash memo issued by Defendant No.1 for sale of the

infringing product in Delhi have been included. The Plaintiff has also placed

on record copies of the certificates of registration of the trade mark and

10. CS (OS) No.910/2009 was listed on 19th May 2009 when this Court while

directing summons to issue to the Defendants granted an ex parte ad interim

injunction in IA No.6694 of 2009, under Order XXXIX Rules 1 and 2 CPC,

restraining the Defendants from using the impugned mark `SHRIRAM‟ on

their products. Local Commissioners were appointed to visit the business

premises of the Defendants, to make an inventory of the infringing materials

and release the goods on suprerdari to the Defendants. Pursuant thereto the

Commissioners have filed their reports enclosing samples of the infringing

packaging used by the Defendants on their products. In CS (OS) No. 1035 of

2009 a similar order was passed by this Court on 28th May 2009 in IA

No.7417 of 2009 (under Order XXXIX Rules 1 and 2 CPC). The

Commissioner appointed in the said suit has also filed a report placing on

record a sample of the packaging used by the Defendants for their products.

11. Against the order dated 28th May 2009, M/s. Shri Ram Plaster Industries

[Defendant No.3 in CS (OS) No.1035/2009] filed FAO(OS) No.322/2009.

The Division Bench by its order dated 3rd August 2009 did not grant any

interim order except recording the plea of the Appellant, i.e., M/s Shri Ram

Plaster Industries that in para 37 of the plaint it was not pleaded by the

Plaintiff that a cease and desist notice dated 25th May 2007, more than two

years earlier to the filing of the suit, had been issued; further the case being

essentially one for passing off with both the Plaintiff‟s and Defendants‟ marks

being registered, an ex parte order of interim injunction was not called for.

Alternatively, it was submitted that the cause of action paras 38 and 39 of the

plaint were silent about the date on which the cause of action arose. M/s Shri

Ram Plaster Industries was permitted by the Division Bench to raise the

aforementioned pleas before the Single Judge.

12. Thereafter Mukesh Khadaria [Defendant No.3 in CS (OS) No.910/2009],

filed an application (IA No.7600 of 2009) under Order XXXIX Rule 4 CPC

seeking vacation of the ex parte ad interim injunction. Likewise M/s Shri Ram

Plaster Industries (Defendant No.3) and Bajarang Lal Pareek (Defendant

No.2) filed IA 8023/2009 under Order XXXIX Rule 4 CPC in CS (OS)

No.1035/2009 seeking vacation of the ex parte ad interim injunction.

13. By the order dated 16th July 2009 the Plaintiff was permitted to amend CS

(OS) No.910/2009 to implead M/s Laxami Plaster Industries as Defendant

No.4 since it was also a manufacturer of the goods bearing the infringing mark

SHRIRAM. IA No. 7599/2009 was accordingly allowed and the amended

memo of parties was taken on record.

14. In the written statement filed in CS (OS) No.910/2009, the Defendant

No.3 Mukesh Khadaria has raised a preliminary objection that the suit should

be dismissed on account of suppression of material facts by the Plaintiff. In

particular it is averred that on 14th February 2007 the Plaintiff had served upon

M/s Mukesh Khadaria a cease and desist notice calling upon it to cease using

the trade mark "SHRIRAM". It is accordingly submitted that the user of the

trademark by Defendant No.3 was within the knowledge of the Plaintiff since

2007 and yet the suit was filed only in 2009. It is submitted that since it had

failed to disclose the exact date on which the cause of action arose, the

Plaintiff was not entitled to any ex parte ad interim injunction. It is further

submitted that the Plaintiff has in para 39 of the plaint admitted that the

Defendant‟s products had become distinct and well-known in the Indian

market for cement and PoP and therefore the user by the Defendants of the

said marks in 2007 was well-known to the Plaintiff. The suit was accordingly

said to be bad for delay, laches and acquiescence.

15. It is then submitted that by virtue of the operation of Section 28(3) and

Section 30 (2) (e) of the TM Act, the suit was bad since Defendant No.3 Mr.

Mukesh Khadaria was a registered proprietor of the trademark „Aggarwal

Shriram‟ under Registration No.1477746 in Class 19 and the said registration

was prima facie evidence of its validity in terms of Section 31 of the TM Act.

It is stated that the Defendant No.3 has already filed suit, CS (OS) No.2627 of

2008 titled Mukesh Khadaria v. Laxami Plaster Industries in which an

injunction was against the said Defendant from using the trademark LAXMI

SHRIRAM and which suit is pending adjudication. It is accordingly submitted

that there is no nexus between Defendant No.3 on the one hand and

Defendants 1 and 2 on the other. It is submitted that the said trademark

„Aggarwal Shriram‟ of the Defendant No.3 Mukesh Khadaria is different from

that of the Plaintiff in all respects, i.e., get up, lettering style etc. and therefore

the suit for passing of was also not maintainable. It is further submitted that

M/s DCM Shriram Consolidated Ltd. is not a juristic personality and has got

nothing to do with the registrations in relation to cement or PoP.

16. As regards the copyright it is submitted that the Plaintiff is neither the

author nor the owner of the impugned art work. M/s Kirti Advertising is not

the author of the impugned art work since no such entity existed and in any

event there was no written deed of assignment by M/s Kirti Advertising in

favour of the Plaintiff. It is stated that the averments in the plaint are vague

and it has not been shown how the Plaintiff can claim to be the Proprietor of

the alleged trademark since 1967 when it was not in existence on that date.

The invoices also did not pertain to it. On the other hand Defendant No.3

Mukesh Khadaria claims to have adopted the trademark „Aggarwal Shriram‟

since 2000 and to be continuously using it since then. It is claimed that the

said mark has become distinctive and is associated with the PoP and related

goods of Defendant No.3.

17. In the written statement filed by Defendants 2 and 3 in CS (OS)

No.1035/2009, it is submitted that Bajarang Lal Pareek (Defendant No.2)

honestly adopted SHRI RAM as a trademark, being an ardent devotee of Lord

Shri Ram and he himself being named Bajarang Lal, the devotee of Lord Shri

Ram. He had immense faith in Lord Shri Ram and considered it to be

auspicious to adopt SHRI RAM as a trading style in the year 1996. He claims

to have commenced the business of manufacturing and marketing PoP since

2000, after discontinuing his earlier business in certain other commodities. It

is claimed that the said PoP goods are being marketed under the trademark of

SRP as coined from the initials of Defendants‟ trading style SHRI RAM

PLASTER. The device of kalash was also adopted by the said Defendants.

The Defendant No.2 states that he started business on 16th March 2000 with

Shri Yash Bhatia as partner. Shri Bhatia retired on 24 th April 2003 and waived

his rights in the trademarks SRP and SHRI RAM PLASTER. The partnership

firm was reconstituted. The incoming partners also waived their rights in the

trademark and copyright SHRI RAM PLASTER and SRP LOGO. The copies

of the partnership deeds and release letters have been included in the

documents filed by the Defendants. It is stated that the M/s Shriram Plaster

obtained registration for the mark SHRI RAM PLASTER and SRP LOGO

along with device of kalash under registration No. 1327339 in Class 19

(building material (Non Metallic), non metallic rigid pipes for building,

asphalt, pitch and Bitumen etc.) According to the Defendants in the year 2007

Defendant No.2 by his own intellectual efforts developed the art work and

applied it on the packaging. He being the author as well as the owner of the art

work applied for registration for the work on 14th June 2008 with the

84912/2009. Certified extracts from the Register of Copyrights have been

annexed with the list of documents. It is stated that the Defendant No.2 has

been granted ISO 9000 on account of the excellent quality for the product

SHRI RAM and that the Defendant No.2 has been openly using, advertising

and selling goods under the trade mark SHRI RAM all over India including

New Delhi since 2000.

18. Defendant No.3, Shri Ram Plaster states in para 9 of the written statement

that "the Plaintiff had in the year 2007 issued a notice to the Defendant

regarding the trade mark SHRI RAM. As the Defendant did not see any merit

in the said notice, the Defendant did not deem it worthy to reply to the said

notice." It is alleged that this fact was suppressed by the Plaintiff while filing

the suit only with a view to obtaining an ex parte ad interim injunction. Thus

Defendant No.3 submits that the suit is bad for delay, laches, acquiescence

and waiver. According to the Defendant Shri Ram Plaster it is selling its

goods since 1996 under the trading style of SHRI RAM, openly, extensively,

concurrently and uninterruptedly. A further point is taken that since SHRI

RAM is the presiding deity and the Hindus have immense faith in Lord Shri

Ram and that any Hindu can adopt the God‟s name out of his faith, the

Defendant No.3 cannot be restrained from practising his faith in any manner

as he chooses. It is alleged that the suit has hurt the religious sentiments of the

Defendant No.3. It is alleged that the mark SHRI RAM cannot be a source of

monopoly of the Plaintiffs. It is stated that the "Plaintiff‟s case is based upon

SHRIRAM and that it being God‟s name cannot be considered to be

distinctive so as to indicate trade origin of the Plaintiff".

19. Considering that both Defendants have claimed registrations of these

marks in their favour and one of them has claims regarding copyright as well,

the present suits are treated essentially as actions for passing off. The word

"SHRIRAM‟ is the essential feature of the mark adopted by both the Plaintiff

as well as the Defendants. The said mark is identical and not merely similar.

In terms of the decision of the Supreme Court in Kaviraj Pandit Durga Dutt

Sharam v. Navaratna Pharmaceutical Laboratories AIR 1965 SC 980 the

defendants can expect to escape liability only if they can show "that the added

matter is sufficient to distinguish their goods from that of the Plaintiff." The

only added feature in the marks adopted by the Defendants is the prefix

"Aggarwal" or "Laxmi‟. These can hardly be said to distinguish the products

of the Defendants from that of the Plaintiff.

20. Next, the packaging used by the Plaintiff and the Defendants for their

respective products are examined. The photographs of the packaging in which

the Plaintiff‟s PoP is sold are as under:-

21. As far as the Defendant No.3 in CS (OS) No.910/2009 M/s Mukesh

Khadaria trading as Aggarwal Udyog is concerned the photographs of the

packaging used by it (both front and rear view) are as under:-

22. The photographs placed on record of the packaging used by Defendant

No.4 in CS (OS) No. 910 of 2009, M/s. Laxami Plaster Industries (both front

and rear view), are as under:

23. Likewise the photographs of the packaging (both front and rear view) used

by M/s Shriram Plaster (Defendant No.3 in C.S. (OS) No. 1035 of 20009) are

as under:

24. A visual comparison of the above packaging makes it apparent that the

aforementioned Defendants have adopted not only the essential and identical

feature of the Plaintiff‟s trademark SHRIRAM but have also imitated the logo,

the device, the colour combination which is very similar to the logo and

device used by the Plaintiff. The font and lettering of the word "SHRIRAM",

its positioning in the packaging and combination of black and red letters in the

same sequence, the use of the kalash device, can easily lead to deception and

confusion among unwary customers seeking to buy PoP in the rural areas. The

logo design and marks adopted by the Defendants are confusingly and

deceptively similar to the logo design, marks, trademark style, and art work

adopted by the Plaintiff. The line of trade of the Plaintiff and the Defendants

is the same i.e. products used in the building construction industry. The

market for their respective products is therefore the same. The product is PoP.

The packaging used is almost identical. The plastic bags containing the

Defendants products when stacked side by side with the Plaintiff‟s bags in any

shop selling such products would make them indistinguishable. Even if they

are not stacked side by side a purchaser of PoP on viewing the bags of the

Defendants products in any shop selling these items is likely to be deceived

into thinking that the Defendants products are that of the Plaintiff‟s.

25. The defence of the Defendants based on the dissimilarities in the marks

and logo adopted by them is prima facie without merit. The other defence is

that the Plaintiff has suppressed material facts by not mentioning in the plaint

that cease and desist notices were issued to each of them by the Plaintiff in

2007. It is stated that inasmuch as the Plaintiff was aware that the Defendants

have been using the infringing marks and logos since 2007, the suits must fail

on the grounds of laches and acquiescence. The fact remains that neither of

the Defendants thought it fit to reply to the said cease and desist notice of the

Plaintiff. Therefore, the Defendants cannot seek to take advantage of the fact

that the Plaintiff was aware of the infringement since 2007. In the

circumstances, this Court is not able to come to the conclusion that either this

fact was a material fact, for the suppression of which the Plaintiff ought to be

denied interim injunction or that even if the fact of issuance of such cease and

desist notices had been disclosed in the plaint, the Court may have been

persuaded not to grant an interim injunction. What should weigh with the

Court is the nature of the suppression pleaded in the case. In the considered

view of this Court, the non-disclosure by the Plaintiff of the fact of it having

issued cease and desist notices to the Defendants does not, in the facts and

circumstances of the present case, make a difference to the decision to grant

the Plaintiff an ad interim injunction. In that view of the matter, this Court is

not persuaded to accept the arguments of the Defendants based on the

judgments in Seemax Construction (P) Ltd. v. State Bank of India AIR 1992

Delhi 197; The Fairdeal Corporation (Pvt.) Ltd. v. Vijay Pharmaceuticals

(1985 PTC 80) and Om Prakash Gupta v. Parveen Kumar 2000 PTC 326.

26. Consequently this Court is also unable to accept the plea of the Defendants

based on the judgment in Gopal Engg. & Chemical Works v. POMX

Laboratory AIR 1992 Delhi 302 that injunction ought to be refused on

account of the delay in the Plaintiff approaching this Court. On the other hand

the decision in Pankaj Goel v. Dabur India Ltd. 2008 (38) PTC 49 (Del.)

(DB) suggests that grounds of delay and concurrent use cannot by themselves

be sufficient to deny injunction. In Hindustan Pencils Pvt. Ltd. v. M/s. India

Stationery Products Co. AIR 1990 Del 19, it was observed as follows:

"If a party, for no apparent or 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 plaintiffs 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 willful and the defendant acts fraudulently with knowledge that he is violating plaintiff s rights, essential elements of estoppels are lacking and in such a case the protection of plaintiffs rights by injunctive relief never is properly denied." The doctrine of estoppels can only be invoked to promote fair dealings"."

27. The other defence raised by both sets of Defendants concerns their alleged

honest and concurrent use of the mark SHRIRAM. The case of M/s Shri Ram

Plaster Industries is based solely on the fact that the name was inspired by

Lord Shri Ram and that Defendant No.2 is himself an ardent devotee of Lord

Shri Ram. However, there is nothing substantial placed on record by the

Defendants to back this claim of honest and concurrent and prior user of the

mark SHRIRAM. While the Plaintiff has been able to prima facie show that

its mark SHRIRAM though not inherently distinctive has acquired

distinctiveness over long years of continuous usage, the Defendants have not

been able to establish such a prima facie case at this stage. The explanation

offered by the Defendants of their honest adoption of the mark SHRIRAM is

not convincing at all.

28. Going by the tests laid down in Laxmikant V. Patel v. Chetanbhai Shah

(2002) 3 SCC 65, it appears to this Court that since there is possibility of

deception and confusion in the trade, an injunction should be granted even if

one were to accept the Defendants‟ case that they adopted the mark in

question honestly. The registration in favour of the Defendants does not

advance their case for denial of injunction to the Plaintiff. The mere fact that

there is a subsequent registration in favour of the Defendant is not a defence in

an action for passing off. In terms of Section 27(2) of the TM Act, the right

of the Plaintiff to seek an injunction on the basis of passing off cannot be

negated only because there is registration granted in favour of the Defendants

for the same or similar mark. In this context the observations in Century

Traders v. Roshan Lal Duggar AIR 1978 Del 250 are also relevant.

29. The Defendants have not been able to counter the formidable case of the

Plaintiff as to its prior user of the mark SHRIRAM, which was drawn from

the name of its entrepreneur late Lala Shriram who was an industrialist,

philanthropist and educationist. The Defendants have no answer to the

Plaintiff‟s case that Sir Shri Ram championed the cause of industrial research,

technical and professional education in India and was the founder of several

institutions such as the Shriram College of Commerce, Shriram Institute of

Industrial Research, Lady Shriram College, Delhi School of Economics,

Shriram Center for Performing Arts and many more. The Defendants also

have not been able to deny that several manufacturing units of the erstwhile

DCM Limited started by Sir Lala Shriram and the erstwhile DCM Limited

were renamed after him. M/s Rajasthan Chemicals has been renamed as M/s

Shriram Fertilizers and Chemicals. Many other units of DCM Ltd. also

adopted SHRIRAM as part of their corporate names in 1967 and 1977. M/s

Shriram Cement established its cement plant at Kota in Rajasthan and was

registered under the Factories Act. The Defendants have also not been able to

counter the case of the Plaintiff regarding the availability of various products

of the Plaintiff group of companies, including Shriram Cements in Rajasthan,

in the rural areas. The Plaintiff group‟s products in the fields of fertilizers,

chemicals and agricultural products including building and construction

products like PoP have been prima facie shown to have acquired a formidable

reputation. The registration certificates issued in favour of the Plaintiff also

establish the prior user by the Plaintiff of the mark "SHRIRAM". The

numerous documents placed on record showing the sales of SHRIRAM

products by the Plaintiff group of companies and the wholesaler agreements

from 1975 onwards also bear this out. The earliest invoices of the Defendants

on the other hand are from 2002 onwards. The contention that the Plaintiff has

in para 39 of the plaint admitted that the Defendant‟s products had become

distinct and well-known in the Indian market for cement and PoP is an

obvious typographical error when the said para is read as a whole. It is plain

that the reference therein is to the Plaintiff‟s products and not the Defendants‟.

30. The trademark and copyright registration certificates produced by the

Plaintiff prima facie show the connection of the Plaintiff with the Shriram

group of companies and of its proprietorship of the marks and logos and

artistic work in question. Each company of the Shiram group in whose favour

the registration has been granted is referred to as a unit of the Plaintiff

company. As regards the reputation earned by the mark SHRIRAM, the

settled law appears to be prima facie in favour of the Plaintiff. In Corn

Products Refining Co. v. Shangrilla Food Products Ltd. [1960(1) SCR 968

@ p.973], it was held that as far as the reputation to be acquired by the

trademark "it should appear that the public associated that trade mark with

certain goods". In the said case, it was stated that reputation was that of the

trade mark and not that of the maker of the goods bearing that trade mark. As

far as the present case is concerned, both tests appear to be prima facie

satisfied. For the aforementioned reasons, it is held that the Plaintiff has been

able to make out a prima facie case for grant of an interim injunction in its

favour.

31. As regards the balance of convenience, an argument was advanced that the

Defendants were small traders who are sought to be snuffed out by a powerful

Plaintiff. Reliance was placed on certain observations of the Supreme Court in

London Rubber Co. Ltd. v. Durex Products PTC (Suppl) (1) 246 (SC) @

p.256. In the said decision it was observed by the Supreme Court that it was

not possible to lay down any hard and fast rule on the volume of use necessary

to establish honest and concurrent use in terms of Section 10(2) of the 1940

Act (which corresponds to Section 12 of the 1999 Act). In the present case,

the volumes of trade of the Defendants and the Plaintiff are not comparable at

all. Still, the Court is satisfied prima facie that the Defendants‟ use of mark

SHRIRAM is neither honest nor bona fide. Merely because the Defendants are

small traders compared to the Plaintiff, they cannot be permitted to pass off

their goods as that of the Plaintiff. The other factor is the deception in the

trade and among unwary consumers with imperfect recollection. The court has

to account for the fact that they may be misled into buying an inferior product

thinking it to be originating from the Plaintiff. Recently, in Amar Singh

Chawal Wala v. Shree Vardhman Rice and Genl. Mills 2009 (40) PTC 417

(Del) (DB) [which has been affirmed by the dismissal by the Supreme Court

on 7th September 2009 of SLP (C) No. 21594/2009], the Division Bench of

this Court referred to the following passage on McCarthy on Trademarks

(p. 346) para 30.21:

"Some courts also consider the necessity of protecting third parties in trade mark infringement cases, "third parties" means the buying public. If the equities are closely balanced, the right of the public not to be deceived or confused may turn the scales in favour of a preliminary injunction."

Keeping in view all these factors, it is held that the balance of convenience in

granting an interim injunction as prayed for is in favour of the Plaintiff.

32. It may be mentioned here that at the hearing on 9 th September 2009 the

proprietor of Defendant No.1 in CS (OS) No. 1035 of 2009 (M/s. Sumit

Hardware) stated in court that he was prepared to make a statement that he

would not sell any product in the infringing packaging of Shriram Plaster. He

was, however, directed to file an affidavit explaining how he came to be found

in possession of the infringing packaging in the first place.

33. For all of the aforementioned reasons, this Court is satisfied that the

Plaintiff has made out a case for continuance of the ad interim injunction

during the pendency of the suits. Accordingly, the interim order dated 19th

May 2009 passed in IA No. 6694/2009 in CS (OS) 910/2009 and the interim