Tata Sons Ltd. vs Tata Industrial Recruitment
2009 Latest Caselaw 4343 Del

*          HIGH COURT OF DELHI : NEW DELHI

+                       C.S. [OS] No.1836 /2006

%                                 Decided on:     27th October, 2009

Tata Sons Ltd.                                        ...Plaintiff
                        Through : Mr. Pravin Anand, Adv. with
                                  Mr. Achuthan Srekumar, Adv.
                        Versus

Tata Industrial Recruitment                             ....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?                                       Yes

MANMOHAN SINGH, J.

1. The plaintiff filed the suit for permanent injunction restraining

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

and delivery up against the defendant. The case of the Plaintiff is that the

Plaintiff 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 or 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.

2. The enterprises promoted by the Plaintiff company have laid the

foundation in the industrial core sectors, pioneering the textiles, steel,

power, chemicals, hotels and transport industries in India.

3. As per the plaintiff, since its inception in 1917, the plaintiff

has been continuously and consistently using the trademark and trade

name TATA for its own business activities and those of companies

promoted by it.

4. 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.

5. The plaintiff is also the registered proprietor of several

TATA formative trademarks in relation to various goods across various

classes of the Fourth Schedule of the Trade Marks Rules, 2002. A

tabulated list of the plaintiff‟s trademark registrations is filed

alongwith representative copies of a few trademark registration

certificates. By virtue of the said registrations, the plaintiff has the

exclusive right to use the trademark TATA in relation to the goods

covered thereunder and to obtain relief in respect of the infringement

of the registered trademarks. The plaintiff also owns trademark

registrations for the word TATA in numerous countries besides India

and has additionally applied for registration of its trademark TATA in

over 30 countries.

6. Various companies promoted by the plaintiff and its group

companies belonging to the House of TATA state on their

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

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

plaintiff as the registered proprietor of various TATA trademarks

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

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

7. The plaintiff avers that as a result of the continuous and

extensive use of the plaintiff‟s 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.

8. The plaintiff in the month of August, 2006 was informed by

one of its group companies situated in Chennai that one of their

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

defendant regarding a job interview. The plaintiff also learnt that the

defendant had asked for various documents along with postage stamps

and application fee amounting to a total of Rs.150.

9. The plaintiff submits that the defendant is an entity calling

itself Tata Industrial Recruitment, with an office at 462 D Kamarajar

Road, Opp. Manis Threatre, Peelamedu, Coimbatore 641 004, Tamil

Nadu. The defendant is apparently operating as a recruitment agency.

10. The plaintiff further submits that the defendant‟s trading

style "Tata Industrial Recruitment" and the logo "TATA in a

globe/circle" incorporates the plaintiff‟s trademark TATA and therefore,

amounts to infringement of the plaintiff‟s registered trademark for

TATA.

11. The contention urged by the learned counsel for the plaintiff

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 they

have the approval or license of the plaintiff to carry on business under

the said trademark and trading style or that their activities are in some

manner or the other connected with or derived from the business of the

plaintiff, so as to pass off and earn huge and illegal profits thereby. The

defendant is therefore also indulging in acts of passing off by

representing their business as being that of or associated with the

plaintiff.

12. The plaintiff 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 into registering for the

defendant‟s services enabling unjust enrichment of the defendant at the

plaintiff‟s 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 plaintiff. All profits earned by

the defendant in pursuance of its illegal activities are the plaintiff‟s

losses and amount to unjust enrichment.

13. The plaintiff thus filed the present suit for permanent

injunction restraining the defendant from illegally using its trademark,

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

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

order was passed in favour of the plaintiff and was made absolute on 7 th

January, 2008. 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 18 th November, 2006.

The defendant was proceeded ex parte on 4th April, 2007. The Local

Commissioner in his report has given the details of all the papers,

documents and literary works seized by him and sealed in gunny bags.

The seized material clearly shows that the defendant is dealing and

providing services with all the papers bearing the trademark and trade

name TATA. By order dated 25th July, 2007 again a Local

Commissioner was appointed to de-seal the gunny bags and to get

photocopies of records. On de-sealing, the local commissioner in his

report stated that the documents consisted of partnership deed,

registration certificates and banks statement, account books of Tata

Industrial Recruitment which inscribed the trademark of the plaintiff.

15. A chartered accountant namely Mr. B.K. Anand, partner in

the firm S.N. Dhawan and Co. filed an affidavit ascertaining the

damages. It is stated by him after perusing the partnership deed of the

defendant dated 24th July, 2006, bank accounts statement of the

defendant‟s bank account No.615405041697 in ICICI Bank from

March, 2006 to August, 2006 and the report of the local commissioners

that the damages accrued to the plaintiff would be Rs.3,51,000/-.

16. As per order of the court, the plaintiff has produced the

evidence by way of affidavits of Mr.V.Gurumoorthi, Executive Officer

(Accounts & Admn) of Tata Services Ltd and Mr.Sanjeev Sharma,

Chartered Accountant. In the affidavit of Mr.V.Gurumoorthi, he has

reaffirmed the statements made in the plaint. The power of attorney in

his favour is proved as Ex.PW-1/1. The business activities of the Tata

Group is proved as Ex.PW-1/2. The details of the agreements entered

between the plaintiff company and Tata Teleservices and statement

certifying the existence of other such agreements between the plaintiff

company and other companies of Tata group companies is 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-1/16. The list

of various registrations granted in favour of the plaintiff in various

classes are marked as Ex.PW-1/18 and certificate of use in legal

proceedings for the trade mark TATA is marked as Ex.PW-1/17. The

plaintiff has also exhibited a copy of the defendant‟s letter addressed to

Ms. Sulegha Bhanu calling her for a job interview as Ex.PW-1/26.

The reports of both the Local Commissioners are marked as Ex.PW-

1/28 and Ex. PW-1/30 respectively.

17. I have heard learned counsel for the plaintiff and have also

gone through the relevant pleadings and documents placed on record. It

is an undisputed fact that the plaintiff has been continuously and

consistently using the trade mark and trade name TATA from the year

1917. The trade mark TATA is the registered trade mark in various

classes of goods in favour of the plaintiff. The said trade mark TATA

has acquired unique goodwill and reputation in favour of the plaintiff

and ipso facto due to the long and continuous user this trademark has

become a highly distinctive trade mark within the meaning of section 9

of the Act.

18. 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/dis-similar goods adopted and used by the

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

29(4) of the 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(z)(b) of the Act, because of its distinctiveness and

residual goodwill and reputation, it cannot be appropriated by any party

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

otherwise it would be clear case of violation of the rights of the plaintiff.

In the present case, no doubt the defendant is using the trademark TATA

in relation to recruitment services in the trading style „Tata Industrial

Recruitment‟ and the plaintiff may not have commercial activities of the

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

infringement of the plaintiff‟s trade mark within the meaning of Section

29(4) of the Act. The plaintiff has clearly established his case of

infringement of trade mark, therefore, the suit of the plaintiff for

infringement of trade mark is accordingly decreed.

19. 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 plaintiff by using the

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

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

or confuse the potential customers into believing that the defendant has

the approval or license from the plaintiff which in fact 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 said highly distinctive trade mark TATA by the

defendant is malafide and the defendant‟s activities deserve to be

permanently restrained by this court in relation to the relief of passing

off also.

20. In passing off action, one has to see as to whether the

defendant is selling goods/service so marked to be designed or

calculated to lead purchasers to believe that they are plaintiff‟s 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 forceably 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

21. 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.

22. 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.

23. In view of the above discussion, the plaintiff has established

his case for passing off also. The suit is accordingly decreed in terms

of para 21(a) and (b) of the plaint.

24. As regards the relief of damages, the plaintiff has prayed for

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

Thousand) by filing of the 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 he would have been if

he had not suffered the wrong. Extent of loss suffered or, the advantage

gained by the defendant by his wrongful act at the cost of the plaintiffs.

25. In the case of Time Incorporated v. Lokesh Srivastava,

2005 (30) PTC 3 (Del), the Court has recognized 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."

26. The evidence of the plaintiff has gone unrebutted which

includes loss of business, reputation and goodwill in the market. Since

the above claimed amount is based on the assessments by the plaintiff, I

am of the view that a sum of Rs.2 lac (Rupees Two Lac) can be

reasonably awarded to the plaintiff 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 the

goodwill.

27. The suit of the plaintiff is accordingly decreed in terms of

Para 21 of the plaint. The decree be drawn accordingly.

MANMOHAN SINGH, J.

OCTOBER 27, 2009 SD