Wheels India vs Nirmal Singh & Ors.
2010 Latest Caselaw 3893 Del

*           IN THE HIGH COURT OF DELHI AT NEW DELHI


%                                                Date of decision: 20.08.2010


+            FAO (OS ) NO.1 OF 2010 and CM No.51/2010



WHEELS INDIA                                                    ...APPELLANT


                                Through:        Mr.Mohan Vidhani and                    Mr.
                                                Rahul Vidhani, Advocates.


                                          Versus


NIRMAL SINGH & ORS.                                             ...RESPONDENTS


                                Through:        Mr.Ajay Sahni, Mr.Siddharth
                                                Bambha and Mr.Devanshu Jain,
                                                Advocates.


CORAM:
HON'BLE MR. JUSTICE SANJAY KISHAN KAUL
HON'BLE MR. JUSTICE VALMIKI J. MEHTA

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

2.        To be referred to Reporter or not?                            NO

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


SANJAY KISHAN KAUL, J. (ORAL)

1. The appellant filed a suit for infringement of trademark,

passing off, rendition of accounts etc. against the

respondents in respect of wheel covers for use in motor

vehicles and other allied and cognate goods being used

as accessories in such motor vehicles under the _____________________________________________________________________________________________

trademark 'PRINCE'. The appellant also filed an

application seeking interim relief under Order 39 Rules 1

and 2 of the Code of Civil Procedure, 1908 ('the said

Code' for short). The claim of the appellant was

predicated on a registered trade mark since 27.09.2004

with the allegation that the respondents had come into

the trade subsequently to tarnish the reputation and

goodwill of the appellant. An interim order was granted

in favour of the appellant on 02.06.2006. However, on

the respondents moving an application under Order 39

Rule 4 of the said Code, interim order was modified on a

statement of the counsel for the appellant that the

appellant had no objection if the respondents continue

using their firm name as 'PRINCE Auto Industries' but

they should not use the trademark 'PRINCE'. The said

two applications for stay and vacation of stay were,

thereafter, decided in terms of the impugned order dated

15.10.2009. The application filed by the appellant under

Order 39 Rules 1 and 2 of the said Code was dismissed

and the interim orders were vacated. The present appeal

has been preferred against the said order.

2. A reading of the plaint filed by the appellant shows that

the appellant claims continuous, open and extensive use

of the mark 'PRINCE' since April, 2001 with huge sales

though the mark 'PRINCE' is stated to have been

registered on 27.09.2004 in respect of the accessories

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used in cars included in Class 12. The appellant claims

to have come to know in May, 2006 that the goods of

respondents were in the market with the identical trade

mark 'PRINCE'. Respondents filed their written statement

and contested the pleas raised by the appellant. The

respondents claimed that R-2 had adopted the trade

mark/trade name 'PRINCE Auto Industries' in the year

1998 which was much prior to the alleged adoption of the

trademark 'PRINCE' by the appellant in the year 2001.

The respondents alleged suppression of facts by the

appellant. The most important suppression is stated to

be non dis-closure of the fact that the appellant was one

of the authorized stockiest of R-2 since the year 2001

and, in fact, subsequently had entered into the written

agreements dated 19.08.2002 and 20.09.2002 in that

capacity. The registration of the mark by the appellant is

alleged to be fraudulent soon after R-2 ceased to have

any business dealing with the appellant on account of the

alleged defaults in payments due to R-2. The

respondents have filed documents in support of the plea

including the appellant's application for registration to

the sales tax authorities in September, 2001 as

distributor of R-2 which fact is endorsed on the sales tax

certificate of the appellant.

3. In order to arrive at the conclusion, learned Single Judge,

in our considered view, has rightly framed the question

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as to whether the appellant being a prior user since 1998

of the business name 'PRINCE Auto Industries' with

emphasis on the mark 'Prince' be deprived and divested

of its rights to use the trademark/trade name 'PRINCE'

even though there is a close relationship and nexus

between the trademark and trade name. The other

aspect which the learned Single Judge has examined

relates to the allegation of suppression of material facts.

The factor which has weighed with the learned Single

Judge is complete suppression in the plaint of the written

agreements dated 19.08.2002 and 20.09.2002 whereby

the appellant agreed to be the authorized stockiest of R-

2. There is neither a whisper of these agreements in the

plaint nor these documents were filed with the plaint.

4. The learned Single Judge thus found the appellant dis-

entitled to any equitable relief of injunction on account of

the deliberate suppression of material facts. The factual

discussion is contained in para 18 of the impugned

judgment, which is reproduced below:

18. The plaintiff, therefore, has disentitled itself to the equitable relief of injunction on account of deliberate suppression of material facts in the plaint as well as suppression of documentary evidence from the scrutiny of this Court. Concealment of material facts or documents deserves to be seriously viewed, for one who comes to the Court owes a duty to the Court to disclose all facts and documents to the Court. The contention of the plaintiff in the instant case that it had disclosed in the plaint that it was purchasing goods from the defendants is neither here nor there. The plaintiff _____________________________________________________________________________________________

deliberately and intentionally, in my view, hid from the Court the fact that the defendant No.2, M/s. PRINCE Auto Industries had been dealing with the same goods, viz. wheel covers and auto accessories and had made a mark in its field of activity well before the plaintiff got registered the trademark 'PRINCE'. The plaintiff also hid from the Court the exact relationship between the plaintiff and the defendants and that there were written agreements to ensure the smooth working of the said relationship duly executed by the parties and registered with the statutory authorities. The reason for suppression of such material facts is clearly discernible. Had the plaintiff stated in the plaint that the defendant No.2 had been in the same field of activity from the year 1998 under the trade name 'PRINCE Automobile Industries' and had the plaintiff further stated in the plaint that it had been working as the authorised stockist of the plaintiff from the year 2001 to the 15th of September, 2004, the plaintiff, in my view, may not have succeeded in obtaining an ex parte ad interim injunction from this Court, which is enuring to the benefit of the plaintiff till date, though with some modification.

5. In our considered view, the learned Single Judge has

applied the correct approach to the matter in question as

it is trite to say that a party approaching the Court must

come with clean hands. The non-disclosure or

concealment of material facts dis-entitles a party to any

relief, more so the discretionary relief of injunction. Had

the relevant fact of prior relationship between the parties

been disclosed of the appellant working as an authorized

stockiest of R-2 from 2001 to 15.09.2004, there was little

chance of obtaining an ex parte injunction. It can hardly

be said that the facts not disclosed were not relevant.

_____________________________________________________________________________________________

The knowledge of these facts with the appellant of course

is not even an issue.

6. It is in these circumstances that the reference to the

judgment of the Supreme Court in S.P.Chengalvaraya

Naidu (Dead) by LRs. v. Jagananath(Dead) by LRs. and

Ors; (1994) 1 SCC 1 (=AIR 1994 SC 853) becomes

relevant and thus any endeavour to withhold a vital

document in order to gain advantage over the other side

would amount to a fraud being played on the Court as

well as on the opposite party.

7. We are of the view that this aspect alone is sufficient to

dis-entitle the appellant to grant of any interim relief.

8. The learned Single Judge has proceeded thereafter to

even analyze the case on merits.

9. The use by the appellant of the trade mark/trade name

'PRINCE' during the currency of the stockiest agreement

was thus without substance and these aspects are fully

supported by contemporaneous documents of competent

authorities including sales tax department. The

documents placed on record by R-2 of almost 70 sample

copies of its bills of sales show the dealing with third

parties from the month of April, 1999 while the appellant

has failed to file any relevant document. Only a few bills

were placed on record by the appellant relating to the

mark 'PRINCE' and these bills (which are four in number)

are subsequent to the year 2005. The sale figures of R-2

_____________________________________________________________________________________________

have been found to be nearly four times the sales figures

of the appellant.

10. Taking into consideration the nature of the products and

the emphasis on 'PRINCE', the trade name and trade

style are almost one and the same and are thus closely

associated in the public mind. The assumption of use of

trademark 'PRINCE' would be that it is manufactured by

'PRINCE Auto Industries'.

11. Interestingly, it is not the respondents who approached

the Court but the appellant filed the suit. Despite having

obtained registration, the appellant cannot be permitted

to appropriate the trademark 'PRINCE' and prevent its

rival trader from using the mark in which the rival trader

'respondents' have prior user.

12. We are, in fact, surprised that after such clear and

undisputed findings about the concealment by the

appellant, the appellant has still traversed the path of

filing an appeal. If one may say, the learned Single

Judge has been more than considerate in only dismissing

the interim application and not the suit since in view of

the observations in S.P.Chengalvaraya Naidu (Dead) by

LRs. v. Jagananath(Dead) by LRs. and Ors' case (supra)

even the suit could have been thrown out on the ground

of such concealment of facts. The parties which choose

to approach the Court with untruths or half-baked truths

must be dealt with firmly and discouraged from pursuing

_____________________________________________________________________________________________

such course of action. The appellant is a prime example

of this.

13. The appeal and the stay application are without merit

and the same are dismissed with costs quantified at

Rs.50,000/- to be paid to the respondents within fifteen

days.

SANJAY KISHAN KAUL, J.

AUGUST 20, 2010                                                 VALMIKI J. MEHTA, J.
dm

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