Delhi High Court
Cargill India Pvt. Ltd. vs Quality Agro Mills Pvt. Ltd. on 20 March, 2014
$~F-5.
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 3305/2012
% Judgment dated 20.03.2014
CARGILL INDIA PVT LTD ..... Plaintiff
Through : Mr.Pravin Anand and Ms.Saukshmya,
Advs.
versus
QUALITY AGRO MILLS PVT LTD. ..... Defendants
Through :
CORAM:
HON'BLE MR. JUSTICE G.S.SISTANI
G.S.SISTANI, J. (Oral)
1. Plaintiff has filed the present suit for permanent injunction restraining
infringement of trade mark, passing off, damages, delivery up, etc.
2. Summons in the suit were issued vide order dated 23.11.2012, when an ex
parte ad interim injunction was granted in favour of the plaintiff and
against defendant thereby directing that till further orders defendant is
restrained from selling, marketing or advertising Atta, Maida, Rawa, Sooji
and Besan under the name „Nature Fresh‟ or any other name, which
would constitute infringement of the registered trade mark of the plaintiff.
It may be noticed that in the order dated 19.7.2013 the Court had noticed
that the defendant had shifted its address mentioned in the plaint more
than 1½ years ago. The Court directed the plaintiff to ascertain the present
address of the defendant and file it in the Registry to enable the Registry
to issue fresh summons in the suit and notice in the application. Since the
defendant could not be served through ordinary service despite repeated
efforts, the plaintiff filed I.A. No.13655/2013 under Order V Rule 20 CPC
for substituted service. The said application was allowed and the
defendant was directed to be served by way of publication. On 2.1.2014,
the Court noticed that the defendants were served and a copy of
publication notice was also placed on record. Since none appeared on
behalf of the defendant on 16.1.2014 and 22.1.2014 despite service
through publication, the defendant was proceeded ex parte on 22.1.2014
and the interim order dated 23.11.2012 was confirmed. Plaintiff was also
directed to file ex parte evidence by way of affidavit.
3. Plaintiff has filed the affidavit by way of evidence of Mr. Vikram Anand,
Head Marketing of the plaintiff company, which is exhibited as Ex.PW-
1/A. PW-1 has deposed that he is the Head Marketing of the plaintiff and
is duly authorized and competent to take all necessary legal actions in the
present suit. Copy of the Board Resolution dated 07.02.2012 in favour of
PW-1 has been exhibited herewith as Ex. PW-1/1. He has further deposed
that the plaintiff is duly incorporated under the Companies Act, 1956,
having its registered office at 111, Rectangle 1, District Center Saket,
New Delhi. Copies of the Memorandum and Articles of Association of the
plaintiff comprising of the copy of the Certificate of Incorporation have
been exhibited as Ex. PW-1/2 and Ex. PW-1/3 respectively.
4. PW-1 has next deposed that the plaintiff is the registered proprietor of the
trademark "NATUREFRESH" and its variants including NatureFresh
label comprising of the combination of words NATURE and FRESH as
an essential feature thereof. Details of various Trade Marks registered in
favour of the plaintiff are as under:
Trade Mark App. No Date Class Goods
906711 29/2/00 30 Atta, Maida, Rawa,
Sooji, Besan
NatureFresh 1039112 23/08/01 29 Meat, Fish, Poultry and
Game; Meat Extracts;
Preserved and Dried and
Cooked fruits and
Vegetables; Jellies, Jams;
Egg, Milk and other
Dairy products; edible
oils and fats;
preservatives and pickles,
Dried and sun dried
vegetables and fruits
NatureFresh 1323902 13/12/04 29 Edible Oils
Label
1325096 10/12/04 29 Edible Oils
1325098 10/12/04 29 Edible Oils
NatureFresh 1570519 20/06/07 29, Class 29: Meat, fish,
Label 30 poultry and game; meat
and extracts; preserved dried
31 and cooked fruits and
vegetables; etc.
Class 30: Coffee, tea,
cocoa, sugar, rice,
tapioca, sago, artificial
coffee; flour and
preparations made from
cereals, bread, pastry and
confectionery etc.
Class 31: Agricultural,
horticultural and forestry
products and grains not
included in other classes
etc.
5. Certificates for use in legal proceedings for trademark registration nos.
906711, 1039112, 1323902, 1325096 and 1325098 have been exhibited
from Ex. PW-1/4 to Ex. PW 1/8. A copy of the registration certificate for
trademark registration no. 1570519 has been exhibited as Ex. PW-1/9.
6. PW-1 has deposed that plaintiff has also applied for various trademarks
bearing the mark "NATUREFRESH" and its variants under numbers
1024539 (NatureFresh and Logo), 1835472 (NatureFresh Oliante),
1570518 (NatureFresh Sarvottam), 1865631 (NatureFresh Acti-Lite) etc.
that are pending registrations. Copy of Journal extracts evidencing the
advertisement of these pending applications have been exhibited as Ex.
PW-1/12.
7. Mr.Vikram Anand, PW-1 has deposed that besides the above
registrations, plaintiff is the assignee for valuable consideration of the
trademark nos. 1039111, 1039112 and 1039113 along with the goodwill
of the business of one Mr. Kirtikumar Rasiklal Amin trading as M/s.
NatureFresh from November 1988 vide Deed of Assignment dated
20.06.2005. A copy of the Deed of Assignment is exhibited as Ex. PW-
1/10. PW-1 has also deposed that the trademark "NATUREFRESH" has
been in use by its erstwhile proprietor way back from November 1988.
The copy of the documents received by plaintiff from the assignor of the
trademark "NATUREFRESH" evidencing the use of the mark by it since
1988 in accordance with the assignment deed dated 29.06.2005 have been
collectively exhibited as Ex. PW-1/11.
8. Mr. Vikram Anand has also deposed that the plaintiff originally launched
its processed food articles business back in June 2000 in wheat flour
(atta), refined flour (maida), semolina (suji), gram flour (besan), edible
oils and salts all under the brand name "NATUREFRESH". Various
representations of plaintiff‟s brands bearing the trademark
"NATUREFRESH" have been exhibited as Ex. PW-1/13.
9. PW-1 has further deposed that plaintiff‟s aforesaid packaged food articles
are sold under the trademark "NATUREFRESH", which was adopted in
June 2000. Plaintiff launched a high profile and aggressive advertising
and sales promotion campaign for the "NATUREFRESH" brand soon
after its adoption. PW-1 deposed that this campaign created tremendous
consumer awareness of the said trademark and ensured a strong
association of the same with plaintiff‟s goods in the minds of the
consuming public and the trade.
10. PW-1 has also deposed that edible oil business of plaintiff which earlier
comprised world class refineries owned by three corporate entities namely
Cargill India Private Limited in Paradip, Orissa; Global Oils & Fats
Limited in Kandla in Kutch Region, Gujarat; and Cargill Foods India
Limited in Kurkumbh near Pune, Maharashtra was merged with effect
from 22.09.2008. Consequent to such merger/amalgamation the food
flavor business which was carried on under the name of „Duckworth
Flavours India Private Limited and the business of animal nutrition
products which was carried on under the name of „Cargill Matrix Feeds
Private Limited‟ came to exist under the name of plaintiff namely „Cargill
India Private Limited‟. PW-1 has further deposed that the food flavour
business which was carried on in the name of the plaintiff has been sold
off globally as a going concern as a slump sale basis to Kerry Group PLC
in November, 2011. Copies of documents evidencing such merger and
amalgamation have been exhibited as Ex. PW-1/14.
11. PW-1 has next deposed that the plaintiff has spent enormously to the tune
of Rs 28 Crores on marketing and promotional expenses for the goods
bearing the mark "NATUREFRESH" from the period June, 2008 to
March, 2012. He has further deposed that the plaintiff has made huge
sales of its products under the mark "NATUREFRESH" for the period
from June, 2008 to March, 2012 which have amounted to approximately
2621 crores. The sales and advertisement figures of the plaintiff‟s
products for the period June,2008 to March, 2012 are given as under:
Period -Year Turnover Marketing &
Promotional
Expenses
June-8 to May-09 524,29,62,676 6,07,38,927
June-09 to May-10 579,65,01,784 10,34,74,446
June-10 to May -11 764,15,85,470 7,80,07,631
June-11 to March- 753,00,86,631 4,29,40,692
12. Certificate from Chartered Accountant authenticating the above figures
has been exhibited as Ex. PW-1/15. Copies of the annual reports of the
plaintiff have been exhibited as Ex. PW-1/16.
13. PW-1, Mr. Vikram Anand, has further deposed that the consumers
associate the trademark "NATUREFRESH" solely with the plaintiff
which primarily is because of its unique and refreshing packaging of its
individual products under the said trademark "NATUREFRESH" such as
atta, suji, maida, salt, oil etc. The packaging of plaintiff‟s products
comprises a distinctive get up, lay out, arrangement of features and colour
schemes, designed for and on its behalf by the advertising agency
Hindustan Thomson Associates (HTA) for valuable consideration.
Document evidencing the business engagement letter with the advertising
agency has been exhibited as Ex. PW-1/17.
14. PW-1 has also deposed that the trademark "NATUREFRESH" has
received extensive publicity in the print and audio visual media.
Plaintiff‟s products under the said trademark have been introduced
virtually in all corners of India and enjoy great acceptance and command
substantial brand loyalty by virtue of its sales and marketing efforts. PW-
1 has further deposed that the mark "NATUREFRESH" which belongs to
the plaintiff has also been widely covered in trade literature and journals
and thus the same has resulted in tremendous awareness of the mark
"NATUREFRESH" in India. Copies of various journals, publicity
material in form of pamphlets, brochures, in-house journals have been
exhibited as Ex. PW-1/18.
15. PW-1 has further deposed that not only the plainitff‟s
"NATUREFRESH" products are extremely popular but are also a
household name across India and have come to be exclusively associated
with the plaintiff and no one else. Online news reports evidencing the
huge presence of Plaintiff‟s "NATUREFRESH" products have been
exhibited as Ex. PW-1/20.
16. This witness has next deposed that the plaintiff‟s rights in the trademark
"NATUREFRESH" are valid and subsisting and have been legally
enforced successfully by way of settlement in Suit No. 1330/ 2003
between, Dabur Foods Limited, Dabur India Limited and Cargill India
Private Limited. The defendants in the said suit i.e. Dabur Foods Limited
undertook before the Hon‟ble Delhi High Court to completely discontinue
use of the word "NATUREFRESH" in relation to their "REAL" fruit
juice packaging and also agreed to withdraw all ongoing opposition
proceedings filed by them against the "NATUREFRESH" marks in the
Intellectual Property Appellate Board, Chennai. PW-1 has also deposed
that the Defendants also paid damages to the tune of Rs Twenty Lakhs
acknowledging plaintiff‟s exclusive right in the trademark
"NATUREFRESH". Copy of the Order passed in CS (OS) 1330 of 2003
has been exhibited as Ex. PW-1/19.
17. In the affidavit, PW-1 has deposed that in the month of October, 2012
plaintiff learnt and was appalled to find that the defendant was blatantly
manufacturing, marketing, selling and distributing wheat flour bearing the
trade mark "NATUREFRESH" which belongs to the plaintiff. A sample
of the defendant‟s product packaging bearing the mark
"NATUREFRESH" for Atta has been exhibited as Ex. PW-1/22.
18. PW-1 has further deposed that the defendant has registered the domain
name www.naturefresh.webs.com incorporating plaintiff‟s well known
trademark "NATUREFRESH" in its entirety. It is also deposed by PW-1
that the mala fide intention of the defendant is evident from the fact that
not even a single letter differs between the disputed domain name and the
trademark of the plaintiff. PW-1 has deposed that there is a great
likelihood that an actual or potential visitor to the plaintiff‟s web page
may be directed to the defendant‟s website and will be malafidely induced
to believe that the plaintiff has some connection with the defendant in
terms of a direct nexus or affiliation with the plaintiff or has been
authorized by the plaintiff. Extracts from the defendant‟s website have
been exhibited as Ex. PW-1/23.
19. It is also deposed by PW-1 that the adoption and use of the trademark
"NATUREFRESH" by the defendant in relation to Atta being food article
amounts to infringement and passing off of plaintiff‟s well-known
trademark "NATUREFRESH" registered under Nos. 906711, 1039112,
1323902, 1325096, 1325098 and 1570519. PW-1 has further deposed
that the dishonest misrepresentation on the part of the defendant is
calculated to injure plaintiff‟s trade and business and cause monetary loss
and irreparable injury to plaintiff‟s business goodwill and reputation. PW-
1 has also deposed that the defendant has caused losses to the plaintiff as
the plaintiff company would have earned profits if the defendant had not
blatantly manufactured, marketed and distributed Atta bearing the
trademark "NATUREFRESH" for which the defendant is liable to pay
damages to the tune of Rs. 20 lacs.
20. I have heard learned counsel for the plaintiff and also perused the plaint,
the accompanying documents and the evidence led by the plaintiff. On the
basis of the evidence which has remained unrebutted, the plaintiff has
been able to establish that the plaintiff is the registered proprietor of the
trade-mark "NATUREFRESH" in class 29 and 30 of the Trademarks Act
for description of goods including flour and preparations made from
cereals, meat, fish, poultry, cooked fruits and vegetables. Plaintiff has also
placed on record six trademark certificates issued to the plaintiff for use in
legal proceedings, which have been exhibited from Ex.PW-1/4 to Ex.
PW-1/9. The plaintiff has also established that they are the users of the
trademark "NATUREFRESH" since the year 2005 when the erstwhile
proprietor had assigned the trademarks rights to the plaintiff. Copy of
assignment deed dated 29.06.2005 has been exhibited as Ex. PW-1/10.
The plaintiffs have also established the fact that packaging of their
product comprises a distinctive get up, lay out, arrangement of features
and colour scheme which constitutes an original artistic work within the
meaning of section 2(c) of the Copyright Act, 1957. The plaintiff has also
relied upon the certificate of the Chartered Accountant, certifying the
sales and marketing expenses of its products under the mark
"NATUREFRESH" for the period from June, 2008 to March, 2012,
which has been exhibited as Ex-PW1/15, to prove that the plaintiff‟s
products are extremely popular and hence resulting in substantial sales
turnover annually. The plaintiff has also been able to establish that due to
the continuous and extensive use of the trademark "NATUREFRESH" by
it over a long period of time, coupled with vast promotion and publicity,
the said mark enjoys an unparalleled reputation and goodwill in the
market and has acquired the status of a well known mark.
21.In a very recent judgment delivered by another bench of this court, Mind
Gym Ltd.v. Mindgym Kids Library Pvt. Ltd CS (OS) 1029/2013, decided
on 21.03.2014, plaintiffs who were carrying on business under the trade
mark „MIND GYM‟ sought permanent injunction against the defendants
restraining them from infringing and/or passing off the plaintiff's rights by
using the trademark „MINDGYM‟ as part of latter‟s corporate
name/trademark. Following observations were made by the court:
"9........
(ii) In the case of Evergreen Sweet House Vs. Ever Green and
Ors., 2008 (38) PTC 325 (Del), it was observed as under:
15. A mark, is said to be deceptively similar to another (Section
2(1) (h), Trademarks Act, 1999) if it so nearly resembles that
other mark as to be likely to deceive or cause confusion. Section
29(1) deals with a situation where the defendant uses a mark,
which is identical or deceptively similar to that of the plaintiff,
in respect of the same goods or services, and in such manner that
it is likely that such use is taken as being an use as a trademark.
This amounts to infringement. To fall within Section 29(1), the
defendant's use of the mark must be so that it is likely that the
public assumes that the said mark is used as a trademark.
Section 29(2) deals with three situations; one where the
defendants mark is identical to that of the plaintiff and in respect
of similar goods. Two, where the marks are similar and in
respect of goods which are identical or similar. Three, the marks
as well as the goods are identical. Infringement does not take
place if only one of the three ingredients are satisfied; the
plaintiff has to prove that use by the defendant is likely to cause
confusion on the part of the public or is likely to have an
association with the registered mark.
[Emphasis Supplied]
22. The Apex Court in the case of Laxmikant V Patel v. Chetanbhai Shah
And Another reported at (2002) 3 SCC 65, has laid down the test of
confusion/deception in order to prove the case of passing off. Relevant
para of the aforesaid judgment reads as under:-
"A person may sell his goods or deliver his services such as in case
of a profession under a trading name or style. With the lapse of
time such business or services associated with a person acquire a
reputation or goodwill which becomes a property which is
protected by courts. A competitor initiating sale of goods or
services in the same name or by imitating that name results in
injury to the business of one who has the property in that name. The
law does not permit any one to carry on his business in such a way
as would persuade the customers or clients in believing that the
goods or services belonging to someone else are his or are
associated therewith. It does not matter whether the latter person
does so fraudulently or otherwise. The reasons are two. Firstly,
honesty and fair play are, and ought to be, the basic policies in the
world of business. Secondly, when a person adopts or intends to
adopt a name in connection with his business or services which
already belongs to someone else it results in confusion and has
propensity of diverting the customers and clients of someone else to
himself and thereby resulting in injury."
[Emphasis Supplied]
23.In the case of M/S Kee Pharma Ltd. v M/s Big M Healthcare & Anr.
reported at 2012(50)PTC501(Del), wherein the defendant has adopted and
was carrying on business under the same/identical trademark as the
plaintiff i.e. "DISER", with respect to the same product i.e. medicinal
preparations, following observations were made by the court:-
"The trade-mark DISER is identical and deceptively similar to the
plaintiff's trademark structurally, visually and phonetically and
there is no justification for the defendant adopting the impugned
trade mark DISER, but to deprive the plaintiff of the profits by
misappropriating the goodwill and reputation that also subsists in
the plaintiff's trade mark. The facts of this case reveal that the
conduct of the defendant is mala fide, dishonest, unethical and
unlawful and solely motivated to encash upon the goodwill and
reputation of the plaintiff's trademark DISER and to earn easy and
illegal profits by passing off its medicinal preparations for those of
the plaintiff. The act of the defendant is also likely to tarnish the
plaintiff's goodwill and reputation and constitutes act of passing off
unfair competition.
[Emphasis Supplied]
24. Having regard to the evidence on record and comparing the impugned
product of the defendant, photograph of which has been exhibited as Ex.
PW-1/22, I am of the view that the impugned product of the defendant is
almost identical and phonetically and deceptively similar to the plaintiff's
product. The use of the word "NATUREFRESH" by the defendant is
likely to dilute the distinctive character of the plaintiff's trademark
"NATUREFRESH" and the same is likely to erode the goodwill and
reputation of the plaintiff among its existing as well as potential
customers in the market. The adoption and use of the identical trademark
by the defendant in relation to identical products and advertising the same
through websites amounts to an infringement of the plaintiff‟s statutory
rights in the registered trademark "NATUREFRESH". I am of the opinion
that the defendant is also guilty of passing off as by using an identical
mark as that of the plaintiff, the defendant is misrepresenting to the
purchasing public that it is selling its goods in association with/in
connection with the plaintiff and thus causing confusion as to the source
of the goods and passing off his goods as that of the plaintiff.
Furthermore, the defendant in a mala fide, dishonest and an unethical
manner is encashing upon the goodwill and reputation of the plaintiffs
established by the latter over the period of many years.
25. The plaintiff has also claimed damages on account of illegal activities of
the defendant along with delivery up of the goods bearing the impugned
trade mark, or any other deceptively similar mark. The plaintiff has also
prayed for rendition of accounts of profits earned by the defendant on
account of use of the impugned trade mark.
26.Perusal of the order sheets reveals that the defendant has deliberately
stayed away from the present proceedings with the result that an enquiry
into the accounts of the defendant for determination of damages cannot
take place. In the case of Time Incorporated v. Lokesh Srivastava and
Anr reported at 2005 (30) PTC 3 (Del), apart from compensatory damages
of Rs.5 lakhs, punitive damages were also been awarded. See also Hero
Honda Motors Limited v. Rafiq Memon [2012 (52) PTC 449 (Del.)];
Gora Mal Hari Ram Ltd. Vs. Ashique Exports [2012 (50) PTC 428
(Del.)]; Relaxo Rubber Limited and Anr. Vs. Selection Footwear and
Anr. [1999 PTC 578].
27.I am in agreement with the aforesaid submission of learned counsel for
the plaintiff that damages in such cases must be awarded and a defendant,
who chooses to stay away from the proceedings of the Court, should not
be permitted to enjoy the benefits of evasion of court proceedings. Any
view to the contrary would result in a situation where a defendant who
appears in Court and submits its account books would be liable for
damages, while another defendant who, chooses to stay away from court
proceedings would escape the liability on account of failure of the
availability of account books. A party who chooses not to participate in
court proceedings and stays away must, thus, suffer the consequences of
damages as stated and set out by the plaintiffs. There is a larger public
purpose involved to discourage such parties from indulging in such acts of
deception and, thus, even if the same has a punitive element, it must be
granted. R.C. Chopra, J. has very succinctly set out in Time
Incorporated's case (supra) that punitive damages are founded on the
philosophy of corrective justice.
28. For the reasons stated above, the plaintiff has made out a case for grant of
decree as prayed in the plaint. Accordingly, the order dated 23.11.2012 is
confirmed and the suit is decreed in favour of the plaintiff and against the
defendant. Plaintiff is also entitled to damages to the tune of Rs.5.0 lacs.
29. Decree sheet be drawn up accordingly.
(G.S.SISTANI)
JUDGE
MARCH 20, 2014
msr /2
