Vardhman Buildtech Pvt Ltd & Ors vs Vardhman Properties Ltd
2016 Latest Caselaw 5375 Del

        THE HIGH COURT OF DELHI AT NEW DELHI
%                                      Judgment delivered on: 17.08.2016

+       FAO(OS) 187/2016 & CM 23400/2016

VARDHMAN BUILDTECH PVT LTD & ORS                                .... Appellants

                              versus

VARDHMAN PROPERTIES LTD                                         .... Respondent

                                          AND

+       FAO(OS) 188/2016 & CM 23402/2016

VARDHMAN REALTECH PVT LTD & ORS                                 ..... Appellants

                              versus

VARDHMAN PROPERTIES LTD                                         ..... Respondent
Advocates who appeared in this case:
For the Appellants            : Mr Neeraj Grover with Mr Aditya Singh
For the Respondent            : Mr Sanjay Goswami along with Mr Anil Jain,
                                Director of the Respondent Company.

CORAM:
HON'BLE MR. JUSTICE BADAR DURREZ AHMED
HON'BLE MR. JUSTICE ASHUTOSH KUMAR

                                   JUDGMENT

BADAR DURREZ AHMED, J (ORAL)

1. These appeals raise common issues and arise out of the common

judgment dated 31.05.2016 delivered by a learned Single Judge of this

Court in IA No. 21931/2014 in CS(OS) 3378/2014 and IA No. 14073/2013

in CS(OS) 1712/2013. The appellants before us in these appeals were the

defendants in the said two suites, which were filed by the respondent. The

applications referred to above were under Order 39 Rules 1 and 2 read with

Section 151 of the Code of Civil Procedure, 1908 (hereinafter referred to as

‗the CPC'), wherein the respondent/plaintiff had sought ad interim

injunction against the appellants herein restraining them from using the

word ‗VARDHMAN' as a part of their trade mark or their corporate name.

We may point out that these two suits were filed in 2013 and 2014 as

mentioned above. However, there was no injunction granted by the learned

Single Judge till the impugned judgment which was delivered on

31.05.2016. It may be also relevant to note that immediately thereafter the

present appeals were filed and the Vacation Bench, on 10.06.2016, stayed

the operation of the impugned judgment. Prior to that, on an application

moved by the appellants, the learned Single Judge made the order effective

from 11.06.2016.

2. The undisputed fact is that the respondent has a registered mark (a

label mark) which is to the following effect:-

The said mark was registered in Class 37 for building, construction, repair

and allied services. According to the respondent, they have been in the

business of construction and real estate since 1980. The mark was

registered with effect from 22.06.2006.

3. The appellants' case is that they have been using the word

‗VARDHMAN' as part of their corporate names, which are - ‗Vardhman

Estates and Developers Private Limited', ‗Vardhman Buildtech Private

Limited', ‗Vardhman Realtech Private Limited' and ‗Vardhman

Infradevelopers Private Limited'. They have also used the word

‗VARDHMAN' along with their logo, which is given below:-

4. The learned Single Judge, after having heard the counsel for the

parties, allowed both the applications filed by the respondent and, inter

alia, restrained the appellants from using the mark/brand name

‗VARDHMAN' or ‗VARDHMAN PLAZAS' or the corporate name

‗VARDHMAN' or any other mark which was identical or deceptively

similar to the respondent's registered ‗VARDHMAN' label mark which

include the words ‗VARDHMAN PLAZAS'.

5. The entire controversy before us was whether the respondent could

claim exclusivity over the word ‗VARDHMAN', which is the name of

Lord Mahavir. It was the case of the appellants that nobody could

monopolize and claim exclusivity over the word ‗VARDHMAN' and that

the registration of the respondent's trademark was in respect of the entire

label. It was further contended that, if at all, the respondent could claim

exclusivity over part of the label mark, it could only do so in respect of the

words contained therein together, namely, ‗VARDHMAN PLAZAS'. No

exclusivity could be claimed with regard to the part of the words and, in

particular, ‗VARDHMAN', which has commonly been used in several

businesses not restricted to real estate business. It was also submitted by the

learned counsel for the appellants that there are over 300 companies

registered with the Registrar of Companies whose corporate names include

the word ‗VARDHMAN'. Therefore, it was contended that the respondent

cannot claim exclusivity over the word ‗VARDHMAN'. The learned

counsel for the appellants also made submissions based on Section 17 of

the Trade Marks Act, 1999 (hereinafter referred to as ‗the said Act').

6. The learned counsel for the respondent, however, contended that the

registration of the label/mark, which includes the words ‗VARDHMAN

PLAZAS' would entitle them to claim exclusivity over the distinctive

element of the mark which, according to him, was ‗VARDHMAN'. Strong

reliance was placed on Section 29(9) of the said Act. Reliance was also

placed by the learned counsel for the respondent on the decision of the

Supreme Court in Ramdev Food Products Pvt. Ltd. v. Arvindbhai

Rambhai Patel and Others: AIR 2006 SC 3304 as also on a Division

Bench decision of this Court in United Biotech Pvt. Ltd. v. Orchid

Chemicals & Pharmaceuticals Ltd. and Others: 2012(4) R.A.J. 677 (Del).

7. We have considered the arguments of the learned counsel for the

parties. Before we consider the rival contentions, it would be necessary to

set out the relevant provisions of the said Act, which read as under:-

―15. Registration of parts of trade marks and of trade marks as a series - (1) Where the proprietor of a trade mark claims to be entitled to the exclusive use of any part thereof separately, he may apply to register the whole and the part as separate trade marks.

(2) Each such separate trade mark shall satisfy all the conditions applying to and have all the incidents of, an independent trade mark.

(3) Where a person claiming to be the proprietor of several trade marks in respect of the same or similar goods or services or description of goods or description of services, which, while resembling each other in the material particulars thereof, yet differ in respect of -

(a) statement of the goods or services in relation to which they are respectively used or proposed to be used; or

(b) statement of number, price, quality or names of places; or

(c) other matter of a non-distinctive character which does not substantially affect the identity of the trade mark; or

(d) colour, seeks to register those trade marks, they may be registered as a series in one registration.‖

―17. Effect of registration of parts of a mark. - (1) When a trade mark consists of several matters, its registration shall confer on the proprietor exclusive right to the use of the trade mark taken as a whole.

(2) Notwithstanding anything contained in sub-section (1), when a trade mark -

(a) contains any part -

(i) which is not the subject of a separate application by the proprietor for registration as a trade mark; or

(ii) which is not separately registered by the proprietor as a trade mark; or

(b) contains any matter which is common to the trade or is otherwise of a non-distinctive character, the registration thereof shall not confer any exclusive right in the matter forming only a part of the whole of the trade mark so registered.‖

―28. Rights conferred by registration - (1) Subject to the other provisions of this Act, the registration of a trade mark shall, if valid, give to the registered proprietor of the trade mark the exclusive right to the use of the trade mark in relation to the goods or services in respect of which the trade mark is registered and to obtain relief in respect of infringement of the trade mark in the manner provided by this Act.

(2) The exclusive right to the use of a trade mark given under sub-section (1) shall be subject to any conditions and limitations to which the registration is subject.

(3) Where two or more persons are registered proprietors of trade marks, which are identical with or nearly resemble each other, the exclusive right to the use of any of those trade marks shall not (except so far as their respective rights are subject to any conditions or limitations entered on the register) be deemed to have been acquired by any one of those persons as against any other of those persons merely by registration of the trade marks but each of those persons has otherwise the same rights as against other persons (not being registered users using by way of permitted use) as he would have if he were the sole registered proprietor.

29. Infringement of registered trade marks. - (1) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which is identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark.

(2) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which because of-

(a) its identity with the registered trade mark and the similarity of the goods or services covered by such registered trade mark; or

(b) its similarity to the registered trade mark and the identity or similarity of the goods or services covered by such registered trade mark; or

(c) its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark.

(3) In any case falling under clause (c) of sub-section (2), the court shall presume that it is likely to cause confusion on the part of the public.

(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which-

(a) is identical with or similar to the registered trade mark; and

(b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and

(c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark.

(5) A registered trade mark is infringed by a person if he uses such registered trade mark, as his trade name or part of his trade name, or name of his business concern or part of the name, of his business concern dealing in goods or services in respect of which the trade mark is registered.

(6) For the purposes of this section, a person uses a registered mark, if, in particular, he-

(a) affixes it to goods or the packaging thereof;

(b) offers or exposes goods for sale, puts them on the market, or stocks them for those purposes under the registered trade mark, or offers or supplies services under the registered trade mark;

                (c)      imports or exports goods under the mark; or

                (d)      uses the registered trade mark on business papers
                         or in advertising.

(7) A registered trade mark is infringed by a person who applies such registered trade mark to a material intended to be used for labelling or packaging goods, as a business paper, or for advertising goods or services, provided such person, when he applied the mark, knew or had reason to believe that the application of the mark was not duly authorised by the proprietor or a licensee.

(8) A registered trade mark is infringed by any advertising of that trade mark if such advertising--

(a) takes unfair advantage of and is contrary to honest practices in industrial or commercial matters; or

(b) is detrimental to its distinctive character; or

(c) is against the reputation of the trade mark.

(9) Where the distinctive elements of a registered trade mark consist of or include words, the trade mark may be infringed by the spoken use of those words as well as by their visual representation and reference in this section to the use of a mark shall be construed accordingly.‖

8. On a plain reading of Section 15(1), it is evident that where a

proprietor of a trade mark claims to be entitled to the exclusive use of any

part thereof separately, he is permitted to apply to register the whole and

the part as separate trade marks. In the present case, the respondent is the

proprietor of the label/mark which includes the words ‗VARDHMAN

PLAZAS'. The respondent is claiming exclusivity in respect of the word

‗VARDHMAN'. It is clear that he had the option to make an application

for registering the word ‗VARDHMAN' as a separate trade mark.

Assuming that he could have had the word mark registered, it is an

admitted fact that the respondent made no such application. Section 17 of

the said Act makes it clear when a trade mark consists of several matters, as

it does in the present case, its registration shall confer on the proprietor

exclusive right to the use of the trade mark taken as a whole. There is no

dispute that the label/mark, taken as a whole, is the exclusive property of

the respondent. The learned counsel for the appellants has no quarrel with

this at all. The issue arises when the respondent claims exclusive right to a

part of the label/mark and particularly to the word ‗VARDHMAN'.

Section 17(2) is a non-obstante provision [vis-à-vis sub-section(1)], which

stipulates that when a trade mark contains any part which is not the subject

matter of a separate application by the proprietor for registration as a trade

mark or which is not separately registered by the proprietor as a trade mark

or contains any matter which is common to the trade or is otherwise of a

non-distinctive character, the registration thereof shall not confer any

exclusive right in the matter forming only a part of the whole of the trade

mark so registered. In the present case, neither has the respondent

separately registered ‗VARDHMAN' as a trade mark nor has any such

application been made. Furthermore, the word ‗VARDHMAN' is itself of

a non-distinctive character and is not only common to this trade but to

several other businesses. Consequently, the registration of the label/mark

which contains the words ‗VARDHMAN PLAZAS' does not confer any

exclusive right on the respondent insofar as a part of that mark, namely,

‗VARDHMAN' is concerned.

9. We now come to Section 28 of the said Act which deals with the

rights conferred by registration. It is clear that by virtue of Section 28, the

registration of a trade mark, if valid, gives to the registered proprietor of the

trade mark the exclusive right to the use of the mark in relation to the goods

or services in respect of which the trade mark is registered and, importantly,

to obtain relief in respect of infringement of the trade mark in the manner

provided by the Act. What is important to notice is that Section 28(1)

begins with the words ‗subject to the other provisions of this Act'. In other

words, Section 28 would have to be read as subject to Section 17 of the said

Act. Consequently, in our opinion the registration of the label/mark in

favour of the respondent, which includes the words ‗VARDHMAN

PLAZAS', does not confer an exclusive right on the respondent insofar as

part of the mark, which has reference to the word ‗VARDHMAN', is

concerned.

10. The learned counsel for the respondent, as pointed out above, sought

to take the benefit of Section 29(9) of the said Act. That provision

stipulates that where ‗distinctive elements' of a registered trade mark

consist of or include words, the trade mark may be infringed by the spoken

use of those words as well as by their visual representation and the

reference in Section 29 to the use of a mark is to be construed accordingly.

First of all, the stress in the said provision is on the words ‗distinctive

elements'. Neither is ‗VARDHMAN' nor the word ‗PLAZAS' a

distinctive element of the trade mark. The word ‗VARDHMAN' has not

been registered as a trade mark nor could it be because it is commonly used

and, as pointed out above, is the name of Lord Mahavir. Secondly, the

word ‗PLAZAS' is also commonly used and cannot be appropriated by the

respondent. Therefore, the distinctive elements are neither the word

‗VARDHMAN' nor the word ‗PLAZAS'. But, the two words taken

together - ‗VARDHMAN PLAZAS' - is a distinctive element of the

label/mark. Thus, if the appellants were to use words ‗VARDHMAN' and

‗PLAZAS' in conjunction, then the respondent may have had a right to

restrain them from using the same. We are, therefore, of the view that

Section 29(9) of the said Act also does not come in aid of the respondent.

11. The decision of the Supreme Court in Ramdev Food Products Pvt.

Ltd (supra) was in respect of the Trade Marks Act, 1958 and not in respect

of the Trade Marks Act, 1999. This is the most important distinguishing

feature apart from others which we need not refer to. Insofar as the

decision of the Division Bench in United Biotech Pvt. Ltd (supra) is

concerned, in that case, the registered trademark was ‗ORZID' and the

infringing word was ‗FORZID'. Clearly that was a case which would fall

under Section 29 as amounting to infringement of the registered trade mark

‗ORZID'. Although, in that case also the mark which was registered was

not a word mark but a label/mark which contained only the word ‗ORZID'.

Here, the words contained in the label/mark are ‗VARDHMAN PLAZAS'

and not just ‗VARDHMAN'. Therefore, in our view, the decision in

United Biotech Pvt. Ltd (supra) does not aid the arguments advanced by

the learned counsel for the respondent.

12. In view of the foregoing discussion, the appeals are allowed. The

impugned judgment is set aside. We are making it clear that all

observations made by us in this judgment are prima facie in nature and

shall not be taken into account at the time of trial of the suits before the

learned Single Judge.

                                      BADAR DURREZ AHMED, J



AUGUST 17, 2016                            ASHUTOSH KUMAR, J
SR