M/S Orient Ceramics And ... vs Square Ceramic Private Ltd & Ors
2017 Latest Caselaw 5979 Del

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*    IN THE HIGH COURT OF DELHI AT NEW DELHI
%                                   Reserved on: 23rd October, 2017
                                   Pronounced on: 30th October, 2017

+    CS(OS) No.110/2011

     M/S ORIENT CERAMICS
     AND INDUSTRIES LTD                               ..... Plaintiff
                   Through          Mr.Anshuj Dhingra, Mr.Kartik
                                    Sethi, Advs. with AR of the
                                    plaintiff.
                          Versus

     SQUARE CERAMIC PRIVATE LTD & ORS       ..... Defendants
                 Through  None being ex parte.

     CORAM:
     HON'BLE MR. JUSTICE YOGESH KHANNA

     YOGESH KHANNA, J.

1. The plaintiff seeks decree for permanent injunction restraining the defendants, their directors, agents, assignees, distributors, servants or any other person claiming under or through them from in any manner dealing with, manufacturing, exporting, selling, offering for sale, exhibiting, advertising, directly or indirectly dealing with tiles or cognate/allied goods under the trade mark of the plaintiff company "ORIENT" or any other identical/deceptively similar mark of the plaintiffs mark "ORIENT" including deceptively similar name "ORIƎNTO" amounting to passing off the defendant's goods as and those of the

Plaintiff and also seeking a decree for an amount of Rs.50,00,000/- on account of damages on the following averments:-

(a) the plaintiff company i.e. Orient Ceramics and Industries Limited alleges to be market leader in manufacturing and sale of premium quality ceramic and vitrified tiles throughout India with reputed ISO 9001:2008 and engaged in the manufacturing of tiles, which are used on walls &floors of buildings, houses and hotels (Bathrooms, kitchens and even in living rooms, bedrooms, etc.) and sell it under trade mark/name "ORIENT TILES";

(b) the defendant No.1 is a company incorporated in Gujarat and is engaged in the trade of manufacturing and sale of ceramic tiles and other ceramic products throughout Gujarat and other parts of India including Delhi. The defendant no. 2 and 3 are directors of the defendant no. 1 company. The defendants are trying to use goodwill generated by the plaintiff company over a period of time by using a deceptively similar trade mark "ORIƎNTO TILES" for it's tiles;

(c) the word 'ORIENT' is an integral part of the corporate name of the plaintiff company since 1977. The plaintiff company adopted a trade mark "ORIENT TILES" and is continuously and uninterruptedly using it since the year 1982 and the same was registered as Trade Mark no. 1374747 dated 01.08.2005 vide trade mark registry no. 720695. The plaintiff company is also within its rights under the Copyright Act, 1957 to seek legal remedy against infringement of its copyright. The plaintiff company has grown to become one of the leading manufacturers of tiles in India which

was used in kitchens, bathrooms, homes and offices and the trade mark "ORIENT TILES" is printed on the reverse side of each tile and plaintiff company has spent a large amount of money on publicity and advertisement of the trade mark "ORIENT TILES" to popularize the same and said tiles are designed by internationally acclaimed Spanish Designers and involved huge amount in research and development and advertisement and people have come to believe that any product manufactured by the plaintiff company bearing the Trade Mark "ORIENT TILES" would be of excellent quality and material;

(d) in the month of March it was observed by the plaintiff company in Trade Mark Journal No.1411 dated 01.03.2009 that defendant no.1 had applied for Trade Mark under the deceptively similar trade name "ORIƎNTO TILES". In this regard, the plaintiff company contacted its Registration agents "Bharti Registration Service" New Delhi and asked them to inquire into the matter. In the meantime, the plaintiff company also directed its agents to file its opposition under section 21, 64, 66, 73 Rules 47(1), 131(1) and 138(1) of the Trade Marks Act, 1999 against the grant of Trade Mark to defendant no.1. Thereafter, the sales and marketing personnel of the plaintiff company inquired and made queries in the local market at Delhi and other areas of operation of the plaintiff company across the country and it came to the knowledge of the plaintiff company that the defendant no.1 recently put up advertisement hoardings at these places and has recently clandestinely started selling the tiles under trade mark

"ORIƎNTO";

(e) the malafide intent on part of the defendants can be established from the fact that the defendant had tried to cleverly take advantage of Trade Mark "ORIENT" and simply reversed the letter "E" used in word ORIENT. Since there is no such word in English Language, therefore, the same would be read as ORIENT only. Further, he has added word "O" at the end of word "ORIENT" and also added a symbol "C" to it and therefore gave a look as if "O" is separate of ORIENT which would create deception and confusion in the minds of the prospective purchasers of the tiles. The defendant is also using email ID for contact as [email protected] in which orient word is clearly visible and that email ID is holding substantive part of the advertisement, sufficient enough to give deception and confusing impression to the consumer that Orient brand is related to it. The defendants are deliberately using predominantly green, black and white combination which is used by the plaintiff in depicting its brand name "ORIENT" in blatant and open violation of the copyright granted to the plaintiff company; hence this suit.

2. The defendants were proceeded ex-parte even before framing of issues, therefore evidence by way of affidavit was filed by the plaintiff company. The plaintiff has duly proved that it has been continuously and uninterruptedly using the trademark 'ORIENT TILES' since 1982 and the trademark was registered as Trademark no. 1374747 dated 01.08.2005 vide trademark registry no. 720695 and the same is exhibited as Exhibit PW 1/3. The

trademark 'ORIENT TILES' is printed on the reverse side of each tile and the sample photograph of the said tile is exhibited as Ex PW 1/4. The plaintiff has also devised an artistic logo of the company titled as 'ORIENT TILES' and has thus claimed copyright in both the artistic work and the same are original and the copyright Registration no.bearing A-68840/2005 dated 14.03.2005 for 'ORIENT TILES' is exhibited as PW-1/7. Since by the extensive sale of tiles under the trademark 'ORIENT TILES', the plaintiff has done high quantum of business and the sale invoices are exhibited as Ex. PW-1/5 [Colly.] and as such the plaintiff company had spent huge amount on expenditure, the photographs of hoardings depicting the trademark 'ORIENT TILES' is exhibited as PW-1/6. The trademark 'ORIENT TILES' is associated with the goods of the plaintiff exclusively and people know that the plaintiff company is the manufacturer and promoter of the said trademark. Due of adoption of the trade name in 1977 and the trademark 'ORIENT TILES' in 1992, the said trademark is exclusively associated with the plaintiff company.

3. The plaintiff also proved that when the defendant no.1 in the month of March applied in the trademark Journal No.1411 dated 1.03.2009 for deceptively similar trademark "ORIƎNTO TILES', the plaintiff company filed opposition under the provisions of the Trademarks Act against the grant of Trademark to the defendant no.1 company. Photograph of the hoarding of the defendant company depicting the use of mark "ORIƎNTO" is exhibited as PW-1/8 [Colly]. Further the defendants are deliberately using

green, black and white combination which is used by the plaintiff company thereby causing confusion in the mind of the prospective buyers which can be evident from the photograph of the reverse side of defendant's tiles exhibited as Ex. PW-1/9 and the sample brochures of the plaintiff company exhibited as Ex PW 1/10 [Colly]. It was for the first time in 2009 the plaintiff observed the defendants are trying to obtain legal sanction by obtaining trademark which by any means cannot be granted to the defendant because the defendant been guilty of infringement of registered trademark, per section 29 of the Trademarks Act 1999 and the plaintiff's having filed objections to the same before registry of trademarks. The plaintiff also served a legal notice dated 16.12.2010 requiring the defendants to restrain and refrain from passing off their goods as that of the plaintiff by using deceptively similar trademark exhibited as Ex PW-1/11 and the postal receipts as Ex PW-1/12.

4. Hence, it can clearly be inferred that the defendants have infringed the registered trademark of the plaintiff by adopting a deceptively similar trademark which has been in continuous and uninterrupted use by the plaintiff company since 1977. This trademark and name, because of the widespread use and association with the quality products and services emanating from the plaintiff company, has acquired a high degree of selling power thereby becoming a target for commercial infringers intending to profit on the goodwill and reputation connected with the mark for their own benefit, by deceiving consumers as regards the source

and origin of the goods and services.

5. The trademark 'ORIENT TILES' is proved to be associated distinctively with the business and trade of the plaintiff company. The suffix by the defendant of the word 'O' after the word 'ORIENT' is certainly of no significance in as much as the word 'ORIENT is distinctive of the business and trade of the plaintiff company. There can be no manner of doubt that use by defendant is likely to cause confusion and the same has propensity of diverting customers and business of the plaintiff to the defendant. It is well settled that honesty and fair play are required to be the basic policies in business and trading and no person has right to carry on his business in such a way as would lead the public into believing that the goods or services belonging to someone else are his or associated therewith.

6. It has been held in Kaviraj Pandit Durga Dutt Sharma vs. Navaratna Pharmaceutical Laboratories [AIR 1965 SC 980] "when once the use by the defendant of the mark which is claimed to infringe the plaintiffs mark is shown to be "in the course of trade, the question whether there has been an infringement is to be decided by comparison of the two marks. Where the two marks are identical no further questions arise; for then the infringement is made out. When the two marks are not identical, the, plaintiff would have to establish that the mark used by the defendant so nearly resembles the plaintiffs registered trade mark as is likely to deceive or cause confusion and in relation to goods in respect

of which it is registered (Vide s. 21). A point has sometimes been raised as to whether the words "or cause confusion" introduce any element which is not already covered by the words "likely to deceive" and it has sometimes been answered by saying that it is merely an extension of the earlier test and does not add very materially to the concept indicated by the earlier words "likely to deceive". But this apart, as the question arises in an action for infringement the onus would be on the plaintiff to establish that the trade mark used by the defendant in the course of trade in the goods in respect of which his mark is registered, is deceptively similar. This has necessarily to be ascertained by a comparison of the two marks-the degree of resemblance which is necessary to exist to cause deception not being capable of definition by laying down objective standards. The person who would be deceived are, of course, the purchasers of the goods and it is the likelihood of their being deceived that is the subject of consideration. The resemblance may be phonetic, visual or in the basic idea represented by the plaintiffs mark. The purpose of the comparison is for determining whether the essential features of the plaintiff's trade mark are to be found in that used by the defendant. The identification of the essential features of the mark is in essence a question of fact and depends on the judgment of the Court based on the evidence led before it as regards the usage of the trade. It should, however, be borne in mind that the object of the enquiry in ultimate analysis is whether the mark

used by the defendant as a whole is deceptively similar to that of the registered mark of the plaintiff."

7. Therefore in view of aforesaid circumstances, a decree of permanent injunction is passed in terms of the plaintiff restraining the defendants, their directors, agents, assignees, distributors, servants or any other persons claiming under or through them from in any manner dealing with, manufacturing, exporting, selling, offering for sale, exhibiting, advertising, directly or indirectly dealing with tiles or cognate/allied goods under the trade mark of the plaintiff company "ORIENT" or any other identical/deceptively similar mark of the plaintiffs mark/trade name/corporate name "ORIENT" including deceptively similar name "ORIƎNTO" amounting to passing off the defendant's goods as and those of the Plaintiffs; or from doing any other thing as is likely to lead confusion/and or deception thereby resulting in passing off defendant's goods as those of the plaintiff;

8. Further a decree of permanent injunction is also passed restraining the Defendants, their directors, agents, assignees, distributors, servants or any other persons claiming under or through them from in any manner dealing with, manufacturing, exporting, selling, offering for sale, exhibiting, advertising, directly or indirectly dealing with deceptively similar Trade name/mark "ORIƎNTO" or any other identical or deceptively similar word to the Plaintiffs copyright in the artistic work and colour scheme titled as "ORIENT";

9. Further an order is passed for delivery up and the defendants are directed to destroy all copies of promotional and advertising material including labels, blocks, dies , strips, cartoons, stationery, literature or any other printed matter bearing the impugned mark for the purpose of destruction or/and erasure of deceptively similar Trade name/mark "ORIƎNTO".

10. Qua the damages, it has been well settled by this Court in Hero Honda Motors Ltd. vs. Shree Assuramji Scooters [2006 (66) DRJ 113] "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 a party which chooses to stay away from the court proceedings would escape the liability of damages as stated and set out by the plaintiff. It is also well settled that where a defendant deliberately stays away from the proceedings with the result that an enquiry into the accounts of the defendant for determination of damages cannot take place, the plaintiff cannot be deprived of the claim for damages as that would amount to a premium on the conduct of such defendant. The result would be that parties who appear before the court and contest the matter would be liable to damages while the parties who choose to stay away from the court after having infringed the right of the plaintiff, would go scot-free."

11. In Jockey International Inc & Anr vs. R. Chandra Mohan & Ors 211 (2014) DLT 757 the court noted as under:-

"43. I am in agreement with the aforesaid submission of learned counsel for the plaintiffs that damages in such cases must be awarded and a defendants, 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 defendants who appears in Court and submits its account books would be liable for damages, while another defendants 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."

12. In Rajendra Pawar (Supra) while awarding a sum of Rs. 20 lakhs as damages against the defendants the Court has held as under:-

"The Defendants have not only infringed the copyright and trademark of the plaintiff but have tried to pass off their products as that of the plaintiff by riding on its goodwill and reputation. However, inasmuch as the defendants have chosen not to appear it may not be of any use to pass a decree of rendition of accounts. The Plaintiff will nevertheless be entitled to damages in the light of the judicial dicta observed in Times Incorporated (supra) and the other aforesaid cases."

13. Though the plaintiff has filed the copy of the balance sheets of the defendant company for the year ending 31st March, 2011 till 31st March, 2015 but has not proved the same. However, since the plaintiff has been able to show prima facie violation of the plaintiff's exclusive right by the defendants and since the conduct of the defendant is deplorable inasmuch as despite committing serious violation of the plaintiff's right, the defendants have chosen not to appear before this Court which indicates the tendency of the defendants to indulge in illegal activities and since the intention of the defendants was to deceive the plaintiff and obtain wrongful advantage of the Trademark and literary work of the plaintiff, hence to preserve the exclusive work and reputation / goodwill of the plaintiff and considering the balance sheet of defendant for the year ending from 31st March, 2011 till 31st March, 2015, though not proved, the Plaintiff is awarded damages to the tune of `10.00 Lac against the defendants, payable jointly and severally. The cost of the suit also awarded in favour of plaintiff and against the

defendants.

14. Decree Sheet be drawn.

15. At last, in view of the nature of disputes between the parties, Registry is directed to re-number it as a 'Commercial Suit' and while doing so retain both the numbers. Needless to state the decree sheet shall contain the new numbers.

YOGESH KHANNA, J

OCTOBER 30, 2017 VLD