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Judgment
V. Ravi, Technical Member
Application is for removal of registered trade METRO under No. 1354281 in Class 16. The case of the applicant and the grounds for removal are
briefly as follows:-
(i) the applicant and respondent both started the business of printing visiting cards as a partnership firm on 15th January, 1979 under the name M/s.
METRO CARD AGENCY. There were later changes in the constitution of the firm but the business was carried on at the same premises.
(ii) In July, 1992 to further expand their business both the present applicant and respondent started another firm M/s. METRO CARD GALLERY at
another premises. Wide publicity in local newspapers such as ""Gujrat Samachar"" was given highlighting the expansion of ""M.G. Road is also extended
to CG Road"". Invitation Card mentioned the respondent who attended the inauguration as one of the well wishers.
(iii) The applicant submits that both he and respondent were using the trade mark 'METRO' for their business as also trading style and art work since
inception. Therefore, the respondent is not the exclusive proprietor of the mark ""METRO
(iv) The applicant submits that the respondent surreptitiously obtained registration of the impugned mark by suppressing material facts before the
Registrar. Thereafter the respondent issued a Legal Notice on 27th February, 2010 to the applicant objecting to the use of METRO trade mark to
which a suitable reply was sent. The respondent then filed a Civil Suit being No. 913 of 2010 at City Civil Court, Ahemedbad for infringement and
passing off. Thus, the applicant is an 'aggrieved person' seeking removal of the impugned mark from the register. The Hon'ble City Civil Court,
Ahemedbad rejected the Notice of Motion after hearing both parties observing that registration was obtained by suppressing material informations
from the Register amounting to fraud.
(v) The various legal grounds on which the removal of the impugned trade marks under Section 57 of the Trade Marks Act alleged are:-
(a) False averments of ownership of the mark under Section 18(1) before the Registrar.
(b) The impugned mark is remaining on the register without sufficient cause.
(c) Respondent himself has accepted joint ownership of the mark METRO.
(d) The registration of the impugned mark obtained illegally affecting the purity of the register.
(e) The respondent registered the impugned mark in bad faith with mala fide intention and conducted himself with unclean hand before the registrar.
The case of the respondent/registered proprietor is as follows:-
(i) It is an admitted position that the business was started in 1979 in the name of M/s. METRO CARD AGENCY. The respondent has been using this
business name till date. On dissolution of the said firm the respondent has been using the trade mark METRO with full knowledge of the applicant
since 1998 in the name of M/s. METRO CARD AGENCY in his sole name as proprietor and owner thereof. The applicant had also failed to file
Notice of Opposition when the impugned mark was published in the Trade Marks Journal. Filing of impugned rectification petition after such a long
time shows the mala fide conduct of the applicant. The applicant are seeking to harass the respondent after a hiatus of 13 years. This petition
therefore ought to be dismissed in limine.
(ii) The applicant has raised false and frivolous grounds of business relation with family members to establish a right over the trade mark/trade name
METRO.
(iii) The applicant have admitted that there has been changes/dissolution in the partnership firm since 1979 and is therefore an admitted position that
the trade M/s. METRO CARD AGENCY and the trade mark METRO remained with the respondent and so he was entitled as of right to the
registration and exclusive use of the trade mark METRO.
(iv) The claim of the mark METRO as joint property even now it is totally false and legally untenable. After dissolution, the firm name M/s. METRO
CARD AGENCY continued to remain in business. The said trade name came to the respondent under dissolution. The respondent therefore continues
to use the mark METRO since 1979 for his business. The applicant started M/s. METRO CARD GALLERY on 2nd July, 1992 along with the wife
of the respondent. Thus the respondent user since 1979 has been continuous and uninterrupted. The applicants have thus acquiesced the use of the
impugned mark by the respondent. In fact, the present rectification petition is a counter-blast to the Civil Suit No. 913 of 2010 filed by the respondent
against the applicant. It was only after dissolution of the firm that the respondent applied for the trade mark METRO as sole owner. The applicant
elected not to oppose respondent's trade mark application and on the principle of estoppel cannot agitate removal of the impugned mark as he has
acquiesced to the use of the METRO mark by the respondent. Filing of a civil suit against applicant does not make them 'person aggrieved'. The
applicants themselves are using the trade name M/s. METRO CARD GALLERY since 2nd July, 1992 using identical trade mark METRO. They
have not been put to any business loss. Hence, the applicant cannot be 'aggrieved person'.
(v) With regard to the Civil Suit filed by the respondent, the respondent state that he has a legal right to stop any party infringing his trade mark right
and also for passing off under common law. The observation of the Hon'ble City Civil Court was not based on merits of the case and is an interim
order. The respondent has filed an appeal in High Court of Gujarat and the applicant cannot take advantage of this order.
(vi) The respondent claims to be the exclusive owner of the trade mark METRO. Para 4 of the rectification avers that with effect from 01.09.1998
Dipakbhai Natwarlal Contractor had become sole proprietor of M/s. METRO CARD AGENCY and the retiring partner Smt. Lataben G. Seth will
not do any business with M/s. METRO CARD AGENCY. This implies the entire business including the trade mark belongs to sole owner i.e. the
respondent herein. The respondent states in the Trade Marks Act under Section 2(1)(m) the definition of a mark includes a trade name and here the
trade name includes the word METRO and hence he had a right to file for the registration of the impugned mark. Therefore, this rectification
application is an abuse of the processes of law to harass the respondent.
(vii) The respondent also submits that there has been continuous acquiescence for over 13 years by the applicant and further the applicant have not
been put to any business loss and there is no evidence to establish any confusion and/or deception in the market. Hence, the subject rectification
petition should be dismissed in limine.
The applicants have filed a reply to the counter statement of the respondent. He has denied in toto all the contentions raised on by the respondent.
The applicant submits that the partnership firm was started with three partners - (a) Shobhnaben (b) Gajendrabhai & (c) Dipakbhai (the respondent
herein). Shobhnaben retired from the partnership firm on 31st October 1979. The remaining two partners (applicants and the respondent) continued
the business and using the trade mark METRO and METRO CARD AGENCY as Joint Property. On 1st October, 1979 Gajendrabhai Sheth also
retired and on the same day his wife replaced him as a partner in METRO CARD AGENCY. Thus the business of the firm remains with the family
members of both partners. Due to huge success both partners in 1992 decided to start a sister concern METRO CARD GALLERY with the
applicant and the wife of the respondent Bharatiben Contractor for expansion of business and set up an office at C.G. Road also to develop new
markets. The respondent was present at the inauguration. He was a party to the Joint venture of the family business and the trade mark METRO was
jointly used by both parties. Even though the partners have retired, both family members were doing their business with each other. This material
position has been suppressed by the respondent. The applicant never suspected the respondent would secure registration of the trade mark METRO
behind their back and had blind faith in respondent's honesty and the registration of the impugned mark has been secured by fraud. It was only after
the respondent had issued Legal Notice on 27th February, 2010 the shell shocked applicant realized that the registration of the impugned mark has
been obtained illegally of what is a jointly owned trade mark METRO. The City Civil Court, Ahemedbad after hearing both the parties dismissed the
Notice of Motion. The respondent went to the Hon'ble Gujarat High Court. Thereafter, there was settlement talk which failed compelling the applicant
to move for rectification. The respondent has misguided the Registrar and secured the registration of impugned illegally. The user claimed by the
respondent is false. It was also decided not to use the trade name METRO CARD AGENCY and there is signature of the respondent as a witness.
In the aforesaid circumstance, the impugned mark should be removed from the Register.
The matter was listed for hearing on 5th September, 2013. We have heard the arguments of the respective counsel, gone through the pleading and
the records.
The following authority was relied on by the applicant:-
A.I.R. 1957 Madras Page 76 (B.S. Ramappa Vs. Monappa) - Head Note Where registration is obtained by suppression of a material fact, or by
making a false statement, such registration is made without sufficient cause and can be said to have been obtained by fraud. If the original registration
has been obtained by fraud, it does not confer any right under the Trade Marks Act, it follows that the renewal of registration in 1953 would also be
invalid and must be cancelled under Section 46(2).
Authority relied on by the respondent:-
2006 (32) PTC 393 Delhi (Harmohan Singh Vs. Gurbax Singh) - Paragraph I-The plaintiff and defendant are real brothers carrying on business of
manufacturing motor part, tractor parts, engine parts etc. The partnership was dissolved in 1997 and the defendant retired from the partnership
business. After retirement defendant started a firm G.P. International. Defendant started using deceptively similar mark, issued legal notice and then
filed a civil suit for infringement. Plaintiff was able to establish continuous of the trade mark. Held, plaintiff is entitled to exclusives use of the trade
mark. Suit is decreed and permanent injunction is passed restraining the defendant from using the trade mark G.P. International for automobile parts.
Gist of applicant's argument.
The respondent filed an application for registration of the trade mark METRO behind the back of the applicant in 2005. The trade mark is property of
a joint venture. Legal notice was issued by the respondent in 2010. Registration was obtained by suppression of material facts. The
respondent/applicant application for METRO trade mark without the trading style on the label is fraudulent as both parties are entitled to the trade
mark METRO. The applicants are in the same trade and hence an aggrieved person. Suit was filed by respondent with complete suppression of
material facts. The wife of the applicant and respondent operate METRO CARD AGENCY, and the proprietorship claim on the impugned mark is
false. The only evidence is sales figure of METRO CARD AGENCY by a Chartered Accountant the trade mark METRO.
Gist of respondent's arguments.
The respondent states the applicant's case briefly is (a) suppression of material facts and (b) the mark belongs to a Joint Venture firm and so
rectification of impugned mark is sought. The respondent submits after 31st March, 1998 they were rivals. There is undoubted delay. Section 24(1)(a)
and (b) concerning joint venture favours the respondent. Thus the position as was in 2005 when they applied for the impugned mark, respondent was
the sole proprietor of impugned mark. The respondent has been using the impugned mark since 1979 continuously. There is no merit in this petition and
it should be dismissed without hesitation.
Rebuttal Agreement.
Separation is not with respect to the trade mark. The respondent can not be regarded as an exclusive owner of impugned mark in law.
We think there is no better way to address the issues relating to ownership of impugned mark and allegation of wanton delay in asserting right on
the mark by the applicant without quoting the relevant portion of the Hon'ble Judge findings in suit No. 913 of 2010, City Civil Court, Ahemedbad:-
(3) On hearing the learned advocate for the parties and perusing the record, it transpires that the plaintiff is guilty of suppression of various facts. The
defendant in reply has explained the previous relations of the plaintiff with the defendant. It is the case of the defendant that in the year 1979 the
defendant had partnered with the plaintiff and were using the mark ""METRO"" and subsequently one more partnership firm was established, wherein
wife of the present plaintiff became a partner and wife of other partner, which was newly established, became partner of the plaintiff. Such business
continued up to 1998 and thereafter the parties separated. The plaintiff is unable to dispute these facts in affidavit in rejoinder. These facts, therefore,
clearly establish that the plaintiff and the defendant i.e. their respective partners as aforesaid were concurrently using (Emphasis supplied) the mark
METRO"" even before the plaintiff got the said mark registered under the Trade Marks Act. By suppressing such facts, the plaintiff has given an
impression in the pleadings i.e., in the plaint as if the defendant is unknown to him and suddenly he has started the use of mark ""METRO"". When the
defendant in affidavit in reply pointed out such facts, the plaintiff has no other option, but to admit the said facts in the affidavit in rejoinder. The
plaintiff, who is before this court under Order XXXIX of CPC which is a discretionary and equitable remedy, thus, has disentitled himself of the said
relief.
(4) That apart, the averments made by the plaintiff in the plaint are vague and general. It is not even whispered as to since what period of time the
defendant has started infringing the trade mark. Considering the aforesaid undisputed position that initially the parties were concurrently using the
trade mark and subsequently they got separated and still, within their knowledge, they continued to use the mark ""METRO"" for their respective
separate business ever since 1998, it is too late in the day for the plaintiff to seek an injunction to restrain the defendant from using the mark
METRO"". Apart from the fact that the plaintiff has acquiesced into the use of mark ""METRO"" as aforesaid with full knowledge and consent, the
plaintiffs action is delayed by as long as 12 years, even if it is presumed that after 1998 i.e. after separation of business, the defendant was not entitled
to use the mark, although no evidence is placed on record to show such disentitlement to the defendant. It is a settled law that the court would not
exercise discretionary powers under Order XXXIX of the CPC in favour of the person who, by delaying his action, has allowed his adversary to incur
expenditure in his business, including advertisement and other costs and then, wakes up on one fine day and complaints of and accuses the defendant
of infringement of trade mark. Reliance is, however, placed upon the case of Shri Swaran Singh Trading as Appliances Emporium Vs. Usha
Industries (India), New Delhi & Anr. Reported in AIR 1986 Delhi 343 (1). In the said decision, the Hon'ble Delhi High Court has laid down the
proposition that delay in seeking the relief in respect of infringement of trade mark is normally not a bar and the principles governing grant of
injunctions in other types of cases do not apply. The Hon'ble High Court, however, has observed that delay in a case of concurrent user of similar
mark might be fatal. Thus, this case cannot be cited as laying down a blanket ratio that in no case the court can consider the delay as a reason for
rejection of an interim application. In fact, the judgment is an indicator of the fact that delay in a case of concurrent user of similar mark might be
fatal, which exactly is the case before this court. Reliance is also placed upon the case of Rupa & Co. Ltd. & Anr. Vs. Dawb Mills Co., Ltd., & Anr.
Reported in AIR 1998 Gujarat 247. Therein also that Hon'ble High Court laid down the proposition that the delay by itself cannot be a ground for
refusal of discretionary relief, but it is one of the considerations. The Hon'ble High Court further added that unless there is a justification for accusing
the plaintiff of culpable delay amounting to acquiescence or abandonment of right, it cannot be disentitle him to relief of injunction. Thus, culpable
delay amounting to acquiescence or abandonment of right can certainly be a ground for rejection of interim order and thus, this judgment also does not
lay down a blanket proposition that under no circumstances delay can be the reason for rejection of interim relief. In the case of Chanel Ltd. Vs.
Sunder Chemicals Agarbati Works (P) Ltd. & Anr. Reported in 2003 (26) PTC 52 (Del.), the Hon'ble High Court in para - (v) observed as under:-
In the case of registered mark, the defence of delay, is very very limited, if at all available. In Shri Swaran Singh Trading as Appliances Emporium V.
M/s. Usha Industries (India) New Delhi and another, AIR 1986 Delhi 343 (DB) of this Court held that an exclusive right is granted by the registration
to the holder of a registered trade mark and is a statutory right which cannot be lost by delay. Defence of laches or delay can be set up on equity but it
cannot be put forth by some one who had not acted fairly and honestly and has used the trade mark of another person.
In absence of any satisfactory explanation by the appellants, the adoption of the mark by them cannot prima facie is regarded as honest and plea of
delay and laches would be of no avail to them. Moreover even if there is an inordinate delay on the part of the plaintiff in taking action against the
defendant, the relief of injunction is not to be denied. The defence of laches or inordinate delay is a defence in equity. Inordinate delay or laches may
defeat the claim of damages or rendition of accounts but the relief of injunction should not be refused. The defendant has not been able to make out
that case. The defendant has failed to show sale of impugned products in the open market. All the sale of the defendant's goods are confined to
canteens/stores of Ministry of Defence. I also agree with the further contention of plaintiffs counsel that even assuming there is delay, that can only
adversely affect the plaintiff's claim for damages but not the claim for injunction.
On the point of delay, I also find that plaintiff has been able to explain the entire period which has been consumed by the objections filed by the
plaintiff, as the appeal against the same is pending before this court, where there is an interim order operating in favour of the plaintiff to the extent of
stay of an order of the Registrar by which he had declined relief to the plaintiff. There is merit in plaintiff's contention that where adoption of the mark
is mala fide or where trademark is so deceptively similar, delay cannot be a ground to deny the relief of injunction.
Thus, it appears that the aforesaid case lays down the proposition that scope of delay with a reason for rejection of interim relief is very, very limited
and in absence of satisfactory explanation of adoption of mark by the adversary, the injunction shall have to be granted. In the instant case, in fact, it is
the defendant who has explained as to how he has been using the trade mark, rather than the plaintiff, who ought to have explained. Therefore, the
observations made by the Hon'ble Delhi High Court in the aforesaid case does not help the plaintiff particularly when the plaintiff is unable to dispute
the concurrent user (Emphasis supplied). It is noted that the plaintiff claims to be the sole proprietor of trade mark ""METRO"" and the argument
advanced by the defendant is that he has been using concurrently the same trade mark. It is not known as to whether the plaintiff disclosed such facts
before the Registrar of Trade Marks, but considering the conduct of the plaintiff in suppressing the facts and asserting that he is the sole proprietor of
the disputed trade mark, it appears that the same conduct might have been exhibited by the plaintiff before the Registrar of Trade Marks. The effect
of registration obtained by fraud has been explained by the Hon'ble Madras High Court in the case of B.S. Ramappa Vs. B. Monappa & Anr.
(Reported in AIR 1957 Madras 76). According to the Hon'ble High Court, such action whereby the mark is obtained by fraud will not have the effect
of rendering the certificate as valid and even the renewed certificate will be invalid. Thus, looking at the case from various angles aforesaid, this court
is of the opinion that the plaintiff is not entitled to interim relief. The application is, therefore, required to be rejected and the following order is passed:-
ORDER:
The Notice of motion fails and is rejected in limine.
The respondents have filed a suit for infringement of their registered trade METRO by the applicant. This gives the applicants, the required locus
to agitate the removal of the impugned trade mark. The applicants are persons aggrieved.
The crux of the matter in the instant case is whether the respondent was entitled to the ownership of the impugned mark after 1998 when the
applicants and respondent separated and the joint venture as per respondents contention was terminated. For convenience sake Section 24 dealing
with jointly owned trade mark is reproduced below:
Section 24. Jointly owned trade marks:
(1) Save as provided in Sub-section (2), nothing in this Act shall authorise the registration of two or more persons, who use a trade mark
independently, or propose so as to use it, as joint proprietors thereof.
(2) Where the relations between two or more persons interested in a trade mark are such that no one of them is entitled as between himself and the
other or others of them to use it except-
(a) On behalf of both or all of them; or
(b) in relation to an article or service with which both or all of them are connected in the course of trade, those persons may be registered as joint
proprietors of the trade mark, and this Act shall have effect in relating to any rights to the use of the trade mark vested in those persons as if those
rights had been vested in a single person.
13 The law on this point has been clearly elucidated by Shri K.C. Kailasam on the law of Trade Marks on and Geographical Indications at page 331
(Second Edition.):-
RIGHT OF THE PARTIES ON TERMINATION OF JOINT VENTURE:
By the very nature of the condition imposed under Section 24, the termination of the joint venture would imply that none of them will be entitled to use
the mark independently or to remain as joint proprietors. It has been held that when a manufacturer, shipping agent and importer have adopted a
combination indicative of the interest of each, no one of them could claim to be entitled exclusively as against the others to that design, when the
adventure is put an end to. On cessation of the joint venture, the parties will have to have independent marks to distinguish their own trade or business,
if any. The new trade marks will have to be sufficiently distinct and different from the mark used by them earlier during the existence of the joint
venture arrangement to obviate any confusion or deception in the minds of the public. The parties may bring to the notice of the Registrar the
termination of the arrangement, so as to enable him to rectify the register in respect of the registered trade mark under Section 57 of the Act.
The respondent had applied for exclusive right for the trade mark METRO previously jointly used by both parties. That is clearly a
misappropriation of property not recognized by trade marks law. Hence, the impugned mark has to go. In the result, ORA/81/2011/TM/AMD is
allowed and registered trade mark METRO under No. 1354281 in class 16 is removed from the register of trade marks. Parties are left to bear their
own costs.