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Judgment
Z.S. Negi, J
The appeal, bearing C.M. (M) No. 742 of 2000 on the file of the High Court of Delhi, is directed against the order dated 14.7.2000 passed by the
Assistant Registrar of Trade Marks, New Delhi refusing application No. 472160 of the appellant No. 1 for registration and allowing the opposition No.
DEL-8736 filed by the respondent No. 1. Upon transfer of the aforesaid appeal by the High Court of Delhi to the Intellectual Property Appellate
Board in pursuance of the provisions of Section 100 of the Trade Marks Act, 1999, this Appellate Board has renumbered the same as
TA/172/2003/TM/DEL.
The appellants, a corporation and a company, respectively, organised and existing under the laws of the State of Delaware of United States of
America, are engaged in the banking and financial services all over the world. On 12.5.1987, the appellant No. 1 filed two application Nos. 472160 and
472163 for registration of trade mark PLUS SYSTEM and PLUS SYSTEM device (proposed to be used), respectively, both in class 16 in respect of
paper and paper articles, cardboard and cardboard articles, printed matter, newspapers and periodicals, books, book-binding material, photographs,
stationery, adhesive materials (stationery), artists' materials, paint brushes, typewriters and office requisites (other than furniture), instructional and
teaching material (other than apparatus), playing cards, printers' type and clinches (stereotype). On 23.5.1988, the appellant No. 1 assigned all its
rights, title and interest in and to the marks, registered or pending for registration, world over along with goodwill to the appellant No. 2. The Assistant
Registrar of Trade Marks by his order dated 19.8.1998 allowed the application No. 472163 to proceed to registration because the opposition to
registration filed by M/s. Godfrey Phillips India Ltd. was withdrawn by the opponent. By the aforesaid assignment dated 23.5.1988, the appellant No.
2, before the date of passing of the impugned order dated 14.7.2000, has become the beneficial owner of trade mark PLUS SYSTEM device under
No. 472163. The other application No. 472160 was advertised before acceptance in the Trade Marks Journal No. 1074 dated 1.3.1994 at page 1433.
The respondent No. 1 opposed the application for registration by notice of opposition No. DEL-8734 dated 2.6.1994 on the grounds that it carries on
an established business of manufacturing and marketing of computers systems capable of use as office appliances and articles, other than furniture,
technical publishing and drafting software; and providing out put on magnetic media and special stationery all being goods included in class 16; that it is
the lawful owner of trade mark PLUS which is being extensively used by it in respect of the aforementioned goods since the year 1987; that the
trademark applied for is identical to the trade mark of respondent No. 1; that the appellant No. 1 has no justification for adoption of the mark as the
same is not adopted to distinguish the goods of the appellant No. 1 and that the mark has not been used and the goods of the appellant No. 1 are not
available in India. The appellant No. 1 in the counter-statement has submitted that it has honestly and bonafidely adopted the mark for use in respect
of goods specified in the application for registration without knowledge of existence of any identical or similar mark in respect of goods specified in its
application; that the appellant No. 1 had obtained registration of trade mark PLUS SYSTEM in atleast 44 countries of the world much prior to 1987;
that the goods in respect of which registration of mark is applied for are not at all similar to goods of the respondent No. 1 and that it is denied that the
respondent No. 1 is the proprietor of PLUS SYSTEM trademark and the respondent No. 1 is confused as to whether it is the proprietor of the
trademark GALAXT.
Shri Subhodh Goel, the Managing Director of the respondent No. 1 filed affidavit dated 22.7.1995 in support of the opposition and the appellant No.
1 on 15.9.1997 wrote to the respondent No. 2 that it did not wish to file any evidence in support of its application but would rely on the facts stated in
the counter-statement. The matter was set down for hearing and ultimately on 13.1.2000 the respondent No. 2 heard the matter wherein counsel for
the appellant No. 1 appeared but none appeared for the respondent No. 1. The respondent No. 2 on 14.7.2000 passed the impugned order refusing the
application for registration. Aggrieved by the said impugned order, the appellants have preferred the present appeal to set aside the impugned order
dated 14.7.2000 and to allow the application No. 472160 on various grounds, inter alia, that the respondent No. 2 misdirected himself in the
interpretation and application of the rules of evidence in considering the affidavit of Shri Subhodh Goel and the photocopies of invoices as sufficient
evidence to establish use of the mark by the respondent No. 1 and merely on the basis of non-rebuttal of user claimed since 1987 by the respondent
No. 1 he came to the wrong conclusion that the subsequent use of similar trademark in respect of similar goods by the appellants would create
confusion amongst the consumers and, therefore, the application is hit by Section 11(a) of the Trade and Merchandise Marks Act, 1958; (hereinafter
referred to as the Act) and that the finding of respondent No. 2 that since the appellants have not rebutted the evidence, hence the claim of
respondent No. 1 on the similar trademark stand established is grossly erroneous and such a finding is perverse and clearly against the facts on record
and law; that the appellants have bitterly failed to establish their claim to be the proprietor of the trademark applied for is perverse and without any
basis and that the respondent No. 2 ought to have held that the respondent No. 1 failed to establish use of its trade mark PLUS and moreover, the
appellants' trademark PLUS SYSTEM was visually and phonetically different entitling the appellants to get the trademark registered.
It is transpired from the records that notices issued to the respondent No. 1 could not be served on it and as such the respondent No. 1 did not file
counter-statement to the appeal. The appeal was listed for hearing on 6th August, 24th and 25th October, 2007 but the hearing notices addressed to
the respondent No. 1 were received back undelivered with the postal remarks 'Left without Address'. The appellants filed M.P. No. 126/2007 for an
order from this Appellate Board to the appellants to serve hearing notice on the respondent No. 1 through substituted mode of service. It was brought
to the notice of the Appellate Board that the respondent No. 1 did not attend the hearing before the Assistant Registrar of Trade Marks, and before
the transfer of the present appeal, the High Court of Delhi had also permitted the appellants to take steps for substituted service through newspaper
publication and thus the appellants effected service by publishing the notice in 'The Statesman. The Appellate Board allowed the M. P. No. 126/2007
and the appellants have published the notice of hearing in 'The Statesman' dated 22.12.2007 and 'Punjab Kesari' (Hindi) dated 22.12. 2007. The appeal
came up for hearing on 8.1.2007 wherein Shri Sanjay Jain, Senior Advocate assisted by Shri C.A. Brijesh and Ms. V. Mohini, Advocates appeared for
the appellants and none appeared for the respondents. Since notice for hearing has been published in two newspapers (English and Hindi), the notice
of hearing is deemed to have been served on the respondent No. 1.
Shri Sanjay Jain, learned senior counsel for the appellants, relying upon the order passed in Hindustan Lever Limited v. Pfizer Ltd. and Anr. 2006
(33) PTC 205 (IPAB) contended that the opposition ought to have been dismissed for want of prosecution and the application ordered to be proceeded
to registration in pursuance of provisions of Rule 56 of the Trade Marks Rules, 2002 (hereinafter referred to as the Rules) because of the fact that the
notice of date of hearing was directly served upon the respondent No. 1 and the respondent No. 1 neither attended the hearing nor notified its intention
to attend the hearing in Form TM-7. He submitted that it is evident from the records that the respondent No. 1 has no bonafide intention to use the
mark on the basis of which it has opposed the application for registration. By drawing our attention to a copy of letter dated 30.8.1999 addressed to
respondent No. 2 and a copy thereof endorsed to the attorneys of the appellant No. 1 (marked as Annexure-'M' to the appeal) the learned Counsel
submitted that after filing the opposition, the respondent No. 1 was not contacting its attorneys even after repeated reminders and the attorneys had to
withdraw their Power of Attorney. The respondent No. 1 did not notify its intention to attend the hearing before the respondent No. 2 and also did not
attend the hearing. As per TMR Application Status search report, the respondent No. 1 has abandoned its application No. 630406 for registration of
mark PLUS. The above mentioned conducts of respondent No. 1 lead to inference that it has no bonafide intention use the mark. Shri Jain further
contended that the appellant No. 1 was first to adopt the mark and to propose to use in respect of the goods specified in the application for registration
of trade mark PLUS SYSTEM but the respondent No. 1's adoption and alleged use of its trade mark PLUS is subsequent to the appellants. Relying
upon the decision in Milment Oftho Industries and Ors. v. Allergan Inc. 2004 (28) PTC 585 (SC), the learned Counsel submitted that appellant No. 1
was first in the market. He pointed out that the first copy of invoice filed in evidence by the respondent No. 1 is of 22nd April, 1988 and as such the
adoption and use of the trade mark by the respondent No. 1 is 22.4.1988 and not since the year 1987 as claimed by it whereas the adoption of trade
mark and date of application of the appellant is 12.5.1987. It was asserted that at the time of making application for registration by the appellant No. 1,
it was the registered proprietor of the trade mark in atleast 44 countries of the world, and the trade mark application No. 472163 made in India was
allowed to proceed to registration by the very same respondent No. 2 much prior to the passing of the impugned order by him. The learned Counsel
placing reliance up on the decision in Mohan Goldwater Breweries (Private) Limited v. Khoday Distilleries Private Limited and Anr. 1977 (2) IPLR
83 further submitted that for the purpose of registration of a trade mark the right of the parties had to be determined as on the date of application and
not on the date of opposition and in the present case obviously the appellant No. 1 is first in adoption of the mark and making application for
registration and as such is entitled to registration. The learned Counsel submitted that the vested right of the appellants be saved under Section 34 of
the Act.
After having heard the learned Counsel and perusal of records pertaining to the case, the main issues that emerged for our decision is firstly,
whether the appellant No. 1 has acquired proprietary right on the date of application so as to enable it to file such application under Section 18 of the
Act, secondly, whether the registration and use of mark of the appellant No. 1 is likely to cause confusion or deception, thirdly, whether the opposition
ought to have been dismissed for want of prosecution by the opponent and lastly, whether the appellant is entitled to claim the benefit of Section 34 of
the Act. Section 18 of the Act which deals with application for registration provides that any person claiming to be the proprietor of a trade mark used
or proposed to be used, who is desirous of registering it, shall apply in writing to the Registrar in the prescribed manner for registration of his trade
mark. The said section does not provide that actual user is necessary for acquisition of proprietary right in a trade mark and an intention to use and
register the trade mark appears to be sufficient. The question of how that intention is to be gathered has been dealt with by the High Court of
Judicature at Madras in the case of Mohan Goldwater Breweries (Private) Limited v. Khoday Distilleries Private Limited and Anr. (supra) where two
appeals were filed against the orders passed by the Assistant Registrar of Trade Marks rejecting two oppositions to two applications for registration of
a trade mark consisting of the words ""Silver King"" in respect of bear, ale and stout included in class 32, and in respect of liquors of all kinds included in
class 33, respectively, stating that the marks were proposed to be used in respect of the said goods. The appellant filed notice of opposition to the
registration of the said trade mark in relation to the goods in question setting out the main grounds that the opponents had adopted the trade mark
containing the words ""Silver King"" in respect of beer manufactured by them since June 1970, and that the said trade mark had actually been
extensively used by them since September 1970 as a result of which a great deal of reputation had accrued around it; that the applicant's trade mark
was deceptively similar to the trade mark adopted and used by the opponents and therefore, the registration of the applicant's mark with the words
Silver King"" would be contrary to Section 11(a) of the Act and that the applicants were not the proprietors of the mark, in respect of the goods for
which registration had been sought, within the meaning of Section 18(1) of the Act. The applicants filed a counter statement in both the applications
stating that the applicant adopted the mark in the year 1969 believing in good faith that they were the originators of the said mark in respect of liquors
of all kinds, that only after satisfying themselves on the basis of search report from the Trade Marks Registry stating that the mark was available, the
applications were made on 10th November, 1969 for registration of the mark as their distinctive marks, that after the Trade Marks Registry accepted
the mark they had made preliminary preparations at considerable cost, that the adoption of the trade mark by the opponents after 10 months of their
adoption will not enable them to acquire ownership of the trade mark and that therefore, the opponent's adoption of the trade mark even if true was
not sustainable in law. One of the contention raised was that the applicant had not acquired any proprietary right in the trade mark in question either on
the date of the application or at any subsequent date and, therefore, they were not entitled to have the trade mark registered. The Court made the
observation at pages 89-90 as under:
The only circumstance relied on by the opponents as indicating that the applicants had no immediate intention to use the trade marks is that even after
the application for registration of the trade mark they had not chosen to actually use the trade mark. I am, however, of the view that this circumstance
will not disprove any intention on the part of the applicants to use the trade mark. The application for registration of the trade mark having been filed, it
might be that they waited till the trade mark is actually registered. It is true that even after the trade mark had been registered, the applicants have not
used the trade mark. But the opponents having filed these appeals challenging the decision of the Registrar, the applicants might have postponed the
user till the appeals are disposed of in their anxiety not to take any risk. This conduct of the applicants in not using the trade mark since the date of the
application will only indicate that they are not inclined to take the risk pending the decision of the Registrar of Trade Marks especially when the
registration of the trade marks has been opposed by the appellants on the ground that they have already adopted and used trade mark in connection
with the liquor manufactured by them."" The Court further observed at pages 90-91 as under:
It is true, the burden of proving that the trade mark in respect of which registration is sought is entitled to go on the register is on the applicant and if
there be any doubt in the matter the application will have to be refused. It is also well established that it is incumbent on the applicant to establish that
he is the proprietor of the mark before his mark could be registered. In this case the applicants are persons who have proposed to use the expression
Silver King"" as a trade mark and sought for registration of the same. On the date of the application for registration of that mark no one else had
designed and proposed to use the same. Of course they have not chosen to use the trade mark either before or after the application for registration
was filed. But as already stated, user is not necessary for filing an application having regard to the language of Section 18. If a bonafide intention to
use the trade mark immediately in connection with the goods manufactured is established, that will enable the applicant to maintain an application for
registration under Section 18. I am not prepared to accept the contention of the appellants that non-preparation came up for hearing will show that the
applicants have really no intention to use the trade mark. The applicants had sufficient interest in the mark so as to enable them to file an application
under Section 18 as on 10th November, 1969, when no one had used or proposed to use the trade mark in question.
The court further observed at page 92 as under:
The question then is, as between the applicants who had proposed to use the mark and have sought registration of the same in November, 1969 and
the appellants who have chosen, to use the mark subsequent to the date of such application for registration, who has got a preferential right to use or
the proprietary interest in the trade mark. This question leads us to the fourth contention as to what is the relevant date for ascertaining the proprietary
interest in a trade mark for purpose of registration. According to the applicants, the date of application for registration is the relevant date while
according to the opponents the relevant date is the date of opposition. On a due consideration of the matter, I am of the view that for the purpose of
registration of a trade mark the rights of the parties have to be usually determined as on the date of the application. This is the view taken by Romer J.
in Jellinek's application (1946) 63 R.P.C. 59 at p. 78. Ciba Ltd. v. M. Ramalingam A.I.R. 1958 Bombay 58 at p. 61 takes the same view. As already
stated, user is not absolutely necessary for the purpose of maintaining an application for registration. In this case the application for registration was
filed on 10-11-1969 and the evidence of user filed by the opponents is from October, 1970. Since the applicant's entitlement to registration of a trade
mark has to be decided with reference to the facts as on the date of the application for registration, the evidence of user by the opponents subsequent
to the said date cannot be relevant and will not entitle them to put forward the plea and user in answer to the earlier application for registration. The
question then is whether the applicants are entitled to have the mark registered under Section 18(1) notwithstanding its subsequent adoption and user
by the Opponents in October 1970."" After discussing various case law, the Court at page 94 summed up as ""Thus, on the date of the application, the
applicants were entitled to have the mark registered as they had proposed to use the trade mark and were desirous of registering the same and the
mark was not in use before.
Now on the analogy of above observation of the Court, when the appellants adopted the trade mark in India and made application on 12.5.1987 for
registration, no one else, not even the respondent No. 1 had designed and used or proposed to use the identical or similar trade mark. The copies of
invoices filed in evidence to prove user by the respondent No. 1 show that the first such invoice is of 22.4.1988. Though the respondent No. 2 has
recorded in his order that ""The Ld. Counsel for the applicants submitted that the opponents figures of sales stated by them in their affidavit dated 22nd
July, 1995 are not supported by documentary evidence. The Ld. Counsel further submitted that the verification of the aforesaid affidavit is also not
proper, hence, the affidavit should not be read in evidence"", but he has not given any finding on those submissions. The first invoice dated 22.4.1988
shows that the respondent No. 1 has sold SHYAM PC/AT and Dot Matrix Printer but without indicating the trade mark and such invoice cannot
prove user of trade mark. The invoice dated 17.5.1988 is admissible in evidence to prove user. The respondent No. 1 has not explained the reason for
non-production of user proof prior to 1988. The invoices mentioned in the List of Documents (pp. 36-39) such as at serial numbers 3, 6, 7, 8, 21 to 24,
26, etc. which do not bear any indication of trade mark either printed or written and there are invoices which indicate that goods other than the PLUS
products were sold and the sales figures of the respondent No. 1 include the sale of other than PLUS products. To illustrate, the invoice at serial
number 18 shows that goods worth Rs. 55,500 (excluding C.S.T) were sold to Devson Pvt. Ltd. wherein item 1 was PC/AT PLUS for Rs. 35,000 and
items 2 and 3 were Dot Matrix Printer for Rs. 17,000 and C.V.T. for Rs. 3,500, respectively, without indicating any trade mark. In view of this, it is
difficult to wholly accept the sales figures given by the respondent No. 1 as the sales figures of goods sold are under the trade mark PLUS. It is true
the appellants have not filed any evidence to prove user after filing application, but the respondent No. 1 having filed the notice opposing the
registration and the refusal of application for registration by the respondent No. 2 and appeal against refusal order of registration filed, the appellants
might have postponed the user till the appeal is decided in their anxiety not to take any risk. This conduct of the appellants in not using the trade mark
since the date of the application will only indicate that they are not inclined to take the risk pending the decision of the Registrar of Trade Marks
especially when the registration of the trade marks has been opposed by the respondent No. 1 on the ground that they have already adopted and used
trade mark in connection with the computers systems capable of use as office appliances and articles, other than furniture, technical publishing and
drafting software; and providing out put on magnetic media and special stationery manufactured and marketed by them. There is no doubt that the
onus of proving that the trade mark in respect of which registration is sought is entitled to be registered is on the applicant and in case of doubt in the
matter, the application will have to be refused. It is also well established that it is incumbent; on the applicant to establish that he is the proprietor of the
mark before his mark could be registered. In this case the appellants are persons who have proposed to use the trade mark PLUS SYSTEM and
sought for registration of the same. On the date of the application for registration of that mark no one else had designed and proposed to use the
identical or similar mark. Of course they have not chosen to use the trade mark either before or after the application for registration was filed, but as
already stated, user is not necessary for filing an application having regard to the language of Section 18 of the Act. If a bona fide intention to use the
trade mark immediately in connection with the goods manufactured is established, that will enable the applicant to maintain an application for
registration under Section 18 of the Act. In this case the appellants have established their entitlement for registration by showing that they were the
first to adopt the mark and to propose to use the mark in connection with the goods as set out in the application. If such subsequent adoption and user
by another is taken as a ground for rejection of an earlier application for registration, then Section 18(1) of the Act which enables a person to apply for
registration of a mark proposed to be used by him will be rendered practically nugatory. The right to have a mark registered under Section 18(1) of the
Act by a person devising and proposing to use it can in all cases be defeated by an unscrupulous rival trader coming to know of the mark proposed to
be registered and using the same before the mark is actually registered and putting forward opposition to the application for registration on the ground
of his user of the mark. We are unable to accept the pleading that the appellant have no justification for adopting the mark and also to agree with the
finding of respondent No. 2 that the respondent No. 1 have already established by way of evidence affidavit dated 22.7.1995 their user and reputation
in respect of their mark PLUS. The appellants have sufficient interest in the mark so as to enable them to file an application under Section 18 as on
12th May, 1987, when no one had used or proposed to use the trade mark in question. We are of the opinion that the Respondent No. 2 has not
properly appreciated the facts and the evidence available on record and erroneously held that application for registration of the mark applied for is not
is not in accordance with the provisions of Section 18(1) of the Act and as such the holding of respondent No. 2 is unsustainable.
We have already held that appellants are prior adopter of the trade mark and they have the proprietary right to file application under Section 18 of
the Act. In view of this, the finding of the respondent No. 2 that the subsequent use of the similar trade mark PLUS SYSTEM in respect of similar
goods by the appellants is definitely to create confusion amongst the consumers, hence, its registration is prohibited by operation of Section 11(a) of
the Act is unsustainable. Since the appellants are first to adopt and apply for registration, for the simple reason that there is no earlier trade mark in
use or proposed to be used on the date of application of the appellant, we do not consider it necessary to go into the question of deceptive similarity of
the proposed trade mark of appellants to any earlier trade mark, the registration and use of which is likely to cause confusion or deception on the part
of public. Apart from this, the respondent No. 1 has abandoned its application No. 630406 for registration of the trade mark PLUS in class 16.
When an application for registration of trade mark is filed any person may oppose the application for registration. Rule 56 of the Rules provide for
the procedure of hearing and decision by the Registrar. Under Sub-rule (1) of the said rule, the Registrar shall, upon completion of evidence if any,
give notice to the parties of the first date of hearing and within fourteen days from the receipt of the first notice, any party who intends to appear shall
so notify the Registrar in Form TM-7 and if any party who does not so notify within the stipulated time be treated as not desiring to be heard and the
Registrar may act accordingly in the matter. Sub-rule (4) of that rule provide that if the opponent is not present at the adjourned date of hearing and
has not notified his intention to attend the hearing in Form TM-7, the opposition may be dismissed for want of prosecution and the application may
proceed to registration subject to Section 19 of the Act. The language ""the Registrar may act accordingly"" and ""the opposition may be dismissed
employed in Sub-rule (1) and Sub-rule (4), respectively, of that rule indicate that these powers of Registrar are discretionary in nature. In the instant
appeal, the respondent No. 2 has in exercise of his discretionary powers decided to pass the order on merits. We do not see any illegality committed
by respondent No. 2 by deciding to pass the order on merits in the matter. The order passed in case Hindustan Lever Limited (supra) is distinguishable
and will be of no help to the appellants. In that case of Hindustan Lever Limited, the notice of hearing sent to the opponent was not properly
addressed-as given by the opponent-and the opponent could not appear and could not notify its intention to attend the hearing.
The appellants have averred that in para 6 of the grounds of appeal that their mark being PLUS SYSTEM is entirely different, visually and
phonetically, to the mark of the respondent No. 1 and the appellants are entitled to registration of the said trade mark. Having made this averment, the
counsel for the appellant cannot make contra argument to the said averment by claiming protection under or benefit of Section 34 of the Act.
Otherwise also, in order to fall the case within the scope of provisions of Section 34 of the Act, the mark must be identical or nearly resembling with
the registered trade mark, the user claimed should be from a date prior to the use of the registered trade mark or the date of its registration, whichever
is earlier, use should be continuous in relation to those goods or services covered by the registered trade mark and the user should be by the proprietor
or his predecessor in title. In our view, the facts of the present appeal do not come within the scope of provisions of Section 34 of the Act and as such
the contention of learned Counsel for the appellants in relation to benefit of Section 34 of the Act is rejected.
In view of the above, the appeal is allowed; the impugned order dated 14.7.2000 is set aside, and accordingly, the application No. 372160 is
allowed to proceed to registration. However, there shall be no order as to costs.