Som Brothers and Co. vs Bread House and Another

V.K. Shali, J.

IA No. 3978/2010 (under Order XXXIX Rules 1 and 2 Code of Civil Procedure) and IA No. 4135/2010 (under Order XXXIX Rule 4 Code of Civil Procedure)

This order shall dispose of IA No. 3978/2010 and IA No. 4135/2010.

Briefly stated the facts of the case are that the Plaintiff is a partnership firm, (Sic) claimed by the Plaintiff that it has honestly adopted a trademark "GURU" in (Sic)ect of variety of articles for human consumption such as rice, wheat, besan, (Sic)m, suji, flour atta, all kind of pulses, cereal preparations, suji rusk, soya chunks, (Sic)a granuales, dalia, pulses, cereals, roasted grams, and cattle feed etc. and all (Sic)ds of cereal preparations i.e. biscuits, wafers, noodles, khichdi, mirch masala, (Sic)anna masala, garam masala, chocolates, sevian (cereal preparations), mineral (Sic)ter, milk, milk products, papad, widian, guru diet, salt, spices, chips, fruit drinks, (Sic)ckles, sauces, jams, and confectionary items. It is stated that the said mark is (Sic)ing used by them exclusively from the year 1988 when it was got duly registered (Sic) a trademark vide registration No. 499956 in class 30 on 26.10.1988. It has been (Sic)ated that the said trademark has been renewed from time to time and was last (Sic)enewed on 15.6.2009 for a period of ten years for which a formal certificate has (Sic)een issued to them. Thus on the basis of the aforesaid trademark, the Plaintiff has (Sic)aimed that the said trademark has over a period of time obtained certain goodwill (Sic)nd market value and the ascending sales show that it has attained certain (Sic)espectability in the market especially in Northern State.

It is alleged that Defendant No. 1 is the seller of the product of Defendant No. 2.The Defendant No. 2 is a company incorporated under the provisions of Companies Act having its registered office at M-5A, Connaught Circus, New Delhi-01. The Defendant company is also engaged in the business of manufacturing and sale of (Sic)he edible articles for human consumption including cereals products, confectionary items, noodles, milk products, sweets, tea, biscuits, wafers, chocolates and other articles of human consumption having wheat, flour, rice, besan, sugar, cereal preparations, soya and flour improvers as an essential ingredients. The Defendant No. 2 is also using various trademarks of generic words including NESTLE, NESCAFE, MAGGI, MUNCH etc. in respect of varieties of goods which are sold in the market. In the instant case, it is alleged that the product which is being manufactured and sold by the Defendant No. 2 as wafers, layers covered with choco layers under the mark NESTLE MUNCH. It is alleged that recently the Defendant No. 2 has adopted the registered trademark of the Plaintiff "GURU" in respect of this very wafer layers covered with choco layers under the mark NESTLE MUNCH bar by adopting a scheme under the brand name of NEW GURU PACK. It is alleged that the said package of the MUNCH bar is packed in such a manner where the word "New" and "Pack" are written in a comparatively much smaller font as against the word "GURU" which has been given prominence and by doing so, they have infringed the trademark of the Plaintiff. It is alleged that the Plaintiff has got prima facie good case and that the balance of convenience is also in favour of the Plaintiff and that the Plaintiff will suffer an irreparable loss in case the Defendants are not restrained from infringing the said trademark "GURU by use of the phrase "NEW GURU PACK".

The matter had come up for hearing for the first time on 26.3.2010 and n(Sic) was issued in respect of the suit as well as the interim application to the Defenda(Sic) returnable for 27.7.2010. But in the meantime by a speaking order, an ex par(Sic) a interim injunction was granted against the Defendants from using the word "G(Sic) on its products including choco layered wafers till the next date of hearing.

The Plaintiff was directed to comply with the provisions of Order 39 Rul(Sic) CPC within a week. The Defendants on service, filed an application bearing IA(Sic) 4135/2010, under Order 39 Rule 4 CPC for vacation of ex parte ad interim s(Sic) which was listed for the first time on 05.4.2010.

In response to the advance copy having been served oil the Plaintiff, (Sic) learned Counsel for the Plaintiff appeared on 05.4.2010 and accepted notice (Sic) sought two days'' time to file the reply. Reply was filed and arguments were hea(Sic) on 7.4.2010, 12.4.2010 and 13.4.2010 in the matter.

The main contention of the Learned Senior Counsel for the Defendant (Sic) Sudhir Chandra for vacation of stay were threefold, which were as under:

(a) The first contention was that the Plaintiff is guilty of a very sha(Sic) practice which has not been approved of by the Court and therefore, th(Sic) stay deserves to be vacated on this ground itself. The practice which wa(Sic)objected to by the learned senior counsel was that although the Plainti(Sic) was having a grievance against the product being manufactured and so(Sic) essentially by Nestle India Ltd. under the brand name of MUNCH wit(Sic) the user of the word "NEW GURU PACK" but the manufacturer of the said product namely Nestle India Ltd. was not made as Defendant No. 1. On the contrary, it was alleged, that an innocuous party M/s. Brea(Sic) House was made as Defendant No. 1. It was contended that this was don(Sic) deliberately so that the learned Counsel for Defendant No. 2 who (Sic) present in Court is not available to spot that the suit is filed against thei(Sic) company and consequently, resist at the threshold itself the grant of any an ex parte ad interim stay.

The Learned Senior Counsel has also referred to the judgment of this Court i(Sic) case titled Micolube India Ltd. v. Maggon Auto Centere and Anr., 2008 (36) PTC 321 (Del.) wherein this unhealthy practice particularly on the part of the Plaintiff ( to array the main Defendant as Defendant No. 2 or otherwise while naming some of the innocuous dealers or retailers as Defendant No. 1 was being indulged to by all the parties, so as to avoid the matter being noticed and then contested by the main contesting party and the stay being resisted. The observation of the learned Judge in the said judgment needs to be reproduced here:

Another factor which goes against the Plaintiff is the manner in which the parties have been arrayed. The Defendant No. 2 is the main Defendant who has the registration of the well known mark "MICO" in respect of automotive parts. However, the Plaintiff has chosen to array Maggon Auto Centre as the (Sic)ain Defendant when, according to the averments made in paragraph 17 of the (Sic)aint, it is averred that the Defendant No. 1 is only a dealer of the impugned (Sic)oods of the Defendant No. 2 and that the exact relationship between them is not known to the Plaintiff and that the Defendant No. 2 is called upon to disclose the exact relationship between them. It is unfortunate that the main Defendant (Motor Industries Co. Ltd.) has been arrayed as Defendant No. 2 and Maggon Auto Centre, who is alleged to be a dealer of the main Defendant and whose exact relationship is unknown to the Plaintiff is arrayed as Defendant No. 1. It is not only in this case, but in several other cases that this Court has noticed this unhealthy trend on the part of the Plaintiffs to array the main Defendant as Defendant No. 2 or Defendant No. 3 while naming some innocuous dealer or retail outlet as Defendant No. 1. The object is easily discernible. When the counsel for the main Defendants scan the list of cases, they would not be able to know as to whether any case has been filed against them so as to enable them to appear on the very first date on which the case is listed before court. The very fact that the Plaintiff has also indulged in this practice is also an indicator that it did not want the counsel for the Defendant No. 2 to appear on the first date on which the matter was taken up for consideration of the grant or non-grant of ad interim injunction. This fact also dis-entitles the Plaintiff to any equitable relief. I am of the view that the Plaintiff has concealed and suppressed material facts from this Court.

The learned Counsel for the Plaintiff tried to justify the naming of Nestle as dependant No. 2 by urging that since the offending product was purchased from M/s. House, therefore, it was made as Defendant No. 1. It was contended by the learned Counsel for the Plaintiff that there was no specific reason to try to attach too much importance to the contention of the counsel for Defendant No. 2 by making it Defendant No. 2. Even otherwise, it was also contended by the learned Counsel for the Defendant that this kind of practice where the innocuous party was being made as Defendant No. 1 was started by the learned Counsel for Defendant No. 2 himself and the same has been adopted by the other counsel practicing in the field of trademark in equal measure and therefore, the learned Counsel for the Defendant could not raise any objection with regard to a practice which was started by them only.

I have considered the submissions of the respective sides. At the outset, the contention of the learned Counsel for the Plaintiff that this unhealthy practice, even though may have been started by a particular counsel, who may or may not be the Defendant''s counsel in the instant case but that can hardly be a ground for justifying the practice being adopted by the Plaintiff in a given case. The grant of injunction is an equitable relief by the Court and therefore, one of the principles which the Court has consistently been observing while granting such a relief is that the party must come to Court with clean hands. It is this feeling which was reflected in ample measure in the judgment of the learned Single Judge in the above-noted case w(Sic) it was observed that of late unhealthy practice on the part of the Plaintiffs has (Sic) started by making the main contesting Defendant as Defendant Nos. 2 and 3 ra(Sic) than Defendant No. 1 so that the name of the main contesting Defendant does (Sic) get detected and the party does not come on the first date itself so as to contest (Sic) grant of any ex parte stay.

In the case which has been cited by the learned Senior Counsel for (Sic) Defendant, this was one of the grounds on which it was held that the Plaintiff(Sic) disentitled to the equitable relief because it was taken that the Plaintiff h(Sic) concealed the material fact from the Court.

There is no denying the fact that as on date, the Courts have to deal wi(Sic) cases where the question of grant of ex parte stay are involved day in and day ou(Sic). This is more true in cases of trademarks where the matter is admittedly conteste(Sic) after the Defendant puts in appearance. Therefore, this unhealthy practice (Sic) making the main contesting party as the Defendant No. 2 or otherwise with a vie(Sic) to avoid the detection by the main contesting party has to be not only deprecated but visited with some sanction which obviously can be in a manner, no other than by refusing the grant of interim relief to the party coming to the Court. It is also the common knowledge that the ex parte injunction as per Order 39 Rules 1 and 2 CPC must be decided within 30 days from the date of grant as per terms of Order 39 Rule 1 CPC but on account of huge pendency of cases, the Courts are not able to decide the injunction application within the time frame which is stipulated by the legislature and consequently by default, the ex parte ad interim injunction order which is obtained by the Plaintiff in such cases is prolonged to the detriment of the main contesting party even though it has learnt about the same. As the Plaintiff has admittedly made Defendant No. 1, an innocuous party, knowing fully well that and Defendant No. 1 has no role except the fact that he is the retailer but it is actually the product which is purportedly manufactured by the Defendant No. 2 who is the main contesting party has indulged in sharp practice and therefore, this conduct disentitles it to any equitable relief of an injunction. Since this has not been done, therefore, on this short ground itself, the ex parte ad interim injunction against the Plaintiff deserves to be vacated because the Plaintiff has not come to the Court with clean hands.

The second contention, which has been raised by the Learned Senior Counsel for the Defendant is that the Plaintiff has been responsible for concealment of material facts and making wrong averments in para 17 of the plaint. The Plaintiff in para 17 of the plaint has observed as under:

The Plaintiffs respectfully submit that the use of the mark GURU on the part of the Defendant, in any manner whatsoever constitutes acts of infringement of Plaintiffs registered trademark No. 499956 in Class 30 as well as passing off. The Defendant has no right, interest, title or justification to adopt (Sic)nd/or use the Plaintiffs trademark GURU either as a trademark or aver to (Sic) describe the character of the packaging thereof. The use of the Plaintiff''s trade (Sic) mark GURU on the part of Defendant is not bona fide

The contention which was raised by the learned senior counsel for the (Sic)endant was that the pleadings which have been made by the Plaintiff are that a (Sic)son who has got the trademark registered has no absolute right to use the said (Sic)demark absolutely because the said right which is conferred by Section 28 of the (Sic) is subject to other provisions of the Trade Marks Act, 1999.

The Learned Counsel has referred to Section 28 of the Trade Mark Act, 1999, (Sic)hich reads as under:

Rights conferred by registration. --(1) Subject to the other provisions (Sic)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.

The Learned Senior Counsel for the Defendant has next referred to Section 30 of the Trade Marks Act and contended that the case of the Defendant is covered by Section 30(2)(a) of the Act, which reads as under:

Limits on effect of registered trademark.-

(1) ...

(2) A registered trade mark is not infringed where-

(a) The use in relation to goods or services indicates the kind, quality, quantity, intended purpose, value, geographical origin, the time of production of goods or of rendering of services or other characteristics of goods or services;

(b) ...

(c) ...

(d) ...

(e) ...

(3) ...

(4) ...

It was urged by the Learned Senior Counsel for the Defendant that a peru(Sic) of the aforesaid two provisions would clearly show that although a party may b(Sic) registered owner of the trade mark but the said mark will not be said to be infring(Sic) where use of such a trademark is in respect of defining or indicating the kind, quail(Sic) or quantity of the goods or services.

It was contended that the use of the word GURU by the Defendant No(Sic) was primarily to define the quantity of the MUNCH wafers which was being s(Sic) by the Defendant. The Learned Counsel has contended that this can be seen wi(Sic) reference to the background in which the said package has been adopted by th(Sic) Defendant inasmuch as they are selling the MUNCH in three packs i.e. CHOT(Sic) measuring 6.1 gms, MAHA measuring 16 gms and NEW GURU PACK measurin(Sic) 30 gms which are priced at Rs. 2/-, Rs. 5/- and Rs. 10/- respectively. Since the use of the word GURU which has been defined in Bhargava''s dictionary as is ''Heavy Large, eminent, respectable, esteemed, etc., therefore, it is being used as an adjective to disclose or convey the quantity equal to or more than MAHA which (Sic) being sold by the Defendant.

As against this, the Plaintiff in para 17 of the plaint has given an impression as if a registered trademark owner has the absolute right to use the said trademark and the Defendant has no right or interest or justification in using the said trademark which is totally misstatement of fact or rather concealment of material fact from this Court and if disclosed, the ex parte ad interim stay would not have been granted to the Plaintiff.

The Learned Counsel for the Plaintiff has contested this claim of the Learned Senior Counsel for the Defendant that there has been any concealment of material fact in para 17 of the plaint. It was contended that the use of the word GURU according to the documents relied upon by the Defendant themselves along with their application seeking vacation of stay indicates that the word "Nestle" has been omitted in their advertisement which was being depicted on the television.

The Learned Counsel has drawn the attention of this Court to various documents where the word "Nestle" has not been written to this visual of those print outs shown in Court during the course of hearing which depicted that the word "Nestle" was used in the beginning or at the end of the entire advertisement and therefore, the print out which has been referred to by the Learned Counsel for the Plaintiff is being torn out of context and tried to be taken advantage of.

I do not agree with the contention of the Learned Counsel for the Plaintiff that there is no misrepresentation of facts. The Learned Counsel for the Plaintiff has (Sic)nded that word GURU, in common parlance means "Teacher" or a "preacher" (Sic)respectable person and therefore, by using the word GURU it cannot be said (Sic) the said word depicted the quantity of the product. It was contended that the (Sic)ndant had other better options to disclose or describe the quantity of the product (Sic)sing the word "Big, excel etc." rather than using the word "Guru".

I have carefully considered this submission of the Learned Counsel. The (Sic)evant Sections have already been reproduced hereinabove.

There is no denying of the fact that the owner of a registered trademark has (Sic) absolute right to use the trademark because the said right u/s 28 itself (Sic)as been made subject to various provisions of the Act itself. So far as Section 30 (Sic) (a) of the Act is concerned, that is by way of one of the exceptions where the user (Sic) a mark which may be the registered trademark will not be deemed to have been (Sic)fringed if it is being used in a manner to describe the quantity, quality, (Sic)aracteristic of the services of the goods by a person who is using the said alleged offending mark. Therefore, the question which arises for consideration is whether (Sic)t can be said that the use of the word GURU by the Defendant is being used for the purpose of defining the quantity of the wafers, layered with choco layer Munch bar which is being sold and manufactured by them. For this purpose, one will have to see the definition of the word "Guru" in Hindi language. Bhargava''s dictionary in Hindi is a reputed one and can be referred with great deal of authenticity.

A perusal of the definition of the word GURU shows that it is used as both adjective as well as noun. It can certainly be termed to be as large or big definition if it is used as an adjective and if it is used as a noun then certainly it refers to as a "teacher" or someone who preaches.

In the light of the present facts, the contention of the Learned Senior Counsel for the Defendant to this that the use of the word "GURU" is in the form of an adjective defining the quantity of their Munch pack while as the same is sought to be refuted by the Learned Counsel for the Plaintiff by referring it to be as noun. Therefore, meaning that in an ordinary parlance, it will be referred to as a "teacher".

I feel that there is a merit in the contention of the Learned Senior Counsel for the Defendant that the word "Guru" is used in the instant case more as an adjective to define the quantity of the Munch bar rather than being used as a noun. Any product which is manufactured by a party is not to be seen in isolation especially when a question of prima facie view is to be taken. The Defendant has placed on record the documentary evidence which shows that they are manufacturing the aforesaid wafers, layered with choco layer Maunch bar in three different forms, smaller one is having 6.1 gms, which is called Chotu, the second one is of 15 gms which is called Maha and the third one is 20 gms. which is called GURU and it is this last pack, which has been stated to have been started only sometime in the middle of 2009 that it has been termed as NEW GURU PACK. In this background, using the word "Guru" by the Defendant is referring to the quantity of the product. It could be said that the only conclusion which one can draw is that the word "G(Sic) is used to denominate or give the indication of the quantity of this New Guru (Sic) bar started by the Defendant.

In this regard, not only the case of the Defendant is covered by the excep(Sic) u/s 30(2)(a) of the Act but also the fact that the pleadings of the plain(Sic) in para 17 leave no manner of doubt that the same are not happily drawn giv(Sic) impression as if a person who has the registration of a trademark has the absol(Sic) right to detriment or to prevent the use of the said mark by any other person. (Sic) this score also, the ex parte ad interim injunction granted against the Defenda(Sic) deserves to be vacated.

The next contention of the learned Counsel for the Plaintiff is that the wo(Sic) "Guru" has been used not as a descriptive but is being used as a trademark. T(Sic) learned Counsel in this regard has referred to the judgment of the Apex Court (Sic) case titled Amritdhara Pharmacy Vs. Satyadeo Gupta, .

As against this, the Learned Senior Counsel for the Defendant has referre(Sic) to the judgment of this Court in case titled Nestle India Limited v. Moo(Sic) Hospitality Pvt. Ltd. in FAO(OS) No. 255/2009 wherein the word "YO" by the Defendant who was the Appellant in the said case in respect of packing of thei(Sic) noodles "Maggi" was held to be not violative of the trademark "YO China" who had brought a suit for injunction.

The ex parte ad interim stay which was granted by the learned Single Judge in favour of "Yo China" by using the word "YO" against the "Maggi" was vacated by the Appellate Court holding that the word "YO" is a generic word and it is only describing a sign of exclamation by the Defendant who was the Appellants in the said case.

The Learned Counsel for the Plaintiff has also referred to various English judgments in order to substantiate his point.

I have considered these judgments. I must say that although in the said judgment which have been relied upon by the learned Counsel for the Plaintiff where there are some legal prepositions which are laid down but they are of no help to the Plaintiff in the instant case because the facts of the cases cited are different from the present case. The simple proposition while deciding the interim application in the instant case are whether the user of the word "Guru Pack" is infringing the trademark "GURU" of the Plaintiff in respect of edible articles of a particular class. Needless to say that this is to be decided by keeping three principles in mind that are prima facie case, balance of convenience and irreparable loss to the Plaintiff.

There is a tendency on the part of the counsels to quote as many authorities as possible where the party has obtained ex parte stay so that the disposal of the matter takes time and consequently the ex parte ad interim order is perpetuated at least for some time so that the opposite party against whom the stay is granted,(Sic) the heat and tries to resolve the matter by negotiations. This cannot be (Sic)tted to be done. It is in this background that this Court feels that there is no (Sic)sity of referring to the English case law when two cases decided by our Courts (Sic)ood enough to take care.

In the instant case, for the two paramount reasons which dissuade the Court (Sic) continuation of an ex parte ad interim stay order have been dealt with in the (Sic)nning itself are the facts that the Plaintiff must approach the Court with clean (Sic)ds and secondly that the Plaintiff should not make this tantamount of the facts (Sic) makirg a misstatement of law in the averments by observing that once a (Sic)emark is registered in favour of a parte, the Defendant has no right, title or (Sic)erest to use the said trade mark when admittedly there is a provision of Section (2)(a) CPC that the said trade mark can be used and it will not be deemed to be (Sic)inged if it is describing the kind, quality or quantity of the goods or services (Sic)ality, quantity.

For the reasons mentioned above, I feel that without going into the matter (Sic)ther regard to the prima facie case or the balance of convenience or (Sic)epraable loss on the aforesaid two grounds itself, I am not inclined to continue (Sic)th the ex parte ad interim stay in favour of the Plaintiff and accordingly, the same (Sic)acated.

Expression of any opinion hereinbefore shall not be deemed to be an (Sic)pression on the merits of the case so as to restrain the Plaintiff from proving its (Sic)e during the course of trial.

CS (OS) 562/2010

Post the matter before the Joint Registrar on 27.7.2010 for completion of pleadings and admission/denial.

List before Court on 13.9.2010 for framing of issues.

Parties to complete their pleadings with regard to the main suit before the next date of hearing