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Friday, March 4, 2011

trade mark and copy rights act eenadu case


                                                            REPORTABLE


                IN THE SUPREME COURT OF INDIA



                   CIVIL APPELLATE JURISDICTION



                CIVIL APPEAL NOS.6314-15 OF 2001




T.V. Venugopal                  `                         ... Appellant



            Versus



Ushodaya Enterprises Ltd. & Another                       ... Respondents




                             J U D G M E N T


Dalveer Bhandari, J.



1.    These   appeals   are   directed   against   the   judgment



delivered by a Division Bench of High Court of Andhra Pradesh



in Letter Patent Appeal Nos. 12 and 13 of 2001 on 15.06.2001.




2.    Brief   facts   which   have   been   given   by   the   appellant   are



recapitulated as under.




3.    The appellant is the sole proprietor of a firm carrying on



business inter alia as manufacturers of and dealers in incense


                                                                           2



sticks   (agarbathis)   in   the   name   and   style   of   Ashika   Incense



Incorporated at Bangalore.




4.    The appellant started his business in the year 1988 and



adopted   the   mark   `Ashika's   Eenadu'.     According   to   the



appellant the word `Eenadu' in Kannada language means `this



land'.   In Malayalam and Tamil language it conveys the same



meaning.  In Telugu language it means `today'.




5.    In   consonance   with   the   above   meaning   the   appellant



devised   an   artistic   label   comprising   a   rectangular   carton   in



bottle   green   background   with   sky-blue   border   and   in   the



centre, in an oval  tricolour, the word `Eenadu' is written.




6.    According to the appellant, in the year 1993 he honestly



and bona fidely adopted the trade mark `Eenadu' meaning `this



land' in Kannada.  In the said label the other expressions used



are `Ashika's original' and the firm's logo printed in red against



yellow background.  The other panel of the carton contains the



same   description   in   Telugu  besides  the   name   and   address   of



the  appellant.     The  panel  on  one   side  of  the   carton  mentions


                                                                           3



the   name,   address,   contents   and   another   side   contains



`Eenadu' in Devnagari, Tamil and Malayalam.



7.    The appellant applied for registration of trade mark on or



about   10.02.1994   of   the   said   label   bearing   application   No.



619177.  The appellant made an application to the Registrar of



the Trade Marks for a certificate under proviso to Section 45(1)



of the Copyright Act, 1957.   The Registrar issued a certificate



on   7.3.1996.     Thereafter,   an   application   for   registration   for



copyright was made by the appellant on 14.3.1997.




8.    The   appellant's   product,   incense   sticks   (agarbathies)



were well received in the market and according to him, when



he filed the appeal before this Court, his annual business was



about rupees eleven crores per annum.




9.    The   respondent   company,   who   was   engaged   in   the



business   of   publishing   a   newspaper   in   Telugu   entitled   as



`Eenadu',   served   a   cease   and   desist   notice   on   the   appellant



which   was   replied   by   the   appellant   on   8.3.1995.     The



respondent   company   in   the   year   1999   filed   a   suit   for



infringement   of   copyrights   and   passing-off   trade   mark   in   the


                                                                            4



Court   of   Second   Additional   Chief   Judge,   City   Civil   Court,



Hyderabad.   The   respondent   company   therein   claimed   that



they   have   been   in   the   business   of   publishing   a   newspaper,



broadcasting, financing and developing a film city.




10.    It   was   contended   by   the   respondent   company   that   the



use   of   the   word   `Eenadu'   by   the   appellant   amounted   to



infringement of their copyright and passing-off in trade mark.



According   to   the   respondent   company,   the   business   of   the



appellant and the respondent company was different and there



is   no   commonality   or   casual   connection   between   the   two



businesses.




11.    The   appellant   states   that   the   word   `Eenadu'   is   a   well



known   and   well   understood   word   appearing   in   all   the   South



Indian   languages.     It   means   `today'   in   Telugu.     In   Tamil,



Malayalam   and   Kannada   it   means   `this   land'.     Therefore,   no



absolute   monopoly   could   either   be   claimed   or   vest   in   any



single   proprietor   in   respect   of   the   entire   spectrum   of   goods



and/or   services   and   there   have   been   other   traders   and



manufacturers   who   have   been   using   the   word   `Eenadu'   to


                                                                            5



distinguish   their   merchandise   from   similar   merchandise   of



others.



12.    The   appellant   also   asserted   that   in   Hyderabad   one   co-



operative   bank   exists   in   the   name   of   `Eenadu   Cooperative



Bank   Ltd.'   and   their   services   are   advertised   as   `Eenadu



Deposits',   a   shop   also   exists   in   Vijayawada   by   the   name



`Eenadu  Men's  Wear'  and  a  film  titled  `Eenadu' in Malayalam



and Telugu was produced some time over a decade back.  The



appellant contended that detergent powder, playing cards, hair



oil, coffee  powder, tea powder, papad etc. are being sold with



the mark `Eenadu'.




13.    The   Second   Additional   Chief   Judge,   City   Civil   Court,



Hyderabad on 24.11.1999 had granted an ex-parte ad interim



injunction restraining the appellant from using the expression



`Eenadu'   and   the   same   was   confirmed   on   27.12.1999.



Thereafter,   the   appellant,   aggrieved  by   the   said   order,   moved



the   High   Court   of   Andhra   Pradesh   at   Hyderabad.     The   High



Court   suspended   the   interim   injunction.     The   High   Court



permitted   the   appellant   to   dispose   off   their   finished   products


                                                                              6



to   the   tune   of  Rs.1  crore   and   also  permitted   the   appellant   to



produce goods that were in the process of manufacture to the



tune of Rs. 78 lakhs.




14.    Meanwhile, the trial court on 24.7.2000 partially decreed



the   suit   of   the   respondent   company.     The   appellant   was   not



injuncted from using the words `Eenadu' in the entire country



other than in the State of Andhra Pradesh.




15.    The   appellant,   aggrieved   by   the   order   of   the   City   Civil



Judge   filed   an   appeal   before   the   High   Court   of   Andhra



Pradesh.     The   respondent   company   also   filed   an   appeal



against the order of City Civil Judge praying that the order of



injunction   to   be   made   absolute   and   not   be   confined   to   the



State of Andhra Pradesh.   The learned Single Judge disposed



of   both   the   appeals   by   a   common   judgment/order   dated



29.12.2000.  The appeal filed by the respondent company was



dismissed and the appeal filed by the appellant was allowed.




16.    Aggrieved by  the said order of the learned  Single Judge,



the   respondent   company   filed   Letters   Patent   Appeals   before


                                                                              7



the   Division   Bench   of   the   High   Court.     The   High   Court   vide



impugned order allowed its appeals, decreeing the O.S. No.555



of 1999.




17.    The  appellant  also   aggrieved   by   the   impugned  judgment



filed   appeals   and   submitted   that   the   courts   below   were   not



justified in granting relief which was not specifically prayed for



in   the   plaint.     The   appellant   further   submitted   that   the   High



Court   erred   in   holding   that   the   copyrights   of   the   respondent



company   were   infringed   in   the   absence   of   a   prayer   for



infringement   of   copyrights.       According   to   the   appellant   the



Division   Bench   of   the   High   Court   erred   in   holding   that   they



were passing-off the copyrights when the Copyright Act, 1957



does not provide for such a remedy.




18.    The appellant also submitted that the courts below have



not properly appreciated the distinction between the existence



of a copyright and its infringement.




19.    According   to   the   appellants,   the   respondent   company



was aware of the appellant's business since at least 27.2.1995


                                                                                8



and   there   has   been   a   gross   delay   in   filing   of   the   suit   and



because   of   inordinate   delay   in   approaching   the   court,   the



respondent company is not entitled to any relief.




20.    The   appellant   further   submitted   that   whether   an   action



for   passing-off   could   be   maintained   and   injunction   granted



when a mark is used consisting of the word `Eenadu', which is



a common word.  The word `Eenadu'  literally means `Today' in



Telugu   and   `this   land/our   land'   in   Kannada,   Tamil   and



Malayalam.




21.    The   appellant   contended   that   the   businesses   of   the



appellant   and   the   respondent   company   are   entirely   different



and   there   is   no   question   of   passing-off   of   the   goods   of   the



appellant as that of the respondent company.




22.    The respondent company denied all the averments of the



appellant and submitted the following propositions.




       1.    The essence of an action of passing-off is an attack



             on   or   dilution   or   benefitting   from   the   goodwill   and



             reputation of another person.


                                                                         9



2.     If such goodwill or reputation arises out of the use



       of a name in respect of a particular product and the



       goodwill   and   reputation   is   restricted   only   to   such



       product   and   unknown   outside   such   product   then



       the   use   of   such   name   by   another   person   with



       respect   to   a   totally   different   product   would   not



       affect   the   goodwill   and   reputation   so   as   to



       constitute an action of passing-off




3.     If,   however,   the   goodwill   and   reputation   is



       sufficiently   wide   and   the   name   is   associated   with



       the   source   in   a   more   general   way   rather   than



       restricted   only   to   a   given   product   then   the   use   of



       such   name   by   another   trader   for   even   a   totally



       different product could amount to a passing-off.




4.     The exception to the three above propositions would



       be   if   such   name   is   a  generic   name   for   the   product



       being   manufactured   by   the   rival   trader   in   which



       case it would never constitute an action of passing-



       off.


                                                                               10



       5.    Again, if the said name is descriptive of the product



             of the rival trader, it would then amount to passing-



             off   only   if   it   is   established   that   it   has   become   a



             household   name   of   such   a   nature   as   to   have



             acquired   a   strong   secondary   meaning   and   it   being



             associated   substantially   with   the   first   trader,   in



             which case alone it would amount to a passing-off.



             The   standard   of   proof   of   such   a   case   would   be



             higher   than   the   standard   of   proof   of   first   three



             propositions.




23.    Mr.   Mukul   Rohtagi,   learned   senior   counsel   and   Mrs.



Prathiba   Singh,   learned   counsel   arguing   on   behalf   of   the



appellant   submitted   that   in   the   instant   case   the   suit   was   in



fact   governed   by   Trade   &   Merchandise   Marks   Act,   1958   and



not by the Trade Marks Act, 1999 which came into force w.e.f.



15.9.2003.     It  was   submitted   that  this   case   is   covered   under



section 159(4) of the 1999 Act, which specifically provides that



any   legal   proceedings   pending   in   any   court   at   the


                                                                          11



commencement of this Act would be governed by the old Act.



Section 159(4) of the 1999 Act is reproduced as under:-




       "159.   (4)     Subject   to   the   provisions   of   section

             100   and   notwithstanding   anything

             contained   in   any   other   provision   of   this

             Act,  any  legal  proceeding  pending  in  any

             Court   at   the   commencement   of   this   Act

             may be continued in that court as if this

             Act had not been passed."


Thus, none of the concepts of well-known marks, dilution etc.



as   statutorily   applicable   under   the   1999   Act,   have   any



application in this case. It is submitted that the present case,



as decided by all the courts below, is a case of passing off and



not of dilution.




24.    In   reply   to   the   submission   of   the   respondent   company,



learned   counsel   for   the   appellant   submitted   that   the   passing



off test  is the test of likelihood  of confusion.   Such confusion



should be either confusion arising due to get  up of products,



confusion as to sponsorship/affiliation of source or confusion



arising   out   of   the   use   of   identical/deceptively   similar



trademarks.


                                                                             12



25.    Learned   counsel   for   the   appellant   also   submitted   that



dilution   is   a   completely   different   concept,   namely,   if   there   is



confusion, there is no dilution.   The concept of dilution steps



in   when   in   fact   the   consumer   is   not   being   confused   but   the



plaintiff's   mark   is   being   diluted   in   some   form   or   the   other.



McCarthy,   a   well-known   author   on   Trademarks   and   Unfair



Competition   clearly   states   the   same   in   the   said   publication.



Reliance   is   being   placed   at   para   24.70   wherein   it   has   been



observed that "the dilution doctrine is concerned with granting



protection   to   trademarks   beyond  that  provided   by   the   classic



`likelihood of confusion' tests."




26.    According   to   the   appellant,   the   principle   of   dilution



requires that the consumer in fact should not be confused but



a   well-known   mark,   in   the   absence   of   confusion,   is   being



diluted.   In the United States of America, dilution is protected



by a specific statute called the Federal Anti Dilution Act, 1996.



The   discussion   on   dilution   in   McCarthy   establishes   the



following:-


                                                                              13



       a) The   traditional   likelihood   of   confusion   test   applies   to



             passing off.



       b) If a mark is a well-known mark, then the argument of



             dilution   is   to   be   considered   in   the   absence   of



             confusion.



       c) Dilution is a doctrine which should be strictly applied.



       d) Standard of distinctiveness required to protect a mark



             from dilution is very high.



       e) Not   every   trade   mark   can   be   protected   against



             dilution.



       f)    If   a   mark   enjoys   a   regional   reputation   it   does   not



             deserve protection under the law of dilution.



       g) A   reputation   on   a   national   scale,   especially   while



             testing the mark for unrelated goods, is required to be



             protected under dilution.




27.    Learned   counsel   for   the   appellant   submitted   that   under



the traditional law of passing off or under the law of dilution,



the   only   marks   which   have   been   protected   across   product



category   are   marks   which   can   easily   be   termed   even   in   the


                                                                             14



common parlance as well-known marks. Such marks such as



Bata, Volvo, Benz, Mahindra & Mahindra and Tata etc.




28.    It was submitted that the case pleaded by the respondent



company (plaintiff) is one of confusion and passing off and not



of   dilution.     The   standard   for   establishing   dilution   are



completely different.  There is neither a pleading in the present



case alleging dilution, nor any evidence in support of dilution.



The   standards   for   recognizing   dilution   have   not   been



confirmed by any court of law in India and while deciding the



present case in the courts below the threshold of dilution was



never applied.




29.    In India, the law on dilution has developed through case



law   going   back   to   the   Benz's   case   decided   by   the   Delhi   High



Court   in  Daimler   Benz   Aktiegesellschaft   and   another  v.


Hybo   Hindustan    AIR   1994   DELHI   239.     However,   `Eenadu'


cannot   claim   the   distinctiveness   or   the   reputation   which   is



enjoyed   by   a   mark   like   Benz   or   Harrods.   `Eenadu'   is   a   very



ordinary word commonly used in Telugu language and to vest



a monopoly in favour of the respondent company (plaintiff) for


                                                                        15



such a common word on the ground of dilution would result in



conferring  an   undue   monopoly   to  a  generic/descriptive  word.



There   are   several   marks   which   are   used   in   the   ordinary



language for different types of products, such as :-



       1.    Time/Times            Time   Magazine,   Time   Education,

                                   Times   London,   Times   of   India,

                                   Navbharat Times, Hindustan Times,

                                   Times Now

       2.    Today                 India Today, Punjab Today, Today's

                                   Tea, Today's Contraceptive

       3.    Marvel                Marvel Comics, Marvel Detergent

       4.    Sun,          Surya,  Oil, Lights & Bulbs, Tobacco

             Suraj

       5.    Metro                 Metro   Shoes,   Delhi   Metro,   Metro

                                   Walk Malls

       6.    Maruti                Oil, Cars

       7.    Taj                   Hotels (Taj Hotels), Tea (Wah! Taj)

       8.    Citi                  Citi Bank, City Mall

       9.    Mustang               Motel, Cars, Trailers




30.    The   learned   counsel   for   the   appellant   submitted   that



`Eenadu'   is   a   common   word   used   in   Telugu   language.   This   has



been fully established by the evidence on record.




31.    He  referred to  the  deposition   of Jagannadharao,  PW1,  Law



Officer of the plaintiff, who has stated that the literal meaning of



the word `Eenadu' is `Today'.


                                                                           16



32.    According   to   the   deposition   of   PW2,   N.   Swami,   Artist,   the



meaning of the word `Eenadu' is `Today'.




33.    Learned   counsel   for   the   appellant   referred   to   deposition



of   PW5,   R.   Kumaraswamy,   Advocate   who   has   stated   that



literal meaning of the word `Eenadu' is `Today'.




34.    The   learned   counsel   referred   to   the   deposition   of   PW6,



T.V. Venugopal, the appellant herein.   He has stated that the



word `Eenadu'  was specifically  given  for the purpose  of  `daily'



prayer.




35.    The learned counsel for the appellant submitted that the



word `Eenadu' literally means "Today" or "This Day" and hence



is not an invented word but is a generic/descriptive word used



in   common   parlance.     This  is   further   proved   by   the   fact  that



the word `Eenadu' has been used by several parties for various



products which include :-



       -    `Eenadu'   Turmeric   powder   -   even   the   script   is   the

            same



       -    `Eenadu' Cooperative Bank


       -    `Eenadu' Match Sticks - even the script is the same


                                                                         17



-    `Eenadu' Playing Cards


-    `Eenadu' Ayurvedic Bath Soaps


-    `Eenadu' Dresses


-    `Eenadu' Chilly Powder - even the script is the same


-    `Eenadu' Washing Powder


-    `Eenadu' Coffee - even the script is the same


-    `Eenadu'  Telugu Feature Film


-    `Eenadu' Tobacco - same script


-    `Eenadu'  Hotel


-    `Eenadu'  Marble Estate


-    `Eenadu'   Feature   Film   (The   said   film   by   UTV

     Production uses the word `Eenadu' in the same script

     as used by the respondent - (This particular film has,

     in fact, been featured for a  review in the respondent's

     own newspaper dated 15.8.09 & 27.8.09 and copies of

     the same are attached.   The music launch of this film

     was also featured in the newspaper of the respondents

     dt.   14.9.09.   This   film   has   at   least   2   songs   with   the

     word   `Eenadu'.     One   of   the   songs   in   the   film   called

     "Eenadu   Eesamaram"   which   means   "This   Day,   This

     War".


-    A famous Kannada song - Eenadu Kannada, Eeneeru

     Kannada   (This   day   is   Kannada,   This   water   is

     Kannada).


                                                                             18



36.    The appellant submitted that it is clear that `Eenadu' is a



term   which   is   used   in   the   ordinary   Telugu   language   and   in



Kannada   and   the   same   is   acknowledged   by   the   respondent



company   itself   as   is   evident   from   the   wide   publicity   given   to



the film in the respondent company's newspaper.




37.    The  appellant further submitted  that the evidence  relied



upon   by   the   respondent   company   in   order   to   allege   that



`Eenadu' is a reputed and distinctive mark, is a compilation of



documents handed over before this court during the course of



arguments   on   23.3.10.   In   order   to   show   that   `Eenadu'   is   a



household   name,   an   extract   from   Wikipedia   printed   on



13.4.09 was submitted by the respondent company before this



court.  In fact, all the other internet print-outs annexed by the



respondent   company   are   based   on   Wikipedia   itself.     It   is   the



submission   of   the   appellant   that   it   is   now   an   established



position,   internationally   in   law   that   Wikipedia   does   not   have



any evidentiary value in the court proceedings.  The same has



been held by the US Court of Federal Claims in  Taylor Mary


Campbell  v.  Secretary   of   Health   and   Human   Services  69


                                                                          19



Fed.   Cl.   775   (2006)   and   by   the   US   Court   of   Appeals   in


Lamilem Badasa v. Michael B. Mukasey    540 F.3d 909. As


against the Wikipedia evidence, the actual evidence on record



reveals the following:-



      a)    `Eenadu'   has   a   specific   meaning   in   Telugu   language


            and   also   has   a   meaning   in   Kannada   language   and



            possibly even in Malayalam;



      b) `Eenadu' has been used by several parties in the same



            script   without   any   objection   whatsoever   from   the



            respondent company (barring 2 ex-parte injunctions).



      c)    `Eenadu' means "Today" or "This Day".



      d) The   respondent   company   itself   has   acquiesced   to   3rd



            party   usage   of   the   mark   (including   `Eenadu'   feature



            film by UTV).



      e)    The respondent company's submission that this court


            ought   to   ignore   the   concrete   documentary   evidence



            and testimony and instead rely upon extracts from the



            Wikipedia to prove that `Eenadu' is a household name,



            is not liable to be entertained.


                                                                           20



38.    Thus,  `Eenadu'   does   not enjoy  the   distinctiveness  which



the   respondent   company   claim   and   in   any   event   such



distinctiveness   does  not  span   across   all   classes   of  goods  and



services.




39.    The   respondent   company   has   argued   before   this   court



that  the descriptive nature of the mark has to be determined



with   respect   to   the   appellant's   goods.     This   approach



according   to   the   appellant   is   completely   erroneous.     While



determining   the   nature   of   the   mark   -   for   the   purpose   of



registration or for the purpose of passing-off/infringement, the



first inquiry which the court ought to carry out is to determine



whether   the   applicant's/plaintiff's   mark   is   invented,



arbitrary/suggestive, descriptive or generic.  The nature of the



mark   is   always   determined   with   respect   to   the



plaintiff's/applicant's goods.   For example, if a person applies



for   a   trademark   called   "Extra   Strong",   the   Registrar   of   trade



mark   has   to   examine   whether   the   mark   is   descriptive   or



laudatory   for   the   goods   for   which   it   is   applied,   i.e.,   the



applicant's goods.  The inquiry does not depend on the person


                                                                           21



opposing   the   use   of   the   said   mark.   Thus,   to   hold   that   the



nature of the mark has to be determined by the nature of the



appellant's goods is stating the proposition in the reverse.




40.    In   the   present   case,   the   plaintiff/respondent   company



was conscious that `Eenadu' is a descriptive mark and it is for



this   reason   that   in   the   plaint,   the   plaintiff   (respondent)



company   has   pleaded   a   secondary   meaning   with   respect   to



their   mark   `Eenadu'.     If   the   plaintiff's   case   is   based   on



`Eenadu'   being   a   distinctive   mark,   a   suggestive   mark   and   a



well   known   mark,   then   there   is   no   question   of   pleading



secondary   meaning   to   its   mark.     It   is   only   with   respect   to



descriptive marks that secondary meaning needs to be pleaded



and considered by this court.




41.    The   argument   of   the   respondent   company   is   that



`Eenadu' is not a generic or descriptive mark but a suggestive



mark.     The   difference   between   categorization   as   generic,



descriptive or suggestive is a follows:-



       *     A generic mark can never be a trademark


                                                                              22



   *      A   descriptive   mark   can   become   a   trademark   if   it

          acquires secondary meaning



   *      A suggestive mark is inherently distinctive




42.     The   line   between   suggestive   marks   and   descriptive



marks   is   very   thin.     Various   commentaries   including



McCarthy have laid down the imagination test to determine



as   to   whether   a   mark   is   descriptive   or   suggestive.     When



this test is applied to the mark `Eenadu' for a newspaper, it



is clear that the same is descriptive in nature inasmuch as



it   means   `Today',   i.e.   news   for   today.     It     does   not   require



any imagination at all.   Thus in the imagination test, if the



mark describes a characteristic of the product - in the case



of `Eenadu' the newspaper, it refers to the characteristic of



the newspaper, i.e., today's news.  `Eenadu' would therefore,



be an expression which immediately describes a newspaper.



In fact with respect to its Agarbathies, `Eenadu' would be a



completely   arbitrary   term.     However,   with   respect   to



newspapers, this is a descriptive term.


                                                                           23



43.    The   appellant   submitted   that   the   entire   object   of



including   the   4th  Schedule   in   the   Trademark   Rules   is   that



marks are to be registered for the goods and services for the



purpose for which they are used.  Non-use of a mark entails



rectification   under   section   46   of   the   1958   Act.     Thus,   the



entire   object   of   trademarks   is   to   confer   monopoly   of   a



particular  individual  or  entity  with respect to a mark for  a



particular   category   of   goods   or   category   of   services.     It   is



only in exceptional cases that a mark is protected across all



product categories.  If that was not the position, then every



trademark   owner   whose   mark   enjoys   a   reputation   in



whatever limited field and for specific goods/services, would



be  able to  claim  monopoly  for  the mark with  respect to  all



42   classes   of   goods   and   services.     This   could   never   have



been   the   intention   of   the   Legislature.               Even   while



establishing   the   criteria   for   the   marks   which   are   well-



known,   the   legislature   has   thought   it   fit   to   deal   with   the



reputation   of   such   well-known   marks   by   taking   into



consideration   factors   like   section   of   the   public,   relevant



geographical   area   etc.     Thus,   every   trade   mark   is   not


                                                                        24



entitled   to   protection   across   all   categories   as   every   trade



mark does not automatically become a "well-known mark".



If this was not the case, then there would come a time when



most   words   would   get   monopolized   across   products   and



services   which   would   not   conform   to   the   intention   behind



the Law of Trade Marks.




44.    Every mark with a reputation cannot be determined as



a well-known mark as reputation by itself does not escalate



the   mark   into   the   position   of   a   well-known   mark.   The



reputation   of   a   mark   can   be   restricted   to   a   particular



territory,  to a particular  category  of goods or services,  to a



particular   category   of   population,   to   a   particular   linguistic



section of public etc.




45.    The   appellant   submitted   that   in   most   of   the   cases



where   absolute   protection   has   been   granted,   extending   it



beyond   the   goods   and   services   in   which   the   plaintiff   deals



with,   the   mark   or   name   has   been   an   extremely   distinctive



mark.   They have either invented the mark or marks which



are   derived   from   surnames   or   marks   are   used   across


                                                                         25



categories   of   products.     The   defendant's   products   may   be



confused   from   the   other   products   originating   from   the



plaintiff, but the plaintiff has to be dealing with more than



one   products   or   services   with   respect   to   the   said



mark/name.




46.     In   the   present   case,   the   evidence   on   record   has



established that the plaintiff/respondent company has only



dealt   with   mark   `Eenadu'   for   newspapers.   The   television



channel   is   known   as   ETV   where   the   word   `Eenadu'   is   not



used for the same.  The evidence itself establishes the same.



Further it is pertinent to note that:



   7       There   is   not   a   single   document   showing   that   the


           respondent   company   is   referred   to   as   `Eenadu'



           Margdarshi's goods;



   7       Priya   is   also   a   mark   of   pickles   which   is


           manufactured by the respondent company;



   7       `Eenadu'   pickles   (if   any)   are   not   available   in   the


           local market;


                                                                             26



       7     ETV   is   the   shortcut   name   for   the   `Eenadu'


             Television;



       7     The   respondent   company   does   not   manufacture


             incense sticks;



       7     That   `Eenadu'   has   been   used   to   convey   the   literal


             meaning as "Today".




47.    The   appellant   submitted   that   in   the   background   of   this



evidence   emanating   from   the   plaintiff's   main   witness,   it   is



evident that `Eenadu' is not a distinctive mark.   It is in fact a



descriptive mark.  At best, a secondary meaning may accrue in



its favour with respect to only newspapers and nothing more.



Descriptive words which have been used only for one category



of goods cannot claim across the board protection.  `Eenadu' is



not like Volvo or Kirloskar or Harrods or Benz.




48.    `Eenadu'   would   fall   in   the   category   of   marks   like   Shell,



Safeguard,   Flexgrip,   Imperial,   Skyline   and   Financial   Times,



Heat Piller, One Day Drycleaners, Instea, Kesh Nikhar, Whipp



Toppings.   All   these   words   have   not   been   granted   protection



across the board.


                                                                              27





49.    The   respondent   company   has   argued   before   this   court



that the appellant's adoption is dishonest in view of the similar



scripts being used by the defendant.  The script being used by



the   appellant   is   a  standard   block   script   in   the   Telugu



language.   The   perusal   of   all   the   third   party   use   of   the   mark



`Eenadu'   would  reveal  that  almost   every  party   uses  the   same



script.    Thus,  there is  no dishonesty in  adoption  of  the  same



as the script is commonly used in Telugu language.   Even the



feature   film   which   has   been   released   in   2009   has   used   the



same   script.     There   is   no   dishonesty   in   the   adoption   of   the



mark   `Eenadu'   or   the   script   `Eenadu'.     The   appellant   went



through   the   process   of   applying   for   a   Search   as   prescribed



under   the   Copyright   Act.     The   appellant   obtained   a   No-



Objection in  accordance with Section 45 of  the Copyright  Act



and Rule 24(3) of the Trade Mark Rules, 1959.





50.    The   mark   `Eenadu'   meaning   DAILY   or   TODAY,   the



appellant   genuinely   adopted   the   same   to   signify   Daily   use   of



Agarbathi,   which   is   in   fact   used   on   a   daily   basis   by   persons


                                                                            28



performing   puja.     Thus,   the   appellant   does   have   a   valid   and



acceptable  explanation for  the  adoption.     It is  submitted that



for the appellant's goods, it is an arbitrary mark.





51.    The   appellant   submitted   that   in   order   to   establish   the



appellant's   bona   fides,   the   appellant   is   ready   and   willing   to



change the  script  and to prefix the word "Ashika"  in  order  to



distinguish itself from the respondent company and to ensure



that there is no confusion as to source.




52.    The   appellant   submitted   that   as   long   as   the   product   is



distinguishable  from the product of the respondent company,



the   appellant   prays   that   the   injunction   ought   to   be   modified



and   the   appellant   ought   to  be  permitting  to   adopt  the   carton



which it has proposed to use before this court.   It is incorrect



that   the   trade   made   application   for   registration   of   the   trade



mark   was   subsequent   to   the   issuance   of   the   notice.     The



appellant   submitted   that   the   respondent   company   has   not



been able to establish bona fide conduct.   This is established



from the following facts:-


                                                                            29



       a.    According   to   the   appellant,   the   mark   `Eenadu'   has


             been permitted by the respondent company to be in



             common   use   because   the   respondent   company   did



             not   take   action   against   all   those   who   had   been



             using the mark `Eenadu'.



       b.    According to the respondent company, the appellant


             stopped   using   the   mark   after   caution   notice   was



             sent to the appellant in 1995 and then commenced



             using it in 1999.   In 1995 the respondent company



             gave a notice restricting the grievance to Copyright.



             The grievance was restricted to a Disclaimer.   After



             1995   when   the   sales   of   the   appellant   began   to



             increase   from   sales   of   two   crores   to   the   sales   of



             approximately ten crores, then the suit was filed by



             the   respondent   company   on   a   false   plea   in   the



             plaint and obtained an ex-parte injunction.





53.    The   appellant   submitted   that   the   case   law   is   clear   that



confusion   as   to   source   applies   only   when   the   source   is   not



clearly stated.  The appellant in the impugned carton has used


                                                                            30



the   word   Agarbathi   along   with   the   word   `Eenadu'.     However,



Ashika's   Eenadu   completely   distinguishes   itself   from   the



respondent company.   A carton being proposed to be adopted



by the appellant which would completely eliminate any remote



chance of any confusion.




54.    Mr.   R.A.   Sundaram,   learned   Senior   Advocate   argued   on



behalf   of   the   respondent   company.     He   submitted   that



`Eenadu' is not a common Telugu word meaning "Today" and



is   not   a   common   word.     He   submitted   that   `Eenadu'   has



acquired secondary meaning and referred to and relied on the



trial   court   findings   in   that   respect.     He   submitted   that   the



appellant   failed   to   note   that   `Eenadu'   Group   is   inter   alia   a



publisher of a newspaper which is the second largest regional



daily circulating in India and is the largest in Andhra Pradesh.




55.    Mr.   Sundaram   submitted   that   the   appellant   is   a



Bangalore   based   company   which   started   manufacturing   its



products   in   Bangalore   under   the   name   "Ashika"   and   had



started  selling   its   products   in   Andhra   Pradesh   in   1995.     The



appellant started using the name `Eenadu' for its Agarbathies


                                                                           31



and used same artistic script, font and method of writing the



name cannot be a co-incidence.  The appellant is a Karnataka



company   after   adoption   of   the   name   `Eenadu'   accounted   for



90%   of   the   sale   of   their   product   Agarbathies.     The   appellant



was   restrained   from   using   the   word   `Eenadu'   in   the   State   of



Andhra   Pradesh,   their   sales   have   dropped   by   10   times



although   they   continued   to   sell   the   product   under   the   name



"Ashika".     The   appellant   glossed   over   the   fact   of   being



manufacturer of Agarbathies as is inexplicable as to why they



had   applied   for   registration   of   name   `Eenadu'   not   just   for



Agarbathies   but   inasmuch   as   34   classes   of   the   Trade   Marks



Act for goods which they do not even produce or do not have



any intention to produce which would itself show the intention



that   they   can   trade   on   the   respondent   company's   household



name   and   goodwill   and   reputation.     According   to   the



respondent   company,   all   these   facts   clearly   show   that



adoption of name `Eenadu' was by no means innocent but was



intended   to   capitalize   and   derive   benefit   on   the   goodwill   and



reputation of the respondent company which is impressible.


                                                                             32



56.    Mr.   Sundaram  submitted   the   basic   underlying   fallacy   is



that since after all the readers of a newspaper are literate and,



therefore, would be able to make out that the Agarbathies are



by the name "Ashika Eenadu" or that it comes from a different



source,   overlooks   completely   that   it   is   the   purchaser   of   the



Agarbathies   and  not  the  purchaser  of  newspaper   that we  are



concerned   with.     The   goodwill   sought   to   be   cashed   in   is   the



name   `Eenadu"   by   the   appellant   who   is   selling   Agarbathies



and   the   person   so   deceived   is   not   the   purchaser   of   the



newspaper but the purchaser of the Agarbathies.   To say that



all the purchasers of Agarbathies are illiterate people is a basic



fallacy   since   the   purchasers   of  Agarbathies   will   transcend   all



classes   of   people   in   the   society.     The   entire   submission,



therefore,   overlooks   the   basic   fact   that   the   purchaser   of   the



Agarbathies   would   be   deceived   into   believing   that   the   said



Agarbathies also come from the House of `Eenadu' and thereby



they   would   be   deceived   as   to   the   source   of   the   product,   and



this   cashing   in   on   the   goodwill   and   reputation   of   the



respondent company is impressible in law.


                                                                           33



57.    The   respondent   company's   reply   to   the   appellant's



contention that `Eenadu' is not a household name since it only



deals with newspaper is complete fallacy because the group is



known   as   "Eenadu   Margadarshi   Group"   and   the   meaning   of



`Eenadu' in various publications is stated to be the respondent



company's   group.     Furthermore,   it   also   overlooked   that   in



actual   fact   there   are   various   products   which   are   also   being



produced   and   sold   by   the   respondent   company   under   the



business name of `Eenadu'.  It is also relevant to mention that



the   `Eenadu'   TV   Channel   (also   known   as   ETV)   is   one   of   the



most popular channels and, therefore, the word `Eenadu' has



come   to   be   completely   associated   with   the   respondent



company   group   and   in   fact   is   a   household   name.     He   has



referred to the findings of the Trial Court, the High Court and



that   of   the   learned   Single   Judge   and   submitted   that   such



findings   are   not   unreasonable   so   as   to   require   interference



under section 136 of the Constitution.




58.    Mr.   Sundaram   submitted   that   `Eenadu'   is   not   a   generic



name, but in fact would be a `fancy' name outside the State of


                                                                                 34



Andhra Pradesh and within the State of Andhra Pradesh it is a



name which is not in common use, and therefore, would be a



`fancy'   name.     In   any   event,   `Eenadu'   is   not   generic   in   the



Trade  Mark's  sense  of  the   word  since  it  is   not the   use  of  the



product name itself.  What is meant by generic for Trade Mark



law   is   that   when   you   call   a   cake   a   cake   or   a   shoe   a   shoe.



When  a shoe is called  a cake or  a cake is called a shoe,  it  is



neither descriptive nor generic.   On the contrary, it is `fancy'.



The   name   `Eenadu',   therefore,   for   any   of   the   products   of   the



respondent company would not be a generic name at all.  The



appellant   overlooks   that   his   complaint   as   to   name   being



generic can only arise qua product using generic or descriptive



name.     It   is   nobody's   case   that   `Eenadu'   is   descriptive   of



Agarbathi.





59.    All   the   cases,   i.e.,   Newseek,   Ovenchips,   MaltedMilk,



Shredded   Wheat   etc.   were   cases   where   the   appellant   wanted



exclusivity of the name which was descriptive of their product



and   the   respondent   company   who   was     manufacturing   a



similar product objected to the exclusivity on the ground that


                                                                               35



the name was descriptive   of  the  product in  question.    In  this



case,   for   the   application   of   the   judgments   the   following   must



arise:-



       -     are the appellant and the respondent company dealing


             in the name product?  This is not so.



       -     is   the   word   `Eenadu'   descriptive   of   the   respondent



       company's product (i.e. Agarbathies)?  This is no so.





60.    Mr. Sundaram while dealing with the scope of passing off



action   submitted   that   the   law   of   passing   off   can   be



summarized   in   one   short   general   proposition   -   no   man   may



pass   off   his   goods   as   those   of   another.     More   specifically,   it



may be expressed in terms of the elements which the appellant



in such an action has to prove in order to succeed.  These are



there in number.



       a)      He must establish a goodwill or reputation attached


               to   the   goods   or   services   which   he   supplies   in   the



               mind   of   the   purchasing   public   by   association   with



               the identifying `get-up' (whether it consists simply of



               a   brand   name   or   a   trade   description,   or   the


                                                                       36



      individual   features   of   labeling   or   packaging)   under



      which his particular goods or services are offered to



      the public, such that the get-up is recognized by the



      public   as   distinctive   specifically   to   the   appellant's



      goods or services.



b)      He   must   demonstrate   a   misrepresentation   by   the


      respondent   company   to   the   public   (whether   or   not



      intentional)   leading   or   likely   to   lead   the   public   to



      belief   that  the  goods  or services  offered by  him are



      the   goods   or   services   of   the   appellant   and   the



      source   of   such   goods   or   services   is   the   appellant



      even if the appellant does not make such products.



c)    He   must   demonstrate   that   he   suffers   or,   in   a   quia


      timet   action,   that   he   is   likely   to   suffer   damage   by



      reason   of   the   erroneous   belief   engendered   by   the



      respondent   company's   misrepresentation   that   the



      source   of   the   respondent   company's   goods   or



      service is the same as the source of those offered by



      the appellant.


                                                                              37



       d)    Alternatively,   the   appellant   must   show   that   the


             description   or   confusion   in   the   public   is   that   the



             source   of   the   respondent   company's   product   that



             they are buying is the appellant.




61.    Learned counsel placed reliance on the following passage



from   a   well-known   case  Reddaway   &   Co.  and   Another  v.


Banham   &   Co.   and   Another  1895-99   All   ER   133     which


reads as under:-



              "The name "Glenfield" had become associated


              with the starch manufactured by the plaintiff,


              and   the   defendant,   although   he   established


              his   manufactory   at   Glenfield,   was   restrained


              from   using   that   word   in   connection   with   his


              goods in such a way as to deceive. Where the


              name   of   a   place   precedes   the   name   of   an


              article sold, it primb facie means that this is


              its   place   of   production   or   manufacture.   It   is


              descriptive, as it strikes me, in just the same


              sense   as   "camel   hair"   is   descriptive   of   the


              material   of   which   the   plaintiff's   belting   is


              made.   Lord   Westbury   pointed   out   that   the


              term   "Glenfield"   had   acquired   in   the   trade   a


              secondary   signification   different   from   its


                                                                                                38



              primary   one,   that   in   connection   with   the


              word   starch   it   had   come   to   mean   starch


              which was the manufacture of the plaintiff. In


              Massam v. Thorley's Cattle Food Co.       just


              referred to, James L.J. said:



                         "The   defendant   was   actually

                         manufacturing                      starch                       at

                         Glenfield,   having   gone   thither

                         for the purpose of enabling him

                         to         say         that              he               was

                         manufacturing   it   at   Glenfield.

                         The   House   of   Lords   said   the

                         mere   fact   that   he   was   really

                         carrying on his manufacture at

                         Glenfield,             and               was                   not

                         therefore   telling   a   lie,   did   not

                         exempt            him                   from                   the

                         consequence   of   the   fact   that

                         his   proceedings   were   intended

                         and   calculated   to   produce   on

                         the mind of the purchasers the

                         belief   that   his   article   was   the

                         article of the plaintiffs."





62.    The House of Lords was justified in observing that fallacy



lies in overlooking the fact that a word may acquire in a trade



a   secondary   signification   differing   from   its   primary   one,   and



that if it is used to persons in the trade who will understand it,



and be known and intended to understand it in its secondary


                                                                               39



sense, it will  none the less be a falsehood that in its primary



sense   it   may   be   true.   A   man   who   uses   language   which   will



convey to persons reading or hearing it a particular idea which



is   false,   and   who   knows   and   intends   this   to   be   the   case,   is



surely not to be absolved from a charge of falsehood because



in   another   sense   which   will   not   be   conveyed   and   is   not



intended to be conveyed it is true. In the present case the jury



have found that there was ample evidence to justify it, that the



words   "camel   hair"   had   in   the   trade   acquired   a   secondary



signification   in   connection   with   belting,   that   they   did   not



convey to persons dealing in belting the idea that it was made



of   camel's   hair,   but   that   it   was   belting   manufactured   by   the



plaintiffs. They have found that the effect of using the words in



the manner in which they were used by the defendants would



be to lead purchasers to believe that they were obtaining goods



manufactured by the plaintiffs, and thus both to deceive them



and   to   injure   the   plaintiffs.   On   authority   as   well   as   on



principle, the court granted relief to the plaintiffs.


                                                                                      40



63.    Mr.   Sundaram  also   placed  reliance   on  Reckitt   &  Colman


Products Ltd. v. Borden Inc. and others - 1990 (1) ALL ER 873


where the court has dealt with general law applicable to passing



off of action.  In that case the court observed thus:-




            "The   basic   underlying   principle   of     such     an

            action     was     stated     in   1842     by     Lord

            Langdale   M.R.   in   Perry   v.   Truefitt   (1842)   6

            Beav.   66   ,   73   to   be:   "A   man   is   not   to   sell  his

            own   goods   under   the   pretence   that   they   are

            the goods of another man......".  Accordingly,  a

            misrepresentation   achieving   such   a   result   is

            actionable   because   it   constitutes   an   invasion

            of   proprietary   rights   vested   in   the   plaintiff.

            However, it is a prerequisite of any successful

            passing   off   action   that   the   plaintiff's   goods

            have acquired  a reputation  in the market and

            are known by some distinguishing feature. It is

            also   a   prerequisite   that   the   misrepresentation

            has deceived or is likely to deceive and that the

            plaintiff   is   likely   to   suffer   damage   by   such

            deception. Mere confusion which does not lead

            to a sale is not sufficient. Thus, if a customer

            asks   for   a   tin   of   black   shoe   polish   without

            specifying any brand and is offered the product

            of A which he mistakenly believes to be that of

            B, he may  be confused  as  to what he  has got

            but   he   has   not   been   deceived   into   getting   it.

            Misrepresentation   has   played   no   part   in   his

            purchase".


                                                                              41



64.    He also relied on the judgment of this court in Ruston &


Hornsby Ltd. v. The Zamindara Engineering Co. - 1969 (2)


SCC 727  wherein the court observed as under:-




       "The distinction between an infringement action and

       a   passing   off   action   is   important.   Apart   from   the

       question as to the nature of trade mark the issue in

       an   infringement   action   is   quite   different   from   the

       issue in a passing off action. In a passing off action

       the issue is as follows :


              "Is the defendant selling goods so marked

              as   to   be   designed   or   calculated   to   lead

              purchasers   to   believe   that   they   are   the

              plaintiff's goods?"


       But   in   an   infringement   action   the   issue   is   as


       follows:



              "Is   the   defendant   using   a   mark   which   is

              the   same   as   or   which   is   a   colourable

              imitation of the plaintiff's registered trade

              mark ?"





65.    He   also   relied   on  Laxmikant   V.   Patel  v.  Chetanbhai



Shah and Another   - 2002 (3) SCC 65.   This court observed


as under:-




              "A   person   may   sell   his   goods   or   deliver   his

              services   such   as   in   case   of   a   profession

              under   a   trading   name   or   style.   With   the


                                                                           42



            lapse   of   time   such   business   or   services

            associated   with   a   person   acquire   a

            reputation   or   goodwill   which   becomes   a

            property   which   is   protected   by   courts.   A

            competitor   initiating   sale   of   goods   or

            services   in   the   same   name   or   by   imitating

            that  name results  in injury to the business

            of   one   who   has   the   property   in   that   name.

            The law does not permit any one to carry on

            his   business   in   such   a   way   as   would

            persuade   the   customers   or   clients   in

            believing that he goods or services belonging

            to   someone   else   are   his   or   are   associated

            therewith.   It   does   not   matter   whether   the

            latter   person   does   so   fraudulently   or

            otherwise.   The   reasons   are   two.   Firstly,

            honesty  and fair play  are,  and ought  to be,

            the   basic   policies   in   the   world   of   business.

            Secondly,   when   a  person  adopts  or  intends

            to   adopt   a   name   in   connection   with   his

            business   or   services   which   already   belongs

            to   someone   else  it  results  in  confusion  and

            has   propensity   of   diverting   the   customers

            and   clients   of   someone   else   to   himself   and

            thereby resulting in injury."





66.    Mr. Sundaram also placed reliance on a judgment of this



court   in  Satyam   Infoway  Ltd.    v.  Sifynet   Solutions  (P)


Limited  -   2004   (6)   SCC   145.     The   relevant   passage   is


reproduced as under:-




            "The next question is would the principles of

            trade   mark   law   and   in   particular   those


                                                                             43



             relating   to   passing   off   apply?   An   action   for

             passing off, as the phrase "passing off" itself

             suggests,   is   to   restrain   the   defendant   from

             passing   off   its   goods   or   services   to   the

             public   as   that   of   the   plaintiff's.   It   is   an

             action not only to preserve the reputation of

             the   plaintiff   but   also   to   safeguard   the

             public.   The   defendant   must   have   sold   its

             goods   or   offered   its   services   in   a   manner

             which   has   deceived   or   would   be   likely   to

             deceive   the   public   into   thinking   that   the

             defendant's   goods   or   services   are   the

             plaintiff's.   The   action   is   normally   available

             to the owner of a distinctive trademark and

             the   person   who,   if   the   word   or   name   is   an

             invented   one,   invents   and   uses   it.   If   two

             trade   rivals   claim   to   have   individually

             invented   the   same   mark,   then   the   trader

             who   is   able   to   establish   prior   user   will

             succeed. The question is, as has been aptly

             put, who gets these first? It is not essential

             for   the   plaintiff   to   prove   long   user   to

             establish reputation in a passing off action.

             It   would   depend   upon   the   volume   of   sales

             and extent of advertisement."




67.    Mr.  Sundaram also  relied  on  Ramdev Food Products (P)


Limited v. Arvindbhai Rambhai Patel and Others  - 2006 (8)


SCC 726 as under:-




       "A trade mark is the property of the manufacturer.

       The   purpose   of   a   trade   mark   is   to   establish   a

       connection   between   the   goods   and   the   source

       thereof which would suggest the quality of goods. If

       the   trade   mark   is   registered,   indisputably   the   user


                                                                                   44



       thereof by a person who is not otherwise authorised

       to   do   so   would   constitute   infringement.   Section  21

       of the 1958 Act provides  that where  an application

       for   registration   is   filed,   the   same   can   be   opposed.

       Ordinarily   under   the   law   and,   as   noticed

       hereinbefore,   there   can   only   be   one   mark,   one

       source   or   one   proprietor.   Ordinarily   again   right   to

       user   of   a   trade   mark   cannot   have   two   origins.   The

       first   respondent   herein   is   a   rival   trader   of   the

       appellant-Company. It did not in law have any right

       to   use   the   said   trade   mark,   save   and   except   by

       reason   of   the   terms   contained   in   the   MOU   or

       continuous   user.   It   is   well-settled   that   when

       defences   in   regard   to   right   of   user   are   set   up,   the

       onus   would   be   on   the   person   who   has   taken   the

       said   plea.   It   is   equally   well-settled   that   a   person

       cannot   use   a   mark   which   would   be   deceptively

       similar   to   that   of   the   registered   trade   mark.

       Registration   of   trade   marks   is   envisaged   to   remove

       any   confusion   in   the   minds   of   the   consumers.   If,

       thus,   goods   are   sold   which   are   produced   from   two

       sources,   the   same   may   lead   to   confusion   in   the

       minds of the consumers. In a given situation, it may

       also amount to fraud on the public. A proprietor of a

       registered   trade   mark   indisputably   has   a   statutory

       right thereto. In the event of such use by any person

       other   than   the   person   in   whose   name   the   trade

       mark is registered, he will have a statutory remedy

       in   terms   of   Section  21  of   the   1958   Act.   Ordinarily,

       therefore,   two   people   are   not   entitled   to   the   same

       trade   mark,   unless   there   exists   an   express   licence

       in that behalf."





68.    He   also   relied   on  Harrods   Limited  v.  R.   Harrod


Limited - (1924) RPC 74 where the court observed as under:-


                                                                                45



             ".........it   seems   to   me   to   be   quite   clear   that

             where   there   is   fraud   the   Court   can   interfere

             and there is fraud where you find a particular

             name   taken   by   a   defendant,   a   well   known

             fancy   name,   which   could   not   be   taken   for   a

             legitimate   purpose,   and   a   name   which   is

             taken, to use Lord Justice Buckley's words, for

             the   purpose   of   posing   as   being   some   person

             whom you are not.


             In Aerators Limited v. Tollitt (L.R. (1902) 2 Ch.,

             p.319),  Mr.Justice  Farwell,  said this, that you

             can   interfere   where   the   use   of   the   particular

             name   is   calculated   to   deceive,   even   though   it

             does not point to intentional fraud, and it is a

             question of fact in each case as to whether or

             not   the   names   were   so   alike   as   to   induce   the

             belief   that   the   companies   are   identical.     So

             that,   where   there   is   fraud,   the   court   can

             interfere, and where the names are so alike as

             to   be   calculated   to   deceive   it   can   interfere.

             Further it may draw the inference that there is

             fraud   where   there   is   an   attempt   to   pose   as

             being a particular business firm when you are

             not, and are not entitled to use their name."





69.    Mr. Sundaram also placed reliance on  Harrods Limited


v.   Harrodian School Limited  (1996) RPC 697.   In this case


the   court   held   that   the   manifold   services   and   activities   for



which   the   plaintiffs   are   known,   and   the   wide   field   of



recognition   of   the   name   "Harrods",   would   lead   to   an



assumption that, the plaintiffs are in some way are connected,


                                                                            46



associated   or   mixed-up   with   the   school   which   bears   their



name   in   its   adjectival   form.     The   court   also   observed   that



Erosion   of   distinctiveness   of   a   brand   name   had   been



recognized  as a form of damage to the goodwill  of a  business



with which the name is connected in a number of  cases, but



unless   care   was   taken   this   could   mark   an   unacceptable



extension of the law of passing off.




70.    Learned  counsel  for  the  respondent  company  also relied



on   a   judgment   of   this   Court   in   the   case   of  Midas   Hygiene


Industries   (P)   Ltd.     and   another   v.     Sudhir   Bhatia   and


others  (2004) 3 SCC 90.   The court observed that the law on


the   subject   is   well  settled.     In  cases  of  infringement  either   of



trade   mark   or   of   copyright,   normally   an   injunction   must



follow.  Mere delay in bringing action is not sufficient to defeat



grant of injunction in such cases.  The grant of injunction also



becomes necessary if it prima facie appears that the adoption



of the mark was itself dishonest.




71.    Mr.   Sundaram   also   relied   on   a   judgment   of   the   Delhi



High   Court   in   the   case   of  Madhubhan   Holiday   Inn   v.


                                                                              47



Holiday Inn Inc.  100 (2002) DLT 306 (DB)  (on which one of


us, Dalveer Bhandari, J. was the author).  The Division Bench



of the High Court observed as under:



                    "...   the   adoption   of   the   words   "Holiday

             Inn"   by   the   appellants   is  ex   facie    fraudulent

             and  mala   fide  from   the   very   inception.     The

             words "Holiday Inn" have been adopted by the

             appellant   to   ride   on   the   global   reputation   of

             the   respondent.     The   appellant   was   actuated

             by bad faith and dishonest motive.  In the facts

             and   circumstances,   the   learned   Single   Judge

             was   fully   justified   in   granting   the   injunction

             and decreeing the suits in order to protect the

             commercial   goodwill   and   to   ensure   that   the

             global business reputation of the respondent is

             not exploited by the appellants in a clandestine

             manner."



72.    Learned   counsel   for   the   respondent   company   also



submitted   that  where   a   trade/business  name   has  acquired   a



reputation such as it has become a household name.  In such



a case anyone who uses the identical name albeit in a different



field   of   business   altogether   would   be   guilty   of   passing   off   by



cashing   in   on   the   reputation   and   goodwill   of   the   business   of



the plaintiff and would be restrained.


                                                                                    48



73.       Mr.   Sundaram   also   placed   reliance   on   the   judgment   of


Harrodian   School   Limited  (supra).     The   court   observed   as


under:



                "The   absence   of   any   common   field   of   activity:

                This is of particular significance in the present

                case.     The   judge   correctly   directed   himself   as

                to the law; he cannot be faulted in the way in

                which   he   applied   it.     It   is   not  merely  that  the

                plaintiffs have never run a school and have no

                established   reputation   for   doing   so;   or   even

                that   the   nature   of   the   parties'   respective

                businesses   are   as   dissimilar   as   can   well   be

                imagined.     It   is   rather   that   the   commercial

                reputation   for   excellence   as   a   retailer   which

                the   plaintiffs   enjoy   would   be   regarded   by   the

                public as having no bearing upon their ability

                to   run   a   school.     Customers   of   the   plaintiffs

                would   be  surprised to   learn   that Harrods   had

                ventured   into   the   commercial   theatre;   they

                would, I think, be incredulous if they were told

                that   Harrods   had   opened   a   preparatory

                school."




74.       The   respondent   company   also   placed   reliance   on   a



judgment of this Court in the case of Mahendra & Mahendra


Paper   Mills   Limited     v.     Mahindra   &   Mahindra   Limited


(2002) 2 SCC 147 wherein this Court observed as under:


    

                  "Judging   the   case   in   hand   on   touchstone   of

                the principles laid down in the aforementioned

                decided cases, it is clear that the plaintiff has


                                                                                 49



            been   using   the   word   "Mahindra"   and

            "Mahindra            &         Mahindra"          in         its

            companies/business   concerns   for  a  long  span

            of time extending over five decades. The name

            has   acquired   a   distinctiveness   and   a

            secondary   meaning   in   the   business   or   trade

            circles.   People   have   come   to   associate   the

            name   'Mahindra'   with   a   certain   standard   of

            goods   and   services.   Any   attempt   by   another

            person to use the name in business and trade

            circles is likely to and in probability will create

            an   impression   of   a   connection   with   the

            plaintiffs' group of companies.  Such user may

            also   effect   the   plaintiff   prejudicially   in   its

            business   and   trading   activities.   Undoubtedly,

            the   question   whether   the   plaintiffs'   claim   of

            'passing-off   action'   against   the   defendant   will

            be   accepted   or   not   has   to   be   decided   by   the

            Court after evidence is led in the suit. Even so

            far   the   limited   purpose   of   considering   the

            prayer   for   interlocutory   injunction   which   is

            intended   for   maintenance   of   status   quo,   the

            trial   Court   rightly   held   that   the   plaintiff   has

            established a prima facie case and irreparable

            prejudice   in  its  favour   which   calls   for   passing

            an   order   of   interim   injunction   restraining   the

            defendant-company which is yet to commence

            its   business   from   utilising   the   name   of

            'Mahindra'   or   'Mahindra   &   Mahindra'   for   the

            purpose   of   its   trade   and   business.   Therefore,

            the   Division   Bench   of   the   High   Court   cannot

            be   faulted   for   confirming   the   order   of

            injunction   passed   by   the   learned   single

            Judge."




75.    Mr. Sundaram also relied on a judgment of this court in



the case of  Bata India Limited   v.   Pyare Lal & Company,


                                                                                 50



Meerut   City   &   Ors.    AIR   1985   All   242]  the   Allahabad   High


Court   observed   that   considering   the   plea   of   passing-off   or



enabling   others   to   pass-off   mattresses,   sofa   cushions   and



other articles associating them with the name of "Bata" in any



manner or form held that:



             "The   name   `Bata'   was   well   known   in   the

             market and the user of such a name is likely to

             cause   not   only   deception   in   the   mind   of   an

             ordinary   customer   but   may   also   cause   injury

             to   the   plaintiff   Company.     The   fact   that   the

             plaintiff   was   not   producing   form   was   not

             enough to hold that there could be no passing-

             off   action   in   respect   of   the   user   of   the   name

             `Bata'   to   the   products   marketed   by   the

             defendants.     The   use   of   the   name   or   mark

             `Bata'   by   the   defendants   is   indicative   of   their

             intent."




76.    Learned  counsel  for  the  respondent  company  also  relied



on   a   judgment   of   Delhi   High   Court   in   the   case   of  Diamler


Benz   Aktiegesellschaft  (supra)  wherein   the   Court   observed


as under:



             "... ... ...The boxes in which the defendant sells

             its   undergarments   for   men,   and   the

             representation   thereon   is   of   a   man   with   his

             legs   separated   and   hands   joined   together

             above his shoulder, all within a circle, indicate,

             the   strong   suggestion   of   the   link   between   the

             three pointed star of "Mercedes Benz" car and


                                                                      51



     the   undergarment's   sold   by   the   defendant.   In

     my   view,   this   cannot   be   considered   to   be   a

     "honest   concurrent   user"   by   the   defendant   of

     the above said symbol."



The Court also observed in the said case that:


     "There   are   marks   which   are   different   from

     other   marks.   There   are   names   which   are

     different   from   other   names.   There   are   names

     and   marks   which   have   become   household

     words.   "Benz"   as   name   of   a   Car   would   be

     known   to   every   family   that   has   ever   used   a

     quality   car.   The   name   "Benz"   as   applied   to   a

     car, has a unique place in the world. There is

     hardly one who is conscious of existence of the

     cars/automobiles,   who   would   not   recognize

     the name "Benz" used in connection with cars.

     Nobody   can   plead   in   India,   where   "Mercedes

     Benz"   cars   are   seen   on   roads,   where

     "Mercedes"   have   collaborated   with   Tatas,

     where   there   are   Mercedes   Benz   Tata   trucks

     have   been   on   roads   in   very   large   number,

     (known   as   Mercedes   Benz   Trucks,   so   long   as

     the   collaboration   was   there),   who   can   plead

     that he is unaware of the word "Benz" as used

     with reference to car or trucks.


     In my view, the Trade Mark law is not intended

     to protect a person who deliberately sets out to

     take  the  benefit  of  somebody  else's  reputation

     with reference to goods, especially so when the

     reputation   extends   world   wide.   By   no   stretch

     of  imagination   can  it  be   said  that  use  for   any

     length   of   time   of   the   name   "Benz"   should   be

     not objected to."


                                                                             52





The Court further observed as under:


            "However, if despite legal notice, any one big or

            small, continues to carry the illegitimate use of

            a significant world wide renowned name/ mark

            as   is   being   done   in   this   case   despite   notice

            dated 09-12-1989, there cannot be any reason

            for   not   stopping   the   use   of   a   world   reputed

            name. None should be continued to be allowed

            to   use   a   world   famed   name   to   goods   which

            have   no   connection   with   the   type   of   goods

            which   have   generated   the   world   wide

            reputation.


            In the instant case, "Benz" is a name given to a

            very high priced and extremely well engineered

            product.   In   my   view,   the   defendant   cannot

            dilute,   that   by   user   of   the   name   "Benz"   with

            respect to a product like under-wears."


77.    Mr.   Sundaram   placed   reliance   on  Harrods   Limited



(supra) where the Court observed as under:




                  "Messrs.   Harrods   Limited,   a   long

            established   and   well   known   Company   whose

            business   included   a   banking   department   but

            who   were   precluded   by   their   Articles   of

            Association   from   carrying   on   a   moneylenders

            business brought an action against R.  Harrod

            Limited,   a   Company   registered   in   August,

            1923,   with   the   object   of   carrying   on   the

            business   of   a   registered   moneylender.     The

            plaintiffs   applied   for   an   interlocutory

            injunction   "to   restrain   the   Defendant

            Company,   its   servants   and   agents   until

            judgment   or   further   order   from   carrying   on


                                                                                 53



             business under the name R. Harrod Limited or

             under any name comprising the word "Harrod"

             likely to mislead the public into the belief that

             the   Defendant   Company   was   connected   with

             the   Plaintiff   Company   or   that   the   business   of

             the Defendant Company was the same as or in

             any   way   connected   with   the   business   of   the

             Plaintiff Company."


78.    Learned   counsel   for   the   respondent   company   submitted



that   the   scope   of   passing-off   action   is   wider   than   in   an



infringement   of   trademark   or   copyright   action.     Therefore,   in



an   action   of   passing-off,   an   injunction   can   be   granted   even



against a registered trademark holder.




79.    Learned  counsel  for  the  respondent  company  also  relied



on a judgment of this Court in the case of  N.R. Dongre and


others     v.     Whirlpool   Corporation   and   another  (1996)   5


SCC   714.    In   this   case   this   Court   affirmed   the   concurrent



findings   of   the   single   Judge,   as   affirmed   on   appeal   by   the



division bench of the Delhi High Court and observed that:




             "...   ...   ...adopting   the   mark   `Whirlpool'   when

             business   in   washing   machines   was   being

             carried   out   earlier   in   other   names,   which   at

             this   stage,   is   supportive   of   the   plea   of   unfair

             trading   activity   in   an   attempt   to   obtain

             economic benefit of the reputation established


                                                                                54



             by   Plaintiff   1,   whose   name   is   associated   with

             the mark `Whirlpool'. ... ... ..."


80.    Mr.   Sundaram   also   submitted   that   common   words   with



strong   primary   meaning   retain   the   said   meaning   and



protection   would   then   be   granted   only   qua   the   product   for



which   such   common   word   is   used   viz.   Sun   TV,   Moon,   Earth



etc.     In   this   connection   learned   counsel   for   the   respondent



company relied on a case of this Court in the case of Godfrey


Philips   India   Limited     v.     Girnar   Food   &   Beverages   (P)


Limited (2004) 5 SCC 257 where this court observed as under:




             "Without   going   into   the   question   whether   the

             conclusion   arrived   at   by   the   Division   Bench

             that the trade mark is descriptive is correct or

             not,   it   appears   to   us,   and   as   is   conceded   by

             both parties before us, that the enunciation of

             principle   of   law   with   regard   to   the   protection

             available   even   in   respect   of   the   descriptive

             trade   mark   was   wrong.   A   descriptive   trade

             mark   may   be   entitled   to   protection   if   it   has

             assumed a secondary meaning which identifies

             it with a particular product or as being from a

             particular source. ... ... ..."





81.    Learned  counsel  for  the  respondent  company  also  relied



on   a   judgment   of  Delhi   High   Court   in   the   case   of  Info   Edge


(India)   Private   Limited   and   another     v.     Shailesh   Gupta


                                                                                55



and   another    98   (2002)   DLT   499   where   the   Court   observed


that:




            "It was sought to be submitted by the counsel

            appearing   for   the   defendant   that   the   word

            'Naukri'   cannot   assume   a   significance   of   a

            trademark,   as   the   same   is   generic.   The   word

            'Naukri',   would   be   a   descriptive   word   as   it

            denotes and describes the nature of work and

            business   offered   by   the   plaintiff.   The   plaintiff

            has   chosen   to   use   the   domain   name

            'Naukri.Com',   which   is   descriptive   of   the

            business,   the   plaintiff   carries   on   i.e.   it   gives

            information   to   its   subscribers   about   the

            availability of jobs and employment in various

            establishments,   concerns   and   offices   and   the

            manner   in   which   request   for   employment

            could   be   made   and,   therefore,   it   is   a   service

            offered   by   the   plaintiff   relating   to   job

            opportunity and situation and giving guidance

            thereto   and,   therefore,   the   same   is   a

            descriptive   word.   It   is   also   a   settled   law   that

            the   distinction   between   the   generic   word   and

            descriptive   word   is   very   thin   and   such   word

            could also assume a secondary meaning by its

            long   user   by   a   person,   who   establishes   his

            reputation in the market.


            If   a   product   of   a   particular   character   or

            composition is marketed in a particular area or

            place   under   a   descriptive   name   and   gained   a

            reputation   there   under,   that   name   which

            distinguished   it   from   competing   products   of

            different composition, the goodwill in the name

            of   those   entitled   to   make   use   of   it   there   was

            protected   against   deceptive   use   there   of   the

            name   of   competitors.     In  Erven   Warnink   by


                                                                               56



             and   Ors.   v.   J   Townend   &   Sons   (Hull)   Ltd.

             and   Ors.  reported   in   (1979)   2   All   ER,   it   was

             held that whether the name denoted a product

             made   from   ingredients   from   a   particular

             locality   or   whether   the   goodwill   in   the   name

             was the result of the product being made from

             particular   ingredients   regardless   of   their

             provenance,   since   it   was   the   reputation   that

             the product itself had gained in the market by

             reason   of   its   recognisable   and   distinctive

             qualities   which   had   generated   the   relevant

             goodwill.   In   the   said   case,   the   trademark   was

             the   name   of   a   spirit-based   product   called

             ADVOCAAT.   The   said   product   had   gained   a

             reputation   and   goodwill   for   that   name   in   the

             English   market   and   the   defendants   were

             seeking   to   take   advantage   of   that   name   by

             misrepresenting that their wine-based product

             was of the same type as ADVOCAAT."


82.    Mr. Sundaram placed reliance on a judgment of House of



Lords   in   the   case   of  Office   Cleaning   Services     Limited   v.


Westminster   Office   Cleaning   Association  1944   (2)   All   E   R


269,   where   the   court   observed   that   the   word   'office   cleaning'



was held to be a descriptive word, for it is a descriptive of the



business   they   carry   on.   It   was   held   that   the   plaintiff   could



assume   or   establish   monopoly   on   the   said   word   only   when



they  show  that they  have  acquired  a secondary or subsidiary



meaning. The aforesaid legal principle is well-settled and even


                                                                                  57



the   counsel   for   the   defendant   did   not   dispute   the   aforesaid



position.




83.    In Halsbury's Laws of England, Volume 48 Fourth edition



at page 190, it is stated that it is possible for a word or phrase,



which is wholly descriptive of the goods or services concerned,



to   become   so   associated   with   the   goods   or   services   of   a



particular   trader   that   its   use   by   another   trader   is   capable   of



amounting   to   a   representation   that   his   goods   or   services   are



those   of   the   first   trader   and   that   although   the   primary



meaning   of   the   words   is   descriptive,   they   have   acquired   a



secondary  meaning as indicating  the  products  of a particular



trader.




84.    In McCarthy on Trademarks and Unfair Competition Vol.



2   3rd   Edition   in   para   12.5   (2)   it   is   stated   that   in   order   to



obtain some form of relief on a "passing off" claim, the user of



a   generic   term   must   prove   some   false   or   confusing   usage   by



the newcomer above and beyond mere use of generic name.


                                                                                  58



85.    The   contention   of   the   defendant   is   that   adjectives   are



normally   descriptive   words   and   nouns   are   generic   word.



However, McCarthy has said that the said "part of speech" test



does   not   accurately   describes  the   case   law   results.   therefore,



such a criteria cannot be accepted as a safe and sound basis



to   ascertain   as   to   whether   a   particular   name   is   generic   or



descriptive.   Besides,   even   assuming   that   the   said   word   is



generic   yet   if   it   is   found   by   the   court   that   such   a   mark   has



attained distinctiveness and is associated with the business of



the plaintiff for considerable time and thereafter the defendant



adopts   a   similar   word   as   one   of   his   two   marks   to   induce



innocent   internet   users   to   come   to   the   website   of   the



defendant,   which   establishes   dishonest   intention   and   bad



faith,   would   the   court   still   be   not   granting   injunction   to



protect   the   business   of   the   plaintiff?   The   answer   to   the   said



question has to be an emphatic 'No". User of similar word by a



competitor   coupled   with   dishonest   intention   and   bad   faith



would   empower   a   court   to   restrain   such   user/misuser   to   do



equitable justice to the aggrieved party.


                                                                                 59



86.    Learned   counsel   for   the   respondent   company   also



submitted that the use of the word by another would result in



diminishing the distinctiveness of the word qua the good and



reputation of the plaintiff.




87.    Mr.   Sundaram   also   placed   reliance   on  Taittinger   and


others  v.  Allbev Limitd and others (1994) 4 All E R 75. The


relevant passages are reproduced as under:




            "...   ...   ...Further   it   cannot   be   right   that   the

            larger   the   scale   of   the   activities   of   a   trader

            suing  in passing off, the less  protection  it will

            receive   from   the   Court   because   of   a

            comparison with the scale of the activities of a

            defendant   who   trades   on   a   smaller   scale.   The

            question   is   whether   the   relevant   activities   of

            the   defendants   are   on   such   a   small   scale

            leading   to   such   a   small   injury   that   it   can   be

            ignored.   On   the   evidence   of   the   defendants'

            sales,   I   find   it   impossible   to   say   that   is   the

            case here.



            But   in   my   judgement   the   real   injury   to   the

            champagne   houses'   goodwill   comes   under   a

            different head and although the judge refers to

            Mr. Sparrow putting the point in argument, he

            does   not   deal   with   it   specifically   or   give   a

            reason for its undoubted rejection by him. Mr.

            Sparrow   had   argued   that   if   the   defendants

            continued to market their product, there would

            take   place   a   blurring   or   erosion   of   the

            uniqueness   that   now   attends   the   word


                                                                      60



champagne, so that the exclusive reputation of

the   champagne   houses   would   be   debased.   He

put   this   even   more   forcefully   before   us.   He

submitted that if the defendants are allowed to

continue   to   call   their   product   Elderflower

Champagne,   the   effect   would   be   to   demolish

the   distinctiveness   of   the   word   champagne,

and that would inevitably damage the goodwill

of the champagne houses.



In   Advocaat   case   [1980]   RPC   31   at   first

instance     Goulding   J.   held   that   one   type   of

damage   was   'a   more   gradual   damage   to   the

plaintiffs' business through depreciation of the

reputation   that   their   goods   enjoy.'   He

continued: Damage of [this] type can rarely be

susceptible of positive proof. In my judgement,

it   is   likely   to   occur   if   the   word   'Advocaat'   is

permitted   to   be   used   of   alcoholic   egg   drinks

generally   or   of   the   defendants'   product   in

particular.



In   the   House   of   Lords   in   that   case   Lord

Diplock   referred   to   that   type   of   damage   to

goodwill   as   relevant   damage,   which   he

described   as   caused   'indirectly   in   the

debasement of the reputation attaching to the

name "advocaat. ..."


In  Vine   Products   Ltd.   v.   Mackenzie   &   Co.

Ltd.  Cross J., [1969] RPC 1  commenting with

approval   on   the   decision   of   Danckwerts   J.   in

Bollinger v. Costa Brava Wine Co. Ltd. (No. 2)

said:



[Danckwerts   J.]   thought,   as   I   read   in   his

judgment,   that   if   people   were   allowed   to   call

sparkling   wine   not   produced   in   Champagne

'Champagne,'   even   though   preceded   by   an


                                                                      61



adjective   denoting   the   country   of   origin,   the

distinction   between   genuine   Champagne   and

'champagne   type'   wines   produced   elsewhere

would   become   blurred;   that   the   word

'Champagne' would come gradually to mean no

more   than   'sparkling   wine';   and   that   the   part

of   the   plaintiffs'   goodwill   which   consisted   in

the   name   would   be   diluted   and   gradually

destroyed.



That   passage   was   referred   to   approvingly   by

Gault   J.   in  Wineworths   Group   Limited     v.

Comite   Interprofessionel   du   Vin   de

Champagne  [1992]   2   NZLR   327   In   that   case

the sale of Australian sparkling wine under the

name   champagne   was   held   to   constitute

passing   off.   The  New Zealand  Court   of  Appeal

upheld the decision of Jeffries J. who had held

in C.I.V.C. v. Wineworths:



By using the word champagne on the label the

defendant   is   deceptively   encroaching   on   the

reputation and goodwill of the plaintiffs. [1991]

2 NZLR 432



Jeffries   J.   had   no   doubt   that   if   relief   was   not

granted   the   plaintiffs   would   most   certainly

suffer   damage   if   the   word   was   used   on   all   or

any   sparkling   wine   sold   in   New   Zealand.   He

thought   the   ordinary   purchaser   in   New

Zealand   without   special   knowledge   on   wines

was likely to be misled. Gault J. after agreeing

with Jeffries J. on deception said (at p.343):



I find the issue of damage or likely damage to

the goodwill with which the name 'Champagne'

is   associated   equally   obvious   in   light   of   the

finding   that   there   is   in   fact   an   established

goodwill in New Zealand. I have no doubt that


                                                                   62



erosion   of   the   distinctiveness   of   a   name   or

mark is a form of damage to the goodwill of the

business   with   which   the   name   is   connected.

There   is   no   clearer   example   of   this   than   the

debasing of the name 'Champagne' in Australia

as a result of its use by local wine makers.



By   parity   of   reasoning   it   seems  to   me   no   less

obvious   that   erosion   of   the   distinctiveness   of

the name champagne in this country is a form

of   damage   to   the   goodwill   of   the   business   of

the champagne houses. There are undoubtedly

factual   points   of   distinction   between   the   New

Zealand   case   and   the   present   case,   as   Mr.

Isaacs   has   pointed   out,   and   he   placed

particular reliance on the fact that in the New

Zealand   case   as   well   as   in   Bollinger   v.   Costa

Brava   Wine   Co.   Ltd.   (No.   2),   the   Court   held

that   there   was   a   deliberate   attempt   to   take

advantage of the name champagne, whereas in

the   present   case   the   judge   found   no   such

specific   intention.   In   general   it   is   no   doubt

easier   to   infer   damage   when   a   fraudulent

intention is established. But that fact does not

appear   to   have   played   any   part   in   the

reasoning   on   this   particular   point   either   of

Jeffries   J.   or   of   Sir   Robin   Cooke   P.,   who

thought the case exemplified the principle that

a tendency to impair distinctiveness might lead

to an inference of damage to goodwill [1992] 2

NZLR 327, or of Gault J.; nor in logic can I see

why it should. It seems to me inevitable that if

the   defendants,   with   their   not   insignificant

trade as a supplier of drinks to Sainsbury and

other   retail   outlets,   are   permitted   to   use   the

name   Elderflower   Champagne,   the   goodwill   in

the distinctive name champagne will be eroded

with   serious   adverse   consequences   for   the

champagne houses.


                                                                              63





             In   my   judgement   therefore   the   fifth

             characteristic   identified   in   Advocaat   case   is

             established. I can see no exceptional feature to

             this   case   which   would   justify   on   grounds   of

             public policy withholding from the champagne

             houses the ordinary remedy of an injunction to

             restrain passing off. I would therefore grant an

             injunction   to   restrain   the   defendants   from

             selling,   offering   for   sale,   distributing   and

             describing,   whether   in   advertisements   or   on

             labels or in any other way, any beverages, not

             being wine produced in Champagne,  under or

             by   reference   to   the   word   champagne.   That

             injunction,   I   would,   emphasise,   does   not

             prevent   the   sale   of   the   defendants'   product,

             provided it is not called champagne."




88.    Learned   counsel   for   the   respondent  company  also



submitted that the protection qua common field of activity has



now   expanded   and   been   interpreted   to   mean   extending   to



other product lines than what is manufactured by the plaintiff



and hence common field of activity is not restricted to same or



similar products but extend to all other products.   The test of



common field of activity now accepted is that of "common class



of   consumers".     The   reason   for   this   is   the   likelihood   of   such



consumers   identifying   the   Defendant's   goods   as   originating



from the same source as the plaintiff.   The question therefore


                                                                              64



would be, whether from the factual situation, an inference can



be   drawn   that   a   purchaser   of   the   Defendant's   product   could



assume such product as originating from the plaintiff.




89.    He  also  relied   on  Kamal   Trading   Co.,   Bombay   and


Others  v.  Gillette U.K. Limited  [1988] IPLR 135   wherein it


has been observed that:



            "... ... ..the plaintiffs have not established  any

            of  the   conditions   required  for   grant  of  interim

            relief.     It   was   submitted   that   the   goods

            manufactured   by   the   plaintiffs   and   the

            defendants   are   different   in   nature;   the

            plaintiffs   manufacture   blades,   while   the

            defendants manufacture "tooth brushes".   The

            goods   of   the   plaintiffs   and   the   defendants   are

            not   available   in   the   same   shop   and   the

            customers   of   these   goods   are   different.     The

            goods sold by the plaintiffs are blades and fall

            in   class   8,   while   those   of   the   defendants   are

            tooth   brushes   which   fall   in   class   21.     Relying

            on   these   circumstances,   it   was   merit   in   this

            submission.   In   the   first   instance,   the

            assumption   of   the   learned   counsel   that   the

            class   of   customers   for   purchase   of   safety

            blades   and   tooth   brushes   are   different   and

            these goods are not available in the same shop

            is wholly misconceived.  We take judicial notice

            of   the   fact   that   these   goods   are   available   in

            every   shop   including   a   small   shop   and   each

            and every person is required to purchase these

            goods. ... ... ..."


                                                                                   65



90.    Mr.   Sundaram   also   relied   on  Honda   Motors   Company


Limited       v.     Charanjit   Singh   &   Others    (101   (2002)   DLT


359) wherein it has been observed that:




              "The   case   of   the   plaintiff   is   in   fact   based   on

            passing   off   action   and   not   for   infringement   of

            the   trade   mark.   It  has   never   been  the   case   of

            the   plaintiff   that   the   two   sets   of   goods   are

            identical. The concept of passing off, which is a

            form   of   tort   has   undergone   changes   with   the

            course of time. The plaintiff now does not have

            to be in direct competition with the defendant

            to suffer injury from the use of its trade name

            by the defendants."


       The court further observed that:


            "In   the   present   case   the   plaintiff's   mark

            HONDA  has   acquired   a   global   goodwill   and

            reputation.   Its   reputation   is   for   quality

            products.   The   name   of  HONDA  is   associated

            with   the   plaintiff's   especially   in   the   field   of

            automobiles   and   power   equipments   on

            account   of   their   superior   quality   and   high

            standard.   The   plaintiff's   business   or   products

            under   the   trade   mark  HONDA  has   acquired

            such   goodwill   and   reputation   that   it   has

            become   distinctive   of   its   products   and   the

            defendants' user of this mark for their product

            "Pressure  Cooker"  tends to  mislead  the  public

            to   believe   that   the   defendants   business   and

            goods   are   that   of   the   plaintiff.   Such   user   by

            the   defendants   has   also   diluted   and   debased

            the goodwill and reputation of the plaintiff.


                                                                      66



As   observed   above,   the   concept   of   passing   off

is a tort and with the passage of time, with the

developing   case   law   it   has   changed   and   now

the two traders need not necessarily operate in

the same field so as to suffer injury on account

of the goods of one  trader  being  passed  off as

those of the other.


With the changed concept of passing off action,

it   is   now   not   material   for   a   passing   off   action

that   the   plaintiff   and   the   defendant   should

trade   in   the   same   field.   I   find   that   some

business   are   truly   international   in   character

and   the   reputation   and   goodwill   attached   to

them cannot in fact be held being international

also. The plaintiff's business is of international

character   and   obviously   the   reputation   and

goodwill attached to its trade mark  HONDA  is

also   of   international   repute.   The   plaintiff's

trade mark  HONDA, which is of global repute,

is   used   by   the   defendants   for   a   product   like

pressure   cooker,   to   acquire   the   benefit   of   its

goodwill   and   reputation   so   as   to   create

deception  for   the   public   who  are   likely   to   buy

defendant's   product   believing   the   same   as

coming   from   the   house   of                HONDA         or

associated   with   the   plaintiff   in   some   manner.

By   doing   so,   it   would   dilute   the   goodwill   and

reputation   of   the   plaintiff   and   the   wrong

committed   by   the   defendants   would   certainly

be   an   actionable   wrong   and   the   plaintiff   is

within its rights to ask for restraint against the

defendants   from   using   its   mark  HONDA  for

their products."


                                                                                67





91.    From the above discussions, the following two situations



arise:




       i.     Where   the   name   of   the   plaintiff   is   such   as   to   give


              him   exclusivity   over   the   name,   which   would   ipso



              facto extend to barring any other person from using



              the   same.         viz.   Benz,   Mahindra,   Caterpillar,



              Reliance, Sahara, Diesel etc.



       ii.    The plaintiff's adopted name would be protected if it



              has   acquired   a   strong   enough   association   with   the



              plaintiff   and   the   defendant   has   adopted   such   a



              name in common field of activity i.e. the purchasers



              test   as   to   whether   in   the   facts   of   the   case,   the



              manner   of   sale,   surrounding   circumstances   etc.



              would   lead   to   an   inference   that   the   source   of



              product is the plaintiff.


                                                                               68



92.    Learned   counsel   for   the   respondent  company  also



submitted that once there is a dishonest intention to adopt the



mark  a  mere  delay   in  bringing  an   action  will   not be   defeated



because   in   case   of   continuing   tort   fresh   period   of   limitation



begins   to   run   every   moment   of   the   time   during   which   the



breach continues.




93.   Mr.   Sundaram   relied   on   a   case   of   this   court   in  M/s.


Bengal Waterproof Limited   Vs.    M/s. Bombay Waterproof


Manufacturing   Company   and   Another    (1997)   1   SCC   99


wherein it has been observed that:




             "... ... ...It is now well settled that an action for

             passing off is  a common  law remedy  being  an

             action in substance of deceit under the Law of

             Torts.   Wherever   and   whenever   fresh   deceitful

             act   is   committed   the   person   deceived   would

             naturally   have   a   fresh   cause   of   action   in   his

             favour. Thus every time when a person passes

             off   his   goods   as   those   of   another   he   commits

             the act of such deceit. Similarly whenever and

             wherever   a   person   commits   breach   of   a

             registered trade mark of another he commits a

             recurring act of breach or infringement of such

             trade mark giving a recurring and fresh cause

             of action at each time of such infringement to

             the party aggrieved. ... ... ..."


                          ...      ...      ...


                                                                                69



                          ...      ...      ...


            In   cases   of   continuous   causes   of   action   or

            recurring causes of action bar of Order 2 Rule

            2   Sub-rule   (3)   cannot   be   invoked.   In   this

            connection   it   is   profitable   to   have   a   look   at

            Section  22  of the  Limitation  Act, 1963. It lays

            down  that  'in  the  case  of  a  continuing breach

            of contract or in the case of a continuing tort,

            a   fresh   period   of   limitation   begins   to   run   at

            every   moment   of   the   time   during   which   the

            branch   or   the   tort,   as   the   case   may   be,

            continues.   As   act   of   passing   off   is   an   act   of

            deceit and tort every time when such tortuous

            act or deceit is committed by the defendant the

            plaintiff gets a fresh cause of action to come to

            the court by appropriate proceedings. Similarly

            infringement of a registered trade mark would

            also   be   a   continuing   wrong   so   long   as

            infringement continues. Therefore, whether the

            earlier   infringement   has   continued   or   a   new

            infringement   has   taken   place   cause   of   action

            for   filing   a   fresh  suit   would   obviously  arise   in

            favour of the plaintiff who is aggrieved by such

            fresh   infringements   of   trade   mark   or   fresh

            passing   off   actions   alleged   against   the

            defendant.   Consequently,   in   our   view   even   on

            merits   the   learned   Trial   Judge   as   well   as   the

            learned Single Judge were obviously in error in

            taking   the   view   that   the   second   suit   of   the

            plaintiff   in   the   present   case   was   barred   by

            Order 2 Rule 2 Sub-rule (3), CPC."





94.    Learned counsel for the respondent company  also placed



reliance   on   another   judgment   of   this   Court   in   the   case   of


                                                                               70



Heinz Italia and another  v.  Dabur India Limited (2007) 6


SCC 1 wherein this court observed that:



            "... ....  it has  been repeatedly  held   that before

            the   use   of   a   particular   mark   can   be

            appropriated it is for the plaintiff to prove that

            the product that he is representing had earned

            a   reputation   in   the   market   and   that   this

            reputation   had   been   sought   to   be   violated   by

            the   opposite   party.   In  Corn   Products  case

            (supra)   it   was   observed   that   the   principle   of

            similarity   could   not   to   be   very   rigidly   applied

            and that if it could be prima facie shown that

            there was a dishonest intention on the part of

            the   defendant   in   passing   off   goods,   an

            injunction   should   ordinarily   follow   and   the

            mere delay in bringing the matter to Court was

            not a ground to defeat the case of the plaintiff.

            It   bears   reiteration   that   the   word   "Glucon-D"

            and   its   packaging   had   been   used   by   Glaxo

            since 1940 whereas the word "Glucose-D" had

            been used for the first time in the year 1989."




95.    Mr.   Sundaram   further   placed   reliance   on   another



judgment of this Court in Ramdev Food Products (P) Limited



(supra),  wherein it has been held that:



            "Acquiescence is a facet of delay. The principle

            of   acquiescence   would   apply   where:   (i)   sitting

            by   or   allow   another   to   invade   the   rights   and

            spending   money   on   it;   (ii)   it   is   a   course   of

            conduct   inconsistent   with   the   claim   for

            exclusive   rights   for   trade   mark,   trade   name,

            etc.


                                                                               71



             In  Power   Control   Appliances   and   Ors.   v.

             Sumeet   Machines   Pvt.   Ltd.    [1994]   1   SCR

             708, this Court stated:


                    Acquiescence   is   sitting   by,   when

                    another   is   invading   the   rights   and

                    spending money on it. It is a course

                    of   conduct   inconsistent   with   the

                    claim  for  exclusive  rights  in  a trade

                    mark,   trade   name   etc.   It   implies

                    positive   acts;   not   merely   silence   or

                    inaction   such   as   is   involved   in

                    laches."



       The court further observed that:


             "The   defence   of   acquiescence,   thus,   would   be

             satisfied when the plaintiff assents to or lay by

             in relation to the acts of another person and in

             view   of   that   assent   or   laying   by   and

             consequent   acts   it   would   be   unjust   in   all   the

             circumstances to grant the specific relief."


96.    Mr. Sundaram, counsel for the respondent company also



submitted that use of a similar mark(s) by third parties is not



a   defense   to   an   illegal   act   of   passing-off.     He   relied   on   a



judgment   of   Delhi   High   Court   in  Ford   Motor   Company     of


Canada Limited and another  v.  Ford Service Centre 2009


(39) PTC 149, wherein the Court observed that:




             "...   do   not   find   any   merit   in   the   plea   of

             defendant   of   two   others,   outside   India   using

             FORD in relation to other business. Their case


                                                                                   72



            is   not   before   this   Court   for   adjudication   and

            even if the plea of dilution was to be available

            in   an   infringement   action,   no   case   of   dilution

            in   India   is   made   out.   Recently   the   Division

            Bench   of   this   Court   in   Pankaj   Goel   v.   Dabur

            India   Limited   2008   (38)   PTC   49   (Delhi)   held

            that   merely   because   others   are   carrying   on

            business   under   similar   or   deceptively   similar

            trademark or have been permitted to do so by

            the plaintiff, cannot offer a licence to the world

            at   large   to   infringe   the   trademark   of   the

            plaintiff.   It   was   further   held   that   even

            otherwise, the use of similar marks by a third

            party   cannot   be   a   defence   to   an   illegal   act   of

            passing   off.   In   Castrol   Limited   v.   A.K.   Mehta

            1997   (17)   PTC   408   DB   it   was   held   that   a

            concession   given   in   one   case   does   not   mean

            that other parties are entitled to use the same.

            Also,   in   Prakash   Roadline   v.   Prakash   Parcel

            Service 1992 (2) Arbitration  Law Reporter 174

            it has been held that use of a similar mark by

            a   third   party   in   violation   of   plaintiff's   right   is

            no defence."


97.    Learned counsel for the respondent company also placed



reliance on  Prakash Roadline Limited   v.   Prakash Parcel


Service   (P)   Ltd.    48   (1992)   Delhi   Law   Times   390   the   Delhi


High Court held that:




            "...   ...   ...   Merely   because   no   action   is   taken

            against certain other parties, it does not mean

            that   the   plaintiff   is   not  entitled   to   take   action

            against   the   defendant.   The   other   parties   may

            not   be   affecting   the   business   of   the   plaintiff.

            They   may   be   small-time   operators   who   really


                                                                                73



             do   not   matter   to   the   plaintiff.     Therefore,   the

             plaintiff   may   not   chose   to   take   any   action

             against   them.   On   the   contrary   the   plaintiff

             feels danger from defendant in view of the fact

             that   the   defendant's   promoters   are   the   ex

             Directors/employees   of   the   plaintiff   who   are

             fully in the know of the business secrets of the

             plaintiff.   Therefore,   the   mere   fact   that   the

             plaintiff   has   not   chosen   to   take   any   action

             against   such   other   parties   cannot   disentitle

             the   plaintiff   from   taking   the   present   action.

             This   contention   is,   therefore,   prima-facie

             without any merit and is rejected."





98.    Lastly,   learned   counsel   for   the   respondent   company



submitted   that in any one  of the  following circumstances the



plaintiff   would   be   entitled   to   injunctive   relief   even   qua   a



common word:




       a.    If   the   factors   for   justifying   absolute   protection   as



             per   `absolute   protection   for   common   words'   have



             been   made   out   then   it   would   ipso   facto   entitle   the



             plaintiff to protection against the world at large.




       b.    The   protection   would   be   given   against   any



             particular   defendant   if   the   plaintiff's   name   has



             acquired   a   secondary   meaning   and   the   defendant


                                                                            74



             uses   the   name   in   a   common   field   of   activity,   i.e.



             where there are common purchasers.   However, the



             court may decline to grant the relief if such name is



             descriptive of the defendant's product and not just a



             name unconnected with the defendant's product.




       c.    The   protection   would   be   granted   qua   a   defendant



             with   relation   to   even   an   unrelated   product   where



             the tests of dishonest adoption are satisfied and the



             defendant   will   be   restrained   from   cashing   in   or



             profiting from the plaintiff's name.




99.    We   have   heard   the   detailed   and   comprehensive



arguments   advanced   by   the   learned   counsel   for   the   parties.



We   place   on   record   our   appreciation   for   the   able   assistance



provided by the learned counsel for the parties in this case. We



have also carefully examined relevant decided Indian, English



and American cases.




100. The   respondent   company's   mark   `Eenadu'   has   acquired



extra-ordinary reputation and goodwill in the State of Andhra


                                                                           75



Pradesh.   `Eenadu'   newspaper   and   TV   are   extremely   well



known   and   almost   household   words   in   the   State   of   Andhra



Pradesh.     The   word   `Eenadu'   may   be   a   descriptive   word   but



has   acquired   a   secondary   or   subsidiary   meaning   and   is   fully



identified   with   the   products   and   services   provided   by   the



respondent company.




101. The appellant is a Karnataka based company which has



started manufacturing its product in Bangalore in the name of



`Ashika' and started selling its product in the State of Andhra



Pradesh   in   1995.     The   appellant   started   using   the   name



`Eenadu'   for   its   Agarbathi   and   used   the   same   artistic   script,



font  and method of writing  the  name  which obviously cannot



be   a   co-incidence.   The   appellant   company   after   adoption   of



name   `Eenadu'     accounted   for   90%   of   sale   of   their   product



Agarbathi.




102.      On   consideration   of   the   totality   of   facts   and



circumstances   of   the   case,   we   clearly   arrive   at   the   following



findings and conclusions :


                                                             76



a)    The respondent company's mark `Eenadu' has


      acquired extraordinary reputation and goodwill



      in   the   State   of   Andhra   Pradesh.             The



      respondent   company's   products   and   services



      are   correlated,   identified   and   associated   with



      the word `Eenadu' in the entire State of Andhra



      Pradesh.         `Eenadu'   means   literally   the



      products   or   services   provided   by   the



      respondent   company   in   the   State   of   Andhra



      Pradesh.     In   this   background   the   appellant



      cannot   be   referred   or   termed   as   an   honest



      concurrent user of the mark `Eenadu';



b)    The adoption of the words `Eenadu' is  ex facie


      fraudulent   and   mala   fide   from   the   very



      inception.     By   adopting   the   mark   `Eenadu'   in



      the   State   of   Andhra   Pradesh,   the   appellant



      clearly   wanted   to   ride   on   the   reputation   and



      goodwill of the respondent company;



c)    Permitting   the   appellant   to   carry   on   his


      business   would   in   fact   be   putting   a   seal   of


                                                                 77



      approval   of  the   court  on  the   dishonest,   illegal



      and clandestine conduct of the appellant;



d)    Permitting   the   appellant   to   sell   his   product


      with the mark `Eenadu' in the State of Andhra



      Pradesh   would   definitely   create   confusion   in



      the   minds   of   the   consumers   because   the



      appellant   is   selling   Agarbathies   marked



      `Eenadu'   as   to   be   designed   or   calculated   to



      lead   purchasers   to   believe   that   its   product



      Agarbathies   are   in   fact   the   products   of   the



      respondent   company.     In   other   words,   the



      appellant wants to ride  on  the reputation and



      goodwill  of the  respondent  company.     In  such



      a   situation,   it   is   the   bounden   duty   and



      obligation   of   the   court   not   only   to   protect   the



      goodwill   and   reputation   of   the   respondent



      company but also to protect the interest of the



      consumers;



e)    Permitting   the   appellant   to   sell   its   product   in


      the State of Andhra Pradesh would amount to


                                                               78



      encouraging the appellant to practise fraud on



      the consumers;



f)    Permitting   the   appellant   to   carry   on   his


      business  in the name of `Eenadu' in the State



      of Andhra Pradesh would lead to eroding extra-



      ordinary   reputation   and   goodwill   acquired   by



      the   respondent   company   over   a   passage   of



      time;



g)    Appellant's   deliberate   misrepresentation   has


      the   potentiality   of   creating   serious   confusion



      and   deception   for   the   public   at   large   and   the



      consumers   have   to   be   saved   from   such



      fraudulent   and   deceitful   conduct   of   the



      appellant.



h)    Permitting   the   appellant   to   sell   his   product


      with the mark `Eenadu' would be encroaching



      on   the   reputation   and   goodwill   of   the



      respondent company and this would constitute



      invasion   of   proprietary   rights   vested   with   the



      respondent company.


                                                                           79



        i)          Honesty and fair play ought to be the basis of



                    the policies in the world of trade and business.




103.          The law is consistent that no one can be permitted



to encroach upon the reputation and goodwill of other parties.



This   approach   is   in   consonance   with   protecting   proprietary



rights of the respondent company.




104.          Consequently, the appeals are disposed of in terms



of the aforesaid observations and directions.




105.          In   the   facts   and   circumstances   of   this   case,   the



parties are directed to bear their own costs.





                                   ..................................................J.

                                        (Dalveer Bhandari)





                                   .................................................J.

                                         (K.S. Panicker Radhakrishnan)


New Delhi;

March 3, 2011