2003 (4) TMI 405 - HC - Companies Law

Court grants injunction against deceptive trademark use, recognizes Receiver's authority, protects goodwill of dissolved partnership.

The court granted an injunction to restrain the defendants from using the trademarks 'Mastman' and 'Postiano' due to their deceptive similarity to the ... Rights conferred by registration Issues Involved:1. Injunction against infringement of the registered trademarks 'Mastaan' and 'Postman'.2. Passing-off of goods under the trademarks 'Mastman' and 'Postiano'.3. Maintainability of the suit by the Court Receiver.4. Existence and protection of goodwill post-dissolution of the partnership firm.5. Deceptive similarity between the trademarks in question.6. Balance of convenience and likelihood of damage to the plaintiff.Issue-Wise Detailed Analysis:1. Injunction Against Infringement of Registered Trademarks:The plaintiff sought an injunction to restrain the defendants from infringing the registered trademarks 'Mastaan' and 'Postman' by using the trademarks 'Mastman' and 'Postiano'. The court found that the trademarks 'Mastaan' and 'Postman' were registered and had acquired significant goodwill over decades. The court held that the plaintiff was entitled to an injunction on the grounds of both passing-off and infringement, as the marks 'Mastman' and 'Postiano' were found to be deceptively similar to 'Mastaan' and 'Postman', respectively.2. Passing-Off of Goods:The court examined whether the plaintiff could seek an injunction against passing-off despite the cessation of the business. It was established that the partnership firm had used the trademarks 'Mastaan' and 'Postman' for decades, creating substantial goodwill. The court held that the goodwill of the business survives dissolution and can be protected. The court concluded that the plaintiff was entitled to an injunction against passing-off, as the deceptive similarity of the defendants' marks could mislead customers and damage the plaintiff's goodwill.3. Maintainability of the Suit by the Court Receiver:The defendants argued that the suit was not maintainable as it was filed by the Court Receiver, who had no proprietary rights in the trademarks. The court rejected this argument, stating that the Receiver, appointed under section 94 and Order 40 rule 1 of the Code of Civil Procedure, 1908, has all the powers of the owner, including the right to bring a suit to protect and preserve the property. The court held that the Receiver was competent to file the suit for infringement and passing-off.4. Existence and Protection of Goodwill Post-Dissolution:The court addressed whether the goodwill of the dissolved partnership firm still existed and could be protected. It was noted that the Indian Partnership Act, 1932, recognizes the goodwill of a firm as part of its property, which survives dissolution and can be sold. The court concluded that the goodwill of the partnership firm, including its trademarks, continued to exist and could be protected until the winding up was complete.5. Deceptive Similarity Between Trademarks:The court analyzed the similarities between the trademarks 'Mastaan' and 'Mastman', and 'Postman' and 'Postiano'. It was found that the words and the visual appearance of the marks were deceptively similar. The court noted the phonetic similarity and the resemblance in design, color scheme, and get-up. The court held that the defendants' marks were likely to cause confusion among customers, leading to an infringement of the plaintiff's trademarks and passing-off.6. Balance of Convenience and Likelihood of Damage:The court considered the balance of convenience and the likelihood of damage to the plaintiff. It was determined that the plaintiff's trademarks, which had acquired substantial goodwill, would be significantly devalued by the defendants' use of deceptively similar marks. The court held that the plaintiff was likely to suffer substantial damage, and the balance of convenience favored granting the injunction to prevent further erosion of the trademarks' value.Conclusion:The court allowed the notice of motion, granting an injunction to restrain the defendants from using the trademarks 'Mastman' and 'Postiano' due to their deceptive similarity to the plaintiff's registered trademarks 'Mastaan' and 'Postman'. The court also recognized the Receiver's authority to file the suit and upheld the existence and protection of the goodwill of the dissolved partnership firm. The defendants' request for a stay of the judgment was granted until 12-6-2003.