TaxTMI 
TaxTMI 
TaxTMI 
2015 (3) TMI 1197
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....urt. The Appellant herein filed an appeal against the said decree before the High Court of Madras. The High Court has dismissed the appeal, thereby affirming the decree of the trial court, vide judgment dated 07.06.2013. It is this judgment which is challenged by the Appellant/defendant in the present proceedings. The case set up by the Respondent/plaintiff in her suit was that her father -in -law, Mr. R. Krishna Singh, started the business of selling halwa in the year 1900 at East Car Street, Tirunelveli Town. After the death of Mr. R. Krishna Singh, the Respondent's husband late K. Bijili Singh, who is the son of Mr. R. Krishna Singh, continued the business till his death in the year 2000. After his death, the Respondent, who is the daughter -in -law of late Mr. R. Krishna Singh, continued to carry on the business of selling halwa. It was also claimed that the product of halwa assumed an unique name of 'Iruttukadai Halwa' not only at Tirunelveli in Tamil Nadu region, but also in other parts of India as well as in foreign countries. It was further claimed that from the year 1900 till now, 'Irruttukadai Halwa Shop' would open only at 5.00 p.m. or 5.30 p.m., and ....
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....y on 30.07.2007 refusing to stop the selling of halwa. On the receipt of the aforesaid reply dated 30.07.2007 refusing to accede to the demand of the Respondent, the Respondent filed the suit for declaration, permanent injunction and rendition of accounts. 2. The Appellant defended and contested the said suit by filing the written statement. It was pleaded that it was not open to the Respondent to claim that the halwa manufactured in their shop alone has got the sweet taste, forgetting for a minute that every halwa manufactured in Tirunelveli by using Tamirabarani river. Further, it was also pleaded that when the Appellant having run the halwa shop business for 40 years in the same place in the name of Raja Sweets and the shop of the Defendant is situated five kilometers away from the Plaintiffs shop, the question of cheating the public does not arise at all. When the Appellant alone has got the name board in the style of 'Tirunelveli Iruttukadai Halwa', the Respondent, having not displayed any such name board either in front of their shop or anywhere in Tirunelveli city, there is no question of making allegation that the Appellant is attempting to deceive the public by u....
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....as proved by placing various documents. On this basis, the trial court recorded the finding that the Respondent is the prior user of the word 'Iruttukadai Halwa' and, therefore, she is entitled to the decree for declaration and injunction. 4. The High Court has also affirmed the aforesaid findings observing that the Respondent's trade mark name 'Iruttukadai Halwa' had become a household name in the nook and corner of the State of Tamil Nadu. There was even a famous Tamil song from the movie "Samy" wherein name of this halwa was mentioned time and again. Therefore, opined the High Court, no one can claim as his own name 'Iruttukadai Halwa' except the Respondent. The High Court recognised the fact that the Appellant had also got the trade mark 'Iruttukadai Halwa' registered. However, no credence to this aspect is given by the High Court on the ground that as a prior user with prior registration of the trade mark the Respondent had exclusive right to this trade mark. Another reason to confirm the decree is predicated on Section 34 of the Act, as per which rights of the prior user of the trade mark has been well recognized. The observations o....
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....user the Respondent's trade mark has acquired a distinct reputation and goodwill in the business under the name and style 'Iruttukadai Halwa'. Therefore, as a prior user the Respondent/plaintiff will be entitled to injunction against the Respondent. (ii) Because of the distinct reputation and goodwill earned by the Respondent in respect of trade mark 'Iruttukadai Halwa' the use of trade mark by the Appellant under the name and style of "Tirunelveli Iruttukadai Halwa', even when it is registered trade mark, will amount to deceiving the public and nobody is allowed to encroach upon the goodwill and reputation of the other party. In effect, rule against 'passing off is applied to give the relief." 6. The submission of Mr. Mani, learned Advocate appearing for the Appellant, while questioning the validity of the aforesaid judgment was that even the Appellant had been selling the halwa and sweets in Tirunelveli for last 40 years in the same place in the name of 'Raja Sweets'. It was further submitted that shop of the Appellant is situated 5 kilometers away from the Respondent's shop and, therefore, the question of cheating the public does not ari....
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.... Respondent claims prior user of the trade mark 'Iruttukadai Halwa'. Moreover, she is also registered owner of this trade mark which she got registered in the year 2007. This registration is even prior to the registration of trade mark in favour of the Appellant. But at the same time, we have the Appellant who is also a registered owner of the trade mark 'Tirunelveli Iruttukadai Halwa' which was registered by the Registrar in the year 2008. In the fact situation, when the Appellant also has the trade mark duly registered in his favour Under Section 25(2) of the Act, what are the implications thereof, is the question. To put it otherwise, what are the rights of a registered trade mark holder against other person who also hold a valid registration of his trade mark, is the moot question. Before we advert to and answer this core issue, it becomes imperative to scan through the relevant provisions of the Act, in order to understand the scheme of subject matter in issue. 9. Chapter III of the Act pertains to the 'Procedure For And Duration of Registration'. For getting a trade mark registered, an application can be preferred Under Section 18 of the Act. Su....
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....uch a counter statement, it is deemed that he has abandoned his application. On the other hand, if the counter statement is submitted by the applicant, copy thereof is to be served upon the person giving notice of opposition. Thereafter, both the applicant as well as opponent are given an opportunity to file their respective evidence. After receiving such evidence, the Registrar is duty bound to give an opportunity of hearing to both of them, if they so desire. After hearing the parties and considering the evidence, the Registrar is to take a decision as to whether he would be permitting the registration or rejecting the application. At this stage, if the Registrar feels that the mark considered as a whole is likely to create confusion, he is empowered to refuse the registration. Once the application is accepted and either there is no opposition thereto within the time permitted to file such objections or objections, if filed, are decided in favour of the applicant, the Registrar shall, unless the Central Government otherwise directs, register the said trade mark and this process is to be completed within 18 months of the filing of the application. Section 23 mandates such a regi....
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....ed on the basis that the Appellant's trade mark was registered in the year 2008, more so when we find that actual date has no bearing to the outcome. Effect of registration is provided in Chapter IV of the Act in Section 27. This Section provides that no infringement will lie in respect of an unregistered trade mark. However, Section 27(2) recognises the common law rights of the trade mark owner to take action against any person for passing of goods as the goods of another person or as services provided by another person or the remedies thereof. Section 27reads as under: "27. No action for infringement of unregistered trade mark. (1) No person shall be entitled to institute any proceeding to prevent, or to recover damages for, the infringement of an unregistered trade mark. (2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off goods or services as the goods of another person or as services provided by another person, or the remedies in respect thereof." 13. Section 28 which is very material for our purpose, as that provision confers certain rights by registration, is reproduced below in its entirety: "28. Rights conferred ....
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....hich means this provision gives concurrent right to both the persons to use the registered trade mark in their favour. Otherwise also, it is a matter of common -sense that the Plaintiff can not say that its registered trade mark is infringed when the Defendant is also enjoying registration in the trade mark and such registration gives the Defendant as well right to use the same, as provided in Section 28(1) of the Act. 15. However, what is stated above is the reflection of Section 28 of the Act when that provision is seen and examined without reference to the other provisions of the Act. It is stated at the cost of repetition that as per this Section owner of registered trade mark cannot sue for infringement of his registered trade mark if the Appellant also has the trade mark which is registered. Having said so, a very important question arises for consideration at this stage, namely, whether such a Respondent can bring an action against the Appellant for passing off invoking the provisions of Section 27(2) of the Act. In other words, what would be the interplay of Section 27(2) and Section 28(3) of the Act is the issue that arises for consideration in the instant case. As alread....
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....e of registration. The said provision 28 (3) nowhere comments about the rights of passing off which shall remain unaffected due to overriding effect of Section 27(2) of the Act and thus the rights emanating from the common law shall remain undisturbed by the enactment of Section 28(3) which clearly states that the rights of one registered proprietor shall not be enforced against the another person. Section 34 of the Trade Marks Act, 1999 provides that nothing in this Act shall entitle the registered proprietor or registered user to interfere with the rights of prior user. Conjoint reading of Section 34, 27 and 28 would show that the rights of registration are subject to Section 34 which, can be seen from the opening words of Section 28 of the Act which states "Subject to the other provisions of this Act, the registration of a trade mark shall, if valid, give to the registered proprietor.." and also the opening words of Section 34 which states "Nothing in this Act shall entitle the proprietor or a registered user of registered trade mark to interfere..". Thus, the scheme of the Act is such where rights of prior user are recognized superior than that of the registration and even t....
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.... goodwill, misrepresentation and damage are independent to that of registered rights. The mere fact that both prior user and subsequent user are registered proprietors are irrelevant for the purposes of examining who generated the goodwill first in the market and whether the latter user is causing misrepresentation in the course of trade and damaging the goodwill and reputation of the prior right holder/former user. That is the additional reasoning that the statutory rights must pave the way for common law rights of passing off. C. Thirdly, it is also recognized principle in common law jurisdiction that passing off right is broader remedy than that of infringement. This is due to the reason that the passing off doctrine operates on the general principle that no person is entitled to represent his or her business as business of other person. The said action in deceit is maintainable for diverse reasons other than that of registered rights which are allocated rights under Recent Civil Reports the Act. The authorities of other common law jurisdictions like England more specifically Kerry's Law of Trademarks and Trade Names, Fourteenth Edition, Thomson, Sweet & Maxwell South Asian....
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....4 are analogous to Indian Trade Marks Act, 1999) that the registration is no defense to a passing off action and nor the Trade Marks Act, 1999 affords any bar to a passing off action. In such an event, the rights conferred by the Act under the provisions of Section 28 has to be subject to the provisions of Section 27(2) of the Act and thus the passing off action has to be considered independent Truttukadai Halwa' the provisions of Trade Marks Act, 1999. D. Fourthly, It is also well settled principle of law in the field of the trade marks that the registration merely recognizes the rights which are already pre -existing in common law and does not create any rights. This has been explained by the Division Bench of Delhi High Court in the case of Century Traders v. Roshan Lal Duggar Company : AIR 1978 Del 250 in the following words: "First is the question of use of the trade mark. Use plays an all important part. A trader acquires a right of property in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. The trader who adopts such a mark is entitled to protection directly the article havin....
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....cob J. in 1956 RPC 1. In the matter of Vitamins Ltd.'s Application for Trade Mark at p. 12, and particularly the following: ] "A proprietary right in a mark sought to be registered can be obtained in a number of ways. The mark can be originated by a person or can be acquired, but in all cases it is necessary that the person putting forward the application should be in possession of some proprietary right which, if questioned, can be substantiated". Law in India under our present Act is similar." We uphold said view which has been followed and relied upon the courts in India over a long time. The said views emanating from the courts in India clearly speak in one voice which is that the rights in common law can be acquired by way of use and the registration rights were introduced later which made the rights granted under the law equivalent to the public user of such mark. Thus. we hold that registration is merely a recognition of the rights pre -existing in common law and in case of conflict between the two registered proprietors, the evaluation of the better rights in common law is essential as the common law rights would enable the court to determine whose rights between the....
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.... mentioned with the address at No. 14, East Car Street, Tirunelveli Town. Moreover, another interesting article published in Ananda Viketan, a weekly magazine dated 14.09.2003 in the State of Tamil Nadu clearly brings home the case of the Plaintiff for the grant of declaration and injunction against the Defendant on the ground that the word 'Iruttukadai halwa' means and indicates only the halwa sold at Door No. 14, East Car Street, Tirunelveli Town belonging to the Plaintiff alone. Moreover, the Plaintiff has also registered the trade mark 'Iruttukadai halwa' Under Section 25(2) of the Trade Marks Act, 1999 with the Registrar. Under Clause 16 even the paper and paper articles etc., and the trade mark's certificate issued and registered under Clause 30 also clearly proves the case of the Plaintiff that she is the prior user of the trade mark 'Iruttukadai halwa'. Therefore, the trial Court accepting the case of the Respondent that she has officially registered the trade mark as a prior user rightly granted the decree for declaration and injunction against the Defendant. When the Plaintiff has proved that the person who gets into the business at the first ....