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TaxTMI 
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2026 (3) TMI 500
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....th and Ms. Vanshika Singh, Advs. For the Respondents Through: Ms. Rashi Bansal, Mr. Saurabh Lal and Ms. Deepti Thapa, Adv. Mr. R.V. Sinha and Mr. A.S. Singh, Advs. for R-2 and 3., Mr. Dushyant K. Mahant and Mr. Vimlesh Kumar, Advs. for R-1, Mr. Sidharth Chopra, Mr. Kanishk Kumar, Mr. Angad Makkar and Mr. Priyansh Kohli, Advs. JUDGMENT PER C. HARI SHANKAR, J. S.No. Subject Para Nos 1 A The lis 1-3 FAO (OS) (Comm) 146/2024, FAO (OS) (Comm) 147/2024, FAO (OS) (Comm) 148/2024, FAO (OS) (Comm) 151/2024 and FAO (OS) (Comm) 152/2024 2 B Facts 4-11 3 C The Issues 12-16 4 D Sections 29, 30(3) and 30(4) and the decision in Kapil Wadhwa 5 I Sections 29, 30(3) and 30(4) 20-45 6 II The decision in Kapil Wadhwa 46-52 7 E The Impugned Judgment 8 I Facts of the case as noted in the impugned judgment 53-54 9 II Appellants' contentions before learned Single Judge 55-62 10 III Respondents' contentions before learned Single Judge 63-68 11 IV Observations and findings in the impugned judgment 12 IV.1 Re. Importation and sale 70-72 13 IV.2 S....
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....ty. The HDDs are extracted from the equipment in which they were integrated and imported into India. 2. These appeals fall into two categories. The respondents in FAO (OS) (Comm) 146/2024 (Geonix International Pvt Ltd ["Geonix"]), FAO (OS) (Comm) 147/2024 (Daichi International ["Daichi"]) and FAO (OS) (Comm) 148/2024 (Consistent Infosystems Pvt Ltd) purchase the HDDs after they are removed from the equipment abroad and imported into India whereas Hansraj Dugar, the respondent in FAO (OS) (Comm) 104/2025, himself imports the HDDs into India, after they are removed from the equipment abroad. 3. We will also deal with these matters separately. FAO (OS) (Comm) 146/2024, FAO (OS) (Comm) 147/2024, FAO (OS) (Comm) 148/2024, FAO (OS) (Comm) 151/2024 and FAO (OS) (Comm) 152/2024 B. Facts 4. WD and Seagate, the appellants in these appeals, manufacture HDDs and sell them to OEMs located in China. The HDDs bear the appellants' trade marks, registered under Section 23 of the Trade Marks Act, 1999 ["the Act"]. Once the HDDs reach "end of life" stage, the warranty provided by WD and Seagate comes to an end, the equipment in which the HDDs were installed is discarded, the HDDs are e....
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....estraining the respondents from performing the afore noted activities, pending disposal of the suits. 10. A learned Single Judge of this Court, by judgment dated 21 May 2024, disposed of the Order XXXIX applications filed by the appellants with the following directions: "The defendants will be permitted to sell the refurbished HDDs, provided they comply with the following: (i) Packaging to identify the source of the product: Packaging in which the refurbished product is sold, will clearly indicate that the HDD is manufactured by the plaintiffs concerned (Seagate or WD as the case may be). This may be displayed in a manner not to deceive the customer that the sale itself is of the original Seagate or WD i.e. it should be clear, but not dominating the packaging. (ii) Reference to the original manufacturer is to be made through their word mark and not the device mark: Reference to the plaintiffs should be through their word marks as in "Seagate" or "WD", as the case may be. Defendant shall not use plaintiffs' logos, in order to not cause any deception to the consumer. (iii) Packaging must specify that there is no original manufacturer's w....
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....he appellants, or are guilty of passing off, or reverse passing off. 15. We are dealing with these aspects in appellate jurisdiction over a judgment rendered by the learned Single Judge under Order XXXIX of the CPC. The analysis is, therefore, merely prima facie. Equally, we would remain guided by the decisions in Wander Ltd v. Antox (India) Pvt Ltd 1990 (Supp) SCC 727 and Pernod Ricard India Pvt Ltd v. Karanveer Singh Chhabra 2025 SCC OnLine SC 1701, which hold that an appeal against an interlocutory Order XXXIX order is merely an appeal on principle, and the appellate Court would not substitute its subjective opinion for the opinion of the Commercial Court. 16. We have heard Mr. Pravin Anand for WD, Mr. Ranjan Narula for Seagate, Mr. Dushyant Mahant for Consistent and Ms. Rashi Bansal for Daichi and Geonix. D. Sections 29, 30(3) and 30(4) and the decision in Kapil Wadhwa 17. These appeals necessitate an intricate navigation through Sections 29, 30(3) and 30(4) of the Act, and we propose to undertake the exercise at the very outset, so that the legal boundaries, within which we would be require to limit our excursions, are clearly drawn. 18. As would become apparent....
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....on. 25. The only provision in the Act which envisages what "infringement" would be, and which is a self-contained code in that regard, is Section 29. If an act satisfies one or more of the sub-sections of Section 29, it would amount to infringement. Else, it would not. There is no other provision, in the Act, which deems any act to amount to infringement. 26. Section 30(3), therefore, merely clarifies that, even if an act amounts to infringement under Section 29, it would nonetheless not be infringement if the circumstances in Section 30(3) apply. If an act does not amount to infringement within the meaning of Section 29, therefore, in the very first instance, no occasion to refer to Section 30(3) would arise at all. This is one of the contentions of Mr. Dushyant Mahant, and we entirely agree with him. 27. Section 30(4) excepts the applicability of Section 30(3) in certain circumstances. This does not mean that the act would, then, ipso facto amount to infringement, as Mr. Pravin Anand would seek to contend. It merely means that, if the circumstances of Section 30(4) apply, the escape clause, otherwise available under Section 30(3) to acts which are infringing within the m....
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....Mr. X has acquired the goods, the proprietor of the trade mark assigns it to someone else. That circumstance does not apply in the appeals before us. 35. Circumstance (b) applies where the proprietor of the trade mark has himself put the goods on the market, or consented to their being put on the market. 36. In other words, if goods bearing a registered trade mark are put on the market by the registered proprietor of the mark, or with his consent, then the sale, or dealing, in such goods, by Mr. X, would not result in infringement. 37. By putting them on the market, or consenting to their being put on the market, the registered proprietor of the mark has thus exhausted his right to allege that the sale, or dealing, in the goods, by a person who lawfully acquires them, results in infringement. 38. If, however, the goods in which Mr. X deals does not bear the registered trade mark of the original manufacturer (as in the present appeals), such dealing would not, in any event, amount to infringement under Section 29, as Section 29, in each of its clauses, requires the infringer to use the infringed trade mark, or a trade mark which is deceptively similar thereto, in the cou....
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....et. Equally, if the lawful acquirer of the goods, who sells them in the market, affixes his mark on them, that, too, cannot constitute a legitimate reason for the registered proprietor of the mark to oppose their sale or dissemination. The word "change", therefore, must result in something negative resulting; in other words, the word "changed" must be read noscitur a sociis with the word "impaired". They must partake of a like character. 44. The noscitur a sociis principle is as old as the hills, and is a hallowed principle of interpretation of statutes, predicated on the principle that words, in a statue, take colour from the company they keep. As far back as in Angus Robertson v. George Day (1879) 5 AC 63, referenced in M.K. Ranganathan v. Govt. of Madras, AIR 1955 SC 604 and Ahmedabad Primary Private Teachers Assn v. Administrative Officer, (2004) 1 SCC 755, the Privy Council observed that it was "a legitimate rule of construction to construe words in an Act of Parliament with reference to words found in immediate connection with them". A subset of the noscitur a sociis principle is the ejusdem generis doctrine, which applies where there are a number of expressions used toget....
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....ewise: "42. There is a patent fallacy in paragraph 68(c). There is no law which stipulates that goods sold under a trade mark can be lawfully acquired only in the country where the trade mark is registered. In fact, the legal position is to the contrary. Lawful acquisition of goods would mean the lawful acquisition thereof as per the laws of that country pertaining to sale and purchase of goods. Trade Mark Law is not to regulate the sale and purchase of goods. It is to control the use of registered trade marks. Say for example, there is food scarcity in a country and the sale of wheat is banned except through a canalizing agency. Lawful acquisition of wheat in that country can only be through the canalizing agency. The learned Single Judge has himself recognized that the law of trade marks recognizes the principle of international exhaustion of rights to control further trade of the goods put on the market under the trade mark. The task of the learned Single Judge thus was to resolve the impasse in the Indian Law, and thus the presumption/assumption in paragraph 68(c) could not be the point to resolve the textual context in which the learned Single Judge has discussed in p....
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.... on the market thereof, and then imported into India. Only then would there be a difference in the language of the literature provided with the product; difference in services and warranties in the country from where the goods are imported by the seller and the country of import i.e. the manufacturer's warranties not being available in the country of import; difference in quality control, pricing and presentation as also differences in advertising and promotional efforts. 70. This is also an indication of India adopting the Principle of International Exhaustion of Rights in the field of the Trade Mark Law. 71. We accordingly conclude that 'the market' contemplated by Section 30(3) of the Trade Marks Act 1999 is the international market i.e. that the legislation in India adopts the Principle of International Exhaustion of Rights. 72. That leaves the last submission of the respondents, that in view of Section 30(4) they are entitled to oppose further dealings by importers of their printers to India. 73. It is not the case of the respondents that the appellants are changing the condition of the goods or impairing the goods which are put in the f....
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....n design their website in a manner where they are able, on their own strength, without any meta-tagging, to display the relevant information. 75. The appeal is partially allowed. Impugned judgment and order dated February 17, 2012 is set aside insofar the appellants have been restrained from importing printers, ink cartridges/toners bearing the trade mark Samsung/SAMSUNG and selling the same in India. The appellants shall continue to remain injuncted from meta-tagging their website to that of the respondents. But, while effecting sale of Samsung/SAMSUNG printers and ink cartridges/toners, the respondents shall prominently display in their showrooms that the product sold by them have been imported from abroad and that the respondents do not give any warranty qua the goods nor provide any after sales service and that the warranty and after sales service is provided by the appellants personally. The appellants would prominently display in their showrooms: Samsung/SAMSUNG Products sold are imported into India and SAMSUNG (KOREA) does not warranty the quality of the goods nor provides any after sales service for the goods. We warranty the quality of the goods and shall....
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....ling in the goods. At the end of the day, the determination of whether the registered proprietor of the trade mark had, or did not have, a legitimate reason to oppose further dealing in the goods, within the meaning of Section 30(4) of the Act, would be largely one of fact. 51. In fact, it appears that the Division Bench, after purporting to identify indicative circumstances in which the registered proprietor of the trademark could have a legitimate reason to oppose further dealings in the goods, did not itself treat these circumstances as watertight. This is apparent from para 73 of the report in which the Division Bench held that the fact that the printers sold by Samsung abroad were different from those of the printers sold in India was irrelevant, so long as the goods, which were placed on the international market by Samsung, were not impaired or their condition changed. 52. In any event, the provisions of Section 30(3) and (4) are, to our mind, sufficiently clear, and are by themselves enough for us to deal with the controversy in issue, without having to navigate as nautical a course as the Division Bench in Kapil Wadhwa chose to chart. E. The impugned judgment I.....
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.... to "impairment" within the meaning of Section 30(4). It was further contended that the respondents could not seek sanctuary under Section 30(3), as the HDDs had not been "lawfully acquired", and were "sold in the market or otherwise dealt with". Even if it were to be presumed that the HDDs had been lawfully acquired, the appellants contended, before the learned Single Judge, that, as their condition had been changed, and they had been impaired before they were put on the market, infringement, within the meaning of Section 30(4), had taken place. 57. On the aspect of infringement, the learned Single Judge has noted the issue arising before him, in para 7 of the impugned judgment, as "of refurbished goods being sold after removal of the original brand, with no reference to the original manufacturers, thereby severing the umbilical cord with the original registered trade mark owner; and whether in this situation an action for infringement or impairment could be considered." 58. The learned Single Judge queried, of learned Counsel for the appellants, as to whether there was any proscription on import of second-hand goods for refurbishing. The appellants relied on para 2.31 of th....
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....istinctive silver plate on the HDDs, which was easily identifiable by the consumer, who would be a technically literate person. In support of the plea of reverse passing off, the appellants relied on the judgment of a Division Bench of this Court in Shree Nath Heritage Liquor Pvt Ltd v. Allied Blenders & Distillers Pvt Ltd 2015 SCC OnLine Del 10164 and on the decision in Smith v. Montoro 648 F. 2d. 602 (1981). In any event, submitted WD before the learned Single Judge, reselling the product under the respondents' brand names amounted to a "false trade description" which was independently actionable under Section 103^4 read with Sections 2(i) and 2(1)(za) of the Act. III. Respondents' contentions before learned Single Judge 63. The respondents contended, per contra, that the HDDs had been lawfully procured by them. They were not the importers of HDDs, but were refurbishers, who had purchased the imported HDDs from the importers under legitimate sale invoices on which GST [Goods and Services Tax] was also paid. The invoices were also placed on record, along with affidavits of the respondents. The appellants had not been able to produce any material to indicate that, in their co....
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....ical analysis, which was a remote possibility. Besides, as the appellants had themselves stated, the purchaser of such a product was prudent, and would know that he was purchasing a refurbished product. 68. Consistent also relied, before the learned Single Judge, on an agreement between Seagate and Nickle Technologies executed in 2018, under which Nickle Technologies has been allowed to import end-of-life HDDs manufactured by Seagate, for refurbishing. It was therefore contended that Seagate could not plead ignorance regarding the fact that their HDDs, which had reached end-of-life stage, were removed, imported into India and sold after refurbishment. Seagate, however, contested the relevance of this submission, stating that the settlement with Nickle Technologies was applicable only inter partes, especially as it formed the basis of a decree under Order XXIII Rule 3 of the CPC. Reliance was placed, for this purpose, on the decision in Pankaj Goel v. Dabur India Ltd 2008 SCC OnLine Del 1744. IV. Observations and findings in the impugned judgment 69. Having thus set out the rival contentions advanced before him, the learned Single Judge proceeds to address the various issue....
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....ted in the matter, that the benefit of Section 30(3) would not be available to the respondents, as they had sold the goods, purchased from the importers, after removing the registered trade marks of the appellants, which would not qualify as putting the goods on the market, within the meaning of Section 30(3). The learned Single Judge holds, therefore, that, "even if exhaustion applies, the defendants cannot get benefit of it under this provision". 77. The learned Single Judge further observes that the said interpretation of Section 30(3) resonated, and was aligned, with Section 30(4), as removal of the original trademark of the registered proprietor would amount to change or impairment of the condition of the HDDs and would, therefore, attract Section 30(4) and, ipso facto, exclude the applicability of Section 30(3). This interpretation was also in line with the law declared by the Division Bench in Kapil Wadhwa. 78. In line with the said decision, the learned Single Judge proceeds, in para 93 of the impugned judgment, to observe that, as there was no illegality in the import of the HDDs, which took place with the original trademark of the appellants in place, the goods coul....
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....utor/retailer in the chain would be liable for any repair or servicing. Of course, if the retailer for purposes of promoting its sale, decides to give an additional warranty over and above the manufacturer's warranty or the OEM's warranty, that will only be a sales incentive. 112. Post-exhaustion of warranty, none of these entities i.e. manufacture/OEM/wholesaler/distributor/retailer have any liability or responsibility of the state of those goods, unless of course, there is a mandate under any law, regulation or policy of managing their disposal. In a situation where such policy or regulation does not exist, or even if it exists but does not impose conditions on the manufacturer, the umbilical cord is cut and the goods are in an untethered space. This is exactly where the principle of exhaustion comes into play; therefore, under Section 30(3)(b), the registered owner/manufacturer has no right to object to any dealing. 113. The only caveat is in Section 30(4) where, if the marks are removed from the original product or it is disfigured or changed in a manner that possibly amounts to "change" or "impairment", and when such goods are sold as goods identified....
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.... were misrepresenting the appellant's products as theirs. (b) Examination by the appellant's engineers, and third party technical experts, using the publicly available Crystal Disk Info tool, revealed the original Serial and Model Numbers, which were easily traceable to the appellant. It was not necessary, for the purposes of passing off, for the appellant's mark to be visible to the consumer at the time of sale of the HDD. (c) If the HDDs malperformed, they would be examined by technical persons, whereupon the appellant's particulars would be readily displayed. This would lead to a presumption that the appellant authorized sale of defective goods. (Presumably, the sequitur that is implied is that the appellant's goodwill and reputation would stand tarnished.) (d) The respondents' acts have resulted in injury to the appellant's goodwill and reputation, and also reduction in its market stake. (e) Even in the modified packing, as per the directions issued in the impugned judgment, the appellants' identity is disclosed only in the outer packing, not on the HDD. Mr. Anand relies, for the purpose of his plea of "reverse passing off", on the j....
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....as refurbished Seagate HDDs. (iii) Re. infringement (i) Import of SEAGATE branded HDDs without the appellant's authorization itself constituted infringement in view of Section 29(6) of the Act, which includes import of goods within the meaning of the term "use". (ii) The only escape from this would be if Section 30(3) applied. However, this provision would not come to the aid of the respondent as the HDDs were not "lawfully acquired" by the respondents, as they had been illegally removed from the computers and other equipment in which they had been installed by the OEMs. The HDDs were not meant for resale. (iii) The mere fact that the HDDs had been purchased by the respondents from importers under invoices which included GST did not make their acquisition, by the respondents, legal. (iv) Section 30(3) was also not available to the respondents as they were claiming to be importing/manufacturing the HDDs, which was a clear misrepresentation. (v) As the importation of the HDDs was itself unlawful, their subsequent purchase by the respondents could not be lawful. (vi) Removal of the appellant's trade marks from the HDDs amo....
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.... (c) There was material impairment in the condition of the HDDs after they were put on the market by the appellant. This was clear from a Technical Report on the HDDs imported by the respondent and obtained from the Customs authorities, by a Staff Engineer at SanDisk India Device Design Centre Pvt Ltd which revealed that (i) the HDDs were old and some were inoperable, and could not be read, (ii) the HDDs were not in their original Electrostatic Discharge (ESD) packaging and (iii) there were stickers on the packaging hiding the date of manufacture. (d) The written statement of the respondent acknowledged the fact that he had the intent to sell the HDDs as new and original products, claiming an "understanding" that they were unused. (e) In this case, the respondent was intending to sell the imported HDDs as it were under the appellant's trade mark. The case was not, therefore, one of refurbishing, and Section 30(3) would not be available. (ii) Other submissions (a) There could be no question of allowing release and sale of changed or impaired goods in the market with "full disclosure". The principle of "full disclosure", ....
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.... (e) The extension, by the respondents, of their own warranties and after sales service to their customers, cannot concern the appellants in any way. (iv) Other submissions (a) The complaints raised by the appellants do not pertain to the realm of intellectual property infringement or passing off. They relate to import policy, enforcement of the terms of the FTP, consumer protection, and the like, which are not subject matter of these proceedings, and could not have been adjudicated by the learned Single Judge as part of the Intellectual Property Division of this Court. No tort, relatable to Section 27 or 29 of the Act, was pointed out by the appellants. (b) The plea that the respondents were resorting to false trade descriptions pertained to Section 103, not Section 29 of the Act. (c) The alternative packing suggested by the learned Single Judge in the concluding paragraph of the impugned judgment would allay all the apprehensions and grievances of the appellants. In support of his submissions, Mr. Mahant relies on paras 19.6.1, 19.9, 35.6, 36.1, 36.3, 40.1, 40.4, 40.6, 46 and 49 of the judgment of the Supreme Court in Pernod Ricard. ....
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.... of misrepresentation; ergo, there could be no passing off either. (ii) Re. infringement (a) Section 30(3) did not create a new specie of infringement. Section 30 was titled "Limits on effect of a registered trade mark". Section 30(3), therefore, merely articulated the principle of international exhaustion. Infringement was required to be independently established under Section 29. Sale of the appellant's HDDs, in their original condition, could never satisfy the ingredients of Section 29. Section 29(6) was not an independent substantive provision. (b) That apart, even assuming Section 30(3) applied, once the HDDs had been sold by the appellant to the OEM, the title in the HDDs passed to the OEM. Further sale by the OEM could not, therefore, be regarded as illicit or illegal. (c) Equally, once the respondent purchased the HDDs against a valid commercial invoice, title in the HDDs passed to the respondent. The appellant could not assert its intellectual property rights to the derogation of the ownership rights of the respondent. (d) There was no material to indicate that the acquisition of the HDDs, by the respondent, was unlawful in the ....
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....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 trade mark 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. 14. The second element that must be established by a plaintiff in a passing off action is misrepresentation by the defendant to the public. The word "misrepresentation" does not mean th....
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....envisages institution of a suit "for passing off arising out of the use by the defendant of any trademark which is identical with or deceptively similar to the plaintiff's trademark". Thus, the suit which may be filed under Section 134 is a suit which is aggrieved by the use, by the defendant, of the trademark which results in the tort of passing off. The defendant must, therefore, be the user of the allegedly injurious trademark. This, too, indicates that the Act does not envisage a suit by a plaintiff alleging that a defendant has passed off the goods of the plaintiff or, for that matter, of anyone else, as his own. 92. Section 135(1) provides for a relief of injunction, apart from damages, delivery up and rendition of profits, "in any suit for infringement or for passing off referred to in section 134". No injunction can, therefore, be granted in a suit which alleges that the defendant is misrepresenting the plaintiff's goods as its own, as that would neither constitute "passing off" within the meaning of Section 27(2), nor does Section 134 envisage filing of a suit in such a case. 93. We, therefore, agree with Mr. Mahant that no right to sue, or obtain an injunction, on t....
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....t, "reverse passing off" envisages exactly the opposite, i.e., clarity in the mind of the consumer, regarding the origin of the goods, despite the defendant seeking to mask it. The likelihood of confusion, for the purposes of passing off, must exist at the initial interest stage, and we see no reason why this principle should not apply to the likelihood of clarity, in the mind of the consumer, in a case of reverse passing off. In other words, for a case of reverse passing off to successfully be pleaded - assuming reverse passing off its actionable as a tort in our jurisprudence - it must be shown that, though the defendant seeks to misrepresent the goods as being his, though they are of the plaintiff, by masking the plaintiff's trademark or by any other means, the consumer is able to identify the goods as those of the plaintiff at the initial interest stage, i.e., when the consumer first comes across the goods. 100. No material, to so indicate, has been cited or produced by the appellants. Though it has been sought to be contended that the shape and colour of the HDDs were unique to the appellants, and that they would serve as sufficient indicia to enlighten the consumer that th....
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....against the respondents on the ground of "passing off" or "reverse passing off". "Passing off" involves not merely an aspect of misrepresentation, but also misappropriation of the goodwill of the plaintiff, resulting in damage to the plaintiff. The three ingredients of passing off, it is trite, are goodwill, misrepresentation and damage [Refer S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd, (2018) 2 SCC 1, Cadila Health Care v. Cadila Pharmaceuticals Ltd, (2001) 5 SCC 73, Brihan Karan Sugar Syndicate]. If these are the ingredients of passing off, we see no reason why they would also not be the ingredients of reverse passing off. 105. Quite clearly, the respondents cannot be said to be misappropriating the goodwill of the appellants in any manner. Nor have the appellants been able to demonstrate that the goodwill which resides in their registered trademarks has suffered any damage, or prejudice as a result of the respondents' acts. We agree with learned Counsel for the respondents that, indeed, the existence of any such damage may be doubtful, as the HDDs in which the respondents deal, and which form subject ma....
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....rved, does not create a new specie of infringement. It merely states that, if goods bearing a registered trademark are lawfully acquired by a person, who thereafter sells or otherwise deals in the said goods, then, if the circumstances envisaged in clause (a) or clause (b) in the said sub-section apply, the act of the person in selling or dealing in the goods would not amount to infringement. By no stretch of imagination, to our mind, can Section 30(3) be said to be carving out a new specie of infringement or setting out circumstances in which the act of a person would amount to infringement. 112. What Section 30(3) says is, therefore, that, if the sale of, or dealing with, the lawfully acquired goods bearing the registered trade mark of another otherwise amounts to infringement, then it would not be infringing if either of the circumstances in clause (a) or (b) applies. The question of applying Section 30(3), therefore, would arise only if the sale of, or otherwise dealing in, the lawfully acquired goods bearing the trademark of another, amounts to infringement within the meaning of Section 29, as Section 29 constitutes a complete and self- contained code with respect to infrin....
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....xed on the goods, and the goods do not lose, or change, their identity as the goods even if the trade mark is changed. Significantly, Section 30(3) does not refer to "sale of the goods as such in the market", but only to "sale of the goods in the market". The interpretation placed by the learned Single Judge would amount to reading, into Section 30(3), the words "as such". This, to our mind, is not permissible. 118. Even after effacing the originally affixed trademarks of the appellants and substituting, in their place, the trademarks of the respondents, the further sale of the goods in the market, with such substituted trademark would, therefore, to our mind, constitute "sale of the goods in the market" for the purposes of Section 30(3) of the Act. 119. We are, however, in entire agreement with the learned Single Judge that it cannot be said that the HDDs were not "lawfully acquired" by the respondents. 120. We agree with Mr. Narula in his submission that if the import of the HDDs was illegal, the subsequent acquisition of the illegally imported HDDs by the respondents, even if under valid commercial invoices, may not constitute "lawful acquisition". However, there is not....
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.... purposes of applicability of the Trade Marks Act, but may constitute a ground for the Customs authorities to proceed against the importer, no view in that regard can be taken till the Customs Notification, governing re-export of the refurbished goods, is there before us. None of the learned Counsel for the appellants has produced the said Notification and, therefore, it is not even open to us to arrive at the finding as to whether the condition of re-export, as contained in para 2.31 was, or was not, breached. 125. In the absence of any such material, we agree with the learned Single Judge that para 2.31 of the FTP does not, in any manner, indicate that the import of the HDDs was illegal. Rather, para 2.31 makes it clear that the HDDs were freely importable. 126. Thus, as (i) no proscription on resale of the HDDs as sold by the appellants to the OEMs, is forthcoming, (ii) there is no material to indicate that the import of the HDDs into India was illegal and (iii) the appellants had purchased the said HDDs from the importers under commercial invoices on which GST was also paid, we endorse the finding, of the learned Single Judge, that the appellants had "lawfully acquired" t....
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....hom the computer or other equipment was sold, and the defect was found to reside in the HDD, the OEM contacted the appellant, who would effect the requisite repair, if the HDD was within warranty period. 132. This submission, even by itself, defeats the appellants' case, insofar as the aspect of severing of the umbilical cord is concerned, as it links the "umbilical cord" to the providing of warranty by the appellants. Applying the extension, by the appellants themselves, of the metaphor employed by the learned Single Judge, the umbilical cord might not have been severed at the point when the HDDs were installed in the equipment by the OEMs, but it unquestionably stood severed when the HDDs reached end-of-life stage, and the appellants' warranty, in respect of the HDDs, was no longer available. After that point, we concur with the learned Single Judge that the appellants did not have any further concern with the HDDs, or what was done with them. 133. There is nothing to indicate that the respondents' acts impaired the condition of the HDDs in any manner. Indeed, no such plea of impairment has even been seriously advanced by the appellants. The appellants' contention is that, ....
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....e refurbished HDDs could not be used in the surveillance equipment, is forthcoming. In any event, this is a consideration which is alien to the controversy before us, as it does not impact either infringement or passing off. 141. The plea that the respondents were indulging in "false trade descriptions" is, again, irrelevant to the issue in controversy. No remedy, under Section 135 of the Act, is available on this ground. As learned Counsel for the appellants themselves acknowledge, resorting to "false trade descriptions" is covered by Section 103 of the Act, which cannot constitute a ground to seek an injunction. 142. The learned Single Judge has proceeded on the concept of "right to repair". Learned Counsel for the appellants submit that the acts of the respondents do not fall within the purview of the concept of "repair". To our mind, this discussion is unnecessary for the purposes of resolution of the controversy in issue. We do not, therefore, propose to enter into this aspect. IV. Re. concluding directions issued by the learned Single Judge 143. Learned Counsel for the appellants sought to contend that the respondents ought to have been altogether injuncted, and t....
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.... that "reverse passing off" was actionable as a tort in India, its ingredients are, nonetheless, absent in the present case as: (a) the "initial interest" test would apply to reverse passing off as well, (b) the ability of the consumer to be able to identify the goods with the original registered trade mark owner must, therefore, be at the time of initial sale of the goods, (c) there was nothing to indicate that, at the time of sale of the refurbished HDDs by the respondents, the consumer would be able to identify them as having been originally manufactured by the appellants, (d) the ability to identify the HDDs as having originated from the appellant using the Crystal Disk Info tool, could not make out a case of "reverse passing off", apart from the fact that the very availability and accessibility of the said tool would be matters requiring evidence and trial, (e) there was no misappropriation, by the respondents, of any goodwill of the appellants, and (f) no material evidence of any damage which had resulted to the appellants, as a result of the acts of the respondents, was available either. (iii) For the same reason....
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.... case, himself imported HDDs, bearing the appellant's trade mark, from Hong Kong and Korea. As in the case of the other appeals decided by this judgment, the HDDs were originally sold by the appellant to OEMs located abroad, from whom, after they had reached end-of-life stage, they were removed from the equipment in which they were installed and sold. Admittedly, at the time of import, the HDDs bore the appellant's registered trademark. 151. The appellant submitted that it had been informed telephonically, by the Deputy Commissioner of Customs, that a consignment of HDDs had been imported at the Kolkata Port, which included HDDs of the appellant. The appellant proceeded to institute, before this Court, the suit from which the present appeal emanates, seeking a decree of permanent injunction restraining the respondent from importing or dealing with any HDDs which had been originally sold by the appellant and which bore the appellant's registered trade marks. 152. The suit was accompanied by IA 14659/2019, under Order XXXIX Rules 1 and 2, seeking interim injunction. An ex-parte ad interim injunction was granted on 21 October 2019, for the vacation of which the Respondent filed ....
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.... in this appeal. K. Analysis 156. The only point of difference between this appeal, and the other appeals which stand decided by this judgment, is that the respondent, in this case, was himself the importer of the end-of-life HDDs sold by the appellant to OEMs abroad and purchased by the respondent. 157. Though Ms. Majumder seeks to contend that the invoice on record, whereunder the respondent had purchased the HDDs in Hong Kong, had not been issued by the appellants' OEM, that factor may not be of substantial significance at this stage. In so far as the purchase of the HDDs abroad is concerned, the findings and observations entered by us hereinabove, with respect to the batch of appeals challenging the order dated 21 May 2024, would equally apply to the present case, as, here, too, the appellant has not been able to contend that there was any restriction on further sale of the HDDs by the OEMs after they had reached end-of-life stage. The purchase of the HDDs abroad, by the respondent has, therefore, to be treated, at least at this stage, to be licit. 158. Unlike the case of the respondents in the batch of appeals covered by the order dated 21 May 2024, however, the re....
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....ix the respondents' mark, would violate Sections 29(2) and (7) of the Act. The submission cannot be accepted, as, in the present case, there was no effacing of the appellants' mark. Besides, Section 29(2) would not apply as there is no likelihood of confusion. 165. But for these differences, there is no substantial distinction, on facts or in law, in the issue and controversy in the above batch of appeals and in the present appeal. L. Conclusion 166. For the reasons already set out earlier in this judgment, therefore, this appeal must also fail, and is accordingly dismissed. 167. There shall be no orders as to costs. 168. Needless to say, as these appeals are directed against orders passed by the learned Single Judge under Order XXXIX of the CPC, observations and findings contained in this judgment shall not inhibit the view which the learned Commercial Court may choose to take on the merits of the disputes between the parties, while adjudicating the substantive suits. A closing remark 169. We believe that commendation should be granted where it is due. We, therefore, record our appreciation for the manner in which Ms. Rashi Bansal, whom we have had the pleasur....
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....rther dealings in the goods in particular, where the condition of the goods, has been changed or impaired after they have been put on the market. 4. 103. Penalty for applying false trade marks, trade descriptions, etc. - Any person who - (a) falsifies any trade mark; or (b) falsely applies to goods or services any trade mark; or (c) makes, disposes of, or has in his possession, any die, block, machine, plate or other instrument for the purpose of falsifying or of being used for falsifying, a trade mark; or (d) applies any false trade description to goods or services; or (e) applies to any goods to which an indication of the country or place in which they were made or produced or the name and address of the manufacturer or person for whom the goods are manufactured is required to be applied under Section 139, a false indication of such country, place, name or address; or (f) tampers with, alters or effaces an indication of origin which has been applied to any goods to which it is required to be applied under Section 139; or (g) causes any of the things above mentioned in this section to be done, shall, unless he....