1997 PLP 2124 (MLD)

The plaintiff No. l is not one whose trading activities are confined in India alone. It claims to have a worldwide trade. It did have registration of the trade mark in India. Non‑renewal of the trade mark is assigned by the plaintiff to causes like‑import restrictions and foreign trade policy of the government of India. One of the causes assigned is a communication gap between the plaintiff No. l and its trade mark attorney. The production of the goods was not stopped. May be in a limited section of the society but the goods were being marketed and they were being sent to India in spite of non‑registration of the trade mark here in India. They were being exhibited and continuously advertised in such circumstances that an inference as to abandonment of the trade mark by the plaintiff No. l cannot be drawn. In 1986, the defendant, initiated proceedings for registration of Whirlpool trade mark so as to own the same. Opposition was offered by the plaintiff No.

1. The matter has been contested throughout till the date of decision by the Assistant Registrar of Trade Mark. Having lost there at the plaintiff have preferred an appeal which is pending. There is no question of acquiescence by the plaintiffs. For the present the defendants have not adduced any documentary evidence of their having marketed their washing machines enabling a finding on the length of time and the extent to which they have marketed if at all their such products. The Assistant Registrar of the trade mark has also not recorded any finding in favour of the defendants as to the actual user by them of the trade mark Whirlpool. The findings of the Assistant Registrar quoted hereinabove show his having formed an opinion that the proposed use in future could entitle the defendants for registration. Having lost before the Assistant Registrar the plaintiffs have preferred an appeal and also filed this suit. The plaintiffs cannot justifiably be accused of culpable delay, acquiescence and laches or abandonment so as to disentitle them from the relief of injunction. The learned counsel for the plaintiffs have rightly contended that in the absence of grant of injunction they are likely to suffer irreparable injury. It is submitted that the washing machines which are being manufactured by the defendants are. not of the same engineering standards and do not give the .same quality of performance as the plaintiffs' machines do and so the marketing of the washing machines with 'Whirlpool' trade mark is sure to damage irreparably the reputation and goodwill of the plaintiffs. It has rightly been pointed out that the defendants are not going to suffer any injury inasmuch as even if they have manufactured any washing machines, they have only to remove and replace the small metallic strip bearing the offensive trade mark/name which includes Whirlpool. The plaintiffs do not have any objection to the defendants manufacturing and offering for sale washing machines in the trade mark/name of Ushashriram or Lexus or any other name at the choice of the defendants so long as the trade mark/name adopted by the defendants is not the same or similar or deceptively similar to that of the plaintiffs. This Court has formed an opinion that the registration of the Whirlpool as trade mark of the defendants was of no consequence in passing off action. This order too would not have any effect on the registration proceedings, sub judice in appeal which shall be decided on its own merits." The Division Bench while dismissing the defendants appeal, stated thus:‑‑

"From the aforesaid facts including the extensive advertisements of the goods of the first respondent and its trade mark 'Whirlpool' and the legal position adumbrated hitherto we are prima facie of the opinion that the trade mark 'Whirlpool' has acquired reputation and goodwill in this country and the same has become associated in the minds of the public or potential buyers with the goods of the first respondent. Even advertisement of trade mark without existence of goods in the market is also to be considered as use of the trade mark. It is also not necessary however, that the association of the plaintiff's mark with his goods should be known all over the country or to every person in the area where it is known best. (See Faulder & Co. Ltd. v. O. & G. Rushton (1903) 20 RPC 477). Besides the facts prima facie demonstrate that the first respondent was prior user of the trade mark Whirlpool' as it was using the same since 1941, while the appellants themselves claim the adoption thereof from 1986. Thus, we see no reason to differ with the finding of the learned Single Judge that the first respondent acquired transborder reputation in respect of the trade mark 'Whirlpool' and has a right to protect the invasion thereof. The concept and principle on which passing off action is grounded is that is man is not to sell his own goods under the pretence that they are the goods of another man. A trader needs protection of his right of prior user of a trade mark as the benefit of the name and reputation earned by him cannot be taken advantage of by another trader by copying the mark and getting it registered before he could get the same registered is his favour. We see no reason why a registered owner of a trade mark should be allowed to deceive purchasers into the belief that they are getting the goods of another while they would be buying the goods of the former which they never intended to do. In an action for passing off it, should not matter whether misrepresentation or deception has proceeded from a registered or an unregistered user of a trade mark. He cannot resent his own goods as the good‑ of some body else. Applying this principle & the reasons already stated we have prima facie come to the conclusion that the appellants have acquired reputation & goodwill in respect of its goods bearing trade mark 'Whirlpool' in this country. Even, though the appellants have no connection with the respondents, they are using the mark Whirlpool' for their products. Prima facie it appears to us that buyers are likely to be deceived or confused as to the origin and source of the goods. They will believe that the product is manufactured by the respondents, an impression not founded in truth. The limitation will pass off as genuine. No one can be permitted to trade by deceiving or misleading the purchasers or to unauthorisedly divert to itself the reputation and goodwill of others. Under section 27(2) an action for passing off against registered user of trade mark is maintainable at the instance of a prior user of the same, similar or identical mark. Since such a remedy is available against the registered user of a trade mark, an interim injunction restraining him to use the mark can also be granted to make the remedy effective. We also do not agree with the submission of learned counsel for the appellants that the respondents are guilty of culpable delay acquiescence and laches which disentitle the respondents from claiming the relief of injunction. There is no plausible and convincing explanation by the appellants as to how they came to adopt the mark 'Whirlpool'. In absence of any satisfactory explanation by the appellants, the adoption of the mark by them cannot prima facie be regarded as honest and plea of delay and laches would be of no avail to them. As regards acquiescence; there is nothing to show that there has been a tacit or express assent by the respondents to the appellant's using the mark. As regards the submission of learned counsel for the appellants that the respondents had abandoned the trade mark 'Whirlpool' and therefore, they cannot maintain the action of passing off, is not well founded. As already seen, the respondents had been using the trade mark 'Whirlpool' worldwide and there is no reason to assume that the same was abandoned. Mere fact that the registration was not renewed by them in India after 1977, is no ground to hold that the respondents had abandoned the trade mark. 'Having regard to the above discussion, we see no reason to interfere with the discretionary order passed by the learned Single Judge dated October 31, 1994 granting the restraint order .' An attempt was made at the hearing before us by the appellants to place reliance on some additional material produced at this stage. It is sufficient to observe that this appeal has to be decided on the basis of material produced in the trial Court. We may add that the trial Court itself has referred to order, 39, Rule 4, C.P.C. granting liberty to move an application thereunder, if there be any significant additional material available to invoke the jurisdiction' of the trial Court for the discharge or variation of the order of temporary injunction. We may add that the additional material produced at this stage is also not sufficient to swing the balance in the other direction. Shri Kapil Sibal, learned counsel for the appellants conceded fairly at the outset that a passing off action is maintainable in law even against a registered owner of the trade mark and, therefore, the fact that the defendants have obtain a registration (subject to the outcome of a pending appeal) is by itself not sufficient to render the suit not maintainable. However, he qualified this statement by adding that the existing registration in favour of the defendants is a significant fact in favour of the defendants even at the interlocutory stage in the suit for deciding whether a temporary injunction should be granted against the defendants. The other factors on which Shri Sibal relied are:-- (i) Plaintiffs filed an opposition to the defendants application for registration before the Registrar which was rejected, even though their appeal is pending; (ii) A separate application dated 4‑8‑1993 for rectification under, sections 46 and 56 of the Act has been filed by the plaintiffs, which too is pending in the High Court; (iii) Plaintiffs had registration of trade mark 'Whirlpool' in India from 1956 ‑ 57 which was allowed to lapse in 1977; (iv) A fresh application for registration of the trade mark has been made by the plaintiffs only in 1988, which is pending; and (v) Filing of the suit thereafter on 4‑8‑1994, in this background is delayed. Shri Sibal also submitted that the defendants are manufacturing and selling washing machines which cost less than 1/3rd the price of the plaintiffs' washing machine; and the full description given on the plate affixed to the defendants' washing machine leaves no room for any confusion in the mind of the buyer that the defendants' machine is goods associated with plaintiffs. Shri Sibal submitted that an overall view of all these factors negatives the existence of a prima facie case for grant of a temporary injunction in favour of the plaintiff. Shri Sibal also submitted that the washing machines marketed in India by the plaintiffs are sold by the joint venture with TVS and not by the plaintiff No. l‑‑ Whirlpool Corporation itself. In reply, Shri Soli, J. Sorabjee, learned counsel for the respondents, contended that the defendants were earlier doing their business in the name of Ushashriram, Usha‑Lexus and there is no explanation by them for this switch over which reveals their intent to derive unfair advantage of the established name of 'Whirlpool' associated with plaintiff No. l because of prior user, which is sufficient to support a passing off action Shri Sorabjee also submitted that actual sales by the plaintiffs of washing machines in the name of 'Whirlpool' in India is not necessary while in the case of the defendants, actual user of that name by them and not the fact of registration of that mark is material. Shri Sorabjee relied on the finding of the trial Court that actual sales of washing machines using the mark 'Whirlpool' by the defendants prior to 1994 is not shown at this stage; and grant of registration to defendants is only on the ground of proposed and not actual user, Shri Sorabjee also referred to the affidavit of the defendants filed in the High Court disclosing their actual sales and existing stock which reveals that the business was more in names other than 'Whirlpool'. Shri Sorabjee finally submitted that an appeal Court is not to interfere ordinarily with the exercise of discretion by the trial Court in granting a temporary injunction and this is more so when the discretion exercised by the trial Court has been affirmed in the first appeal. The findings of the learned Single Judge, as affirmed on appeal by the Division Bench, are:‑‑‑ (i) Long prior user of the name of Whirlpool' by plaintiff No, and a transborder reputation and goodwill extending to India to the use of that name; (ii) Prior registration of that name even in India from 1956‑57 to 1977 against the earliest claim by the defendants from 1986 (the date of application for registration); (iii) Grant of registration to the defendants on .12‑8‑1992, only on the ground of proposed user instead of actual user, which was opposed by the plaintiffs and is subject to the outcome in the pending appeal; (iv) No reliable evidence of the defendants having marketed their washing machines for any considerable length of time prior to grant of the interlocutory injunction; (v) Irreparable injury to the plaintiffs' reputation and goodwill with whom the name of 'Whirlpool' is associated because of the washing machines of the defendants not being of the same standard and quality of performance as the plaintiffs' machines; (vi) On the other hand, the injury to the defendants by grant of the injunction inasmuch as the defendants' washing machines can be sold under the other names used earlier, with the removal and replacement only of the small metallic strip which bears the offensive trade mark/name which includes 'Whirlpool'; and (vii) There is no justification to accuse the plaintiffs of culpable delay, acquiescence and laches or abandonment so as to disentitle them from the relief of injunction. It has also been held that there is no plausible explanation offered by the defendants for recently 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 by the plaintiff No. 1, whose name is associated with the mark.' Whirlpool'. The plaintiffs' conduct in opposing the defendants' application for registration as soon as it was notified and persisting in the opposition by filing an appeal against the Registrar's order and then an application for rectification of the entry in the register on grant of the certificate and also filing the suit without delay is referred by the trial Court as sufficient to suggest that there was no abandonment of the mark, acquiescence or laches by the plaintiffs. In our opinion, the above concurrent findings, on which the grant of interlocutory injunction in favour of the plaintiffs is based is, to say the least, a reasonable conclusion on the relevant material available at this stage. It is not for this Court at the stage of second appeal to reassess the material and reach an independent 'conclusion thereon for the first time and it has only to be seen whether the conclusion reached by the trial Court was reasonably possible on the material. Moreover, even on a reassessment, it appears to us that the conclusion reached by the trial Court in favour of the plaintiffs is the one more probable and reasonable on this material. The question now is whether the exercise of discretion by the trial Court in favour of the plaintiffs to grant the interlocutory injunction is in accordance with the settled principles of law regulating grant of interlocutory injunctions or not? We think it is so. Injunction is a relief in equity and is based on equitable principles. On the above concurrent findings, the weight of equity at this stage is in favour of the plaintiffs and against the defendants. It has also to be borne in mind that a mark in the form of word which is not a derivative of the product, points to the source of the product. The mark/name 'Whirlpool' is associated for long, much prior to the defendants' application in 1986 with the Whirlpool Corporation plaintiff No.

1. In view of the prior user of the mark by plaintiff No. l and its transborder reputation extending to India, the trade mark 'Whirlpool' give an indication of the origin of the goods as emanating from or relating to the Whirepool Corporation plaintiff No. 1. the High court has recorded its satisfaction that use of the 'Whirlpool' mark by the defendants indicates prima facie an intention to pass‑off defendants' washing machines as those of plaintiffs' or at least the likelihood of the buyers being confused or misled into that belief. The fact that the cost of defendants washing machine is 1/3rd of the cost of the plaintiffs' washing machine as stated by Shri Sibal, itself supports the plaintiffs' plea that the defendants' washing machines are not of the same engineering standard and are inferior in quality to the washing machines of the plaintiffs'. In addition, it has been rightly held that the grant of interlocutory injunction would cause to significant injury to the defendants who can sell their washing machines merely by removing the small metallic strip bearing the offensive trade mark/name which includes 'Whirlpool'. On the other hand, refusal of the interlocutory injunction would cause irreparable injury to the plaintiffs' reputation and goodwill since the trade mark/name 'Whirlpool' is associated for long because of prior user and even otherwise with the plaintiff No.l‑ Whirlpool Corporation these factors which have been relied on for grant of the interlocutory injunction by the trial Court indicate that the exercise of discretion was in accordance with the settled of principles of law relating to the grant of interlocutory injunctions in a passing‑off action. The affirmance of the trial Court's order by the Division Bench on an appeal reinforces the trial Court's view. Applying the settled rule indicating the scope of interference in an appeal against exercise of discretion by the trial Court to grant art interlocutory injunction, we find no ground to take a different view or to interfere,' with the grant of the injunction. On the above conclusion reached on the facts of this case, it is unnecessary to refer to the several decisions cited at the Bar to indicate the settled principles of law regulating grant or refusal of interlocutory injunctions and the scope for grant of such an injunction in a passing‑off action even against the proprietor of a registered trade mark. None of those decisions lays down that in a passing‑off action based on the right in common law distinct from the statutory right based on a registered mark, an injunction cannot be granted even against an owner of the trade mark in an appropriate case. It is for this reason, Shri Kapil Sibal fairly conceded this position at the outset and relied on the fact of registration in favour of the defendants only for the limited purpose indicated earlier. The surviving controversy at this stage was confined only to the legality and propriety of an interlocutory injunction granted on the facts of this case. It cannot be seriously disputed that on the findings recorded by the trial Court and affirmed on appeal by the, Division Bench which appear to us as reasonable conclusion on the relevant material, grant of an interlocutor, injunction is the appropriate order to make and the proper exercise of discretion by the trial Court. The decision of this Court in Wander Ltd. and another v. Antox India P. Ltd. (supra) is alone sufficient to support this view. We may add that the trial Court has taken care to protect the defendants' interest at the interlocutory stage during the trial of the suit in the language used for grant of the interlocutory injunction reserving liberty to apply for its discharge or variation if additional material or subsequent events justify such a course. This appeal must, therefore, fail. Consequently, the appeal is dismissed with costs Rs.10,

000. A. A./1‑I/(SC) Appeal dismissed.