# RAMDEV FOOD PRODUCTS PVT. LTD v. ARVINDBHAI RAMBHAI PATEL AND ORS

- **Citation:** [2006] Supp. 5 S.C.R. 521
- **Court:** Supreme Court of India
- **Decided:** 2006-08-29
- **Case number:** Civil Appeal Nos. 8815-16 of2003
- **Bench:** S.B. Sinha, P.P. Naolekar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/ramdev-food-products-pvt-ltd-v-arvindbhai-rambhai-patel-and-ors-21685
- **Pages:** 58

## Headnote

B
Trade and Merchandise Marks Act, 1958-Sections 20), 15, 17, 28, 2-9,
30(/)(b) 33, 48 and 49-Trade mark-Infringement of-Business under a
particular trademark run though a Company-Another firm running business C
of retail sale of the products of company-User agreement between the
Company and the firm to use the registered trade mark for seven yearsMemorandum of Understanding entered into by the parties-Firm started
manufacturing its own products under the said trade mark-The use of trade
mark by thefinn questioned as infringement of trade mark by the CompanySuit-Trial Court restrained the firm from using the trade mark by temporary D
injunction except in seven outlets mentioned in Memorandum of
Understanding-High Court upheld finding of trial court except the finding
that printing and publication of the principal display panel was creating
infringement of trademark-On appeal, held: Use of the trade mark of the
Company by the firm for the goods manufactured by it. is infringement of E
trademark-Firm had only a limited right under the MOU-Grant of
trademark is an indicator of exclusivity in trade mark and this right cannot
be transferred-Only a limited right of user can be granted via licence-User
agreement having come to an end on expiry of seven years and such right
not having conveyed in the MOU, Firm could not use the trade mark under
either of them-By reason of interpretation of MOU trade mark cannot be F
infringed especially when the right of user has been relinquished-When
defences in regard to right of user are set up, the onus is on the party who
takes such defence -Standards of Weights and Measures Act-Prevention of
Food Adulteration Act.
Deeds and Documents-Interpretation of-Held: A document must be G
construed having regard to the terms and conditions as well as nature
thereof-It should be read as a whole and to be construed keeping in view
of the existing law.
521
H
522
SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.
A
Interpretation of Statutes-Interpretation of non-obstante clause-Held:
The interpretative process of a non-obstante clause must be kept confined to
the legislative policy.
Interlocutory hyunction-Grant of-In cases of infringement of trade
mark-Held: In such cases injunction would ordinarily follow where it is
B established that the defendant had infringed the trade mark and has not been
able to discharge the burden as regards its defence-When a prima facie case
is made out and balance of convenience is in favour of proprietor of trade
mark only loss of goodwill and reputation to fulfil the condition of irreparable
injury is necessary-In such case delay by itself may not be a ground for
C refusing to issue injunction.
D
Evidence-Onus to prove-In case of infringement of trade markHeld: In such cases, the onus is on the defendant to show that he is entitled
thereto either by reason of acquiescence on the part of the owner of the
registered trade mark or he himself has acquired a right thereto.
Doctrines/Principles: Doctrine of Passing Off and Doctrine of WaiverMeaning of .
Principle of Estoppel and Principle of Acquiscence-Applicability of
E
Jurisdiction-Jurisdiction of appellate Court-To interfere with order
of interlocut01y injunction-Held: Usually appellate court should not interfere
with such order as the same is in exercise of discretionary jurisdiction of trial
court-However, it can substitute its discretion if finds that the discretion has
been exercised arbitrarily, capriciously, perversely or where the court has
ignored settled principles of law regulating grant or refusal of interlocutory
F injunctions.
Words and Phrases: 'Trade mark', 'Passing off and 'Irreparable
ilyury '-Meaning of
A business of manufacturing and selling of spices under the trade name
G of'Ramdev' was being run by three brothers through the appellant-company.
A partnership firm of the respondents being 'Ramdev Masala' was being run
through seven outlets for retail sale of the products of the Company. An user
agreement was enter

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RAMDEV FOOD PRODUCTS PVT. LTD.
A
v.
ARVINDBHAI RAMBHAI PATEL AND ORS.
AUGUST 29, 2006
[S.B. SINHA AND P.P. NAOLEKAR, JJ.]
B
Trade and Merchandise Marks Act, 1958-Sections 20), 15, 17, 28, 2-9,
30(/)(b) 33, 48 and 49-Trade mark-Infringement of-Business under a
particular trademark run though a Company-Another firm running business C
of retail sale of the products of company-User agreement between the
Company and the firm to use the registered trade mark for seven yearsMemorandum of Understanding entered into by the parties-Firm started
manufacturing its own products under the said trade mark-The use of trade
mark by thefinn questioned as infringement of trade mark by the CompanySuit-Trial Court restrained the firm from using the trade mark by temporary D
injunction except in seven outlets mentioned in Memorandum of
Understanding-High Court upheld finding of trial court except the finding
that printing and publication of the principal display panel was creating
infringement of trademark-On appeal, held: Use of the trade mark of the
Company by the firm for the goods manufactured by it. is infringement of E
trademark-Firm had only a limited right under the MOU-Grant of
trademark is an indicator of exclusivity in trade mark and this right cannot
be transferred-Only a limited right of user can be granted via licence-User
agreement having come to an end on expiry of seven years and such right
not having conveyed in the MOU, Firm could not use the trade mark under
either of them-By reason of interpretation of MOU trade mark cannot be F
infringed especially when the right of user has been relinquished-When
defences in regard to right of user are set up, the onus is on the party who
takes such defence -Standards of Weights and Measures Act-Prevention of
Food Adulteration Act.
Deeds and Documents-Interpretation of-Held: A document must be G
construed having regard to the terms and conditions as well as nature
thereof-It should be read as a whole and to be construed keeping in view
of the existing law.
521
H
522
SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.
A
Interpretation of Statutes-Interpretation of non-obstante clause-Held:
The interpretative process of a non-obstante clause must be kept confined to
the legislative policy.
Interlocutory hyunction-Grant of-In cases of infringement of trade
mark-Held: In such cases injunction would ordinarily follow where it is
B established that the defendant had infringed the trade mark and has not been
able to discharge the burden as regards its defence-When a prima facie case
is made out and balance of convenience is in favour of proprietor of trade
mark only loss of goodwill and reputation to fulfil the condition of irreparable
injury is necessary-In such case delay by itself may not be a ground for
C refusing to issue injunction.
D
Evidence-Onus to prove-In case of infringement of trade markHeld: In such cases, the onus is on the defendant to show that he is entitled
thereto either by reason of acquiescence on the part of the owner of the
registered trade mark or he himself has acquired a right thereto.
Doctrines/Principles: Doctrine of Passing Off and Doctrine of WaiverMeaning of .
Principle of Estoppel and Principle of Acquiscence-Applicability of
E
Jurisdiction-Jurisdiction of appellate Court-To interfere with order
of interlocut01y injunction-Held: Usually appellate court should not interfere
with such order as the same is in exercise of discretionary jurisdiction of trial
court-However, it can substitute its discretion if finds that the discretion has
been exercised arbitrarily, capriciously, perversely or where the court has
ignored settled principles of law regulating grant or refusal of interlocutory
F injunctions.
Words and Phrases: 'Trade mark', 'Passing off and 'Irreparable
ilyury '-Meaning of
A business of manufacturing and selling of spices under the trade name
G of'Ramdev' was being run by three brothers through the appellant-company.
A partnership firm of the respondents being 'Ramdev Masala' was being run
through seven outlets for retail sale of the products of the Company. An user
agreement was entered into by and between the appellant-company and the
said firm permitting the firm to use the registered trade mark for seven yeal'li.
H Still another partnership under the name 'Ramdev Exports' was to export the
..
-
RAMDEV FOOD PRODUCTS PVT.LTD. v. ARVINDBHAI RAMBHAI PATEL
523
spices manufactured by the appellant-company. On disputes between the A
partners, a Memorandum of Understanding (MOU) was executed.
Appellant-company filed a suit against the respondents on the premise
that the respondents had been infringing its rights. It also filed an application
for interim injunction seeking to restrain the respondents from using the
trademark 'Ramdev'. Trial Judge restrained the respondents by temporary B
injunction from using registered trademark, logo 'Ramdev' or any other
trademark, which is identical and deceptively similar to the trademark of the
appellant in respect of label and packing material of their goods except in
seven outlets mentioned in MOU till final disposal of the suit. They were held
to be at liberty to run business of spices under the trade name 'Ramdev C
Masala' without using the registered trademark 'Ramdev Masala' except in
seven outlets.
In appeals by both the parties, High Court held that trial court was wrong
in holding that printing and publication of the principal display panel was
creating infringement of trademark as it was deceptively similar and that D
respondents could not be prevented from using the words 'Ramdev' and
'Masala' on their label and packing. Rest of the findings of the trial court
were upheld.
In appeal to this Court, appellant contended that it was impermissible E
for the respondents to use the registered trademark of the appellant either
in the seven outlets or for the goods manufactured by them because by reason
of MOU, they were not permitted to start manufacturing spices under the name
and style of' Ramdev Masala' as they were entitled to carry on retail business
from the seven outlets for the purpose of selling only the end products
manufactured by appellants upon printing the words 'not for resale'.
F
Respondents contended that remedies under Trade and Merchandise
Marks Act, 1958 were not available against ~he respondents, and the appellants
could exercise their right only for the purpose of implementing the MOU
which must be read with deed of retirement; that in the present case principles
for grant of injunction in case of passing off are to be applied and not that of G
trade mark; that the claim of the appellant was barred by Sections 15(1) and
15(2) of 1958 Act; that the stipulations made in MOU do not oblige the
respondent to buy any product from the appellant-company; MOU must be
interpreted in the light of deed of retirement which categorically contained a
stipulation that the continuing partner "have also decided to continue the said H
524
SUPREME COURT REPORTS (2006) SUPP. 5 S.C.R.
A business in the same firm names" and thus if appellant's claim is accepted
the right of the respondent to continue the business under the name and style
of or in the firm name would become inconsistent with the deed of retirement.
B
Allowing the appeals, the Court
HELD: 1.1. In this case the courts below proceeded on a prima facie
misconstruction of documents. They adopted and appiied wrong standards. The
seven outlets were meant to be used for retail sale of the products of the
appellant alone. They, however, failed to notice two significant and important
provisions in the said MOU, viz., (i) the defendants could not carry on business
C in wholesale of the said products; (ii) it was meant to be sold directly to the
consumers and on the productions "not for resale" was required to be printed
on each packet. What, therefore, could be done by the respondents was to sell
the products of the appellant through the said outlets. The respondents,
however, were not restrained from manufacturing spices in their own factory.
They started the same under the brand name of'Swad'. They could even use
D the same retail outlets for the purpose of promoting their own products but
prima facie they could not use the mark registered in the name of the
appellant-Company. [557-A-El
1.2. Once the appellant had acquired goodwill and reputation thereto,
E in the event of any infringement to the said right, the remedies provided for
in Merchandise and Trades Mark Act, 1958 would be available to it. The terms
of the MOU are clear and unambiguous. It was required to be construed, even
if it was obscure to some extent by making attempt to uphold the one, which
would be in consonance with law and not offend the same. (557-E-F(
F
1.3. The respondents in the instant case have adopted a part of the
appellant's registered trade mark as a part of its corporate name. In that view
of the matter, they had a limited right under the MOU and by reason thereof
they could not have been permitted to start manufacturing of spices under
the name and style of'Ramdev Masala'. Even under the common law, licence
has to be interpreted to subsume the law and prevent the mischief which is
G deceptive having regard to the fact that trafficking in trade mark is not
permitted. [558-B-CI
1.4. The grant of a trade mark is an indicator of exclusivity in trade
mark and this right cannot be transferred. Only a limited right of user can
H be granted via licence. Making use of another's trade mark is not only a
violation of business ethics but has also been linked to dishonestly making
RAMDEV FOOD PRODUCTS PVT. LTD. v. ARV!NDBHA! RAMBHA! PATEL
525
use of the goodwill and reputation built up and associated with the mark.
A
(551-D-E; 552-8-Cl
Laxmikant V. Patel v. Chetanbhai Shah and Anr., 120021 3 SCC 65,
relied on.
Gujarat Bottling Co. Ltd. and Ors v. Coca Cola Co. and Ors., (1995] 5 B
sec 545, referred to.
The Modern law of Trade Marks by Christopher Morcom, Butterworths,
(1999), referred to.
1.5. A trade mark is the property of the manufacturer. The purpose of C
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 thereof by a person who is not otherwise
authorised to do so would constitute infringement. Ordinarily under the law
there can only be one mark, one source or one proprietor. The first respondent
herein is a rival trader of the appellant-Company. It did not in law have any D
right to use the said trade mark, save and except by reason of the terms
contained in the MOU or continuous user. When defences in regard to right
of user are set up, the onus would be on the person who has taken the said
plea. Equally a person cannot use a mark which would be deceptively similar
to that of the registered trade mark. Registration of trade marks is envisaged E
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 mind 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 F
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. (552-G-H; 553-A-D]
Suma/ Prasad Jain v. Sheojanam Prasad (Dead) and Ors. and State of
Bihar, 1197311 sec 56; Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer G
Inc., (1999) RPC 117; Baker Hughes limitedv. Hiroo Khushalani, (1998) PTC
(18) 580; Baker Hughes ltd. and Anr. v. Hiroo Khushlani and Anr., (2004]
12 SCC 628 and Mi/met Oftho Industries and Ors. v. Allergan Inc., (2004] 12
sec 624, referred to.
1.6. Traditionally, a trade mark has always been considered a vital and H
526
SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.
A inseparable part of the goodwill of the business. In fact, the sale of a trade
mark without the sale of the goodwill to the same buyer is considered null
and void. However, the trade mark can be assigned with or without the goodwill
of business though subject to certain conditions. 1556-C-DI
Trade Marks, Passing Off and Franchising by V.A. Mohta, pp. 12 and
B 313, referred to.
1.7. It is true that the respondents have been permitted in terms of the
MOU to continue their business in the name of the partnership firm and to
use the label mark, logo, etc. but the said MOU must be construed in the
light of the law operating in the field. For the said purpose, prima facie, the
C deeds of retirement are not required to be looked into. When a right to use a
trade mark is given, such a right can be exercised only in the manner laid
down therein. If in absence of any express licence or agreement to use its
label the respondents use the self-same trade mark, the same would not only
lead to confusion but may also cause deception. Even a common law licence, it
D is well-settled, cannot result in the dilution of the trade mark. 1558-C-E)
1.8. The question which also escaped the attention of the High Court
was that having regard to the non-obstante clause contained in the 1958 Act
ordinarily for any purpose, the trade mark cannot be infringed. If an
infringement of trade mark is established, the onus would be on the defendants
E to show that he is entitled thereto either by reason of acquiescence on the
part of the owner of the registered trade mark or he himself has acquired a
right thereto. The Provisions of the Standards of Weights and Measures Act
or the Prevention of Food Adulteration Act do not confer such right Yet again,
significantly, a pre-emptive right had been conferred in favour of the first
respondent which is itself suggestive of the fact that the first respondent
F admitted and acknowledged the right of the appellant to the said trade mark.
(559-B-D)
1.9. The non-obstante nature of a provision although may be of wide
amplitude, the interpretative process thereof must be kept confined to the
G legislative policy. A non-obstante clause must be given effect to, to the extent
the Parliament intended and not beyond the same. 1559-A-B)
!CIC/ Bank Ltd. v. Sidco leathers ltd. and Ors., 120061 5 SCALE 27,
referred to.
H
1.10. Respondents did not have any right over the trade mark. They in
fact, assigned the same in favour of the appellant-Company. They having
RAMDEV FOOD PRODUCTS PVT.LTD. v. ARVINDBHAI RAMBHAI PA TEL
527
relinquished their right, now cannot fall back on Section 33 of the 1958 Act A
It may be true that there exists a distinction between a suit in a trade mark
action against the whole world and a suit for implementation of division of
assets amongst the members of the family. But, after the MOU was entered
into the parties having separated, ceased to be members of a joint family. What
was, thus, essential for determining the right of the parties would be the terms B
of the MOU. (572-F-H]
1.11. The conduct of the respondents also cannot be appreciated. They
were aware of the rights under the MOU. They had all along been enforcing
the same. Legal defence were available to them under the 1958 Act. (574-8]
P.M Diesels Ltd. v. Patel Field Marshal Agencies and Ors., (2001) PTC
20 Del, referred to.
1.12. By reason of interpretatio'! of MOU, trade mark cannot be
infringed and further when the right of user has been relinquished, the same
c
could not have been claimed by the respondents. (560-E-F)
D
1.13. MOU, for the purpose of these appeals, may be treated to be a family
settlement. Intention of the parties to an instrument must be gathered from
the terms thereof examined in the light of the surrounding circumstances.
The document is to be read as a whole. The deed has also to be construed E
keeping in view the existing law. A docm,nent must be construed having regard
to the terms and conditions as well as the nature thereof.
[547-C-D; 548-8-CJ
Sohan Lal Naraindas v. Laxmidas Raghunath Gadit, [1971] l SCC 276;
Delta International Ltd. v. Shyam Sundar Ganeriwalla, (1999] 4 SCC 545 F
and Union of India v. Mis. Mil/enium Mumbai Broadcast Pvt. Ltd., (2006) 5
SCALE 44, referred to.
1.14. It may be proceeded on the basis that the MOU answers the
principles of family settlement having regard to the fact that the same was
actuated by a desire to resolve the disputes and the courts would not easily G
disturb them. [548-D-E]
S. Shanmugam Pillai and Ors. v. K. Shanmugam Pillai and Ors., [1973]
2 SCC 312; Kale and Ors. v. Deputy Director of Consolidation and Ors.,
[1976] 3 SCC II9 and Hari Shankar Singhania and Ors. v. Gaur Hari H
Singhania and Ors., JT (2006) 4 SC 251, relied on.
528
SUPREME COURT REPORTS (2006] SUPP. 5 S.C.R.
A
1.15. Although at one point of time the appellant-Company had taken a
stand that it being not a party to the MOU, it is not bound by the terms thereof
but the same would not mean that in an action for infringement of trade mark,
when the MOU was put as a shield to its claim, it could not have taken recourse
to proper interpretation thereof for the purpose of determination of the rights
of the parties to use the trade mark in question. It is not a case where the
B courts refused to lean in favour of family arrangement or base its decision
on technical or trivial ground. [548-E-Gl ·
2. If the first respondent has expressly waived his right on the trade
mark registered in the name of the appellant-Company, he cannot claim the
C said right indirectly. What cannot be done directly cannot be done indirectly.
D
Waiver may sometimes resemble a form of election, and sometimes be based
on ordinary principles of estoppel. [560-G-H; 561-El
lndu Shekhar Singh and Ors. v. State of U. P. and Ors., (2006) 5 SCALE
107, referred to.
16 Ha/sbury's Laws (4th edn.) para 1471; 45 Ha/sbury's Laws (4th edn.)
para 1269, referred to.
3.1. Section 15 of the 1958 Act, is not attracted in the instant case. By
reason of the said provision, registration of trade mark in regard to the
E exclusive use is permissible both in respect of the whole trade mark as also
the part thereof separately. Wllere such separate trade mark in regard to a
part of it is applied for, the applicant must satisfy the conditions applying to
and have all the incidents of an independent trade mark. (562-A-Bl
The Registrar of Trade Marks v. Ashok Chandra Rankhit Ltd., (19551 2
F SCR 252, distinguished.
Pinto v. Badman, 8 RPC 181, referred to.
3.2. It cannot be said that only a label has been registered and not the
name 'Ramdev'. Definition of'mark' as contained in Section 2(j) of the 1958
G Act also includes name, signature, etc. [563-B-CI
H
3.3. Section 29of1958 Act provides for the remedies for infringement
of trade mark. What is needed by way of cause of action for filing a suit of
infringement of trade mark is use of a deceptively similar mark which may
not be identical. What would be deceptively similar, as defined in Section 2(d)
RAMO EV FOOD PRODUCTS PVT. LTD. v. AR VlNDBHAI RA MB HAI PATEL
529
of the 1958 Act, would be a mark ifit nearly resembles that other mark as to A
be likely to deceive or cause confusion. It is, therefore, not a case where the
respondents could raise valid defence in terms of Section 29 of the 1958 Act.
(563-C-F(
3.4. The right conferred in terms of Section 28 of the 1958 Act although
is required to be read with Sections 15 and 17 thereof but it is difficult to B
accept that each part of the logo was required to be separately registered.
Section 28 of the 1958 Act confers an exclusive right of using trade mark to
a person who has got the trade mark registered in his name. Such right is,
thus, absolute. (563-D-F)
3.5. It cannot be said that the MOU for the purpose of Section 28 of the C
1958 Act should be read with the partnership deed. The user agreement having
come to an end on the expiry of seven years from the date of execution, the
respondents could no more claim any right thereunder. The right to user has
not been conveyed by reason of the said MOU. The cut off date for determining
the respective rights of the parties would, thus, be the date when MOU came D
into force i.e. on expiry of the user agreement. (563-F-H; 564-A)
3.6. It is not a case where Sections 48 and 49 of the 1958 Act would be
applicable so as to ena!Jle the respondents to raise a defence in terms of Section
30(l)(b) thereof. [564-A-B)
Amteshwar Anand v. Virender Mohan Singh and Ors., (2006) 1 SCC E
148, distinguished.
Re Cadbury Brothers' Application, referred to.
4.1. The doctrine of passing off is a common law remedy whereby a
person is prevented from trying to wrongfully utilise the reputation and · F
goodwill of another by trying to deceive the public through 'passing ofr his
goods. [565-B-C)
'Law of Trade Marks and Trade Names' by Karly Supplement pp. 42
and 43, referred to.
4.2. Although, the defendant may not be using the actual trade mark of
G
the plaintiff, the get up of the defendant's goods may be so much like the
plaintifrs that a clea~ case of passing off could be proved. It is also possible
that the defendant may be using the plaintiffs mark, the get up of the
defendant's goods may be so different from the get up of the plaintifrs goods H
530
SUPREME COURT REPORTS [2006) SUPP. 5 S.C.R.
A and the prices also may be so different that there would be no probability of
deception of the public. However, in an infringement action, an injunction
would be issued if it is prov,ed that the defendant is improperly using the
plaintiffs mark. In an action for infringement where the defendant's trade
mark is identical with the plaintiffs mark, the Court will not enquire whether
the infringement is such as is likely to deceive or cause confusion. The test,
B therefore, is as to likelihood of confusion or deception arising from similarity
of marks is the same both in infringement and passing off actions. (566-A-D)
Parle Products (P) Ltd. v. JP. and Co., Mysore, (1972) I SCC 618;
Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical
C La4oratories, AIR (1965) SC 980 and K.R. Chinna Krishna Chettiar v. Shri
Ambal and Co., Madras and Anr., (1969) 2 SCC 131, relied on.
Ruston and Hornsby Ltd. v. The Zamindara Engineering Co., (1969) 2
SCC 727; Poddar Tyres Ltd. v. Bedrock Sales Corporation Ltd. and Anr., AIR
(1993) Bombay 237 and De Cordova and Ors. v. Vick Chemical Co., (1951)
D 68 RPC 103, referred to.
5.1. Relief by way of interlocutory injunction would be material in a suit
for infringement of trade mark. Balance of convenience, however, would have
a vital role to play. Thus, when a prima facie case is made o·ut and balance of
convenience is in favour of the appellant, it may not be necessary to show
E more than loss of goodwill and rerutation to fulfil the condition of irreparable
injury. In fact, if the first two pre-requisites are fulfilled, in trade mark actions
irreparable loss can be presumed to have taken place. The expression
"irreparable injury" in that sense would have established injury which the
plaintiff is likely to suffer. [574-D; 575-C-EJ
F
G
Mahendra and Mahendra Paper Mills Ltd. v. Mahindra and Mahindra
Ltd., (2002) 2 SCC 147, referred to.
Law of Trade Marks and Trade Names by Karley Thirteenth Edition,
referred to.
5.2. Registration of a trade mark and user thereof per se may lead to
the conclusion that the plaintiff has a primafacie case, however, existence
thereof would also depend upon the determination of the defences raised on
behalf of the respondents. The appellant has raised a triable issue. The same
by itself although may not be sufficient to establish a primafacie case but the
G Court is satisfied that the appellant has been able to establish existence of a
'
RAMDEV FOOD PRODUCTS PVT LTD. v. ARVINDBHAI RAMBHAI PATEL
53 J
legal right in itself and violation of the registered trade mark on the part of A
the respondents. The case of the plaintiff-appellant stands on a better footing
than the defendants-respondents. An injunction can also be granted against
the respondents to use the corporate name. Specific knowledge on the part of
the plaintiff and prejudice suffered by the defendant is also a relevant factor.
1573-A-CI B
SM. Dyechem ltd. v. Cadbw:v (India) ltd., 120001 5 SCC 573, relied
on.
Colgate Palmolive (India) ltd. v. Hindustan lever ltd., 119991 7 SCC
I; American Cyanamid v. Ethicon Ltd., 119751 I All ER 853 and Mis.
Transmission Corporation of A.P. Ltd. v. Mis. lanco Kondapalli Power Pvt. C
Ltd., JT (2005) I 0 SC 542, referred to.
Equitable Remedies by Spray, Fourth Edition, page 433, referred lo.
5.3. Normally the appellate court would be _slow to interfere with the
discretionary jurisdiction of the trial court. The grant of an interlocutory D
injunction is in exercise of discretionary power and hence, the appellate courts
will usually not interfere with it. However, appellate courts will substitute their
discretion if they find that discretion has been exercised arbitrarily,
capriciously, perversely, or where the court has ignored settled principles of
law regulating the grant or refusal of interlocutory injunctions. The appellate
court would normally not be justified in interfering with the exercise of E
discretion under appeal solely on the ground that if it had considered the matter
at the trial stage it would have. come to a contrary conclusion.
(576-G-H; 577-A-C)
Wander Ltd. v. Antox India P. Ltd., (1990) Supp SCC 727; lakshmikant
V. Patel v. Chetan bhai Shah, 12002) 3 SCC 65 and Seema Arshad Zaheer v. F
MC of Greater Mumbai, (2006) 5 SCALE 263, referred to.
5.4. Quality control by a registered trade mark holder vis-a-vis the one
produced by an unregistered one is one of the factors which is required to be
taken into consideration for the purpose of passing an order of injunction.
G
1557-F-Gl
5.5. Delay in some cases may defeat equity but the chronology of events
in the present case does not suggest that the appellants consciously allowed
the respondents to use the trade mark. 1570-C-D)
5.6. Acquiescence is a facefof delay. The principle of acquiescence would H
532
SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.
A 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. 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
B consequent acts it would be unjust in all the circumstances to grant the specific
relief. [570-D-E; 571-A-B)
Mis. Power Control Appliances and Ors. v. Sumeet Machines Pvt. ltd.,
[1994) 2 sec 448, relied on.
C
"Treatise on the Law and Practice of Injunction", by Kerr, Sixth Edition,
pages 360-361, referred to.
5. 7. In an infrL :ement of trade mark, delay by itself may not be a ground
for refusing to issue injunction. The time gap between the issuance of the
notice and filing of an application for grant of injunction was not a voluntary
D act on the part of the appellant herein. It had to wait for the outcome of various
proceedings pending before different courts. The respondents having
themselves taking recourse to judicial proceedings cannot now be permitted
to set up the defence of acquiescence on the part of the appellant. Indisputably,
in a case of infringement of trade mark, injunction would ordinarily follow
where it is established that the defendant had infringed the trade mark and
E had not been able to discharge its burden as regard the defence taken by it.
(570-F-G; 571-E-H)
Midas Hygiene Industries (P) Ltd. v. Sudhir Bhatia and Ors., (2004) 3
sec 90, relied on.
F
Pioneer Electronic Corporation and Anr. v. Registrar of Trade Marks,
(1978) RPC 716, referred to.
6. The appellant shall, as and when demands are made, supply spices
produced by it for retail sale thereof to seven outlets belonging to respondents
on usual terms, and in respect of such articles on the labels/pouches, on the
G reverse thereof, the following shall be mentioned in the minimum permissible
size in terms of the provisions of Weights and Measures Act and Prevention
of Food Adulteration Act: "This product is manufactured and marketed by
Mis. Ramdev Masala (Arvindbhai Group) (Or Mis. Ramdev Exports Arvindbhai
Group) having no relationship whatsoever with Ramdev Food Products Pvt.
H Ltd." [578-B-DJ
c::
,.
RAMDEVFOOD PRODUCTS PVT.LTD. v. ARVINDBHAI RAMBHAI PATEL [S.B. SINHA,J.J 533
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 8815-16 of2003. A
From the Judgment and Order dated 8.5.2003 of the High Court of
Gujarat at Ahmedabad, in Appeal From Order Nos. 113 and 130/2003.
WITH
C.A. No. 8817 of2003.
Ashok H. Desai, C.A. Sundaram, Mihir Joshi, Hazefa Ahmadi, Devang
S. Nanavati, Lalit Chauhan, Saurin Mehta, Nokul Diwan, Anshuman Mohapatra,
Shiva Santanam and P.H. Parekh (for Mis. P.H. Parekh & Co.) for the Appellant.
F.S. Nariman, Dr. Abhishek M. Singhvi, Mihir Thakore, Mahesh Agarwal,
Unmesh Shukla, Janak Shah, Nitin Mehta, Manu Krishnan and E.C. Agrawala
for the Respondents.
The Judgment of the Court delivered by
S.B.SINHA, J. Interpretation of the provisions of the Trade and
Merchandise Marks Act, 1958 (for short "the 1958 Act") arises for consideration
in these appeals arising out of a judgment and order dated 08.05.2003 passed
by the High Court of Gujarat at Ahmedabad.
FACTS
The appellant is a company incorporated under the Companies Act,
1956. The other parties to these appeals were/are its Directors.
B
c
D
E
In the year 1965, one Rambhai Patel started a business of grinding and
selling spices under the name and style of 'Ramdev'. He had three sons and F
two daughters, Arvindbhai, Hasmukhbhai and Pravinbhai were his sons. A ·
partnership firm was constituted in the year 1975. It applied for registration
of the trademark 'Ramdev', which was granted on 03.01.1986 being Trademark
No.44 7700. Another partnership deed was executed in supersession of the
earlier partnership deed wherein new partners were inducted. On 06.01.1989, G
the appellant company was incorporated whereby and whereunder the pattern
of shareholding amongst the three brothers was : Arvindbhai Group (40%);
Hasmukhbhai Group (30%); and Pravinbhai Group (30%). The registered
trademark was assigned by 'Ramdev Masala Stores' in favour of the appellant
by a deed dated 20.05.1990. However, by the said deed the goodwill was not
assigned. The trademark together with the goodwill was assigned in favour H
534
SUPREME COURT REPORTS (2006) SUPP. 5 S.C.R.
A of the appellant company by another deed of assignment dated 20.05.1992.
A 'user' agreement was also entered into by the same parties permitting the
firm 'M/s. Ramdev Masala Stores' to use the said trademark subject to the
terms and conditions stipulated therein. Another partnership firm being
'Ramdev Masala' was started on 01.04.1991 for carrying on the trade of
B grinding and trading of masalas. A user agreement was also entered into by
and between the appellant company and the said firm permitting the latter to
use the registered trade mark for seven years i.e. from 01.04.1991 to 31.03.1998
in terms whereof it was stipulated :
· "3. AND WHEREAS the User is a firm registered under the Indian
C
Partnership Act and wishes to use in the city of Ahmedabad except
the area ofNaroda City of Ahmedabad and district Mehsana, Gujarat
State (India) registered proprietors aforesaid registered Trade Mark
(hereinafter referred to as "the said Trade Mark") in respect of the
said goods."User restricted to the cities of Ahmedabad and Mehsana;
D
4(C) That the User will continue to use the said mark only so long as
he manufactures his goods in accordance with the terms and
specifications devised by the Registered Proprietor.
4(E) That within the terms of this agreement and thereafter the User
will not acquire any right to the said mark hy any means whatsoever
E
except in accordance with law.
4(G) That the User covenants not to use the said Trade Mark in the
advertisement, journal label and/ or other documents in such a manner
that the said Trade Mark may in any way be diluted in respect of
distinctiveness of validity if necessary and indication either usually,.
F
phonetically may be given to the purchasing public to the extent that
the User uses the said mark by way of permitted use only."
Indisputably, the firm 'Ramdev Masala Stores' was dissolved on
04.11.1991. Yet again a new partnership firm came into being under the name
and style of 'Ramdev Exports'. The said partnership firm was constituted for
G the purpose of export of spices manufactured by the appellant company.
It is not in dispute that the business of manufacturing and selling of
spices under the trade name of 'Ramdev' was being run by the three brothers
through the appellant company.
H
Another partnership firm being 'Ramdev Masala' was being run through
...
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RAMDEV FOOD PRODUCTS PVT. LTD. r. ARVINDBHAI RAMBHAI PATEL [S.B. SINHA,J.] 535
seven outlets for retail sale of the products of the Company.
It is also not in dispute that both the firms 'Ramdev Masala' and
'Ramdev Exports' had distinct and separate existence. Their areas of operation
were also different. The respective roles assigned to each of the partnership
A.
firm had clearly been specified in their respective partnership deeds. Whereas
Mis. Ramdev Masala was allowed to manufacture and trade in spices, the B
business of Mis. Ramdev Exports was limited to export of the spices
manufactured by the appellant company. Yet again, the partnership deed of
Ramdev Masala was amended on 01.04.1995; in terms whereof the business
of the said firm was confined only to trading in spices manufactured by the
appellant company. In other words, the respective businesses under the C
partnership deeds of the said firms are stated to be as under :
a.
Type of business of Ramdev Masala under the first partnership
deed was grinding and selling of spices.
b.
Type of business of Mis. Ramdev Masala under the second
partnership deed was trading in spices.
D
c.
The business of Mis. Ramdev Exports was exporting the goods
manufactured by the appellant company.
DISPUTES
Disputes and differences having arisen between the members of the
family and in particular between the three brothers, the same was settled by
their well-wishers, pursuant whereto and in furtherance whereof a
Memorandum of Understanding (MOU) was executed by and between the
parties, to which we would advert to a little later.
LEGAL PROCEEDINGS
. On the premise that the respondents had been infringing its rights,
· ·trade
7name and logo, the appellant company filed a suit in the City Civil Court,
j\hmedabad, which was numbered as CS No.828 of 2000, inter a/ia, for the
E
F
f~llowing reliefs :
G
"(A) The defendants by themselves, their servants, agents, partners
and all persons claiming through or under them be restrained by a
perpetual order of this Hon'ble Court from, in any manner, using the
trade mark 'RAMDEV' in their label, packing materials, advertising
H
A
B
c
D
E
F
536
SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.
materials, business materials etc., in respect of goods which are covered
under registration of the plaintiffs mark and/or any mark which may
be identical and/or deceptively similar to the plaintiffs registered
trade mark and thereby restrain them from infringing the plaintiffs
registered trade mark bearing No. 44 7700 and other marks bearing
No.531084, 531085, 545253, 545253, 545255, 545257 and 545258."
An application for injunction was also filed wherein the following interim
prayers were made :
"(A) The defendants by themselves, their servants, agents, partners
and all persons claiming through or under them be restrained by an
order of temporary injunction of this Hon 'ble Court from, in any
manner, using the trademark 'RAMDEV' in their label, packing materials,
advertising materials, business materials etc. in respect of goods which
are covered under registration of the plaintiffs mark and/or any mark
which may be identical and/or deceptively similar to the plaintiffs
registered trade mark and thereby restrain them from infringing the
plaintiffs registered trade mark bearing No.447700 and other marks
bearing No.531084, 531085, 545253, 545255. 545257 and 545258, till the
hearing and final disposal of the suit.
(B) The defendants by themselves, their servants, agents, partners
and all persons claiming through or under them be restrained by an
order of temporary injunction of this Hon 'ble Court from using in
relation to any spices, masala bearing the name 'RAMDEV' as
produced with separate list or any label or packing material or
advertising material containing the trade mark 'RAMDEV' and/or any
mark which is identical and/or mark containing word 'RAMDEV' either
on label or in trading style or trading name, so as to pass off the
defendants goods and/or business as that of the plaintiff, till the
hearing and final disposal of the suit."
An application was also filed for appointment of a Court Commissioner.
G
DEFENCES OF THE RESPONDENTS
H
The principal defences raised by the respondents in the said suit are
as under:
(i)
The appellant has no exclusive statutory right to use 'Ramdev'
RA MD EV FOOD PRODUCTS PVT. LTD. 1: ARVJNDBHA! RA MB HAI PATEL [S. B S!NHA,J] 53 7
apart from the label as a whole. (Sections 15 and 17 issue)
A
(ii)
The first respondent has a right to use the mark as concurrent
user. (Section 29 issue)
(iii) That the use complained of is protected, as bona fide user and
furthermore the appellant is not entitled to the reliefs sought for
as the same were barred under the principles of estoppel, B
acquiescence, etc.
ORDER ON THE APPLICATION FOR INJUNCTION
By a judgment and order dated 17 .03 .2000, the learned Trial Judge
opined that the plaintiff company was the owner of the trademark. It was C
further held that the defendants had started manufacturing and marketing the
same business which is deceptively similar to the trademark of the plaintiff
which created confusion in the mind of public. However, the defe1;1dants were
given liberty to manufacture spices in their factory and sell the same in seven
outlets under the trademark 'Ramdev Masala'.
On an interpretation of the said MOU dated 30.05.1998, it was, inter
alia, held :
D
" ... Therefore, if there is agreement between the parties that the
defendant No. I should purchase spices from the plaintiff for the E
purpose of retail-sale in 7 outlets, it must have been mentioned in the ··
MOU. No such condition is mentioned. If that be so, it cannot be
presumed that the defendants should purchase spices from the plaint: ff
for the purpose of retail-sale in 7 outlets. In case of written-agreement
between the parties, it should be taken as it is. It should be read as
it is. No additional terms and conditions or agreement can be presumed. F
Therefore, in absence of any specific condition that the defendants
should sell spices by using trade-mark "Ramdev" in 7 outlets by
purchasing the goods from the plaintiff is not believable.
13. This condition also does not seem to be possible .....
14 ..... The defendants have arranged for the packing material bearing
regd. trade-mark "Ramdev" and used the same for the purpose of retail
business. These facts clearly suggest that there was no restriction on
the defendants to purchase spices from the plaintiff for the purpose
of retail business. in 7 outlets. On the contrary, the defendant was at
G
H
538
A
SUPREME COURT REPORTS [2006) SUPP. 5 S.C.R.
liberty to manufacture in their factory and sell the same in 7 outlets
for the purpose of retail business.
15. Relevant portion of MOU is reproduced earlier. Accordingly, the
defendants are permitted to use the trade-mark or logo "Ramdev'' for
the purpose of retail-sale in 7 outlets.