High Court Of Kerala – M/S Mariyas Soaps And Chemicals Vs. M/S Wipro Enterprises Limited[1]

Summary

The Division Bench of Kerala High Court on 5^th July 2023 set aside the prohibitory injunction of the Ernakulam District court which restrained the Appellants from using its registered Trademark ‘CHANDRA’ for being similar to Respondent’s registered Trademark ‘CHANDRIKA’.

Respondents are the registered proprietors of the mark “Chandrika” and have been using the same for their products since 1940. On the other hand, appellants are selling their products under their registered mark “Chandra”. It was argued that appellants do not have any authority to use such a deceptively similar Trade name as that would infringe the Trade Mark of the respondents. Even after serving the cease-and-desist notice by the respondents; appellants continued to market their products and in such circumstances; respondents filed the suit as well as an application for prohibitory injunction i.e., I.A. No. 2 of 2022.

The court observed that the respondents were marketing their product ayurvedic soap under the registered mark “Chandrika”; that they had obtained in respect of their products, cartons, and labels; at the same time; the appellants have been marketing washing soap and detergents under the trade name “Chandra”.  The contention that has been used by the respondents has been that the products marketed by the appellants have close similarities with the products of the respondents and that they are of the same class, and hence the appellants cannot be allowed to infringe their trademark.

Issues Raised

The issues that were raised in this court are as follows:

Whether respondents are entitled to claim relief based on the alleged passing off?

Whether the appellants marketing their products as “Chandra” result in damage to the goodwill of the respondents?

Judgement

The Hon’ble High Court held that the party of a suit who is a proprietor of a registered trademark cannot sue the opposite party if it also has the trademark which is registered.[2]

Now, the Hon’ble High Court while answering whether the Respondent can claim relief for Passing-off, observed that, in order to establish the Passing-off by the Respondent, the three main elements of passing-off need to be established.

Goodwill of the mark- The Hon’ble Court held that indeed, the Respondents’ mark has goodwill in the market as they have been using it since 1940 and have had a trademark registration since 1976.

Whether marketing the mark of the Appellant would constitute the misrepresentation of the Respondent’s Mark- The court took note of the findings of the District Court where it was held that the colour combination, label, writing style and design are deceptively similar. The High court affirmed the findings of the District Court and held that the products of the Appellants would misrepresent the products of the Respondent.

Damage to the goodwill of the mark of the Respondent- the High Court observed that though both parties have been marketing their soaps in Class 3, the purposes of those products are completely different. Based on the market share of the Respondents, no economic loss or damage was sustained. In view of that, the third element to attract a passing off action is not established by the respondents. Hence, the High Court decided to set aside the order of the district court and the appeal was allowed.

Analysis

The Court before arriving on the aforementioned judgment relied on cases such as S. Syed Mohideen vs. P. Sulochana Bai in this case; the Apex Court considered the scope of action by one registrant against another registrant of a Trade Mark. The Court further stated that it is a matter of common sense that the plaintiff cannot say that its registered trademark has been infringed while the defendant has also been enjoying a registered trademark; and also enjoys the right to use their registered trademark as per Section 28 (1) of the Trademark Act 1999.

Further, an injunction was granted by the trial court as well as the High Court on the basis that trademark of the appellant; even though it was registered; was causing deception in the minds of the public at large; and that the appellant was trying to encash upon it, exploit it and ride upon the goodwill of the respondent. After a careful comparison of Sections 28 (3) and 27 (2); the Apex court upheld the right of a person to take action against passing off even when the other party’s trademark is registered as well.

The Apex Court held in the case of Cadila Healthcare Limited v. Cadila Pharmaceuticals Ltd.[3] that while in an action for infringement, the plaintiff must prove that the action of the defendant is likely to deceive; on the other hand; where there is a similarity between the plaintiffs and the defendants’ mark that they are so close either visually, phonetically or otherwise; and the court reaches the conclusion that there has been an imitation; no further evidence is required in such a case to establish that the plaintiff’s rights are being violated.

Hence; it could be made out that the registration of a trademark gives exclusive rights to the use of the trademark subject to the provisions of the Trade Marks Act 1999. The rights in passing off emanate from common law and are independent of the rights that are conferred by the Act. The action of passing off in its essence is an action of deceit wherein the common law rule is that no person must be entitled to carry on their business on the pretext that the said business is that of another.

Based on this test, it was very well held in the present case that the appellant is using a deceptively similar mark and it was a case of passing off although separating the passing off from harm to goodwill and damage; it was found that there was no harm done to the goodwill of the appellant based on market share data and the injunction was set aside.

[1] M/S Mariyas Soaps and Chemicals vs. M/S Wipro Enterprises Limited; F.A.O. NO. 48 OF 2023.

[2] S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683.

[3] Cadila Healthcare Limited v. Cadila Pharmaceuticals Ltd. [(2001) 5 SCC 73].