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The Gujarat Ginning and Manufacturing Company, Limited Vs. the Swadeshi Mills Company Limited - Court Judgment

LegalCrystal Citation
SubjectIntellectual Property Rights
Decided On
Case NumberFirst Appeal No. 316 of 1936
Reported inAIR1939Bom118; (1939)41BOMLR182
AppellantThe Gujarat Ginning and Manufacturing Company, Limited
RespondentThe Swadeshi Mills Company Limited
.....acquiring reputation as mark of goods-whether imitation of such number infringement of trade-mark-mark used on similar goods but of inferior and different class-whether such user constitutes infringement-burden of proof-substantial damages, when awarded.;if a mark or symbol, which may include numerals, comes by use to be recognised in the trade as the mark of the goods of a particular person, no other trader is entitled to stamp it on his goods of a similar description, although these are of a different size and of an inferior quality.;johnston v. orr ewing (1882) 7 app. cas. 219, leather cloth co. v. american leather cloth co. (1865) 11 h.l.c. 523, 538, and hall v. barrows (1864) 33 l.j. ch. 204, 207, 208, referred to.;in cases of infringement of trade-mark, it is not necessary to..........goods, including dhoties of various kinds. on these goods they stamp or affix their respective trade-marks, the plaintiffs' being a lotus flower and other marks and the defendants' a coloured picture of yeshoda, the mother of krishna, milking a cow. below the trade-marks proper they both stamp numbers in large black figures. plaintiffs call their number their cipher. it indicates goods of a particular description. thus the number 24410 means dhoties 44' wide by ten yards long of a certain quality. their dhoties of this size and quality are said to have a great sale in northern india and they allege that this number has come to be associated with goods of their manufacture in cawnpore, delhi and other places, they having made use of it since 1910. it is alleged in the plaint:the said.....

Broomfield, J.

1. The plaintiffs-respondents are the Swadeshi Mills Company, Bombay, one of the Tata group of mills. The defendants-appellants are the Gujarat Ginning and Manufacturing Company, Ahmedabad. Both firms manufacture cotton goods, including dhoties of various kinds. On these goods they stamp or affix their respective trade-marks, the plaintiffs' being a lotus flower and other marks and the defendants' a coloured picture of Yeshoda, the mother of Krishna, milking a cow. Below the trade-marks proper they both stamp numbers in large black figures. Plaintiffs call their number their cipher. It indicates goods of a particular description. Thus the number 24410 means dhoties 44' wide by ten yards long of a certain quality. Their dhoties of this size and quality are said to have a great sale in Northern India and they allege that this number has come to be associated with goods of their manufacture in Cawnpore, Delhi and other places, they having made use of it since 1910. It is alleged in the plaint:

The said dhoties have acquired a great reputation in the Indian markets and are known and required for and1 ordered under the said No. 24410 which has become the plaintiffs' trade-mark and denotes the plaintiffs' goods bearing the said number. The said number has become identified with the plaintiffs' said goods and any dhoties numbered with the number 24410 would be taken by purchasers unless unusually careful as being the well-known 24410 dhoties of the plaintiffs and would be likely to be passed off by unscrupulous persons as being the goods manufactured by the plaintiffs.

It is further alleged that-

in of about the month of May, 1931, the plaintiffs came to know that the defendants were using the said No. 24410 on dhoties not manufactured by the plaintiffs exposing the said imitation dhoties for sale in Cawnpore where the plaintiffs' said dhoties have been sold and are well-known with the evident intention as the plaintiffs say of trading on the reputation enjoyed by the plaintiffs' dhoties and of passing off the said imitation dhoties as the well-known dhoties of the plaintiffs and misleading purchasers into accepting the defendants' said imitation dhoties.

The plaintiffs therefore prayed that the defendants should be restrained by injunction from stamping or getting stamped or otherwise putting on dhoties not of the plaintiffs' manufacture the No. 24410 with or without the letter A and from selling or putting on the market directly or indirectly any such dhoties not of the plaintiffs' manufacture with the said No. 24410; also that the defendants should be ordered1 to deliver up all such dhoties in their possession and to render full and detailed accounts of the purchase and sale by them of all such imitation dhoties.

2. In the written statement defendants put the) plaintiffs to proof of the fact that the No. 24410 has become associated with the plaintiffs' goods. They contended that plaintiffs' goods are not known by the number apart from the trade-mark and that the number is not particularly associated with the plaintiffs' goods. They contended further that the defendants' goods are known by the trade-mark and not by the number and that owing to the differences in the trade-mark, the get up, quality and description of the goods there is no likelihood of any deception or of the defendants' goods being passed off for the plaintiffs'.

3. The defendants use the No. A/24410 on dhoties of 36' width and 10 yards length, these dhoties being admittedly of inferior quality and lower price. The user of the number by the defendants is said to date from the year 1926. Their case is that they previously, i.e. in the year 1925, used the No. 34410 for dhoties 38' wide, 44410 for dhoties 40' and 54410 for dhoties 42' wide. In their case therefore the number is not an intelligible cipher but entirely arbitrary and the figures '44' at any rate are meaningless.

4. The trial Court framed issues:

(1) Whether the plaintiffs prove that they have acquired a trade-mark in No. 24410 as alleged?

(2) Whether they prove that the defendants have infringed the said trade-mark?

(3) Do the plaintiffs prove that they have suffered any loss on account of the said infringement?

(4) Are the plaintiffs entitled to any damages? If yes, what amount?

The finding on the first two issues was in favour of the plaintiffs, and in order to assess the damages an account has been ordered to be taken by Commissioners to ascertain the loss sustained by the plaintiffs in the manner suggested in Juggi Lal Kamalapat v. Swadeshi Mills Co., Ltd. I.L.R. (1928) All. 182 : 31 Bom. L.R. 285 P.C.

5. The first argument put forward on behalf of the defendants in this appeal is that the No. 24410 is not part of the plaintiffs' trade-mark. Trade-mark means a mark used for denoting the goods or the manufacture or merchandise' of a particular person. It is so defined in Section 478 of the Indian Penal Code and that is the ordinary definition. It is argued that the number in this case shows the quality and particulars of the goods but not the source of manufacture and therefore it is not properly speaking a trade-mark. It has also been argued that if the plaintiffs are entitled to the exclusive use of this number, it can only be in connection with dhoties of this particular quality and size and the defendants therefore are entitled to use it on their dhoties which are admittedly of inferior quality and smaller width. It has been pointed out that the number was not claimed as forming part of the trade-mark in Swadeshi Mills Co., Limited v. Juggi Lal Kamlapat Cotton Mill Co., Limited I.L.R. (1926) All 92, the case in which the plaintiffs established their right to the lotus flower with its concomitant marks as their trade-mark.

6. But the law is clear that any mark or symbol, whatever the original object of it may have been, may come by use to be recognised in the trade as the mark of the goods of a particular person, and if so no other trader has a right to stamp it on his goods of a similar description : Leather Cloth Co. v. American Leather Cloth Co. (1865) 11 H.L.C. 523. The principle is well settled that if a man by a long course of trading has acquired a reputation for his goods bearing a particular mark or symbol, which may include numerals and may even include the get-up, no other trader is entitled to imitate the mark or the get-up so as to deceive the trade or the public and secure for his own goods the good-will and reputation which belong to the goods of his rival. In my opinion no particular importance is to be attached to the suggested distinction between trade-mark and number.

7. As to the second point, it is true that there can be no right to the exclusive ownership of any symbol or mark universally and in the abstract. Thus in Hall v. Barrows (1864) 33 L.J. Ch. 204 it was held that a manufacturer of hardware who had established his right to use a particular trade-mark on his iron goods was not entitled to prevent a wooden manufacturer using a similar trade-mark on his goods. But clearly in such a case there is no question of one party cutting into the trade of the other. It is quite a different matter where both deal in dhoties which are the same commodity, although they may differ in quality and size. There is in this case little or no evidence on the question of the importance of a few inches more or less width in the case of dhoties. It is, possible perhaps that the plaintiffs' dhoties 24410 and the defendants' dhoties A/24410 differ so much in size that the presence of the same number on them would not easily lead anyone, even an ignorant villager, to accept one instead of the other. But that is not the only point and not I think the main point. The plaintiffs' case cannot fairly be limited to the allegation that the defendants' 36' dhoties may be passed off as the plaintiffs' 44' dhoties. If the number has become a symbol of goods of the plaintiffs' manufacture, it may easily happen that goods even of a different and inferior class may benefit from the good-will and reputation of the plaintiffs. In that connection reference may be made to the case of Johnston v. On Ewing (1882) 7 App. Cas. 219, cited in Swadeshi Mills Co., Limited v. Juggi Lal Kamlapat Cotton Mills Co., Limited I.L.R. (1926) All. 92.

8. The phrase used by one of defendants' witnesses : 'A man who wants a cigarette won't take a bidi,' which may be said to sum-up the defendants' case in this respect, is not at all conclusive of the matter. Those who commonly use cigarettes may want bidis sometimes, either for themselves or for others, and if the bidi manufacturer induces people to think that his must be good bidis because they are of the same manufacture as the cigarettes, he is infringing the cigarette manufacturer's trade-mark. I shall have something more to say later on on the question of the difference in size.

9. Another point to be borne in mind is that traders who set out to steal the trade of a rival usually do so by degrees and stages. If the plaintiffs failed to establish their claim to the exclusive use of this number on their dhoties, there is nothing to prevent the defendants, or anybody else for that matter, using it on dhoties of the same size as the plaintiffs' and less obviously inferior in quality. In cases of this kind it is not necessary to prove actual deception, only that the act of the defendants is calculated to deceive ; and where there is deliberate imitation of a trade-mark, the burden of proof is on the imitator : Swadeshi Mills Co., Limited v. Juggi Lal Kamlapat Cotton Mills Co., Limited I.L.R. (1926) All. 92.

10. The plaintiffs have examined on commission fifteen witnesses connected with the piece-goods trade in Delhi and Cawnpore and one from Lucknow : of these four are commission agents, nine piece-goods merchants, two selling agents of the plaintiffs or the Tata Mills and one a broker. Their evidence establishes (and indeed the fact is not seriously disputed) that from 1910 the plaintiffs have been selling their dhoties bearing this No. 24410 in large quantities, that these dhoties have acquired a good reputation and that the number has become associated with these particular goods in the trade. Whether the number alone is always sufficient to identify the goods in all branches of the trade is not so clear. Nor I think is it a matter of the first importance. For those who deal solely or mainly in the goods of the Tata group of mills it probably is. In the orders they receive and send for these dhoties and in the accounts they keep in their books the number is used and nothing more. Those who deal with other mills besides Tata's naturally show the name of the mill as well as the number in, their books. Only one of the plaintiffs' witnesses, exhibit 86, handles defendants' goods as well as Tata's, and in his books he does not put the number only but Tata Mill 24410 and 24410 (Cow Brand), meaning the defendants'. But he agrees with the other witnesses that as plaintiffs' 24410 is an old brand people generally mean that when they ask for that number. The evidence satisfies me that the number is the dominant designation of this line of goods, and indeed it must be so, for neither trade-mark nor the name of the mill which appear on all goods alike would identify this particular line of dhoties.

11. Defendants' witness, exhibit 96, deals in Tata's goods as well as defendants'. But his order book seems to show that he does not deal much in the plaintiffs' dhoties, his market for dhoties being according to him among the poorer people. He says that the number is not sufficient to identify the goods except in the case of a few numbers which are used by a single mill only. According to him No. 24410 is not now one of these. But it is common ground that from 1910 to 1926 at any rate plaintiffs' dhoties were the only ones with this number in the market.

12. Defendants' witnesses exhibits 97 and 98 have both dealt with the defendants' mill and some half dozen other mills all using the No. 24410 for 36' dhoties. They do not deal in the plaintiffs' goods. In their case of course the number alone does not identify the goods and the name of the mill has to be used as well. But this evidence is not really inconsistent with the plaintiffs' case. The use of the number by these other mills is admittedly recent. The statement by some of defendants' witnesses that defendants' goods bearing this number had been in the market for eight or nine years before they gave evidence is manifestly untrue. The defendants have admitted that before October, 1926, they issued no dhoties bearing this number. In the documentary evidence consisting of orders and accounts the earliest date is in 1929. Moreover there is no evidence that the trade, in these other 24410 dhoties is very considerable. The defendants themselves say that their own trade in them has been negligible. It is not even suggested that any of these other dhoties have become publicly associated with the number or indeed that they have acquired any reputation at all. It is impossible to say therefore that the number has become publici juris and lost its association with the plaintiffs' goods in the general market.

13. The plaintiffs' claim in this respect is strongly supported by the fact that as long ago as 1918 they successfully vindicated their right to the exclusive use of this number on dhoties in a suit against the Ahmedabad Ginning and Manufacturing Company. Their claim was admitted in that suit and the admission was extensively advertised in the newspapers. It is also strongly supported, I think, by the evidence, such as it is, which the defendants have chosen to give as to the circumstances in which they began to use this number on their dhoties. Their story is that some merchants or brokers who were clients of theirs suggested to them in 1925 that they should put the number 44410 on their dhoties. So they did so on dhoties of 40' wide, and six months later they put No. 34410 on dhoties 38' wide. They were then asked for dhoties of lesser width with the No. 24410 and issued these from October, 1926, as they say. The evidence on the point does not strike one as being full and straightforward. They have not proved from their books, as they presumably could have done, that they used these numbers as long ago as 1925 and 1926. They have not produced any letters from brokers or merchants and have not explained in any way why they were asked and consented to use a five figure number, from their point of view an entirely arbitrary number, the last four figures of which tallied with the number which the plaintiffs' mill had been using for many years. It is true that the Nos. 44410 and 34410 were innocuous or at any rate were not objected to. But one cannot but feel a very strong suspicion that this was merely the thin end of the wedge, leading up to the No. 24410, and that this number was adopted by the defendants and very probably by some other mills also for the simple reason that the plaintiffs' dhoties bearing that number had acquired a considerable reputation.

14. It is contended, however, that plaintiffs' witnesses are mostly wholesale merchants and that though it may be conceded that in their minds the number is associated with goods of the plaintiffs' manufacture, it does not follow that the same is the case with the retail purchaser. Plaintiffs' case is that it is he who is liable to be deceived and not the wholesaler. Now it is true that the plaintiffs have not produced as much evidence as might have been expected as to the conditions in which retail selling takes place. Several of their witnesses who assert that the villager who goes into a shop to buy a dhoti or pair of dhoties inquires for the goods by a number are not really, it would seem, in a position to know. At first sight it might appear somewhat improbable that the illiterate customer would ask for his dhoti by mentioning a five figure number, whether in English or in the vernacular, and more likely that he would say a Nagpur dhoti or mention the name of the mill or simply say that he wanted a dhoti like he had before or the best to be had for Rs. 2 or whatever the price might be.

15. On the other hand two at least of plaintiffs' witnesses have first-hand experience of the retail trade. One is exhibit 101, who has been employed by the plaintiffs' selling agents both at Cawnpore and Delhi, and the other exhibit 103 who is connected with a big retail shop called the Swadeshi Bhandar at Lucknow. Moreover I think it is common sense that if a certain number has been the dominant designation of a particular line of goods; in the trade for a long period of years, that number must have acquired some influence and value in the retail market also. In the course of twenty years even a long number may easily become familiar, especially when it is stamped on the garment in large figures and presumably stays there till it comes out in the wash. Neither the word Nagpuri nor the name of the mill would suffice to identity these particular dhoties, for plaintiffs make dhoties in many qualities and sizes. I think it is impossible to accept the assertion of defendants' witnesses that the number of the dhoties has no importance in the retail trade. They allege indeed that it has no importance in the trade at all. But this is inconsistent not only with the evidence as a whole but with the defendants' conduct in appropriating the number borne by goods of established reputation. It may be mentioned that the same argument based on the fact that the evidence was mostly of wholesale merchants was put forward in Madhavji &c.; Co. v. Central India &c.; Co. (1916) 18 Bom. L.R. 206 and was held to be without force. That was a case in which the Empress Mill, Bombay, another of the Tata group of mills, established their exclusive right to the use of the No. 2051/10 on their black twill goods. Almost all the defences which have been put forward in this case were put forward on that occasion also and the suit was decreed in spite of them. I see no reason to doubt that the association of the No. 24410 with the dhoties of the plaintiffs extends to the retail trade as well as to the wholesale.

16. The next argument, which is the one on which the learned advocate for the appellants has laid most stress, is that there is no likelihood of the retail purchaser or anyone else being deceived because of the difference in quality and especially the difference in size. I have already referred to this argument and suggested that it is fallacious. The evidence leaves us rather in the dark on this question of the size of the dhoties. The width of dhoties that a man wears depends partly on his height, partly on the fashion of wearing it. We do not know whether a man who normally wears a 44' dhoti will ever wear one of 36'. Supposing that he will, the possibility of deception is obvious. He may easily be induced to purchase a 36' dhoti which is substantially cheaper if he infers from the number on it that it is of the same manufacture as the one he is accustomed to and therefore good. Suppose on the other hand that he will not wear such a dhoti himself, still his relations and his friends will and he may buy for them or they may buy relying on his recommendation. Again we do not know whether the plaintiffs make dhoties of 36' or not. Assume that they do. It is easy to suppose that the defendants' dhoties might be passed off for them. The difference in price would offset the apparent inferiority in quality if by reason of the number both were1 taken to be of the same manufacture. The plaintiffs' dhoties of 36' would no doubt bear a different number, but the evidence does not suggest, and it seems unlikely, that village people who had become accustomed to the No. 24410 would realize that it only applied to a single size. Assume again that the plaintiffs do not make any dhoties of this size and the case is clearer still. There is obviously some demand for dhoties of this size and those who wanted them and were familiar with the number would naturally assume that the defendants' dhoties bearing that number were of the same well-known make.

17. As held in Reddaway v. Banham [1896] A.C. 199 and in the other cases cited in Madhavji &c.; Co. v. Central India &c.; Co. it is sufficient if the plaintiffs show that the defendants have put into the hands of an unscrupulous retailer the means of deceiving the ultimate purchasers. In my opinion the evidence does establish this.

18. There is also the other point which I have already mentioned. It may well be that putting the No. 24410 on the defendants' 36' dhoties is only the first step in their campaign to capture the plaintiffs' trade. If the same number were put on dhoties of the same size as plaintiffs, it cannot be disputed that the damage to plaintiffs' trade might be extremely serious. If there is any risk of damage as things are-and I am satisfied that there is-, the plaintiffs are entitled to protection at once and need not wait until the position gets worse. I think the trial Court was right in granting the injunctions prayed for.

19. The position is different as regards the plaintiffs' claim for an account. An injunction may be granted and nominal damages awarded merely on proof of infringement of a trade-mark and reasonable probability of damage to the plaintiffs' trade. But substantial damages can only be awarded on proof of actual damage. The plaintiffs have asked in the plaint for an account of the defendants' profits. It has ben conceded in this case, however, that in view of the decision of the Privy Council in Juggi Lal Kamalapat v. Swadeshi Mills Co., Ltd. I.L.R. (1928) All. 182 : S.C.285 P.C. the criterion is whether there has been any falling off in the plaintiffs' own sales of these dhoties by reason of the defendants having pirated their number. But no serious attempt has been made to show, by evidence that so far there has been any falling off at all. It is not even alleged by any witness, except exhibit 92, whose testimony is obviously worthless since he has never handled either the plaintiffs' goods or the defendants.' The record does not support the suggestion of the learned Counsel for the respondents that the evidence on the issue of damages was reserved. It is possible and on the whole I think rather probable that the action taken by the plaintiffs was in time to prevent their trade being materially affected. But, however that may be, they are not entitled to an account for the purpose of assessing substantial damages because their evidence does not lay the foundation for that form of relief. They are entitled to nominal damages only which we assess at Rs. 100.

20. In the result the decree of the trial Court will be confirmed so far as the injunctions are concerned but the order directing an account will be set aside and instead the plaintiffs will be awarded Rs. 100 nominal damages.

21. As regards costs, there can be no doubt that the substantial relief in a case of this kind is the injunction which the plaintiffs have succeeded in getting. In substance then they have succeeded in their suit and we think that they are entitled to their costs in both Courts from the defendants except that they must pay the Court-fees on the claim for Rs. 5,000.

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