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E.M.i. Records Ltd. and anr. Vs. H.M.V. House and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtOrissa High Court
Decided On
Case NumberMisc. Appeal No. 42 of 1982
Judge
Reported inAIR1984Ori91
ActsCode of Civil Procedure (CPC) , 1908 - Order 39, Rules 1 and 2
AppellantE.M.i. Records Ltd. and anr.
RespondentH.M.V. House and anr.
Appellant AdvocateP.N. Sewak, ;T. Hafiz, ;Y. Das and M.S. Haque, Advs.
Respondent AdvocateL. Rath and ;U.K. Mishra, Advs.
DispositionAppeal dismissed
Cases Referred(Arakhito Sahu v. Aba
Excerpt:
.....aware of the reputation enjoyed by the plaintiffs in respect of their goods under their registered trade mark 'h. house' in a blatant attempt to gain unfair advantage from the reputation and good will associated with the plaintiffs in respect of their own goods under the trade mark of 'h. house' stands for 'happy musical varieties house' and although the defendants agreed to write the words 'happy musical varieties house' under the heading 'h. house' (full form-happy musical varieties house) since december, 1976 and defendant no. house',but this mark is only an abbreviation of 'happy musical varieties house'.the defendants have denied that there has been any infringement or pass-ing off in respect of the goods handled by them. 989-90): we have already pointed out that the suit by the..........marks act, 1958 (hereinafter referred to as 'the act') makes provision for two classes of trade mark actions. sub-sec. (1) makes it clear that no person shall be entitled to institute any proceeding to prevent the infringement of an unregistered trade mark or to recover damages therefor. this prohibition does not, however, affect actions for passing off provided for in sub-section (2). in order to appreciate the distinction between the two kinds of actions, reference may be made to the following two decisions of the supreme court.in air 1965 sc 980, durga dutt sharma v. navaratna pharmaceutical laboratories, it was held (at pp. 989-90):''.............we have already pointed out that the suit by the respondent complained both of an invasion of a statutory right under section 21 in.....
Judgment:

B.N. Misra, J.

1. This appeal is directed against the order dt. 17-12-81 passed by the learned District Judge, Sundargarh dismissing the appellants' petition (or interim injunction in Misc. Case No. 31 of 1980 arising out of Title Suit No. 3 of 1980 pending in the court of the District Judge, Sundargarh.

2. The plaintiffs are the appellants. Plaintiff No. 1 is a company registered in the United Kingdom and Monisha Lahari is the attorney of plaintiff No. 1. Plaintiff No. 2 is an Indian Company and the said Monisha Lahari is also the attorney of plaintiff No. 2. Their suit against the respondents, who are defendants in the court below, is for permanent injunction and damages in a combined action of infringement and passing off. The plaintiffs' case may be briefly noted. They are reputed manufacturers of inter alia apparatus, instruments and devices for recording, reproduction, transmission or receiption of sound, television apparatus, gramophone needles and parts and accessories thereof and their business and the goods manufactured by them enjoy excellent reputation all over the world including India. Plaintiff No. 1 is the registered proprietor in India of the trade mark--'H.M.V.' since 1943 in respect of the goods described in para 4 of the plaint and para 3 of the injunction petition. Plaintiff No. 2 is the licensed user in India of the aforesaid trade mark. The trade mark 'H.M.V.' along with a logo is the house mark of plaintiff No. 2 and appears on all their goods, letterheads, packing materials, invoices, bills, pamphlets, literature and advertisements and it is recognised by the members of the trade and public and associated with plaintiff No. 2 and their licensors, plaintiff No. 1. Around April, 1979, the plaintiffs came to know that the defendants were operating under the trading style of 'H.M.V. House' and were using the said trading style in relation to their goods and on their hoardings, letterheads, trade circulars and business stationeries. Although the defendants are aware of the reputation enjoyed by the plaintiffs in respect of their goods under their registered trade mark 'H.M.V.', they have deliberately chosen the trading style of 'H.M.V. House' in a blatant attempt to gain unfair advantage from the reputation and good will associated with the plaintiffs in respect of their own goods under the trade mark of 'H.M.V.' over the past many years. This action of the defendants is an infringement of the statutory rights of the plaintiffs for the registered trade mark 'H.M.V.' Further, by operating under the deceptive trading style of 'H.M.V. House', the defendants are passing off goods not of the plaintiffs' manufacture as the goods of the plaintiffs. The plaintiffs had entered into correspondence with the defendants in the matter of infringement and passing off. The defendants took the stand that their mark 'H.M.V. House' stands for 'Happy Musical Varieties House' and although the defendants agreed to write the words 'Happy Musical Varieties House' under the heading 'H.M.V. House', they were not agreeable to change their trading style. After further correspondence, the plaintiffs finally filed the present suit in the court of the District Judge, Sundargarh on 1-11-1980. Along with the plaint, the plaintiffs also filed a petition for interim injunction against the defendants pending disposal of the suit. In addition to the petition for injunction, the attorney of the plaintiffs has filed an affidavit in support of the allegations contained in the plaint and the petition for injunction

3. The defendants in their show-cause have denied the allegations of the plaintiffs. According to them, the plaintiffs have no cause of action to file the suit and are also not entitled to the relief of interim injunction. The defendants' case is that defendant No. 1 is a firm duly registered by the Sub-Registrar of Assurance, Calcutta as a proprietary concern at Rourkela under the name and style of 'M/s. H.M.V. House' (Full form-Happy Musical Varieties House) since December, 1976 and defendant No. 2 is the sole proprietor of the said firm. The defendants are the authorised dealers of M/s. Cosmic India, Keltron, Meltron and Sony India from whom they receive goods purely for the purpose of storing and selling. The defendant-firm is duly registered as such with the sales tax authorities and other commercial authorities under the State Government. The defendant-firm has earned its reputation on its own by its business acumen and it has not resorted to any fraudulent activities as alleged by the plaintiffs. The defendants are neither the manufacturers nor wholesale distributors of any materials and goods. They are retailers, totally dependant on day to day sales. The defendants do use the trading style 'H.M.V. House', but this mark is only an abbreviation of 'Happy Musical Varieties House'. The defendants have denied that there has been any infringement or pass-Ing off in respect of the goods handled by them. The trade of the defendants is totally different from that of the plaintiffs and therefore the plaintiffs are not entitled to any relief. Accordingly, the defendants have prayed that the prayer for injunction should be refused to the plaintiffs.

4. The learned District Judge considered the matter and came to the decision that the plaintiffs were not entitled to the relief of interim injunction pending disposal of the suit. Plaintiffs' application for injunction was accordingly dismissed. This order of the learned District Judge is under challenge in this appeal.

5. As already noted, the plaintiffs' suit for permanent injunction and damages is based on a combined action for infringement and passing off. Plaintiff No. 1 is the registered proprietor of the trade mark 'H.M.V.' since 1943 and plaintiff No. 2 is the registered user in India of the aforesaid trade mark. Section 27 of the Trade and Merchandise Marks Act, 1958 (hereinafter referred to as 'the Act') makes provision for two classes of trade mark actions. Sub-sec. (1) makes it clear that no person shall be entitled to institute any proceeding to prevent the infringement of an unregistered trade mark or to recover damages therefor. This prohibition does not, however, affect actions for passing off provided for in Sub-section (2). In order to appreciate the distinction between the two kinds of actions, reference may be made to the following two decisions of the Supreme Court.

In AIR 1965 SC 980, Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, it was held (at pp. 989-90):

''.............We have already pointed out that the suit by the respondent complained both of an invasion of a statutory right under Section 21 in respect of a registered trade mark and also of a passing off by the use of the same mark. The finding in favour of the appellant to which the learned counsel drew our attention was based upon dissimilarity of the packing in which the goods of the two parties were vended, the difference in the physical appearance of the two packets by reason, of the variation in their colour and other features and their general get-up together with the circumstance that the name and address of the manufactory of the appellant was prominently displayed on his packets and these features were all set out for negativing the respondents' claim that the appellant had passed off his goods as those of the respondent. These matters which are of the essence of the cause of action for relief on the ground of passing off play but a limited role in an action for infringement of a registered trade mark by the registered proprietor who has a statutory right to that mark and who has a statutory remedy in the event of the use by another of that mark or a colourable imitation thereof. While an action for passing off is a Common Law remedy being in substance an action for deceit, that is, a passing off by a person of his own goods as those of another, that is not the gist of an action for infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of 'the exclusive right to the use of the trade mark in relation to those goods' (Vide Section 21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for infringement. No doubt, where the evidence in respect of passing off consists merely of the colourable use of a registered trade mark, the essential features of both the actions might coincide in the sense that what would be a colourable imitation of a trade mark in a passing off action would also be such in an action for infringement of the same trade mark. But there the correspondence between the two ceases. In an action for infringement, the plaintiff must, no doubt, make out that the use of the defendant's mark is likely to deceive, but where the similarity between the plaintiff's and the defendant's mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is an imitation, no further evidence is required, to establish that the plaintiffs rights are violated, Expressed in another way, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark would be immaterial, whereas in the case of passing off, the defendant may escape liability if he can show that the added matter is sufficient to distinguish his goods from those of the plaintiff.

When once the use by the defendant of the mark which is claimed to infringe the plaintiff's mark is shown to be 'in the course of trade', the question whether there has been an infringement is to be decided by comparison of the two marks. Where the two marks are identical no further questions arise; for then the infringement is made out. When the two marks are not identical, the plaintiff would have to establish that the mark used by the defendant so nearly resembles the plaintiffs registered trade mark as is likely to deceive or cause confusion and in relation to goods in respect of which it is registered (Vide Section 21). A point has sometimes been raised as to whether the words 'or cause confusion' introduce any element which is not already covered by the words 'likely to deceive' and it has sometimes been answered by saying that it is merely an extension of the earlier test and does not add very materially to the concept indicated by the earlier words 'likely to deceive'. But this apart, as the question arises in an action for infringement the onus would be on the plaintiff to establish that the trade mark used by the defendant in the course of trade in the goods in respect of which his mark is registered, is deceptively similar. This has necessarily to be ascertained by a comparison of the two marks--the degree of resemblance which is necessary to exist to cause deception not being capable of definition by laying down objective standards. The persons who would be deceived are, of course, the purchasers of the goods and it is the likelihood of their being deceived that is the subject of consideration. The resemblance may be phonetic, visual or in the basic idea represented by the plaintiff's mark. The purpose of the comparison is for determining whether the essential features of the plaintiff's trade mark are to be found in that used by the defendant. The iden^ tification of the essential features of the mark is in essence a question of fact and depends on the judgment of the Court based on the evidence led before it as regards the usage of the trade. It should, however, be borne in mind that the object of the enquiry in ultimate analysis is whether the mark used by the defendant as a whole is deceptively similar to that of the registered mark of the plain-: tiff.'

In AIR 1970 SC 1649 (Ruston and Hornby Ltd. v. Zamindara Engineering Co.), it was held (paras 4, 5, 6 and 7) :

'4, The distinction between an infringement action and a passing off action is important. Apart from the question as to the nature of trade mark the issue in an infringement action is quite different from the issue in a passing off action. In a passing off action the issue is as follows :

'Is the defendant selling goods 30 marked as to be designed or calculated to lead purchasers to believe that they are the plaintiff's goods?' 5. But in an infringement action the issue is as follows: --

'Is the defendant using a mark which is the same as or which is a colourable imitation of the plaintiffs registered trade mark?' It very often happens that although the defendant is not using the trade mark of the plaintiff, the get-up of the defendant's goods may be so much like the plaintiffs that a clear case of passing off would be proved. It is on the contrary conceivable that although the defendant may be using the plaintiff's mark the get up of the defendant's goods may be so different from the get-up of the plaintiff's goods and the prices also may be so different that there would be no probability of deception of the public. Nevertheless, in an action on the trade mark, that is to say, in an infringement action, an injunction would issue as soon as it is proved that the defendant is improperly using the plaintiff's mark,

6. The action for infringement Is a statutory right. It is dependent upon the validity of the registration and subject to other restrictions laid down in Sections 30, 34 and 35 of the Act. On the other hand the gist of a passing off action is that A is not entitled to represent his goods as the goods of B but it is not necessary for B to prove that A did this knowingly or with any intent to deceive. It is enough that the get-up of B's goods has become distinctive of them and that there is a probability of confusion between them and the goods of A. No case of actual deception nor any actual damage need ba proved. At common law the action was not maintainable unless there had been fraud on A's part. In equity, however, Lord Cottenham I. C. in Millington v. Fox, (1838) 3 My & Cr 338 held that it wag immaterial whether the defendant had been fraudulent or not in using the plaintiffs trade mark and granted an injunction accordingly. The common law courts, however, adhered to their view that fraud was necessary until the Judicature Acts, by fusing law and equity, gave the equitable rule the victory over the common law rule.

7. The two actions, however, are closely similar in some respects. As was observed by the Master of the Rolls in Saville Perfumery Ltd. v, June Perfect Ltd. (1941) 58 RPC 147 at p, 161 :

'The statute law relating to infringement of trade marks is based on the same fundamental idea as the law relating to passing off. But it differs from that law in two particulars, namely : (1) it is concerned only with one method of passing off, namely, the use of a trade mark, and (2) the statutory protection is absolute in the sense that once a mark is shown to offend the user of it cannot escape by showing that by something outside the actual mark itself he has distinguished his goods from those of the registered proprietor. Accordingly, in considering the question of infringement the Courts have held, and it is now expressly provided by the Trade Marks Act, 1938. Section 4, that infringement takes place not merely by exact imitation but by the use of a mark so nearly resembling the registered mark as to be likely to deceive.' In an action for infringement where the defendant's trade mark is identical with the plaintiffs mark, the Court will not inquire whether the infringement is such as is likely to deceive or cause confusion. But where the alleged infringement consists of using not the exact mark on the Register, but something similar to it the test of infringement is the same as in an action for passing off. In other words, the test as to likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passing off actions.'

6. Bearing in mind the distinction between the two kinds of actions, I would not proceed to consider whether this is a fit case where interim injunction as prayed for by the plaintiffs should be granted against the defendants until disposal of the suit. It is settled law that a plaintiff interim injunction under, Order XXXIX, Rules 1 and 2 of Civil P. C. must establish that he has a prima facie case, that the balance of convenience is in his favour and that he will suffer irreparable injury if injunction is not issued.

7. Therefore, the first question to be considered is whether the plaintiffs have established a prima facie case. Mr. P.N. Sewak, learned counsel appearing for the plaintiffs, has submitted that as the plaintiffs are the holders of the registered trade mark 'H.M.V.', the action of the defendants in operating under the trading style 'H.M.V. House' does amount to infringement of the plaintiffs' trade mark and that the goods handled by the defendants pass off as the goods of the plaintiffs although not manufactured by them because of the misleading description of the defendant-firm as 'H.M.V. House'. In support of his contention, learned counsel relies on the following decisions. In (1934) 51 RPC 315 (Crystalate Gramophone Record . v. British Crystalite Co. Ltd.), a Chancery Division of the High Court of Justice of England granted injunction against the defendants in a case where the defendants adopted their name in good faith as being descriptive of the 'crystal light,' sold by them, but that the plaintiffs and defendants were both concerned in the same trade, that their names were substantially similar, and that the use by the defendants of their name was calculated to cause confusion between the two businesses. In ILR (1970) 2 Delhi 344, (Nanak Chand v. Kohinoor Chemical Co, Ltd.,), the respondent was the registered proprietor of a trade mark 'Tibet Snow' since 1943. The appellants were manufacturers of cosmetics and the face cream manufactured by them was being marketed and sold under the mark 'Tibet Snow'. In these circumstances, interim injunction was granted against the appellants, particularly when the appellants' application for registration of trade mark Tibet Snow' had been dismissed earlier. In AIR 1978 Guj 216 (Simatul Chemical Industries Pvt. Ltd. v. Cibatul Ltd.), the names of two rival companies 'Cibatul Ltd.' manufacturing dyes and chemicals and 'Simatul Chemical Industries Pvt. Ltd.' manufacturing formaldehyde which is used as raw materials for the manufacture of other chemicals, were held to be deceptively similar and the latter company which had started the business of manufacture about twenty-six years after the former company, was asked to alter its name within six months from the date of the order. In AIR 1978 Delhi 250 (Century Traders v. Roshan Lal Duggar & Co.), it was held that proof of actual damage or fraud was unnecessary in a passing off action whether the relief asked for was injunction alone or unjunction, accounts and damages and that if there was a likelihood of the offending trade mark invading the proprietary right, a case for injunction was made out. The case involved two rival manufacturers of textiles. In M. A. 93 of 1982 (Arakhito Sahu v. Aba-kash Sahu) decided by this Court on 13-12-1982 (reported in AIR 1983 NOC 207), interim injunction was granted on the ground that there was over all similarity, phonetic and visual, in scheme and design and in structure between the mark on the labels and wrappers used by the plaintiff and the mark on labels or wrappers used by the defendants and that it was likely to cause confusion in the minds of probable customers or purchasers. The two firms in the case were both manufacturers of (Gudakhu).

8. Mr. I. Rath, learned counsel appearing for the defendants, has submitted that all the aforesaid decisions cited on behalf of the appellants involved rival manufacturers of similar or nearly similar goods and therefore they are distinguishable. In the present case, the defendants are admittedly not manufacturers. According to the defendants, they are retail dealers of goods bearing brand-names of companies like Cosmic India, Keltron, Meltron, Sony India, etc. The defendants merely store and sell the goods of the aforesaid companies. It is submitted that since all the goods bear their respective brand-names, there can never be any confusion in the minds of customers or purchasers. It is pointed out that in para-7 of the injunction petition, para-6 of the affidavit of Monisha Lahiri and para-8 of the plaint, it is stated that the trade mark 'H.M.V.' along with a logo is the house mark of plaintiff No. 2 and the same appears on all their goods, letterheads, packing materials, invoices, bills, pamphlets, literatures and advertisements and therefore there is no scope for any confusion by use of the trading style 'H.M.V. House' by the defendants which exists independently of any logo.

9. Upon consideration of the submissions of learned counsel on both sides it seems proper that at this stage the objections raised on behalf of the defendants must be upheld. Further, on scrutinising the pleadings I find that they suffer from insufficient particulars. Although a long list of goods in respect of the trade mark 'H.M.V.' is noted in para-3 of the injunction petition, para-2 of the affidavit of Monisha Lahiri and para-4 of the plaint, there is no specific assertion anywhere as to which are the goods in respect of which the present action is based. The pleadings of both parties are not at all clear on this point. On the basis of the pleadings and materials placed on record it is not possible to come to a prima facie findings as regards' the identification of the registered trade mark and the allegedly offending mark and the usage of the latter in course of trade in relation to goods in respect of which the trade mark is registered. Similarly, without any specification or identification of the goods in question at present it is not possible to hold that the goods sold by the defendants are passing off or likely to be passed off to the public as the goods of the plaintiffs. Accordingly, I hold that the plaintiffs have failed to establish a prima facie case.

10. On the issue of balance of convenience, I have carefully considered the respective cases of the parties as to comparative mischief and inconvenience. The facts of this case and the materials placed on - record do not indicate that the scale of inconvenience leans in favour of the plaintiffs. I am also not convinced that the plaintiffs cannot be adequately compensated by damages in case they ultimately succeed in the suit. The plaintiffs are not likely to suffer irreparable loss or injury in case interim injunction is refused.

11. For the reasons stated above, this appeal is dismissed and the impugned order of the learned District Judge is confirmed. There shall be no order as to costs. I would add that opinions expressed by me in disposing of this appeal shall have no bearing at the trial of the suit. The trial court shall be free to decide the issues before him without any way being influenced by the observations made in this appeal. I would, however, direct that the suit should be taken up for hearing and disposed of as expeditiously as possible. The records be sent back immediately.


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