The following judgment is delivered in a Civil Appeal filed by the defendant for challenging the interim order delivered by the Single Judge of the Bombay High Court restraining the defendant from making use of the name 'Mahendra & Mahendra' for carrying his business and which was later on confirmed by the Division Bench of the Bombay High Court. The trade names or trademarks are used by the company for doing business. The trademarks or trade names associated with a particular company helps consumers to identify the quality of certain products or services originating from a particular company. The reputation and brand value associated with the trademark is known as the goodwill of the business. The law of trademarks prohibits any one from taking benefit by using a deceptively similar trademark or trade name. A mark is said to be deceptively similar to another mark if it so nearly resembles the other mark so as to cause a confusion in the minds of the ordinary man. The disputed mark must have been created with the intention to deceive and cause confusion relating to the origin of the goods or services. The deceptively trade mark creates an impression in the mind of the common people that the original product or the company has some relation with the disputed trade mark or company. There is a relief available under the Trade Marks Act, 1999 in order to prevent such unlawful use and the plaintiff can seek the remedy of passing off or infringement to prevent such use. In case the suit is pending, the plaintiff can seek an interim injunction to prevent or restrain the other party (defendant) from using such deceptively similar trade mark or trade name till the suit is disposed of. The same question was raised in the instant case where the plaintiff i.e the respondent argued that the defendant i.e. the appellants used a deceptively similar trade name to that of the plaintiff's business.
· The Supreme Court delivered its judgment in the present case in the year 2001. The apex court held that the name “Mahendra & Mahendra” clearly infringes the previous trade name "Mahindra" used by the respondent in doing business for more than five decades together and had gained popularity and distinctiveness.
· The Supreme Court held that the Trial Court was correct in deciding that the plaintiff has primarily established a case and irreparable prejudice in its favour which necessitates the passing of an order of interim injunction preventing the company of the defendant which is yet to begin its business from using the name of 'Mahendra' or 'Mahendra & Mahendra' in order to carry on trade and business in its name.
· The apex court upheld the order of the Division Bench of the Bombay High Court and stated that there is no ground from interfering with the order of the Division Bench which confirmed the order of the Single Judge allowing the order of injunctive. The said appeal was dismissed by the court with costs amounting to Rs 15,000.
The present case deals with the provisions mentioned under Sections 106(2)(c) and 105(c) of the Trade and Merchandise Marks Act, 1958.
Section 106(2)(c) of the Trade and Merchandise Marks Act, 1958 lays down the provision that the court shall not grant relief by way of damages or account of profits in a passing off suit where the defendant satisfies the court that at the time he started using the disputed trade mark, he was not aware and had no reasonable knowledge for believing that the trade mark was already in use by the plaintiff and that when he had the knowledge of its existence and nature, he instantly stopped using the trade mark complained of as being the plaintiff's mark.
Section 105(c) of the Trade and Merchandise Marks Act, 1958 says that the suits for infringement of trademarks shall be instituted before the District Court. According to the section, no suit for passing off which arises from the defendant's use of any trade mark which is similar with or deceptively identical to the plaintiff's registered or unregistered trade mark, small be filed in any court lower than a District Court having the jurisdiction to try the suit.
The following are the major issues framed by the Supreme Court-
1) Whether there is a real likelihood of deception or confusion in the minds of the general public as a result of the misrepresentation or not?
2) Whether the plaintiff would suffer irreparable loss as a result of the use of deceptively similar trade mark or trade name?
3) Whether the injunction order of the High Court restraining the defendant from using similar mark was erroneous or not?
Mahindra & Mahindra Ltd., the respondent herein, instituted a Suit No. 4007 of 1998 in the Bombay High Court seeking a decree of permanent injunction against Mahendra & Mahendra Paper Mills Ltd., the appellant herein, restraining it from using in any manner as a part of its corporate name or trading style the words "Mahendra & Mahendra" or any word which is deceptively similar to "Mahindra" and/or 'Mahindra & Mahindra'. In the said suit the plaintiff filed an application seeking an interim order of injunction against the defendant on similar terms.
The case of the plaintiff (respondent) is that it is a 'company' named 'Mahindra and Mahindra Ltd.' incorporated and registered under the Indian Companies Act, 1913.The company has changed its name from 'Mahendra and Mohammed Ltd.' to 'Mahindra and Mahindra Ltd.' in the year 1948 and since then, it has been continuing its business under the changed name 'Mahindra and Mahindra Ltd.' The said company is a flagship company of the Mahindra group of companies which included within its ambit 15 other companies.The word 'Mahindra' is a registered trade mark bearing Registration No. 338997, in respect of the goods in Class 12 of the Trade & Merchandise Marks Act, 1958.The word 'Mahindra' is a registered trade mark of the plaintiff in respect of the goods mentioned in Class 12 of the Trade and Merchandise Marks Act, 1958. The word 'Mahindra' also forms the most important and significant part of the group of companies owned by the plaintiff which are engaged in industrial and trading activities. The plaintiff contended that the name along with the trade mark of 'Mahindra' has earned popularity throughout the country due to its high quality of goods and services offered to the consumers. It was further stated by the plaintiffs that the Mahindra group of companies have a brand value and a nation-wide reach which includes distributors and sellers across the globe. The name of ''Mahindra'' along with its trademark has earned popularity, reputation and goodwill through the selling of high quality products and services among the general members of the public across the world including India. The plaintiff further pleaded that the company of the defendant i.e. the appellant was incorporated in 1994 and it was only in the year 1996 that the plaintiff came across a prospectus of the defendant's company and for the first time came to know about the existence of the company of the defendant by the corporate name 'Mahendra'. The name of the defendant's company is almost similar to that of the plaintiff's business name with the only difference being in the spelling 'Mahendra' which has been formed by substituting 'e' for 'i' in 'Mahindra'.
· The first contention of the plaintiff is that the words are phonetically, visually and structurally almost similar and they are deceptively similar. The defendant has use the words namely "Mahendra and Mahendra" more prominently in contrast to the rest of the words in the name. The plaintiff argued that the defendant used similar name in his business to fraudulently and illegally deceive the consumers into believing that the defendant's business has some relation with the plaintiff's established business. The plaintiff intended to wilfully use the plaintiff's brand name and reputation to his advantage. The apprehension of the plaintiff is that the use of the deceptively similar words or name as that of the plaintiff's corporate name has been done intentionally by the defendant to pass-off or possibly pass-off and for enabling others to pass-off its products and services as that of the plaintiff's business. Though the plaintiff has intimidated the defendant that they were using the deceptively similar trade name as that of the plaintiff, the defendant defended them by saying that they were honestly using the name of 'Mahendra' and the said allegations made by the plaintiff was false, frivolous and misconceived. Thereafter, the plaintiff (respondent) filed a suit claiming for a temporary injunction.
· The defendant contended that they were using the words 'Mahendra & Mahendra' as their corporate name continually for different businesses since 1974 and it is wholly misconceived that the defendant is using the goodwill associated with the plaintiff's business. The defendant argued that the name 'Mahendra' is a common name in Gujarat and several businesses are running in the said name across the State of Gujarat. The defendants also said that their products are not at all identical with the manufactured products and services provided by the plaintiff. The defendant is carrying on a separate business to that of the plaintiff and its business do not have common characteristics with the business operated by any of the plaintiff's enlisted companies. The defendant further pleaded that it has a brand value of its own name of 'Mahendra & Mahendra' and it was not gaining any profit by the trade name which is alleged to be deceptively similar to the corporate name of the plaintiff's business. The defendant completely denied the allegation that its trade mark and trade name is creating a likelihood of confusion with the trade mark 'Mahindra' and/or 'Mahindra & Mahindra'. The defendant denied the plea of passing-off or likelihood of passing-off of business and trading activities of the plaintiff. The defendant argued that the balance of convenience does not support the case of the plaintiff and the plaintiff would not be suffering from an irreparable injury in case the Court refuses to grant injunction in the present case. However, the Single Judge of the Bombay High Court passed an order of interim injunction restraining the defendant (appellant) from using the corporate name of “Mahendra and Mahendra” or any other word(s) that is deceptively similar to the established business name of “Mahindra” or “Mahindra and Mahindra” owned by the plaintiff. The defendant (appellant) sought an appeal to the Bombay High Court wherein the Court dismissed the appeal. The Division Bench of the Bombay High court also upheld the order passed by the Single Judge of the High Court. Thereafter, the defendant (appellant) filed the present appeal before the Supreme Court of India.
· Senior Advocate P. N. Misra appearing for the appellant (defendant) in this appeal contended that it is not a case supporting the allegations of infringement of trade mark but it is an action in passing-off the business and services. He further contended that there is no similarity in the goods manufactured or sold by both the companies under their respective trade names. In the nonexistence of any such likeness, the tests for identifying deception or confusion amongst the general public do not come to mind. The learned counsel, Shri Misra stated that the action of passing- off is not to be construed in the theoretical sense and it has to be determined depending upon the facts and circumstances of each case. The appellant argued that they were using the words 'Mahendra & Mahendra' as their corporate name continually for different products and businesses since 1974. Therefore, the pleading of exclusive user as made by the plaintiff (respondent) was baseless. The learned counsel further said that in order to judge the plea of passing- off made by the plaintiff, the Court must apply the test of probability and not plain possibility of giving rise to confusion or deception. He submitted that the order of interim injunction passed by the learned Single Judge in favour of the plaintiff was not warranted and the said order should have been set aside by the Division Bench of the concerned High Court.
· The Senior Advocate R. F. Nariman representing the respondent (plaintiff) pleaded that the grant of interim injunction by the Single Judge of the High Court is being made following well-laid down principles of law and the decision of the High Court upholding the order passed by the learned single Judge was valid in law. The respondent contended that on a bare reading of the prospectus issued by the appellant, it is evident that he is trying to use the good name and goodwill of the business associated with the trade name 'Mahindra and Mahindra' owned by the respondent. He further submitted that a man of average intellect and flawed recollection was likely to find the impression that the appellant has some connection or association with the established business of 'Mahindra and Mahindra' group of companies. He also stated that the appellant company has not commenced or started any business company. He also contended that the plaintiff has already justified his case before the High Court and established that the refusal to grant the said interim injunction would result in irreversible damage to the business of the respondent. He also said that the order of the High court upholding the decision of the Single Judge was correct.
· The Court in the present case considered the principles underlying Trade Mark Law and then summarized the following judgment. The following cases were considered by the apex court.
In Corn Products Refining Co. v. Shangrila Food Products Ltd. 1960 (1) SCR 968, the Court observed that the question as to whether the marks used by two companies are so identical so as to cause confusion or deception amongst consumers is to be primarily decided by the Court. The question has to be answered from the standpoint of a man of average intelligence and flawed recollection.
In Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd., 2001 (5) SCC 73, the Supreme Court laid down certain guidelines that is to be followed in tests for determining a passing-off action.
The factors can be summed up as follows:
a) The nature of the marks,
b) The degree of resemblances,
c) The nature of the goods,
d) The similarity in the nature, character and performance of the goods,
e) The class of consumers likely to purchase those goods whether they are educated or whether they will exercise a degree of care while purchasing those products,
f) The mode of purchasing the goods or
g) Any other surrounding factors that may be relevant depending on the facts of the case.
In Bata India Ltd. v. Pyare Lal & Co. 1985 AIR(All) 242, the High Court decided that the name “Bata” was earned popularity in the market and the use of such a well-known name would cause a likelihood of confusion or deception amongst the consumers and result in irreparable injury to the company of the plaintiff. The statement that both the parties are engaged in business in respect of different goods is not sufficient to to avert an action for passing-off.
The Court in the present case observed that the disputed business name is phonetically similar to the earlier trade name used by the respondent and there is likelihood that the disputed trade name might create an impression in the minds of the ordinary people that it has some relation with the respondent's business. The use of the similar trade name by the appellants would cause irreparable damage to the reputation earned by the respondents for the quality of their goods or services for a long time span exceeding 50 years.
· The apex court upheld the order of the Division Bench of the Bombay High Court and stated that there is no ground from interfering with the order of the Division Bench which confirmed the order of the Single Judge
The decision of the Court in the present case reiterated the settled position of law that the use of a deceptively similar mark would attract the provisions relating to Infringement or Passing-off, as the case demands. The Court clarified that even though both the parties involved in the proceedings are carrying on different businesses, they are forbidden to use deceptively similar Trade Mark or Trade name and in case there appears any deceptive similarity, it would attract the provisions relating to passing off in trade marks. The Court also restated the principles required to follow for filing an application seeking Interim Injunction. The principle of 'Balance of Convenience' shall be followed for weighing the injury for both the parties. A company is not permitted to use a mark similar to one that has already been in existence for a long time span. In this case, the plaintiff has been using the trade name 'Mahindra' along with 'Mahindra and Mahindra' in its business operating for over 50 years together. The common people have been associating the name of the company Mahindra with a certain standard of goods and services. Therefore, any attempt to use the same name will create a likelihood of confusion about the association of that name with the business of 'Mahindra and Mahindra Ltd.' Hence, in order to prevent irreparable damage to the goodwill of the business and trading activities of the plaintiff's business, the Courts granted interim injunction for restraining the defendant's from using similar name as that of the plaintiff's till the suit is finally disposed of.