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1989 Supreme(Del) 286
High Court Of Delhi
KALINGA GUDAKHU UDYOG - Appellant
Versus
KONARK GUDAKHU FACTORY - Respondent
Interim Application 4517 of 1988
Decided On : 08/01/1989
AMARJIT SINGH, HEMANT SINGH, R.K.AGARWAL
Upon dissolution of a partnership, the trade mark and copyright become the property of the new firm, and all partners become the owners of the trade mark and the copyright in question.
Headnote:
TRADE MARK - OWNERSHIP - DISSOLUTION OF PARTNERSHIP - TRADE MARK BECOMES PROPERTY OF NEW FIRM - PARTNERSHIP NOT WOUND UP - NO EXCLUSIVE RIGHT TO USE TRADE MARK - TEMPORARY INJUNCTION REFUSED.
Fact of the Case:
Three partners entered into a partnership to manufacture and sell GUDAKHU under the registered trade mark "star" and copyright in the artistic label "star". The partnership was dissolved, and a new partnership was formed with four partners, including one of the original partners. The new partnership continued to use the same trade mark and label.
Finding of the Court:
The court held that the trade mark, which was the property of one of the original partners, became the property of the new firm upon its formation. All four partners became the owners of the trade mark and the copyright in question. Since the firm had not been wound up, the plaintiff had no right to exclusive use of the trade mark and the label, and the defendants could not be restrained by a temporary injunction from using the said trade mark and label.
Issues: Whether the trade mark and copyright became the property of the new firm upon dissolution of the original partnership.
Ratio Decidendi: The court relied on the following legal principles: * A trade mark which is the property of one of the partners becomes the property of the new firm upon its formation. * All partners become the owners of the trade mark and the copyright in question. * If the firm has not been wound up, the plaintiff has no right to exclusive use of the trade mark and the label, and the defendants cannot be restrained by a temporary injunction from using the said trade mark and label.
Final Decision: The court dismissed the plaintiff's application for a temporary injunction restraining the defendants from using the impugned trade mark and artistic label.
( 1 ) SHRI Ram Niwas Aggarwal, Smt. Saraswati Devi, and Smt. Dropadi Devi entered into a partnership by means of a deed of partnership dated 4th April, 1975. The partnership was to carry the business of manufacturing and sale of GUDAKHU at Udit Nagar, Rourkela. The said three partners were the registered owners of the Trade Mark "star" in class 3 under number 3,14,975 dated 9. 5. 76, in respect of GUDAKHU being tooth powder made from tobacco for sale in the states of Bihar and Orissa. The three partners were also owners of the copyright in respect of artistic work "star" attached with the certificate under registration No. A-34,376/81. According to this certificate Shri Ram Niwas Aggarwal one of the partners was an a author of this work.
( 2 ) THE partnership was dissolved by a deed dated 9th April, 1986 w. e. f. 31. 3. 1986. On the same day another partnership under the name and style of M/s. Kalinga Gudakhu Factory at Rourkela was constituted w. e. f. 1. 4. 1986. This firm had 4 partners namely S/shri Ram Niwas Aggarwal, Om Parkash Aggarwal Arun Kumar Aggarwal and Shri Sunil Kumar Aggarwal. It appears that disputes arose between the partners. Thereafter, Shri Ram Niwas Aggarwal, Sunil Aggarwal, two partners of M/s. Kalinga Gudakhu Factory and Shri Sanjay Aggarwal formed a new partnership firm to carry out the same business. Shri Ram Niwas Aggarwal, applied for registration of the assignment on 29th December, 1987 alleging that the said trade-mark had been assigned to him. The certificate was granted by the Registrar on 29th January, 1988 in favour of Shri Ram Niwas Aggarwal, Shri Om Parkash Aggarwal, the other partner of M/s. Kalinga Godakhu Factory, it appears also started the business in the name of Konark Gudakhu Factory and started using the trade mark "5 STAR" and label Gudakhu.
( 3 ) FEELING aggrieved plaintiff firm filed this suit for permanent injunction restraining the defendants, its servants, agents, representatives and dealers and or other person on its behalf from manufacturing, selling or otherwise dealing in the tooth powder made of Tobaccu under the Trade mark "star BRAND" which was registered in the name of the plaintiff under the Trade and Merchandise Act, 1958 or under any other mark which was identical. Consequential reliefs were also claimed.
( 4 ) IN this suit the plaintiff has filed this application under order 39 rules 1 and 2 for grant of temporary injunction restraining the defendants from using the impugned trade mark star BRAND and artistic label entitled "star BRAND GODAKHU" or any other mark identical with or deceptively similar to the aforesaid registered trade mark and label of the plaintiff. This application was opposed.
( 5 ) I have heard the learned counsel for the parties. As noticed above three persons namely Shri Ram Niwas Aggarwal, Smt. Saraswati Devi and Smt. Dropdi Devi were registered owners of the trade-mark "star". They were also registered owners of copyright in the label "star" under the registration No. A-34,736/81. It is correct that under Column No. 7 of this certificate the name of the author is given as Shri Ram Niwas Aggarwal. It is, however, apparent from Column No. 11 and 12, that all these partners were owners of the copyright.
( 6 ) THIS firm was dissolved by a dissolution deed dated 9th April, 1986 w. e. f. 31. 3. 1986. Under the dissolution deed Shri Ram Niwas Aggarwal became the owner of the Trade Mark. However, on the same date, i. e. , on. 9th April, 1986 another partnership came into existence with 4 partners with Shri Ram Niwas Aggarwal, Arun Kumar Aggarwal and Shri Sunil Kumar Aggarwal. It is not disputed that the partners carried on the said Gudakhu business under the same trade mark and with the same label and same brand name.
( 7 ) IN the circumstances, as held in Addanki Narayanappa and another, Appellants v. Bhaskara Krishnappa (dead) and thereafter his heirs and others, Respondents,1 the Trade Mark which was the property of Shri Ram Niwas Aggar
