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2017 Supreme(Del) 861

IN THE HIGH COURT OF DELHI AT NEW DELHI
BADAR DURREZ AHMED & ASHUTOSH KUMAR, JJ.
INTEX TECHNOLOGIES (INDIA) LTD. & ANR. – Appellants
Versus
M/S AZ TECH (INDIA) & ANOTHER – Respondents
FAO (OS) No.1 of 2017 & CM Nos. 301, 303 of 2017
Decided On : 10-03-2017

Advocates Appeared:
For the Appellant :Mr. Sudhir Chandra, Senior Advocate with Mr. Pravin Anand, Mr. Aditya Gupta and Mr. Utkarsh Srivastava
For the Respondent: Ms. Prathiba M. Singh, Sr. Adv. with Mr. Sagar Chandra and Mr. Ankit Rastogi

Headnote:

In a suit for passing off, the plaintiff must establish goodwill/reputation in the mark on the relevant date, i.e., when the defendant is alleged to have launched its product under the same or deceptively similar mark. The issue of added matter is also important while considering the grant of an injunction in a passing off action. Delay in filing the suit is also to be considered as a factor going towards disentitling the plaintiff to an injunction. The principles of grant of an interim injunction must be considered in the correct light, including the injury that may be caused to the defendant in case an injunction is granted.

Fact of the Case:

AZ Tech, the respondents, filed a suit against Intex, the appellants, for passing off, seeking a permanent injunction against Intex from using the mark “AQUA” in respect of mobile phones/cellular phones. The suit was filed after 14 months of the launch of Intex's mobile phones under the mark “AQUA”, during which Intex had sold ₹200 crores worth of phones under the mark and spent ₹27 crores on advertising. Intex argued that AZ Tech had copied the font and style of its “AQUA” logo during the pendency of the suit.

Finding of the Court:

The court held that AZ Tech had not established goodwill/reputation in the mark “AQUA” in India as on the date when Intex launched its product under the mark. The court also held that the addition of the word mark “Intex” to the word mark “AQUA” was sufficient to distinguish Intex's products from those of AZ Tech. The court further held that the delay in filing the suit and AZ Tech's conduct in copying the font and style of Intex's logo disentitled AZ Tech from obtaining an interlocutory injunction.

Issues: 1. Whether AZ Tech had established goodwill/reputation in the mark “AQUA” in India as on the date when Intex launched its product under the mark. 2. Whether the addition of the word mark “Intex” to the word mark “AQUA” was sufficient to distinguish Intex's products from those of AZ Tech. 3. Whether the delay in filing the suit and AZ Tech's conduct in copying the font and style of Intex's logo disentitled AZ Tech from obtaining an interlocutory injunction.

Ratio Decidendi: 1. In an action for passing off, the plaintiff must establish goodwill/reputation in the mark on the relevant date, i.e., when the defendant is alleged to have launched its product under the same or deceptively similar mark. 2. The issue of added matter is also important while considering the grant of an injunction in a passing off action. 3. Delay in filing the suit is also to be considered as a factor going towards disentitling the plaintiff to an injunction. 4. The principles of grant of an interim injunction must be considered in the correct light, including the injury that may be caused to the defendant in case an injunction is granted.

Final Decision: The court allowed the appeal, set aside the impugned judgment, and dismissed IA No.17138/2013. The parties were directed to bear their own costs.

JUDGMENT :

BADAR DURREZ AHMED, J.

1. The appellants (‘Intex’) are aggrieved by the judgment and/or order dated 24.12.2016 delivered by a learned single Judge of this court in IA No.17138/2013, which was an application filed under Order XXXIX Rules 1 & 2 of the Code of Civil Procedure, 1908 (‘Code’) in CS(OS) 2060/2013, filed by the respondents (‘AZ Tech’). The said suit and application were filed in respect of the trade mark ‘AQUA’. The respondents filed the said suit seeking a permanent injunction against the appellants (‘Intex’) restraining them from using the mark ‘AQUA’ in respect of mobile phones/cellular phones. The case was one of purported passing off. By virtue of the impugned judgment and/or order, the learned single Judge has allowed the application (IA No.17138/2013) filed by the respondents under Order XXXIX Rules 1 & 2 of the Code and has restrained Intex from using the mark “AQUA” or any other deceptively similar mark in respect of cellular/mobile phones and their accessories. Of course, when the present appeal came up for hearing on 06.01.2017, we had granted stay of the operation of the said judgment.

2. Mr Sudhir Chandra, the learned senior counsel, appearing on behalf of Intex, submitted that as per the respondents, Intex had launched its product under the mark “AQUA” in 2012. This is evidenced by paragraph 17 of the amended plaint. However, Mr Sudhir Chandra submitted specifically that Intex launched its mobile phones under the mark “AQUA” in August 2012. He also submitted that, as indicated in their written statement, the adoption of the mark “AQUA” was an honest adoption as it had no knowledge whatsoever of the respondent’s product under the mark “AQUA”. In fact, it was submitted that at the time when the Intex launched its product under the mark “AQUA”, the respondent’s alleged product with the mark “AQUA” was non-existent in the market.

3. The learned senior counsel further submitted that the suit was filed on 28.10.2013, that is, after 14 months of the launch of the mobile phones of Intex under the mark “AQUA” which was, as pointed out above, within the knowledge of the respondents. Within this period, Intex had sold “AQUA” phones to the extent of Rs 200 crores. It was pointed out that between 01.08.2012 and 31.03.2013, Intex had sold 1.75 lakh phones under the mark “AQUA”. Between 01.04.2013 and 13.11.2013, a further 2 lakh phones under the mark had been sold by Intex. It was also pointed out that approximately Rs 27 crores were spent on advertising and, in particular, on TV Commercials, which include commercials featuring the famous actor, Mr Farhan Akhtar. It was also submitted that the TV advertisements were first telecast on 11.06.2013 and the second video clip was telecast on 01.10.2013 onwards.

4. Mr Sudhir Chandra further pointed out that the sales in 2015-16 of the appellant’s mobile phones under the mark “AQUA” had grown to Rs 3193 crores. He also pointed out that far from the appellant attempting to ride on the goodwill and reputation of the respondents, it was the latter who tried to benefit from the appellant’s mark “AQUA”. He submitted that this is evidenced by the fact that AZ Tech, which allegedly had been using a different font and style for its mark “AQUA”, adopted an identical font and style which had been used by Intex. This imitation, according to the appellant, was done in the year 2015 during the pendency of the suit filed by the respondents [CS(OS) 20602013]. The font and style of the word mark “AQUA”, as used by AZ Tech and Intex and copied by AZ Tech in 2015, are set out in tabular form hereinbelow:-

AZ Tech’s logo when present suit was instituted

Logo adopted by AZ Tech in the year 2015

Intex’s logo since the year 2013

AQUA

aQua

aQua

5. Because of this, Intex filed CS(OS) 2668/2015 against the respondents for infringement of copyright and for passing off. It
































































































































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