Point of Law: Passing off of trade mark - Proprietary rights - Interim injunction - Appellant/defendant company, even though it has started using trade mark ‘AMPA’ only in 2018, has established substantial sales and customer base and goodwill in said mark - Balance of convenience also dictates that no injunction is passed against appellant/defendant company.

JUDGMENT :

Amit Bansal, J.

[Via Video Conferencing]

1. This appeal, under Section 13(1A) of the Commercial Courts Act, 2015 read with Order XLIII Rule 1(r) of the Code of Civil Procedure, 1908 (CPC), impugns the Order dated 17th March, 2021 of the learned Single Judge of this Court, confirming the interim injunction granted in favour of the respondent/plaintiff in I.A. No.12625/2020 under Order XXXIX Rules 1&2, CPC and dismissing I.A. No.1394/2020 under Order XXXIX Rule 4, CPC of the appellant/defendant, M/s Ampa Cycles Private Limited (company) in CS(COMM) No.569/2020 filed against the appellant/defendant company for permanent injunction to restrain passing off of trade mark and for ancillary reliefs.

2. The appeal first came up before this Bench on 18th May, 2021 when the counsel for respondent/plaintiff, appearing on advance notice stated that the complete paper book had not been received, and the matter was adjourned to 28th May, 2021, on which date the counsels were heard and orders were reserved. Both parties were also granted liberty to file notes of arguments along with copies of judgments to be relied upon, which have been duly filed by both sides.

3. It must be noted that initially, the learned Single Judge had granted an ad interim injunction in favour of the respondent/plaintiff vide Order dated 23rd December, 2020 till the next date of hearing, against which the appellant/defendant company had filed FAO(OS)(COMM) 9/2021. On 05th February, 2021 it was brought to the notice of the Division Bench hearing the appeal that an application under Order XXXIX Rule 4, CPC had been filed for modification/vacation of the Order dated 23rd December, 2020. Accordingly, while disposing of the appeal vide Order dated 05th February, 2021, the Division Bench requested the learned Single Judge to hear and decide the said application on the next date of hearing.

4. The suit, from which this appeal arises, was filed by the respondent/plaintiff, inter alia pleading that (i) respondent/plaintiff is the sole proprietor of M/s Four Diamonds engaged in manufacturing and selling of bicycles, tricycles, prams, baby rider bicycles and related products; (ii) M/s Four Diamonds, was initially formed as a partnership firm in 1983 with the respondent/plaintiff and one Hari Dutt Sharma as its partners; (iii) the trade mark ‘AMPA’ and logo were coined by the respondent/plaintiff and later adopted by the partnership firm in 1991 in respect of bicycles and tricycles; (iv) the respondent/plaintiff has been using the trade mark ‘AMPA’ since 1991, first as part of the partnership firm M/s Four Diamonds and later as the sole proprietor of the firm; (v) subsequently, on 30th March, 1992 M/s Ampa Bikes Pvt. Ltd. (ABPL) was established with the respondent/plaintiff and the partnership firm M/s Four Diamonds as shareholders; (vi) Trademark Application No.669861 under Class 12 was filed by ABPL on 21st June, 1995 for the word mark ‘AMPA’, claiming user since 1st April, 1992. However, the said application was abandoned in 2002; (vii) vide Dissolution Deed dated 1st August, 2003 (Dissolution Deed), the partnership firm M/s Four Diamonds was dissolved with Hari Dutt Sharma exiting/retiring from the partnership and the respondent/plaintiff continuing the business under the trading name and style M/s Four Diamonds as his sole proprietorship concern; (viii) the respondent/plaintiff transferred his shares in the company ABPL to Hari Dutt Sharma towards settling the dues of the exiting/retiring partner; (ix) the respondent/plaintiff was to continue using the trade mark ‘AMPA’ and all the assets and goodwill were to be transferred to the respondent/plaintiff; (x) use of the ‘AMPA’ trade mark was to be continued by two entities i.e., (a) by the respondent/plaintiff in respect of cycles up to 14 inches in tyre radius and (b) by the company ABPL in respect of all cycle models of more than 14 inches; (xi) in 2013, the company ABPL was struck off from the Register of Companies ther