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2023 Supreme(Del) 4460

IN THE HIGH COURT OF DELHI AT NEW DELHI
Amit Bansal, J.
Dhananjay Rathi – Appellant
Versus
Shree Vasu Steels Private Limited & Ors. – Respondents
CS(COMM) 267 of 2022, I.A. 9368 of 2022 (O-XXXIX R-9,10, 16(a) & (c) and 19(2)(c) of CPC), I.A. 10366 of 2022 (O-VI R-17 of CPC), I.A. 11562 of 2022 (u of S 124(1)(b)(ii) of Trade Mark Act for cancellation of Trade Mark no.367635), I.A. 17890 of 2022 (O-XXVI R-9,10,16(a) & (c) and 19(2)(c) of CPC).
Decided On : 15-05-2023

Advocates appeared:
Mr.C.M. Lall, Senior Advocate with Mr.Rupin Bahl, Mr.Karan Bajaj, Ms.Ananya Chug and Ms.Pooja Bhardwaj, Advocates, for the Plaintiff.
Mr.Nitinjya Chaudhry and Mr.Gaurav Bahl, Advocates, for D-1 to D-3.
Mr. Sudhir Chandra and Mr.Jayant Mehta, Senior Advocates with Mr.Rohit Amit, Mr.Ashish Choudhury, Mr.Arpit Choudhury, Mr.P.D.V. Srikar, and Mr. Anand Kamal, Advocates, for the Defendant.

The court emphasized the concurrent right of registered proprietors of the mark RATHI, the validity of the Trademark Agreements, and the permitted use of the mark. It also highlighted the plaintiff's failure to establish a prima facie case for grant of interim injunction and the resulting burden of costs.

Headnote:

TRADEMARK - Interim Injunction - Code of Civil Procedure, 1908 (CPC) - Order XXXIX Rules 1 and 2 - Sections 12, 28(3), 30(2)(e) of the Act - The court discussed the concurrent right of registered proprietors of the mark RATHI, the validity of the Trademark Agreements, and the permitted use of the mark. The court found that the plaintiff failed to establish a prima facie case for grant of interim injunction, and the balance of convenience did not favor the plaintiff. The interim order dated 28th April, 2022 was vacated, and the defendants no.1 to 3 were relieved from the undertaking given by them. The plaintiff was burdened with costs of Rs.5,00,000/- to be paid to the defendants no.1 to 3.

Fact of the Case:

The plaintiff sought relief of permanent injunction restraining the defendants no.1 to 3 from using the mark RATHI and restraining the defendants no.13 to 18 from issuing licenses to any third party/outsider. The defendants no.13 to 18 contended that they had the independent right to use the mark RATHI and had granted licenses to the defendants no.1 to 3. The plaintiff alleged that the defendants no.13 to 18 violated the terms of the MoU-2 and Trust Deed-2 by issuing licenses to third parties.

Finding of the Court:

The court found that the plaintiff failed to establish a prima facie case for grant of interim injunction. The balance of convenience did not favor the plaintiff. The interim order dated 28th April, 2022 was vacated, and the defendants no.1 to 3 were relieved from the undertaking given by them. The plaintiff was burdened with costs of Rs.5,00,000/- to be paid to the defendants no.1 to 3.

Issues: The issues revolved around the concurrent right of registered proprietors of the mark RATHI, the validity of the Trademark Agreements, and the permitted use of the mark. The court also considered the alleged violation of the terms of the MoU-2 and Trust Deed-2 by the defendants no.13 to 18.

Ratio Decidendi: The court held that the plaintiff failed to establish a prima facie case for grant of interim injunction. The balance of convenience did not favor the plaintiff. The court also found that the plaintiff's conduct caused pecuniary loss and injury to the defendants no.1 to 3, and would have caused prejudice to their goodwill and reputation in the market.

Final Decision: The interim order dated 28th April, 2022 was vacated, and the defendants no.1 to 3 were relieved from the undertaking given by them. The plaintiff was burdened with costs of Rs.5,00,000/- to be paid to the defendants no.1 to 3.

JUDGMENT

Amit Bansal, J.

I.A. 6428/2022 (O-XXXIX R-1 & 2 of CPC), I.A. 10738/2022 (O-XXXIX R-1 & 2 of CPC) & I.A. 7588/2022 (O-XXXIX R-4 of CPC)

1. By way of the present judgment, I shall decide I.A. 6428/2022 and I.A. 10738/2022 filed on behalf of the plaintiff under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (CPC), for grant of interim injunction and I.A. 7588/2022 filed on behalf of the defendants no.1 to 3 for vacation of interim injunction granted on 28th April, 2022 in I.A.6428/2022.

PROCEEDINGS IN THE SUIT

2. The suit, as originally filed, had only defendants no.1 to 3 as the defendants. Summons in the suit were issued on 28th April, 2022, when an ad interim injunction was granted in favour of the plaintiff, restraining the defendants no.1 to 3 from infringing the trademark RATHI of the plaintiff as well as passing off their goods as that of the plaintiff along with other ancillary reliefs and the Local Commissioners were appointed to visit the premises of the defendants no.1 to 3 to seize and inventorise infringing goods. The relevant portion of the injunction order is set out below:

    "Accordingly, Defendants, their directors, employees, servants, agents, distributors, partners, franchises, representatives, suppliers, affiliates, subsidiaries, franchisees, licensees, representatives, group companies, assignees, etc. are hereby restrained from:

    (i). using the impugned mark RATHI or any other mark which contains or is deceptively and confusing similar to the earlier well-known trademark RATHI either as a trademark or part of a trademark, trade name or part of a trade name, corporate name, electronic-mail, domain name or part of a domain name or in any manner which would amount to infringement of the registered and earlier well-known trade mark RATHI bearing No. 309435, till the next date of hearing;

    (ii). using the impugned mark RATHI or any other mark which contains or is deceptively and confusing similar to the earlier well-known trademark RATHI either as a trademark or part of a trademark, trade name or part of a trade name, corporate name, electronic-mail, domain name or part of a domain name or in any manner which would amount to passing off, till the next date of hearing; and

    (iii). disposing off or dealing with their assets, including properties mentioned in the Plaint, in a manner which may adversely affect the Plaintiff's ability to recover damages, costs or other pecuniary remedies that may be finally awarded to the Rathi Foundation, till the next date of hearing.

    30. Defendants, their directors, employees, servants, agents, distributors, partners, franchises, representatives, suppliers, affiliates, subsidiaries, franchisees, licensees, representatives, group companies and assignees are further directed:

    (i). to recall all goods, marketing, promotional and advertising materials bearing the impugned mark RATHI or any other mark which contains or is deceptively and confusingly similar to the earlier well- known trademark RATHI; and

    (ii). to make full and fair disclosure of any trademark application(s)/copyright applications filed for registration(s) bearing/containing the mark RATHI and/or any other mark/name which is identical or deceptively and confusingly similar to the earlier well- known trademark RATHI.

3. Subsequently, I.A. 7588/2022 was filed on behalf of the defendants no.1 to 3 seeking vacation of the ex parte interim injunction granted on 28th April, 2022. Notice in the said application was issued on 13th May, 2022. Reply has been filed on behalf of the plaintiff.

4. In the written statement filed on behalf of the defendants no.1 to 3, it was stated that the said defendants have been granted licenses to use the mark RATHI by the members/trustees of the Rathi Research Centre (hereinafter `RRC'). Accordingly, I.A.9048/2022 was filed on behalf of the plaintiff seeking impleadment of the members/trustees of RRC and I.A. 10366/2022 was filed seeking permission to amend the plaint.

5. I.A. 9048

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