1. Defendant, a Service Co-operative Bank, in a suit for passing off, has filed this appeal challenging the decree passed by the learned District Judge, Thrissur. Respondent is the plaintiff.
2. In the above suit appellant/defendant had raised a counter claim also, which too was negatived by learned district judge while granting a decree in favour of respondent/plaintiff restraining the appellant by prohibitory injunction from conducting, running, manufacturing and selling coconut oil under the trade mark 'Kalpasree' or in any manner passing off and selling their coconut oil on the deceptively similar trade mark 'Kalpasree', which is the trade mark of the respondent/plaintiff. Appellant/defendant was also directed to surrender to plaintiff all the name boards, labels, wrappers, packaging materials, logo and other printing matters containing and consisting of the trade mark 'Kalpasree' together with blocks used for the purpose of printing the same, for destruction within three months from the date of decree. Aggrieved by the decision so rendered by the learned District Judge, defendant has filed this appeal.
3. I heard counsel on both sides and also perused records of the case. Case of the plaintiff in short is that it has been manufacturing and marketing coconut oil under the name and style 'Kalpasree' since 2003 onwards. That mark used by plaintiff, by long continuous use has got its own distinctiveness over which it has acquired a vested right. The defendant with intend to cause injury to plaintiff has adopted a name resembling the trade mark of plaintiff for sale of coconut oil produced by it was its case to seek a decree of injunction with further relief to direct defendant to surrender all its name boards, labels, wrappers etc. of the mark used by resembling the trade mark of plaintiff. The defendant has been using a trade mark 'KSB Kalpasree', which is deceptively similar to and resembling that of plaintiff, was the case of plaintiff for the reliefs canvassed aforesaid. Resisting the suit claims defendant filed a written statement in which it was contended that after conducting a selection process inviting applications from the public in and around the place where the bank functioned, the name 'KSB Kalpasree' was chosen by the bank to sell its product of coconut oil. Person who suggested that name for the product on its selection was awarded prize by the bank, and the name 'KSB Kalpasree' was accepted on 12.08.2002, was its further case. However, the usage of that name for the coconut oil produced by the bank commenced only in 2005. Bank also applied for registering that trade mark, which, later, was issued on 31.03.2008. Knowing of the use of mark 'Kalpasree' by plaintiff for its product of coconut oil which resembled 'KSB Kalpasree' chosen by bank for selling the same product, it had issued a notice on 28.05.2005 demanding the plaintiff to desist from using that mark. That notice was responded with a reply requesting for settling the issue. Subsequently, the bank getting information that plaintiff has obtained registration over the trade mark 'Kalpasree' initiated rectification proceedings before the Registrar on 22.10.2007 and the proceedings thereof are continuing, was the case of bank to contend that the plaintiff is not entitled to the reliefs canvassed in the suit. Defendant bank also set forth a counter claim in its written statement seeking a decree to restrain the plaintiff from using the trade mark 'Kalpasree' which is deceptively similar and resembled its registered trade mark 'KSB Kalpasree'.
4. Learned district judge appreciating the materials produced by both sides upholding the claim of plaintiff and negativing the counter claim of defendant passed a decree of injunction against the defendant from using the trade mark 'Kalpasree' for its product coconut oil with direction to surrender the name boards, labels, wrappers packaging materials, logo etc. of the trade mark 'Kalpasree' with the blocks thereof within the time specified. Decree passed in favour of plaintiff, and, negativing the counter claim of defendant, is impeached in this appeal.
5. Admittedly, both plaintiff and defendant in the suit have obtained registration over the respective trade mark claimed by them. Plaintiff has got registration of the trade mark 'Kalpasree' on 26.06.2007 and the defendant, registration of its trade mark 'KSB Kalpasree' with effect from 31.03.2008. If we go by Section 23 of the Trade Mark Act, 1999 (hereinafter referred to as 'the Act') registration given over a trade mark will relate back to the date of application. When that be so, where defendant filed his application for registration on 12.08.2002 registration given to its mark on 31.03.2008 has to be treated as effective from the date of his application. At the time when suit was instituted, both parties have not obtained registration of the respective trade mark claimed by them, but, their applications already filed were pending before the Registrar.
6. Counsel on both sides have argued at length, relying on some judicial authorities as well, in support of their respective case. On the admitted facts presented in the case, I find that the claim for injunction canvassed by plaintiff against the defendant in the action for passing off imputing that the reputation of his goods has been affected by the deceitful representation made by defendant on his trade mark resembling or identical with that of plaintiff, a detailed consideration of the authorities pressed into service is not called for. What is the difference between an action of infringement of a trade mark and an action of passing off has to be noticed. Of course, many of the rules and principles related to the action of infringement in general apply also in an action for passing off. However, the difference between these two has to be taken note when an action on a trade mark is presented before the court for adjudication. A plaintiff sues for infringement when his title by registration has been affected. He sues for passing off when reputation of his goods has been affected. Where his registered trade mark is imitated an action for infringement lies and where a false and deceitful representation is made expressly or impliedly an action for passing off lies. In the case of a registered mark the cause of action is founded on property which has been infringed, and in the case of passing off plaintiff has to prove the reputation of his goods and also that it has been assailed by the false or deceitful representation made by defendant over his goods. The defendant has done what is calculated to pass of his goods as those of plaintiff, is the basis of an action for passing off. When that be so, on the facts presented in the case, whether the plaintiff is entitled to an injunction against the use of trade mark 'KSB Kalpasree' by the defendant for the product of coconut oil, which has resemblance with its trade mark of 'Kalpasree' has to be considered.
7. Plaintiff, admittedly, started operation of his business with the trade mark over the product of coconut oil only from 2003. Even assuming that he had contemplation of such a trade mark much before the commencement of such operation, his claim for an injunction against another in an action for passing off, which is based on the reputation of his goods and it being affected by the deceit of defendant, would arise only after commencement of the operation of his business, after his goods are presented before the public in the name of his trade mark. It is the reputation of goods and how it has been assailed by the false or deceitful representation of goods by the defendant that has to be established in an action for passing off. What has been proved in the present case is that the defendant bank invited from the public a name for the trade mark of its product conducting a competition. The name of 'KSB Kalpasree' was chosen giving a prize to the person who suggested that name. Even before plaintiff started operation of business over his goods, coconut oil manufactured by him, under the trade mark of 'Kalpasree', defendant had applied for registration of the trade mark 'KSB Kalpasree'. Plaintiff also applied for registration of his trade mark 'Kalpasree', but, later to the application moved by defendant. Both parties subsequently obtained registration of respective trade marks applied by them with the plaintiff getting his registration earlier. Whatever be the grounds for impeaching registered trade mark obtained by parties as against the other, if so aggrieved, that has to be canvassed before the appropriate authority, and, such challenges do not emerge for consideration or adjudication before the civil court in an action for passing off. Defendant filed application for registration of its trade mark on 12.08.2002 and registration was given for its mark on 31.03.2008. Section 23 makes it clear that when a mark is registered it will be registered as of the date of making of the application subject to the provisions of Section 154 which make special provision relating to applicants from citizens of convention countries claiming priority of the rights. Section 154 of the Act has no application to the present case. So much so, where the application for registration of its trade mark 'KSB Kalpasree' had been moved by defendant before plaintiff commenced his business with the trade mark 'Kalpasree', plaintiff cannot maintain an action for passing off against the defendant. Registration of trade mark will relate back to the date of application. Even on the date when plaintiff commenced his business operation with his trade mark, the application moved by defendant for registration of its trade mark was pending consideration before the competent authority, and, later, its trade mark was registered. In such a case the marks of both plaintiff and defendant are identical, that alone, cannot be considered as giving a cause of action to the plaintiff for passing off against the defendant. If it was a case where plaintiff had gained reputation over his goods much before the filing of application for registration by defendant, then, of course his claim founded on an action for passing off would lie. Both parties applied for registration of their respective trade marks with the application of defendant preceding that of plaintiff. Only after commencement of the proceeding of registration by both, plaintiff commenced his business. The action for passing off taken against defendant has necessarily to be considered taking into account the registration of the trade mark given to defendant, which would relate back to the date of application for registration. When that be the case, I find that plaintiff is not entitled to decree of injunction on a cause of action founded for passing off against the defendant. Both parties can move appropriate authority under the Act for revoking the registration of the other, if so advised. It is stated that rectification proceedings initiated by defendant as against the registration obtained by plaintiff is now pending. The decree passed by court below in favour of the plaintiff is liable to be reversed without prejudice to the right of plaintiff to seek reliefs from the competent forum as provided by law.
8. With reference to the declining of the counter claim raised by defendant by the learned district judge, after considering it on merits, which too is challenged in the appeal, suffice to state that in a suit for passing off action a counter claim of the nature canvassed by defendant could not have been entertained. The Act provides for institution of suit for infringement of a registered trade mark or any right in a registered trade mark or passing off arising out of the use by the defendant of any trade mark which is deceptively similar or identical with the plaintiff's trade mark, whether registered or unregistered. Such a suit has to be instituted before district court, is the mandate under Section 134 of the Act. When such a suit is filed by one party can the defendant file a counter claim in such suit against the plaintiff for any of the reliefs mentioned under Section 134 has to be examined. A counter claim is a claim raised in a written statement. A counter claim can be treated as a plaint, but, it cannot be considered as a claim instituted on a suit. Order VIII Rule 6-A of the Code of Civil Procedure directs for treating the counter claim as a plaint stating that it shall be governed by Rules applicable to plaints. Section 3(2)(b) of the Limitation Act provides that a counter claim can be treated as a separate suit and it shall be deemed to have been instituted on the same date on which the counter claim is made in the court. However, where the statute specifically mandates under Section 134 that suit for infringement etc. has to be instituted as a suit that will prevail and no claim thereof can be entertained otherwise than by a suit. A counter claim can be treated as a plaint as provided under Order VIII Rule 6-A(4) of the Code of Civil Procedure or even as a suit un
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der Section 3(2)(b) by the Limitation Act, 1963 would not be of any assistance where statutory mandate under the Act is for institution of a suit itself for the reliefs provided under the Act before the district court. When that be the case, counter claim raised by the defendant in the suit should not have been entertained, and it warranted an outright rejection. Decree dismissing the counter claim by the court below is nonest as it could not have entertained the counter claim in the suit. Decree of dismissal of the counter claim is reversed with the order that the counter claim of defendant shall stand rejected. Learned counsel for appellant/defendant sought for reservation of his right to raise the relief claimed under counter claim in appropriate proceedings in accordance with law. No such reservation is called for as he is free to canvass the reliefs claimed under counter claim, if so entitled, in accordance with law. 8. In the result, decree of injunction passed by the court below in favour of the plaintiff is set aside. Decree of dismissal of counter claim is reversed ordering rejection of that claim as not maintainable. Suit shall stand dismissed, and counter claim rejected, but, without prejudice to the rights of both parties to seek appropriate reliefs for revocation/rectification of the registration of the other as provided under the Trade Marks Act. Appeal is allowed as indicated above, directing the parties to suffer their costs.