w w w . L a w y e r S e r v i c e s . i n



M/s Swastiks Masalas Pickles and Food Products Pvt. Ltd., Bangalore & Another v/s M/s Swastik Mirch Stores, Hyderabad & Another

    TRA No.42/2003/TM/CH (O.P.No.368/2003)

    Decided On, 01 March 2005

    At, Intellectual Property Appellate Board

    By, THE HONOURABLE SHRI JUSTICE S. JAGADEESAN
    By, CHAIRMAN & THE HONOURABLE DR. RAGHBIR SINGH
    By, VICE CHAIRMAN

    R.Sudhakar, W.H.Kane, A.Prabhakar Reddy and R.Raghavacharyulu, Manohar Prasad Mathur and R.C.Varma.



Judgment Text

Hon'ble Shri Justice S.Jagadeesan, Chairman:


The petitioner filed OP No.368 of 2003 on the file of High Court of Judicature at Madras for rectification of the first respondent?s trade mark by removing the mark ?SWASTIK? registered under number 232283 in class 30 and cancel the same. By virtue of section 100 of the Trade Marks Act, 1999, the said OP was transferred to this Appellate Board and numbered as TRA/42/2003/TM/CH.


2. The case of the petitioner is that in or about 1973 one Mr. A.C.Venkatachalapathi, the promoter and Director of the first petitioner, originally started the business under the name and style Swastiks Chemical Industries as a proprietory concern at Bangalore, adopting the trade mark ?SWASTIKS?. In 1992 he inducted his son Shri A.V.Sridhar as a partner in the business and constituted the second petitioner firm under the name and style of M/s Swastiks Instant Food Products. The second petitioner firm took over the business of the first petitioner also as a going concern with its goodwill in the business and also with all tangible and intangible assets including rights under the registered and unregistered trade marks. The second petitioner adopted the trade mark ?SWASTIKS? along with the device of ?SWASTIK? in respect of various food products manufactured and marketed by them apart from the trade marks acquired from the first petitioner. The petitioners have got the registration of their mark under No. 330673 registered as of 15.11.1977 in respect of preparations included in class 30 for making gulab jamoon mix and arrowroot powder and under No.479408 for glucose registered as of 6.10.1987, both under class 30. Another registration No.546489 is in respect of castor oil under class 29 registered as of 4.3.1991. The petitioners also applied under application No. 480323 for glucose and application No.480324 in respect of instant jamoon mix as well as application No.818660 in respect of spices of all kinds and other products under class 30. They also filed application No.818659 in respect of edible oils, fats and pickles and other products under class 29 and application No.818661 in respect of agriculture, horticulture and forestry products and other falling under class 31, which applications are still pending with the Registrar of Trade Marks. The partnership firm was promoted as a limited company and accordingly incorporated as a private limited company under the name and style of the first petitioner Swastiks Masalas Pickles and Food Products Private Limited since 10.12.1999. After the incorporation of the first petitioner the trade mark ?SWASTIK? along with the goodwill owned by the second petitioner were assigned in favour of the first petitioner. The petitioners, right from 1973 through their predecessors in title and by themselves have been extensively using the said trade marks and their turnover in the year 1989-90 was Rs.33,33,124.88 and the same increased to Rs.5,10,37,565.13 in the year 1998-99. The first respondent filed suit OS No.73 of 2000 on the file of City Civil Fast Track Court at Hyderabad against the petitioner on the cause of infringement of their trade mark and the said suit is pending. In the course of the trial of the said suit before the fast track court, the petitioners came to know that the first respondent is using the name ?Swastik Mirch Stores? as a trading name and not using the mark ?SWASTIK? as a trade mark in respect of any goods. Hence the trade mark of the first respondent is neither distinctive nor adopted to distinguish any of its products. The registration by the first respondent itself is only as ?Swastik Mirch Stores? and the business of the first respondent is a wholesale store. To the knowledge of the petitioners the first respondent is not manufacturing or marketing any food preparations under the alleged trade mark ?SWASTIK?. The first respondent filed a suit before the City Civil Fast Track Court at Hyderabad on the ground that their registered mark ?Swastik Mirch Stores? under No.232283 under class 30 is for the manufacture of chilly powder, turmeric powder, coriander powder masala. As the first respondent did not use the impugned mark in relation to any goods specified in the certificate of registration and moreover it is only a trading name of the first respondent, ultimately the first respondent is not using the mark in respect of any goods mentioned in the specification for a period of five years and one month prior to the date of filing of the application, is allowed to stay in the register without sufficient cause and consequently is liable to be removed from the Register. When, from the inception of the registration of the first respondent?s mark, ?Swastik Mirch Stores? being used only as a trading name of the first respondent and there being no bonafide intention on the part of the first respondent to use the said mark ?SWASTIK? as a trade mark in respect of any of the commodities mentioned in their registration certificate, the impugned mark is liable to be removed from the Register and hence the petitioners are seeking the relief.


3. The first respondent filed counter statement stating that their mark cannot be challenged since 7 years had elapsed after the registration and the same has become valid in all respects. Further the suit OS No.73/2000 on the file of City Civil Fast Track Court at Hyderabad had decreed in their favour on 1.5.2003 and the appeal filed by the petitioners are pending. As the matter is sub-judice before the Court, the application is not maintainable. The first respondent is using the registered mark ?SWASTIK? since 1965 and gained unrivalled reputation for its quality and purity. The petitioners have adopted the mark to infringe the registered trade mark of the first respondent and there is no honesty in the conduct of the petitioners in adopting the mark as their registration is subsequent to the registration of the first respondent. So far as the registration of the petitioners? mark in respect of gulab jamoon mix, arrow root powder, glucose is concerned, the first respondent is not manufacturing those products. The petitioners have filed the petition only to overcome the order of injunction granted by the civil court. The first respondent is a leading manufacturer of spices, masala etc., for the past five decades and to label him as ?Wholesale provision shop? is defamatory. They are manufacturing masalas, mirch, turmeric, garam masala, sambhar masala, peppu powder etc., and they have established their reputation by the name ?SWASTIK? only. The mark has been renewed periodically and swastik masala of the first respondent have no rivals. Basically the first respondent applied for the name as a trade mark for their goods. As the petitioners adopted the mark of the first respondent and created confusion in the trade as well as among the public, the first respondent filed the suit which ultimately was decreed. Though the appeal filed by the petitioners is pending in the High Court that cannot be a reason to maintain the application for rectification. The first respondent is using the trade name in respect of the goods continuously without any interruption.


4. We have heard the arguments of Shri R.Sudhakar learned counsel assisted by M/s Kane, Prabhakar Reddy and Raghavacharyalu for the petitioners and Shri Manohar Prasad Mathur learned counsel assisted by Shri R.C.Varma for the first respondent.


5. Learned counsel for the petitioners contented that the petitioners adopted the name ?SWASTIK? being an auspicious symbol of Lord Vishnu and started his business for food products by obtaining registration in class 30 as early as 15.11.1977 in respect of gulab jamoon mix and arrowroot powder. The same mark was also registered in class 30 in respect of glucose as early as 6.10.1987 and in respect of castor oil on 4.3.19991 in class 29. In respect of certain other goods, the registration has been sought by filing applications in the year 1998 and the same are pending consideration. The first respondent had obtained the registration of the impugned mark ?Swastik Mirch Stores? and is running a provision store under the said name and style. The first respondent never used the mark ?SWASTIK? in respect of any of the goods or products. In fact the first respondent was not engaging himself in manufacturing process and as such they obtained registration of the impugned mark without any intention to use the same for manufacturing of chilly powder or any other products in class 30 specified in the registration certificate of the first respondent. The evidence let in by the first respondent in their suit OS No.73 of 2000 on the file of City Civil Fast Track Court at Hyderabad also did not establish the use of the impugned mark by the first respondent in the manufacture and selling of chilly powder, turmeric powder, coriander powder and masala, the goods mentioned in their certificate. Further there is absolutely no evidence to show that the first respondent had used the said mark in respect of any of the products mentioned in the certificate of registration. The first respondent has not used the trade mark right from the date of the registration and the said mark was not used even during the time of filing the application for registration. Hence the impugned mark is liable to be rectified by way of cancellation in respect of the goods specified in the registration certificate in accordance with clause (b) of sub section (1) of section 46 of the Trade and Merchandise Marks Act, 1958.


6. On the contrary the learned counsel for the first respondent contended that the City Civil Fast Track Court had granted a decree in favour of the first respondent on the cause of infringement and thereby restrained the petitioners from using the mark ?SWASTIK?. Though the appeal is pending, it is not open to the petitioners to seek any relief before this Appellate Board as no party can be permitted to invoke the jurisdiction of two forums simultaneously. He further contended that the evidence let in along with the counter to this petition would clearly prove the user of the impugned mark by the first respondent and especially the income tax returns are clear proof for the use of the impugned mark by the first respondent. He also contended that the first respondent is the prior user since 1959 and the burden of proof being on the petitioners, they have not discharged the same. Consequently the petition is liable to be dismissed.


7. We have carefully considered the contentions of both the counsel. Admittedly the first respondent has obtained the registration of their mark as per document 3 produced by the petitioner, which is as follows:-


The first respondent had applied for the impugned mark on 16.11.1965 claiming user since the year 1959. The same has been renewed periodically from 16.1.1972 and as per document No.5 produced by the petitioners the last renewal was made on 16.11.1993. There is no dispute that the said mark had been renewed further. The petitioners? registered mark of the year 1977 is word per se ?SWASTIKS? in respect of preparations included in class 30 for making gulab jamoon mix and arrowroot powder. The same mark was registered in respect of castor oil for edible purpose as early as 4.3.1991. They had applied for the mark on 17.9.1998 with the monogram ?SWASTIK? in class 29 claiming user since 1973. They had also applied for the same mark with the ?swastik? monogram on 7.9.1998 in respect of pappad and namkeen, ices, honey, yeast, baking powder, salt, mustard, vinegar, sauces, rice of all kinds, maida, rawa, sujji, atta, pulses and spices of all kinds, noodles, desert and puddings and another application under class 31 in respect of pan masala, betelnut powder, mouth freshners and fodder. The petitioners claim is that they have engaged themselves in various readymade powders from the year 1973. Document No.13 series deals with bills and invoices about which there is no dispute. Similarly document No.14 series also deals with the same for various periods.


8. The general principles on the question of onus is that when both parties have let evidence, even though it is affidavit evidence, as is in the normal procedure, the question of onus ceases to be that important and the only thing that remains for the Tribunal or the Appellate Board to do is to arrive at a true inference upon the whole of the evidence let in by both. When the entire evidence of both sides is before the Court, the debate as to onus is purely academical. It has also been held in 57 RPC 137 in the case of Shredded Wheat Ld. Vs. Kellogg Co. of Great Britain Ld. that in discharging the onus the party may rely only on the evidence adduced by it, but also on the evidence adduced by its adversary. Keeping these principles in our mind, we considered the arguments of both the counsel. By way of evidence through the affidavit, the petitioner relying upon the evidence of the first respondent let in before the Civil Court has now claimed that the first respondent has not used their impugned mark for the purpose of manufacturing or selling the goods specified in their registration certificate and as such their mark is remaining in the Register of Trade Marks without any sufficient cause and on the ground of non user as contemplated under section 46(1) (b) of the Act the mark has to be rectified. The short question is whether the petitioners are entitled for the relief? The first respondent did not dispute the evidence let in by the petitioners in respect of their use, advertisement. In the affidavit filed by the petitioners they have specifically stated that the first respondent is not using the impugned mark in respect of manufacturing any goods specified in the registration certificate and it is clear from the evidence let in by the first respondent in the civil suit. The first respondent has obtained the registration of the impugned mark as a trade name which is prima facie clear from the mark itself. If the mark is in respect of the goods then the words ?Mirch Stores? need not be mentioned along with the trade mark unless the registered mark being the trade name of the first respondent. Though the first respondent filed the counter and produced evidence, in the counter the first respondent had stated that they are in the manufacturing field and they are also selling the powder which is specified in their registration certificate. The petitioners had discharged their burden by way of evidence filed by them. In order to prove the negative, that is, there is no sale by the first respondent in respect of the goods specified in their registration certificate, one cannot expect any positive evidence. Hence we have to now consider whether the averments in the affidavit filed by the petitioners by way of evidence had been controverted and the first respondent had established their defence. First respondent had produced the copy of the judgement in the civil suit and registration certificate, copy of carton in respect of garam masala, pepper powder, sambar masala and the income tax return along with their pouch in respect of dhania powder, mirch powder and haldi powder. From the evidence of the first respondent whether the use of their mark in respect of the goods for which the registration had been obtained or in respect of the goods mentioned in their registration certificate have been made out is to be considered.


9. So far as the civil court judgement is concerned, admittedly the appeal is pending. Hence the same may not be of any use. Even otherwise the principle with regard to the infringement of the trade mark is totally different with regard to the principles governing registration or rectification of the trade mark. On that ground also the judgement of the civil court cannot be of any assistance for the first respondent. So far as the copies of the carton and the pouch are concerned, it is not clear as to how long the same being used by the first respondent. These pieces of evidences without any difficulty can be procured at any point of time as they are made to order and no reliance can be placed on these self serving materials for the use of the trade mark unless the same are corroborated by other evidence such as bills for printing or otherwise. So we are left only with the sales tax return for the year 2000-01 and the income tax return for 2001-02. Learned counsel for the first respondent contended that in the income tax return there is a reference that the first respondent is dealing in manufacture of chilly powder, turmeric powder, dhania powder and this would clearly establish that the first respondent is dealing in manufacture of the said powders. In the statement of sales tax return regarding purchase there is a reference to unpaid purchases of chillies to the tune of Rs.4,91,65,551 and paid purchases of chillies is Rs.30,57,254. Similarly in respect of turmeric, coriander, amchur there are respective entries regarding unpaid purchases and paid purchases. Correspondingly in the sales account the same is repeated. However in the sales account in respect of sales tax accounting year 2000-02 there is a reference in item 4 as secondary sales of spices goods. It is the contention of the learned counsel for the first respondent that secondary sale of spices goods is nothing but the powders referred to in their registration certificate. The first respondent is dealing in the same under their registered trade mark. Similarly it was pointed out from the income tax assessment order for the year 2001-02 about the reference to the first respondent manufacturing and selling of mirch powder, turmeric powder etc., which would conclusively establish the use of the registered trade mark by the first respondent in respect of the product for which the registration was obtained. We are concerned with both the goods as well as the use of the trade mark, in relation to the goods. By the existence of the goods the use of the mark cannot be inferred because the non use of the registered trade mark would make the trade mark die. Hence when prima facie the petitioners had established that the first respondent was not using the registered trade mark, it is for the first respondent to prove and establish the use of the same. A mere statement either in the sales tax or in the income tax assessment order that the first respondent is manufacturing and dealing in various powders, in our view is nothing but a self statement which do not establish the use of the registered trade mark. Even if the first respondent is manufacturing and dealing with such powders, correspondingly he has to prove that such goods are being identified with his registered trade mark and the registered trade mark is being used in respect of the goods for which the registration was obtained. Hence the income tax assessment or the sales tax assessment orders do not help the first respondent.


9. When the first respondent has produced the cash book, ledger, purchase and sales register before the sales tax authorities, nothing prevented them from producing the same before this Appellate Board. Definitely the sales bills would establish the nature of goods that are being sold by the first respondent. When the first respondent?s mark has been registered as a trade name, perhaps the purchase book and the sales book may relate to the first respondent?s dealing in chilly, turmeric etc., as a dealer and not engaged himself in the manufacture of powder and sale of the same. The non production of the sales tax assessment is also fatal to the first respondent?s claim. The non production of these vital documents invites an adverse inference against them.


10. It may be worth to refer the judgement of the Court of Appeal in 1928 RPC 397 at 402 where the question of use had been elaborately considered as given below:-


?If one turns then to Section 37 and considers what a trade mark is, it appears that these two alternative grounds which are given for the purpose of the removal from the Register have a direct relation to the origin of a trade mark, its nature, its definition; and it can be taken off on the ground that it was registered without any bona fide intention to use the same in connection with such goods. What is the meaning of bona fide? I think that must mean a real intention in the sense which I have already explained, and if it is not found that there was that real resolve, intention and purpose, then it is shown that originally the mark was put upon the Register at a time when it ought not have been put on, because there was not a sincere purpose to make use of the mark in connection with goods.


If that is the right view, it accords precisely with what Mr.Justice Tomlin has determined. He says : ?I do not think there was at the time of registration any definite and present intention to use it within In re Batt?s Trade Marks, the language of which is as appropriate today as when that case was decided.? It appears to me, therefore, that Mr. Justice Tomlin has reached what, to my mind, is the right construction of both the sections in the Act of 1905, with the consequence that, accepting the facts as found by Mr. Justice Tomlin, it has been proved to him that there was not, within the meaning of the Act, a bonafide intention to use; and on the second part it is admitted there was non-user up to the date of the application.


That being so, the Applicants have made out their case in accordance with the first ground stated in Section 37, and Mr. Justice Tomlin has come to a right conclusion. For these reasons, it appears to me that the appeal must be dismissed with costs.


In 1998 PTC (18) BOM Cluett Peabody & Co. Inc V. Arrow Apparals, the learned Judge in para 27 at page 175 had, extracting the principles emerging under the Trade Marks Act sufficed to refer the following alone:-


?(b) Trade mark is a property. A mark which is used in the course of trade to indicate a connection between the goods and the proprietor of the mark is a Trade mark (See Trade Marks by Shavaksha, Page 14). It is not a property in pervasive sense. It is property in the sense that proprietor is entitled to exclusive use of it or to prevent others from using it in relation to goods in respect of which it is registered or used. It must be adopted and used to distinguish the goods of the proprietor from goods of others. The mark must be distinctive. It must show the source or the goods to the customer. Words like ?Best? ?Superior?, etc. are not distinctive of the goods. They are only descriptive and hence cannot constitute trade mark. The vendor who sells his goods under a trade mark acquires a limited right to the use of the mark.


(c) XXXXX


(d) XXXXX


(e) The abovementioned limited exclusive right to the use of the mark is acquired by use. It is recognized as property. A person can also acquire it by registration [see para 1.01) of Narayanan]. The proprietor of the mark gets a perpetual right to the exclusive use of it in respect of particular goods in respect of which it is registered or used [see para 1.02 of Narayanan]. Therefore, it can be acquired in three ways viz. Registration, User and Assignment.


(f) Object of the Act is to protect the right and not to be a source of monopoly. It is also to protect bonafide interests of traders from harassment by registered owners of a trade mark, apart from protection of public fraud, fraud by infringers of genuine trade mark.


(g) Registration enables the registered proprietor to sue for infringement of registered trade mark irrespective of the fact whether it is used or not used. Registration confers on the proprietor a monopoly right over the use of the mark. But, proprietory rights in a trade mark acquired by use are superior to rights obtained by registration under the Act. This is the main defence put up on behalf of the defendants in this Notice of Motion. Therefore, prior use of the marks should be protected against monopoly rights conferred by the Act. [pages 5 & 6 of Narayanan]. A trade mark has no meaning even if it is registered unless it is used in relation to goods. Otherwise, its non-use may lead to its death. A trade mark which drops out of the use dies. Where there are no goods offered for sale, there is no use of trade mark.


(h) Use of the trade mark does not mean user by affixing the word on the goods. It could be in the form of advertisements in Magazines, T.V. etc. it would be with regard to goods exported out of India. With advancement of technology and globalization after 1991, use of trade mark can take place in different ways. But, this case essentially concerns the period 1985-1990. proprerty in trade mark can be acquired by public use of it.


(i) XXXXX


(j) XXXXX


(k) Courts shall not protect this right of a proprietor unless there is sale of the articles to which trade mark is attached or related to [para 28 of Narayanan]. Without use of the mark, the proprietor cannot restrain others from use of it on similar goods [page 29 of Narayanan].?


Finally the learned Judge concluded in para 31 at page 181 as follows:-


?The object of the Trade Marks Act is to protect the proprietary right of a registered trade mark holder. However, if the mark is registered and not used for thirty years, depending on the facts, prima-facie, it becomes a source of monopoly which is not the object of the Act. Just as the right of the customers or the purchasers of the goods are required to be protected so also traders.? who are in business over a long period of time, cannot be harassed by threat of litigation by registered proprietors, particularly when after registration, they have not used the mark for long period.?


The following observations in Harold Radford & Co. Ld?s Appl, (1951) 68 RPC 221 relating to the expression ?in relation to goods? are relevant for the purpose of the present case:-


?From this, it seems to me that use of a mark in advertising media must be concurrent with a placing of the goods on the market if it is to be registered as ?trade mark? use within the meaning of Sec.68. hence, I must hold that use of a mark in advertising media (solus) i.e. without any goods to offer concurrently with such advertising media is not ?trade mark? use within the meaning of Sec.68. I would add that to hold otherwise would seem to me to nullify the effect of certain sections of the Act. For instance, a proprietor of a registered trade mark might, without having any goods to offer, advertise his mark at periodic intervals, and thereby prevent any attack being made upon the mark under the provisions of Sec. 26(1) of the Act.?


Glossing upon the above observations of Mr. Faulkner in Harold Radford & Company case, J. Falconer in Hermes Trade Mark in the High Court of Justice, Chancery Division 1982 RPC 425 observed as follows:-


? Thus, if the registered proprietor should commence a series of advertisements featuring his mark as part of an introductory campaign, prior to putting his goods on the market under the mark, but before they were actually on the market, in my judgement such use would clearly be use of the mark in the course of trade, not upon the goods or in physical relation thereto, but it would be in other relation thereto, the point being that it would be use in the course of trade in those goods, albeit in advertisements?.


J.Ajoynath Roy in Kabushiki Kaisha Toshiba V. Toshiba Appliances Co. & Ors., 1994 PTC 53 (Cal), explained the law relating to rectification in India as under:-


?Thus a mere use of the trade mark in advertising or other publication media is insufficient as ?use?. That is quite understandable, because if it were not so, trafficking in trade marks could be legally indulged in, for a mark could be registered and thus kept alive merely by advertisement without evening putting any goods into the market.?.


In Latha C. Mohan V. Cavinkare Private Limited reported in 2004(29) PTC 340 (IPAB) we had an occasion to deal with the term ?use?. After referring to various judgements, we held as follows:-


The market research

Please Login To View The Full Judgment!

contests with a view to have a feel of the market in order to take decisions, for producing goods and identifying the brands and their potential is no substitute of the ?advertisements? so assiduously emphasized by the Courts in India and England as being a vehicle of bonafide use under section 46(1)(b). In those scheme of things, the definite product with a definite brand through identified sale channels is sought to be offered through advertisements. 11. In the case on hand absolutely there is lack of evidence in respect of the use of the registered mark by the first respondent in respect of the goods for which the registration had been obtained. Merely because there is evidence to establish his dealings in turmeric, chilly etc., falling in class 30 of Schedule 4, whether the first respondent can be presumed to have used the trade mark. Though class 30 refers to spices in general has no specific description of the different goods falling under the class spices. The spices may be as raw material which can also be used for the same purpose for which the powder spices are being used. Both the raw material and the powder may be available in the same trade channel but still it cannot be taken for granted that both are of same description. The purchaser of raw material may be using it as it is or dealing in it as it is or may make it into a powder and sell it in his own trade name. When the raw material can be purchased and is being capable of making powder for the purpose of sales in different trade names or trade mark, definitely both the raw material and the powder cannot be said to be the goods of same description. Necessarily this has to be classified into different description. Only in that sense we are at a loss to find any material to support the user of the registered mark by the first respondent either for raw material such as chilly, turmeric etc., or correspondingly on the goods specified in the registration certificate. Hence it is clear that the first respondent is having the mark as a trading name only. 12. For the foregoing reasons we are of the view that the petitioners have established that the first respondent has registered the mark only as a trading name for the provision store and not for the use of the same in respect of any goods for which registration had been obtained. Even assuming that the registration had been obtained with bonafide intention to use the same in respect of goods for which the registration had been obtained, but still the same has not been used by the first respondent from the inception of the registration or atleast for a period of five years and one month prior to the date of filing of application in respect of the goods for which the registration had been obtained. Hence we have to order the rectification. 13. Since the first respondent is not using the impugned mark in respect of the goods for which the same was registered, the rectification petition has to be ordered. Accordingly the same is ordered and the Registrar of Trade Marks, the second respondent herein is directed to remove the impugned mark ?SWASTIK MIRCH STORE? from the Register.
O R