[Case Brief] Kirloskar Diesel Recon Pvt Ltd & Others v/s Kirloskar Proprietary Ltd. & Others – Bombay High Court

Case Name Kirloskar Diesel Recon Pvt Ltd & Others v/s Kirloskar Proprietary Ltd. & Others
Case Number Appeal from order Nos. 1152 to 1154 of 1994
Court Bombay High Court
Bench Justice SM Jhunjhunwala
Decided On 10th October 1995
Relevant Act/Sections Trade & Merchandise Act, 1958 – Section 2, Section 105 (c)
Author of the case brief Praher Vaidya

 Facts:

These appeals are directed against common order passed by the III Additional District Judge, in respondents’ applications under Order XXXIX, Rules 1 and 2 of the Code of Civil Procedure, 1908 for grant of an interim injunction in Civil Suits filed by the respondents herein in the Court of the District Judge. The suits have been filed for permanent injunction to restrain the appellants herein from using the word ‘Kirloskar’ as part of the corporate name of the appellant company in each appeal and/or its trading style so as to pass off or enable others to pass off the goods and/or business of 1st appellant as that of the respondents. In each of the said suits restricted to passing off action, the respondents had filed an application for grant of interim injunction. All these applications for grant of interim injunction have been disposed of by the common order impugned in these appeals. By the order impugned in these appeals, pending the hearing and final disposal of the said suits, the appellants have been restrained from using the word ‘Kirloskar’ as part of corporate name of 1st appellant in each of the appeals and/or trading style so as to pass off or enable others to pass off the goods of the 1st appellant in each appeal and/or business as that of the respondents or in any way connected with the respondents. Each of the respondents is a Company duly incorporated and registered under the provisions of the Companies Act, 1956 and that each of them belongs to well known ‘Kirloskar Group of Companies’. The word ‘Kirloskar’ forms part of the corporate name of each of the respondents. The 1st respondent is the registered holder of various trademarks under the provisions of the Trade and Merchandise Marks Act, 1958 (the Act) and also the registered holder of the Artistic word ‘Kirloskar’ under the provisions of the Copyright Act, 1957. The respondents filed that said suits to restrain the 1st appellant in each of the appeals by a perpetual order and injunction of that Court from using the word ‘Kirloskar’ as part of 1st appellant’s corporate name and/or trading style so as to pass off or enable others to pass off the 1st appellant’s goods and/or business as that of the respondents or in some way connected with the respondents and the ‘Kirloskar Group of Companies’.

Arguments of the Appellants:

  • The Respondents have no common cause of action and in want of proofs establishing common reputation, the Respondent is not entitled to the equitable relief of injunction.
  • The field of activity of the appellants and the respondents being different and there being dis-similarity in the products of the appellants and those of the respondents, the passing off action instituted by the respondents is untenable and as such, the respondents are not entitled to any relief by way of interim injunction granted by the learned Judge.
  • It is also submitted on behalf of the appellants that in the facts and circumstances of the case, the 1st respondent cannot be said to have acquired reputation or goodwill by reason of the use of trademark or trade name ‘Kirloskar’ by respondents 2 to 7.
  • The corporate names containing the word ‘Kirloskar’ was a bona fide act.
  • A person is entitled to use his own name or surname.
  • There is no evidence on record to show that prior knowledge of respondents goodwill made the appellants to mala fide adopt the word ‘Kirloskar’ in their corporate names.
  • Under Section 34 of the Act, the 2nd appellant is entitled to bona fide use of his surname as part of a corporate name of his companies and as such, no interim injunction ought to have been granted by the learned Judge.
  • No grant of equitable reliefs can be granted on account of delay and laches on their part.
  • The balance of convenience lies in favor of the appellants.

Arguments of Respondent:

  • The respondents are not required to establish fraudulent intent on the part of the appellants.
  • In the passing off action, it is not necessary for the respondents to prove actual confusion or deception to get the relief of grant of injunction as prayed for but are only required to establish a likelihood of deception or confusion being caused.
  • The requirement of a common field of activity is not found in passing off action more particularly so since the focus is shifted from the external objective test of making a comparison of activities of parties to the state of mind of the public in deciding whether it will be confused or not.
  • The trade name ‘Kirloskar’ has become a household word under which a variety of activities are undertaken by the respondents and since the appellants have adopted ‘Kirloskar’ as part of their trade names, action in passing off lies against the appellant even if the appellants may not carry on activities similar to those of the respondents.
  • Even if the appellants’ activities are remote, the same is likely to be presumed a possible extension of respondents’ business or activities.
  • The exclusive reputation in the trading name is to be protected and prevented from being debased.
  • The defense that the 2nd appellant is entitled to use his surname as part of corporate names of the 1st appellant in the appeals is not available in a passing off action. In any event, the defense that a person is entitled to use his own name or surname is not available to a limited company as the provisions of Section 34 of the Act give no such defence to an artificial person.
  • There has been no delay or laches on the part of the respondents in filing the suits and that there has been no acquiescence on the part of the respondents so as to disentitle the respondents the relief of injunction as prayed for.

Decision Held:

  • The respondents had served notice upon the appellants on acquiring the knowledge that the question of delay has to be balanced against the likelihood of respondents’ ultimately succeeding in the action and where the strength of respondents’ prima facie case is very strong, the respondents’ delay in filing the action would not disentitle the respondents to the reliefs and it would be right to grant rather than to withhold interlocutory injunction prayed for. According to the court, the respondents have made out a very strong prima facie case for grant of interlocutory relief and in the circumstances the delay, if any, on the part of the respondents in filing the suits docs not disentitle the respondents to interlocutory relief nor it amounts to consent, waiver or acquiescence on the part of the respondents nor even estoppel so as to disentitle the relief of grant of interlocutory relief to the respondents.
  • The principle of balance of convenience applies when the scales are evenly balanced. The existence of 1st Appellant in each appeal is very recent whereas the existence of the Respondents belonging to ‘Kirloskar Group of Companies’ has been for over a period of 50 years. The Respondents’ reputation is likely to be adversely affected if the Appellants are not prevented from using the word ‘Kirloskar’ as part of the corporate names of the 1st Appellant in each appeal. In the facts of the case, the balance of convenience is not in favour of the Appellants.

Common field of activity

It cannot be said that the absence of a common field of activity necessarily bars a plaintiff from relief. With the passage of time, the law on the requirement of common field of activity in a passing off action has radically changed. The real question in each case is whether there is as a result of misrepresentation a real likelihood of confusion or deception of the public and consequent damage to the plaintiff. The focus is shifted from the external objective test of making a comparison of activities of parties to the state of mind of the public in deciding whether it will be confused. What the respondents were required to establish is a likelihood of deception or confusion. With the passage of time and reputation acquired, the trademark ‘Kirloskar’ has acquired the secondary meaning and has become almost a household word. In the case of a trading name which has become almost a household word and under which trading name a variety of activities are undertaken, a passing off can successfully lie if the defendant has adopted an identical or similar trading name and even when the defendant does not carry on similar activity. Even if the defendant’s activities in such circumstances, are remote, the same is likely to be presumed a possible extension of the plaintiff’s business or activities.

Erosion (dilution) of goodwill or mark

  • The law of passing off protects goodwill against its erosion or mark. The exclusive reputation of trading name is protected and prevented from being debased.
  • The 1st Respondent though did not manufacture goods cannot be said to have any reputation in the trademark ‘Kirloskar’ or the goodwill in the mark more particularly when the 1st Respondent has given licenses in favour of Respondents 2 to 5 for use of the trademarks registered in favour of the 1st Respondent. The Respondents 2 to 7 being the registered users of the trademarks owned by the 1st Respondent in accordance with the Act, the 1st Respondent is also deemed user thereof.
  • Indeed, in a variety of circumstances reputation and goodwill in a name, mark or get up may be shared or divided amongst a number of different people. Where goodwill is shared, plaintiffs may bring proceedings jointly, separately or in a representative capacity. It is observed that when reference is made to ‘Kirloskar’ in business circles it is referred to the Respondents and the words ‘Kirloskar Group of Companies’ again refer to the companies of the group of the Respondents. Nothing has been brought on record to show that the Appellants belong or could belong to ‘Kirloskar Group of Companies’.
  • The defence that a man has a right to use his personal name is not available in a passing off action and interlocutory injunction is to be ordered since no man is entitled, even by the honest use of his own name, so to describe or mark his goods as in fact to represent that they were the goods of another person. It is of no doubt that as per Section 34 of the Act, a proprietor or a registered user of a registered trademark is not entitled to interfere with any bona fide use by a person of his own name or that of his place or business, or of the name, or of the name of the place of business, of any of his predecessors in business, or the use by any person of any bona fide description of the Character of quality of his goods, in the facts of the case, it cannot be said that the use of the word ‘Kirloskar’ as part of the corporate name of the 1st Appellant in each Appeal is bona fide more particularly when admittedly the 2nd Appellant was associated in a high office with the ‘Kirloskar Group of Companies’ as aforesaid and had participated in the image building campaigns and programmes of the Respondents and ‘Kirloskar Group of Companies’. Saving for use of the name as provided in Section 34 of the Act does not apply to an artificial person like incorporated company. In the case of an incorporated company, the adoption of the name is by choice whereas, in the case of a matured person, the adoption of the surname is not by choice. A company can be prevented from using a particular name even if it does not cause anything more than confusion.
  • In passing off action, the plaintiff is not required to establish fraudulent intent on the part of the defendant and as such, it was not necessary for the respondents to establish fraudulent intent on the part of the appellants in incorporating the word ‘Kirloskar’ as part of corporate names of 1st appellant in each of the appeals.
  • An injunction to prevent the use of the word ‘Kirloskar’ as part of the corporate names of the 1st appellant in each appeal can be granted even at the interlocutory stage. The appeal was thus dismissed.

Leave a Reply

Close Menu