Mittal Electronics v Sujata Home Appliances- DHC dismisses Stay Application

18th September, 2020 - 3:26 am Categories: Intellectual Property 0 Comments

In this case of Mittal Electronics v Sujata Home Appliances CS (COMM) 60/2020 the Delhi High Court on 9^th September 2020 delivered a judgement on the Ad Interim Injunction Application filed by the Plaintiff under Order 39 Rule 1 ad 2 of CPC. The Plaintiff, Mittal Electronics, through their partners, filed a suit against the Defendants- Sujata Home Appliances (represented by Khurana and Khurana- IP Advocates and Attorneys) in an attempt to get a stay order against them from manufacturing, purchasing or selling the home appliances and other accessories under the trade mark “Star SUJATA” or “SUJATA” (hereinafter referred to as the “Impugned Mark”) or any other identical or deceptively similar mark/corporate name/domain name/email address, claiming that the name violated its statutory rights by way of registration of their trade mark as well as passing off.

The Plaintiff claimed that the trade mark SUJATA was adopted by them in the year 1980, when the business gradually expanded into home appliances and electrical goods to include Mixer, Grinder, Grater, Shredder, Chopper, Mincer, Kneader, Atta Chakki, Electric Spin Drier, Electric Waste Dispenser, Electric Flat Iron, Heating, Cooling Ventilating, Steam Generating and Cooling Appliances. It is claimed by the Plaintiff that they registered the trade mark SUJATA from the year 1991 to 2018 in various classes (7, 8, 9, 11 and 35), several pending applications for the Impugned mark and huge sales under the same.

The Plaintiff claims that when they were made aware of the Defendant using the Impugned Mark, they filed the instant suit. The Plaintiff was initially granted an ad-interim injunction to refrain the defendants from using the domain names www.sujatahomeappliances.com and www.sujataro.com and the email address until the next date. The Court also appointed a Local Commissioner to visit premises of the Defendants.

In return, the Defendant No. 1 filed an application under Order XXXIX Rule 4 of the CPC before the Delhi High Court, however, the same could not be listed due to the Pandemic, hence, the Defendant No. 1 filed fresh applications under Order XXXIX Rule 4 of the CPC which was listed for hearing on the 9^th of June, 2020 in which they also pointed out that the Plaintiff had hidden material facts. It was seen that Mr. Rajesh Bansal, the Director of Defendant No. 1has started his business as Luxmi Enterprises based in Bhatinda in the year 2008 (then a proprietorship), and was manufacturing and selling water purifiers under the brand “SUJATA” primarily in the state of Punjab. Rajesh Bansal had been granted trade mark registration under application ni. 2337951, whereby the device mark “Sujata” was registered in favour Mr. Bansal as Luxmi Enterprise under class 11, in respect of water purifiers, RO systems, water filters with effect from 2th May 2012. The Defendant also placed on record invoices under the Impugned Trade Mark dating back to 2013. It was submitted that the Defendant No. 1 Company was incorporated comprising of only 2 directors, Mrs. Mamta Bansal and Mrs. Sampada Bansal. The Licence Agreement dating back to 2017, 23^rd December has also been placed on record. It was further submitted that in the year Mrs. Mamta Bansal, wife of Rajesh Bansal, died. She was replaced by her son Shubham Bansal and also Rajesh Bansal and his brother as directors of the company. Rajesh Kumar Bansal trading as Luxmi Enterprise has clearly stated the use of the Impugned mark since April 1^st, 2008.

The Defendant submitted that the Plaintiff only sold juicer, mixer, grinders and geysers despite the fact that the Plaintiff had got registration in various classes and is thus squatting on the trademark without using the same. It is clearly stated that the Plaintiff has never sold water purifier, RO systems or water filters for which the defendant No.1’s user under the trademark ‘SUJATA’ is prior in time hence the fact that defendant No.1 has a registration in its favour and was the prior user of the mark ‘SUJATA’ in respect of Water Purifiers, RO Systems and Water Filters was concealed from this Court when an ex-parte ad-interim injunction was sought.

Therefore, the Defendant No. 1 prayed that they are allowed to manufacture, sell, offer for sell, advertise its product namely water purifiers, water filters and RO systems under the trademark ‘SUJATA’ and does not seek vacation of the entire ex parte ad interim order in respect of other goods and also seeks release of the goods seized and sealed by the Local Commissioners besides seeking cost.

The Contentions of the Plaintiff were:

• The goods of the Plaintiff and that of the Defendant are allied and cognate goods.
• They are used by the same consumer in the same location and are sold through the same outlet.
• The Defendant’s mark is identical to the Plaintiff’s mark
• The adoption of the Defendant’s mark was dishonest and caused serious prejudice and damage to the Plaintiff.
• That the user of the Defendant No. 1 for the Impugned Mark is 2008, and hence the user of the Plaintiff in respect of similar, cognate and allied good is long before.
• Luxmi Enterprise and not Rajesh Bansal had filed the opposition in respect of the Plaintiff’s trade mark, and the addresses of Rajesh Kumar Bansal and Defendant No. 1 are different, and therefore it was difficult to correlate. It is contended that Defendant No. 1 is in violation of orders of this Court.

The Defendant No. 1 contends that:

• The details of user of the Impugned Mark in class 11 by Mr. Rajesh Bansal through M/S Luxmi Enterprise. As well as the details of user of the Mark by its licensor since 2008, April 1^st, have been accepted by the Trademarks Registry.
• Till date, the Plaintiff has not filed one single document showing manufacturing or sale of “SUJATA” for water purifiers, water filters and RO system and the documents filed relate only to the juicer, mixer, grinder and/or juicer-mixer-grinder.
• The Plaintiff did not oppose that the registration of the mark “SUJATA” in favour of Rajesh Bansal for did they file a rectification after the registration of the mark despite having come to the notice of the Plaintiff when the Defendant applied for the mark “Star SUJATA”. The rectification petition has been filed of the 7^th of March, 2020- thus the averment of the plaintiff that it came to know about the defendant No.1’s mark only after the service of the application under Order XXXIX Rule 4 CPC is incorrect. The defendant No. 1 also placed that license agreement and the master data on record.
• The Plaintiff’s trade mark application in class 11 for the Impugned Mark was filed in 2014 in 2014 on a “Proposed to be Used” basis, which they submitted clearly showed the Defendant’s No. 1’s user for the Mark “SUJATA” in class 11 was prior in time and despite advertisement of the Impugned Mark in favour of Rajesh Bansal in relation to water purifiers, water filters and RO system. On 16^th June 2016 had objected to the Plaintiff’s registration of the trade mark, this opposition is specifically within the knowledge of the Plaintiff which fact has been concealed in the present suit.
• Learned counsel for the defendant No.1 also states that the Plaintiff has filed indiscriminate documents during the course of the hearing and the present suit being a commercial suit no additional documents could be filed beyond 30 days that too without seeking leave of the Court.

The Court held that:

1. The prior knowledge that the Plaintiff was registered for water purifiers is evident from the number of documents, which were sufficient for the Plaintiff to conduct due diligence as to the constitution of defendant No.1 before filing the present suit.
2. That Plaint was filed on a complaint about the use of geysers, however, the prayer clause sought to injunct the geysers, water purifiers, RO systems, and the products juicer, mixer, and grinders that the Plaintiff has neither manufactured nor sold water filters, water purifiers, and an RO system, nor did the Plaintiff make any claim whatsoever in the plaint in respect of its user of the trade mark SUJATA water purifiers, RO Systems, and water filters, thus there was no need for the plaintiff to seek protection in relation to these goods and that too prior to its products juicer, mixer, and grinders.
3. That the decision in the Nandhini Deluxe v Karnataka Cooperative Milk (Civil Appeal No. 2943-2944 of 2018) is applicable to the facts of the present case- where they compared two business entities and held that it was possible for a subsequent entity to obtain a registration in respect of specific goods within a certain class even if there exists a registration on an identical or similar trademark which covers the entire class if it is established that the prior registered proprietor had no intention of using the mark in respect of the specific goods sought to be registered by the subsequent applicant. From the combined reading of Vishnudas Trading v Vazir Sultan Tobacco 1996 PTC (16) 512and Nandhini Deluxe (supra) it is evident that it is not necessary for the subsequent user to first apply for limiting the earlier registration to those goods which were being used by the prior registered proprietor before filing an application for registration in respect of the excluded goods.
4. Further, the court held that It is trite law when a suit is filed by concealment of material fact, the Plaintiff is not entitled to the relief of injunction being a discretionary relief.
5. Therefore, by concealing a material fact and adopting clever drafting, knowing well that Rajesh Kumar Bansal was the proprietor of mark ‘SUJATA’ for water filters, water purifiers, and RO system, the plaintiff sought and was granted ex parte ad interim injunction which is liable to be modified as per the proviso to Order XXXIX Rule 4 CPC on this count itself.
6. The Court also noted that despite that fact that the Defendant was also selling water filters, water purifiers and RO System under the Impugned Mark, no material has been included in the evidence by that Plaintiff that any customer was deceived into buying the Defendant’s products as that of the Plaintiff’s.

Therefore, the court held that from the facts even though it is evident that although the Plaintiff that the Plaintiff is the prior user for the Impugned Mark, only in the case of mixer, grinders, blenders, however, for the goods water filters, water purifiers, and RO System, Rajesh Kumar Bansal the licensor and director of defendant No.1 is the prior registered owner of the mark SUJATA and also the prior user, in fact the only user as till date plaintiff has not used the mark ‘SUJATA’ for water filters, water purifiers, and RO system. Though the goods of the Plaintiff and defendant may fall in the same broad classification of home appliances are different goods used for different purposes.

Therefore the Court held that ex parte ad-interim injunction dated 7^th February 2020 is liable to be modified for the concealment of material facts by the Plaintiff. The Court disposed of if the applications granting injunctions in favour of that Plaintiff and against the Defendants in terms of prayer where that are allowed to manufacture water filter, water purifier and RO System, which the Defendants can continue to manufacture and sell under the Impugned Mark.

Author:  Suvangana Agarwal, Litigation Associate at Khurana & Khurana, Advocates and IP Attorneys.  In case of any queries please contact/write back to us at aishani@khuranaandkhurana.com.