Registered Trademark Owner Can't Seek Prohibitory Injunction If Opposite Party's Mark Is Also Registered, May Sue For Passing Off: Kerala High Court

The Kerala High Court recently set aside a District Court order restraining M/S Mariyas Soaps and Chemicals from using their registered trademark ‘Chandra’ for being prima facie similar to Wipro's soap range ‘Chandrika’.

The Division Bench comprising Justice Anil K. Narendran and Justice P.G. Ajithkumar observed it is settled law that an owner of a registered trademark cannot sue for infringement of his registered trademark if the opposite party also has the trade mark which is registered.

The bench was however quick to add that an aggrieved party may bring action for passing off. It observed,

"The rights granted by the registration in the form of exclusivity are not absolute but are subject to the provisions of the Act. Section 28(3) of the Trade Marks Act provides that the rights of two registered proprietors of identical or nearly resembling trademarks shall not be enforced against each other. However, they shall have the same rights as against the third parties. Further, the rights in passing off are emanating from the common law and not from the provisions of the Act and they are independent of the rights conferred by the Act."

'Chandrika' is Wipro's registered trademark for Ayurvedic soaps launched in 1940. The mark was registered in 1947 and an all India registration was obtained in 1976. Wipro (Respondent herein) contended that appellant attempted to market washing soap and detergents with a deceptively similar name 'Chandra'. It was alleged that the appellants had no authority to market their products using such a trade mark, since that would infringe Wipro's registered trademark.

The District court found that the mark ‘Chandra’ was deceptively similar to Wipro's trademark ‘Chandrika’ and that the colour combination, writing style and design used by the appellants also had close resemblance and amounted to infringement of Wipro’s trade mark. The Court below was also of the view that both products are of the same category and class, and the appellants' use of the trademark 'Chandra' would thus create confusion in the minds of ordinary consumers, and accordingly, restrained them from marketing products with the said trademark. 

The counsel for the appellants averred that since both the appellant and the respondent had valid registration for their respective trade marks, no injunction should have been ordered by the court below. It was added that the plea that Wipro obtained registration on an earlier point of time cannot be a ground for seeking an order of injunction alleging infringement of their trademark, when a registrant is vested with the right to use their registered trademark in relation to goods and services. 

Advocate R. Sanjith argued on behalf of Wipro that the company had been marketing 'Chandrika' since 1940, and the appellants could not pass of their products on the strength of the registration of trade mark they had only recently obtained, and the issuance of which in itself was illegal.

The Court noted that Wipro was marketing ayurvedic soaps under the trademark 'Chandrika', while the appellants were marketing washing soap and other products essentially used for washing clothes under the trademark 'Chandra'.

Findings of the Court

Whether Respondents Can Claim Prohibitory Injunction When Both Parties Had Valid Trade Mark Registration For Respective Products

The Court was posed with the question as to whether the respondents have the right to claim a prohibitory injunction against the appellants, considering that both had valid trade mark registration for their respective products. The Court relied upon the decision in S. Syed Mohideen v. P. Sulochana Bai(2016), wherein it had been laid down by the Apex Court that an owner of a registered trademark cannot sue for infringement of his registered trademark if the opposite party also has the trade mark which is registered, thereby answering the question in the negative. 

"In such a case the person who obtained registration of a trade mark at an earlier point in time is not remediless. He can certainly approach the Registrar or the High Court, as the case may be, for rectification or cancellation of the offending trade mark invoking the provisions contained in Chapter VII of the Trade Marks Act," Court said.

Whether Respondents Can Claim Relief Based On 'Passing Off'

The Court was quick to note that S. Syed Mohideen (2016) had also laid down that the rights granted by the registration in the form of exclusivity are not absolute but are subject to the provisions of the Act. On this basis, the Court embarked on the question as to whether the respondents would be entitled to claim relief based on the alleged passing off by the appellants. 

The Court observed that in order to establish 'passing off', the following three elements would have to be established: 

i. Goodwill of Chandrika

The Court was of the view that there was no doubt as regards the 'Goodwill' of Wipro's product 'Chandrika'.

"Their claim that they got pan India registration in 1976 and their products could garner immense goodwill and reputation among the customers is prima facie evident from the data furnished by them. Not only the brand name 'Chandrika', but its labels and packaging also have trade mark registration and all of them have a distinct appearance and acceptance in the market," the Court observed. 

ii. Whether Appellants' Marketing of 'Chandra' Amounts to Misrepresentation of 'Chandrika'

The Court took note of the District Court's view that the label, the colour combination, writing style and design on the labels used by the appellants was deceptively similar to that used by Wipro. The High Court found no ground to interfere with the said observation and affirmed that the appellants' marketing of their products would amount to misrepresentation of the products of the respondents. 

iii. Damage to Goodwill of 'Chandrika'

The Court observed that although the products of both parties came under class 3 of the Schedule of products under the Trade Marks Rules, the purpose of the products was different. It further noted that the appellants started marketing their products in the year 2020. 

It perused the market share of Wipro's products in the successive years, and was of the considered opinion that it did not suffer any notable diminution after 2020, in which year the appellant had started to market their products.

The Court observed that despite the appellant's marketing their products, Wipro had not sustained any economic loss or damage, nor had their market share been affected.

"In that view of the matter, it cannot be said that the third element to attract a passing off action is not established by the respondents. Therefore, the respondents are not entitled to get an order of injunction based on the allegations of passing off," the Court held. 

The appeal was thus allowed. 

The appellants were represented by Advocates M. Gopikrishnan Nambiar, K. John Mathai, Joson Manavalan, Kuryan Thomas, Paulose C. Abraham, and Raja Kannan. 

Case Title: M/S Mariyas Soaps and Chemicals & Anr. v. M/S Wipro Enterprises Ltd. & Anr. 

Citation: 2023 LiveLaw (Ker) 357 

Case Number: F.A.O. NO. 48 OF 2023

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