Om Prakash Gupta vs. Parveen Kumar and Anr.
Date of Order: May 19, 2000
Case No.: Suit No. 1744/99
Neutral Citation: 86 (2000) DLT 181
Court: High Court of Delhi
Judge: Hon’ble Mr. Justice J.B. Goel
Summary
This dispute revolves around the trademark “SURAJ CHHAP,” a label tied to the tobacco trade, and pits Om Prakash Gupta, claiming registered proprietorship, against Parveen Kumar and another, who challenge the plaintiff’s assertions with a tale of prior use and alleged deceit. The High Court’s ruling not only vacates an interim injunction but dismisses the suit entirely, spotlighting the sanctity of judicial processes and the fragility of trademark rights in the face of non-use and fraud.
Detailed Factual Background
Om Prakash Gupta, the plaintiff, asserts ownership of the trademark “SURAJ CHHAP,” registered under number 287631 on April 24, 1973, in Class 34 for scented chewing tobacco. Initially, Gupta operated as part of a partnership firm, M/s. Prakash Sugandh Bhandar, alongside Sumer Chand and Promod Kumar, starting in 1973. Over time, one partner retired, another passed away, and Gupta became the sole proprietor. He claims extensive use of “SURAJ CHHAP” across states like Delhi, Rajasthan, Uttar Pradesh, Gujarat, and Madhya Pradesh since 1973, building a robust reputation. Gupta also asserts copyright in the artistic design of his product labels and pouches, characterized by a distinctive trade dress and color scheme, and invokes common law rights against passing off due to long-term use. However, he admits to a period of non-use—without specifying its duration—before resuming business in 1999.
The defendants, Parveen Kumar and another, counter that they have been in the tobacco trade since 1956, initially using trademarks “PATANGA” and “HARIBIHARI.” They claim to have adopted “SURAJ CHHAP” for unmanufactured raw tobacco in 1993 (later contested as 1995 due to excise licensing), with significant sales figures: ₹10,62,257.50 in 1993–94 escalating to ₹17,66,250 in 1998–99. They assert a copyright registration for “SUN BRAND” Hukka Tobacco since May 10, 1976, and argue that their pouches differ from Gupta’s. The defendants allege that Gupta’s tobacco business faltered by 1979, leading to abandonment of “SURAJ CHHAP,” and that his 1999 resumption was a belated attempt to capitalize on their established market presence. They further contend that Gupta’s trademark registration carries a disclaimer excluding exclusive rights to “SURAJ” and the “Sun” device, a fact he allegedly concealed.
Detailed Procedural Background
Gupta filed Suit No. 1744/99 in the High Court of Delhi, seeking a permanent injunction against the defendants for trademark infringement, copyright infringement, and passing off, alongside ancillary reliefs. Concurrently, he moved I.A. No. 7665/99 under Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908 (CPC), for a temporary injunction. On August 12, 1999, the court granted an ex parte interim injunction, restraining the defendants from using “SURAJ CHHAP” or similar labels, based on Gupta’s claims of registered trademark rights, as recorded on August 10 and 12, 1999.
The defendants responded with I.A. No. 8739/99 under Order 39 Rule 4, CPC, seeking to vacate the injunction, alleging misrepresentation and prior use. They did not file a written statement but presented detailed facts in their application. Both parties submitted extensive documentation and written arguments, supplemented by lengthy oral submissions. Justice J.B. Goel adjudicated the applications together, delivering a comprehensive judgment on May 19, 2000, which not only addressed the injunction but also disposed of the suit itself.
Issues Involved in the Case
- Whether Gupta’s suit for trademark infringement is maintainable given the disclaimer on “SURAJ” and the “Sun” device.
- Whether his concealment of this disclaimer constitutes fraud sufficient to warrant dismissal.
- Whether prolonged non-use of “SURAJ CHHAP” amounts to abandonment, extinguishing his rights.
- Whether the defendants’ prior use since 1993 (or 1995) establishes superior rights.
- Whether Gupta’s passing off claim survives despite the disclaimer and non-use.
Detailed Submission of Parties
Plaintiff: Gupta’s counsel argued registration under No. 287631 entitles him to sue for infringement under Section 28 of the Trade and Merchandise Marks Act, 1958. He emphasized extensive use since 1973, claimed goodwill, and asserted copyright. On non-use, he cited partner’s death as cause, and defended his common law rights for passing off despite the disclaimer.
Defendants: Their counsel cited the registration certificate’s disclaimer and alleged suppression of this fact by Gupta. They argued prior use since 1993 supported by sales data, claimed Gupta had abandoned the mark, and contested similarities in packaging. They urged for dismissal based on Gupta’s conduct and their established market presence.
Detailed Discussion on Judgments Cited
- Chandra Shashi v. Anil Kumar Verma (1995) 1 SCC 421: On fabrication and contempt; cited for judicial integrity and fraud consequences.
- Indian Bank v. Satyam Fibres (1996) 5 SCC 550: On setting aside orders obtained by fraud using inherent powers.
- S.P. Chengalvaraya Naidu v. Jagannath (1994) 1 SCC 1: Declared judgments obtained by fraud as nullities; emphasized clean hands doctrine.
- Registrar of Trade Marks v. Ashok Chandra Rakhit (AIR 1955 SC 558): Explained the effect of trademark disclaimers.
- Wander Ltd. v. Antox India P. Ltd. (1990 Supp SCC 727): Distinguished between infringement and passing off.
- Polson Ltd. v. Polson Dairy Ltd. (1996) 16 PTC 709: Non-use not abandonment if justified.
- Avis International Ltd. v. Avi Footwear Industries (AIR 1991 Del 22): Burden on defendants to prove abandonment.
- Garden Perfume (P) Ltd. v. Anand Soaps: Cited for non-abandonment, but factually distinguished.
- Godfrey Philips India Ltd. v. Girnar Food & Beverages: Supported defendants’ prior use claim.
- Ruston and Hornby Ltd. v. Zamindara Engineering (AIR 1970 SC 1649): Upheld trademark rights but not relevant due to disclaimer.
Detailed Reasoning and Analysis of Judge
The Court found Gupta guilty of suppression and misrepresentation by failing to disclose the disclaimer on “SURAJ” and the “Sun” device. Drawing from precedents on fraud, Justice Goel ruled this vitiates the entire judicial process. Trademark rights under Section 28 were limited due to the disclaimer, and Gupta’s infringement claim collapsed. On passing off, the prolonged non-use since 1979, unexplained until resumption in 1999, amounted to abandonment. The defendants’ use since 1993 (or 1995) established prior rights. Packaging was found to differ, and the balance of convenience did not favor Gupta due to his deceitful conduct.
Final Decision
On May 19, 2000, the High Court allowed the defendants’ I.A. No. 8739/99, vacated the interim injunction dated August 12, 1999, and dismissed Gupta’s I.A. No. 7665/99 and Suit No. 1744/99 with costs of ₹20,000, citing fraud and abandonment.
Law Settled in This Case
- Concealment of material facts like disclaimers constitutes fraud, warranting dismissal under Section 151 CPC.
- Disclaimed trademark elements lack statutory protection under Section 28, limiting infringement claims.
- Passing off remains viable under Section 17’s proviso despite disclaimer.
- Prolonged, unjustified non-use can amount to abandonment and extinguish common law rights, especially against prior users.
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Written By: Advocate Ajay Amitabh Suman, IP Adjutor – Patent and Trademark Attorney
Email: [email protected], Ph no: 9990389539
