Trademark Dispute: Uto Nederland B.V. v. Tilaknagar Industries Ltd.
The dispute arises between Uto Nederland B.V., a Dutch entity, and Tilaknagar Industries Ltd., an Indian spirits manufacturer, over the trademarks ‘MANSION HOUSE’ and ‘SAVOY CLUB’. At the heart of the conflict lies the question of whether a conditional ceding of these marks in 1987 resulted in a permanent transfer of ownership to Tilaknagar or whether the trademarks automatically reverted to UTO upon breach of conditions as stipulated in the ceding arrangement.
The High Court of Bombay’s Commercial Appellate Division, in a detailed judgment delivered on 16 July 2025, adjudicated upon this multifaceted controversy, examining the doctrines of passing off, transborder reputation, and the impact of Section 31 of the Transfer of Property Act, 1882 on trademark ownership.
Factual Background
UTO Nederland B.V. and its group companies are Dutch entities engaged in the global manufacture and distribution of alcoholic beverages. UTO originally registered the trademark ‘MANSION HOUSE’ in the Netherlands in 1922 and ‘SAVOY CLUB’ in 1967, and subsequently obtained registration in multiple jurisdictions, including India.
On 7 July 1983, UTO entered into a License and Manufacturing Agreement with Tilaknagar Industries Ltd. (Tilaknagar) for the manufacture and sale of liquor under the said trademarks in India, on the condition that Tilaknagar would procure specified quantities of concentrates from UTO.
In February 1987, following litigation between UTO and the Scotch Whisky Association in the Netherlands regarding misleading use of the term “Scotch”, UTO conditionally ceded the trademarks to Tilaknagar via two interlinked letters dated 23 February 1987. The cession was subject to Tilaknagar’s continued compliance with procurement obligations, failing which the trademarks would revert to UTO. Although Tilaknagar continued to use the trademarks, it stopped procuring concentrates from UTO by 1994, and began using self-developed substitutes.
Procedural Background
UTO initiated Commercial Suit No. 2 of 2009 (originally Suit No. 632 of 2009) before the High Court of Bombay, seeking a permanent injunction against Tilaknagar for passing off and infringement of copyright in the artistic works associated with the trademarks. The suit also sought cancellation of registrations obtained by Tilaknagar and damages. UTO filed Notice of Motion No. 993 of 2009 for interim relief, which was dismissed by a Single Judge on 22 December 2011. UTO preferred Commercial Appeal No. 66 of 2012. In response, Tilaknagar filed Cross Objection No. 3 of 2012 disputing UTO’s transborder reputation.
In parallel, Tilaknagar filed Counterclaim No. 6 of 2010 with Notice of Motion No. 1287 of 2010 seeking to restrain UTO. In 2014, UTO transferred part of its rights to Allied Blenders and Distillers (ABD), who moved Interim Application No. 16999 of 2023 for permission to introduce products under the trademark.
By order dated 7 February 2025, a Single Judge rejected Tilaknagar’s motion and allowed ABD’s application. Tilaknagar filed Commercial Appeal (L) Nos. 6617 and 6622 of 2025. All appeals were adjudicated together in a common judgment dated 16 July 2025.
Core Dispute
The central controversy revolved around the legal status of the 1987 ceding arrangement and whether the trademarks reverted to UTO upon breach. UTO contended that the ceding was conditional and that breach caused automatic reversion under Section 31 of the Transfer of Property Act.
Conversely, Tilaknagar argued that the transfer was absolute, breach only gave rise to damages, and UTO had waived any condition through inaction and acquiescence.
Discussion on Judgments
UTO relied on:
- Nagindas Ramdas v. Dalpatram Ichharam, (1974) 1 SCC 242
- Indu Kakkar v. Haryana State Industrial Development Corp., (1999) 2 SCC 37
- Harichand & Co. v. Gosho Kabushiki Kaisha, (1925) ILR 49 Bom 25
- N.R. Dongre v. Whirlpool Corporation, (1996) 5 SCC 714
- Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd., (2018) 2 SCC 1
Tilaknagar relied on:
- Madanlal Fakirchand Dudhediya v. Shree Changdeo Sugar Mills Ltd., 1962 (3) SCR 973
- Devendra Prasad Sukul v. Surendra Prasad Sukul, 1935 SCC OnLine PC 54
- Amritdhara Pharmacy v. Satya Deo Gupta, 1962 SCC OnLine SC 13
- Ramdev Food Products v. Arvindbhai Rambhai Patel, (2006) 8 SCC 726
Reasoning and Analysis of the Judge
The Division Bench concluded that the two 1987 letters were part of a composite transaction. The second letter clearly stipulated reversion if procurement failed. The Court held that Section 31 permits such superadded conditions and automatic reversion upon breach.
Although the Court noted delay in UTO’s action, it found that correspondence and continuous assertion of ownership by UTO countered the claim of waiver or abandonment. The Court reaffirmed the right to protect a mark with transborder reputation even without local sales.
It also held that the 2011 judgment inadequately addressed the reversion issue, while the 2025 judgment correctly favored UTO and ABD.
Final Decision
The Court:
- Allowed Commercial Appeal No. 66 of 2012
- Set aside the 22 December 2011 order
- Granted interim injunction against Tilaknagar
- Upheld 7 February 2025 order in favor of ABD
- Dismissed Tilaknagar’s Commercial Appeals (L) No. 6617 and 6622 of 2025
Law Settled in This Case
- Conditional transfer of trademark rights can result in automatic reversion upon breach, without a separate suit.
- Passing off claims can be maintained by foreign proprietors with transborder reputation even without local presence.
- Long delays do not amount to waiver if rights are consistently asserted and there’s no detrimental reliance.
- Section 31 of the Transfer of Property Act applies to intellectual property and can operate as a defeasance clause.
Case Information
- Case Title: Uto Nederland B.V. & Anr. v. Tilaknagar Industries Ltd. & Ors.
- Date of Order: 16 July 2025
- Case Number: Commercial Appeal No. 66 of 2012
- Neutral Citation: 2025:BHC-OS:10958-DB
- Name of Court: High Court of Bombay
- Judges: Hon’ble Chief Justice Alok Aradhe and Hon’ble Mr. Justice Sandeep V. Marne
Disclaimer:The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.
Written By: Advocate Ajay Amitabh Suman, IP Adjutor – Patent and Trademark Attorney
Email: [email protected], Ph no: 9990389539
