1962 (4) TMI 65 - SC - Companies Law

Whether the name Lakshmandhara was likely to deceive the public or cause confusion to trade within the meaning of s. 8 and s. 10 (1) of the Act? Whether there was such acquiescence on behalf of the appellant in the use of the name Lakshmandhara in the. State of Uttar Pradesh as to bring it within the, expression special circumstances mentioned in sub-s. 10 of the Act? Held that - Appeal allowed. There was any fraudulent user by the respondent of his trade name Lakshmandbara . The name was first used in 1923 in a small way in Uttar Pradesh. Later it was more extensively used and in the same journals the two trade marks were publicised. The finding of the Registrar is that the appellant and its agent were well aware of the advertisements of the respondent, and the appellant stood by and allowed the respondent to develop his business till it grew from a small beginning in 1923 to an annual turnover of Rs. 43,000/- in 1946. These circumstances establish the plea of acquiescence and bring the case within sub-s. (2) of s. 10, and in view of the admission made on behalf of the respondent that his goods were sold mainly in Uttar Pradesh, the Registrar was right in imposing the limitation which he imposed.

Summary

Issues Involved:
1. Whether the name 'Lakshmandhara' was likely to deceive the public or cause confusion within the meaning of Section 8 and Section 10(1) of the Trade Marks Act, 1940.
2. Whether there was acquiescence on the part of the appellant in the use of the name 'Lakshmandhara' in Uttar Pradesh, bringing it within the expression 'special circumstances' mentioned in Section 10(2) of the Trade Marks Act, 1940.

Detailed Analysis:

1. Likelihood of Deception or Confusion:
The first issue revolves around whether the trade name 'Lakshmandhara' was likely to deceive the public or cause confusion with the already registered trade name 'Amritdhara'. The appellant argued that 'Lakshmandhara' closely resembled 'Amritdhara', both phonetically and structurally, and could mislead consumers. The respondent countered that the names were distinct enough not to cause any confusion.

The Registrar of Trade Marks initially found that 'Lakshmandhara' closely resembled 'Amritdhara' and was likely to deceive or cause confusion, especially considering both names were used for similar medicinal products. The High Court, however, disagreed, stating that the words 'Amrit' and 'dhara' were common in the Hindi language and their combination into 'Amritdhara' could not monopolize these common words. The High Court also noted that the phonetic differences between 'Amritdhara' and 'Lakshmandhara' were significant enough to avoid confusion.

Upon appeal, the Supreme Court emphasized that the key test was whether an average consumer with imperfect recollection would be deceived by the overall similarity of the two names. The Court concluded that the structural and phonetic similarity of 'Amritdhara' and 'Lakshmandhara' was likely to cause confusion among consumers, especially given the nature of the products and the target market, which included both literate and illiterate individuals. The Supreme Court thus found the High Court's reasoning flawed and upheld the Registrar's initial finding.

2. Acquiescence:
The second issue was whether the appellant had acquiesced to the use of the name 'Lakshmandhara' by the respondent, thereby allowing its registration under 'special circumstances' as per Section 10(2) of the Act. The respondent argued that they had been using the name 'Lakshmandhara' honestly and concurrently since 1923 without any objection from the appellant, which constituted acquiescence.

The Registrar found that the appellant had indeed acquiesced, as they did not object to the use of 'Lakshmandhara' despite being aware of its advertisement and sale in the same journals as 'Amritdhara'. The High Court, however, did not find sufficient evidence of acquiescence, stating that mere concurrent advertisement did not imply the appellant's awareness or acceptance of 'Lakshmandhara'.

The Supreme Court, agreeing with the Registrar, noted that the appellant's inaction over a significant period allowed the respondent to build a substantial business under the name 'Lakshmandhara'. This inaction constituted acquiescence, bringing the case within the 'special circumstances' of Section 10(2). However, considering the respondent's admission that their sales were primarily in Uttar Pradesh, the Supreme Court upheld the Registrar's decision to limit the registration to that state.

Conclusion:
The Supreme Court allowed the appeal, set aside the High Court's judgment, and restored the Registrar of Trade Marks' order. The name 'Lakshmandhara' was found likely to cause confusion with 'Amritdhara', and the appellant's acquiescence justified the limited registration for Uttar Pradesh. The appeal was allowed with no order as to costs.