2003 (4) TMI 613 - HC - Indian Laws

Summary

Issues Involved:
1. Maintainability of the suit by the Court Receiver for infringement of a registered trademark.
2. Entitlement to an injunction against passing-off despite cessation of business.
3. Deceptive similarity between the trademarks "Mastaan" and "Mastaan," and "Postman" and "Postiano."
4. Vulnerability of the trademark registrations due to non-use.
5. Balance of convenience and likelihood of damage to the plaintiff.

Detailed Analysis:

1. Maintainability of the Suit by the Court Receiver:
The primary issue was whether the Court Receiver could maintain a suit for trademark infringement. The defendant argued that only the registered proprietor could file such a suit, citing Section 28 of the Trade and Merchandise Marks Act, 1958. However, the court held that a Receiver, appointed under Section 94 and Order 40 Rule 1 of the Code of Civil Procedure, 1908, has all the powers of the owner, including the power to bring suits for the protection of the property. The court emphasized that the Receiver stands in the shoes of the owner and is entitled to do all acts necessary for preserving and protecting the property, including trademarks.

2. Entitlement to an Injunction Against Passing-Off:
The court examined whether the plaintiff could seek an injunction against passing-off despite the cessation of business. It was noted that the partnership firm had a long-standing reputation for its trademarks "Mastaan" and "Postman," which had been used for decades. The court found that the goodwill associated with these trademarks persisted even after the dissolution of the firm, as per Sections 53 and 55 of the Indian Partnership Act, 1932. It was held that goodwill does not extinguish immediately upon cessation of business and can be protected in a passing-off action if it still exists.

3. Deceptive Similarity:
The court analyzed the trademarks "Mastaan" and "Mastaan," and "Postman" and "Postiano" for deceptive similarity. It was found that "Mastaan" and "Mastaan" had phonetic similarities and similar visual elements, leading to a likelihood of confusion. Similarly, "Postman" and "Postiano" were found to have visual and phonetic similarities that could deceive consumers. The court held that these similarities were sufficient to grant an injunction on the grounds of both passing-off and infringement.

4. Vulnerability of Trademark Registrations:
The defendant argued that the trademarks had become vulnerable due to non-use, as required by Section 24 of the Trade Marks Act. However, the court refused to consider the validity of the trademark registrations at this interlocutory stage, citing Section 31 of the Trade and Merchandise Marks Act, which provides that registration is prima facie evidence of validity. The court emphasized that while the marks remain registered, it is undesirable for others to imitate them.

5. Balance of Convenience and Likelihood of Damage:
The court considered the balance of convenience and the likelihood of damage to the plaintiff. It was noted that the plaintiff's trademarks had acquired significant reputation over 50 years, and their value would be diminished by the defendant's use of deceptively similar marks. The court held that the plaintiff was likely to suffer substantial damage and that the balance of convenience favored granting an injunction to protect the trademarks until they could be sold or assigned in the dissolution process.

Conclusion:
The court allowed the Notice of Motion, granting an injunction against the defendants from using the trademarks "Mastaan" and "Postiano," finding them deceptively similar to the plaintiff's trademarks "Mastaan" and "Postman." The court also stayed the order until a specified date, considering the plaintiff's current non-operation in business.