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TMI Blog1996 (12) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... anipal Industries Limited, Manipal (4) Manipal Finance Corporation Ltd., Manipal; (5) Manipal Sowbhaghya Nidhi Limited, Manipal; (6) Mani-pal Prakashana (P.) Ltd. R. Manipal; (7) Manipal Printers and Publishers (P.) Ltd., Manipal; (8) Manipal Hotels Limited, Madras; (9) Manipal Fibres Limited, Madras, and (10) Industrial Credit and Development Syndicate Ltd., Manipal. Defendant No. 2 in all these suits is T. Ramesh Pai, defendant No. 3, is T. Sudhakar Pai and defendant No. 4 is T. Shantharam Pai. The reliefs sought in these suits are : (1) for a permanent injunction restraining defendant No. 1 by themselves their servants, agents or any one claiming through them from passing off their business as the business of the plaintiffs by using the expression "Manipal" phonetically or deceptively similar to it either as part of their corporate name or using the same otherwise in the course of their business or any advertisement effected by them in any media; (2) for a permanent injunction restraining defendants Nos. 2 to 4 by themselves, their servants, agents or any one claiming through them from announcing and publicising themselves and their companies and concerns as part of the Mani ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by Dr. T.M.A. Pai in 1930's, namely, Canara Land Investments Limited, which bought 107 acres. Another 13 acres was acquired by Dr. T.M.A. Pai and it is now the town centre. The first building constructed thereon was a Tuberculosis Sanatorium, established by Dr. Pai. A factory was put up in 1935, and in the course of the succeeding decades, it became a centre of industry, finance, education and medical service. The plaintiffs have given a list of fifteen commercial concerns established by the Pai family. Of the fifteen, nine companies have the name "Manipal" as part of their corporate name. The other six bear such names as Industrial Credit and Development Syndicate Bank Ltd.; Maharashtra Apex Corporation Ltd.; Canara Steels Limited; Karnataka Consumer Products; Chitrakala Investments, and Searock Investment. A list of six firms belonging to the family has also been set. The firms have "Manipal" as part of their firm name. A large number of education and medical colleges have also been established by the family or by the trust founded by the family. A list of twelve educational institutions have been set out and they include the Kasthurba Medical College, Dental, Pharmaceutical an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry meaning in the law of passing off. After the demise of Dr. T. Madhava Pai, the mantle of leadership of the companies, firms and institutions fell on T.A. Pai, the elder brother of the second defendant, who was the head of many institutions. After the demise of T.A. Pai in the year 1981, the leadership was shared by T. Mohandass Pai, the eldest son of Dr. T. Madhava Pai and by the second defendant. In the course of years, friction had developed between the two cousins and their branches and being unwilling to go to a court to have the disputes settled, they sought the intervention of common friends for advice, guidance and arbitration. Such common friends were Mr. Virendra Heggade, Dharmadhikari of Dharmashala, a respected religious leader, Mr. Dhirubai Ambani of the Reliance group of companies, an eminent industrialist and C. Subramaniam, former Union Minister of Union of India and the Governor of Maharashtra. The parties reached-an understanding at the instance of Dhirubai Ambani, on November 4, 1993. A press release was made under the signatures of the second defendant on behalf of his group and by three of the five sons of the late Dr. T.M.A. Pai. The understanding so r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l" by the companies and firms under the control of the Mohandas Pai group. The defendants, it is alleged, are also claiming to be the "Manipal group". The defendants have described these three companies along with the companies which were allotted to them under the Ambani accord as forming part of the "Manipal group of companies" in the invitation issued by them to celebrate the birth centenary of the father of the second defendant. The plaintiffs have averred that in the Indian Express, Bangalore edition, a new item was published at the instance of the second defendant, stating that Maharashtra Apex Corporation Limited and the Manipal group had received clearance from the Securities and Exchange Board of India for starting mutual fund operations through an asset management arm. The group chief is referred to as T. Ramesh Pai. The plaintiffs have alleged that it is this circumstance which has prompted and made it absolutely necessary for the plaintiffs to approach the court for relief against the grave adverse consequences of the conduct of the defendants on the commercial rights of the plaintiffs. The plaintiffs have averred that the plaintiffs' have acquired enormous goodwi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r by Mr. Ambani or by C. Subramaniam. It is also pointed out that none of the three jewels in the crown which made the name of the Pais famous ICDS Limited, Dr. T.M.A. Pai Foundation and Academy of General Education had the prefix "Manipal". Even according to the plaintiffs, the flagship companies of the group were of ICDS Limited and Maharashtra Apex Corporation Limited, both of which do not carry the word "Manipal" as part of their corporate name. The deponent of the affidavit has claimed that he has contributed a great deal to the development of the companies presently in the Mohandas Pai group. It is also the case of the defendants that the companies under the control of the second defendant, Ramesh Pai, were called "the Manipal group" even before the disputes arose and the three companies, Manipal Housing Finance Syndicate, Manipal Finance Corporation Limited and Manipal Sowbhagya Nidhi Limited, were described as the Manipal Finance group. It is only the Manipal Finance group which is now under the control of the Mohandas Pai group. ICDS it is stated by the defendants was never described or called as part of the Manipal group but was described as the ICDS group. The defendants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e names of cities, towns or villages cannot become the proprietary word for any particular family or individual or group. It is also the case of the defendants that the earliest company founded by the Pai family, namely, Maharashtra Apex Corporation Limited, which is allotted to the Ramesh Pai group had also been described throughout as a company belonging to the Manipal group. The deponent of the counter-affidavit Mr. Ramesh Pai has averred that he has been active in both business and social work including education for well over a period of 40 years and has been a director of several well known business enterprises and voluntary associations. He has averred that in view of his standing, the public at large have welcomed the establishment of these companies and there is no confusion in the minds of the public. He has also denied the allegation that he started new companies with intent to create confusion or chaos of identities and to divert the business of the plaintiffs. He has asserted that what was being done by the defendants is only starting or continuing legitimate business activities. He has also asserted that he being a member of the Manipal group, it cannot be denied by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the manner now sought to be done by the plaintiffs; that as a matter of fact, defendant No. 2 had contributed a great deal to the establishment and development of the companies, being at present the seniormost member of the Pai family; that he had a close and intimate link with the family which established these companies and also with the town in which they were established; that he had a right to incorporate new companies under names which included the name of the town "Manipal"; that there was no scope for confusion as the activities of the new companies are not identical to those of the plaintiff-companies and even if there be any overlapping, it would not justify the grant of any injunction. Counsel also pointed out that the two companies of the Pai family, ICDS and Maharashtra Apex Corporation Limited do not include the name "Manipal" and they in fact carry on business which is similar and that did not come in the way of both companies growing and flourishing. It was submitted that the defendants have not traded upon the goodwill of the plaintiffs and the fact that the companies have the name "Manipal" by itself would not mislead a prospective customer into mistaking one com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion caused in the public mind or in other words by reason of the public being deceived by the use of such name." ( d ) Nilgiris Dairy Farm v. S.A. Rathnasabapathy [1975] 2 Kar LJ 505. A Division Bench of the Karnataka High Court in that case which arose out of the use by the defendants of an identical firm name used by the plain tiff in relation to identical business, held that though the word "Nilgiris" was a geographical name, as the name, "Nilgiris Dairy Farm" had become a trade name to the extent necessary to maintain an action for passing off, and as the plaintiff had acquired a valuable reputation, the court would restrain the unauthorised use of that name and mark in a manner calculated to deceive the public and cause damage to the plaintiff. ( e ) Ellora Industries v. Banarasi Dass Goela, AIR 1980 Delhi 254. A learned single judge of the High Court at Delhi held in that case (headnote): "The purpose of tort of passing off is to protect commercial goodwill ; to ensure that people's business reputations are not exploited ... It is thus complementary to trade mark law which is founded upon statute rather than common law . . . the onus in a passing off action lie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntari Overseas Ltd. v. Montari Industries Ltd. [1996] PTC 16, in which a Division Bench on an appeal from the judgment of the learned single judge, while affirming the injunction, noticed the following passage in the case of Guardian Fire and Life Assurance Co. v. Guardian and General Insurance Co. Ltd. [1880] 50 LJ Ch. 253, wherein Sir George Jessel observed: "The public are careless and it is no use supposing that if they paid a very moderate attention to names they would see they were not the same but only similar". The court rejected the submission on that because of the word "overseas" is also a part of the corporate name in addition to Montari, the names of two companies are not identical. ( j ) Kirloshar Diesel Recon. Pvt. Ltd. v. Kirloskar Proprietary Ltd., AIR 1996 Bom 149, that was a case where the defendant in the suit had registered companies with the name of Kirloskar and asserted a right to do so on the ground that his name was Kirloskar. The learned single judge, finding for the plaintiff, held that the "incorporation" of the defendant's companies with the word "Kirloskar" was very recent, whereas the existence of the plaintiff's business belonging to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to the following passage from Halsbury's Laws of England, 4th edition, volume 48 at para. 159: "159. Shared reputations . In order to maintain an action for passing off a plaintiff need not be the only person entitled to make use of a particular mark or name. Thus, where the goodwill connected with the use of a trade name originally used in a single business is divided between different persons, each of those persons has an independent right to sue a third person for passing off by use of the trade name." Learned counsel for the defendants relied upon the following decisions: ( a ) Asiatic Government Security Life Assurance Co. Ltd. v. New Asiatic Insurance Co. Ltd. [1939] 9 Comp Cas 208 ; AIR 1939 Mad 555, wherein a learned single judge of this court held that the use of the defendant's name was not calculated to deceive and to divert business from plaintiffs to defendants or to cause confusion between the two companies and the plaintiffs were not entitled to an injunction, as it is not sufficient to show that there is similarity of names but it must also be shown that there is a reasonable probability that the use of the name would result in the defendant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arge that onus. It was, however, found that the name used by the defendant amounted to infringement of the registered trade mark "Pristacin". The learned judge in the course of the judgment observed that they have to establish of course that "Bristol" which is a name and not a surname, but also better known as the name of a large city in this country, has acquired a secondary meaning so that, when applied to pharmaceutical products, it denotes those of plaintiffs. There is clearly in such a case a very heavy onus of proof on the plaintiffs who seek to establish the secondary meaning. ( f ) Unitex Limited v. Union Texturing Co. Ltd. [1973] 6 RPC 119 a decision of the court of appeal. The court held that "looking at the case as a whole, it does not seem to me at this stage that on the evidence before me there is any real tangible risk of damage by the use of the mark 'Unitex' by the defendant who was a sub-contractor of the plaintiff". ( g ) Teju Singh v. Shanta Devi, AIR 1974 AP 274, a decision of the Division Bench of the Andhra High Court. The court held that the same principles which are applied in the case of an action for passing off of goods are to be applied in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated. ( j ) Simuatul Chemical Industries Pvt. Ltd. v. Cibatul Ltd., AIR 1978 Guj 216. A Division Bench of the Gujarat High Court in that case held that "where a company (manufacturer) complains that its customers are likely to be confused by similarities in the name of his company and another company that has started production subsequently, it is not necessary for the plaintiff to show that the words in the names of rival companies are identical. The plaintiff does not set out to establish that it is a question of the user of an identical name. The plaintiff simply undertakes to show that the two names are so deceptively similar that there is a likelihood of confusion amongst the persons dealing with two companies." ( k ) R.S.K.V. Raghavan Trading as R.S. Krishna and Co., Mayuram v. G. R. Gopal and Co., AIR 1981 Mad 262. Ramanujam J. who decided that case had held that the use of the name of the word "Thennamarakudi" by the applicant for its medicinal oil, would not entitle to it to seek rectification of the respondent's registered trade mark which contains the word "Thennamarakudi Oil" as "Thennamarakudi" was a place and the use of that name for the oil manufacturers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e permitted to deny that knowingly or unknowingly he has allowed or encouraged another to do that against which the plaintiff subsequently complains. ( n ) Mohan Lak Khatri v. Khati Bidi Works [1984] PTC 226, the learned single judge held that as the plaintiff and defendant were the descendants of the common ancestor and the defendants were found to have been selling the bidis under an assumed trade mark since 1966, it was not a fit case for granting interim injunction. ( o ) Moorgate Tobacco Co. Ltd. v. Philip Monies Ltd. [1985] RPC No. 10, page 219 a decision of the High Court of Australia at Canberra. The issue in that case was the right of the prior user of the word "Kent Golden Lights" as trade mark in relation to cigarettes. The court found therein that there had been no general tort known to the law of Australia. The fact that it was not sufficient to disentitle the rival applicant from registering the trade mark in Australia. It was also stated therein that in Australian law, there is no tort of unfair competition. ( p ) S.K.G. Khosla Compressors Ltd. v. Khosla Extraktions Ltd. [1983] PTC 211. It was held in that case that the action for passing off would li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd "Micro" is a common and general name descriptive of the products which are sold or of the technology by which the products are manufactured and as such the users of the products are not likely to be misguided or confused in view of the facts that the words "tel" and "nix" in the trade names of the appellant and respondents are phonetically totally dissimilar. ( v ) First Computers formerly known as Brilliant's Computers Centre, Madras v. A. Guruprasad [1995] 2 LW 486. A Division Bench of this court held that the word "first computer" is a common property of all and the user of the word "first computer" by the appellant in his business did not amount to passing off which business is similar to that of the respondent who was trading in computers. ( w ) Payton and Co. Ltd. v. Snelling Lampared and Co. Ltd. 17 Reports of Patent Design and Trade Mark Cases 628. The House of Lords in that case declined to grant injunction in favour of the trader who sold their coffee in circular tins surrounded by paper labels in red and blue. The label on the plaintiff's tins contain the brand "royal" while that of the defendant's also with the same colour used the brand name in black. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... city like Madras, there are several large companies well known nationally who use the name of the city as part of their corporate name. Geographical names are invariably and subject to rare exceptions public juris are in the public realm available for use by any one choosing to adopt it as part of the name of the business enterprise. Any exception to this rule must truly be an exception. It is only in a rare case where the name has been used very extensively for a long period, is so well known in the market as to be identified in the public mind with the product or service rendered by the business enterprise, that the court may consider granting injunctive relief to a plaintiff. The case pleaded by the plaintiffs even when considered de hors the case pleaded by the defendants, does not warrant the grant of any injunctive relief to the plaintiffs. "Manipal" is the name, according to the plaintiffs of a well known town which is an industrial, commercial, educational and financial centre, and is located in the State of Karnataka in South India. The town has a large number of educational institutions and is known internationally for their quality, particularly in the field of me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e its links with "Manipal" or even the region in which that town is situated. The name of that company "Maharashtra Apex Corporation Limited" indicated possible links with the region of Maharashtra and the Marathi language and did not indicate any association with the city of "Manipal" or the language spoken in that region. The plaintiffs have failed to make out a prima facie case that "Manipal" as part of the corporate names of plaintiffs Nos. 1 to 6 had acquired extensive goodwill and had acquired a secondary meaning as referring exclusively to the plaintiff companies. The defendants have also shown that "Manipal" has been used as part of the name of more than one business enterprise in Manipal. The fact that those enterprises are proprietary or partnership firms is not of significance while considering the plaintiff's claim to exclusive commercial user of that name. Merely by using "Manipal" as part of the corporate name of the companies incorporated by defendants, the names of those companies cannot be said to be identical or so closely resembling the name of plaintiffs Nos. 1 to 9, as to mislead, cause confusion, or result in unfair exploitation of the goodwill earned by p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion for a passing off action. Breach of contract if any can in the circumstances only give rise to a claim for damages. "Manipal" has been associated even in the perception of the plaintiffs more with the Pai family, than to any particular corporate entity. Mohan Das Pai as also Ramesh Pai when they issued a press release after the Ambani accord, on November 4, 1993, described it as having been issued by the "Pais of Manipal". The first sentence of that press release was : "In public perception the Manipal Pais are regarded not merely as a business family but also as trustees of a great heritage". The statement signed by the heads of the two groups repeatedly refers to "Manipal Pais" and "Pais of Manipal". The award of Sri C. Subramaniam refers to "Manipal Pais" dispute and "Manipal Pai family". The Manipal group, prior to the split referred to all companies and firms founded by the Manipal Pai family, and not exclusively to the plaintiff companies. "The Manipal Finance Group" as distinct from the "Manipal group" referred to three of the plaintiffs and was allotted to the Mohandas Pai group under the Ambani accord. They had been described and referred to, even prior to the divi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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