IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 24/12/2003 CORAM THE HONOURABLE MR.JUSTICE N.V.BALASUBRAMANIAN and THE HONOURABLE MR.JUSTICE K.P.SIVASUBRAMANIAM O.S.A.No.30 of 2003 and 31 to 37 of 2003 and CMPs.4313 to 4320 of 2003 & VCMPs.5573 to 5576 of 2003 O.S.A.Nos.30 to 33 of 2003: Mrs.J.Zeenath Bivi, proprietrix, M/s.N.V.K.M.Traders, No.207, Poonamallee High Road, Chennai 600 029, rep. by her Power of Attorney holder Mr.J.Zackaria. ... Appellant -Vs- 1. M.Khader Ibrahim 2. M.Raja Mohamed 3. M.Asi Mohamed 4. S.Rahila Bivi 5. A.Zaithoon Bivi 6. S.Mohamed Ismail 7. R.Asha Banu 8. M.Zahira Banu 9. M.Parveen Roja 10.S.Sakkarai Mohamed 11.J.Rahmath 12.S.Raja Rashool 13.M.Roja Mohamed rep. by his son, Mr.R.Noorul Amin ... Respondents O.S.A.Nos.34 to 37 of 2003: Mrs.J.Zeenath Bivi ... Apellant. vs. 1. N.V.K.M.Khader Ibrahim 2. N.V.K.M.Raja Mohamed 3. N.V.K.M.Asi Mohamed 4. N.V.K.M.Roja Mohamed 5. S.Rahila Bivi 6. A.Zaithoon Bivi 7. S.Mohamed Ismail 8. A.Asha Banu 9. M.Zahira Banu 10.M.Parveen Roja 11.S.Sakkarai Mohamed 12.Rahamath Jinnah 13.S.Raja Razhool Mohamed 14.M/s.N.V.K.Mohammed Sultan Rowther & Sons, a firm being rep. by its Joint Managing Partner, N.V.K.M.Raja Mohammed, having his office at No.95, Market Road, Dindigul 624 001, Dindigul Dist., Tamil Nadu. ... Respondents. O.S.As. filed against the common order dated 31.12.2002 made in O. A.Nos.444 to 447 and 730 to 733 of 2002 in C.S.Nos.455 and 727 of 2002 respectively on the file of this Court. !For appellant : Mr.G.Masilamani, Sr.counsel for Mr.A.Prabhakara Reddy. ^For respondents : Mr.M.K.Rao, for Mr.S.Kanniah for R2 to R14 Mr.P.S.Ganesh for M/s.Kuriyan & Associates for R1. :JUDGMENT N.V.BALASUBRAMANIAN,J. The above O.S.A. Nos.30 to 37 of 2003 are preferred against a common order passed in O.A.Nos.730 to 733 of 2002 in C.S.No.727 of 2002 and O.A.Nos.444 to 447 of 2002 in C.S.No.455 of 2002 on the file of this Court. There are two suits filed one by the appellant herein in C.S.No.727 of 2002, and another by the respondents herein in C.S.No.455 of 2002. Both the parties sought for interim injunction in their pending suits restraining the other party from infringing trademark ROJA or RAJA, from infringing copyright which the respective parties have in the artistic work contained in their registered copyright, from manufacturing, marketing, selling or advertising or packing in respect of betel nut/supari or any kind or its allied products in the course of business using the trademark ROJA or ROSE or using the trading style with the initial N.V.K.M. or claiming the source or origin of business and against the passing off action. 2. All the eight petitions were considered together by a learned Single Judge of this Court and the learned Single Judge, by common order passed on 31.12.2002, held that the respondents herein have established prima facie case and the balance of convenience lies also in favour of the respondents herein. Learned Judge also held that the parties are joint proprietors of the registered trademarks and they are entitled to use the trademarks, ROJA and RAJA for the purpose of manufacturing and selling the scented betel nuts and no individual joint proprietor has any right to use the registered trademarks. Learned Judge further held that if anyone of the joint proprietors is not willing to join the majority of the joint proprietors, then it will be open to the majority of the joint proprietors to make use of the registered trademarks and the trading style and they should render a true and proper account once in a month to the other joint proprietor who is unwilling to join the trade. Learned Judge held that that this arrangement should continue in force till the disposal of rectification applications filed on either side. It is against this common order, the present appeals have been preferred. 3. A Bench of this Court admitted the appeals and ordered status quo on 31.1.2003. The appellant is the defendant in the suit, C.S.No.4 55 of 2002 (hereinafter referred to as the appellant, Zeenath Bivi) and the respondents in the appeal are plaintiffs in C.S.No.455 of 2002 (referred to hereinafter as the respondents/plaintiffs). 4. It is a dispute arising between the members of a family as to who is entitled to use the trademarks ROJA or RAJA in the manufacture of betel nut/supari. The brief facts necessary for the consideration of the appeals are that somewhere in 1942, one N.V.K.Mohamed Sultan Rowther started a proprietary concern in the name and style, N.V.K. Mohamed Sultan Rowther and Sons for the manufacture of scented betel nuts using the trademarks, ROJA, RAJA and KERA. On 22.1.1946 N.V.K. Mohamed Sultan Rowther obtained the registration of the trademark ROJA and he was using the trademark ROJA in the manufacture and marketing of the scented betel nuts. N.V.K. Mohamed Sultan Rowther started his business in Dindigul, a town in the State of Tamil Nadu and slowly the business developed. He formed a partnership firm on 1.4.1966 by making his sons and daughters and also his brother-in-law as partners of the firm. At the time of formation of the partnership firm, the appellant Zeenath Bivi was a minor and she was admitted to the benefit of the partnership and her interest was taken care of by the second plaintiff in C.S.No.455 of 2002. On 18.7.1966 N.V.K.Mohamed Sultan Rowther and his sons and daughters applied to the Trademark Registry for recording the names of sons and daughters as subsequent proprietors by virtue of the deed of partnership dated 1.4.1966 and on 30.7.1966 the sons and the daughters of Mohamed Sultan Rowther were brought on record as subsequent proprietors of the trademark. On 29.10.1966 N.V.K.Mohamed Sultan Rowther died. The partnership constituted on 1.4.1966 was reconstituted between 1966 and 1986 and it is not necessary to refer to the reconstitution of the partnership for the purpose of considering the points that arise in the appeals. 5. On 1.1.1984 the joint proprietors entered into a preincorporation agreement to convert the partnership firm into a private limited company under the provisions of the Companies Act. On 12.7.1984 N.V. K.M. and Sons (P) Ltd. came to be incorporated and on the same day an agreement was entered into among the proprietors to enable the company to exploit the trademarks for and on behalf of all the joint proprietors for a period of five years. On 24.9.1986 a supplementary agreement was entered into among the joint-proprietors as one of the joint proprietors, by name, S.Ameen Bibi died on 23.9.1986 and her legal heirs and other co-owners were desirous of permitting the user of the trademarks on payment of royalty on sales of scented betel nuts. It is necessary to mention here that in the supplementary agreement the user period of five years provided in the user agreement dated 12.7.1984 was not altered. From 1986 to 1992 the appellant Zeenath Bivi is said to be the sole agent of N.V.K.M. & Sons (P) Ltd. for the City of Chennai. On 14.3.1992 the appellant Zeenath Bivi issued a cease and desist notice to the company with copies marked to the jointproprietors stating that the period of the user agreement dated 24.9.19 86 expired on 23.9.1991 and the user of the trademarks in question on or after 23.9.1991 was illegal. 6. On 30.11.1992 Zeenath Bivi, the appellant herein, filed an earlier suit in C.S.No.1577 of 1992 on the file of this Court challenging the user of trademarks by the N.V.K.M.& Sons P.Ltd. company. She also sought for an order of interim injunction in O.A.No.961 of 1992 restraining the company from manufacturing, marketing, dealing, supplying and selling scented betel nuts and tobacco under the trademarks, ROJA, RAJA and KERA. She filed another application in O.A.No.962 of 1 992 for the appointment of a Court Receiver to take charge and collect amounts from the market, the dealers, distributors, etc. On 8.2.199 5 Zeenath Bivi and her children filed applications before the Registrar of Trademarks for registration of the trademark ROJA in their names exclusively, and it is stated in the applications that they have been using the same from 1934 and independently from 1.4.1993. Subsequently on 5.7.1995 a learned Judge of this Court has passed an order in O.A.Nos.961 and 962 of 1992 dismissing the applications holding that it would not be proper on the part of the Court to grant the relief of interim injunction restraining the company from using the trademarks or to appoint a receiver. On 28.8.1995 the appellant Zeenath Bivi sent a notice to the rest of the joint proprietors dissolving the partnership firm and questioning their right to use the trademarks. She has also stated in the notice that the High Court held that other co-owners are not entitled to efface the right of the appellant Zeenath Bivi as a co-owner and she started to use the trademark belonging to all the joint owners. On 11.9.1995 the second plaintiff has sent a reply on behalf of joint proprietors informing that the partnership business has already been dissolved and that the illegal act of using the trademark exclusively by the appellant Zeenath Bivi would be defended properly. 7. In March, 1996 the company filed an independent suit against the appellant Zeenath Bivi in O.S.No.124 of 1996 on the file of District Munsif, Dindigul, which was later on transferred to this Court and renumbered as C.S.No.688 of 1996, praying for permanent injunction restraining her from doing business in scented betel nuts in the same pattern of the company. On 6.2.1996 the appellant Zeenath Bivi filed eight original petitions before this Court for rectification seeking to remove the names of other joint proprietors and to retain the registration of trademarks in her individual name. It is stated that in March, 1996 paper publications were made by N.V.K.M. & Sons (P) Ltd. calling for applications from the willing persons to act as its agents. On 24.3.1996 an advertisement was effected by the appellant Zeenath Bivi refuting the contents of the advertisement given on behalf of the company. It is also relevant to notice here that in the suit filed by the appellant Zeenath Bivi in C.S.No.1577 of 1992 the respondents herein were made parties as defendants and subsequently she made an endorsement giving up them stating that no relief was prayed against them. 8. On 5.2.1998 the appellant Zeenath Bivi filed six applications seeking to register the trademark ROJA in her name claiming independent right over the trademark. An application in I.A.No.1034 of 1998 was taken out by the firm, N.V.K.M. & Sons represented by the second plaintiff in C.S.No.688 of 1996 to implead the firm as second plaintiff in the suit and that application was dismissed on 24.3.1998. It is stated that after the order of dismissal passed on 24.3.1998, on 13.4.1998 the partnership firm paid the renewal fees for the its registration for the period from 1994 to 1998. An appeal in O.S.A.No.64 of 1998 was preferred against the order passed in I.A.No.1034 of 199 8 and that appeal was also dismissed on 22.4.1998. It is further stated that on 17.11.2000 the company as well as the firm jointly filed O.S.No.7973 of 2000 on the file of City Civil Court, Chennai against the appellant Zeenath Bivi praying for permanent injunction and also for damages and an interim injunction was gr anted by the City Civil Court and against the order of interim injunction an appeal was filed before the City Civil Court, Chennai in C.M.A.No.21 of 2001. It is stated on 23.2.2001 that C.M.A. was allowed. On 2.3.2001 a learned Judge of this Court passed an order decreeing the suit in C.S.No.1577 of 1992 filed by the appellant Zeenath Bivi and dismissing the the suit, C.S.No.688 of 1998 filed by the company. On 14.5.2001 a C.R.P. No.1541 of 2001 was filed on the file of this Court against the order passed in C.M.A.No.21 of 2001. Similarly the company filed two appeals in O.S.A.Nos.87 and 88 of 2001. These two appeals along with C. R.P.No.1541 of 2001 were taken up by a Bench of this Court and this Court, by order dated 14.2.2002, dismissed O.S.A.Nos.87 and 88 of 2001 filed against the judgment and decree in C.S.No.1577 of 1992 as well as C.S.No.688 of 1996. Learned Judges also dismissed the C.R.P.No.15 41 of 2001 which was filed against the order made in C.M.A.No.21 of 2 001. The Company carried the matter in appeal before the Supreme Court and the Supreme Court by order dated 8.4.2002 dismissed the Special Leave Petitions filed against the judgment and decree dated 14.2.2 002 made in O.S.A.Nos.87 and 88 of 2001. The Supreme Court ordered notice in S.L.P.No.6803 of 2002 filed against the order made in C.R.P.No.1541 of 2001. The Supreme Court, by order dated 2.12.2002, disposed of S.L.P.No.6803 of 2002 with the following observation:- "whether the finding or observation of the High Court as to existence of the firm or otherwise could be traced only to proceeding in C.R. P.No.1541/2001 or otherwise in OSA.Nos.87-88/2001 could be examined by the trial Court while disposing of the suit pending before it and depending upon its finding on this aspect give appropriate finding as to existence or otherwise of the firm". 9. On 11.5.2002 the joint proprietors issued a notice through their counsel calling upon the appellant Zeenath Bivi to join them for joint exploitation of the trademarks on four conditions including the condition to pay to the joint proprietors a sum of Rs.75 lakhs being the approximate profit/benefit gained by the appellant Zeenath Bivi. Learned counsel for the appellant relied upon some portion of the said notice and and we feel that it will be advantageous to refer to what is stated in the notice itself:- "Our clients who are all joint proprietors and whose names are enumerated in para 1 above, propose to carry on business in betel nut goods falling in clause 31 by using the abovementioned registered trademarks, amongst others, under the trading style, 'N.V.K.M.& Sons', and/ or 'N.V.K.Mohamed Sultan Rowther & Sons' and/or 'Roja Betelnut Manufacturing Company' ". 10. On 22.6.2002 the appellant Zeenath Bivi sent a reply notice through her counsel refusing to accept the terms of the notice. On 24.6 .2002 O.P.Nos.406 to 411 of 2002 were filed on the file of this Court against the appellant Zeenath Bivi by other joint proprietors seeking for rectification of the register by removing the name of the appellant Zeenath Bivi as one of the proprietors in respect of the registered trademarks. On 8.7.2002 the respondents herein and the unregistered partnership firm filed a suit in C.S.No.455 of 2002 against the appellant Zeenath Bivi praying for permanent injunction restraining her from using the trademarks, from committing infringement of the copyright and from manufacturing, marketing, selling or advertising or packing in respect of betel nut/supari of any kind or its allied products in the course of business using the trademark ROJA or ROSE or or any other trademark phonetically and deceptively similar to the trademark ROJA and from using the trading style with the initial N.V.K.M. and also for damages of Rs.75 lakhs. They also filed interlocutory applications in O.A.Nos.444 to 447 of 2002. In September, 2002 the appellant Zeenath Bivi also filed a suit in C.S.No.727 of 2002 against other joint proprietors along with O.A.Nos.730 to 733 of 2002 claiming almost the similar reliefs as claimed in C.S.No.455 of 2002. On 31.12.2002 a common order was passed in all the applications and against that common order, the present appeals have been preferred. In the appeals preferred by Zeenath Bivi, it is stated, on 31.1.2003 status quo was ordered and it is not necessary to refer to various interim orders passed in the appeals as we have heard and are deciding the appeals on merits. 11. Learned Single Judge while passing the common order in O.A.Nos.444 to 447 and 730 to 733 of 2002 have framed the following points for consideration: 1) Whether the plaintiffs in C.S.No.455 of 2002 have got a prima facie case and the balance of convenience is in their favour? 2) Whether the defendant in C.S.No.455 of 2002 has made out a prima facie case and the balance of convenience is in her favour? 3. To what relief? 12. Learned Single Judge held that there is no dispute that the plaintiffs 1 to 13 and the defendant are joint proprietors of the trademarks. The appellant Zeenath Bivi filed O.P.Nos.104 to 111 of 1996 against other joint proprietors for rectification of the register by removing the names of other joint proprietors and enter her name as the sole proprietor in respect of the registered trademarks. Learned Single Judge held that simply because the appellant Zeenath Bivi used the trademarks for seven years it cannot be automatically stated that the joint proprietors would be deemed to have lost their right or they have abandoned their right. Learned Single Judge also held that there is absolutely no evidence to come to the conclusion that the joint proprietors have virtually given away their right and they could not claim the right in future. Learned Single Judge also held that when the parties are joint proprietors of the registered trademarks, the appellant Zeenath Bivi has no right whatsoever to use the trademarks exclusively for her own benefit and the use, if any, made by her would be for the benefit of all the joint proprietors. Learned Single Judge rejected the submission that the suit filed by the respondents herein is barred by limitation and held that the question whether the suit is barred by time or not is a matter that can be considered only in the course of trial on the basis of evidence to be adduced by the parties. Learned Single Judge, after noticing the decision of the Division Bench in O.S.A.Nos.87 and 88 of 2001, held that the respondents have come forward with the suit on the ground that each one of them have the right to use the trademarks. Learned Single Judge has taken into account the public interest involved in the matter of trademarks. He also held that the appellant Zeenath Bivi has not only misappropriated the trademarks for her own independent use, but also misappropriated the trading style adopting the name, N.V.K.M.Traders, thereby rendering the deception practised upon the public complete and absolute. Learned Single Judge held that the appellant Zeenath Bivi has no background in the manufacture of betel nuts according to know-how and standards of the joint proprietors who have been actively associated with the manufacture of the goods for decades as she is a housewife without any formal education. Learned Single Judge ultimately held that neither the respondents, nor the appellant could claim exclusive right to use the trademarks and the exclusive use of the trademarks by the appellant Zeenath Bivi is impermissible in law and it could be construed as one done for the benefit of all the joint proprietors. He therefore held that the respondents/ plaintiffs have made out a prima facie case and the balance of convenience is in favour of the joint proprietors and not in favour of the appellant Zeenath Bivi alone. He ultimately held that till the disposal of rectification applications filed by either side no individual joint proprietor has any right to use the registered trademarks for personal benefit and the trademarks should be used by the joint proprietors and if any one of the joint proprietors is not willing to join with the majority of the joint proprietors, then it would be open to the majority joint proprietors to use the trademarks on the same trading style and they should render a true and proper account once in a month to the other unwilling joint proprietor. It is against the common order, the present appeals have been filed. 13. We heard Mr.G.Masilamani, learned senior counsel for the appellant Zeenath Bivi and Mr.M.K.Rao, learned counsel for the respondents. Both of them have filed written arguments. 14. Mr.G.Masilamani, learned senior counsel submitted that the appellant Zeenath Bivi is the sole proprietor of the trademarks and the firm was dissolved and converted into a company. He referred to the user agreement dated 12.7.1984 and submitted that it expired on 12.7 .1989 and thereafter the company could not exploit the trademarks after 12.7.1989. He submitted that the trademarks were not used by the joint proprietors after 12.7.1989. He referred to the provisions of section 46 of the Trade and Merchandise Marks Act, 1958 (hereinafter referred to as 'Trademarks Act') and submitt ed that from the date of expiry of the user agreement five years and one month period has already expired and other joint proprietors have not used the trademarks and hence, the appellant has taken appropriate action for using the trademarks. He submitted that except the appellant, no other joint owners had used the trademarks and the user of the trademarks by the company was not proper and would not enure to the benefit of the respondents. He submitted that after 23.9.1991 no one has used the same except the appellant and referring to the letters dated 28.8.1995 and 27.10.1995, he submitted that the appellant has openly declared that she was using all the trademarks from 1995 when she launched business and she was exercising her legal rights from the year 1995 till the institution of the suit by the respondents in July, 2002 and the joint proprietors had not questioned the right of user by the appellant. He also referred to the Original petition filed for rectification and submitted that the appellant applied for registration of trademarks in her name. He submitted that the user by the appellant is not for the benefit of all the joint owners, nor is it a case of the coowners that the benefit derived by the appellant was divided among others. He submitted that the appellant continued to use the trademarks from 1995 and she has become the exclusive user of the trademarks. He submitted that since other joint owners have lost their right in the trademarks due to non-user by them, in so far as other joint proprietors are concerned, the provisions of section 24 of the Trademarks Act do not come to play and the user by the appellant is bona fide and open against other co-owners from 1995 and the user by the appellant cannot be construed to be for the benefit of other co-owners. He referred to the user of the trademarks prior to 1995 and after 1995 and submitted that the appellant was not using the trademarks stealthily, but it was an open user and she was using the trademarks bona fide after taking proper steps. He further submitted that on the date when the suit was instituted, she was using the trademarks, but, on the other hand, the co-owners have not used the trademarks but they proposed to exploit the trademarks. He also submitted that on equity also the appellant is entitled to succeed as the appellant has been using the trademarks from 1995 and she has invested considerable sum of money for setting up business and irreparable loss and injury would be caused to her if she is prevented from using the trademarks and if the respondents are permitted to use the trademarks. He also submitted that the use of the trademarks by the company is not permissible after the decision of this Court in O.S.A.Nos.87 and 88 of 2002 which has been confirmed by the Supreme Court and the co-owners are not doing any business and the business that is allegedly carried on by them is an illegal business. He submitted that the other co-owners have a proposal to jointly use the trademarks and if they start a new business, the existing business carried on by the appellant would be affected. He also submitted that the balance of convenience is in favour of the appellant as the business was carried on by the appellant even prior to 1995 and the appellant should be allowed to continue her business and she is prepared to submit accounts and if there are profits, the appellant would share the profits along with the co-owners, in case she fails in the suit filed by her. He submitted that the appellant has