IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.626 OF 2006. NOTICE OF MOTION NO.626 OF 2006. NOTICE OF MOTION NO.626 OF 2006. IN IN IN SUIT NO.571 OF 2006. SUIT NO.571 OF 2006. SUIT NO.571 OF 2006. Neutron Electrronic Systems Pvt. Ltd. having its office at 205, Wadala Udyog Bhavan, 8 Naigam ‘X’ Road, Wadala, Mumbai 400 031 ..Plaintiff versus 1. Neutron Service Centre Pvt. ltd. having its registered office at Panasonic Authorized Customer Care Centre, TV Industrial Estate, Gala No.22, Basement, S.K.Ahire Marg, Worli, Mumbai 400 025 and branch office at L.G.Authorised Service Centre, LG, 364, Dhuru Wadi, Veer Savarkar Marg, Mumbai 400 025 2. Shri Arvind Savardekar, having his place of residence at 227/A, Bahadur Mansion, L.J.Road, Shivaji Park, Mumbai 400 016 3. Shri Sanjay Thugare, having his place of residence at ‘OM’ Plot No.88, Abhinav Nagar, Borivli (East), Mumbai 400 066 ..Defendants Mr.V.R.Dhond, Rahul Kadam i/b. H.W.Kane for the Plaintiffs- Applicant in support of Notice of Motion Mr.R.D.Soni with S.N.Gawde i/b. Ram & Co. for the for the Defendant Nos.1 and 2 CORAM : R.Y.GANOO, J. CORAM : R.Y.GANOO, J. CORAM : R.Y.GANOO, J. DATED : 21st Oct., 2008. DATED : 21st Oct., 2008. DATED : 21st Oct., 2008. -2- JUDGMENT :- JUDGMENT :- JUDGMENT :- 1. The plaintiffs have filed this suit and have applied for injunction against the defendants on two counts (i) Committing breach of the trade mark "Neutron" and or passing off the plaintiff’s use of the term "Neutron". The appropriate prayers are set out in terms of prayer clauses (a) to (d) of the plaint. By prayer clause (e) plaintiffs have sought compensation to the tune of Rs.2,00,000/- for having suffered damage on account of use of the word "Neutron" and related aspects. By prayer clause (f) plaintiffs want that the defendants should be ordered to deliver to the plaintiffs for destructing various articles/materials set out in prayer clause (f) relating to the trade mark of "Neutron" or the Corporate name Neutron Service Centre Pvt. Ltd. 2. Keeping in view the principal prayer in the plaint, the plaintiffs have asked for diverse reliefs in terms of prayer clauses (a), (b) and (c) in this Notice of Motion and the said prayers are as under:- -3- (a) that the defendants by themselves, their directors, servants, agents and dealers be restrained by a permanent Order and injunction of this Honourable Court from infringing the plaintiffs registered trade mark NEUTRON bearing No.519318 in class 9 by the use of the impugned trade mark NEUTRON or any other trade mark deceptively similar to the plaintiffs registered trade mark NEUTRON in respect of their said goods and services or in any other manner whatsoever. (b) that the Defendants by themselves, their servants, agents and dealers be restrained by a permanent order and injunction of the Hon’ble Court from passing off their aforesaid services and/or business as and for the well-known services and/or business of the plaintiffs by the use of the impugned trade mark NEUTRON and/or any other trade mark deceptively similar to the trade mark NEUTRON. (c) That the defendants by themselves, -4- their servants, agents and dealers be restrained by a permanent order and injunction of this Hon’ble Court from passing off their aforesaid services and/or business as and for the well known services and/or business of the plaintiff by the use of the corporate name or trading style NEUTRON SERVICE CENTRE PVT. LTD. or any other corporate name or trading style containing the work NEUTRON or a word deceptively similar to the word NEUTRON in respect of the goods and/or services. The parties herein have filed affidavits and pleadings are completed. 3. The plaintiffs are manufacturing telecommunication equipments and systems, the computer related net-working and data-communication equipments and software including ’Key Telephone System’ (EPABX), VHF (wireless) equipments, Video/Audio conferencing equipments , Multiplexers, Multi channel voice recorders, Modems, Line Drivers etc, and marketers and service providers for the aforesaid equipments more particularly set out in -5- para 1 of the plaint. 4. The plaintiffs claim that the defendant No.1 is a private limited company and the defendant Nos.2 and 3 are its directors and that the defendants provide customer care services to the electronic and telecommunication goods. 5. The record shows that the plaintiffs trade mark "Neutron" came to be registered way back in the year 1989 under clause (9) whereas the trade mark of the defendants "Neutron" came to be registered under clause (37) (various services) w.e.f. January 2005. The plaintiffs have admitted that they have applied for registration under Clause 37 and it is in these peculiar circumstances, at the stage of hearing of the Notice of Motion, the plaintiffs have conceded that they are not pressing for relief in terms of prayer clause (a) which relates to use of the trade mark "Neutron" vide clause (9). Appropriate order so far as prayer clause (a) shall be passed herein. 6. The plaintiffs are manufacturers, marketers and service providers for the various articles as -6- set out aforesaid. The defendant No.1 is a limited company and attends to servicing of various electronic consumer products such as television, washing machines, audio systems of reputed companies. This admission is found in paragraph 6 of the affidavit in reply. The plaintiffs claim that they are in the line from 1989 and the plaintiffs have relied upon number of documents and the important document pressed in service is the registration under clause (9) which has been granted in the year 1989. The defendants have come out with a case that they are in the business of servicing from 1997 and defendants have also produced documentary evidence in the nature of Deed of Partnership which brought into existence partnership firm by name Neutron Service Centre on 23.9.1997 and thereafter the said firm got transferred into a private limited company by name Neutron Service Centre Pvt. Ltd. in December 2000. Certain advertisements and/or brochures released since after 1997 are annexed to the affidavit in reply filed by the defendants. Perusal of the documents relied upon by the plaintiffs shows that they are in the line from 1989. A perusal of the documents relied upon by -7- the defendants shows that they are in the line from 1997. The next question is what is the field of activity so far as the plaintiffs and the defendants are concerned. This is required to be viewed by keeping in mind that the first word of both the establishments is "Neutron". The plaintiffs are manufacturers, service providers and marketers for various electronic goods and telecommunication and this fact is not disputed by the defendants. The defendants have come out with the particulars of their activity at two places namely at paragraph No.6 and paragraph No.9 of the evidence affidavit. My attention was also drawn to the various brochures and advertisements as also the photographs of the shops of the defendants to show that the defendants deal as service providers. The relevant part of paragraph 6 of the affidavit in reply which throws light on the nature of the business of the defendants is as follows "I further say that as the name of the defendant No.1 suggest it is engaged inter alia in providing after sale services to the electric appliances which include T.V. Sets, Washing Machines, Audio Equipments manufactured by reputed companies such as Panasonic, LG, Godrej, Toshiba, Nash etc." More or -8- less repetition of these words is found in paragraph 9. 7. My attention was drawn to agreement dated 28.4.1997 said to have been executed between M/s. National Panasonic India and defendants by which the said National Panasonic India Pvt. Ltd. had appointed the defendants as service agents for their products. Learned Advocate Mr. Soni appearing on behalf of the defendants submitted that the defendants are attending to the complaints in respect of the products of the various companies and attend the after sale service and the various companies have authorised them to work accordingly and that is how the business of the defendants is in a different field. 8. Learned Advocate Mr.Dhond appearing on behalf of the plaintiffs had submitted that the defendants have used the word "Neutron" while drafting the name of their company and the use of the word "Neutron" which is being done by the defendants since 1997 as the effect of creating impression in the mind of the public at large that the defendants are part and parcel of the -9- plaintiffs and that is how the defendants are acting, which has resulted in passing off the name of the plaintiffs. Learned Advocate Mr. Dhond had submitted that the defendants are dealing with sales service in respect of telecommunications as is manifested in the agreement with National Panasonic which mentions servicing of cordless telephones. As against this, learned Advocate Mr.Soni appearing on behalf of the defendants had submitted that the defendants are attending to the servicing of various articles produced by well known companies and there is no chance of the customers of the plaintiffs coming to the defendants and getting some services in regard to the products which are manufactured by the plaintiffs and therefore there is no question OF confusion in the mind of the customers who would be approaching the defendants. It was contended by the learned Advocate Mr. Soni that the defendants are functioning in a totally different field and therefore there is no question of plaintiff’s name being passed off by the defendants. 9. Learned Advocate Mr.Dhond had submitted that the defendants had used the word "Neutron" for -10- the purpose of creating deceptive similarity and take the advantage of the situation and the goodwill created by the plaintiffs in the market. According to him, in the absence of specific explanation coming from the defendants in the affidavit in reply as to how the defendants adopted the name "Neutron", this stand of the plaintiffs is required to be accepted. He had submitted that the key word "Neutron" is very important for the purpose of appreciating the argument. In reply to this, learned Advocate Mr. Soni had submitted that the word "Neutron" is a generic name and the defendants cannot be treated as having used the word "Neutron" with specific intention of creating deception in the mind of the members of the public. He had also submitted that the plaintiffs have not placed before the Court a single incident through a customer of the plaintiffs to suggest that he had approached the defendants for the purpose of getting the articles manufactured by the plaintiffs duly serviced and that the defendants had attended to the said articles and the said customer was dis-satisfied. Learned Advocate Mr. Soni, in support of this contention had relied upon the judgment in case of Ayushakti Ayurvedi Pvt. ltd. Ayushakti Ayurvedi Pvt. ltd. Ayushakti Ayurvedi Pvt. ltd. -11- & Ors. v. Hindustan Lever Limited reported in & Ors. v. Hindustan Lever Limited reported in & Ors. v. Hindustan Lever Limited reported in 2003(4) Mh.L.J. 2003(4) Mh.L.J. 2003(4) Mh.L.J. 10. Learned Advocate Mr. Dhond had submitted that at any rate the plaintiffs are using the word "Neutron" as key word from 1989 and the defendants are in the line with use of the word "Neutron" from 1997 and therefore the prior use of the word "Neutron" by the plaintiffs would be relevant and therefore the plaintiffs are entitled to an order of injunction as claimed in the motion. 11. Learned Advocate Mr Dhond, had relied upon the judgment in case of Harish Motichand Saria v. Harish Motichand Saria v. Harish Motichand Saria v. Ajanta India limited & Anr. in Notice of Motion Ajanta India limited & Anr. in Notice of Motion Ajanta India limited & Anr. in Notice of Motion No.682 of 2003 in Suit 667 of 2003 No.682 of 2003 in Suit 667 of 2003 No.682 of 2003 in Suit 667 of 2003 to contend that the plaintiffs have acquired reputation in respect of the name "Neutron" and the use of the name "Neutron" by the defendants constitutes passing off. He had also relied upon the judgment in the case of Laxmikant V. Patel v. Chetanbhai Shah & Laxmikant V. Patel v. Chetanbhai Shah & Laxmikant V. Patel v. Chetanbhai Shah & Anr. reported in (2002) 3 Supreme Court Cases 65 Anr. reported in (2002) 3 Supreme Court Cases 65 Anr. reported in (2002) 3 Supreme Court Cases 65 to submit that the court has to consider the probability of confusion of passing off and thereafter arrive at an inference and in his -12- submission if facts in this case are considered, the court should come to the conclusion that the institution of the suit by the plaintiffs for passing off action is justifiable. He had relied upon the judgement in the case of Poddar Tyres Ltd. Poddar Tyres Ltd. Poddar Tyres Ltd. v. Bedrock Sales Corporation ltd. & Anr. v. Bedrock Sales Corporation ltd. & Anr. v. Bedrock Sales Corporation ltd. & Anr. reported in AIR 1992 Bombay 237 reported in AIR 1992 Bombay 237 reported in AIR 1992 Bombay 237 to submit that the Court has to test whether the adoption of the name "Neutron" by the defendant was bonafide and honest act. He submitted that the defendants have drafted the name of their firm/company as "Neutron" with a clear design that they wanted to take benefit of the situation. 12. Learned Advocate Mr. Soni appearing on behalf of the defendants had relied upon the Judgment in the case of Hydroclave System Hydroclave System Hydroclave System Corporation & Ors. v. Jain Hydraulic Pvt. Ltd. Corporation & Ors. v. Jain Hydraulic Pvt. Ltd. Corporation & Ors. v. Jain Hydraulic Pvt. Ltd. & Anr. reported in 2003(1) Bom.C.R.642. & Anr. reported in 2003(1) Bom.C.R.642. & Anr. reported in 2003(1) Bom.C.R.642. to submit that the nature of the business carried out by the defendants is deciding factor and if that is done then the Court should observe that the defendants are dealing in sales service and after care service and hence there is no overlapping and or question of passing off by the defendants. Learned Advocate -13- Mr. Soni had relied upon the judgment in case of Boots Company PLC & Anr. vs. Register of Trade Boots Company PLC & Anr. vs. Register of Trade Boots Company PLC & Anr. vs. Register of Trade Marks & Anr. reported in 2002(4) Bom.C.R.36 Marks & Anr. reported in 2002(4) Bom.C.R.36 Marks & Anr. reported in 2002(4) Bom.C.R.36 and had drawn my attention to paragraph 12 by which he wanted this Court to consider the case by applying the various "tests" which are mentioned in the said judgment and then arrive at an inference so as to dismiss the motion of the plaintiffs. He had also drawn my attention to the judgment in case of S.M.Dyechem Ltd. vs. Cadbury (India) Ltd. S.M.Dyechem Ltd. vs. Cadbury (India) Ltd. S.M.Dyechem Ltd. vs. Cadbury (India) Ltd. reported in (2000) 5 Supreme Court Cases 573 reported in (2000) 5 Supreme Court Cases 573 reported in (2000) 5 Supreme Court Cases 573 to submit that what would be impression in the mind of a person of reasonable comprehension is relevant for the purpose of deciding the mute question before this Court. He had also relied upon the judgment in the case of Cadila Health Care Ltd. v. Cadila Health Care Ltd. v. Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd. reported in 2001 PTC Cadila Pharmaceuticals Ltd. reported in 2001 PTC Cadila Pharmaceuticals Ltd. reported in 2001 PTC 541 (SC) 541 (SC) 541 (SC) and drawn my attention to paragraph 35 wherein the Court had framed the principles on which the allegations of passing off are required to be decided. He submitted that on proper appreciation of the facts before the Court, the allegations made by the plaintiffs cannot be accepted and the motion is required to be dismissed. -14- 13. Learned Advocate Mr. Soni had contended that there has been delay in institution of the suit. According to him the defendants are in the line from 1997. He submitted that various brochures, advertisements are being released from time to time since 1997, various vehicles of the defendants are moving in the city exhibiting necessary information that they are dealing in service sector with the word "Neutron" and therefore plaintiffs can’t say that they were not aware of the defendants existence till June 2005. According to learned Advocate Mr. Soni, the knowledge is required to be imputed to the plaintiffs that the plaintiffs knew that the defendants were in the line with the word "Neutron" much prior to June 2005 and therefore the institution of suit on 14.2.2006 is at a belated stage and is fatal to the case of the plaintiffs. In reply, learned Advocate Mr.Dhond submitted that no specific incident had been quoted by the defendants to say that the plaintiffs were made aware of the fact that the defendants are in line with the use of word "Neutron" prior to June 2005. He had also submitted that at the stage of hearing -15- of the Notice of Motion the court should accept the word of the plaintiffs that they came to know about the existence of the defendants with the word "Neutron" in June 2005. He had also pointed out that upon plaintiffs coming to know about the defendants using the word "Neutron", a notice came to be issued by the plaintiffs through their advocate on 26.7.2005 calling upon the defendants to desist from using the word "Neutron" etc and that the defendants instead of denying the allegations in the said notice felt satisfied by filing a caveat and no reply was given to the said notice. According to learned Advocate Mr. Dhond, the conduct on the part of the defendants goes to show that the defendants accepted the case of the plaintiffs that in June 2005 only the plaintiffs came to know about the existence of the defendants with the word "Neutron". Learned Advocate Mr. Dhond appearing on behalf of the plaintiffs had cited the judgements (i) in the case of Bal Pharma Ltd. v. Centaur Laboratories Pvt. Ltd. & Anr. reported in 2002 (24) PTC 226 (Bom) (DB) and (ii) in the case of M/s. Hindustan Pencils Pvt. Ltd v. M/s. India Stationery Products Co. and another reported in AIR 1990 Delhi 19 on the question of -16- delay and submitted that on proper appreciation of the material the Court should hold that thee is no delay in institution of the suit and that factor should not be considered in favour of the defendants. 14. Learned Advocate Mr.Dhond had drawn my attention to the annexures to the plaint wherein it is seen that in Suit No.3913 of 1998 to which the present defendant Nos.2 and 3 were party as partners of the Sonytron Service Centre. He pointed out that at the relevant time the defendant Nos.2 and 3 and even defendant No.1, namely Sonytron Service Centre in the said suit submitted to the decree of the Court where a similar action was launched against the defendant Nos.2 and 3 and their company. Learned Advocate Shri Dhond submitted that this goes to show that the defendant Nos.2 and 3 take the advantage of the situation of a particular name floating in the market and float the companies and try to have the benefit of the situation to get through the business. Learned Advocate Mr.Dhond wanted this Court to treat the incidence of decree in the Suit No.3913 of 1998 against the defendants and held that the plaintiffs -17- have made out a prima facie case against the defendants to grant order of injunction. 15. I have considered the rival submissions advanced across the bar and I have perused the judgments relied upon by the respective parties. Firstly, I will advert myself to the question of delay. The plaintiffs allege that they came to know about the defendants with the use of the word "Neutron" in June 2005. Notice as aforesaid came to be issued on 26.7.2005. No reply is filed. Caveat came to be filed and suit came to be filed on 14.2.2006 i.e. after about 6 to 7 months after the notice was issued. The record produced by the defendants may prima facie go to show that they are in the line with the use of the word "Neutron" from 1997. However, the stand taken by the defendants that the knowledge regarding the existence of the defendants will have to be imputed to the plaintiffs cannot be accepted. The advertisements and brochures are relied upon. However, mere reliance on these brochures and advertisements is not sufficient to impute to the plaintiffs the knowledge of the existence of the defendants. No specific instance is quoted by the defendants on -18- the basis of which it can be said that the plaintiffs were in know of the factual existence of the defendants. To that extent the case of the defendants is required to be rejected. 16. In so far as the stand of the plaintiffs that they came to know about the existence of the defendants in June 2005, I am inclined to observe that at the stage of hearing of the Notice of Motion the Court will have to accept the word of the Plaintiffs and proceed further. While doing so, the Court also will have to consider the conduct of the parties and if that is done the defendants appear to be at fault. The plaintiffs, soon after coming to know about the existence of the defendants gave notice to which no reply was filed. In the normal course the defendants ought to have denied the allegations levelled against them. It is true that the fact that such a notice was not replied does not go to show that the defendants have accepted the allegations, still that is the conduct which is required to be considered against the defendants when the question of delay is being considered. I have gone through the judgment in the case of Bal Pharma Ltd. v. -19- Centaur Laboratories Pvt. Ltd. & Anr (Supra) and the relevant paragraph in the said judgment is paragraph 9. Perusal of paragraph 9 would go to show that the delay must be such as to have induced the defendant or atleast to have lulled into a false sense of security to continue to use the trade mark in the belief that he was the monarch of all he surveyed. In the present case defendants have not been able to bring on record any material to show that since after 1997 their business and their activity were to such a vast level that the plaintiffs would know without any efforts that there exists a firm/company with the word "Neutron" as its first word. The judgment in the case of M/s. Hindustan Pencils Pvt. ltd. v. M/s. Indian Stationery Products Co. (Supra) also indicates that if there is a delay and if a common man/customer is going to be sufferer then the question of delay should not come in the way of grant of Order of injunction. In the present case I am inclined to observe that there is no delay on the part of the plaintiffs in instituting the present suit for the reasons mentioned aforesaid and as such the case of the plaintiffs cannot suffer on the question of delay. -20- 17. Coming to the field of activity of both the parties, it is clear that the plaintiffs are manufacturers as well as service providers in so far as the various kinds of electrical and telecommunication apparatus. The defendants claim that they are attending to servicing of various consumer durables and electrical items as mentioned aforesaid. The main stand of the defendants is viz. they are attending to goods in different categories. I have already reproduced the relevant portion