ITC LIMITED Vs. RAKESH BEHARI SRIVASTAVA

JUDGEMENT

(1.) This application under Section 115 of the Code of Civil Procedure has been directed against an order dated 26-5-1996 recorded by learned Civil Judge Senior Division, Gorakhpur, in Original Suit No. 208 of 1995 whereby he had rejected the application made by, the defendant-revisionists under Order VII, Rule 11, C.P.C. The plaintiffs had filed a suit against the I.T.C. for reliefs that they may be restrained from selling a particular brand of cigarette. The defendants took up a preliminary objection on two counts. It was stated that the plaint did not disclose any cause of action and that the suit was barred under Section 56 of the Trade and Merchandise Marks Act, 1958. On these two pleas the defendants moved a prayer for rejection of the plaint under Order VII, Rule 11 C. P. C. This prayer was dismissed which had given rise to the present revision application.

(2.) There, are however, certain other complications which must be stated before the matter is taken up for decision. After the filling of the suit, the plaintiffs (Present O.P.S.) filed an application for an ad-interim injunction which was allowed and the defendants straight away came up in a writ petition before the High Court. At this level the parties came to of a settlement and some consent order was passed. Upon that consent order the injunction order was vacated and hearing of the suit was directed to be taken up. The plaintiffs, thereafter amended their plaint and the defendants raised the plea of rejection of the plaint. The plaintiffs objected the entertainment of that prayer on the ground that it was beyond the consent order. A clarification was sought before the High Court from the Hon'ble Judge who had recorded the consent order. In his clarification, the Hon'ble Judge directed that the application under Order VII, Rule 11, C.P.C. may be confined to the amended plaint. The matter was heard before the Court below and the impugned order was passed. In addition to the merits of the case. the parties, also placed before me conflicting arguments as to what would be the meaning of the words amended plaint for considering the application under Order VII, Rule 11, C.P.C. Before this Court a true interpretation of Section 115, C.P.C. was also raised and the relevant provisions of the Trade and Merchandise Marks Act, were also analysed by the learned counsels.

(3.) The allegations in the suit and the further developments as hinted above may now be stated. The suit was filed by Sri Rakesh Behari Srivastava and two others against the I.T.C. Limited, a compay within the meaning of the Companies Act, on assertion that the three plaintiffs were smokers and they had purchased and smoked cigarettes under the brand names "W.D. and H. C. Wills and "Wills" manufactured and sold by the defendants. The plaintiffs used to purchase loose cigarette sticks and had never any opportunity of purchasing a whole packet, and accordingly had no chance to go through the printings on the packets. It was stated that the plaintiffs purchased and smoked the above brands of cigarettes under the impression that they were of a high quality being manufactured under the license of a British Company carrying the same brand names or these cigarettes were manufactured as per standard fixed by the aforesaid foreign company or under its supervision. It was alleged that the cigarettes manufactured by the foreign company, were having a different, formula than these manufactured in India by the defendants. The plaintiffs were not the sole purchasers and smokers of the aforesaid brands. There were other people also who purchased and smoked these brands under an impression that the same were manufactured by or under the supervision of the British Company. The plaintiffs have thus been affected by the wrongful act on the part of the, defendants' company and they craved to file a suit on behalf of the general body of the smokers, It was alleged that the defendants had never informed the plaintiffs or other smokers that they were manufacturing the above brand of cigarettes not under the licence or authority of the foreign company and were acting on their own. There was no advertisement or anything like that issued by the defendant-company at any point of time. They had never mentioned anywhere, including the packet of the cigarette, that they acquired the right to manufacture and sell of cigarettes under the above two brands. It was alleged that the defendants had misrepresented to the plaintiffs and other citizen of the country and gave an impression to them that the aforesaid brand of cigarettes were being manufactured and sold by the defendants - company under the licence and authority of the foreign company. By such representation the defendants clearly deceived the public in general. Due to fraud and misrepresentation the plaintiffs had been made to believe that they were getting genuine brands of cigarettes. It was alleged that these brands marked "Wills" and "W.D. and H.C. Will" were registered in England as the proprietary marks of foreign companies namely British American Tobacco Co. or Imperial Tobacco Co. Ltd. (In short Foreign Companies). These marks were associated with a foreign company enjoyed tremendous reputation not only in England but also throughout the world including India. The plaintiffs had always been under the impression that the cigarettes manufactured under these two brand marks by the defendants-company were produced on the basis of the know how and expertise of the aforesaid foreign company and was under the rigorous quality control of them. The defendants by producing and selling cigarettes under the two brand names were causing deception and confusion to the general public including the plaintiffs and they had passed off and were still passing off their goods as those manufactured by the aforesaid foreign companies and atleast were causing confusion and deception and there was probability of confusion and deception amongst the general member of the public. It was stated that the use of the said brand marks by the defendants had caused or was likely to cause confusion and deception amongst the members of smoker public. They went on to say that these aforesaid foreign companies by allowing the defendant company to use the identical brand marks to manufacture and sell cigarette, had caused and were still causing confusion and deception and were creating a situation in which there was atleast a probability of confusion and deception in the mind of the smokers as well as the public in general. The two brand marks belong to the said two foreign companies and the production of these foreign companies were still known in India as people associated these marks with the foreign companies. The plaintiff's were throughout under the impression that the cigarette manufactured by the defendants company under the above two brand marks were produced by using the same formula, know-how and expertise associated with the said foreign companies under their strict control and the defendants company were associated or connected with the said foreign companies, but the plaintiffs now had come to know that the defendants did not use any expertise, know how or technical assistance's of the said foreign companies in manufacturing the cigarette and selling the same under the two brand marks nor was there any quality control whatsoever in respect of the aforesaid product and the cigarettes manufactured by the defendants company were inferior in comparison to those produced by the foreign company. It was alleged that the defendants company had passed off and still passing off the above brand names of cigarettes as if they were goods produced by the said foreign companies and the plaintiffs by purchasing and smoking the said cigarettes have been deceived and confused and there were chances of deception of the general public also. It was reiterated that the said foreign companies by allowing the defendants to use the said marks in, respect of the goods manufactured in India had created a situation whereby the plaintiffs have been deceived and confused. The plaintiffs asserted further that the defendants got these marks registered in their name in India from the office of the Registrar Tract Marks and ad such (the registration was contained by misleading the Registrar and by committing fraud on his office and that these two. marks belong to the said foreign companies and cigarettes produced by the foreign company under these two marks were enjoying tremendous reputation in India in the date the defendants obtained registration in its name in their favour. They could not have applied for such registration as they were not the proprietor of the said Trade Marks. The registration was obtained by suppression of facts regarding the proprietorship. The defendants obtained the registration by making a false statement. Due to false statement, suppression of facts and fraud the -registration obtained by the defendants was a nullity and was void ab initio. He would not insist therefore, for any cancellation of the registration. The marks could never be registered in India in the name of the defendant company and the mandatory provisions of the Trade and Merchandise Marks Act were violated. The defendants did not have any distinctiveness in respect of the said marks and the registration was bad under Section 9 of the Trade and Merchandise Act, The plaintiffs relied on a decision of the Calcutta High Court in their plaintiff averments at paragraph 16, It was stated that in terms of this decision as reported in AIR 1924 Cal at page 216 the purported assignment in 1920 of the trade marks "Wills" or "W.D. and H.O. Wills" in favour of the defendants company was invalid and of no use, inter alia, because the purported assignment was not an assignment of the entire business or the origin or the manufacturer and further the purposed assignment was not by both the said foreign companies. It was stated that the using of the aforesaid brand marks by the defendant company was a wrongful act which affected the plaintiff and the general public prejudicially, and thus the plaintiffs are entitled to file the suit. It was averred that the continuation of the deception and confusion should be stopped and there should 5 be a declaration that the defendants were not entitled to use the aforesaid marks for their a product. The plaintiff were, therefore, entitled to a decree of perpetual injunction and damages, which was assessed at Rs. 1 lac. It was stated that the cause of fiction of the present suit arose when the plaintiff for the first time came to know of the illegal acts on the part of the defendant-company immediately prior to the filing of the suit. The 'relief that were prayed for were for a decree of declaration that the defendants were not entitled to use the aforesaid marks for their product of cigarette, for further declaration that the registration of the defendants as owners of the above two marks as Trade marks was void ab inito and non-est in the eye of law. The plaintiffs also claimed for compensation and damages an for art order for payment of the same.