Case BriefsHigh Courts

“Principles laid down for Courts to deal with injunction applications, in a pending suit, seeking relief against passing off”

 Karnataka High Court:  A  Division bench of Aravind Kumar and Pradeep Kumar Yerur dismissed the appeal and affirmed the order dated 22-06-2021 passed in O.S.No.177/2021 by LXXXIV Additional City Civil and Sessions Judge (CCH-85) (Commercial Court), Bengaluru.

 The facts of the case are such that the plaintiffs i.e. ITC Limited launched itself into the manufacturing and sales of ‘instant noodles’ in September 2010, under the brand name, ‘Sunfeast YiPPee!’ having different variant of noodles, including ‘Magic Masala’, ‘Mood Masala’, ’Classic Masala’, to name a few. The Plaintiff claimed protection from alleged misrepresentation and copyright infringement in respect of the ‘overall visual appearance’ (wrapper) of ‘Magic Masala’ variant of Sunfeast Yippee noodles by the defendants i.e. CG (India) Private Limited who manufactures and sells in the instant noodles market under the brand name ‘WAI WAI’ and the product under challenge is one of its white-noodles product, ‘WAI WAI Xpress Noodles Majedar Masala”. Plaintiff claims that the action of the defendant has caused damage to its goodwill and reputation in the market and as such defendant has to be restrained from using same and thus the plaintiff has sued defendant and it bases its cause of action in passing off and copyright infringement.

Counsel for the appellant- plaintiff Mr. K.G Raghavan submitted that that extent of similarity is sufficient to ‘deceive’ that class of persons who are likely to buy plaintiff’s goods. It was further submitted that the court below has fallen into error on a matter of principle in so far as it has laid emphasis on the ‘dissimilarities’ between the competing wrappers, instead of estimating the effect of the similarities.

Counsel for the respondent- defendant Mr. Dhyan Chinappa submitted that on an overall consideration of the competing wrappers, after ignoring the descriptive marks and marks common to trade, it is the ‘brand names’ that is really distinctive of the plaintiff and since the brand names are completely dissimilar; there is no likelihood of confusion. If the plaintiff’s case is that the colour scheme has been copied to the extent that it may lead to confusion, the plaintiff will have to show that the ‘orange-red’ colour scheme has acquired such a high level of distinctiveness in the market, that the ordinary purchaser would ignore all other features and rely solely on the colour scheme to identify the products of the plaintiff.

Concept of “passing off”

One of the cause of action upon which the plaintiff relied was passing-off and to establish an arguable case in passing-off action, the plaintiff must show a misrepresentation express or implied that the defendants wrapper is connected with or may be associated with the plaintiffs’ business and that as a consequence damage is likely to result to the plaintiffs.  In passing-off, following points are under consideration:

  1. Distinctiveness of the plaintiffs mark
  2. Deceptive Similarity

 The entire basis of an action for the tort of passing-off lies in the making of a misrepresentation by the defendant which is calculated to cause damage to the business or goodwill of the claimant. The design that a typical form of misrepresentation generally takes is for the defendant to adopt that feature of the plaintiff’s mark which the ordinary purchaser is most likely to associate or use to identify the goods as that of a plaintiff.

Concept of “distinctiveness”

Professor Wadlow claims that term ‘distinctive’ has a meaning of its own, in the legal sense, which does not coincide with the ordinary use of the term in common parlance. In its legal sense, a name, mark or get-up can be said to be distinctive ‘if it denotes the goods of the claimant to the exclusion of all others’. What plaintiff claims to be distinctive may be ‘distinctive in fact’ but the plaintiff cannot have the final say on what is distinctive in law. The concept of ‘distinctiveness’, can be concluded as the features relevant for our analysis, does not include all features (that is, overall get up) as claimed by the plaintiff, but it is those distinguishing features which perform the function of a trade mark – the function of a trade mark being that of ‘source identification’.

The Court observed that even a bare look at the wrapper of the Magic Masala brand would indicate that ‘Yippee’ written in yellow color and relatively, the largest font (in both 12 Rs packs and 48 Rs pack) stands out in contrast to the ‘Sunfeast’ logo which is written in red font against a red background; and with respect to Magic Masala, which is written in dark blue color in a much smaller font size against an orange background. ‘Yellow’ being a light as well as bright colour , coupled with the fact that Yippee bears a stylised script and large font, appears to strike itself to the sensory organs quite easily purely on first impression as well.

The Court further observed that the features which can be said to be ‘distinctive’ in law in the sense that the relevant public would rely on such features to associate the goods as that of the plaintiff or to identify the goods as that of plaintiff or to distinguish the goods of the plaintiff from others would be, essentially, the brand ‘Sunfeast Yippee’ and to a lesser extent, the sub-brand which indicates the various flavours – in this case, ‘Magic Masala’.

The Court thus observed that the misrepresentation must be believed by those to whom it is communicated [through word marks, visual marks, labels or the entire get up as a whole], and such persons must be likely to act in reliance of the supposed misrepresentation. As noted, persons are likely to act in reliance of those features of a plaintiffs product which is said to be ‘distinctive’ of it in the legal sense. Hence the question of distinctiveness and that of misrepresentation are not independent of each other but are strongly interdependent and are always capable of interacting with each other.

Examination of ‘deceptive resemblance’ vis a vis present case

The test to determine ‘deceptive resemblance’ is essentially decided by asking two questions:

  1. Person / Hypothetical purchaser
  2. ‘Rules of Comparison’

 It was observed that in general it would not be an easy task for a plaintiff to establish a case of passing off by “get up” alone, especially at the interlocutory stage, unless the resemblance between the goods is so close that it can hardly have occurred except by deliberate imitation.

The Court observed that on careful analysis of the marks, logos, pictures and how the products are listed on digital platforms and physical stores it is clear that from the perception of the hypothetical purchaser, even after making allowance for imperfect recollection, the point of reference for purchasing the plaintiff’s goods is primarily the brand – Sunfeast Yippee, or the mark – Yippee or the phrase ‘Yippee Magic Masala’. “We find it rather unconceivable, at this stage (without any data or evidence in front of us) to conclude that the hypothetical purchaser would go and ask for ‘red-orange noodles’. Even if he does, it is very unlikely that a shopkeeper would straightaway handout the ‘Yippee Magic Masala’ brand of noodles since it has been show to us that there are other wrappers which may though not have, strictly speaking, an identical colour scheme but have similar colours on their wrappers.”

 Test of Copyright Infringement

 The Court observed that while deciding the question of copyright infringement it is not necessary that the defendants work must be an exact reproduction of the plaintiffs work. What is essential is to see whether there is a reproduction of the substantial part of the plaintiffs work. It was further stated that if the plaintiff cannot demonstrate that substantial features of the plaintiff’s get up has been reproduced in the defendant’s get up, then merely showing similarity or identity in other non-essential features will be of no consequence.

The Court further laid down principles for Courts to deal with injunction applications, in a pending suit, seeking relief against passing off. [Refer judgment]

The Court thus held “that order of learned trial Judge dismissing the applications filed by the plaintiff for grant of temporary injunction deserves to be affirmed.”

[ITC Limited v. CG Foods (India) Private Limited, 2021 SCC OnLine MP 1906, decided on 28-09-2021]

 


Arunima Bose, Editorial Assistant has reported this brief.


Appearances:

For Appellants: Mr. K G Raghavan , Dharmendra Chatur and Sanjanthi Sajan Poovayya and Co.

For Respondents: Mr. Dhyan Chinappa, Lomesh Kiran N, Mr. Abhinay V and Mr. Tejas

Op EdsOP. ED.

INTRODUCTION

The National Emblem was adopted by the Government of India on 26th January, 1950, and it is regarded as a symbol of power of the Government. The National Emblem, other emblems and names are governed by different legislations. The National Emblem is governed by the State Emblem of India (Prohibition of Improper Use) Act, 2005[1] and the State Emblem of India (Regulation of Use) Rules, 2007[2]. The Indian National Flag, the name, emblem or official seal or emblem of the Government of India or of any State, or any other insignia or coat-of-arms used by the Governments or by a Department of any such Government, etc. are governed by the Emblems & Names (Prevention of Improper Use) Act, 1950[3] and the Emblems & Names (Prevention of Improper Use) Rules, 1982[4]. The objective of these legislations is to prohibit the misuse of the National Emblem, Names and Symbols and to prevent them from being misapplied. The three lions on the National Emblem symbolise justice, peace and tolerance. The National Emblem, State Symbols, and Names possess ultimate importance and cannot be garbled to bewilder the public at large to make them fall for misemployed emblems and symbols. It becomes profusely important for the public to be aware of the authenticity of the use of emblems and symbols especially when inscribed by non-governmental organisations in their flyers or brochures to collect funds, donations, and contributions in times of crisis.

Rule 10 of the State Emblem of India (Regulation of Use) Rules, 2007, imposes restrictions on the use of the State Emblem which is reproduced below: 

“10. Restriction on the use of the emblem.– (1) No person (including former functionaries of the Government, like, former Ministers, former Members of Parliament, former Members of Legislative Assemblies, former Judges and retired Government officials), other than those authorised under these rules, shall use the emblem in any manner.

(2) No Commission or Committee, Public Sector Undertaking, Bank, Municipal Council, Panchayat Raj Institution, Parishad, non-government organisation, University, other than those authorised under these rules, shall use the emblem in any manner.

(3) No association or body of persons, whether incorporated or not, shall use the emblem on their letter-heads, brochures, seats, crests, badges, house flags or for any other purpose in any manner.

(4) The stationery, including letter heads, visiting cards and greeting cards, with emblem printed or embossed on it, shall not bear words, like, Advocate, Editor, Chartered Accountant with the name of the person authorised to use the emblem under these rules on the stationery.”

This article highlights the use of emblems and State symbols, their misapplication for unnecessary gains and the role of the public to handle such precarious situations.

The intention of the Legislature while drafting the State Emblem of India (Prohibition of Improper Use) Act, 2005 and the Emblems & Names (Prevention of Improper Use) Act, 1950, is pretty clear in wanting to protect, prevent and shield the National Emblem and Names from being misapplied for unwarranted purposes. In Sable Waghire & Co. v. Union of India[5], the  Supreme Court while analysing the Emblems & Names (Prevention of Improper Use) Act, 1950, observed:

“17. We take it that the scheme disclosed in the provisions of the Act read with the Preamble, and the Objects and Reasons make it clear that there was imperative necessity for regulating the use of certain emblems and names. The fact that only improper use of the names and emblems is prohibited itself provides guidance. The original entries in the Schedule would also point to the nature and character of the names, emblems and entities. It is not possible for Parliament to envisage the possibility of improper use of all names and emblems as time goes on. Nor is it possible to enumerate in the Schedule an exhaustive list of all the names, emblems and entities. Section 8, therefore, makes provision for empowering the Central Government to add to or alter the Schedule. In the nature of things, there is no abdication of legislative function by Parliament in delegating its power under Section 8 in favour of the Central Government which will be the appropriate authority to consider from time to time as to the items to be included in or omitted from the Schedule in the light of knowledge and experience gathered from the nook and corner of the entire country. There is, therefore, no excessive delegation of legislative power by Parliament in favour of the Central Government. From the Objects and Reasons, the Preamble and the provisions of the Act with the built-in-limitations in Section 3 taken with the Schedule, a policy is clearly discernible and there is sufficient guidance therein to enable the Central Government to exercise its power under the Act….”

Therefore, the legislative intent while making laws to protect the emblems and names from being misused was to prohibit persons or organisations from using emblems, symbols or names for the purposes of trade, business, or any profession. 

        

 

 

 

                     

EMBLEMS AND SYMBOLS BEING MISUSED IN TIMES OF CRISIS?

It has been increasingly seen that some persons or organisations use the emblems to give an impression that they belong to the Government or make such a claim (expressly or impliedly) that the document on which such emblems and symbols are inscribed, are official government documents or documents endorsed by the Government.  Some non-governmental organisations, private organisations, and other entities blatantly misuse the Indian Emblem and State symbols to earn profits through advertisements, promotions, brochures, flyers, and handouts of their projects. With the usage of emblems and State symbols, common people are misled and they end up falling prey to such misapplication of emblems and State symbols. The onus to prove the genuine use of emblems or symbols is on the person using the same and the public has the right to know what is authentic and what is fallacious.

In times of a pandemic, crisis or calamity, private organisations often reach out to the general public for donations, funds and contributions for the poor and the downtrodden sections of the society which is commendable but the authenticity of such an organisation is of paramount importance otherwise people might end up getting duped and their donations will never reach the intended recipients. We have repeatedly seen some private and non-governmental organisations taking a humongous advantage especially in situations of extreme urgency to apply the National Emblem for their cause which is an unlawful thing to do and if a person is found guilty, he shall be punished with an imprisonment or with fine or both under the State Emblem of India (Prohibition of Improper Use) Act, 2005 and the Emblems & Names (Prevention of Improper Use) Act, 1950. The penalty prescribed under the State Emblem of India (Prohibition of Improper Use) Act, 2005 is reproduced below:

7. Penalty.— (1) Any person who contravenes the provisions of Section 3 shall be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to five thousand rupees, or with both, or if having been previously convicted of an offence under this section, is again convicted of any such offence, he shall be punishable for the second and for every subsequent offence with imprisonment for a term which shall not be less than six months, which may extend to two years and with fine which may extend to five thousand rupees.

(2) Any person who contravenes the provisions of Section 4 for any wrongful gain shall be punishable for such offence with imprisonment for a term which shall not be less than six months, which may extend to two years and with fine which may extend to five thousand rupees.”

The private organisations often make people believe that they are State-backed organisations which they are not and people get affected and misled by such wrong notions and representations. People, believing that such organisations are pre-vetted by the Government find such organisations much more reliable than most and, as a result, often end up donating to the most undeserving organisations.

SOME LOOPHOLES WHICH NEED PLUGGING

The National Emblem can be used only by those persons who find a mention in Schedules I, II and III to the State Emblem of India (Regulation of Use) Rules, 2007. It can also be used by any person or a group of persons, association, body, corporate, only in connection with an event organised by it or a publication brought out jointly with a Ministry or Department of the Central or State Government, with the prior approval of the Central Government as per Rule 11 of the State Emblem of India (Regulation of Use) Rules, 2007.

Section 3 of the State Emblem of India (Prohibition of Improper Use) Act, 2005, prohibits the improper use of emblem and it is reproduced as under:

3. Prohibition of improper use of emblem.—Notwithstanding anything contained in any other law for the time being in force, no person shall use the emblem or any colourable imitation thereof in any manner which tends to create an impression that it relates to the Government or that it is an official document of the Central Government, or as the case may be, the State Government, without the previous permission of the Central Government or of such officer of that Government as may be authorised by it in this behalf.

Section 4 of the State Emblem of India (Prohibition of Improper Use) Act, 2005, prohibits the use of emblem for the purpose of any trade, business, calling or profession or in the title of any patent, or in any trade mark or design. In the same way, under the Emblems & Names (Prevention of Improper Use) Act, 1950, Section 3 prohibits the use of emblems and names, reproduced as under:

3. Prohibition of improper use of certain emblems and names.—Notwithstanding anything contained in any law for the time being in force, no person shall, except in such cases and under such conditions as may be prescribed by the Central Government, use or continue to use, for the purpose of any trade, business, calling or profession, or in the title of any patent, or in any trade mark or design, any name or emblem specified in the Schedule or any colourable imitation thereof without the previous permission of the Central Government or such officer of Government as may be authorised in this behalf by the Central Government.”

Therefore, it is apt to enunciate that the NGOs or individuals cannot use emblems and State symbols without the nod of the Central Government as mentioned in the Acts. It must be made mandatory for all the NGOs or other organisations who use the emblems and symbols to undertake that permission has been granted to them for using the emblems and symbols so that people do not get misled and there is absolute authenticity while making contributions to such organisations. A common man will be able to know that the usage of emblem and symbol is valid only when NGOs or other organisations are mandated to disclose the factum of permission having been granted to them, be it on their websites, brochures, handouts, pamphlets, etc., otherwise common people will continue to fall prey to such shams, defeating the very purpose behind these legislations. Often the purpose of making a donation is urgent or time bound, it will not make sense if the only way to know whether the use of emblem is genuine or not, is by writing to the organisation or government authority.

The public at large needs to be vigilant and aware when it comes to donating money to such NGOs etc., who more often than not, do not have the permission to use the National Emblem or State Symbols in their projects. The emblem easily makes them fall prey to the mischief of such organisations. The people who come across such posters, pamphlets and brochures should first enquire thoroughly about the whereabouts and authenticity of such non-governmental organisations and for the best interest of the society at large, report it under the State Emblem of India (Prohibition of Improper Use) Act, 2005 and Rules 2007 or the Emblems & Names (Prevention of Improper Use) Act, 1950 and Rules, 1982.

CONCLUSION

The objective of the legislature while making laws for preventing the misuse of National Emblem and State Symbols was profusely clear as it wanted people not to get tricked by such violators who use these symbols and emblems without approval to make undue gains. Therefore, people have a moral and legal obligation to double check the organisations seeking donations (especially in the times of crisis) before making any contribution to them. If any organisation is found to be suspicious or doubtful, people must immediately report it under the State Emblem of India (Prohibition of Improper Use) Act, 2005, and the Rules 2007 or, the Emblems & Names (Prevention of Improper Use) Act, 1950 and the Rules, 1982. It is the need of the hour to formulate significant guidelines regarding the usage of emblems and State Symbols for the non-governmental organisations, etc., which will be of great importance in diminishing the existence of spurious organisations and in regulating the use of emblems and symbols. The Central Government needs to perform better than usual in response to this malpractice which is prevalent everywhere in the country and furnish significant guidelines to curb it. Citizens also need to be vigilant while donating money. A clear undertaking must be made mandatory so that the objective of the legislature is not defeated. The present long-drawn and unclear way of finding the authenticity of an individual/organisation using such emblems/symbols is a classic case where (at best) the stable door is shut after the horse has bolted. It must, therefore, be made mandatory to disclose that permission under law has been obtained each time the emblem or symbol, as covered under the aforementioned Acts and Rules, are used. Consequent directions must be sent to all publishers to exercise due care and to refuse publication of any such advertisements etc., where such symbols/emblems have been used, unless accompanied by an undertaking (to be published as well) that the requisite permission under law has been obtained.


* Partner at L&L Partners

** Student of BA LLB (4th Year), Lloyd Law College/Intern at L&L Partners.

[1] State Emblem of India (Prohibition of Improper Use) Act, 2005    

[2] State Emblem of India (Regulation of Use) Rules, 2007

[3] Emblems & Names (Prevention of Improper Use) Act, 1950

[4] Emblems & Names (Prevention of Improper Use) Rules, 1982

[5] (1975) 1 SCC 763