India: Asian Mills Ltd. Prohibited from Using "GUJARAT"

Last Updated: 21 March 2006
Article by Manisha Singh Nair

Hi-Tech Pipes Ltd., manufacturers of "Gujrat" steel pipes filed this suit against Asian Mills Pvt. Ltd., manufacturers of MSERW pipes, under the name "Gujarat". The suit aims at acquiring perpetual injunction to restrain piracy of trade mark, copyright, passing off and rendition of accounts.

Hi-Tech Pipes was established in 1985, began manufacturing in 1988 and adopted the said trade mark ‘Gujrat’ in its year of establishment, by the predecessors of the present owners. The company claims to have acquired through its trade mark secondary meaning and distinctiveness on account of its open, regular, continuous, extensive and exclusive use coupled with large scale publicity. The Company also claims to have registered its trade mark with respect to all kinds of steel tubes, before the Registrar of Trade Marks, New Delhi.

Asian Mills is a recent establishment in comparison to Hi-Tech Pipes using the name ‘Gujarat’ for its products. This company is accused of an attempt to pass off goods as that of the plaintiff by the use of a deceptively similar trade mark. These pipes being bought by general laborers, illiterate and semi-literate purchasers, mechanics, plumbers, etc., if the test of effect on an unwary customer be applied, it was stated that the deceptively similar mark was liable to cause confusion.

In pursuance of the matter, Hi-Tech Pipes had filed an application for interim relief along with the suit and ad-interim ex-parte orders were granted. In response to this, the Asian Mills filed a written statement and also an application for vacation of stay.

The contention made by Asian Mills Pvt. Ltd was that Hi-Tech Pipes could never have had an exclusive 0right in favour of the plaintiff in respect of the trade mark ‘Gujrat’. At this, the counsel for Hi-Tech Pipes submitted that Asian Mills had issued a notice informing of its exclusive right on ‘Gujarat’ and calling upon Hi-Tech to stop its use. While Hi-Tech submitted that it was the prior user, Asian Mills changed its stand completely, now stating that ‘Gujrat" was also a geographical name and hence could not be termed as a trade mark. Hi-Tech retorted to such change in contention stating that Asian Mills was bound by it admission in the legal notice. Asian Mills to this advancement said that they had not been properly legally advised and on such proper advice being rendered, they changed their stand.

In response to the above said, the Court declared that there was no doubt of Hi-Tech pipes being a prior user of the mark, but the issue to be addressed was the admissibility of ‘Gujarat’ as a trade mark. The Court held this case to be one of geographical mis-description since admittedly, Hi-Tech Pipes ltd. was based in Delhi and had no commercial nexus with the State of Gujarat. On the other hand the owners of Asian Mills Pvt. Ltd. hailed from Gujarat and the company is incorporated in the state. Thus, it was held that such a usage by Asian Mills Pvt. Ltd. was bona fide and amounted to descriptive usage of the mark.

The counsel for Asian Mills though, argued on the lines of a geographical term being used as a valid trade mark, which could be used only in exceptional circumstances. The counsel stated that the mark was neither descriptive, nor adapted to be capable of distinguishing the goods of Hi-Tech from those of others. They further submitted that it was in an attempt to wrongfully gain monopoly over the name of the State of Gujarat, that Hi-Tech Pipes had moved to Court.

Further, Asian Mills contended that the plaintiff was using a false form of advertising. They also submitted that only if a geographical name has inherent distinctiveness, could the same acquire distinctiveness. Citing the case of Liverpool Electric Cable Company, the counsel contended that the name of the state might be used only in situations where a common characteristic of vast quantities of goods could be attributed to a geographical area. They submitted that "Gujrat’ fell in the same category.

The counsel for Hi-Tech Pipes in retort to these arguments said that Gujarat as a state had never been known for tubes and thus could be uniquely used as a trade mark. They further cited that in case a particular product was known to hail from a certain place, then alone would it amount to be a geographical indication and hence the same would not be capable of use.

Referring to the Imperial Tobacco Company case (also cited by the counsel for Asian Mills), they emphasized that there has to be a strong evidence of distinctiveness. They further said that a mark can qualify incase it acquired secondary significance. They further emphasized that the principles applied to descriptive words be applied to geographical name. In support of their plea they cited various decided cases, and finally stated that if the contentions of the attorneys on behalf of Asian Mills were accepted, then corporations such as IOCL and Bharat petroleum would have to forgo the use of ‘Indian’ and ‘Bharat’ respectively.

The Court considering the various submissions made by the parties said that the suit amounted to be a case of passing off. The Learned Judge further suggested all the judgments referred to by the Counsel for Asian Mills were in respect of parameters to be fulfilled before registration of the trade mark. Admitting that both ‘Gujrat’ and ‘Gujarat’ were similar, if not identical, the issue raised by the Court was if Hi-tech Pipes was capable of abrogating itself to use the said mark or to preclude Asian Mills Pvt. Ltd. to use it in respect to its product on the ground that they had attempted to pass off their goods to be that of Hi-Tech Pipes’. The Court taking view of precedents and examples held that Hi-Tech pipes could not be disentitled from using the trade mark ‘Gujrat’ on the grounds of geographical mis -description. Addressing the issue pertaining to entitlement of exclusive rights vide being a prior user, the Court concluded that the trade name ‘Gujrat’ had acquired secondary meaning and distinctiveness and that Asian Mills being a later entrant in the field, it had made an attempt of passing off.

The Court thus was of the view the interim orders granted were liable to be confirmed during the pendency of the suit and restrained ‘Asian Mills’ from using the either of the trade marks ‘Gujarat’ or ‘Gujrat’.

© Lex Orbis 2006

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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