MR. RAMAN KWATRA & ANR.  v. KEI INDUSTRIES LIMITED

Rajdip Das

Techno India University

CITATION:

2023 SCC ONLINE DEL 38

FACTS OF THE CASE:

The case is between KEI Industries Limited, a company that manufactures and sells wires and cables, and Raman Kwatra and his sole proprietorship firm, which manufactures and sells electrical fans and other appliances. The dispute is centred around the usage of the mark “KEI” by the Appellants concerning their goods, which the Respondent claims infringes its registered trademarks.

The Respondent alleges that it has been using the mark “KEI” since 1968 and has obtained various registrations for the word mark “KEI”, hereby referred to as the device mark and other trademarks in different classes. The Respondent claims that the trademark “KEI” has gained recognition and a positive repute in the market, and is closely linked with the goods and services they provide. The Respondent further claims that the Appellants have been using the disputed trademark for electrical goods or instruments, which are similar or allied to the Respondent’s goods. The Respondent argued that the usage of the disputed mark of the Appellant could create confusion and deception among the consumers and dilute the distinctive character and repute of the Respondent’s trademarks.

The Appellants deny the allegations asserted by the Respondent and assert that they adopted the trademark in a bona fide manner in 2008 and have been using it since then. The Appellants argued that the disputed trademark originates from the initials of their trade name “Kwality Electrical Industries”, which was coined by the father of Appellant no.1 in 1966 and registered as a label mark in 1997. The Appellants claimed that they have also obtained the trademark registration in class 11 in 2021. The Appellants argue that the trademark is neither identical nor similar to the trademark of the Respondent and that there is no probability of deception or confusion as the goods produced by the parties are different and cater to different segments of customers. The Appellants also invoke the defence of honest and concurrent use and estoppel, as the Respondent had admitted before the Trade Marks Registry that there was no ground for confusion between the marks of the parties.

An interim injunction was granted by a single judge of the High Court of Delhi in favour of the Respondent. The judge held that the Appellants have infringed the registered word mark “KEI” of the Respondent. The judge held that the Respondent has preliminarily established a case of Trademark Infringement. The single judge rejected the Appellants’ defence of honest and concurrent use, estoppel, and dissimilarity of goods. The single judge also observed that the Appellants are barred from using the Kwality label as it is registered in the name of Appellant No. 1’s brother. The single judge prohibited the Appellants from using the disputed trademark or other similar trademark that resembles the Respondent’s trademarks until the lawsuit was resolved.

ISSUES RAISED:

The main issues identified by the court were:-

  1. Whether the Appellant has infringed the Respondent’s registered trademarks by using the disputed trademark or other similar trademark that resembles the Respondent’s trademarks in relation to electrical goods or instruments?
  2. Whether the respondent can claim that the disputed trademark is similar to its registered trademarks after stating before the Trade Marks Registry that both trademarks are not similar?

CONTENTIONS:

Respondent’s Argument

The Respondent, KEI Industries Limited, argued that the Appellant, Raman Kwatra and his firm, infringed its registered trademarks by using the disputed trademark “KEI” about electrical goods or instruments, that are similar or allied to the Respondent’s goods. The Respondent claimed that the mark “KEI” has acquired repute in the market and is associated with its goods and services. The Respondent argued that if the disputed trademark is used by the Appellant, it is likely to cause confusion and deception among the consumers and dilute the distinctive character and repute of the trademark of the Respondent. The respondent accuses the Appellant of attempting to unlawfully profit from the Respondent’s good name and repute, as well as its trademark. The Appellant was accused by the Respondent of not having the authority to use the Kwality Label. The Respondent also accused that the Kwality Label features the letters “KEI” in the same font and style as the trademarks owned by the Respondent. The Respondent sought a permanent injunction against the Appellant restraining him from using the disputed trademark or any similar trademark that resembles the Respondent’s trademarks until the suit was resolved.

Appellant’s Argument

The Appellant, Raman Kwatra and his firm denied the allegations of the Respondent and asserted that they had adopted the trademark in a bona fide manner in 2008 and have been using it since then. The Appellant claimed that the trademark is resulting from the trademark initials of “Kwality Electrical Industries”, which was coined by the father of the Appellant in 1966 and registered as a label mark in 1997. The Appellant claimed that they had also obtained the mark registration in class 11 in 2021. The Appellant contended that the trademark in question bears no resemblance to the Respondent’s trademarks and that there is no probability of deception as the goods of the parties are different and cater to different segments of customers. The Appellant also invoked the defence of honest and concurrent use and estoppel, as the Respondent had admitted before the Trade Marks Registry that there was no ground for confusion between the marks of the parties. The appellant made the argument that the utilization of the disputed mark did not violate the registered trademarks of the respondent. The reason for this was that the conditions claimed under Section 29(4)(c) of the TM Act were not met.

RATIONALE

  1. The similarity of goods: The legality of the Appellant’s use of the disputed trademark was assessed by the court based on the similarity between the products in question and related products concerning which the respondent’s trademarks were registered and whether there was a probability of deception or confusion among the consumers. The court discovered that the respondent’s trademarks did not cover electrical appliances such as Immersion rods, fans, geysers, etc., which were the goods dealt with by the Appellant. The words “other kinds of electrical and electronic instruments” in the respondent’s device mark registration were interpreted by the court using the rule of ejusdem generis and noscitur a sociis. and held that they would not cover all electrical appliances, but only those that are related to conduction and manipulation of electricity. The court, therefore, concluded that the Appellant’s goods were not similar or allied to the Respondent’s goods and there was no breach under Section 29 (2).
  1. The estoppel against the respondent: The court considered whether the respondent can claim that the disputed trademark is similar to its registered trademarks after stating before the Trade Marks Registry that both trademarks are not similar and obtaining registration based on the fact. The court discovered that in the response to the Examination Report, the respondent claimed that its services were distinct from those of the cited marks, including the disputed trademark. The court held that the respondent could not make a contrary assertion in the suit and claim that the Appellant’s goods were similar to its goods and services. The court observed that the statements made by a person before the Registry of Trade Marks should be held against them when approaching the court. It is not permissible for a party to make a factual assertion that contradicts what they have claimed before the Registry.
  1. The Appellant’s registered trademark: The court decided that the trademark, Pedestal Fan Label in Class 11, had been registered by the Appellant. The learned Single Judge has made a mistake by not taking into account the Appellant’s registered trademark and instead basing the proceedings on the assumption that none of the trademarks used by the Appellant were registered trademarks.

DEFECT OF LAW

The single judge’s failure to consider the statements made by the respondent before the Trade Marks Registry was also an effect of the law. The single judge’s failure to consider the appellant’s registered trademark was the legal defect in this case. The single judge failed to conclude that the Appellant’s goods were not similar or allied to the Respondent’s goods and it did not cause a deception or confusion among the consumers.

INFERENCE

The judgment of the division bench of the High Court of Delhi is a well-reasoned one, which overturns the erroneous order of the single judge that granted an interim injunction in favour of the respondent. The division bench correctly applied the rules of ejusdem generis and noscitur a sociis and interpreted the scope of the respondent’s device mark registration and found that it does not cover Immersion rods, electrical fans, geysers, etc which were the goods dealt by Appellant. The division bench also rightly holds that the respondent cannot claim that the disputed trademark is similar to its registered trademark of the respondent after stating before the Trade Marks Registry that both trademarks are not similar and making the representation before the Registry that its services were different from the cited marks. The division bench further takes into account the fact that the Appellant has a registered trademark incorporating the disputed trademark in Class 11 and has clarified the purpose for using the disputed trademark, as it was derived from the Kwality Label, which was used by his father and predecessor in the business. The division bench judgment is a positive development in the law of trademarks, which set a precedent that parties are not allowed to make contradictory assertions or obtain an undue advantage of their registered trademarks.