Ajay Auto Products vs Highway Cycle Industries

Z.S. Negi, J

This is an appeal preferred under Section 91 of the Trade Marks Act, 1999 (hereinafter referred to as the Act) against the order dated 16.6.2004

passed by the Assistant Registrar of Trade Marks, Delhi whereby he dismissed the opposition and ordered application to proceed for registration. The

Appellant has, along with the appeal, filed stay application being M.P. No. 82/2004 praying that during the pendency of the appeal the Registrar of

Trade Marks Delhi be restrained /injuncted from issuing the certificate of registration in respect of application No. 753365B in class12 to the

Respondent and stay in to the operation and effect of the impugned order dated 16.6.2004. This Appellate Board after hearing counsel of both the

parties passed order in the said M.P. on 4.12.2004 permitting the Assistant Registrar to proceed with other formalities excepting the issue of

certificate of registration until further orders or till disposal of the appeal.

The case of the Appellant-a firm trading in the name and style as M/s. Ajay Auto Products-is that it is engaged in the business of manufacturing

auto parts for motor land vehicles including ball bearings and roller bearings of all kinds, clutch and clutch parts, wheel parts and suspension parts, etc.

for more than three decades. It is the registered proprietor of the trade mark AJAY under registration Nos. 338371 as of 11.7.1978 in respect of auto

parts for motor land vehicles falling in class 12; 409817 as of 27.8.1983 in respect of ball bearings and roller bearings of all kinds falling in class 07 and

trade mark AJAX registered under N0. 338977 as of 26.7.1978 in respect of clutch and clutch parts, wheel parts and suspension parts all being parts

included in class 12 for motor land vehicles. The said registrations are legal and regular and being renewed from time to time and are still subsisting in

law. The Appellant is the owner of artistic work AJAY as well as packing material in the form of carton boxes registered under the Indian Copyright

Act, 1957. The Appellant has stated that the word AJAY is also forming a material part of its trade name and it has been using the trade marks

AJAY and AJAX, which were adopted in the year 1971 and thereafter the marks are being used continuously and extensively in relation to the

aforementioned goods and the goods bearing the said trade marks have been practically distributed throughout the country through its distributor M/s.

Ajay Auto Limited, a family group unit of the Appellant having its registered office at Pankha Road, New Delhi and branch office at Desh Bandhu

Gupta Road, Karol Bagh, New Delhi. The goods bearing the said trade marks/labels are highly demanded in the markets on account of their standard

quality and precision and the products bearing the trade marks of the Appellant have acquired tremendous goodwill and vast reputation as high quality

products originating exclusively from the Appellant. The Appellant has claimed that it has already built up a valuable trade under the said trade

marks/labels and claimed that the public at large associates the said trade marks and packing material with the goods of the Appellant alone and that

the Appellant has been using them since 1971 extensively and to the exclusion of all others. The Appellant claimed to have widely advertised the said

trade marks and packing material through advertisement in newspapers, distribution of trade literature, display boards and trade novelties and have

spent substantial and sizable sum of money on the publicity thereof.

The Respondent herein applied on 25.2.1997 for registration of the trade mark AJAY under application No. 753365-B for registration in class 12 in

respect of bicycles parts claiming the use of the said mark since 1.4.1988. The application, before acceptance, was advertised in the Trade Marks

Journal No. 1288 (Supplementary) III, dated 13.2.2003 at pages 136-137 and thereupon, the Appellant on 9.4.2003 filed opposition being No. DEL-T-

4783/75168 opposing the registration of the mark as advertised in the Journal on the grounds, inter alia, that the registration of trade mark applied for is

neither distinctive nor capable of distinguishing and that it is not adapted to distinguish the Respondent's goods, therefore, the mark does not qualify the

requirement of registration under Section 9 of the Act; that the mark is identical with and deceptively similar to the trade mark AJAY and AJAX of

the Appellant and it is likely to deceive or cause confusion; that the use of the Respondent's mark would be in infringement of the Appellant's

registration which could be restrained by the court and as such the mark is disentitled to protection in the court of law; that the Respondent is not the

proprietor of the trade mark and that the Respondent has no reason whatsoever for adoption of the trade mark AJAY except to take the advantage

of, and to trade upon, the reputation of the Appellant and to create deception and confusion in the markets and to pass off its spurious goods as that of

the goods of the Appellant.

The Respondent filed counter-statement dated 3.10.2003 denying the material averments made in the notice of opposition. The Appellant did not file

any evidence in support of opposition but it relied upon the statement made in the notice of opposition and thereafter the Respondent filed its evidence

in support of application for registration by way of affidavit dated 14.2.2004 of Mr. Darshan Singh-the proprietor of the Respondent. The Appellant

filed its rebuttal evidence by way of affidavit dated 28.3. 2004 affirmed by Mr. Vinod Kumar Sharma-proprietor of the Appellant firm. After

completion of the procedural requirements, the matter was set down for hearing on 4.6.2004; the said hearing concluded on the same day and the

Assistant Registrar of Trade Marks by his impugned order dated 16.6.2004 dismissed the opposition No. DEL-T-4783/75168 of the Appellant and

allowed the application No. 753365-B of the Respondent to proceed for registration.

Aggrieved by the impugned order, the Appellant has preferred the instant appeal on the grounds, inter alia, that the impugned order is erroneous in

law and on facts and the same is an non-speaking in nature; that the Assistant Registrar erred in dismissing the opposition on the ground of non-filing

of evidence in support of opposition without appreciating that the Appellant has relied upon the statement made in the notice of opposition; that the

Assistant Registrar has not recorded any finding on the objections raised by the Appellant under Section 9 or Section 11 or Section 12 or Section 18 of

the Act; that the Assistant Registrar has wrongly held that the Respondent appears to be honest and genuine proprietor of the trade mark AJAY

without assigning any reason therefor; that the Respondent has failed to discharge the onus to prove that its mark was entitled for registration; that the

Assistant Registrar failed to appreciate that the impugned mark was identical and deceptively similar with the registered trade mark of the Appellant

and the goods involved in both the competing marks were of the same description and similar in nature; that some of the documents filed by the

Respondent were fabricated and the same were not properly verified in accordance with the law; that the Assistant Registrar ought to have

appreciated that the Respondent was not honest and concurrent user and that the impugned order suffers from non-application of mind as the same is

passed mechanically and without due care and caution in the exercise of discretion vested in the Assistant Registrar of Trade Marks.

The Respondent on 7.11.2004 filed counter-statement to the appeal denying the material objections raised by the Appellant in its appeal. It is stated

that the Respondent has 16 years' user of the mark in respect of saddles and saddle covers for bicycles (i.e. Bicycle Parts) without any interruption

from any corner whatsoever, whereas the Appellant has, in the absence of any evidence adduced by it in support of the opposition, failed to prove the

actual use of its mark in the market. The goods of the Respondent are basically different from the goods of the Appellant as the Appellant is not

dealing with bicycle parts, therefore, there cannot arise any question of likelihood of causing confusion or deception in the market and also so far there

has been no incidence of any conflict or confusion noticed or occurred in the market and as such the Appellant has no cause of action against the

Respondent in the practical sense of the business activities. The word AJAY is name of the God and its adoption as trade mark by the Respondent is

honest, concurrent and bonafide. The Respondent while denying the allegation of passing-off has stated that the Appellant is well aware that there is

no question of any passing-off and, therefore, the Appellant very wisely did not file any suit against the Respondent. The Appellant had not made any

allegation regarding the genuineness of the documents filed by the Respondent before the tribunal and the Appellant did not insist for production of the

original documents at the time of the hearing before the Assistant Registrar of Trade Marks. The Respondent has claimed that its mark has become

distinctive and it has discharged its onus to prove the user by adducing sufficient evidence therefore. Lastly, it is submitted in the counter-statement

that the prayer on behalf of the Appellant is unlawful, illegal and vexatious and it is not entitled for any relief in the matter as prayed for.

The appeal came up before us for hearing on 27.10.2009, when Shri Saurabh Kapoor, advocate appeared for the Appellant and there was no

representative for the Respondent despite the fact that the Respondent has received the hearing notice dated 29.9.2009 and there was no request for

adjournment of the hearing. Learned Counsel for the Appellant insisted that the appeal should be heard and decided and accordingly, we have heard

the learned Counsel for the Appellant in the absence of the Respondent or its representative.

We have heard learned Counsel for the Appellant who submitted that the Assistant Registrar of Trade Marks erred in dismissing the opposition

filed by the Appellant for non-filing of evidence in support of the opposition. The Assistant Registrar has failed to appreciate that the Appellant has

relied upon the facts stated in the notice of opposition and this option of intimating to Registrar and the applicant in writing that the opponent does not

desire to adduce evidence but intends to rely on the facts stated in the notice of opposition is expressly provided for under Sub-rule (1) of Rule 50 of

the Trade Marks Rules, 2002 (hereinafter referred to as the Rules). The Registrar has also failed to appreciate that it was apparent from the record

that the Appellant already holds the registration of the trade marks AJAY and AJAX in its name and the Registrar being the custodian of the trade

marks, it is incumbent upon him to look into it and not to allow any other deceptively similar mark as that of the Appellant's mark to come on the

Register of Trade Marks. Learned Counsel for the Appellant by referring the decision in Century Traders v. Roshan Lal Duggar & Co. and Ors. AIR

1978 Delhi 250, wherein reliance was placed upon the decision of the Supreme Court in Corn Products Refining Co. v. Shangrila Food Products Ltd.

holding that the onus of proving user is on the person who claims it, submitted that the Registrar has failed to appreciate that the onus of proving that

the mark applied for is entitled to registration is on the person who seek registration but in this case, the Respondent has miserably failed to discharge

that onus. The Learned Counsel further submitted that the Respondent has not filed sufficient cogent evidence to sustain the claim of user of the

impugned mark and whatever documents adduced in evidence on behalf of the Respondent/applicant were not properly verified, originals of the copies

of documents filed in evidence were not produced by the Respondent and the same were fabricated and interpolated documents; also the same were

not filed in accordance with the provisions of Rule 116 (1) of the Rules and as such the documents adduced in evidence cannot be relied upon.

Learned Counsel is in support of his submission relied upon the decision of this Appellate Board in Jain Electronics v. Cobra Cables (P) Ltd. and Anr.

2005 (31) PTC 330 (IPAB) wherein the Appellate Board while considering whether the evidence produced by the Appellant establishes their use of

the mark COBRA observed thus:

The copies of invoices and the bills produced by the Appellant do not reveal that the Appellant had sold the Voltage Stabilizes under the brand name

COBRA. Some of the printed bills/invoices bear the name of the Appellant Jain Electronics. In those cash/credit memos, the monogram of Cobra

along with the word COBRA is printed. What is the significance attached to the monogram of the cobra along with the words is not clear. In the

description of goods sold by the Appellant, it is simply mentioned 'Automatic Voltage Stabilizer' without any reference to the trade mark. In such

circumstances, it is very difficult to accept the plea of the Appellant that they used the impugned trade mark in relation to the Voltage Stabilizers.

Unless the trade mark with the description of goods or the goods identified by the trade mark is mentioned in the bills or invoices, the relation between

the two cannot be in or cannot be said to have been established.

Learned Counsel went on to submit that it is glaringly clear that the Respondent has not discharged onus which lies on the applicant seeking

registration of trade mark, therefore the appeal in hand be allowed with cost in favour of the Appellant.

On the other hand, the Respondent, in its counter-statement dated 28.19.2004, has stated that the impugned mark having been in use for the last 16

years has become distinctive. The evidence filed by it was quite sufficient to prove the user of the mark and that it had also supplied a set of evidence

to the attorneys of the Appellant. The goods of both the parties are of different description; therefore, there is no question of any likelihood of

confusion in the market or passing off and as such the Appellant has very wisely not filed any suit against the Respondent. The Respondent was

entitled to registration as it had discharged the onus on its part. From the perusal of the documents available on record it is evident that the Appellant

had not adduced any evidence in support of notice of opposition and it has not established user or reputation of its mark. It would be appropriate to

quote the observation made by the Assistant Registrar in his impugned order, which reads as: ""I have heard both the counsels acting on behalf of the

opponents and the applicants. I have also perused the records of the file. The opponents have not filed documentary evidence in support of opposition.

They have only filed rebuttal evidence in which the opponents have merely denied the claims of the applicants. Due to non-filing of the evidence on

the part of the opponents, this Tribunal is reluctant to decide the various objections as raised by the opponents. In this matter the applicants appear to

be honest and genuine proprietor of the mark AJAY within the meaning of Section 18 of the Act. I am reluctant to discuss the opponent's objection

under Section 9, 11, 12 and 18 of the Act obviously due to non-filing of the documentary evidence by the opponents in this matter."" It is well settled

that the mere presence of trade mark in the register maintained by the Trade Marks Registry does not prove its user by the person in whose name the

mark is registered, therefore, the submission of the Appellant that the Registrar has failed to appreciate that the Appellant already hold the registration

of the trade marks AJAY and AJAX in its name is not sustainable as proof of user of those marks by the Appellant, especially in the absence of any

iota of documentary evidence to show the user. There is no dispute that the Appellant has relied on the facts stated in the notice of opposition but that

notice did not contain any material details to prove the claimed user of the mark since 1971 or reputation accrued to its mark or to prove the claim that

the mark has been continuously and extensively used in to the goods for which registration was obtained or the registered marks were widely

advertised and the Appellant has already spent substantial and sizable sum of money on the publicity of the mark. There is no explanation from the

Appellant as to why the documentary evidence, if existed, were not filed before the Assistant Registrar. Even the Appellant has not proved that goods

for which registration of trade marks have been obtained are available in the market or it has become vendible in the market. There is no material on

record (including the impugned order) to indicate that the Appellant or its counsel, at any stage of the matter, including during the course of hearing,

has not taken pains to stress the objection that the Respondent had not filed sufficient cogent evidence to sustain the claim of user of the impugned

mark or whatever documents adduced in evidence on behalf of the Respondent were not properly verified, originals of the copies of documents filed in

evidence were not produced by the Respondent or the same were fabricated and interpolated documents or the same were not filed in accordance

with the provisions of Rule 116 (1) of the Rules and as such the documents adduced in evidence cannot be relied upon. Such objections at this stage

cannot be permitted as the Appellant has waived the objection before the lower tribunal. The averment made by the Respondent in its counter-

statement that the Appellant had not made any allegation regarding the genuineness of the documents filed by the Respondent before the tribunal and

the Appellant did not insist for production of the original documents at the time of the hearing before the Assistant Registrar of Trade Marks has not

been rebutted by the Appellant at any stage. We have no opportunity to peruse the original documents filed by the applicant and the opponent before

the Registrar of Trade Marks as the Trade Marks Registry has forwarded a few scanned copies of opposition file and stated that the application file is

not traceable. However, the copies of documentary evidence in support of application filed by way of affidavit of Mr. Darshan Singh, proprietor of the

applicant firm, shows that the firm Highway Cycle was registered with the Central Sales Tax for the business of Cycle and Cycle Parts since April

1970 which shows that the Respondent was in cycle and cycle parts business since 1970. Para 4 of the said affidavit contains the turn over of the firm

from the year 1992-93 (which also includes the trade mark AJAY for cycle parts) which was Rs. 1,64,924.40 and it increased in the year 2002-2003

to the tune of Rs. 10,26,739. Random copies of invoices filed from 10.12.1988 to 29.11.2002 show that the trade mark HIGHWAY and AJAY are

printed on the invoices. We have failed to notice any interpolation or fabrication of invoices, except the invoice No. 5057 dated 10.12.1988 on which

the printed word AJAY is encircled in ink and pointed to the words TM AJAY (written in ink) by drawing an arrow line down wards. We are of the

view that this solitary instance is not sufficient to negate the entire evidence of user and even this cannot be termed as interpolation of trade mark or

fabrication of invoice. Even if we discard this invoice as evidence, there are other invoices and the sales figures since 1992-93 and copies of invoices

from 5.8.1989 which prove the user till the date of filing of application on 25. 2.1997. We are of the opinion that the Respondent has successfully

proved the user of its mark and has acquired the right of property in the impugned trade mark. The Bombay High Court in Consolidated Foods

Corporation v. Brandon and Co. Private Ltd. AIR 1965 Bom. 35 held that ""A trader acquires a right of property, in a distinctive mark merely by using

it upon or in connection with his goods irrespective of the length of such user and the extent of his trade..."" Mr. P. Narayanan in his book 'Trade

Marks and Passing off' (6th Edition) at Chapter 6 para 22 has stated that ""It is well settled that in an opposition proceeding the onus is ultimately upon

the applicant to establish that he is entitled to registration of the trade mark applied for. This also follows from the fact that there is no absolute right in

any one to obtain the registration of a trade mark. Where the objection to the application is based on the alleged use and reputation of the opponent's

trade mark, or on any other facts, the onus of establishing those facts lies upon the opponent. But once this initial onus on the part of the opponent is

discharged, the burden is on the applicant to show that the use of his mark is not likely to deceive or cause confusion. This onus is discharged by filing

evidence of relevant facts and submitting arguments at the hearing. In appropriate cases this can be done by arguments alone ..."" In the present case

the Appellant neither filed any evidence nor forwarded any argument during the course of hearing before the Assistant Registrar to discharge the said

onus. The decision of this Appellate Board in Jain Electronics (supra) as relied upon by the Appellant will be of no help to the Appellant as the facts of

the case relied upon is distinguishable. We are of the considered opinion that the Respondent had satisfied the Assistant Registrar that the mark

applied by it for registration was entitled for registration and hence it had discharged the onus on it to prove the entitlement of its mark for registration

on the basis of user. It is also notable that the averments made in paragraphs 6 and 7 of the affidavit of Mr. Darshan Singh have not been specifically

rebutted by the Appellant in the affidavit of Mr. Vinod Kumar Sharma-proprietor of the Appellant firm. In reply to the contents of paras 6 and 7

referred to above, the Appellant merely denied and stated that that the Respondents are passing off their goods as those of the opponents and are also

infringing the trade mark of the opponents and, therefore, not entitled to its registration. The Appellant has not replied or explained that if the

Respondent has indulged in passing off and infringement, why the Appellant has so far not initiated any legal action by way of filing a suit against the

Respondent for passing off and infringement against the Respondent so far. Regarding the averment made in the appeal that the Registrar ought to

have appreciated that it was not a case of honest and concurrent user, it is noticed that the Respondent in the counter-statement dated 28.9.2003 to

the notice of opposition has averred that "" As already stated our adoption is honest & user is concurrent & bonafide"" and this averment has not been

controverted by the Appellant at any stage in the proceeding before the Assistant Registrar. We are inclined to agree with the observation made by

the Assistant Registrar that he was reluctant to discuss the Appellant's objection under Sections 9,11,12 and 18 of the Act due to its non-filing of

evidence in support of its opposition and even the rebuttal evidence filed by the Appellant was nothing but mere denial. We are of the opinion that the

findings on objections raised under the above referred sections could only be made or based with reasons therefore by the Registrar on the

documentary evidence that might have been adduced in support of the objections. In other words, if the opponent has nothing to adduce to prove the

basis of its opposition to application for registration, such opposition can be termed as frivolous and vexatious and no other findings with reason can be

expected. We are unable to see any reason for interfering with the conclusion arrived at by the Assistant Registrar of Trade Marks.

Learned Counsel for the Appellant relying in the decision in American Home Products Corporation v. Mac Laboratories Pvt. Ltd. and Anr. 1986

(1) SCC 465, tried to emphasise that when a person gets his trade mark registered, he acquires valuable rights by reason of such registration.

Registration of his trade mark gives him the exclusive right to the use of the trade mark in connection with the goods in respect of it is registered and if

there is any invasion of this right by any other person using a mark which is the same or deceptively similar to his trade mark, he can protect his trade

mark by an action for infringement in which he can obtain injunction, damages or an account of profits made by the other person and in such action,

the registration of a trade mark is prima facie evidence of its validity. There is no dispute in the above observation of the court but it is irrelevant in the

present case. This plea does not form part of the pleadings and hence we are not required to go into the merits of this plea. Apart from this, we may

remember that this Appellate Board has jurisdiction to deal with appeal but has no jurisdiction to deal with the question of infringement and passing off.

This Appellate Board is therefore not suppose to consider the question as to whether the Appellant has exclusive right to the use of its mark in

connection with the goods for which the mark is registered and whether, in case of invasion of its right, it can protect its right by taking action against

infringement. However, we have already observed that though the Appellant has in its rebuttal affidavit stated that the Respondents are passing off

their goods as those of the opponents and are also infringing the trade mark of the opponents and, therefore, not entitled to its registration but the

Appellant has not replied in rebuttal or explained that if the Respondent has indulged in passing off and infringement, why the Appellant has so far not

initiated any legal action by way of filing a suit against the Respondent for passing off and infringement.

The result is that the appeal which is devoid of any merit must fail. Accordingly, the appeal is dismissed and the parties are left to bear their own

costs.