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A suit for passing off can continue even when suit for infringement was liable to be stayed: High Court of Delhi

A lawsuit filed for passing off to protect an unregistered trademark can continue even when the trademark infringement suit was liable to be stayed under Section 124 of the Trade Marks Act. This was upheld in the judgement passed by a bench of the High Court of Delhi consisting of Justice Asha Menon in the case of Parveen Kumar Gupta v Ravi Chadha & others [CM (M) 428/2021, CM APPL 20526/2021] pronounced on 6th August 2021.

The petitioner, Parveen Kumar Gupta was first aggrieved over the fact that a lawsuit he filed against the defendants for trademark infringement and passing off their goods as his was stayed by the Trial Court. The order which was passed by ADJ-02 Central Delhi, permitted the petitioner to withdraw his petition and granted him liberty to approach the Tribunal by review petition. Upon filing a review petition, the Trial Court held that the review petition had been filed beyond the period of limitation and refused to accept the petitioner’s application under Section 5 of the Limitation Act. As a result of this the petitioner’s Review Petition was also dismissed. He filed the present petition under Article 227 of the constitution praying that the High court of Delhi quashes the impugned order, allows for the application under Section 5 of the Limitation Act and finally allows for the Review Petition dated 22nd January 2018 filed by the petitioner under Section 144 of the Code of Civil Procedure 1908.

The petitioner’s counsel cited the case of J.K. Oil Industries v. Adani Wilmar Limited [2018 SCC OnLine Del 9367] to contend that when a suit is filed for infringement of trade mark as also for passing off, the filing of a rectification petition before the Intellectual Property Rights Board would result in the stay of the suit as far as infringement of trademark was concerned under the Act, however the suit should be allowed by the court. The court noted that it was settled law that Section 124 of the Trade Marks Act does not provide for stay of action in cases of passing off and is furthermore applicable only if an application for rectification or cancellation has been sought against the registered trademark and the plaintiff contends exclusively belongs to himself.

Justice Asha Menon concluded in the judgement that “The learned Trial Court has misread the judgments of this court in Micolube India Ltd. (supra) and Data Infosys Ltd. (supra), and there is an error apparent on the face of the impugned order. The learned Trial Court ought not to have directed that the entire suit be stayed, though, this court, including in J. K. Oil Industries (supra) has consistently held that while the suit for infringement of trade mark has to be stayed under Section 124 of the Trade Marks Act, when a rectification petition is filed before the IPRB, an action for passing off could continue.” The petition was allowed accordingly.

Click here for the judgement

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