(1.) Interpretation of the provisions of the Trade and Merchandise Marks Act, 1958 (for short "the 1958 Act") arises for consideration in these appeals arising out of a judgment and order dated 08.05.2003 passed by the High Court of Gujarat at Ahmedabad.
(2.) The appellant is a Company incorporated under the Companies Act, 1956. The other parties to these appeals were/are its Directors.
2.1. In the year 1965, one Rambhai Patel started a business of grinding and selling spices under the name and style of 'Ramdev'. He had three sons and two daughters, Arvindbhai, Hasmukhbhai and Pravinbhai were his sons. A partnership firm was constituted in the year 1975. It applied for registration of the trade mark 'Ramdev', which was granted on 03.01.1986 being Trade mark No.447700. Another partnership deed was executed in supersession of the earlier partnership deed wherein new partners were inducted. On 06.01.1989, the appellant-Company was incorporated whereby and whereunder the pattern of shareholding amongst the three brothers was : Arvindbhai Group (40%); Hasmukhbhai Group (30%); and Pravinbhai Group (30%). The registered trade mark was assigned by 'Ramdev Masala Stores' in favour of the appellant by a deed dated 20.05.1990. However, by the said deed the goodwill was not assigned. The trade mark together with the goodwill was assigned in favour of the appellant-Company by another deed of assignment dated 20,05.1992. A 'user' agreement was also entered into by the same parties permitting the firm 'M/s. Ramdev Masala Stores' to use the said trade mark subject to the terms and conditions stipulated therein. Another partnership firm being 'Ramdev Masala' was started on 01.04.1991 for carrying on the trade of grinding and trading of masalas. A user agreement was also entered into by and between the appellant-Company and the said firm permitting the latter to use the registered trade mark for seven years, i.e. from 01.04.1991 to 31.03.1998 in terms whereof it was stipulated
"3. AND WHEREAS the User is a firm registered under the Indian Partnership Act and wishes to use in the city of Ahmedabad except the area of Naroda City of Ahmedabad and district Mehsana, Gujarat State (India) registered proprietors ( ) aforesaid registered Trade Mark (hereinafter referred to as "the said Trade Mark") in respect of the said, goods." User restrioted to the cities of Ahmedabad and Mehsana;
4(C) That the User will continue to use the said mark only so long as he manufactures his goods in accordance with the terms and specifications devised by the Registered Proprietor.
4(E) That within the terms of this agreement and thereafter the User will not acquire any right to the said mark by any s means whatsoever except in accordance with law.
4(G) That the User covenants not to use the said Trade Mark in the advertisement, journal label and/ or other documents in such a manner that the said Trade Mark may in any way be diluted in respect of distinctiveness of validity if necessary and indication either usually, phonetically may be given to the purchasing public to the extent that the User uses the said mark by way of permitted use only."
2.2. Indisputably, the firm' Ramdev Masala Stores' was dissolved on 04.11.1991. Yet again a new partnership firm came into being under the name and style of 'Ramdev Exports'. The said partnership firm was constituted for the purpose of export of spices manufactured by the appellant-Company.
2.3. It is not in dispute that the business of manufacturing and selling of spices under the trade name of 'Ramdev' was being run by the three brothers through the appellant-Company.
2.4. Another partnership firm being 'Ramdev Masala' was being run through seven outlets for retail sale of the products of the company.
2.5. It is also not in dispute that both the firms 'Ramdev Masala' and 'Ramdev Exports' had distinct and separate existence. Their areas of operation were also different.
The respective roles assigned to each of the partnership firm had clearly been specified in their respective partnership deeds. Whereas M/s. Ramdev Masala was allowed to manufacture and trade in spices, the business of M/s. Ramdev Exports was limited to export of the spices manufactured by the appellant-Company. Yet again, the partnership deed of Ramdev Masala was amended on 01.04.1995; in terms whereof the business of the said firm was confined only to trading in spices manufactured by the appellant-Company. In other words, the respective businesses under the partnership deeds of the said firms are stated to be as under:
a. Type of business of Ramdev Masala under the first partnership deed was grinding and selling of spices. b. Type of business of M/s. Ramdev Masala under the second partnership deed was trading in spices. c. The business of M/s. Ramdev Exports was exporting the goods manufactured by the appellant-Company.
(3.) Disputes and differences having arisen between the members of the family and in particular between the three brothers, the same was settled by their well-wishers, pursuant whereto and in furtherance whereof a Memorandum of Understanding (MOU) was executed by and between the parties, to which we would advert to a little later.;