Name of the case: Brihan Karan Sugar Syndicate Pvt. Ltd. Vs. Yashwantrao Mohite Krushna Sahakari Sakhar Karkhan

Case Number: [Civil Appeal No. 2768 of 2023]

Name of Judges: Hon’ble Judges Abhay S. Oka and Rajesh Bindal

Order Date: 14/09/2023

Facts of the Case:

• The appellant-plaintiff is engaged in selling country liquor with the label “Tango Punch”. The respondent- defendant is engaged in selling country liquor with the label “Two Punch Premium”. The case of the appellant is that it has a copyright in the artistic label displayed on the bottles of country liquor sold by it.
• The appellant claimed permanent injunction restraining the respondent from infringing copyright in its artistic label either by reproducing the label or the substantial part of it in any material form by printing, publishing or using the label or any other work, which is an imitation or reproduction of the appellant’s label or substantial part thereof.
• In the suit, the appellant also prayed for a decree of injunction restraining the respondent from manufacturing, selling, offering for sale, advertising, or otherwise dealing in country liquor having the appellant’s trade mark label or any deceptively similar trademark label so as to pass off the country liquor of the respondent as and for the well-known country liquor of the appellant. After a complete trial, the learned District Judge decreed the suit.
• Being aggrieved by the said decree, the respondent preferred an appeal before the High Court. By the impugned judgment and order, the learned Single Judge of the High Court stayed the execution and the operation of the decree till the final disposal of the appeal.
• The appellant, who is the original plaintiff preferred this appeal for challenging the impugned judgment and order passed by the learned Single Judge of the High Court of Judicature at Bombay (Aurangabad Bench).

The Hon’ble Supreme Court Observed and Held as Follows:

• The Court observed that for establishing goodwill of the product, it was necessary for the appellant to prove not only the figures of sale of the product but also the expenditure incurred on promotion and advertisement of the product. Prima facie, there is no evidence on this aspect.
• While deciding an application for a temporary injunction in a suit for passing off action, in a given case, the statements of accounts signed by the Chartered Accountant of the plaintiff indicating the expenses incurred on advertisement and promotion and figures of sales may constitute a material which can be considered for examining whether a prima facie case was made out by the appellant-plaintiff. However, at the time of the final hearing of the suit, the figures must be proved in a manner known to law.
• Even assuming that the allegation of deceptive similarity in the labels used by the respondent was established by the appellant, one of the three elements which the appellant was required to prove, has not been proved. Therefore, we find that the High Court was justified in staying that particular part of the decree of the Trial Court by which injunction was granted for the action of passing off.
• With regard to the infringement of copyright. It is a well settled law that acquiescence is a defence available in action for the infringement of copyright. The Court laid reliance on its observations made in the case of M/s. Power Control Appliances & Ors. v. Sumeet Machines Pvt. Ltd, in which it held that if the acquiescence in infringement amounts to consent, it will be a complete defence. This Court also observed that acquiescence is a course of conduct inconsistent with the claim for exclusive rights and it applies to positive acts and not merely silence or inaction such as is involved in laches. This Court observed that mere negligence is not sufficient. 
• In the facts of the case, it appears that when permission was sought by the respondent to use the impugned labels, the appellant raised objections in writing to the grant of permission to the respondent to use the said labels. It is not as if those objections were not pursued, but there was a positive act on the part of the appellant of withdrawing the said objections by submitting the letters of withdrawal in which, admittedly, it was not mentioned that the withdrawal was conditional. This important factual aspect supports the order of stay granted by the High Court as regards the decree in respect of the infringement of copyright.
• Therefore, this Court held that the High Court was justified in granting the order of stay pending the final disposal of the appeal. The appeal is, accordingly, dismissed. The Supreme Court further clarified that the High Court, while deciding the pending appeal, it will not be influenced by the observations made in the impugned judgment as well as the observations made in this judgment.