LAXMIKANT V. PATEL versus CHETANBHAI SHAH AND ANR.

Citation: [2001] SUPP. 5 S.C.R. 435 · Decided: 04-12-2001 · Supreme Court of India · Bench: R.C. LAHOTI · Disposal: Appeal(s) allowed

Judgment (excerpt)

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LAXMIKANT V. PATEL 
v. 
CHETANBHAI SHAH AND ANR. 
DECEMBER 4, 2001 
[R.C. LAHOTI AND K.G. BALAKRISHNAN, JJ.] 
Trade mark and Trade name : 
Passing o,(f-Trade or service marks-Elements o,f passing-off action are 
reputation of goods and/or services, possibility of deception and likelihood of 
damages. 
Civil Procedure Code, 1908-0rder 39 Rules I & 2-Passing o,(f ac-
tion-Temporary Injunction-Refusal to grant interlocutory injunction-Inter- · 
ference with exercise of discretion can be made when discretion is shown to 
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have been exercised arbitrarily or capriciously or perversely or where there is 
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.failure to apply settled principles o,f law-Held, on .facts, case for interference 
made out-Practice and Procedure-Constitution (}f India, 1950-Article 136. 
Appellant-plaintiff was conducting business of colour lab and studio 
in the name and style of Muktajivan Colour Lab and Studio and when the 
respondent-defendants, who were carrying on similar business in the name 
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of Gokul Studio, intended to adopt the name of Muktajivan Colour Lab 
and Studio for similar business, appellant initiated passing off action agaisnt 
the respondents on the ground that he had earned reputation and devel-
oped goodwill associated with the said trade name and sought permanent 
preventive injunction restraining respondents from passing off their busi-
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ness, service and goods as of and for the business, service and goods of the 
appellant. The appellant also filed an application seeking ad-interim in-
junction. Trial Court after granting ex-parte injunction dismissed the 
application and the said order was upheld in appeal by the High Court. 
Hence this appeal. 
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Allowing the appeal, the Court 
HELD : 1. Law does not permit any one to carry on his business in 
such a way as would persuade the customers or clients in believing that the 
goods or services belonging to someone else are his or are associated 
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435 
436 
SUPREME COURT REPORTS 
[2001] SUPP. 5 S.C.R. 
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therewith. It does not matter whether the latter does so fraudulently or 
otherwise. An action for passing-off will then lie wherever the defendant 
company's name, or its intended name, is calculated to deceive, and so to 
divert business from the plaintiff, or to occasion a confusion between the 
two businesses. The three elements of passing-off action are the reputation 
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of goods, possibility of deception and likelihood of damages to the plaintiff. 
The plaintiff does not have to prove actual damage in order to succeed in 
an action for passing off. Likelihood of damage is sufficient. 
[441-F; 441-B; 442-G] 
Law ~f Trade Marks and Trade Names by Kerly, Twelfth Edition; Law 
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of Torts by Salmond & Heuston, Twentieth Edition; Law of Passing off by 
Christopher Wadlow, 1995 edition, referred to. 
Oertil v. Bowman, (1957) RPC 388, referred to. 
2. In an action for passing off it is usual, rather essential, to seek an 
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injunction temporary or ad-interim. The principle~ for the grant ~f such 
injunction are that the plaintiff must prove prima facie case, availability of 
balance of convenience in his favour and his suffering an irreparable 
injury in the absence of grant of injunction. Once a case for passing off is 
made out the practice is generally to grant prompt ex-parte injunction 
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followed by appointment of local commissioner, if necessary. As to how the 
injunction granted by the Court would shape depends on the facts and 
circumstances of each case. [442-H; 443-C; 444-B] 
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3. It is the word 'Muktajivan' the employment of which makes 
distinctive the business name of the plaintiff and it is the continued use of 
'Muktajivan' in the business name of the plaintiff which has created a 
property therein linked with the plaintiff. The plaintiff is expanding his 
business and exploiting the reputation and goodwill associated with 
Muktajivan in the business of Colour Lab and Photo by expanding the 
business. On or about the date of the institution of the suit the defendant 
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was about to commence or had just commenced an identical business by 
· adopting the word Muktajivan as a part of his business name although till 
then his business was being run in the name and style of Gokul Studio. The 
intention of the defendant to make use of business name of the plaintiff so 
as to divert his business or customers to himself is apparent, Simply 
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because the business under the offending name had already commenced 
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LAXIKANT V. PATEL v. CHETANBHAI 

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