Tea Board India v. ITC limited (2011)

COURT NAME: HIGH COURT OF CALCUTTA

JUDGE NAME: HON’BLE JUSTICE SAHIDULLAH MUNSHI

BENCH TYPE: Single Judge bench

DATE OF JUDGEMENT: Feb 04, 2019

PARTIES INVOLVED:

Plaintiff- Tea Board of India: The Union Government controls “tea” according to a law established by Parliament. In order to promote Indian tea both domestically and internationally, the Bill imposed a tax on tea products in India. The present Tea Board of India was created by repealing the earlier two statutory entities, the Central Tea Board and the Indian Tea Licencing Committee, which were operating under their respective Acts.

Defendant- ITC Ltd.: It is an Indian conglomerate, with its headquarters based in Kolkata. It manages namely FMGC, agricultural businesses, Info-Tech, Packaging and paper products. Its highest revenue grossing sector comes from the tobacco products. The ITC Limited derived its name originally from Imperial Tobacco Company Limited, later changed in the year 2001.

FACTS OF THE CASE:

Tea Board of India, also the plaintiffs in the present case intended to regulate all activities like producing, marketing, cultivating, exporting and sale of tea, also encouraging research, with various other duties mentioned under its respective act. They intended to protect the veracity of the name “Darjeeling,” where the plaintiff developed an idiosyncratic logo where the image was of a woman holding two tea leaves and a bud, with the “Darjeeling” as the name being prominently displayed over the top of the logo. For a certification trademark of the word “Darjeeling”, the plaintiff applied to be registered as the sole proprietor. By such virtue, the plaintiff claimed to be the sole owner of the name “Darjeeling.” The Geographical Indications Act, gave the name and logo “Darjeeling” their very first geographical indicators. The defendants owned an hotel, named Sonar Bangla. The plaintiffs soon caught a whiff of a trademark application made for the change of its name to “Darjeeling Lounge” when it was seen in advertisements. The plaintiff immediately objected the registration made by the defendants and it was ultimately known that by the operation of Sec. 21(2) of the Act, the application for registration of the hotel under the given name was to be rejected. However, it came to the knowledge of the plaintiff that the name was in continued fraudulent use by the defendant. The defendants use of the word “Darjeeling” for the use of a hotel, and its distribution of various beverages and eateries caused a misconstrued indication that they might have a connection to the place of Darjeeling or its infamous tea and hence caused unfair competition, as it discredits the tea and misleads its patrons. Hence, the suit was filed, praying for an interlocutory injunction, preventing the use of the name “Darjeeling Lounge” by the defendants while the suit was pending. [1]

ISSUES:

1. Whether the use of the name “Darjeeling Lounge” by the defendants is an act of infringement constituted under the Trademarks Act and the Geographical Indication Act.
2. Whether the use of the name by the defendants constitutes to dilution of plaintiff’s rights registered under geographical indication for the use of the word “Darjeeling.”-
3.  While acquiring the trademark registration for the right and authority to the use of the name “Darjeeling” referring to the tea of its GI, attain any other such right prohibiting the use of the name and its logo.
4. Did the name used to refer to the lounge in the hotel, deceive the members of public to believe that the all products sold at the hotel have any nexus to Darjeeling.

ARGUMENTS OF THE PARTIES:

• The defendant argued that the suit filed by the plaintiff was not maintainable in the court of law based on it being barred by the law of limitation. The counsel for the defendant further argued that the use of the name “Darjeeling Lounge” violated no trademark right of the plaintiff hence making it irrelevant for a cause of action to arise and a suit to be constituted, as the only right the plaintiff had on the GI was that of a certification trademark and not of the word “Darjeeling” itself, unless the word was to be fraudulently used to mislead customers, hence bringing about no cause of action valid under the Geographical Indication Act of 1999. The use of the word “Darjeeling” can not be sought after as a suit against the defendant as the word is used by various other corporations.[2]
• The plaintiff contented in the High court of Calcutta that upon discovery of the use of the name by the defendant, the plaintiff stated its rights by issuing a letter stating its unrestricted rights over use of the word “Darjeeling” and that the defendants attempt at using the same for a hotel was encroaching this right of the plaintiff, where the plaintiff then went on to file an opposition to this act of the defendant and not soon after did they receive a letter in reply by the defendant’s denial to stop the use of the name and that the trademark rights of the plaintiffs did not extend up to the use of the word “Darjeeling” at all instances. [3]
• The defendant in reply to this contention by the plaintiff stated that the use of the word “Darjeeling” to name a lounge of theirs was at an unsuccessful attempt to showcase a side of Bengal, just as various other hotels of the defendant were connected to this, in the ever-deprived Calcutta and much at its failure. The plaintiff briskly pointed out that the use of such a name to a lounge would be misleading especially when no products of this lounge bore any references to the actual place in question. The defendant accurately argued in its favour stating that the use of the name “Darjeeling Lounge” in its hotel which happens to be member exclusive only and not to just about anyone access it, and this name for the lounge has existed before the inception of the Geographical Indications Act, the statute under which it is untenable. Under Sec.26 (4) of the Geographical Indications act, where once a suit has been instituted 5 years after the happening of the act, the against whom the suit is filed can be provided protection under this section. And the defendants claim to have provided various kinds of beverages and eateries in the lounge which would in no way cause a misrepresentation to the members of the lounge as this was in no attempt to deceive the clients of these products to have been originated from the place contented by the plaintiff in the cause of action against the defendant. [4]
• The plaintiff has argued that the use of the certain marks by the defendant relating to the logo happened to be somewhat similar to that of the plaintiffs hence infringing their right over the trademark of the logo, but this is contrary to what was stated by the plaintiffs in the plaint, as the plaintiffs only mentioned the use of the name “Darjeeling Lounge” to be an infringement of their right rather than the use of certain marks. The plaintiff placed another argument that according to the Law of Torts, the intention to deceitfully use the name can bring about a new suit in favour of the deceived as long as the intention to deceive exists. However, in the current case, there seems to be no act of deceit whatsoever, nor is there any new plaint filed by any third party to the suit regarding any deceit caused by the defendant through the subject of this suit hence making the argument of the plaintiff extraneous in this context.[5]

JUDGEMENT:

1. With respect to the right of the plaintiff in relation to their certification trademark, the registration can be done either for the goods aspect of the trademark or its services aspect. In relation to a trademark for goods, it can be trademarked based on its origin, the kind of material being used or even the manner of production of such a good and in case of service trademark, it can be based on the accuracy of similarity to the trademark, or its quality or any other features specific to the object trademarked. It is vital to understand the difference between the two, since the two trademarks do not overlap, hence their usage will also depend on different factors. Hence, a certification on the mark of “Darjeeling” by the plaintiff cannot be unjustified by the defendants and the use of the mark by the defendants to make it indicative that the products are of Darjeeling origin would encroach on the GI and certification trademark by the plaintiff. [6]
2. The matter of dilution with respect to the name in dispute, the word is not foreign to the nomenclature in the trading and commercial industry, and this has existed for decades together before the Geographical Indication Act even came into being. In the present case, only the uniqueness of the mark to the plaintiff stands protected against use, but the vicarious use of the name is not unbeknownst between organizations. This hence makes it difficult for the plaintiff to gain from their cause of action, as the exclusivity to the use of the name remains unjustified, even by the act, as the name can be used even without specific indication to its Geographical indication. [7]
3. Due to the extensive use of the word “Darjeeling”, and it being the signature to a Darjeeling tea, it makes it nearly impossible for the plaintiff to claim exclusive rights for the name “Darjeeling” irrespective of their certification trademark for it. The only way that the plaintiff can claim the word as a GI would be if the user of such a word other than the plaintiff, uses it as an indication to the place of the GI to represent the products to such a nexus. It is not necessary that a tea retailing place be considered as to infringe the rights of the plaintiff when the tea stall be worded with “Darjeeling” in its name, rather, even the intravenous use of the word to sell any other product which may cause an indication or misrepresentation to the consumers of it having connection to the place in the name will also entitle the plaintiff to sue. But the mere use of “Darjeeling” to name a lounge, frequented by only high-end customers, where even Darjeeling tea may be sold, but this in no way serves as deception to the customers of such lounge to believe that the source of such products be from the origin of its name.
4. Hence, since the suit filed by the plaintiff was unmaintainable on the grounds of infringing the rights of the certification trademark obtained through registration by the plaintiff, the suit was dismissed by the learned single judge with cost of Rs. 1,00,000/- with no objections by the Senior counsel of the defendant.

LEGAL ANALYSIS:

The case from its very inception was misconceived to be maintainable as there no valid grounds on which such suit could stand. The very objective of the geographical indications act is concerned with goods connected to their origin of geographical indications in India. Although, foreign courts have given supporting arguments to the contrary, but none stand validated to the current dispute being unrelated to those foreign judgements. Hence, all foreign cases used by the plaintiff to support their case, are not considered by the court. Now comes the question of passing off the name by the defendant to a lounge using products to have been originated from Darjeeling. Since, the plaintiff is neither the user of the name “Darjeeling” nor the seller of the Darjeeling tea, there is no substantive evidence which conclusively proofs that the defendant intended to pass off the name Darjeeling to its consumers of various products by the defendant in the use of a lounge, showing no intention to deceive customers of the products to be sold from the origin or have any connection to the place with respect to the name of the place, and is hence not conclusive proof of passing off by the defendants. [8]

CONCLUSION:

The certification trademark obtained by the plaintiff was an attempt at preventing the misuse of the geographical indication “Darjeeling” and the misrepresentation of products to be from Darjeeling, especially the infamous Darjeeling tea. This although came at nought, as a multinational company such as ITC limited decided to name one of their high-end lounges after the GI, making it difficult for the Tea board, India. This use of the name by the defendants was opposed by the plaintiffs, but the grounds of application of the certification trademark obtained by the plaintiff did not extend up to the cause of action, hence making the suit unmaintainable in the court of law. This case however, drew a clear demarcation on the different types and uses of a certification trademark. Where it can be either of goods or services, and in this case, be it goods or services, neither will apply to the defendant, since their use of the name was similar to any other organisation which uses the name Darjeeling, with no intention to falsely advertise any product, or to deceive customers into believing that the products are of Darjeeling origin, hence making the suit unmaintainable on the grounds mentioned in the suit. The suit was henceforth dismissed on the same grounds by the High Court of Calcutta. Hence, this proves that GI trademark of a name cannot in itself prevent the use of the name by anyone, unless it is intended to misrepresent people.

REFERENCE(S):

1. Tea Board, India v. ITC Ltd., 2011 SCC OnLine Cal 1083 : (2011) 115 CWN 825, (BEFORE SANJIB BANERJEE, J.) (India)
2. Tea Board, India v. ITC Ltd., 2011 SCC OnLine Cal 2834 : (2011) 5 CHN 1 (DB) : (2011) 48 PTC 169 (DB) : (2011) 115 CWN 897, (BEFORE BHASKAR BHATTACHARYA AND SAMBUDDHA CHAKRABARTI, JJ.) (India)
3. Tea Board, India v. ITC Ltd.,2019 SCC OnLine Cal 9122 : (2019) 79 PTC 1 : (2019) 1 Cal LT 538, (BEFORE SAHIDULLAH MUNSHI, J.) (India)
4. Sulok S.K, Tea Board, India V. ITC Ltd (2019), EBC Publishing Pvt. Ltd., NLUO SLJ (2020) 162
5. Tarun Khurana, Tea Board, India v. ITC Ltd., Khurana & Khurana, K&K, S. No. 250 of 2010, Mar 20, 2020.
6. Tea Board v. ITC Limited, Special Leave Petition (Civil) No. S3.2282 OF 2011
7. Ashna Chhabra, A Closer Look at Tea Board, India V. ITC Limited Dispute, IIPRD, April 12, 2019.
8. Pankhuri Agarwal, Certification Trade Marks and GI versus ‘Regular’ Trade Marks: The Calcutta High Court Ruling in Tea Board v. ITC, SpicyIP, Feb 20, 2019.

[1] Tea Board, India v. ITC Ltd., 2011 SCC OnLine Cal 1083 : (2011) 115 CWN 825, P. 2-6

[2] Ashna Chhabra, A Closer Look at Tea Board, India V. ITC Limited Dispute, IIPRD, April 12, 2019.

[3] Tea Board, India v. ITC Ltd., 2011 SCC OnLine Cal 2834: (2011) 5 CHN 1 (DB): (2011) 48 PTC 169 (DB): (2011) 115 CWN 897, P. 1-8

[4] Tea Board, India v. ITC Ltd.,2019 SCC OnLine Cal 9122 : (2019) 79 PTC 1 : (2019) 1 Cal LT 538, (BEFORE SAHIDULLAH MUNSHI, J.) (India), P. 1-20

[5] Pankhuri Agarwal, Certification Trade Marks and GI versus ‘Regular’ Trade Marks: The Calcutta High Court Ruling in Tea Board v. ITC, SpicyIP, Feb 20, 2019.

[6] Tea Board v. ITC Limited, Special Leave Petition (Civil) No. S3.2282 OF 2011, P. 1-5

[7] Sulok S.K, Tea Board, India V. ITC Ltd (2019), EBC Publishing Pvt. Ltd., NLUO SLJ (2020) 162, P. 3-7

[8] Tarun Khurana, Tea Board, India v. ITC Ltd., Khurana & Khurana, K&K, C.S. No. 250 of 2010, Mar 20, 2020.