The Supreme Court, recently, dismissed an appeal by Brihan Karan Sugar Syndicate Pvt Ltd (“Appellant”) against the Bombay High Court’s order to stay the execution of a decree passed by the Trail Court. In doing so, the Supreme Court ruled that in a suit for passing off action, Appellant must prove they acquired a reputation or goodwill related to the goods. If no goodwill or reputation is established, no further examination is needed to determine the Appellant’s right in the action.
The Appellant, a country liquor seller, has copyright over the “Tango Punch” label and artistic work. The Appellant had, based on deceptive similarity between the rival labels and the Appellant’s prior rights, obtained a permanent injunction against Yashwantrao Mohite Krushna Sahakari Sakhar Karkhana (“Respondent”), restraining the Respondent from reproducing the label or any part of it in any material form. The Respondent appealed, and the Bombay High Court stayed the decree until the final disposal of the appeal.
The Appellant appealed against the Bombay High Court's order, arguing that the court should not have stayed the execution of a decree passed based on evidence and a complete trial. The Respondent argued that the Appellant had not provided evidence to prove its sales, turnover, or advertisement expenses, and that a Chartered Accountant certificate was not sufficient to establish goodwill and reputation. The Respondent also argued that the Appellant had objected to the Respondent’s application seeking approval for its labels from the Excise Commissioners. However, the Appellant later withdrew its objection, and accordingly, the withdrawal of objection and delay in filing the suit is an act of active acquiescence which was sufficient for the High Court to grant a stay on the execution of the decree.
The Supreme Court, agreeing with the Respondent’s submissions, stated that sales and expenditure on advertising and promotion of a product from a Chartered Accountant may be sufficient for temporary injunction. However, at the time of final hearing, these figures must be proven to establish goodwill and reputation, which the Appellant has done. This was, in the Supreme Court’s opinion, the primary reason for the High Court’s stay on the execution of the decree.
On the issue of acquiescence as a defence to copyright infringement, the Supreme Court ruled that, the Appellant’s withdrawal objection to the Respondent’s application seeking approval of the Excise Commissioner for the Respondent’s label and delay in filing the suit, was an act of active acquiescence, which is a complete defence against action of copyright infringement.
The appeal was, accordingly, dismissed.
Brihan Karan Sugar Syndicate Private Limited versus Yashwantrao Mohite Krushna Sahakari Sakhar Karkhana. CIVIL APPEAL NO. 2768 OF 2023
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