IPR CASE

STUDY
LAXMIKANT V.PATEL
Vs.
CHETANBHAT SHAH
& ANR.
GROUP 4
CASE SUMMARY
Plaintiff started his color lab and studio business in the year 1982 in Ahmedabad by
the name of MJ.
He later changed the name to QSS- Muktajivan Color Lab in 1995.
He was using this name openly, extensively and to the knowledge of everyone
concerned.
To develop his business, the plaintiff promoted his wife to open a new color lab in
the name & style of Muktajivan Color Studio at two other localities of Ahmedabad.
Chetanbhat Shah, who is running a similar business as Gokul Studio, intends to
commence business through his wife, by adopting the name & style of Muktajivan
Colour Lab and Studio
Plaintiff seeked permanent preventive injunction against the defendants by filing the
passing off suit in District Court in 1997.
Application seeking an Ad-Interim injunction was also filed.
The defendants submitted that though the business was started by the name of
Gokul Studio, they had changed it to Muktajivan Colour Lab & Studio before the
filing of the suit.
The defendants again argued that the two localities were away from each other.

ISSUE
The issue at hand is to determine whether the plaintiffs application seeking an Ad-Interim
injunction against the use of the trade name Muktajivan by the defendants should be
granted or not.

RULES
An action for passing-off will lie wherever the defendant companys name, or its
intended name, is calculated to deceive, and so to divert business from the plaintiff,
or to occasion confusion between the two businesses.
Where there is probability of confusion in business, an injunction will be granted
even though the defendants adopted the name innocently.
With the lapse of time such business or services associated with a person acquire a
reputation or goodwill which becomes a property which is protected by courts.
The 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 he goods or services belonging to
someone else are his or are associated therewith. It does not matter whether the
latter person does so fraudulently or otherwise.
The three elements of passing off action are the reputation of goods, possibility of
deception and likelihood of damages to the plaintiff. In our opinion, the same
principle, which applies to trade mark, is applicable to trade name.
Plaintiff does not have to prove actual damage in order to succeed in an action for
passing off. Likelihood of damage is sufficient.
Once a case of passing off is made out the practice is generally to grant a prompt ex-
parte injunction followed by appointment of local Commissioner, if necessary.

ARGUMENTS BY DISTRICT COURT
Appellant carries his business in the trade name Muktajivan Colour Lab at least
since 1995.
Respondents had recently adopted the word Muktajivan in his business name had
so done on or about the date of the institution of the suit.
Respondents studios name was somewhat identical with the trade name of the
Appellant.
Decision
Injunction was refused on the ground that the business of the Respondents was in
the other part of the city of Ahmedabad, at a distance of about 4 to 5 km.

ARGUMENTS BY HIGH COURT
Respondents business had already come into existence on the date of the institution
of the suit and therefore they could not be restrained by issuance of injunction.
No pleadings suggested that the other two businesses using Muktajivan as part of
their trade names were so using the name under the authority and licence of the
Appellant. Therefore Appellant was not entitled to grant of an injunction restraining
only the Respondents.
Decision
The appeal was dismissed by High Court. Plaintiff filed an appeal before the Supreme
Court of India. Supreme Court ruled on the basis of finding arrived at by the Trial
Court that Plaintiff has been doing his business under the impugned name at least
since 1995.
ARGUMENTS BY SUPREME COURT
The Supreme Court did not find the discretion exercised by the Trial Court and the
High Court to be reasonable or judicious.
The case falls within well accepted exceptions because the grant of interlocutory
injunction to the plaintiff should not have been refused.

Decision
An ad-interim injunction was issued in favour of the plaintiff restraining the
defendants from using directly or indirectly the word Muktajivan in their trade name
associated with the business
The plaintiff was declared to be entitled to costs throughout incurred up to that
stage
The court made it clear that the order was being passed at an interlocutory stage
and thus, any observation made by the Supreme Court would not come in the way of
decision making by the lower courts.

CONCLUSION
Based on the above arguments and the rules of passing off, we believe that the plaintiffs
application seeking an Ad-Interim injunction against the use of the trade name Muktajivan
by the defendants should have been granted.