M/s. Bengal Waterproof Limited v. M/s. Bombay Waterproof Manufacturing Company and Anr.

M/s. Bengal Waterproof Limited

v.

M/s. Bombay Waterproof Manufacturing Company and Anr.

1997 (17) PTC 98 (SC)

Question: whether the suit filed by the Appellant (Plaintiff) against the Respondents (Defendants) in the Court of Chief Judge, City Civil Court, Hyderabad being Original Suit No. 123 of 1982 was barred by the provisions of Order 2 Rule 2 Sub-rule (3) of the Code of Civil Procedure, 1908.

Facts:

Plaintiff was proprietor of the trade mark ‘DUCK BACK’ and Plaintiff had acquired reputation for waterproof goods and rubberised waterproof raincoats. Somewhere in 1980, Plaintiff came to know that Defendants were manufacturing and marketing similar products under the trade mark ‘DACK BACK’.

First Suit

• The Plaintiff therefore sued the Defendants in the City Civil Court, Hyderabad only for infringement of trade mark.

• The learned Trial Judge dismissed the same holding there was no infringement of Plaintiff’s trade mark.

Second Suit

• Thereafter in 1982, Plaintiff found that the Defendants were carrying on the infringement of Plaintiff’s registered trade mark and were passing off their goods as goods of the plaintiff

• Plaintiff filed another suit. It was averred in the plaint that the cause of action arose on or about 6th April 1982 and continues to arise within the jurisdiction of the Trial Court.

• Defendants set up the defence of res judicata and that the Defendants had not infringed the Plaintiff’s trade mark and in any case the suit was barred by by Order 2 Rule 2 Sub-rule (3), of the Code of Civil Procedure, 1908.

• The second suit was dismissed on the ground that it was barred by Order 2 Rule 2 Sub-rule (3) of the Code of Civil Procedure, 1908.

High Court of Andhra Pradesh

High Court agreed with the Plaintiff on merits. However, held that the second suit is barred by Order 2 Rule 2 Sub-rule (3), Code of Civil Procedure, 1908 and, therefore, the decree of the Trial Court dismissing the second suit deserved to be confirmed. High Court also took the view that the second suit was not barred by res judicata.

Plaintiff filed an SLP before the Supreme Court

Supreme Court’s Observations:

Supreme Court interpreted Order 2 Rule 2 (3) of the Code of Civil Procedure, 1908 in the present case. The said rule reads as follows:

“2. Suit to include the whole claim. (1) Every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action : but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any Court.

(2) Relinquishment of part of claim-whether a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim, he shall not afterwards sue in respect of the portion so omitted or relinquished.

(3) Omission to sue for one of several reliefs. A person entitled to more than one relief in respect of the same cause of action may sue for all or any of such reliefs : but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards sue for any relief so omitted.

Explanation – For the purposes of this rule an obligation and a collateral security for its performance and successive claims arising under the same obligation shall be deemed respectively to constitute but one cause of action.”

• Once the Plaintiff comes to a court basing his case on an existing cause of action he must include in his suit the whole claim pertaining to that cause of action. If he gives up a part of the claim based on the said cause of action or omits to sue in connection with the same then he cannot subsequently resurrect the said claim based on the same cause of action.

• It must be shown by the Defendant that the second suit is based on the same cause of action on which the earlier suit was based and if in the earlier suit Plaintiff had not sued for any of the reliefs available to it on the basis of that cause of action, the reliefs which it had failed to press in that suit cannot be subsequently prayed for except with the leave of the Court.

• In the present case it is obvious that when earlier suit was filed the Plaintiff had a cause of action regarding illegal use of his trade mark ‘DUCK BACK’ by the Defendants and had also a grievance regarding the then existing deceitful action of the Defendants in trying to pass off its goods ‘DACK BACK’. Therefore, the cause of action for the first suit was based on the infringement of Plaintiff’s trade mark and passing off till the date of the suit filed in 1980.

• Second suit is concerned with entirely a different grievance of the Plaintiff. In the second suit, the grievance is not based on any acts committed by the Defendants in 1980 but Plaintiff’s grievance is regarding the continuous acts of infringement of its trade mark and the continuous passing off action on the part of the Defendants subsequent to the filing of the earlier suit and which had continued on the date of the second suit of 1982.

• The averments in the plaint clearly show that the second suit is not based on the same cause of action on which the earlier suit was based. The cause of action for filing the second suit is the continuous and recurring infringement of Plaintiff’s trade mark by the Defendants continuously till the filing of the present second suit.

• It is obvious that such infringement of a registered trade mark carried on from time to time would give a recurring cause of action to the holder of the trade mark to make a grievance about the same and similarly such impugned actions also would give a recurring cause of action to the Plaintiff to make a grievance about the same and to seek appropriate relief from the court.

• Wherever and whenever fresh deceitful act is committed the person deceived would naturally have a fresh cause of action in his favour. It is difficult to agree how in such a case when in historical past earlier suit was disposed of as technically not maintainable in absence of proper reliefs, for all times to come in future defendant of such a suit should be armed with a licence to go on committing fresh acts of infringement and passing off with impunity without being subjected to any legal action against such future acts.

• In cases of continuous causes of action or recurring causes of action bar of Order 2 Rule 2 Sub-rule (3) cannot be invoked.

• In this connection it is profitable to have a look at Section 22 of the Limitation Act, 1963. It lays down that ‘in the case of a continuing breach of contract or in the case of a continuing tort, a fresh period of limitation begins to run at every moment of the time during which the branch or the tort, as the case may be, continues.

• As act of passing off is an act of deceit and tort every time when such tortious act or deceit is committed by the Defendant the Plaintiff gets a fresh cause of action to come to the court by appropriate proceedings. Similarly infringement of a registered trade mark would also be a continuing wrong so long as infringement continues. Therefore, whether the earlier infringement has continued or a new infringement has taken place cause of action for filing a fresh suit would obviously arise in favour of the Plaintiff who is aggrieved by such fresh infringements of trade mark or fresh passing off actions alleged against the Defendant.

Held:

The learned Trial Judge as well as the High Court were obviously in error in taking the view that the second suit of the Plaintiff in the present case was barred by Order 2 Rule 2 Sub-rule (3) of the Code of Civil Procedure, 1908.