$~ IN THE HIGH COURT OF DELHI AT NEW DELHI CS · PDF filelaunched cream biscuits under Sunfeast Dark Fantasy. It is further stated that thereafter ITC launched branded snacks, juices

IA No. 10139/2016 in CS (Comm) 1128/2016 Page 1 of 28

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* IN THE HIGH COURT OF DELHI AT NEW DELHI

+ CS (COMM) 1128/2016

Reserved on: 1st September 2016

Date of decision: 6th September, 2016

ITC LTD ..... Plaintiff

Through: Mr. Rajiv Nayar, Mr. Sandeep Sethi

and Ms. Pratibha M. Singh, Senior Advocates

with Mr. Sudeep Chatterjee, Ms. Jaya Mandelia

and Ms. Nupur Lamba.

Versus

BRITANNIA INDUSTRIES LTD ..... Respondent

Through: Mr. Sudhir Chandra, Senior

Advocate with Ms. Ishani Chandra, Mr. Sagar

Chandra, Mr. Ankit Rastogi, and Mr. B. Mishra,

Advocates.

CORAM: JUSTICE S.MURALIDHAR

O R D E R

% 06.09.2016

IA No.10139/2016

1. The Plaintiff, ITC Limited („ITC‟), has filed the accompanying suit

against the Defendant, Britannia Industries Limited („Britannia‟), for

permanent injunction seeking to restrain Britannia from violating its

rights in the Plaintiff‟s packaging/trade dress of „Sunfeast Farmlite

Digestive - All Good‟ biscuit by using a deceptively and confusingly

similar trade dress for its Nutri Choice Digestive Zero biscuit. The relief

claimed in the suit is also for an injunction to restrain Britannia from (a)

passing off ITC‟s rights in the trade dress/ packaging/ label, (b) diluting

the mark, (c) infringing ITC's copyright in the said packaging and for

delivery up, damages and rendition of accounts etc. By this application


under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure 1908

(CPC), ITC seeks an interim injunction to restrain Britannia from

continuing to use the impugned packaging for its Nutri Choice Digestive

Zero biscuit.

2. The packaging of ITC‟s „Sunfeast Farmlite Digestive – All Good‟

biscuit which was launched in February 2016 is as under:

3. In July 2016, Britannia launched in the market its Nutri Choice

Digestive Zero biscuit, the packaging of which is as under:


4. According to ITC, Britannia‟s impugned packaging for its Nutri

Choice Digestive Zero Biscuit is an imitation of ITC‟s packaging for

Sunfeast Farmlite Digestive – All Good. When placed next to each

other, they are indistinguishable to the unwary customer.


5. The photographs depicting the manner of the products being

displayed in the market place/stores when placed next to each other have

been placed on record. It is pointed out that Britannia has been

marketing and selling digestive biscuits under the mark „Nutri Choice‟

for the last several years. According to ITC, after the launch of its

„Sunfeast Farmlite Digestive – All Good' biscuit with „No Added Sugar‟

and „No Maida‟, Britannia filed a complaint before the Advertising

Standards Council of India („ASCI‟). After failing attempt to the said

complaint, Britannia, in July 2016, introduced Nutri Choice Digestive

Zero biscuit claiming „0% Added Sugar‟ and „0% Maida‟ in packaging

which is nearly identical and/or deceptively similar to that of ITC‟s

packaging.

6. At the first hearing of 22nd

August, 2016, Mr. Sudhir Chandra, learned

Senior counsel, instructed by Ms. Ishani Chandra and Mr. Sagar

Chandra, Advocates appeared. Summons in the suit and notice in this

application were accepted on that date itself. After the case was heard

for some on that date, Mr. Chandra stated that he needed some time to

take instructions on the suggestions made for possible variation in the

impugned packaging. Therefore, no interim order was passed and the

case was adjourned to 24th August, 2016 on which date both parties

agreed, without prejudice to their respective rights, to sit down and

explore the possibility of settling the dispute pertaining to the wrapper in

respect of the Nutri Choice Digestive Zero biscuits of Britannia. The

case was then listed for 31st August, 2016.

7. An offer was made by Britannia that they would substitute the blue

colour in the impugned packaging with dark or navy blue. This was not

acceptable to ITC. It was pointed out that Britannia has been using a


different packaging for the same version of its Nutri Choice Digestive

zero sold internationally. The Court was shown the said packaging

which is as under:

8. It was stated on behalf of ITC that as long as Britannia adopts the

above packaging for its Digestive Zero biscuits in India, it would have

no objection. Alternatively, it was suggested that if the blue colour in the

impugned packaging is substituted by any other colour (other than a

different shade of blue), ITC would have no objection.

9. On the side of Britannia, it is stated that yellow colour of Britannia‟s

packaging was an essential and prominent feature and formed part of a

colour scheme that identified a range of Britannia's digestive biscuits.

Mr. Chandra pointed out that there were three variants in Britannia's

digestive biscuit segment. Two of the variants i.e., Nutri Choice

Digestive Hi-Fibre biscuits and Nutri Choice Digestive 5 Grain biscuits

were introduced in October 2014 and the third variant was the Nutri

Choice Digestive Zero biscuit. The packaging of the three variants are:


10. It was submitted that the blue colour has been used by Britannia for

a wide variety of its biscuits. Moreover, the colour blue is supposed to

reflect the 'World Diabetes Day'. Britannia has been using the colour

blue on its other range of zero per cent added sugar Nutri choice

Essentials Oat and Ragi cookies at least since November 2010. The

current packaging of the said biscuits retaining the colour blue was


launched in November 2014. Apart from Britannia‟s own Nutri Choice

Nice Bite Biscuit, a reference is made to the packaging of Britannia

Coconut Crunchees, Nice Time, Marie Gold, which has been marketing

its products to show that the combination of yellow and blue packaging

finds place in all these biscuits.

11. Britannia pointed out that ITC had earlier adopted for the Sunfeast

Farmlite Digestive All Good Biscuits a packaging which was a

combination of lemon green and blue. Therefore, if ITC was prepared to

give up the yellow colour, Britannia would replace the blue colour on its

packaging for some other colour.

12. Since there was no meeting ground between the parties as far as the

above suggestions were concerned, the Court on 2nd September, 2016,

proceeded with the matter on merits.

Submissions on behalf of ITC

13. Appearing for ITC, Mr. Rajiv Nayar, Mr. Sandeep Sethi and Ms.

Pratibha M. Singh, learned Senior counsel submitted that ITC‟s

packaging „Sunfeast Farmlite Digestive – All Good‟ had certain unique

distinctive features, as under:

(a) The brand name Sunfeast is written on the top-left hand side of

the label on the yellow coloured portion with the trade mark

„Farmlite‟ below it and the mark „Digestive – All Good‟ appearing

below „Farmlite‟.

(b) The colour scheme used in the trade dress is Yellow and Blue.

The left part of the packaging is in a yellow background and the

right side of the packaging is in blue and both colours are separated


by a curved line.

(c) The picture of the biscuits appears on the right front side of the

label which is depicted with a wheat spike/sheaf of wheat with

grains lying at the bottom of an individual wheat biscuit with the

words “No Added Sugar/Maida” written on the biscuit in a bold

white font. The words Sugar and Maida are separated by a white

horizontal dividing line between the two words.

14. It is further submitted that ITC, which is a major private sector

company, is engaged in manufacturing and marketing of its diverse

categories of products. It had a turnover as of 2015-16 of Rs. 51,582

crores. Its branded packaged foods business is one of the fastest growing

foods businesses in India. It is stated that it entered the biscuits segment

in the year 2003 with the launch of Sunfeast and in the year 2005, ITC

launched cream biscuits under Sunfeast Dark Fantasy. It is further stated

that thereafter ITC launched branded snacks, juices etc. and products in

the dairy and that its foods business has grown to a significant size. It is

pointed out that ITC has made sales of its „Sunfeast Farmlite Digestive –

All Good‟ since its launch in February 2016 until July 2016 to the extent

of over Rs. 5 crores and has invested over Rs. 14 crores towards

marketing expenditure with respect to „Sunfeast Farmlite Digestive All

Good‟. The copy of the certificates issued by the Chartered Accountant

to the above fact has been placed on record.

15. The case of ITC is that Britannia was aware of ITC's packaging

since February 2016 and chose not to enter the market till July 2016

with its competing product. It is pointed out that Britannia made no

grievance in the first place about ITC's packaging since it first went with


a complaint against ITC about this very product (and not its packaging)

before the Advertising Standards Council of India (ASCI) and it was

only after it was unsuccessful there it decided to launch the Nutri Choice

Digestive Zero biscuit by imitating ITC's packaging for the Sunfeast

Farmlite Digestive All Good biscuit. It is further pointed out that

Britannia‟s „Nutri Choice Digestive Zero biscuit‟ has, in the packaging

in small font, stated that “this biscuit contains sucralose not

recommended for children”. This would tarnish the image of ITC

inasmuch of ITC products, including „Sunfeast Farmlite Digestive – All

Good‟ biscuits as they are suitable for consumption including children

and an unwary consumer is like to pick the Britannia‟s product thinking

the same to the ITC‟s product. This would also dilute ITC's brand and

harm its reputation since ITC's biscuit in fact has no added sugar or

maida and is suitable for children and adults alike.

16. The central thrust of ITC's submissions is that Britannia has copied

the unique colour scheme and combination, and the method and

placement of the various elements of ITC‟s trade dress. The products are

identical. The trade channels are identical. Thus, this is a case of triple

identity and it is bound to lead to confusion and deception. It is

submitted that Britannia being a subsequent adopter of the packaging,

was aware of ITC‟s products, including Sunfeast Farmlite Digestive –

All Good, and has copied the packaging, get up, lay out, colour scheme,

concept, overall appearance etc. in order to pass off their „Nutri Choice‟

Digestive biscuit products as another product of ITC itself. It is stated

that even the pricing of the competing products is identical. Each pack

is priced at a maximum retail price („MRP‟) of Rs. 25. It is further stated

that there is bound to be confusion at the retailer level as well as at the


level of the purchaser. Packaging is said to play an important role in this

category of food products and the consumer is bound to be confused

between the two competing packets of biscuits.

17. In the plaint, it is averred that there is also a copyright infringement

by Britannia. It is stated that a mere glance at the impugned packaging

would show that Britannia could not have designed it without having

ITC‟s impugned product packaging/label of Sunfeast Farmlite Digestive

– All Good in mind. It is stated that the use by Britannia of a deceptively

similar packaging for an identical product constitutes infringement of

the original artistic work in the unique product packaging/label of ITC

under Section 51 of the Copyright Act, 1957. It is stated that the illegal

act of Britannia constitutes misrepresentation and unfair competition and

is likely to dilute the distinct character of ITC‟s brand. However, it

requires to be noticed that during the hearing, the aspect of copyright

infringement was not touched upon by counsel for ITC.

Submissions on behalf of Britannia

18. Mr. Sudhir Chandra for Britannia began by pointing out that

Britannia is the market leader and had over 66% of the market share (in

both volume and value) whereas ITC had only 1.8%. He pointed out that

Britannia has been manufacturing and marketing the above range of

Nutri choice Digestive biscuits with the primary/predominant colour of

the product packaging below yellow along with a secondary colour to

indicate the variant since 2008.

19. Mr. Chandra debunked ITC's submission that only after Britannia‟s

complaint before ASCI was dismissed, it decided to introduce Nutri

Choice Digestive Zero biscuits. It is pointed out that the complaint was


rejected by ASCI by its order dated 12th July, 2016 whereas the date of

manufacture of the Nutri Choice Digestive Zero biscuit as shown in the

packaging placed on record by ITC itself is 30th June, 2016. It is pointed

out that Britannia's nutri choice biscuits have been in the market since

2008. However, it was not disputed by Mr. Chandra that this particular

variant viz., Nutri Choice Digestive Zero biscuit was introduced only in

July 2016.

20. Referring to the decision in Kaviraj Pandit Durga Dutt Sharma v.

Navaratna Pharmaceutical Laboratories PTC (Suppl) (2) 680 (SC),

Mr. Chandra submitted that there was a distinction to be drawn between

the action and infringement of action for passing off. In an action for

passing off, it had to be demonstrated that the added matter in the

defendant's mark was insufficient to distinguish its goods from that of

the Plaintiff. Mr. Chandra enlisted what he considered to be the

distinctive features of the impugned packaging. First, the word

„Britannia' itself appeared prominently against a red background in one

corner of the impugned packaging. Secondly, the word „Nutri Choice‟

featured prominently and this was not present in ITC's packaging.

Further, the shades of blue and yellow were different. Lastly, the entire

get up was itself distinct. Mr. Chandra stated that while there might be a

similarity in the two packagings, when viewed as a whole there was no

case made out for passing off.

21. Mr. Chandra referred to the decision in Reckitt & Colman Products

Limited v. Borden Inc. (1990) 1 All ER 873 and emphasized that of the

three essential elements which had to be established by the Plaintiff in

an action for passing off, ITC here had failed to show that it had a

formidable goodwill or reputation in the particular brand i.e., Sunfeast


Farmlite Digestive All Good biscuit relatable to its packaging. Having

launched the said product in February 2016, ITC cannot possibly claim

that it had built a reputation in that particular biscuit already by July

2016. Reputation, according to Mr. Chandra, had to be built over several

years and not in a few months. He also referred to the passage from

Kerly‟s Law of Trade Marks and Trade Names.

22. On the aspect of deception and confusion, Mr. Chandra referred to

the decision of the U.S. Supreme Court in Wal Mart Stores Inc. v.

Samara Brothers Inc. 54 USPQ2d 1065 to urge that colour per se was

not an element of distinctiveness for identifying the source of the

products. Referring to the decision in Laxmikant v. Patel v. Chetanbhat

Shah 2002 (24) PTC 1 (SC) which in turn referred to the decision in

Oertli v. Bowman (1957) RPC 388, he submitted that ITC failed to

show that the get up or trade dress was distinctive of its goods and had

acquired a 'secondary meaning' deserving of protection in an action for

passing off. He referred to extracts from the 'Law of Passing Off: Unfair

Competition by Misrepresentation' by Christopher Wadlow. Mr.

Chandra submitted that in the advertisements for its product, ITC was

actually projecting its trademarks i.e. ITC, Sunfeast and Farmlite. It was

not selling the product on the basis of its packaging. He submitted that

ITC should be prepared to fight Britannia in the market place by a

superior quality product and not resort to litigation. He maintained that it

was ITC that was coming closer to Britannia by adopting the yellow

colour as a prominent feature of its packaging rather than the other way

around. There was no need for Britannia, being the market leader, to

adopt anyone else's packaging.


Rejoinder submissions of ITC

23. Replying to the above arguments, Mr. Rajiv Nayar, learned senior

counsel for ITC, first pointed out that the lemon green that was

contemplated by ITC as a possible colour on the packaging for Farmlite

Digestive All Good biscuits was, in fact, only used at the planning stage.

The product was never launched with that colour combination in the

packaging. He pointed out that ITC was in the market with Farmlite

Digestive All Good biscuits since February 2016 whereas Britannia

entered with Nutri Choice Digestive Zero only in July 2016. Relying on

the decision in Ishi Khosla v. Anil Aggarwal 2007 III AD (Del) 421,

Mr. Nayar pointed out that reputation could be built, not necessarily

over a large number of years, but even „overnight‟. The fact that since its

launch in February 2016, ITC has been able to sell Rs. 5 crores worth of

Farmlite Digestive All Good biscuits reflected its growing reputation.

Further, the fact that Britannia chose to file a complaint to the ASCI and

then in July 2016 introduced its own variant imitating ITC‟s packaging

also showed that ITC was posing a good competition with the growing

popularity of its product. He submitted that if indeed Britannia had a

66% market share, it should really not be worried about a competitor

who had less than 3% market share. By trying to stymie healthy

competition by imitating the packaging, Britannia was indulging in

unfair trade practice.

24. Adverting to the aspect of confusion in deception, Mr. Nayar referred

to the decision of the learned Single Judge in Baker Hughes Limited v.

Hiroo Khushalani ILR (1999) I Delhi Page 41, where the Court

elaborated on the concept of 'initial interest' in a product. If the initial

interest is based on confusion and deception, it can give rise to a cause of


action for a tort of passing off. He pointed out that although the decision

of the learned Single Judge was reversed by the Division Bench, the

Supreme Court, ultimately affirmed the Single Judge in Baker Hughes

Limited v. Hiroo Khushalani (2004) 12 SCC 628. Referring to the

decision in Ruston & Hornsby Ltd. v. The Zamindara Engineering Co.

(1970) 2 SCR 224, he submitted that in an action of passing off, the

question required to be addressed was “whether the defendant was selling

goods so marked as to be designed or calculated to lead purchasers to

believe that they are the plaintiff‟s goods?” He also referred to the

decision of the Bombay High Court in Gorbatschow Wodka KG v. John

Distilleries Limited 2011 (47) PTC 100 to urge that merely because the

purchaser may be educated and have greater discerning capacity, the

likelihood of deception is not minimised. He also referred to the decision

in Parle Products (P) Ltd v. J. P. & Co. Mysore (1972) 1 SCC 618.

The aspect of reputation

25. The Court proposes to begin the discussion by recapitulating the

difference between an action for infringement and that for passing off.

The decision of the Supreme Court in Kaviraj Pandit Durga Dutt

Sharma v. Navaratna Pharmaceutical Laboratories (supra) is

considered a classic in this context. The relevant extract of the said

decision, which has been reiterated in many subsequent judgments reads

as under:

“The use by the defendant of the trade mark of the plaintiff is not

essential in an action for passing off, but is the sine qua non in the

case of an action for infringement. No doubt, where the evidence in

respect of passing off consists merely of the colourable use of a

registered trade mark, the essential features of both the actions

might coincide in the sense that what would be a colourable


imitation of a trade mark in a passing off action would also be such

in an action for infringement of the same trade mark. But there the

correspondence between the two ceases. In an action for

infringement, the plaintiff must, no doubt, make out that the use of

the defendant's mark is likely to deceive, but where the similarity

between the plaintiff's and the defendants mark is so close either

visually, phonetically or otherwise and the court reaches the

conclusion that there is an imitation, no further evidence is required

to establish that the plaintiff's rights are violated. Expressed in

another way, if the essential features of the trade mark of the

plaintiff have been adopted by the defendant, the fact that the get-

up, packing and other writing or marks on the goods or on the

packets in which he offers his goods for sale show marked

differences, or indicate clearly a trade origin different from that of

the registered proprietor of the mark would be immaterial; whereas

in the case of passing off, the defendant may escape liability if he

can show that the added matter is sufficient to distinguish his goods

from those of the plaintiff. ”

26. It is this very distinction that has been reiterated subsequently by the

Supreme Court in Ruston & Hornsby Ltd. v. The Zamindara

Engineering Co. (supra) where it observed as under:

“In an action for infringement where the defendant's trade

mark is identical with the plaintiff's mark, the Court will not

enquire whether the infringement is such as is likely to deceive

or cause confusion. But where the alleged infringement

consists of using not the exact mark on the Register, but

something similar to it, the test of infringement is the same as

in an action for passing off. In other words, the test as to

likelihood of confusion or deception arising from similarity of

marks is the same both in infringement and passing off

actions.”

27. The question that had to be asked as far as passing off action,

according to the Supreme Court was:


“Is the defendant selling goods so marked as to be designed or

calculated to lead purchasers to believe that they are the

plaintiff's goods?”

28. The present case is focused on trade dress and getup in the packaging

of the competing products which are identical products inasmuch as both

are digestive biscuits and are sold in the same trade channels and are at

the same retail price. What is the extent to which, in the passing of

action, the trade dress and getup can have an impact was examined by the

House of Lords in Reckitt & Colman Products Ltd. v. Borden Inc.

(supra).

28.1 The facts of the case were that the appellants, a company in the

USA, and its Belgium subsidiary began marketing lemon juice in

conventional bottles in 1975 and by the end of 1980 their sales were at

25% of the total sales of lemon juice in the United Kingdom (UK). The

Respondents, on the other hand, marketed lemon juice in convenient

plastic squeeze packs from 1956 onwards. With the growing sales of the

Appellants, the Respondents launched sales of their products in

conventional bottles. The Appellants then responded by selling their juice

in plastic lemon shaped squeeze containers. The case brought forth by the

Respondent was that the Appellants were passing off their lemon juice as

that of the Respondents by using a getup deceptively similar to the one

used by the Appellants. The Court of the first instance granted an

injunction in favour of the Respondents which was upheld by the Court

of Appeal.

28.2 The House of Lords dismissed the further appeal by holding that the

plastic lemon container was not an object in itself but was part of the get-

up under which the Respondents‟ product was sold. Although the


protected get-up consisted of both the container and the label, there was

no reason why a part of the get-up viz. the container could not be

separated from the subject matter of protection in its own right. Once it

was established that what the Appellants were doing constituted a

misrepresentation which effectively deceived the public into an erroneous

belief regarding the source of the product, it was immaterial whether that

resulted from the similarity of their get-up to the whole of the

Respondents‟ get-up or only to the most striking part of it.

28.3 It was observed:

"the essence of the action for passing off is a deceit practised

on the public and it can be no answer, in a case where it is

demonstrable that the public has been or will be deceived, that

they would not have been so deceived if they had been more

careful, more literate or more perspicacious. Customers have

to be taken as they are found; there is no principle of law that

there must always be assumed to be a literate and careful

customer”.

28.4 Immediately relevant to the case at hand are the three elements that

must be shown to exist for a Plaintiff to succeed in an action for passing

off:

“These are three in number. First, he must establish a goodwill

or reputation attached to the goods or services which he

supplies in the mind of the purchasing public by association

with the identifying "get-up" (whether it consists simply of a

brand name or a trade description, or the individual features of

labelling or packaging) under which his particular goods or

services are offered to the public, such that the get-up is

recognised by the public as distinctive specifically of the

plaintiff's goods or services. Secondly, he must demonstrate a

misrepresentation by the defendant to the public (whether or

not intentional) leading or likely to lead the public to believe

that goods or services offered by him are the goods or services


of the plaintiff. Whether the public is aware of the plaintiff's

identity as the manufacturer or supplier of the goods or

services is immaterial, as long as they are identified with a

particular source which is in fact the plaintiff. For example, if

the public is accustomed to rely upon a particular brand name

in purchasing goods of a particular description, it matters not

at all that there is little or no public awareness of the identity

of the proprietor of the brand name. Thirdly, he must

demonstrate that he suffers or, in a quia timet action, that he is

likely to suffer damage by reason of the erroneous belief

engendered by the defendant's misrepresentation that the

source of the defendant's goods or services is the same as the

source of those offered by the plaintiff.”

29. In a concurring opinion of Lord Jauncey of Tullichettle in the same

decision, it was observed:

“However, it is a prerequisite of any successful passing off

action that the plaintiff's goods have acquired a reputation in

the market and are known by some distinguishing feature. It is

also a prerequisite that the misrepresentation has deceived or

is likely to deceive and that the plaintiff is likely to suffer

damage by such deception. Mere confusion which does not

lead to a sale is not sufficient. Thus, if a customer asks for a

tin of black shoe polish without specifying any brand and is

offered the product of A which he mistakenly believes to be

that of B, he may be confused as to what he has got but he has

not been deceived into getting it. Misrepresentation has played

no part in his purchase.”

30. In Kerly‟s Law of Trade Marks and Trade Names, on the aspect of

the plaintiff having to prove reputation it is said:

“As in any other passing off case, a claimant relying upon get-

up must prove his reputation: he must prove, that is, that the

get-up concerned indicates his goods and no one else‟s. In

particular, he must show that distinctiveness lies in the get-up

and not (for instance) in his name or trademarks, if those


appear on the goods. Thus, if a claimant by his cautions and

advertisements shows that he relies wholly or mainly on his

trade mark or business name, he makes his case on general

get-up, apart from trade mark or business name, more difficult

to establish. A trader who introduces a new feature into the

get-up of his goods does not thereby acquire any proprietary

interest in it, so as to be able to prevent its use by competitors,

until it has become so identified with his goods that its use by

others is calculated to deceive. No case can be made merely by

showing an imitation of the parts of the get-up of goods which

are common to the trade. But very little evidence of user may

be sufficient to establish distinctiveness where the get-up is

not only novel but striking, even though its consists of a

combination of commonly used parts.”

31. On the aspect of reputation, there is merit in ITC's contention that it is

not practicable and in fact not necessary, particularly when a new product

with a distinctive packaging is introduced in the market for the Plaintiff

to show that it has established a formidable reputation in that product for

a number of years. The averment of ITC that the sales of Sunfeast

Farmlite Digestive All Good biscuits has been to the extent of Rs. 5

crores in a period of over five months since it was first introduced in

February, 2016 is a significant factor in examining the reputation of the

product. It has further been averred by ITC that it has incurred over Rs.

14 crores as marketing expenditure. It has placed on record the

certificates of its Chartered Accountant in support of the said averments.

In reply to the said averment, Britannia states that contents thereof are

wrong and ITC should be put to strict proof of the same. Therefore, there

is no specific denial as such.

32. It is not impossible that a consumer product, which is a new biscuit,

can acquire popularity in a short span of time. The trend of sales over say

six months can be indicative of whether the popularity is growing.

While, these would be matters of evidence, it cannot be said that the


reputation attached to a product can develop only if it has been in the

market for a number of years. In the particular segment of consumer

durables and eatables, it is not unknown that a product that caters to a

particular taste or choice of a consumer can become popular in a short

span of time. As observed by this Court in Ishi Khosla v. Anil Aggarwal:

"To acquire secondary meaning/distinctive meaning it is not

necessary that product is in the market for number of years, as

observed earlier. If a new idea is fascinating and appeals to the

consumers, it can become a hit overnight.

33. Health conscious consumers are likely to be discerning on their

choice of food, including biscuits. A high fibre content or a variety of

grains present in the biscuit would make it a likely choice. It is this

category of consumers that is being targeted by the food industry, which

now includes ITC and Britannia. What is of interest here is the clear

announcement on the packaging that there is no Sugar or no Maida. This

was not a prominent element of Britannia's earlier variants of Nutri

choice Digestive Biscuits. It appears that the clear indication on the

packet that there is no sugar or maida obviously has an impact on the

discerning health conscious consumer. The fact that Britannia for some

reason did not think of introducing the Digestive Zero variant till six

months after ITC introduced it is a factor that weighs in favour of ITC. It

is arguable that Britannia woke up a bit late to the potential after realising

that there is a niche market for this variant of zero sugar and zero maida

digestive biscuits.

34. It is in the above background that the question whether this particular

product of ITC has acquired a reputation requires to be addressed. The

question whether the packaging of Sunfeast Farmlite Digestive All Good

biscuits has become identified with the product is a matter for evidence.


However, the fact that sales of the said biscuit had picked up to an extent

of Rs. 5 crores in a short span of over five months should be an indicator

of its growing reputation. Consequently, this Court is satisfied that ITC

has been able to establish prima facie that its product Sunfeast Farmlite

Digestive All Good biscuit has acquired a growing reputation in a short

span which is deserving of protection.

The aspect of deception and confusion

35. Turning next to the aspect of deception, it must be noticed at the

outset that during the course of arguments counsel on both sides who had

brought their respective competing products to the Court were

themselves confused as to which was their client‟s product. At one stage,

Mr. Chandra picked up ITC's product when in fact he meant to show how

Britannia's packaging was distinct and not similar to ITC's packaging.

However, this by itself cannot be determinative of there being deception

and/or confusion as a result of both packets being juxtaposed.

36. Biscuits are normally stacked on shelves in a grocery shop or a

supermarket. Usually there is an entire section where the biscuits of

different manufacturers are arranged side by side. Where the product is

an eatable like a biscuit, the colour and the colour scheme of the

packaging plays an important role in the consumer making an initial

choice and in enabling a discerning consumer to locate the particular

brand of a manufacturer. The aspect of 'initial interest' was explained by

this Court in Baker Hughes Limited v. Hiroo Khushalani as under:

“In some case, however, it is also possible that such a

purchaser after having been misled into an initial interest in a

product manufactured by an imitator discovers his folly, but

this initial interest being based on confusion and deception can


give rise to a cause of action for the tort of passing off as the

purchaser has been made to think that there is some

connection or nexus between the products and business of two

disparate companies.”

37. Therefore, when another competing variant of the biscuit is

introduced six months later and a consumer on the basis of the popularity

of a product that has recently been introduced makes a mistake as to

which packet of biscuit he is picking up, it can be argued that the initial

interest was based on confusion and deception and, therefore, gives rise

to a tort of passing off. In Wal Mart (supra) it was observed that the

product‟s trade dress can be protected only if it is shown that it had

acquired a secondary meaning “since design, like colour, is not inherently

distinctive.” However, the product in that case was a certain kind of

clothing. In that context, it was said that the colour by itself does not

identify the source of the product. However, that may not be entirely true

when it comes to products like biscuits. The packaging of a biscuit does

become associated with the manufacturer or brand. The colour on the

wrapper would certainly play an important part.

38. Similar marks or features used in wrappers of competing biscuits was

the subject matter of Parle Products (P) Ltd. v. J.P. & Co. (supra). The

Appellants there owned certain registered trademarks one of which was

“Glucose” and was used on their half pound biscuit packets. Another

registered trade mark was a wrapper with its colour scheme, general set

up and entire collocation of words. The wrapper was of buff colour and

depicted a farm yard with a girl in the centre carrying a pail of water and

cows and hens around her on the background of a farmyard house and

trees. The Respondent's wrapper contained a picture of a girl supporting

with one hand a bundle of hay on her head and carrying a sickle and a


bundle of food in the other, the cows and hens surrounding her. The trial

court declined the injunction. The High Court looking at the broad

features did not think that they were so similar so as to deceive an

ordinary purchaser. Since it was an action for infringement, the Supreme

Court declined to treat it as a case of passing off. Nevertheless, it

explained that in order to come to a conclusion whether one mark is

deceptively similar to another “the broad and essential features of the two

are to be considered.” It was further explained as under:

“They should not be placed side by side to find out if there are

any differences in the design and if so, whether they are of

such character as to prevent one design from being mistaken

for the other. It would be enough if the impugned mark bears

such an overall similarity to the registered mark as would be

likely to mislead a person usually dealing with one to accept

the other if offered to him. In this case we find that the packets

are practically of the same size, the colour scheme of the two

wrappers is almost the same; the design on both though not

identical bears such a close resemblance that one can easily be

mistaken for the other. The essential features of both are that

there is a girl with one arm raised and carrying something in

the other with a cow or cows near her and hens or chickens in

the foreground. In the background there is a farm house with a

fence. The word "Gluco Biscuits" in one and "Glucose

Biscuits" on the other occupy a prominent place at the top with

a good deal of similarity between the two writings. Anyone in,

our opinion who has a look at one of the packets to-day may

easily mistake the other if shown on another day as being the

same article which he had seen before. If one was not careful

enough to note the peculiar features of the wrapper on the

plaintiffs goods, he might easily mistake the defendants'

wrapper for the plaintiffs if shown to him some time after

he had seen the plaintiffs'. After all, an ordinary purchaser

is not gifted with the powers of observation of a Sherlock

Holmes. We have therefore no doubt that the defendants'

wrapper is deceptively similar to the plaintiffs' which was

registered.” (emphasis supplied)


39. When the above approach is adopted in the present case, several

features as explained in a tabular form as under by the ITC, are visible:

Basis Plaintiff‟s product Defendant‟s product

Packaging

Color

combination

Yellow and Blue Yellow and Blue

Image of biscuits Digestive biscuit with

wheat spike/sheaf of

wheat and grains

Digestive biscuit with

wheat spike/sheaf of

wheat and grains

Placement of

special benefit

No added sugar/maida

mentioned on the

pictorial depiction of the

biscuit on the right side

of the packaging

0% added sugar/maida

mentioned on the pictorial

depiction of the biscuit on

the right side of the

packaging

Manner of

writing of

writing special

benefit

“No” printed in a large

font with “added sugar”

written on the right hand

side on the depiction of

the biscuit with “maida”

written underneath

„added sugar‟ with a

white coloured dividing

line between „ADDED

SUGAR” and

“MAIDA”

“0% printed in a large

font with “Added Sugar”

written on the right hand

side on the depiction of

the biscuit with “Maida”

written under “Added

Sugar” with a white

coloured dividing line

between “Added Sugar”

and “Maida”.

40. The Court would here also like to observe that the very colour scheme


of the wrapper with yellow colour on the left and blue on the right, the

positioning of the letters 'No Sugar' above and 'No Maida' below are

strikingly similar. The words Nutri Choice merges with the background.

As a result what strikes the eye from a distance of say even 10 ft. is the

colour combination of yellow on the left and blue on the right. The Court

is, therefore, satisfied that the impugned packaging for the Nutri Choice

Digestive Zero Biscuits launched by Britannia is deceptively similar to

the packaging of ITC’s Sunfeast Farmlite Digestive All Good biscuits and

such deception is likely to confuse the consumers of such biscuits, even

the discerning health conscious ones, into thinking that Britannia's

biscuits are that of ITC’s.

Likelihood of damage

41. As regards the third element of damage that is likely to be caused to

ITC if Britannia were not injuncted, it is possible that Britannia being a

66% market holder can swing ITC's customers away from ITC's

competing product as a result of the deceptive packaging. The packaging

of Britannia's earlier two variants of digestive biscuits did not contain the

blue colour. They were a combination of yellow and red and yellow and

green. Those variants were introduced in October 2014. ITC was the first

as far as the 'No sugar' and 'no maida' variant is concerned. ITC's product

was launched in February 2016. Britannia was aware of and lived with

the yellow and blue packaging of ITC's Farmlite Digestive All Good

biscuits for about six months. Even if it were to be accepted that yellow

colour is integral to Britannia's packaging scheme for Digestive biscuits,

Britannia's purpose would well be served by adopting a colour, other than

blue, to combine with the yellow colour of its packaging. Further, even if

Britannia insists on having both yellow and blue as part of its packaging,


then ITC's suggestion that Britannia can use for its Indian market the

same wrapper it uses for the same product in the international market

appears reasonable. Britannia's rejection of these suggestions has brought

about a situation where the deception and confusion in the mind of the

average health conscious consumer is likely to persist.

42. The question whether a deception of this kind will affect the

consumer's choice cannot be answered in the abstract. It will depend on

the type of product, the marketing practice peculiar to the industry and

trade, the profile of the targeted consumers and so on. While it is true that

superior quality of ITC's biscuit will ultimately determine its popularity

in the market, if the initial choice that a consumer makes of this particular

brand of biscuits gets altered on account of the possible deception and

confusion, because the packaging of the two products resemble each

other too closely, then it gives rise to an actionable tort. There is also

merit in the contention that while ITC's variant is suitable to all age

groups, Britannia's is not on its own admission on the packaging suitable

for children because it has sucralose added. This can lead to possible

dilution of the reputation and goodwill attached to ITC's product. So long

as the deception persists, it would have an adverse impact on sales of this

particular product of ITC. A market leader like Britannia can certainly eat

into the market share of a relatively smaller player like ITC in the biscuit

trade by adopting a deceptive variant of the latter's get up and trade dress

but the converse may not be true. The new entrant with a product that

enjoys a growing popularity might require protection.

43. The three elements for an action of passing having shown to prima

facie stand fulfilled, the Court is satisfied that ITC has a prima facie case


in its favour and that the balance of convenience in granting an interim

injunction is in its favour. Since it is just about two months since

Britannia has introduced its variant with the impugned packaging, it is

likely to suffer a far less damage if the injunction were to be granted

when compared to the damage that ITC is likely to suffer if it is not

granted. Without such interim protection, ITC is likely to suffer

irreparable hardship since the loss of market share cannot adequately be

compensated later.

44. An interim injunction is, accordingly, issued restraining Britannia

from using the impugned packaging get-up/wrapper for its Nutri Choice

Digestive Zero biscuits in the present form during the pendency of this

suit. It will however be open to Britannia to adopt the packaging it uses

for the product internationally or while retaining the yellow colour,

substitute the blue colour in the impugned packaging with any other

distinctive colour other than variants of blue. In sum, it can adopt any

packaging which is distinctively different from the packaging that is

currently used by ITC for its Sunfeast Farmlite Digestive All Good

biscuits.

45. The Court grants Britannia four weeks' time to phase out the existing

stocks of Nutri Choice Zero Digestive biscuits with the impugned

packaging. Britannia will maintain true accounts of its sales of Nutri

Choice Zero Digestive biscuits with the impugned packaging from its

launch till the date of discontinuance in terms of this order.

46. The observations in this order touching on the merits are not intended

to influence the final decision that will be taken on an independent


assessment of the evidence led by the parties. The application is disposed

of.

S.MURALIDHAR, J

SEPTEMBER 06, 2016 Rm/sv:

Documents

$~ IN THE HIGH COURT OF DELHI AT NEW DELHI CS · PDF filelaunched cream biscuits under Sunfeast Dark Fantasy. It is further stated that thereafter ITC launched branded snacks, juices