In the bustling world of intellectual property disputes, where trademarks and copyrights often clash like titans, the case of Balar Marketing Pvt. Ltd. v. Lakha Ram Sharma Proprietor of Kundan Cable India stands out as a compelling narrative of legal interpretation and judicial reasoning. Decided on March 27, 2025, by the High Court of Delhi, this case delves into the intricate interplay between trademark infringement and passing off actions under Section 124 of the Trade Marks Act, 1999. At its core, the dispute revolves around the use of the "KUNDAN" trademark by two competing entities in the electrical goods market, culminating in a challenge to a Trial Court's order that stayed multiple suits pending rectification proceedings. This case study explores the factual matrix, procedural twists, legal arguments, and the judiciary's meticulous analysis, culminating in a ruling that clarifies the scope of stay provisions in trademark litigation.

• Detailed Factual Background:
  • The petitioner, Balar Marketing Pvt. Ltd., is engaged in manufacturing and marketing electrical goods under the trademark "KUNDAN" or "KUNDAN CAB," adopted since 1975.
  • The respondent, Lakha Ram Sharma, operating as Kundan Cable India, also uses "KUNDAN" and "KUNDAN CABLE" trademarks for electrical goods.
  • Legal battles over trademark infringement, passing off, and copyright violations began in the 1990s.
  • Multiple suits filed between 1994 and 2006 were consolidated for evidence recording.
  • Both parties accused each other of passing off and infringement, each claiming prior use.
     
• Detailed Procedural Background:
  • Litigation began with suits filed in 1994, including TM No. 70/2010 (renumbered TM No. 968/2016) and a counterclaim (CC No. 07/2015, renumbered TM No. 971/2016).
  • Additional suits included Suit No. 1371/1994 (TM No. 931/2016) and Suit No. 1497/1995 (TM No. 1030/2016).
  • Trial Court dismissed petitioner's interim injunctions in 2018, upheld by Delhi High Court in 2022.
  • In January 2025, the respondent sought a stay under Section 124 of the Trade Marks Act, 1999.
  • Trial Court stayed suits relying on Amrish Aggarwal judgment, except TM No. 931/2016.
  • Petitioner challenged the stay by filing CM(M)-IPD 5/2025 before the Delhi High Court.
     
• Issues Involved in the Case:
  • Whether the Trial Court erred in staying the suits involving passing off claims under Section 124.
  • Whether Amrish Aggarwal mandated a stay of passing off actions along with infringement suits.
  • Whether references to passing off in Amrish Aggarwal were binding precedent or obiter dicta.
  • Interplay between trademark and copyright claims.
     
• Detailed Submission of Parties:
  • Petitioner:
    • Argued that the Trial Court misinterpreted Amrish Aggarwal and treated obiter dicta as binding.
    • Claimed Section 124 applies only to infringement suits, not passing off actions.
    • Cited Puma Stationer v. Hindustan Pencils (2010) supporting continuation of passing off actions.
    • Emphasized judicial efficiency and disruption due to erroneous stay.
       
  • Respondent:
    • Defended the stay by claiming Amrish Aggarwal extended to passing off actions.
    • Asserted that even obiter dicta from a Division Bench binds a Single Judge.
    • Relied on Naseemunisa Begum and Crocs Inc. judgments for binding value of Division Bench observations.
       
• Detailed Discussion on Judgments Cited by Parties and Their Context:
  • Petitioner relied on:
    • Puma Stationer v. Hindustan Pencils (2010): Passing off actions could continue despite stay on infringement suits.
    • J.K. Oil Industries v. Adani Wilmar Limited: Supported separate treatment for passing off and infringement claims.
    • Mohinder Singh Gill v. Chief Election Commissioner: Obiter dicta are not binding.
    • State of Orissa v. Sudhansu Sekhar Misra: Only ratio decidendi is binding, not incidental remarks.
    • Gudri v. Ram Kishun: Inadvertent Full Bench remarks not binding.
       
  • Respondent relied on:
    • Amrish Aggarwal v. Venus Home Appliances: Extended stay requirement to passing off actions (disputed by petitioner).
    • Naseemunisa Begum v. Shaikh Abdul Rehman: Higher bench obiter dicta binding.
    • Crocs Inc. USA v. Aqualite India Limited: Observations binding even if lacking detailed reasoning.
       
• Detailed Reasoning and Analysis of Judge:
  • Contextualized Amrish Aggarwal as primarily about stay of infringement suits post-IPAB abolition.
  • Found reference to "passing off" in Amrish Aggarwal to be incidental and not binding.
  • Analyzed Section 124 as applying exclusively to infringement suits.
  • Relied on Puma Stationer to reinforce that passing off actions can proceed independently.
  • Distinguished respondent's cited cases as contextually inapplicable.
  • Held that blanket stay disrupted judicial efficiency, especially with trial at an advanced stage.
• Final Decision:
  • Petition allowed on March 27, 2025.
  • Trial Court's order of January 18, 2025, set aside.
  • All stayed suits (TM Nos. 968/2016, 971/2016, 1030/2016, and 932/2016) directed to proceed alongside TM No. 931/2016.
  • Trial Court directed to expedite proceedings given the age of suits.
• Law Settled in This Case:
  • Section 124 of the Trade Marks Act, 1999, mandates stay only for infringement suits, not passing off actions.
  • Obiter dicta, especially if inadvertent or unsupported by reasoning, are not binding on smaller benches.
  • Judicial flexibility preserved in interpreting statutory intent.

Case Title: Balar Marketing Pvt. Ltd. Vs. Lakha Ram Sharma Proprietor of Kundan Cable India
Date of Order: March 27, 2025
Case No.: CM(M)-IPD 5/2025
Name of Court: High Court of Delhi at New Delhi
Name of Judge: Hon'ble Mr. Justice Amit Bansal

Disclaimer:
The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539