THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 17.05.2010
IA No. 4600/2010 (under O.39 R.1 & 2 CPC) in CS(OS) No. 664/2010
M/S EUREKA FORBES LIMITED ..... PLAINTIFF
Vs
KENT RO SYSTEMS ..... DEFENDANT
Advocates who appeared in this case:
For the Plaintiff: Mr C Mukund with Mr G K Singh, Mr P V Sarvanaraja & Mr Firdaus Wani,
Advocates for the plaintiff.
For the Defendant: Mr Sudhir Chandra, Sr Advocate with Ms Rajeshwari Hariharan, Mr S K Tiwari
& Ms Vani Panta
CORAM :-
HON'BLE MR JUSTICE RAJIV SHAKDHER
1.
Whether the Reporters of local papers may
be allowed to see the judgment ? Yes
2. To be referred to Reporters or not ? Yes
3. Whether the judgment should be reported
in the Digest ? Yes
RAJIV SHAKDHER, J
IA No. 4600/2010 (under O.39 R.1 & 2 CPC)
1. By this order I propose to dispose of the captioned application. I may only notice
the fact that at the proceedings held on 15.04.2010 it had been agreed before me by
counsel on both sides that since the issue involved related to a particular advertisement
issued by the defendant, the suit could perhaps be finally disposed of on the basis of
documents and evidence by way of affidavits. Timeline were fixed for completion of
pleadings, filing of affidavits by way of evidence and additional documents, if any. It
had been made clear that in the event for some reasons the suit could not be disposed of
then, the plaintiff‟s application under Order 39 Rule 1 & 2 of the Code of Civil
Procedure, 1908 (in short „CPC‟) shall be heard. It appears that even though pleadings
have been completed and affidavits of evidence have been filed, the defendant has filed
certain additional documents to which the plaintiff‟s counsel has an objection. Thus, it is
CS(OS) 664-2010 Page 1 of 12
agreed before me by both counsels that the captioned application be taken up for hearing
based on the pleadings filed by both parties. The plaintiff agreed that the defendant could
rely on the first set of documents filed on 03.05.2010.
2. With this prefatory note, let me take up the captioned application for disposal.
The scope of controversy falls in a narrow compass. The plaintiff has impugned the
defendant‟s advertisement which is extracted at Page 19 of the plaint. For a better
appreciation of the controversy in issue, the impugned advertisement is extracted by me
hereinbelow:-
3. The gravemen of the plaintiff‟s case is that the impugned advertisement
disparages the water purifiers manufactured by it, which are based on both Ultra Violet
(UV) and Reverse Osmosis (RO) technology by comparing them with latest water
purifier manufactured by the defendant. In other words, it is the plaintiff‟s case that the
water purifiers shown in the advertisement, which are evidently based on UV or RO
technology, have been depicted in a poor light as compared to the defendant‟s product,
which is, a combination of RO and UV technology, in addition to its apparent ability of
carrying out ultra filtration (UF), and getting rid of turbidity and dissolved substances (in
short TDS).
CS(OS) 664-2010 Page 2 of 12
3.1 The plaintiff contends that they have been in the business of manufacture of water
purifier under the super brand aquaguard since 1982, and consequently as of today, has
more than 70% of the market share in water purification segment. It is further contended
that it operates in 135 cities across India, and has also expanded its business to 1515
towns and 400 small towns through its Franchisee Direct Operations (F.D.Os) and a
retinue of 13,000 dealers, spread all over the country. In nutshell, the plaintiff‟s claim is
that UV and RO are synonymous with it. As a matter of fact, in the plaint there is a
reference to various models of the products which are sold under a variety of brands and
sub-brands carrying the suffix UV, RO and UF. Some of these examples being:
Aquaguard Total Sensa SMP+ e-boiling-UV+RO+ UF (with Ultra Filtration), Aquaguard
Integra Hi Life (RO+UV+UF/NF), Aquaguard RO (Silver Nano Series), Aquaguard
Total RO Reviva, Aquaguard Total RO (Protec+), e.t.c.
3.2 Based on the above, it is contended that the reference to UV and RO in the
impugned advertisement could only be directed towards the plaintiff. It is further
submitted that the impugned advertisement shows purifiers based on UV and RO
technology in a poor light, as the advertisement first poses a question as to the purity of
the water and then alludes to the water purification machines. The ones which are based
on UV or RO technology are in effect shown as being less effective in treatment of water
as against the one manufactured and sold by the defendant which has a combination of
UV, RO, UF and TDS control technology. It is also contended that the impugned
advertisement sends out a false message in as much as it states that a water purification
machine, which is based on UV technology, can remove only bacteria and viruses,
whereas the truth is otherwise, which is, that such machine can in addition remove
dissolved impurities besides residues, micro organisms, chemicals, such as chlorine, as
also turbidity due to mud particles, amongst others. Similarly, a water purification based
on RO technology not only removes dissolved impurities, but does all that which, a water
purification machine based on UV technology can do. It is stated that a water
purification system based on RO technology can also remove minerals as also inorganic
CS(OS) 664-2010 Page 3 of 12
salts present in the water. It is the plaintiff‟s claim that while, it has no objection to the
defendant advertising its own product, which evidently has various attributes but it
certainly cannot discredit water purifiers based on UV or RO technology as such a
advertisement campaign directly effects the plaintiff market, in such like, products. The
plaintiff‟s contention is that the sole purpose of such a campaign launched by the
defendant is only to increase the market share of its own product at its cost. The plaintiff
claims that they have spent a lot of money in educating the customers and public at large
as to the type of water purification machines that they require, based on quality of water
available in their locality. The argument is that a water purifier based on RO technology
may be useful in areas where the water is hard and turbid, whereas in locations in which
it is not so, a water purifier based on UV technology may suffice. The reason being that:
if a water purifier based on RO technology is used in such areas it may exclude from the
water the bad as well as good minerals, therefore, denuding the water of its good qualities
and in the long run, it may be harmful to the health of the consumers.
4. The defendant, on the other hand, has averred that there is no disparagement of
the plaintiff‟s products as alleged or at all. It is averred that the plaintiff has failed to
disclose that the UV technology for water purification has been in existence for more
than 30 years, and that the plaintiff is not the inventor of the said technology. It is
specifically averred that the plaintiff has sought to convey that UV technology is
exclusively associated with the plaintiff‟s product and, therefore, by implication
disparages UV and RO based water purification machines marketed by the plaintiff. It is
averred that the suit instituted by the plaintiff has been instituted to harass the defendant
and to create non existent doubts in the minds of the consumers. It is averred that the
defendant and its predecessor has been in existence since 1999. Since the introduction of
the RO technology in 1999, the defendant has been using it for its own water purification
machines. The said water purification machines were sold by the defendant under the
mark KENT. A reference has been made in paragraph 4 of the written statement to the
various trade marks which have been registered or applied for. In paragraph 8 a reference
CS(OS) 664-2010 Page 4 of 12
has been made to its annual sales as also amounts spent on advertisements– which by no
standards are insignificant. The defendant specifically states that UV and RO
technology are not associated with the plaintiff‟s water purifiers. It is contended that
these are generic words and it cannot be monopolized by a single entity. It is further
averred that the copyright registration(s) secured by the plaintiff are irrelevant to the issue
raised in the present suit. In so far as its own machine is concerned, the defendant has
averred that even though it is desirable that the limit of T.D.S in water should not exceed
500 mg per litre, the minimum level of solids that can be present in the water has not
been standardized, and it varies from one geographical location to another. It is further
averred that in some cases where water is found to contain solids of 500 mg per litre, it
still contains harmful solids such as arsenic, iron dust etc; of very high levels, which
approximate to 200-300 mg per litre. Therefore, in such cases the levels of TDS are
required to be adjusted. The defendant claims that it has invented/devised a new water
purifying machine which can adjust the TDS in water to a desirable limit to cater to the
geographical location of the consumer. The defendant, in respect of this machine, which
is also shown in the impugned advertisement, has obtained a patent. The defendant
further submits that there is no attempt to disparage the plaintiff‟s product; as a matter of
fact the advertisement is issued only to promote its own machines and to inform the
public of the benefits of its products and range of products made available by the
defendant. It is further averred that the advertisement issued by the defendant states true
facts about different technologies i.e., RO, UV or the combination of RO+UF+UV+TDS.
It is claimed by the defendant that it manufactures all three variants of the water
purification machines. The stand, therefore, is: the products depicted in the advertisement
are exclusively the products of the defendant. In this context it is stated that the shape
and configuration of the plaintiff‟s product and that of the defendant are completely
different. (See Para 2(i) and (j) of the reply on merits of the WS) Since the assertions
made, in particular, of paragraph 2(j) being relevant are extracted hereinbelow:-
CS(OS) 664-2010 Page 5 of 12
“The products depicted in the advertisement are exclusively the products of
the defendant; the cabinets depicted are those of the defendant. The
advertisement only states facts about various products of the defendant. It is
a well known fact that the shape and configuration of the plaintiff’s
product and that of the defendant are completely different.”
(emphasis is mine)
5. In support of his submissions, Mr Mukund who appears for the plaintiff has
contended before me that the impugned advertisement is a case of direct disparagement.
This argument, of course, is premised on the averments made in the plaint that UV and
RO based water purification machines are relatable only to the plaintiff. In support of
this submission, the learned counsel has relied upon the judgment of the Karnataka High
Court in the case of Eureka Forbes Limited vs Pentair Water India Limited: 2007 (35)
PTC 556 (Karnataka). In the alternative, Mr Mukund has submitted that this Court in
several judgments has held disparagement could be both overt or covert, therefore, the
reference in the impugned advertisement to the water purification machines based on UV
and RO technology being less useful has resulted in committal of a tort qua the plaintiff.
The plaintiff is thus entitled to seek an appropriate relief from the Court. In support of
this submission, the learned counsel relied upon the judgment in the case of Dabur India
Ltd. vs Emami India Ltd. 2004 (29) PTC 1 (Del) and Reckitt Benckiser (India) Limited
vs Hindustan Lever Limited: 2008 (38) PTC 139 (Delhi). The last submission of the
learned counsel was that in any event the statement made in the advertisement is false, in
as much as it is a half truth as the water purification machines based on UV or RO
technology do more than what is indicated in the impugned advertisement. In support of
his submissions the learned counsel has relied upon the standards laid down by the
Bureau of Indian Standards (in short BIS) with regard to water purifiers. Based on the
standards laid down by BIS, it was contended that UV based water purifier is mandatorily
required to have an activated carbon filter which enables exclusion of dissolved
impurities such as mud solids etc. The argument was that the advertisement therefore
incorrectly alluded to the fact that a UV machine could only destroy bacteria and virus.
CS(OS) 664-2010 Page 6 of 12
6. In rebuttal, Mr Chandra who appears for the defendant, refuted the arguments of
the plaintiff. The main thrust of Mr Chandra‟s arguments was that the impugned
advertisement neither overtly or covertly refers nor alludes to the plaintiff‟s product. It is
contended that both UV and RO technology are available for use by those who are in the
business of manufacturing water purification machines, and, therefore, if the plaintiff‟s
argument was accepted it would amount to accepting its monopoly over a technology, of
which, it is not an inventor. The submission of Mr Chandra is that in the impugned
advertisement the defendant is attempting to demonstrate that it has graduated from
machines which are based on UV and RO technology to a more advanced water
purification machine which is a combination of UV, UF, RO and TDS control
technology. In support of his submission, Mr Chandra referred to the patent that the
defendant had acquired in respect of its most advanced machines i.e., the Mineral RO
water purifier (Mineral RO); which it presently manufactures alongwith those which are
based solely on UV and RO technology. Mr Chandra submitted that the advertisement
states only the facts with regard to UV and RO technology and there is no negativity
depicted qua any of the two technologies i.e., UV and RO. In other words, Mr Chandra‟s
contention is that the plaintiff‟s action for disparagement is based on a perception of
disparagement which cannot and ought not to be entertained by the Court.
6.1 In so far as the submission of the plaintiff as regards adherence to standards laid
down by BIS was concerned, Mr Chandra submitted that these standards allude to water
purifiers, and not to the technology involved. In any event, it was the learned counsel‟s
contention that the standards are not mandatory and only those who want to conform to
the said standards are required to adopt the same.
6.2 As regards the contention of the plaintiff that interim order dated 13.04.2005
passed in CS(OS) No. 492/2005 would operate against the defendant in so far as UV
based water purifiers are concerned, Mr Chandra submitted that it was an ex-parte interim
order which did not contain any reasons and hence, would not come in the way of the
Court in dealing with the impugned advertisement. Mr Chandra concluded by saying that
CS(OS) 664-2010 Page 7 of 12
the plaintiff was being „hyper sensitive‟ with regard to the impugned advertisement
which neither disparaged nor intended to disparage the plaintiff‟s product, as alleged, or
at all. In support of his submission, the learned counsel relied on the judgment of the
Division Bench in the case of Dabur India Limited vs Colortek Meghalaya Private
Limited and Godrej Sara-Lee 167 (2010) DLT 278.
6. I have heard the learned counsel for the parties. In view of the discussion above,
according to me the following points arise for consideration:-
(i) Whether the impugned advertisement overtly or covertly makes a reference to the
plaintiff‟s water purification machines?
(ii) If the answer to the first issue is in the affirmative, then does the impugned
advertisement disparage the plaintiff‟s product?
(iii) If the answer to the Issue Nos (i) and (ii) is in the affirmative, is the plaintiff
entitled to an injunction?
(iv) Is the impugned advertisement in line with the observations made by the Division
Bench of this Court in the case of Dabur India Limited (supra) made in
paragraph 23 at page 284 of the judgment.
POINT NO. I
7. The plaintiff‟s argument that there is a direct reference to its product or at least in
the alternative an indirect reference to it, is according to me untenable. The reason for
this is that this argument is entirely pivoted on the premise that the use of UV or RO
technology in relation to water purifiers is relatable only to the plaintiff. In my view,
nothing could be more inaccurate. UV technology as the literature produced by the
plaintiff itself would show the use of UV rays in the treatment of water. This process is
also known as electronic boiling. These ultra violet rays are supposedly more intense than
the normal sunlight and hence, help in eliminating water borne disease caused from
bacteria, viruses and protozoas. Similarly, a water purifier which is based on RO
technology involves usage of membranes which, act as filters to help remove
CS(OS) 664-2010 Page 8 of 12
contaminates from the water. RO is also referred to as “hyper filtration” — a technology
which is commonly used by companies which trade in bottled water, amongst others.
The fact that the plaintiff has obtained registrations or has filed applications for
registrations of trade mark which bear suffixes like UV and RO alongside the mark could
not, in my view, lead to a conclusion that UV and RO are related to plaintiff‟s products.
It is not disputed by the plaintiff that the defendant has also been using marks which
advert to the RO technology or to both RO and UV technology. The examples being:
KENT Mineral RO Water Purifier (logo), Mineral RO, KENT Ultra Violet Water
Purifiers (logo), KENT Mineral RO Double Purification Technology RO+UV+Minerals
(logo). This apart, the plaintiff has referred to a document at Page 122 which alludes to a
water purifier evidently manufactured by Philips. The said document bears the following
statement: “Philips Intelligent Water Purifier, with advanced UV technology and
Activated Carbon to purify water”. Therefore, in my view, this submission of the
plaintiff cannot be accepted.
8. In view of my finding at Point No. I, Point No. II does not arise for consideration,
however, since arguments have been advanced by the counsels that there is a generic
disparagement of water purifiers based on UV and RO technology, I shall deal with it.
Before I deal with specifics of this case, I may only advert to the principles as to what an
action of this kind entails. An action of this kind is really in the nature of “trade libel”.
The trade libel is variedly referred as “malicious falsehood” or “injurious falsehood”.
The Courts, however, have been using the expression malicious falsehood to describe a
tort of the kind involved in the present case as against “trade libel” as these expressions
perhaps present a narrower scope of the tort. For a plaintiff to succeed in an action for
malicious falsehood he would have to plead and prove that the statement made in the
impugned advertisement is untrue. The statement is made maliciously i.e., without just
cause or excuse and the plaintiffs have suffered damage by such an action of the
defendant.
CS(OS) 664-2010 Page 9 of 12
8.1 In my view, if one were to literally accept what UV technology or RO technology
can achieve what is stated in the impugned advertisement, is prima facie not false. It is
not in dispute that ultra violet rays are used to electronically boil water which results in
destructions of bacteria and viruses. Similarly, treating water by use of RO technology
results in removal of dissolved impurities. Therefore, by itself there is no case for
disparagement because what is stated is prima facie correct. This is more so, when seen,
in the light of the averments made by the defendant that what they are seeking to do is to
compare their own water purification machines which are based on UV or RO
technology, with a more advanced version manufactured by it. In this connection it is
alluded that the outline of the water purifier shown under the heading UV and RO are
those of the defendant‟s product, and not that of the plaintiff. This is not crucially
disputed by the plaintiff in the replication. The counsel for the plaintiff, on the other
hand, submitted that the advertisement should be more explicit, in as much as, it should
indicate in so many words that the machines shown under the caption UV and RO are
those which belong to the defendant (Kent). In my view, such an argument really skirts
the real issue, which is that the water purification machines shown in the impugned
advertisement are those which the defendant manufactures. If it is so, then the plaintiff‟s
submission to the contrary has to be rejected. The plaintiff, in any event, as noticed
above, has not denied the said assertion. The plaintiff would have to live with the stand
taken.
POINT No. III
9. In view of my findings in respect of Point Nos I and II, I am of the view that
plaintiff is not entitled to injunction as prayed for. The learned counsel for the plaintiff in
support of his submissions apart from what was stated also referred to the interim order
dated 13.04.2005 passed in CS(OS) No492/2005, based on which, the learned counsel for
the plaintiff has submitted that the defendant cannot violate the interim order by
comparing the water purifying system based on UV technology with the others in the
impugned advertisement. Mr Mukund in this regard also brought to my notice the fact
CS(OS) 664-2010 Page 10 of 12
that an interlocutory application being IA No. 3027/2005 was moved by the defendant for
vacating the said interim order on which notice was issued on 20.04.2005. The said
application according to the learned counsel is pending adjudication. In my view, the
contention of the learned counsel for the plaintiff is erroneous for the reason that the ex-
parte order which operates against the defendant is qua a different advertisement. The
fact that the plaintiff has filed a fresh suit demonstrates the fallacy in the argument. The
issuance of the advertisement which is subject matter of the dispute in the present suit
gave rise to a fresh cause of action, which is why, the plaintiff filed the instant suit and
the captioned application seeking injunction. If it was so covered by the earlier suit and
the order passed therein, it would have perhaps have proceeded to file an application for
contempt for seeking enforcement of the said order. Therefore, in my view, this
submission cannot be accepted.
10. In so far as the judgments cited by the learned counsel for the plaintiff are
concerned, on facts, in my view, they are not applicable. What is observed in Dabur
India Limited vs Emami Limited in principle holds good. On facts the present case is
distinguishable. Similarly, the case of Reckitt Benckiser (India) Limited Vs Hindustan
Lever Limited on facts is not applicable. A perusal of the facts would show that there
was a reference to the plaintiff‟s product in as much as the shape and colour were referred
to by implication since the defendant had adopted the shape and the colour of “dettol
soap”. Such is not the situation in the present case. In so far as the judgment of the
Karnataka High Court in the case of Eureka Forbes Limited vs Pentair Water India
Limited is concerned, the same is based on the premise that Aquaguard and UV
technology are synonymous. With respect, I am not able to bring myself to agree with
the view expressed therein.
POINT No. IV
11. However, I am afraid in respect of the last issue I have not been able to persuade
myself that the defendant ought not to clearly indicate in the impugned advertisement as
to what are the other attributes of a water purification machines which are based on UV
CS(OS) 664-2010 Page 11 of 12
and RO technology. This issue attains greatest significance in the instant case in view of
the fact that it is the defendant‟s stand in the written statement that the comparison of its
latest machine is with its own water purification machines which are based on UV and
RO technology. It is not the stand of the defendant that its own water purification
machines which are based on UV and RO technology have limited attributes, as indicated
in the impugned advertisement. Therefore, in a sense it is beyond the „grey areas‟ to
which the Division Bench of this Court has alluded to in the judgment of Dabur India
Limited vs Emami Limited. In my opinion, it would help the cause of a common
consumer if the defendant in line with its own stand indicates the other attributes of its
water purification machines which are based on UV and RO technology. The defendant
cannot argue that its water purification machines do not contain an activated carbon filter
and hence, are incapable of removing other impurities apart from destroying bacteria and
viruses. I would imagine same is the case with its water purification machines which are
based on RO technology. A good example is that of the machines manufactured by
Philips to which I have made a reference hereinabove. I, therefore, direct that the
defendant shall make suitable amendments in the impugned advertisement to bring to
fore the other attributes of the water purification machines shown under the caption UV
and RO in the impugned advertisement. The order dated 15.04.2010 passed by me is
accordingly modified. The captioned application is disposed of with the aforesaid
observations. This arrangement shall obtain during the pendency of the suit.
12. Needless to say any observations made hereinabove will not come in the way of
decision on merits.
RAJIV SHAKDHER, J
MAY 17, 2010
mb
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