Industria De Diseno Textil, S.A. v. Registrar of Trade Marks & Anr.

15. It was also argued that Appellant cannot claim monopoly on all goods not only in different classes but even in the same class for which the trademark ZARA is not registered. In Vishnudas Trading as Vishnudas Kishendas v. Vazir Sultan Tobacco Co. Ltd., Hyderabad and Another, (1997) 4 SCC 201, the Supreme Court categorically held that a proprietor of the trademark cannot enjoy monopoly over the entire class, specially, when he is not using the mark for those goods. The same position of law was reiterated by the Supreme Court in Nandhini (supra). The judgments relied upon by the counsel for the Appellant are clearly distinguishable. The case of Usha International (supra), was decided on different facts where the impugned marks ASHA and the logo as also the mark BUTTERFLY were held to be deceptively similar to Plaintiff’s mark and were used in relation to identical goods i.e., sewing machine, which is not the case here. In Industria de Diseno (supra), the rival marks were ZARA and ZARA TAPAS BAR and therefore, the infringement was clear, whereas in the present case Respondent No.2’s mark is ZORA, which is wholly dissimilar to ZARA. The judgment in Pfizer Products (supra), is inapplicable to the present case for two reasons, firstly, the rival marks VIAGRA and VIGOURA were deceptively similar and secondly, the case involved pharmaceutical products and that too for the same treatment and it is settled that in case of pharmaceutical products the tolerance to confusion must be very low.

16. Heard learned counsels for the parties and examined their rival submissions.

17. By this appeal, Appellant seeks quashing of impugned order dated 08.02.2024, whereby Respondent No.1 has dismissed the opposition filed by the Appellant and allowed the application of Respondent No.2 for registration of the mark ZORA in Class 24. Broadly understood, Appellant had opposed registration of the mark ZORA on the ground that its mark ZARA is inherently distinctive and was conceived and adopted by the Appellant as early as in 1970s and is registered in several classes including Class 24 and fulfils all parameters of being entitled to protection as a wellknown mark under Section 2(1)(zg) of 1999 Act and hence, registration of ZORA, which is deceptively similar to ZARA, both visually and phonetically, is proscribed under Section 11(2) of 1999 Act as the use of ZORA will take unfair advantage of or be detrimental to the distinctive character or repute of ZARA, even assuming that Respondent No.2 seeks registration in respect of dissimilar goods, while strenuously contesting that the impugned goods are dissimilar. Respondent No.2, on the other hands, contests the appeal and the opposition on the ground that ZORA is not deceptively similar to ZARA and giving preference to prefixes ‘ZO’ and ‘ZA’, when the suffix ‘RA’ is common, there is neither any phonetic nor visual similarity. Respondent No.2 has also questioned the applicability of Section 11(2) on the ground that ZARA is not a declared well-known mark and hence, Appellant has no right to oppose registration of a mark in respect of dissimilar goods, which in the instant case are polyester lining fabric for bags. In fact, Respondent No.2 seriously opposed the stand of the Appellant that it manufactures and sells bags per se and has taken a position that it only supplies polyester lining fabric to manufacturers of bags.

18. Perusal of the impugned order passed by Respondent No.1, rejecting ZARA’s opposition shows that the Registrar has returned a finding that the rival marks ZARA and ZORA are neither phonetically nor visually similar. In order to compare the marks, Respondent No.1 first observed that the two words must be taken and judged by their looks and by their sound and thereafter, proceeded to first compare them phonetically. To do so, the that in ‘ZO’, the emphasis is on the first syllable with a flowing and elongated ‘o’ sound while in ‘ZA’ it is on ‘a’ sound and thus they were phonetically dissimilar. For a visual comparison, Respondent No.1 observed that both the marks feature the suffix ‘RA’ and therefore, a comparison must be made between the prefixes ‘ZO’ and ‘ZA’ and if the two are compared in block letters, they are dissimilar and there is no likelihood of confusion or deception. Having so held, Respondent No.1 posed a question whether an average man, on seeing the two marks may get confused or deceived and answered the same by holding that the likelihood of the rival products being seen together in one place/counter was negligible as the trade channels and consumer base were totally different. Respondent No.2 is a manufacturer/ wholesaler of raw laminated fabric at Sadar Bazaar, Delhi which is used in the inner lining of the bags by the manufacturers and sold in rolls (in meters) and hence, the consumers are bag manufacturers, whereas the Appellant sells end products and not raw products and its goods are available at its exclusive stores/websites only. Dealing with the argument of the Appellant that even if the goods are dissimilar, mark ZARA is liable to be protected under Section 11(2), since it is a well-known mark, Respondent No.1 rejected the same on the short ground that the rival marks were dissimilar, hence, similarity or dissimilarity of goods was immaterial. Argument of the Appellant that Respondent No.2 has dishonestly adopted the mark ZORA was not accepted for the same reason that the rival marks were different. Tangentially, Respondent No.1 also ventured into the English meaning of the mark ZORA which means ‘dawn’ and accepted the version of Respondent No.2 that adoption was in good faith as use of polyester fabric (Andaras), which is known for its versatility, durability and water resistance, was a new beginning in the making of bags. Respondent No.1 has also rightly held that Appellant had placed no evidence on record to show any actual confusion among the public or the dishonest adoption by Respondent No.2.

19. Before proceeding to consider the rival contentions of the parties on merit, it is pertinent to look at the applicable provisions under the 1999 Act. Section 11 of 1999 Act deals with relative grounds for refusal of registration. Sub-Section (1) proscribes registration of the trademark if it is identical with an earlier trademark and there is similarity of goods or services covered by the trademark or where the trademark sought to be registered is similar to an earlier trademark and there is identity or similarity in goods/services covered by the trademark and there is likelihood of confusion on the part of the public including likelihood of association with the earlier trademark. Sub-Section (2) proscribes registration of a trademark if it is identical with or similar to an earlier trademark but the goods/services are dissimilar, if or to the extent the earlier trademark is a well-known trademark in India and use of the later mark without due cause, would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trademark. Therefore, the commonality in the two sub-Sections is identity/similarity with ‘earlier trademark’, which expression has been defined in Explanation (b) to the Section, but the difference is that (1) is confusion centric with similarity/identity of goods/services and (2) is based on distinctiveness and dilution/unfair advantage with goods/services being dissimilar. For ready reference, Explanation is as follows:- “Explanation.—For the purposes of this section, earlier trade mark means— (a) a registered trade mark or an application under section 18 bearing an earlier date of filing or an international registration referred to in section 36E or convention application referred to in section 154 which has a date of application earlier than that of the trade mark in question, taking account, where appropriate, of the priorities claimed in respect of the trade marks; (b) a trade mark which, on the date of the application for registration of the trade mark in question, or where appropriate, of the priority claimed in respect of the application, was entitled to protection as a well-known trade mark.”

20. There is no dispute between the parties that ZARA is a registered mark in India and its earliest registration dates back to 07.04.1993 in Class 25. ZARA was registered in Class 24 on 19.06.2003, which is the relevant class in the instant case. Therefore, going by the statutory prescription of Section 11(2), the first and foremost question that needs an answer is whether ZARA is an earlier well-known trademark and if the answer is in the affirmative then the second question that will arise for consideration will be whether ZARA and ZORA are deceptively similar so as to cancel the registration of the mark ZORA, even assuming the rival goods are dissimilar, which issue is also heavily contested.

21. Contention of Respondent No.2 on this aspect is that ZARA is not an earlier well-known trademark under Section 11(2), since it has not been so declared by any Court nor included in the list of well-known mark by the not envisage a formal declaration and if the proprietor of an earlier registered similar/identical mark can establish through cogent evidence that it has acquired substantial and extensive reputation, tested on the factors under 11(6) read with 2(1)(zg), the opposition will be valid against a similar/identical mark. Having given my careful consideration to the language of Section 11(2), I am of the view that the contention of Respondent No.2 only deserves to be rejected inasmuch as the provision does not require the earlier trademark to be a declared well-known mark either by the Court or by the Registrar. Section 11(2) provides that ‘mark is a well-known trade mark in India’ and not that the mark is a declared wellknown mark and/or is included in the list of well-known marks by the of Section 2(1)(zg) i.e., it has become well known to the substantial segment of the public in India, which uses the goods or receives services in relation to which the mark is used and is likely to be taken as indicating a connection in the course of trade and the factors to be considered for such assessment and determination are given in Section 11(6). This is evident from Explanation (b) to Section 11 which explains ‘earlier trademark’ as a mark which is registered on the date of the application for registration of the trademark in question and is ‘entitled to protection as a well-known trademark’. The word ‘entitled’ in Explanation (b) is not without significance inasmuch as ‘entitle’ as defined in Black’s Law Dictionary means ‘to grant a legal right to or qualify for’ and ‘entitlement’ means ‘an absolute right to a benefit’ and cannot be construed to mean ‘declared’. For ready reference, relevant sub-Sections of Section 11 are as follows:- “11. Relative grounds for refusal of registration.—(1) Save as provided in section 12, a trade mark shall not be registered if, because of— (a) its identity with an earlier trade mark and similarity of goods or services covered by the trade mark; or (b) its similarity to an earlier trade mark and the identity or similarity of the goods or services covered by the trade mark, there exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the earlier trade mark. (2) A trade mark which— (a) is identical with or similar to an earlier trade mark; and (b) is to be registered for goods or services which are not similar to those for which the earlier trade mark is registered in the name of a different proprietor, shall not be registered if or to the extent the earlier trade mark is a wellknown trade mark in India and the use of the later mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trade mark. xxx xxx xxx (4) Nothing in this section shall prevent the registration of a trade mark where the proprietor of the earlier trade mark or other earlier right consents to the registration, and in such case the Registrar may register the mark under special circumstances under section 12. Explanation.—For the purposes of this section, earlier trade mark means— (a) a registered trade mark or an application under section 18 bearing an earlier date of filing or an international registration referred to in section 36E or convention application referred to in section 154 which has a date of application earlier than that of the trade mark in question, taking account, where appropriate, of the priorities claimed in respect of the trade marks; (b) a trade mark which, on the date of the application for registration of the trade mark in question, or where appropriate, of the priority claimed in respect of the application, was entitled to protection as a well-known trade mark. (5) A trade mark shall not be refused registration on the grounds specified in sub-sections (2) and (3), unless objection on any one or more of those grounds is raised in opposition proceedings by the proprietor of the earlier trade mark.”

22. Plain reading of Section 11(2) does not support the argument of requirement of prior declaration of the earlier trademark as a well-known mark. At the cost of repetition, the phrase in Section 11(2) carefully used by the legislature is ‘mark is a well-known trade mark in India’ and not ‘the mark is a declared well-known mark and/or included in the list of wellknown marks by the Registrar’ and thus the Registrar is required to determine if tested on the factors under 11(6), the earlier mark has acquired immense and substantial reputation and is entitled to protection as a wellknown mark so as to oppose cancellation of a similar/identical mark in respect of dissimilar goods. Thus, the enquiry under Section 11(2) is whether opponent’s mark is substantially well known amongst the relevant segment and enjoys immense and extensive reputation in India and not whether there is a prior formal declaration as a well-known mark. Had the legislature intended the earlier mark under Section 11(2) to be a declared well-known mark, the provision would have so stated expressly and in the absence of an express exposition to this effect, it is not open to the Court to substitute words in statutory provisions beyond what has been legislated.

23. The central theme of Section 11(2) is the well-known status and repute of the earlier registered mark and its protection so that the Register of Trade Marks does not include a later mark, which owing to its similarity/identity, takes unfair advantage of or is detrimental to the distinctive character or repute of the earlier mark. The right to oppose registration under 11(2) thus arises from the well-known nature of the earlier mark and is not dependant on its formal declaration as a well-known mark, in my considered view. The legislative intent is clear from the common thread that runs in sub-Section (5), which provides that a trademark shall not be refused registration on the grounds specified in sub-Sections (2) and (3), unless objection on any one or more of those grounds is raised in opposition proceedings by the proprietor of the ‘earlier trademark’ and does not require that the opponent should be a proprietor of a ‘declared’ well-known mark.

24. I am fortified in my view by the judgment of the Madras High Court in Lego Juris A/S v. Gurumukh Singh and Another, 2024 SCC OnLine Mad 4858, where the Court was dealing with rectification petitions under Section 57 of 1999 Act and the Petitioner who was the registered proprietor of the mark LEGO sought removal of the mark LEGO adopted by Respondent No.1 for its confectionery products from the Register of Trade Marks. Be it noted that Petitioner’s mark was declared as well-known trademark in foreign jurisdictions and Section 11(2) was invoked for cancellation of the registration. Respondent No.1 contended that its adoption of LEGO was bona fide and that its registration was in a class different from the class for which Petitioner’s LEGO mark was registered and hence, the goods were wholly dissimilar. Objection was also taken that Petitioner’s mark was not a declared well-known mark as contemplated under Section 11(6) read with Section 2(1)(zg) of 1999 Act, besides disputing the similarity in the rival marks. Madras High Court took the view that Explanation (b) to Section 11(4) clarifies that an earlier trademark would also include a trademark which was entitled to protection as well-known mark on the date of the application for registration by the rival party de hors the nature of goods and/or trade channels, meaning thereby that it is not mandatory to have a prior declaration under Section 11(2) for opposing registration of an identical or similar mark. Madras High Court observes that even though Petitioner’s declaration was pending and as and when granted will be prospective but construing the provisions of Section 11(2), the LEGO mark of the Petitioner will be entitled to be protected against the identical mark of Respondent No.1, even though the goods were way different. This judgment, therefore, highlights that to seek protection under Section 11(2) and oppose the registration of an identical/similar mark, the earlier trademark must only satisfy the requirement of being a mark ‘entitled’ to protection as a well-known mark as provided under Section 2(1)(zg).

25. The above position also finds support from Rule 43 of the 2017 Rules, which in respect of a Notice of Opposition or on an earlier right on which the opposition is based and provides that “where the opposition is based on an earlier trade mark which is alleged to be a well-known trade mark within the meaning of sub-section 2 of section 11[…]”. The language of this Rule is also a pointer to and furthers the interpretation that opposition under Section 11(2) is not conditioned by declaration of a mark as a well-known and the registered proprietor of the earlier mark has only to satisfy through evidence that it fulfills all parameters under Sections 11(6) and (7) read 2(1)(zg) and is entitled to protection as a well-known mark. Any other interpretation would render the Explanation (b) and Section 11(5) as also the corresponding Rule, otiose. Legislature in its wisdom deliberately chose not to use the term “declared” since before the amendment to the Trade Marks Rules in 2017, whereby Rule 124 was introduced, the only way to seek a declaration of well-known trade mark was perhaps to engage in adversarial proceedings, such as law suits for infringement, passing off, cancellation, opposition, etc. Additionally, even in the definition of well-known trademark, legislature has consciously used the words “a mark which has become so to the substantial segment of the public”, which only means a substantial segment of the public that patronizes the product/service associated with the earlier trademark. The whole objective of the protection extended to a well-known mark is to ensure that a mark, which is similar/identical, does not dilute its reputation and the character. Furthermore, legislature has consciously used two distinct terms, i.e. “wellknown” trademark in Section 11 (2) and “determined to be well known” in Section 11 (8). The golden rule of interpretation stipulates that words and phrases in a statute must be given their ordinary meaning. Therefore, the contention of Respondent No.2 that in the absence of a formal declaration of the mark ZARA, opposition by the Appellant was misconceived, is rejected and it is held that there is no statutory prescription under Section 11(2) that the proprietor of an earlier mark must first obtain a declaration of ‘wellknown trademark’ status before invoking the provision in opposition proceedings. Section 11(2) merely requires that the earlier mark is wellknown in India and the Registrar is empowered to determine whether the mark is well-known by considering factors under 11(6) and (7), including duration and extent of use, extent of promotion, recognition among relevant public, registrations and record of enforcement etc. by looking into evidence led by the opponent.

26. Appellant had extensively averred before Respondent No.1 and also placed overwhelming evidence in the form of supporting documents reflecting that it is an internationally reputed company engaged in manufacture, design, sale and distribution of fashion and related lifestyle and home products in several classes including Classes 24 and 25. Appellant is a conglomerate of over 400 companies with 1,70,000 employees and one of the largest fashion distribution groups in the world. Appellant sells its goods on a global scale in 215 markets through online platforms and has over 6,423 stores in 95 markets under several brands, the leading one being ZARA. Inditex Trent opened its first ZARA store in 2010 in Delhi and Mumbai. In 2011, Inditex opened 483 stores in 49 countries followed by new stores in 56 markets in 2015. As in 2019, Inditex was selling in 202 markets with 96 physical stores and 66 online platforms and in India, ZARA had 21 stores on the date of filing this appeal. It is brought forth by the Appellant that the expenses incurred by Inditex towards manufacturing of Appellant’s products bearing the ZARA marks in India steadily increased from Euro 42,812,063 in 2003 and in the year 2018 alone they were to the tune of Euros 116,877,249 upto 30.05.2018. In Industria de Diseno (supra), Court has held that host of documents on record show that ZARA is a well known mark and had transborder reputation even as in 2003, when the rival party therein had started its bar and restaurant. It is also observed in the judgment that while the first ZARA store was opened in India in 2010 but the documents showed that Appellant was getting fabrication done from various exporters in India even prior thereto and this fact is also brought forth in the present appeal categorically stating that ZARA has been in use since 1986-87 through its contract manufacturers. Having recognized the well-known status of the ZARA mark, the Court restrained the Defendants from carrying on their business of bar and restaurant under the name ZARA TAPAS BAR even though the hotel and hospitality business was completely unrelated to the goods of ZARA. This plethora of evidence has been completely overlooked by Respondent No.1.

27. Respondent No.2 filed the application for registration of ZORA on 03.10.2019 with user claim from 03.06.2016 and it needs no gainsaying that even in 2016, ZARA had achieved the status of a well-known mark owing to its immense reputation evidenced through its extensive sales, expenses etc. and more importantly, this fact is judicially recognised by this Court in Industria de Diseno (supra). Therefore, in my view, from the documents indicating a large retail network and online presence in India; extensive sales turnover; substantial expenses incurred and extensive advertising; diversified portfolio of products such as bags, apparel, headwear, footwear, accessories as also transborder reputation, Appellant has proved the strength of the mark ZARA and it satisfies all factors under Section 11(6) of 1999 Act read with Section 2(1)(zg), having achieved public and customer recognition. Therefore, de hors the formal declaration of the mark ZORA as a well- known mark, it cannot be denied that ZARA is entitled to protection as a well-known mark under Section 11(2) read with Explanation (b) and thus entitled to file opposition against registration of the mark ZORA.

28. Coming to next question as to whether rival marks are deceptively similar, I am of the view that even on this score, Respondent No.1 has seriously erred and applied a wrong test to compare ZARA and ZORA. It is trite that in deciding the similarity between two rival marks, they have to be seen as a whole and in this context, I may refer to the judgment of the Supreme Court in Corn Products (supra), relevant paragraph of which is as under:-

29. The Division Bench of the Bombay High Court in Encore Electronics (supra), while comparing the marks ANCHOR and ENCORE observed that the overall impression conveyed by a mark as a whole has to be assessed in evaluating whether the mark of the Defendant is deceptively similar to that of the Plaintiff. It was also held that phonetic similarity constitutes an important index of whether a mark bears a deceptive or misleading similarity to another as the phonetic structure indicates how the rival marks ring in the ears. On this touchstone, it was observed that phonetic similarity between ANCHOR and ENCORE was striking when seen as a whole. Division Bench of this Court in M/s. South India Beverages (supra), emphasized on the anti-dissection rule albeit in the context of composite marks. Contrary to the settled legal proposition, Respondent No.1 dissected ZARA and ZORA and compared the dissected parts of the marks i.e., ‘ZA’ and ‘ZO’ instead of looking at the marks on an overall impression and concluded that they were phonetically and visually dissimilar, which is completely untenable in law.

30. In this context, I may first allude to the judgment in Corn Products (supra), where the Supreme Court held that the marks GLUCOVITA and GLUVITA were similar and likely to cause confusion or deception in the mind of a person with average intelligence and imperfect recollection and negated the contention that syllable ‘CO’ in the Appellant’s mark was an emphatic characteristic which was not likely to be slurred over. The test of phonetic similarity was accepted by the Supreme Court in Amritdhara Pharmacy v. Satya Deo Gupta, 1962 SCC OnLine SC 13, as also subsequently, in Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceuticals Laboratories, 1964 SCC OnLine SC 14. In Cadila Health (supra), the Supreme Court held that principle of phonetic similarity cannot be jettisoned even when the manner in which competing word is written is different. Following these judgments in Encore Electronics (supra), the Bombay High Court examining the marks ANCHOR and ENCORE and held that Court must have realistic consciousness of the fact that the marks are used in Indian market and it is a consumer in India whose observation and assessment must guide the decision making. The manner in which rival marks would be ordinarily pronounced and the manner in which they would be written in Indian languages would be an important indicator of deceptive similarity. It was held that the learned Single Judge has rightly observed that the marks contain an overwhelming emphasis on letters ‘ENCOR’ and the fact that the mark of the Plaintiff begins with an ‘A’ while the mark of the Defendant begins with ‘E’ would make little difference to the manner in which the rival marks are pronounced. In Inter Ikea Systems BV v. Annanya Gautam and Another, 2018 SCC OnLine Del 11665, this Court held that phonetic and visual similarities are disjunctive and as long as either test is satisfied, similarity stands established. Referring to several judgments on the issue and examining the rival marks IKEA and IKAH, the Court held that they were phonetically and visually similar. In Mex Switchgears Pvt. Ltd. v. Max Switchgears Pvt. Ltd., 2014 SCC OnLine Del 854, this Court reiterated that overall impression of the mark in the minds of general public has to be considered by the Court and not by merely comparing the dissimilarities in the two marks and concluded that the two rival marks MEX and MAX are phonetically, visually and structurally similar.

31. In Ciba Ltd. Basle Switzerland v. M. Ramalingam and S. Subramaniam trading in the name of South Indian Manufacturing Co., Madura and Another, 1957 SCC OnLine Bom 45, Bombay High Court held that resemblance between CIBA and CIBOL, both visual and phonetical, becomes marked and pronounced if one attaches greater importance to the first syllable. In Essco Sanitations (supra), it was observed that vowels ‘o’ and ‘e’ are most likely to be mispronounced while comparing the marks ESSCO and OSSO and the marks were too close phonetically, visually and similarity in idea. The two letters ‘SS’ and the last letter ‘O’ are common in the two marks and there is no manifest difference in the two, selecting the letter ‘C’ from ESSCO and substituting the first letter ‘O’ in place of ‘E’. Ordinary customers, who are likely to purchase the goods are not expected to carry in their heads the miniscule details and very seldom a purchaser will have the two marks actually before him at the time of purchase and very often will only have a general recollection of what the nature of the trademark is. In Ajanta Pharma (supra), the competing marks were OLPET and OLOPAT and the Court held that the distinction between the two is of one missing vowel, which is used by the Plaintiff and substitution of another vowel i.e., capital ‘A’ for a capital ‘E’ and in terms of pronunciation, nobody is going to make this distinction between the two marks and two are likely to be confused in common speech. Even visually, the marks are far too similar and there is no reason for Defendants to have adopted the mark OLPET so close to OLOPAT. In Sulphur Mills (supra), the Bombay High Court was dealing with the marks FORTIS and FERTIS and found them to be visually, structurally and phonetically similar and held that the difference in vowel ‘e’ and vowel ‘o’ will not lend meaningful distinction.

32. Applying the aforesaid judgments to the instant case, I will now examine the two rival marks ZARA and ZORA. Both are word marks and contain four letters and are written in capital letters. Coming to the phonetic aspect, ZARA is pronounced as ZA-RA and ZORA is pronounced as ZO- RA. While pronouncing the marks, both end with the sound ‘RA’ and have the same rhythm and while there is a difference in the vowel sound of ‘a’ and ‘o’ but to an average man with imperfect recollection, the overall sound in the ears will be almost alike. Hence, the two words are phonetically deceptively similar. On visual similarity, both have four letters and the first letters are ‘Z’ and both end with ‘RA’ which means that they have the same consonant structure Z-R-A and the only change is in the vowel. Therefore, Respondent No.1 has completely erred in coming to a conclusion that there is no similarity in the two competing marks and this singular conclusion has weighed with the Registrar to negate all other contentions of the Appellant that ZARA being a well known mark is entitled to protection even against dissimilar goods and/or that Respondent No.2 adopted the mark ZORA dishonestly.

33. Coming to the aspect of dissimilarity of competing goods, which is one of the main planks of the argument of Respondent No.2, this aspect in fact becomes irrelevant in the context of Section 11(2), which provides protection to the earlier well known mark even against dissimilar goods as held by the Madras High Court in Lego Juris (supra). This issue also came up before this Court in Sanjay Chadha and Another v. Union of India and Another, 2022 SCC OnLine Del 509, in a writ petition considering a challenge to an order passed by IPAB, whereby rectification/cancellation petitions were allowed resulting in removal of registered trademarks EVEREADY. Petitioners were engaged in the business of manufacturing and marketing hand tools under the trademark/label EVEREADY while the Respondent was in the business of inter alia dry cell batteries, flash lights, CFLs and GSLs. Court upheld the order of IPAB and held that the two competing marks were identical and in terms of Section 11(2) it did not matter whether the competing trademarks were in respect of similar goods or not and IPAB had rightly concluded that the mark in question can be protected even in relation to dissimilar goods albeit the Court found that the competing goods were allied and cognate. The Court further observed that the only test to be applied was whether the earlier trademark was a wellknown trademark and whether the use of the later mark would be detrimental to the distinctive character or repute of the earlier trademark and the answer to both the questions in the said case was in the affirmative and therefore, the Respondent would be entitled to benefit of Section 11 of 1999 Act. In fact, in the said case, the Court also found that the adoption of the identical mark by the Petitioners was dishonest and without any reason. This judgment was upheld upto the Supreme Court. This contention is therefore rejected. Since Section 11(2) grants protection to a well-known mark even qua dissimilar goods, this Court need not delve into the extensive arguments of the parties regarding the similarity or dissimilarity of goods.

34. While it may not be necessary to go into the aspect of similarity in rival goods but for the sake of record, it would suffice to note that even this argument of Respondent No.2 cannot be accepted. Both ZARA and ZORA are registered in Class 24, which covers textiles and fabrics. ZARA is associated with clothing and fashion goods as also bags and the brand exposure includes interaction and purchases from manufacturers, traders and suppliers who in turn deal with various kinds of articles including clothing, textiles, bags and therefore, it cannot be said that polyester fabric lining for bags is a wholly unrelated activity and there is certainly a connection in the course of trade and in this context, learned counsel for the Appellant rightly relied on the judgement in Punjab Tractors Ltd. (supra,) where the Court found a trade connection between tractors and diesel oil engines.

35. Respondent No.1 has committed yet another glaring error in the impugned order by denying the claim of the Appellant on the ground that there is no evidence of actual confusion amongst public on record. In my view, the enquiry of confusion was a misplaced enquiry and has no place in examination for registration/opposition under Section 11(2), which by its plain reading restricts the enquiry to whether the use of the later mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trademark and which is why protection is granted against dissimilar goods. The test of likelihood of confusion is a test under Section 11(1) and not Section 11(2) and clearly the emphasis in Section 11(2) shifts from ‘consumer confusion’ to protection of the reputation and distinctiveness of a well-known mark and its dilution. In DLF Limited (supra), this Court held as follows:-

36. In Tata Sons (supra), this Court held that the doctrine of dilution, which has recently gained momentous, particularly in respect of well-known trademarks emphasises that use of a well-known mark even in respect of dissimilar goods/services, though may not cause confusion amongst the consumers as to the source of goods/services but may cause damage to the reputation which the well-known trademark enjoys by reducing or diluting the trademark’s power to indicate the source of goods/services. ZARA mark had acquired an extensive and enviable reputation well before Respondent No.2 applied for registration of ZORA in 2016 and in fact, ZARA had an expansive portfolio of a wide range of products and was recognized as wellknown by this Court in 2015. Respondent No.2 had no honest reason or cause to adopt a deceptively similar name ZORA, save and except, to take unfair advantage of ZARA for its polyester fabric by riding on the coattails of the said mark. In fact, Appellant has placed on record documents to show that since the adoption of the mark ZORA, the sales of Respondent No.2 suddenly rose from Rs.2,45,75,777/- in the financial year 2016-2017 to Rs.31,34,10,412/- upto 02.03.2023. The primary function of a trademark is to establish connection in the course of trade, which is not merely confined to an ultimate purchaser. In the instant case, use of the trademark ZORA will cause detriment to the distinctive character and repute of the mark ZARA and will also obstruct and adversely affect the trade connection built by ZARA amongst its traders, dealers, middleman, manufacturer and retailers in respect of same or similar fabric or textiles. Appellant has brought on record documents to show that Respondent No.2 is not only dealing in polyester fabric for bags but is also supplying polyester based rolls to its customers which includes textile dealers etc., who sell textile pieces in their shops. The mark ZORA has been displayed prominently on the packaging of the rolls and it cannot be figured out whether they are used for inner lining of bags or clothing items and it is clear that more often than not the customers will be misled into believing that Respondent No.2 supplies these rolls on behalf of ZARA or has some connection with the brand which will result in dilution of the brand as also the distinctive character of the mark.

37. The judgments relied upon by Respondent No.2 do not help in furthering its case. In Vishnudas Trading (supra), the Supreme Court held that proprietor of a trademark cannot enjoy monopoly over the entire class, specially when he is not using it for certain goods in that class. The proposition cannot be debated or disputed. However, the facts of the case were completely different inasmuch as the mark in question was CHARMINAR and was a commonly known word, being the name of a monument and the dispute concerned use of the mark in relation to tobacco products. In the present case, the mark ZARA is entitled to protection as a well-known mark under Section 11(2) and can oppose a similar/identical mark for dissimilar goods. The judgment in Vishnudas Trading (supra), prevented trafficking in trademarks by proprietors who have no intent to use them, which is not the case here and statutory regime under Section 11(2) prohibits adoption of a well-known trademark in a manner which takes unfair advantage of or is detrimental to its distinctive character or repute. The same legal proposition arises from the judgment in Nandhini Deluxe (supra), i.e., a proprietor cannot enjoy monopoly over the entire class. Mark Nandhini was not a well known trademark and was found to have a common and mythological connotation with a Hindu deity and the Supreme Court in the context of the facts in that case held that since the competing businesses operated in separate commercial fields, use of the marks did not disturb the existing market position of the party. The judgment in Cadila Healthcare (supra), concerned the competing marks FALCITAB and FALCIGO for pharmaceutical preparations. The judgment essentially laid down the principle that competing marks must be seen as a whole, which in fact supports the Appellant in this case. Secondly, the dispute focussed on consumer confusion in pharmaceutical products while the enquiry under Section 11(2) is dilution and detriment to the distinctive character and repute of the trademark and shifts from consumer confusion in Section 11(1).

38. For all the aforesaid reasons, Appellant has been able to make out a case that rejection of its opposition by Respondent No.1 and direction to register the trademark ZORA is legally flawed and warrants interference. Accordingly, the impugned order dated 08.02.2024 is quashed and set aside, cancelling the registration of the mark ZORA under registration No.4310686 in Class 24. Respondent No.1 is directed to remove the entry from the Register of Trade Marks and rectify the same for the sake of purity of the Register, within two months from today.

39. Appeal stands allowed and disposed of in the aforesaid terms along with pending application.

JYOTI SINGH, J. JULY 06, 2026/YA