Darjeeling is not all about tea

While there are more than 300 registered GIs in India, we have not come across many contested litigations concerning such GIs. This is, therefore, a landmark decision concerning the first Geographical Indication (GI) in India.   

Geographical Indication is a name, geographical or figurative representation conveying or suggesting the geographical origin of products. A product marked with a certain geographical indication is unique to the particular geographical area and which originates exclusively from such area.

In such cases, the goods could be agricultural, natural or manufactured.

The Law governing GIs is laid down in The Geographical Indications of Goods (Registration and Protection) Act, 1999 (GI Act). Some of the most popular ones include Darjeeling tea, Alphonso mango, Banglar Rasogolla, Coorg Orange, Nagpur Orange, Muga Silk, Madhubani Paintings, Gadwal Sarees, Phulkari, Kancheepuram Silk and Kolhapuri Chappals. Some foreign GIs which are registered in India includes Prosecco, Scotch Whisky, Champagne and Parma Ham.

In the present case, Tea Board initiated action against ITC Limited on the basis of their registered GIs including Darjeeling.

ITC Limited has been operating a premier executive lounge by the name ‘Darjeeling Lounge’ at its ITC SONAR Hotel in Kolkata since 2003. The GI Act was enacted in India in September 2003 and soon thereafter the Tea Board filed and obtained registrations in respect of its GIs ‘Darjeeling’ and the logo. The Tea Board also held registrations over the same GIs as ‘certification trade marks’.

Tea Board issued legal notices to ITC Limited and also filed oppositions against ITC’s application for registration of the trademark Darjeeling Lounge (label) on the ground that the use of the trademark ‘Darjeeling Lounge’ infringes their registered GI and Certification Trade Marks.

Subsequently, Tea Board proceeded to file a Civil Suit in the year 2010 before the Hon’ble Calcutta High Court along with prayers for interim injunctions against ITC Limited seeking to restrain ITC Limited for using the trademark Darjeeling Lounge. They contended that the use of ‘Darjeeling’ by ITC led to infringement of their registered GIs and certification trademarks. They also pleaded that the use of ‘Darjeeling Lounge’ is an act of unfair competition and has the effect of causing confusion amongst guests visiting Darjeeling Lounge and that such guests would be falsely lead to believe that there is some association of Darjeeling Lounge with Darjeeling Tea and/ or the Tea Board. They also contended that ‘Darjeeling’ is exclusively associated with ‘Darjeeling tea’ and that the use of ‘Darjeeling’ in respect of lounge services is detrimental to the distinctive character of the Darjeeling GI held by the Tea Board. It was further argued that the use of a mark comprising ‘Darjeeling’ is dishonest and mala fide and erodes and dilutes the GI and Certification Trade Marks of the Tea Board. Tea Board also contended that the use of ‘Darjeeling’ by ITC Limited has the effect of ‘passing off’ its services as those linked to the Darjeeling GI and their Certification trade marks. To assist the Hon’ble Court, Tea Board relied upon orders obtained against third parties in other countries. 

On the other hand, ITC explained to the Court that ‘Darjeeling Lounge’ was adopted in a bonafide manner to name a part of its ITC SONAR Hotel and in line with its scheme of naming various parts of its hotel after the names of West Bengal’s well-known geographical sites and dynasties, such as ‘Pala’ banquet, ‘Bay of Bengal’ Lounge, ‘Sunderbans’ Lawns. It was also brought to the notice of the Court that registration of a GI is restricted to goods only under various provisions of the GI Act, 1999 and that the argument of Tea Board on the enforcement of their GI can be extended to other goods and services is incorrect. The Court was also made aware of the fact that the scope of Certification trade marks is restricted to the act of ‘certification’ of goods only and cannot be treated as regular trade marks. It was specifically argued that the protection afforded by GI and Certification Trade Marks cannot cross over to other goods and services, unlike regular trademarks.

The Court was further informed that the Tea Board is a statutory body which is not involved in the trading of tea, cannot claim passing off and unfair competition considering that the basic essentials of passing off and unfair competition are not satisfied.

It was also pleaded that Darjeeling primarily is the name of a place and tea is not the single most important aspect of Darjeeling. Tea Board is therefore not entitled to claim exclusivity over ‘Darjeeling’ considering that its monopoly ends at ‘tea’. Also, it was pleaded that the suit was barred by limitation since the use of ‘Darjeeling Lounge’, commenced prior to enactment of the GI Act and there was a delay in initiating the suit.

The Defendant also pleaded that the Tea Board’s success in restraining others from using ‘Darjeeling’ in other countries was irrelevant to the present proceedings considering such actions were restricted to tea and related products and not cross-category complaints and moreover the Law in other jurisdictions cannot be equated with the Indian GI Law, many countries have super-specialized GI legislation which affords special protection to certain category of products, for example, wines in the EU. However, while the Indian Act does empower the Government to enact Rules for special protection of specific GIs, no such Rules exist.

Both at the interim injunction stage before the Single Judge and on appeal before the division Bench, injunctions were denied to Tea Board considering that there was no likelihood of confusion or deception through the use of ‘Darjeeling’ as a part of a name of a lounge with Tea Board’s tea. The Court further held that the word “Darjeeling” cannot be exclusively claimed by the Plaintiff (Tea Board) by virtue of its registration as a geographical indication or as a certification trademark and therefore the claim of passing off at the interlocutory stage does not lie.

Tea Board preferred a petition before the Supreme Court of India. The Supreme Court did not go into the merits of the case at the interlocutory stage, rather, the matter was disposed of, with certain directions to the High Court. In fact, suit proceedings were directed to be expedited. Tea Board also undertook to not dispute the contentions of ITC. In essence, the matter was to be decided by the Suit Court (in Calcutta) on the question of law of GI and Certification Trade Mark only, without going into a lengthy trial and examination of documents/ witnesses.

Final Arguments went on for numerous days between November 2017 to September 2018.

The Judgement was pronounced orally by the Hon’ble Justice Sahidullah Munshi on February 2, 2018, dismissing the suit and the lawsuit was decided in favour of ITC. The Court reiterated the findings of the interlocutory Court. The Court found that the Plaintiff’s registered GI and Certification trademarks are restricted to tea and the protection afforded by the same cannot extend to lounge services. The Court further observed that the Plaintiff had failed to establish a case of passing, dilution or unfair competition. The Court specifically held that Darjeeling being the name of a place cannot function as a regular trademark, and though Darjeeling may be famous for tea, the Plaintiff is not entitled to allege that Darjeeling cannot be used by any other traders for their own goods and services for goods/ services, other than tea.

The judgement can be accessed from:

http://164.100.79.153/judis/kolkata/index.php/casestatus/viewpdf/CS_250_2010_04022019_J_236.pdf.

Members of our firm, S. Majumdar & Co., defended ITC Limited in the proceedings before the Hon’ble Calcutta High Court.

Suhrita Majumdar

With about 10 years’ experience in the field of trade marks, Ms. Majumdar advises on all aspects of trade mark laws ranging from trade mark clearance, applications, prosecution issues, oppositions, post-registration activities, cancellation actions and litigations. She is also an active member of the team working on foreign trade mark matters. She also handles domain dispute cases and enforcement actions before the Customs Office. Ms. Majumdar continues to be a part of several IP awareness programs across India. She had chaired the INTA MEASA Sub- Committee of Well-Known Trade Marks for the term 2015-2017 and is currently a part of the Trade Marks Office Practice Committee. Besides, she is a member of ECTA and APAA.

Kironjit B. Majumder

Mr. Majumder handles small to large sized trade mark portfolios for clients in sectors including but not restricted to engineering, healthcare and medical instruments, and food and beverages. With over 6 years’ experience, he advises on trade mark clearance searches, applications, prosecution and activities relating to transfer of rights. He is a part of the Copyrights and Designs team as well. He is also involved in enforcement actions and litigations, before various fora. He is a member of the INTA.

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