FAO(OS) (COMM) 146/2024 and connected matters Page 1 of 87

$~

* IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on: 19 December 2025

Pronounced on: 9 March 2026

+ FAO(OS) (COMM) 146/2024, CM APPL. 39898/2024 & CM

APPL. 39900/2024

WESTERN DIGITAL TECHNOLOGIES

INC. & ANR. .....Appellants

Through: Mr. Pravin Anand, Mr. Saif

Khan, Mr. Shobhit Agarwal, Ms. Shayal

Anand, Mr. Prajjwal Kushwaha and Ms.

Meghana Kudligi, Advs.

versus

GEONIX INTERNATIONAL PRIVATE LIMITED,

THROUGH ITS DIRECTORS, MR. GAURAV JAIN MR.

SAURABH JAIN & ANR. .....Respondents

Through: Ms. Rashi Bansal, Mr. Saurabh

Lal and Ms. Deepti Thapa, Adv.

Mr. R.V. Sinha and Mr. A.S. Singh, Advs.

for R-2 and 3.

+ FAO(OS) (COMM) 147/2024, CM APPL. 40344/2024 & CM

APPL. 40346/2024

WESTERN DIGITAL TECHNOLOGIES

INC. & ANR. .....Appellants

Through: Mr. Pravin Anand, Mr. Saif

Khan, Mr. Shobhit Agarwal, Ms. Shayal

Anand, Mr. Prajjwal Kushwaha and Ms.

Meghana Kudligi, Advs.

versus

DAICHI INTERNATIONAL & ANR. .....Respondents

FAO(OS) (COMM) 146/2024 and connected matters Page 2 of 87

Through: Ms. Rashi Bansal, Mr. Saurabh

Lal and Ms. Deepti Thapa, Adv.

+ FAO(OS) (COMM) 148/2024, CM APPL. 40350/2024 & CM

APPL. 40352/2024

WESTERN DIGITAL TECHNOLOGIES

INC & ANR. .....Appellants

Through: Mr. Pravin Anand, Mr. Saif

Khan, Mr. Shobhit Agarwal, Ms. Shayal

Anand, Mr. Prajjwal Kushwaha and Ms.

Meghana Kudligi, Advs.

versus

CONSISTENT INFOSYSTEMS PRIVATE

LIMITED & ORS. .....Respondents

Through: Mr. Dushyant K. Mahant and

Mr. Vimlesh Kumar, Advs. for R-1

Ms. Rashi Bansal, Mr. Saurabh Lal and Ms.

Deepti Thapa, Adv.

+ FAO(OS) (COMM) 151/2024, CM APPL. 40711/2024 & CM

APPL. 40713/2024

SEAGATE TECHNOLOGY LLC .....Appellant

Through: Mr. Ranjan Narula, Mr. Shakti

Priyan Nair and Mr. Parth Bajaj, Advs.

versus

CONSISTENT INFOSYSTEMS PRIVATE LIMITED AND

ANR & ANR. .....Respondents

Through: Mr. Dushyant K. Mahant and

Mr. Vimlesh Kumar, Advs. for R-1.

+ FAO(OS) (COMM) 152/2024, CM APPL. 40762/2024 & CM

APPL. 40764/2024

SEAGATE TECHNOLOGY LLC .....Appellant

FAO(OS) (COMM) 146/2024 and connected matters Page 3 of 87

Through: Mr. Ranjan Narula, Mr. Shakti

Priyan Nair and Mr. Parth Bajaj, Advs.

versus

DAICHI INTERNATIONAL .....Respondent

Through: Ms. Rashi Bansal, Mr. Saurabh

Lal and Ms. Deepti Thapa, Adv.

+ FAO(OS) (COMM) 104/2025, CAV 230/2025, CM APPL.

36440/2025 & CM APPL. 36441/2025

WESTERN DIGITAL TECHNOLOGIES,

INC. AND ANR. .....Appellants

Through: Ms. Shwetasree Majumder, Mr.

Prithvi Singh, Ms. Devyani Nath and Ms.

Vanshika Singh, Advs.

versus

HANSRAJ DUGAR .....Respondent

Through: Mr. Sidharth Chopra, Mr.

Kanishk Kumar, Mr. Angad Makkar and Mr.

Priyansh Kohli, Advs.

CORAM:

HON'BLE MR. JUSTICE C. HARI SHANKAR

HON'BLE MR. JUSTICE OM PRAKASH SHUKLA

JUDGMENT

% 09.03.2026

C. HARI SHANKAR, J.

Facilitative Index to the Judgment

S. No. Subject Para Nos

1 A The lis 1 - 3

FAO (OS) (Comm) 146/2024, FAO (OS) (Comm) 147/2024, FAO (OS)

(Comm) 148/2024, FAO (OS) (Comm) 151/2024 and FAO (OS) (Comm)

FAO(OS) (COMM) 146/2024 and connected matters Page 4 of 87

152/2024

2 B Facts 4 – 11

3 C The Issues 12 – 16

4 D Sections 29, 30(3) and 30(4) and the decision in Kapil Wadhwa

5 I Sections 29, 30(3) and 30(4) 20 – 45

6 II The decision in Kapil Wadhwa 46 – 52

7 E The Impugned Judgment

8 I Facts of the case as noted in the impugned

judgment

53 – 54

9 II Appellants’ contentions before learned Single Judge 55 – 62

10 III Respondents’ contentions before learned Single

Judge

63 – 68

11 IV Observations and findings in the impugned judgment

12 IV.1 Re. Importation and sale 70 – 72

13 IV.2 Sale to refurbisher 73

14 IV.3 Right to repair 74

15 IV.4 The aspect of infringement under the Act 75 – 78

16 IV.5 Reverse passing off 79

17 IV.6 Conclusions of learned Single Judge 80 – 81

18 F Rival Contentions before this Court 82

19 I Submissions of Mr. Pravin Anand for WD

20 II Submissions of Mr. Ranjan Narula for Seagate

21 III Submissions of Ms. Shwetasree Majumder for WD in FAO (OS)

(Comm) 104/2025

22 IV Submissions of Mr. Dushyant Mahant for Consistent

23 V Submissions of Ms. Rashi Bansal for Daichi and Geonix

24 VI Submissions of Mr. Sidharth Chopra for Hansraj Dugar

25 G Analysis

26 I Re. the pleas of “passing off” and “reverse passing off”

27 I.1 Plea of “reverse passing off” is foreign to our trade

mark jurisprudence, and does not clothe the

appellants with an enforceable cause of action

83 – 94

28 I.2 Ingredients of “passing off” and “reverse passing

off” are absent

95 – 109

29 II Re. infringement

30 II.1 Neither Section 30(3) nor Section 30(4) calls for

invocation, as no case of infringement within the

meaning of Section 29 is made out

110 – 115

31 II.2 Assuming Section 30(3) is at all invocable, its

ingredients are fully satisfied

116 – 127

32 II.3 Section 30(4) is not applicable 128 – 137

33 II.4 The sequitur 138

34 III Other submissions 139 – 142

35 IV Re. concluding directions by the learned Single

Judge

143 – 147

36 H Itemising our findings 148

FAO(OS) (COMM) 146/2024 and connected matters Page 5 of 87

37 I Conclusion 149

FAO (OS) (Comm) 104/2025

38 J Facts 150 – 155

39 K Analysis 156 – 165

40 L Conclusion 166 – 168

41 A closing remark 169

A. The lis

1. The appellants Western Digital Technologies Inc.

1

and Seagate

Technology LLC

2

manufacture Hard Disk Drives

3

, which are sold to

Original Equipment Manufacturers

4

located outside India, who

integrate these HDDs into personal computers

5

, laptops, servers and

similar equipment. The appellants provide warranty for the HDDs up

to a particular period, after which they are regarded as “end-of-life”.

An end-of-life HDD does not lose its functionality; it is only that the

manufacturer of the HDD does not provide any further warranty. The

HDDs are extracted from the equipment in which they were integrated

and imported into India.

2. These appeals fall into two categories. The respondents in FAO

(OS) (Comm) 146/2024 (Geonix International Pvt Ltd

6

), FAO (OS)

(Comm) 147/2024 (Daichi International

7

) and FAO (OS) (Comm)

148/2024 (Consistent Infosystems Pvt Ltd) purchase the HDDs after

they are removed from the equipment abroad and imported into India

1

“WD" hereinafter

2

"Seagate" hereinafter

3

“HDDs” hereinafter

4

"OEMs" hereinafter

5

"PCs" hereinafter

6

“Geonix” hereinafter

7

“Daichi” hereinafter

FAO(OS) (COMM) 146/2024 and connected matters Page 6 of 87

whereas Hansraj Dugar, the respondent in FAO (OS) (Comm)

104/2025, himself imports the HDDs into India, after they are

removed from the equipment abroad.

3. We will also deal with these matters separately.

FAO (OS) (Comm) 146/2024, FAO (OS) (Comm) 147/2024, FAO

(OS) (Comm) 148/2024, FAO (OS) (Comm) 151/2024 and FAO

(OS) (Comm) 152/2024

B. Facts

4. WD and Seagate, the appellants in these appeals, manufacture

HDDs and sell them to OEMs located in China. The HDDs bear the

appellants’ trade marks, registered under Section 23 of the Trade

Marks Act, 1999

8

. Once the HDDs reach “end of life” stage, the

warranty provided by WD and Seagate comes to an end, the

equipment in which the HDDs were installed is discarded, the HDDs

are extracted therefrom, and imported into India.

5. At the time of import, or of subsequent sale in India, the HDDs

bear the registered trade marks of the original manufacturers, i.e. the

appellants. The respondents examine the HDDs and subject them to

testing. Defective HDDs are returned by the respondents to the

suppliers from whom they were purchased. The appellants’ trade

marks are removed from the remaining, functional HDDs. The

respondents affix their own trade marks/brand names on the HDDs.

8

“the Act” hereinafter

FAO(OS) (COMM) 146/2024 and connected matters Page 7 of 87

The software embedded in the HDDs is erased. New software is

loaded on the HDDs by the respondents. New Serial numbers and

Model numbers are affixed on the HDDs. The respondents claim to

refurbish the HDDs and, thereby, enhance their utility. The HDDs are

thereafter sold by the respondents in their own individual packings

under the newly assigned Serial numbers and Model numbers.

6. The respondents claim that this is perfectly legitimate, and

forms the basis of a thriving refurbishing industry. They also claim

that the Government is promoting the industry, though we do not

propose to enter into that arena. The respondents claim that, by their

acts, HDDs, which retain functionality but have been discarded, are

rendered functional and useful, and made available to persons who

may not be able to afford original prime quality HDDs. In a sense of

speaking, they, therefore, claim to breathe life into the HDDs which

had been abandoned as “end of life”. The respondents claim that their

acts are perfectly legitimate, and do not breach any law in force.

7. The appellants, on the other hand allege that, by their acts, the

respondents are simultaneously committing three intellectual property

torts. They are infringing the appellants’ registered trade marks, and

committing the torts of passing off, as well as “reverse passing off”.

8. Predicated on these allegations, the appellants instituted the

suits from which the present appeals emanate, against the respondents,

seeking decrees of permanent injunction restraining them from

altering, impairing, repacking, rebranding or performing any similar

FAO(OS) (COMM) 146/2024 and connected matters Page 8 of 87

activity on the HDDs originally manufactured and sold by the

appellants, as would amount to infringement or passing off.

9. The appellants filed, with their suits, applications under Order

XXXIX of the Code of Civil Procedure, 1908

9

, seeking interlocutory

injunctions, restraining the respondents from performing the afore

noted activities, pending disposal of the suits.

10. A learned Single Judge of this Court, by judgment dated 21

May 2024, disposed of the Order XXXIX applications filed by the

appellants with the following directions:

“The defendants will be permitted to sell the refurbished HDDs,

provided they comply with the following:

(i) Packaging to identify the source of the product:

Packaging in which the refurbished product is sold, will

clearly indicate that the HDD is manufactured by the

plaintiffs concerned (Seagate or WD as the case may be).

This may be displayed in a manner not to deceive the

customer that the sale itself is of the original Seagate or WD

i.e. it should be clear, but not dominating the packaging.

(ii) Reference to the original manufacturer is to be

made through their word mark and not the device mark:

Reference to the plaintiffs should be through their word

marks as in “Seagate” or “WD”, as the case may be.

Defendant shall not use plaintiffs' logos, in order to not

cause any deception to the consumer.

(iii) Packaging must specify that there is no original

manufacturer's warranty: A clear statement must be made

to the effect that there is no manufacturers' warranty or

service by (Seagate or WD, as the case may be) on this

product.

9

"CPC" hereinafter

FAO(OS) (COMM) 146/2024 and connected matters Page 9 of 87

(iv) Packaging must specify that the product is “used

and refurbished”: A prominent statement on the front of

packaging to the effect that the product is “used and

refurbished” by the defendants concerned (Consistent or

Geonix or Daichi, as the case may be).

(v) Statement as to extended warranty by the

refurbisher: A clear and prominent message that the

warranty or service of specified years is being provided by

the defendants concerned (Consistent or Geonix or Daichi,

as the case may be), along with customer care details and

contacts.

(vi) Packaging must reflect an accurate description of

the features: An accurate, truthful, precise description of

features and purpose of the refurbished product, without

any misleading, half-truth, deceptive, ambiguous statements

(which could potentially misinform the consumer as to the

features of the product and the purposes for which it could

be used).

(vii) All of the above should also be complied with by

the defendants on promotional literature, website, e-

commerce listings, brochures and manuals.”

(Emphasis as in original)

11. WD and Seagate are in appeal against the said judgments. The

defendants before the learned Single Judge have not chosen to appeal.

C. The Issues

12. The appellants allege, against the respondents, infringement and

“reverse passing off”. The allegation of infringement is predicated on

Sections 29(1) and (2)

10

, read with Section 29(6)(c)

11

and Sections

10

29. Infringement of registered trade marks. –

(1) A registered trade mark is infringed by a person who, not being a registered proprietor or

a person using by way of permitted use, uses in the course of trade, a mark which is identical with,

or deceptively similar to, the trade mark in relation to goods or services in respect of which the

trade mark is registered and in such manner as to render the use of the mark likely to be taken as

being used as a trade mark.

FAO(OS) (COMM) 146/2024 and connected matters Page 10 of 87

30(3) and 30(4)

12

of the Act, whereas the allegation of “reverse

passing off” is, at least in so far as the law in this country is

concerned, in a sense sui generis.

13. In the context of the refurbishment trade, with which we are

concerned, there does not appear to be any earlier authority on the

point. The learned Single Judge, in the judgment under challenge in

the present appeals, has stated that the territory is virgin, and that he

had, before him, therefore, a “veritable tabula rasa”. We are much in

the same position, the only words written on the tabula being those

contained in the impugned judgments.

14. The only issues to be addressed are, therefore, whether the

respondents have infringed the registered trade marks of the

appellants, or are guilty of passing off, or reverse passing off.

(2) A registered trade mark is infringed by a person who, not being a registered proprietor or

a person using by way of permitted use, uses in the course of trade, a mark which because of—

(a) its identity with the registered trade mark and the similarity of the goods or

services covered by such registered trade mark; or

(b) its similarity to the registered trade mark and the identity or similarity of the

goods or services covered by such registered trade mark; or

(c) its identity with the registered trade mark and the identity of the goods or

services covered by such registered trade mark,

is likely to cause confusion on the part of the public, or which is likely to have an association with

the registered trade mark.

11

(6) For the purposes of this section, a person uses a registered mark, if, in particular, he—

*****

(c) imports or exports goods under the mark;

12

(3) Where the goods bearing a registered trade mark are lawfully acquired by a person, the sale of the

goods in the market or otherwise dealing in those goods by that person or by a person claiming under or

through him is not infringement of a trade by reason only of –

(a) the registered trade mark having been assigned by the registered proprietor to some other

person, after the acquisition of those goods; or

(b) the goods having been put on the market under the registered trade mark by the proprietor

or with his consent.

(4) Sub-section (3) shall not apply where there exists legitimate reasons for the proprietor to oppose

further dealings in the goods in particular, where the condition of the goods, has been changed or impaired

after they have been put on the market.

FAO(OS) (COMM) 146/2024 and connected matters Page 11 of 87

15. We are dealing with these aspects in appellate jurisdiction over

a judgment rendered by the learned Single Judge under Order XXXIX

of the CPC. The analysis is, therefore, merely prima facie. Equally,

we would remain guided by the decisions in Wander Ltd v. Antox

(India) Pvt Ltd

13

and Pernod Ricard India Pvt Ltd v. Karanveer

Singh Chhabra

14

, which hold that an appeal against an interlocutory

Order XXXIX order is merely an appeal on principle, and the

appellate Court would not substitute its subjective opinion for the

opinion of the Commercial Court.

16. We have heard Mr. Pravin Anand for WD, Mr. Ranjan Narula

for Seagate, Mr. Dushyant Mahant for Consistent and Ms. Rashi

Bansal for Daichi and Geonix.

D. Sections 29, 30(3) and 30(4) and the decision in Kapil

Wadhwa

17. These appeals necessitate an intricate navigation through

Sections 29, 30(3) and 30(4) of the Act, and we propose to undertake

the exercise at the very outset, so that the legal boundaries, within

which we would be require to limit our excursions, are clearly drawn.

18. As would become apparent during the course of this judgment,

the challenge relating to infringement, as levelled by the appellants

and predicated on Sections 30(3) and 30(4) of the Act, is more

substantial than the plea of “reverse passing off”. In so far as Sections

13

1990 (Supp) SCC 727

14

2025 SCC OnLine SC 1701

FAO(OS) (COMM) 146/2024 and connected matters Page 12 of 87

30(3) and 30(4) are concerned, there is no authority, except the

impugned judgment of the learned Single Judge, which deals with

these provisions in the context of refurbishment. The only decision on

the point appears to be the judgment of a Division Bench of this Court

in Kapil Wadhwa v. Samsung Electronics Co.

15

, which, though it does

not deal with refurbishment, intricately analyses Sections 30(3) and

30(4).

19. We, therefore, proceed to set out our understanding of Sections

30(3) and (4), and the judgment of the Division Bench in Kapil

Wadhwa.

I. Sections 29, 30(3) and (4)

20. Section 30(3) applies where goods bearing a registered trade

mark are lawfully acquired by a person, who thereafter sells or

otherwise deals in the said goods. We will call him Mr. X.

21. The words that follow are crucial. They postulate that the sale

or otherwise dealing, by Mr. X, in the said goods, is not infringement,

by reason only of the existence of one or other of the two

circumstances envisaged in clauses (a) and (b) which follow.

22. Clearly, therefore, Section 30(3) does not create a distinct

specie of infringement. It sets out certain circumstances in which the

act envisaged in the provision would not be infringement.

15

2012 SCC OnLine Del 5172

FAO(OS) (COMM) 146/2024 and connected matters Page 13 of 87

23. This implies that, if Section 30(3) were not to apply, the act

would be infringement. Section 30(3), therefore, provides an escape

route, from the taint of infringement, of an act which, but for Section

30(3), would otherwise be infringement.

24. This is clear even from the title of Section 30, which reads

“Limits on effect of registered trade mark”. Thus, the various sub-

sections of Section 30 must be read as incorporating limits, on the

effects of registration. Section 30(3) cannot, therefore, be understood

as providing one more avenue for alleging infringement, consequent

to registration of a trade mark. Rather, it incorporates limits on the

right to assert or allege infringement, where a registered trade mark is

lawfully acquired by the person who sells the goods, bearing the mark,

in the market, in the circumstances envisaged in clauses (a) and (b) of

the sub-Section.

25. The only provision in the Act which envisages what

“infringement” would be, and which is a self-contained code in that

regard, is Section 29. If an act satisfies one or more of the sub-sections

of Section 29, it would amount to infringement. Else, it would not.

There is no other provision, in the Act, which deems any act to

amount to infringement.

26. Section 30(3), therefore, merely clarifies that, even if an act

amounts to infringement under Section 29, it would nonetheless not be

infringement if the circumstances in Section 30(3) apply. If an act

FAO(OS) (COMM) 146/2024 and connected matters Page 14 of 87

does not amount to infringement within the meaning of Section 29,

therefore, in the very first instance, no occasion to refer to Section

30(3) would arise at all. This is one of the contentions of Mr.

Dushyant Mahant, and we entirely agree with him.

27. Section 30(4) excepts the applicability of Section 30(3) in

certain circumstances. This does not mean that the act would, then,

ipso facto amount to infringement, as Mr. Pravin Anand would seek to

contend. It merely means that, if the circumstances of Section 30(4)

apply, the escape clause, otherwise available under Section 30(3) to

acts which are infringing within the meaning of Section 29, would no

longer be available. The act would, nonetheless, have to be infringing,

within the meaning of Section 29, in the first instance.

28. If, therefore, an act does not amount to infringement within the

meaning of Section 29, the matter must rest there. No further enquiry,

into whether there is, or is not, infringement, is warranted. If,

however, the act is otherwise infringing within the meaning of Section

29, and the circumstances envisaged in Section 30 apply, i.e., the

infringing goods are lawfully acquired by a person and sold in the

market, then such acquisition and sale would not amount to

infringement if condition (a) or (b) in Section 30(3) applies.

29. That is how, in our view, Sections 29, 30(3) and 30(4) are to be

understood.

FAO(OS) (COMM) 146/2024 and connected matters Page 15 of 87

30. Here, we may note that the words “by reason only of”, in

Section 30(3), are confusing. If they are to be assigned their ordinary

grammatical and syntactical meaning, the provision would make no

sense. The plain grammatical connotation of the provision is that, if

the preceding conditions are satisfied, then the sale or dealing of the

goods by Mr. X would not be infringement only because of

circumstance (a) or circumstance (b).

31. But then, circumstance (b) refers to the goods having been put

on the market by the proprietor or with his consent. If the person who

deals in the trade marked goods is the proprietor of the mark, or deals

in the mark with the consent of the proprietor and is, therefore, a

permissive user, the use would, in any case, not be infringement

within the meaning of Section 29, as “infringement”, in each of the

clauses of Section 29, can be committed only by one who is not the

registered proprietor, or the permissive user, of the infringing mark.

32. As such, there would be no sense in specifying that the sale or

dealing of the goods by Mr. X would not be infringement by reason

only of a circumstance which, in any case, would not be infringement

per se.

33. Circumstances (a) and (b) have, therefore, if they are to be

accorded any meaning, to be understood as the circumstances which,

if they apply, would result in the sale or otherwise dealing in the

goods, by Mr. X, not being infringing in character, i.e. not result in

FAO(OS) (COMM) 146/2024 and connected matters Page 16 of 87

infringement, assuming the indicia of infringement, as contained in

Section 29, otherwise apply.

34. Circumstance (a) applies where, after Mr. X has acquired the

goods, the proprietor of the trade mark assigns it to someone else.

That circumstance does not apply in the appeals before us.

35. Circumstance (b) applies where the proprietor of the trade mark

has himself put the goods on the market, or consented to their being

put on the market.

36. In other words, if goods bearing a registered trade mark are put

on the market by the registered proprietor of the mark, or with his

consent, then the sale, or dealing, in such goods, by Mr. X, would not

result in infringement.

37. By putting them on the market, or consenting to their being put

on the market, the registered proprietor of the mark has thus exhausted

his right to allege that the sale, or dealing, in the goods, by a person

who lawfully acquires them, results in infringement.

38. If, however, the goods in which Mr. X deals does not bear the

registered trade mark of the original manufacturer (as in the present

appeals), such dealing would not, in any event, amount to

infringement under Section 29, as Section 29, in each of its clauses,

requires the infringer to use the infringed trade mark, or a trade mark

which is deceptively similar thereto, in the course of trade. If the act

FAO(OS) (COMM) 146/2024 and connected matters Page 17 of 87

is not infringing under Section 29, there can be no question of

referring to Section 30(3) or 30(4).

39. We may nonetheless examine Section 30(4) as well.

40. Section 30(4) provides that, if there exist legitimate reasons for

the proprietor of the mark to oppose further dealings in the goods, in

particular where the condition of the goods has been changed or

impaired after they have been put on the market, then, even if

circumstance (a), or (b), or both, in Section 30(3) apply, the sale of, or

otherwise dealing in, the goods, by Mr. X, would amount to

infringement.

41. The use of the contrasting expressions “on the market” and “in

the market” in Sections 30(3) and (4), in their respective contexts,

makes it clear that the putting of the goods “on the market” is by the

registered proprietor of the mark, whereas the “sale of the goods in the

market” is by the person who has lawfully acquired them. This

interpretation stands endorsed by Kapil Wadhwa.

42. In a case in which the act of the subsequent acquirer of the

goods would otherwise amount to infringement within the meaning of

Section 29, the subsequent sale of, or otherwise dealing in, the goods,

by the acquirer, would not amount to infringement, if the following

conditions are cumulatively satisfied:

FAO(OS) (COMM) 146/2024 and connected matters Page 18 of 87

(i) The goods must have been lawfully acquired by the

acquirer.

(ii) The goods must have been put on the market by the

registered proprietor of the mark, of with his consent.

(iii) The condition of the goods should not have been changed

or impaired after they were put on the market by the registered

proprietor of the mark.

43. The interpretation that would require to be imparted to the word

“changed” in Section 30(4) is also of significance. “Changed”, in its

widest etymological sense, would include any change, positive or

negative, substantial or frugal. As used in Section 30(4), however,

that meaning cannot be attributed to the word “changed”, as the

change, or impairment, must constitute a legitimate reason for the

proprietor of the mark to oppose the sale of the goods. If the change

is resulting in making non-functional goods functional, or useless

goods useful, without any prejudice to the registered proprietor of the

trade mark, it cannot, quite obviously, constitute a legitimate reason to

oppose the dissemination of the goods in the market. Equally, if the

lawful acquirer of the goods, who sells them in the market, affixes his

mark on them, that, too, cannot constitute a legitimate reason for the

registered proprietor of the mark to oppose their sale or dissemination.

The word “change”, therefore, must result in something negative

resulting; in other words, the word “changed” must be read noscitur a

sociis with the word “impaired”. They must partake of a like character.

FAO(OS) (COMM) 146/2024 and connected matters Page 19 of 87

44. The noscitur a sociis principle is as old as the hills, and is a

hallowed principle of interpretation of statutes, predicated on the

principle that words, in a statue, take colour from the company they

keep. As far back as in Angus Robertson v. George Day

16

, the Privy

Council observed that it was “a legitimate rule of construction to

construe words in an Act of Parliament with reference to words found

in immediate connection with them”. A subset of the noscitur a sociis

principle is the ejusdem generis doctrine, which applies where there

are a number of expressions used together, which may be said to

constitute a genus, in which case each of the said expressions is to be

so interpreted as to be part of the genus. The ejusdem generis doctrine

has, however, no application in a case in which there are only two

words keeping company with each other as, just as one swallow

cannot make a summer, one word cannot make a genus. In such a

case, therefore, it is the noscitur a sociis principle which applies.

45. The application of the principle is, of course, subject to the

statute itself not indicating to the contrary. Here, the opening words of

Section 30(4) would eminently support interpreting the word

“changed”, as used later in the provision, noscitur a sociis with the

word “impaired”.

II. The decision in Kapil Wadhwa

16

(1879) 5 AC 63, referenced in M.K. Ranganathan v. Govt. of Madras, AIR 1955 SC 604 and

Ahmedabad Primary Private Teachers Assn v. Administrative Officer, (2004) 1 SCC 755

FAO(OS) (COMM) 146/2024 and connected matters Page 20 of 87

46. Kapil Wadhwa, it has to be noted at the very outset, is a case in

which the issue which confronts us did not confront the Court, for the

simple reason that Kapil Wadhwa imported, and dealt with the goods

manufactured by Samsung under the Samsung trade mark itself. The

applicability of Section 29, therefore, could not be questioned.

47. Samsung, the respondent before this Court, claimed to be

aggrieved by the fact that the appellants, Kapil Wadhwa and others,

were purchasing Samsung printers from the foreign market, importing

them into India and selling them in India under the trademark

SAMSUNG. This, according to Samsung, infringed its registered

trademarks. The appellants’ activities also resulted in consumers being

misled into believing that the printers being purchased by them were

authorised and sold in India with the permission of Samsung. The

appellants, on the other hand, contended that they were committing no

illegality and that their activities resulted in Samsung’s printers being

available to the consumer public at a cheaper rate. This Court,

therefore, clearly noted, in para 3 of its judgment, that it was dealing

with “parallel imports/grey market goods”. This Court also noted, in

para 8, that it was only examining the dispute from the infringement

angle, as no passing off had been pleaded.

48. Though the dispute in Kapil Wadhwa was qualitatively

somewhat different from that which is before us, the Division Bench

embarked on a detailed analysis of Section 30(3) and 30(4) of the Act.

The learned Single Judge deemed it appropriate to extract paras 42

and 68 to 75 of Kapil Wadhwa, and we do likewise:

FAO(OS) (COMM) 146/2024 and connected matters Page 21 of 87

“42. There is a patent fallacy in paragraph 68(c). There is no law

which stipulates that goods sold under a trade mark can be lawfully

acquired only in the country where the trade mark is registered. In

fact, the legal position is to the contrary. Lawful acquisition of

goods would mean the lawful acquisition thereof as per the laws of

that country pertaining to sale and purchase of goods. Trade Mark

Law is not to regulate the sale and purchase of goods. It is to

control the use of registered trade marks. Say for example, there is

food scarcity in a country and the sale of wheat is banned except

through a canalizing agency. Lawful acquisition of wheat in that

country can only be through the canalizing agency. The learned

Single Judge has himself recognized that the law of trade marks

recognizes the principle of international exhaustion of rights to

control further trade of the goods put on the market under the trade

mark. The task of the learned Single Judge thus was to resolve the

impasse in the Indian Law, and thus the presumption/assumption in

paragraph 68(c) could not be the point to resolve the textual

context in which the learned Single Judge has discussed in

paragraph 68(d).

*****

68. With reference to sub-section 4 of Section 30 of the Trade

Marks Act 1999 it would be relevant to note that further dealing in

the goods placed in the market under a trade mark can be opposed

where legitimate reasons exist to oppose further dealing and in

particular where the condition of the goods has been changed or

impaired. With respect to physical condition being changed or

impaired, even in the absence of a statutory provision, the

registered proprietor of a trade mark would have the right to

oppose further dealing in those goods inasmuch as they would be

the same goods improperly so called, or to put it differently, if a

physical condition of goods is changed, it would no longer be the

same goods. But, sub-section 4 of Section 30 is not restricted to

only when the conditions of the goods has been changed or

impaired after they have been put on the market. The section

embraces all legitimate reasons to oppose further dealings in the

goods. Thus, changing condition or impairment is only a specie of

the genus legitimate reasons, which genus embraces other species

as well. What are these species? (i) Difference in services and

warranties as held in the decisions reported as SKF

USA v. International Trade Commission

17

; Fender Musical

Instruments Corp. v. Unlimited Music Center Inc.

18

; Osawa &

17

423 F.3d 1037 (2005)

18

35 USPQ2d 1053 (1995)

FAO(OS) (COMM) 146/2024 and connected matters Page 22 of 87

Co. v. B&H Photo

19

. (ii) Difference in advertising and promotional

efforts as held in the decisions reported as Pepsi Co.

Inc. v. Reyes

20

; Osawa & Co. v. B&H Photo. (iii) Differences in

packaging as held in the decision reported as Ferrerro

USA v. Ozak Trading

21

. (iv) Differences in quality control, pricing

and presentation as held in the decision reported as Societe Des

Produits Nestle v. Casa Helvetia

22

. (v) Differences in language of

the literature provided with the product as held in the decisions

reported as SKF USA v. International Trade Commission

23

; Pepsi

Co. Inc. v. Reyes

24

; Original Appalachian Artworks

Inc. v. Granada Electronics Inc

25

.

69. Now, as we see it, this can only happen in case where goods

have to be imported from a country of manufacture or a country

where they are put on the market thereof, and then imported into

India. Only then would there be a difference in the language of the

literature provided with the product; difference in services and

warranties in the country from where the goods are imported by the

seller and the country of import i.e. the manufacturer's warranties

not being available in the country of import; difference in quality

control, pricing and presentation as also differences in advertising

and promotional efforts.

70. This is also an indication of India adopting the Principle of

International Exhaustion of Rights in the field of the Trade Mark

Law.

71. We accordingly conclude that ‘the market’ contemplated

by Section 30(3) of the Trade Marks Act 1999 is the international

market i.e. that the legislation in India adopts the Principle of

International Exhaustion of Rights.

72. That leaves the last submission of the respondents, that in

view of Section 30(4) they are entitled to oppose further dealings

by importers of their printers to India.

73. It is not the case of the respondents that the appellants are

changing the condition of the goods or impairing the goods which

are put in the foreign market by respondent No. 1 or its subsidiary

companies abroad. What is pleaded is that the physical features of

the printers sold abroad are different from the features of the

19

589 F. Supp. 1163 (1984)

20

70 F. Supp 2d 1057

21

753 F. Supp. 1240 (1991)

22

982 F.2d 633 (1992)

23

423 F.3d 1037 (2005)

24

70F. Supp 2d 1057

25

816 F.2d 68, 76 (2

nd

Cir. 1987)

FAO(OS) (COMM) 146/2024 and connected matters Page 23 of 87

printers sold in India. But this is irrelevant as long as the goods

placed in the International market are not impaired or condition

changed. It is pleaded that the respondents have no control

pertaining to the sale, distribution and after sales services of its

goods which are imported by the appellants and sold in India. Now,

the Principle of International Exhaustion of Rights itself takes

away the right of the respondents to control the further sale and

further distribution of the goods. With respect to after sales

services, since the respondents do not warranty anything regarding

their goods sold abroad, but imported into India and further sold,

they not being responsible for the warranty of those goods, nothing

turns thereon, as regards said plea. There may be some merit that

the ordinary consumer, who is provided with warranties and after

sales by the appellants, on not receiving satisfactory after sales

service, may form a bad impression of the product of the

respondents and thus to said extent one may recognize a possible

damage to the reputation of the respondents pertaining to

Samsung/SAMSUNG printers and Samsung/SAMSUNG products

sold in India after importation. But, this can be taken care of by

passing suitable directions requiring the appellants to prominently

display in their shop that the Samsung/SAMSUNG printers sold by

them are imported by the appellants and that after sales services

and warranties are not guaranteed nor are they provided under the

authority and control of the respondents and that the appellants do

so at their own end and with their own efforts. This would obviate

any consumer dissatisfaction adversely affecting the reputation of

the respondents, and thus if this is done, the respondents can claim

no legitimate reasons to oppose further dealing in

Samsung/SAMSUNG products in India.

74. As regards the appellants meta-tagging their websites with

those of the respondents, the learned Single Judge has correctly

injuncted the appellants from so doing, which injunction we affirm.

The argument by the appellants that how else would the appellants

know about the working of the particular product hardly impresses

us for the reason the appellants can design their website in a

manner where they are able, on their own strength, without any

meta-tagging, to display the relevant information.

75. The appeal is partially allowed. Impugned judgment and

order dated February 17, 2012 is set aside insofar the appellants

have been restrained from importing printers, ink cartridges/toners

bearing the trade mark Samsung/SAMSUNG and selling the same

in India. The appellants shall continue to remain injuncted from

meta-tagging their website to that of the respondents. But, while

effecting sale of Samsung/SAMSUNG printers and ink

cartridges/toners, the respondents shall prominently display in their

FAO(OS) (COMM) 146/2024 and connected matters Page 24 of 87

showrooms that the product sold by them have been imported from

abroad and that the respondents do not give any warranty qua the

goods nor provide any after sales service and that the warranty and

after sales service is provided by the appellants personally. The

appellants would prominently display in their showrooms:

Samsung/SAMSUNG Products sold are imported into India

and SAMSUNG (KOREA) does not warranty the quality

of the goods nor provides any after sales service for the

goods. We warranty the quality of the goods and shall

provide after sales service for the goods.”

(Italics supplied)

49. The Division Bench has, in the above passages, held that (i)

“lawful acquisition”, as employed in Section 30(3), implies lawful

acquisition in the country where the goods are acquired, and not

necessarily lawful acquisition in the country in which the trademark is

registered, (ii) Section 30(4) would cover all circumstances in which

the proprietor of the registered trademark would have a legitimate

reason to oppose further dealing in the goods, and not merely a

situation in which the condition of the goods has been changed or

impaired after they were put on the market by him, (iii) if the physical

condition is changed or impaired, the registered proprietor would have

a right to oppose further dealing in the goods, as they would no longer

be the same goods as had been put on the market by him, (iv) other

“legitimate reasons” which could justify opposition, by the owner of

the trademark, to further dealing in the goods, could be where the

dealer provides different services or warranties, there is difference in

advertising and promotional efforts, difference in packaging,

difference in quality control, pricing and presentation or difference in

the literature provided with the product, (v) these provisions amount

to adoption, by the legislature in India, of the principle of International

FAO(OS) (COMM) 146/2024 and connected matters Page 25 of 87

exhaustion of rights, and (vi) the “market” in Section 30(3) is,

therefore, the international market.

50. We have no difficulty in endorsing these observations and

findings of the Division Bench in Kapil Wadhwa, except for the

identification, in para 68 of the report, of diverse circumstances in

which the registered proprietor of the trade mark could have legitimate

reasons to oppose further dealings in the goods. We are of the view

that these “species”, as identified by the Division Bench may not

constitute absolute grounds on which such legitimate reasons could be

said to exist, to oppose further dealing in the goods. To our mind, the

circumstance must be such as would reduce the quality or value of the

goods, or impair the goodwill of the registered proprietor of the trade

mark. For example, the mere fact that the goods may be sold under

different warranties or services may not, by itself, constitute a

legitimate reason to oppose further dealing in the goods. At the end of

the day, the determination of whether the registered proprietor of the

trade mark had, or did not have, a legitimate reason to oppose further

dealing in the goods, within the meaning of Section 30(4) of the Act,

would be largely one of fact.

51. In fact, it appears that the Division Bench, after purporting to

identify indicative circumstances in which the registered proprietor of

the trademark could have a legitimate reason to oppose further

dealings in the goods, did not itself treat these circumstances as

watertight. This is apparent from para 73 of the report in which the

Division Bench held that the fact that the printers sold by Samsung

FAO(OS) (COMM) 146/2024 and connected matters Page 26 of 87

abroad were different from those of the printers sold in India was

irrelevant, so long as the goods, which were placed on the

international market by Samsung, were not impaired or their condition

changed.

52. In any event, the provisions of Section 30(3) and (4) are, to our

mind, sufficiently clear, and are by themselves enough for us to deal

with the controversy in issue, without having to navigate as nautical a

course as the Division Bench in Kapil Wadhwa chose to chart.

E. The impugned judgment

I. Facts of the case as noted in the impugned judgment

53. WD and Seagate were the plaintiffs before the learned Single

Judge, and Daiichi, Consistent, Geonix and Cubicor were the

defendants. WD and Seagate manufactured HDDs, which was

supplied to OEMs, located in China and Singapore, for installation as

part of the desktops, laptops, servers and other similar goods sold by

them. These HDDs were unserviceable by the appellants, after the

prescribed lifespan. After that time, they were regarded as “end of

life” products, though they retained their functionality and utility. By

referring to them as “end of life”, what was apparently sought to be

conveyed was that the warranty provided by the original

manufacturers, i.e. the appellants, would no longer apply.

FAO(OS) (COMM) 146/2024 and connected matters Page 27 of 87

54. The HDDs which had thus become “end of life” were thereafter

extracted from the equipment in which they were installed/integrated,

and sold. These HDDs were, in the same condition, imported into

India, where they were sold to refurbishers. The refurbishers tested the

HDDs to satisfy themselves regarding their functionality. Defective

HDDs were returned to the suppliers. The HDDs which retained

functionality were refurbished after effacing the original trademark of

the appellants, and sold in the market. Before doing this, the

refurbishers claim to have, by refurbishing the HDDs, enhanced their

utility. None of the indicia of the appellants remained on the HDDs

when they were sold by the respondents after refurbishing. The

respondents affixed their own brand on the HDDs, with a new Serial

number and Model number.

II. Appellants’ contentions before learned Single Judge

55. Before the learned Single Judge, the appellants contended that

the acts of the respondents amounted to infringement within the

meaning of Section 30(4) of the Act and that the respondents were

also indulging in “reverse passing off”. “Reverse passing off”, it was

submitted, took place where the defendant removed the registered

trade mark of the plaintiff so as to pass off the goods as those of the

defendant, but the goods continued to retain features and indicia which

enabled the consumer to identify them as originating from the

plaintiff.

FAO(OS) (COMM) 146/2024 and connected matters Page 28 of 87

56. Apropos the aspect of infringement, relatable to Section 30(3)

and (4) of the Act, the appellants contended that the very removal of

their registered trademark from the HDDs amounted to “impairment”

within the meaning of Section 30(4). It was further contended that the

respondents could not seek sanctuary under Section 30(3), as the

HDDs had not been “lawfully acquired”, and were “sold in the market

or otherwise dealt with”. Even if it were to be presumed that the

HDDs had been lawfully acquired, the appellants contended, before

the learned Single Judge, that, as their condition had been changed,

and they had been impaired before they were put on the market,

infringement, within the meaning of Section 30(4), had taken place.

57. On the aspect of infringement, the learned Single Judge has

noted the issue arising before him, in para 7 of the impugned

judgment, as “of refurbished goods being sold after removal of the

original brand, with no reference to the original manufacturers,

thereby severing the umbilical cord with the original registered trade

mark owner; and whether in this situation an action for infringement

or impairment could be considered.”

58. The learned Single Judge queried, of learned Counsel for the

appellants, as to whether there was any proscription on import of

second-hand goods for refurbishing. The appellants relied on para

2.31 of the Foreign Trade Policy

26

2023, which permitted import of

second-hand goods for the purpose of

repair/refurbishing/reconditioning or re-engineering free of duty,

26

"the FTP" hereinafter

FAO(OS) (COMM) 146/2024 and connected matters Page 29 of 87

“subject to condition that waste generated during the

repair/refurbishing of imported items is treated as per domestic

Laws/Rules/Orders/Regulations/technical specifications/

Environmental/safety and health norms and the imported item is re-

exported back as per the Customs Notification”. It does not appear,

however, from the impugned judgment, that the Customs Notification,

to which para 2.31 refers, was cited by any of the learned Counsel.

Learned Counsel submitted, however, that any item imported for

refurbishment was required to be re-exported thereafter, and that

Sections 30(3) and (4) of the Act had to be read conjointly with the

FTP.

59. It was further contended, by the appellants, that import of goods

bearing a registered trademark amounted to “use” of the registered

trademark within the meaning of Section 29, in view of sub-section

(6)(c) thereof.

60. The appellants further contended that the principle of

international exhaustion, tellingly emphasised in Kapil Wadhwa and

statutorily contained in Section 30(3) of the Act, would not apply, as

purchase of the HDDs which had been removed from discarded

computers and servers could not be treated as “legal acquisition”

thereof. It was specifically contended that removing of the original

labels and trade marks of the registered proprietor, refurbishing,

reformatting and removing of the literature originally provided by the

appellants amounted to impairment as well as material change in the

condition of the goods, resulting in infringement.

FAO(OS) (COMM) 146/2024 and connected matters Page 30 of 87

61. The appellants further contended that the respondents were

misrepresenting the discarded and used HDDs as new and unused, and

were selling them under their own brand names. This amounted to

passing off of old and used HDDs as unused.

62. It was also submitted that the respondents were guilty of

“reverse passing off”, as the HDDs had distinct shapes, colours and

other indicia on the basis of which, even after removal of the label

bearing the original registered trademark of the appellants, the

consumer, who would be assumed to be a person who was conscious

of such goods, would be able to identify them as having been

manufactured by the appellants. For example, WD contended that it

used a distinctive silver plate on the HDDs, which was easily

identifiable by the consumer, who would be a technically literate

person. In support of the plea of reverse passing off, the appellants

relied on the judgment of a Division Bench of this Court in Shree

Nath Heritage Liquor Pvt Ltd v. Allied Blenders & Distillers Pvt

Ltd

27

and on the decision in Smith v. Montoro

28

. In any event,

submitted WD before the learned Single Judge, reselling the product

under the respondents’ brand names amounted to a “false trade

description” which was independently actionable under Section 103

29

read with Sections 2(i) and 2(1)(za) of the Act.

27

2015 SCC OnLine Del 10164

28

648 F. 2d. 602 (1981)

29

103. Penalty for applying false trade marks, trade descriptions, etc. – Any person who –

(a) falsifies any trade mark; or

(b) falsely applies to goods or services any trade mark; or

(c) makes, disposes of, or has in his possession, any die, block, machine, plate or other

instrument for the purpose of falsifying or of being used for falsifying, a trade mark; or

(d) applies any false trade description to goods or services; or

FAO(OS) (COMM) 146/2024 and connected matters Page 31 of 87

III. Respondents’ contentions before learned Single Judge

63. The respondents contended, per contra, that the HDDs had been

lawfully procured by them. They were not the importers of HDDs, but

were refurbishers, who had purchased the imported HDDs from the

importers under legitimate sale invoices on which GST

30

was also

paid. The invoices were also placed on record, along with affidavits of

the respondents. The appellants had not been able to produce any

material to indicate that, in their contracts with the OEMs, there was

any restriction on resale of the HDDs. Further, no action was taken by

the appellants against any of the OEMs. No communication, between

the appellants and the OEMs, on the basis of which it could be held

that the sale of the end-of-life HDDs was illegal, was on record.

64. It was further contended, by the respondents, that they did not,

in any manner, impair the condition of the HDDs. Rather, the

appellants had no use for them and had washed their hands of the

HDDs, once they reached “end of life” stage. The warranty provided

by the appellants had expired. The respondents repaired and

refurbished the HDDs and also provided a two-year warranty with call

(e) applies to any goods to which an indication of the country or place in which they were

made or produced or the name and address of the manufacturer or person for whom the goods are

manufactured is required to be applied under Section 139, a false indication of such country, place,

name or address; or

(f) tampers with, alters or effaces an indication of origin which has been applied to any

goods to which it is required to be applied under Section 139; or

(g) causes any of the things above mentioned in this section to be done,

shall, unless he proves that he acted, without intent to defraud, be punishable with imprisonment for a term

which shall not be less than six months but which may extend to three years and with fine which shall not be

less than fifty thousand rupees but which may extend to two lakh rupees:

Provided that the court may, for adequate and special reasons to be mentioned in the judgment, impose a

sentence of imprisonment for a term of less than six months or a fine of less than fifty thousand rupees.

30

Goods and Services Tax

FAO(OS) (COMM) 146/2024 and connected matters Page 32 of 87

back facility and after sales service to their consumers. Prior to

refurbishing of the HDDs, the respondents undertook various tests to

satisfy themselves that they were in working condition. If the HDDs

were found to be defective, they were returned to the supplier. If they

were working, the software contained on the HDDs was erased, and

they were reformatted and sold. As a result, consumers, who could not

afford the original HDDs, obtained working HDDs at a cheaper price.

No change, injurious to the HDDs, having taken place, it was

submitted that the respondents could not be regarded as having

“impaired” the HDDs.

65. The HDDs were sold under the respondents’ warranty and,

therefore, the principle of international exhaustion would apply. It was

further contended that removal of the original marks of the appellants

and re-branding of the HDDs with the respondents’ marks did not

attract Section 30(4) or any of the clauses of Section 29 of the Act and

did not, therefore, result in infringement.

66. Refurbishment, it was submitted, is not illegal.

67. The respondents further submitted that the plea of reverse

passing off was completely unjustified. There was no question of the

HDDs, once the registered marks of the appellants had been removed,

being identifiable as those of the appellants. They were embedded

deep inside the equipment in which they were installed. There was no

way in which the consumer would relate the HDDs to the appellants.

The HDDs were sold with a distinct Serial number and Model number,

FAO(OS) (COMM) 146/2024 and connected matters Page 33 of 87

and were not sold under the trade mark of the appellants. Even if the

identity of the original manufacturer could be discovered, it would

require a detailed technical analysis, which was a remote possibility.

Besides, as the appellants had themselves stated, the purchaser of such

a product was prudent, and would know that he was purchasing a

refurbished product.

68. Consistent also relied, before the learned Single Judge, on an

agreement between Seagate and Nickle Technologies executed in

2018, under which Nickle Technologies has been allowed to import

end-of-life HDDs manufactured by Seagate, for refurbishing. It was

therefore contended that Seagate could not plead ignorance regarding

the fact that their HDDs, which had reached end-of-life stage, were

removed, imported into India and sold after refurbishment. Seagate,

however, contested the relevance of this submission, stating that the

settlement with Nickle Technologies was applicable only inter partes,

especially as it formed the basis of a decree under Order XXIII Rule 3

of the CPC. Reliance was placed, for this purpose, on the decision in

Pankaj Goel v. Dabur India Ltd

31

.

IV. Observations and findings in the impugned judgment

69. Having thus set out the rival contentions advanced before him,

the learned Single Judge proceeds to address the various issues which

arose, seriatim, thus.

31

2008 SCC OnLine Del 1744

FAO(OS) (COMM) 146/2024 and connected matters Page 34 of 87

IV.1 Re. Importation and sale

70. The learned Single Judge notes that the appellants had not

referred him to any clause in their contracts with their OEMs,

prohibiting discarding or resale of end-of-life HDDs. Clearly, the

appellants had no control over the HDDs once they were embedded as

equipment, which were sold with the embedded HDDs under a

composite and integrated warranty of the OEM. It was not the case of

the appellants that they had held out any warranty to the ultimate

consumer. Ergo, at the stage of equipment integration of the HDDs,

the umbilical cord stood severed.

71. The learned Single Judge further notes that there was no rule,

Regulation or policy prohibiting import of discarded HDD/equipment

into India. Para 2.13 of the FTP, on which Seagate relied, did not

amount to a prohibition, so as to render the import of the HDDs into

India illegal.

72. The learned Single Judge, therefore, holds that there was no

basis to treat the importation of the end-of-life HDDs to be illegal.

IV.2 Sale to refurbisher

73. The learned Single Judge next proceeds to deal with the aspect

of the legality, or otherwise, of the sale of the imported HDDs to the

respondent-refurbishers. Inasmuch as the respondents had produced

invoices, under which they had purchased the HDDs after payment of

FAO(OS) (COMM) 146/2024 and connected matters Page 35 of 87

GST, the learned Single Judge holds that the onus shifted to the

appellants to demonstrate that the purchase of HDDs by the

respondents from the importers was illegal. No material, on the basis

of which such a conclusion could be reached, had been produced by

the appellants.

IV.3 Right to repair

74. The learned Single Judge observes that the policy of the Indian

Government recognised and encouraged the repair industry and that

the Ministry of Consumer Affairs had in fact set up a Committee to

come up with a “right to repair” framework. Acceptance of the

appellants’ submissions would result in killing the refurbishment

market.

IV.4 The aspect of infringement under the Act

75. Addressing the aspect of infringement in the context of Sections

30(3) and (4) of the Act, the learned Single Judge first reiterates his

finding that the importation of the HDDs, and their acquisition by the

respondents, was not illegal.

76. However, the learned Single Judge proceeds to hold, accepting

the submissions of learned amicus curiae appointed in the matter, that

the benefit of Section 30(3) would not be available to the respondents,

as they had sold the goods, purchased from the importers, after

removing the registered trade marks of the appellants, which would

FAO(OS) (COMM) 146/2024 and connected matters Page 36 of 87

not qualify as putting the goods on the market, within the meaning of

Section 30(3). The learned Single Judge holds, therefore, that, “even

if exhaustion applies, the defendants cannot get benefit of it under this

provision”.

77. The learned Single Judge further observes that the said

interpretation of Section 30(3) resonated, and was aligned, with

Section 30(4), as removal of the original trademark of the registered

proprietor would amount to change or impairment of the condition of

the HDDs and would, therefore, attract Section 30(4) and, ipso facto,

exclude the applicability of Section 30(3). This interpretation was also

in line with the law declared by the Division Bench in Kapil Wadhwa.

78. In line with the said decision, the learned Single Judge

proceeds, in para 93 of the impugned judgment, to observe that, as

there was no illegality in the import of the HDDs, which took place

with the original trademark of the appellants in place, the goods could

be sold along with a full disclosure. This approach, according to the

learned Single Judge, also resonates with the international perspective

on the issue, as reflected in the decisions in Champion Spark Plug

Co. v. Sanders

32

and Smith v. Montoro. The learned Single Judge

also places reliance on an article by Dr. Annette Kur, Professor in the

Max Plank Institute for Innovation and Competition, Munich, titled

“Sale of Repaired or Refurbished Goods: Commendable Practice or

Trade Mark Infringement?”

32

331 US 125 (1947)

FAO(OS) (COMM) 146/2024 and connected matters Page 37 of 87

IV.5 Reverse passing off

79. The learned Single Judge does not examine, in the impugned

judgment, on merits, the submission of the appellants that the acts of

the respondents resulted in “reverse passing off”, but disposes of the

issue thus, in para 96 of the impugned judgment:

“96. Retaining the manufacturer's trade marks would also

obviate the argument of the plaintiffs on reverse passing off.

Counsel for the plaintiffs had relied on Smith v. L. Montoro of the

United States Court of Appeal, 9th Circuit, submitting that in

removing references to the manufacturer's mark on the HDDs and

selling the refurbished product as their own, defendants were

indulging in an act of reverse passing off. The customer would

eventually find out where the product was originally manufactured

by the plaintiffs and would continue to be trace it back to the

plaintiffs. Such a situation would not arise if the refurbisher clearly

states that the goods are manufactured by the plaintiffs and that the

refurbisher is refurbishing them, for the purposes of extended use,

with a warranty exclusively provided by the refurbisher.”

IV.6 Conclusions of learned Single Judge

80. The learned Single Judge has thus concluded the discussion in

the impugned judgment:

“Conclusion

111. Refurbished, second hand, preowned goods exist in most

countries of the world since it caters to a different market, that of a

lesser paying customer. Originally manufactured goods, with their

mint new warranty, are obviously sold at the maximum retail price

and will be bought by people who require them and are ready to

pay for them, which is the market of the manufacturer/authorised

distributor/wholesaler/retailer. Once the sale has happened and the

warranty period attached to the goods is exhausted, none of these

entities i.e. manufacturer/OEM/wholesaler/distributor/retailer in the

FAO(OS) (COMM) 146/2024 and connected matters Page 38 of 87

chain would be liable for any repair or servicing. Of course, if the

retailer for purposes of promoting its sale, decides to give an

additional warranty over and above the manufacturer's warranty or

the OEM's warranty, that will only be a sales incentive.

112. Post-exhaustion of warranty, none of these entities i.e.

manufacture/OEM/wholesaler/distributor/retailer have any liability

or responsibility of the state of those goods, unless of course, there

is a mandate under any law, regulation or policy of managing their

disposal. In a situation where such policy or regulation does not

exist, or even if it exists but does not impose conditions on the

manufacturer, the umbilical cord is cut and the goods are in an

untethered space. This is exactly where the principle of exhaustion

comes into play; therefore, under Section 30(3)(b), the registered

owner/manufacturer has no right to object to any dealing.

113. The only caveat is in Section 30(4) where, if the marks are

removed from the original product or it is disfigured or changed in

a manner that possibly amounts to “change” or “impairment”, and

when such goods are sold as goods identified with the

manufacturer, the manufacturer's right kicks in to prevent the same.

This is obviously to prevent the loss of reputation and goodwill of

the manufacturer, since a consumer may potentially purchase that

product thinking that the changed/impaired product is from the

manufacturer.

114. This is where the necessity of “full disclosure” becomes

critical from the customer's perspective. If there is “full disclosure”

by the refurbisher that the change has been done by the refurbisher

and does not, therefore, resemble the original product, as doled out

by the manufacturer, inter alia, in terms of warranty, serviceability,

life, manuals and brochures — then consumers are fully warned as

to what they are purchasing. The consumer gets “the whole truth”.

The mandate of the “whole truth” is not only alive in the interstices

of Sections 30(3) and 30(4), but also expressly dealt with in

both Champion Spark Plug Co. and Kapil Wadhwa. Learned

amicus submissions also suggests the “whole truth” principle and,

therefore, informs our conclusion.

115. As noted above in Para 8 above, two kinds of orders were

passed by this Court in these batch of matters: (i) an ad interim

injunction; and (ii) directions permitting sale with a disclaimer on

the defendants' products of “used and refurbished”. Prima facie,

therefore, the necessity of disclaimer had also appealed to the

court, even at the initial stage of the matter.”

FAO(OS) (COMM) 146/2024 and connected matters Page 39 of 87

81. The judgment concludes with the directions, in para 116 and

reproduced in para 10 supra.

F. Rival Contentions before this Court

82. Given the number of Counsel who argued, and the volume of

submissions advanced, we deem it appropriate to itemize the

submissions, even though it may entail some repetition. We are also

including, here, the submissions of Ms. Shwetasree Majumder and Mr.

Sidharth Chopra, learned Counsel who appear for the parties in FAO

(OS) (Comm) 104/2025, as they are primarily concerned with the

same issues.

I. Submissions of Mr. Pravin Anand for WD

(i) Re. passing off

The act of the respondents in selling old and used HDDs of the

appellant, representing them to be new HDDs manufactured by

the respondent, amounts to “passing off”. Analysis of the

HDDs using the Crystal Disk Tool revealed that they had run

for extensive periods of time.

(ii) Re. reverse passing off

(a) The respondents were misrepresenting the

appellant’s products as theirs.

FAO(OS) (COMM) 146/2024 and connected matters Page 40 of 87

(b) Examination by the appellant’s engineers, and third

party technical experts, using the publicly available

Crystal Disk Info tool, revealed the original Serial and

Model Numbers, which were easily traceable to the

appellant. It was not necessary, for the purposes of

passing off, for the appellant’s mark to be visible to the

consumer at the time of sale of the HDD.

(c) If the HDDs malperformed, they would be

examined by technical persons, whereupon the

appellant’s particulars would be readily displayed. This

would lead to a presumption that the appellant authorized

sale of defective goods. (Presumably, the sequitur that is

implied is that the appellant’s goodwill and reputation

would stand tarnished.)

(d) The respondents’ acts have resulted in injury to the

appellant’s goodwill and reputation, and also reduction in

its market stake.

(e) Even in the modified packing, as per the directions

issued in the impugned judgment, the appellants’ identity

is disclosed only in the outer packing, not on the HDD.

FAO(OS) (COMM) 146/2024 and connected matters Page 41 of 87

Mr. Anand relies, for the purpose of his plea of “reverse passing

off”, on the judgment of the High Court of Bombay in Sheila

Mahendra Thakkar v. Mahesh Naranji Thakkar

33

(iii) Re. infringement

(a) The acts of the respondents in (i) buying used and

old HDDs of the appellant, (ii) effacing the appellant’s

trade marks, (iii) refurbishing the HDDs, (iv) affixing

their own brand with new Serial and Model numbers, (v)

selling them as new, and (vi) thereby altering and

impairing the original condition of the HDDs as sold by

the appellant to OEMs, amounts to infringement in view

of Section 30(4) of the Act.

(b) The impairment to the HDDs is not merely

cosmetic but relates to the functionality and reliability of

the HDDs.

(iv) Other submissions

(a) The HDDs are often used in surveillance

equipment. They have enhanced durability, vibration

resistance and surveillance specific optimizations. These

are critical to safeguard data for security and monitoring

33

2003 (27) PTC 501 (Bom) (DB)

FAO(OS) (COMM) 146/2024 and connected matters Page 42 of 87

applications, and stand compromised when used HDDs

are sold.

(b) Selling the appellant’s old and used HDDs as new

without disclosing the date of manufacture, the number of

hours of prior use, etc. amounts to false trade description,

which is actionable under Section 103 read with Section

2(1)(i) of the Act.

(c) The reliance, by the learned Single Judge, on the

“right to repair”, was misguided. The acts of the

respondents do not constitute “repair”. Repair cannot be

of an end-of-life product.

(d) The respondents used unauthorized third party

software tools to rewrite the appellant’s Model number

and Serial number and display their own.

(e) The concluding directions in the impugned

judgment are unworkable and impractical.

II. Submissions of Mr. Ranjan Narula for Seagate

(i) Re. passing off

Misrepresentation of used and old HDDs as new, and sale by

the respondents under their brands, after removing the marks of

FAO(OS) (COMM) 146/2024 and connected matters Page 43 of 87

the appellants, amounted to passing off. The respondents were

passing off old and used HDDs as new and unused.

(ii) Re. reverse passing off

(a) The HDDs were clearly identifiable as

manufactured by the appellants by the distinct shapes of

the silver plates and colours on the PCB

34

, which were

unique to the appellant.

(b) It was a clear case of consumer confusion, as the

respondents were offering the imported products as

refurbished Seagate HDDs.

(iii) Re. infringement

(i) Import of SEAGATE branded HDDs without the

appellant’s authorization itself constituted infringement in

view of Section 29(6) of the Act, which includes import

of goods within the meaning of the term “use”.

(ii) The only escape from this would be if Section

30(3) applied. However, this provision would not come

to the aid of the respondent as the HDDs were not

“lawfully acquired” by the respondents, as they had been

illegally removed from the computers and other

34

Populated Circuit Board

FAO(OS) (COMM) 146/2024 and connected matters Page 44 of 87

equipment in which they had been installed by the

OEMs. The HDDs were not meant for resale.

(iii) The mere fact that the HDDs had been purchased

by the respondents from importers under invoices which

included GST did not make their acquisition, by the

respondents, legal.

(iv) Section 30(3) was also not available to the

respondents as they were claiming to be

importing/manufacturing the HDDs, which was a clear

misrepresentation.

(v) As the importation of the HDDs was itself

unlawful, their subsequent purchase by the respondents

could not be lawful.

(vi) Removal of the appellant’s trade marks from the

HDDs amounted to change in their condition/impairment

within the meaning of Section 30(4) of the Act.

(vii) Removal of the appellant’s trade mark stickers,

followed by modification/reformatting of the HDDs,

followed by affixation, on the HDDs, of the respondent’s

marks, clearly justified application of Section 30(4).

FAO(OS) (COMM) 146/2024 and connected matters Page 45 of 87

(viii) In their written statement, the respondents had

contended that they were manufacturers and importers of

the HDDs, and were providing a two year warranty to

their suppliers. They were selling end-of-life products as

new without disclosing that they were refurbished. This

by itself constitutes legitimate ground for the appellant to

oppose further dealing in the HDDs by the respondents,

within the meaning of Section 30(4).

(iv) Other submissions

(a) The sale of used end-of-life HDDs as new

constituted misrepresentation to the consumer. The

respondents had produced no material to indicate that

they had subjected the HDDs to any technical

advancement.

(b) The concluding directions in the impugned

judgment, subject to fulfilment with which the

respondents had been permitted to sell the refurbished

HDDs, were beyond the pleadings and were contrary to

the case set up by the respondents themselves.

(c) The respondents were not “refurbishing” the

HDDs, as refurbishment involves extending of the life of

the product by making technical improvements.

FAO(OS) (COMM) 146/2024 and connected matters Page 46 of 87

(d) There was no “severance of the umbilical cord”

between the appellants and the OEMs, as the learned

Single Judge has held. In case of any defect during the

warranty period, the consumer approached the OEMs,

who in turn approached the appellants, who would repair

the HDDs if they were under warranty.

(e) Allowing the respondents to continue with their

activities could have serious consequences. The HDDs

were used in surveillance cameras, whose quality would

be diminished if end-of-life HDDs were used. This could

compromise surveillance integrity.

III. Submissions of Ms. Shwetasree Majumder for WD in FAO

(OS) (Comm) 104/2025

(i) Re. infringement

(a) The HDDs were not meant for retail sales. As such,

their purchase by the respondents could not be regarded

as “licit acquisition”.

(b) The invoice on record indicated that the HDDs

were, moreover, not purchased from the OEMs, but from

an unknown third party.

FAO(OS) (COMM) 146/2024 and connected matters Page 47 of 87

(c) There was material impairment in the condition of

the HDDs after they were put on the market by the

appellant. This was clear from a Technical Report on the

HDDs imported by the respondent and obtained from the

Customs authorities, by a Staff Engineer at SanDisk India

Device Design Centre Pvt Ltd which revealed that (i) the

HDDs were old and some were inoperable, and could not

be read, (ii) the HDDs were not in their original

Electrostatic Discharge (ESD) packaging and (iii) there

were stickers on the packaging hiding the date of

manufacture.

(d) The written statement of the respondent

acknowledged the fact that he had the intent to sell the

HDDs as new and original products, claiming an

“understanding” that they were unused.

(e) In this case, the respondent was intending to sell

the imported HDDs as it were under the appellant’s trade

mark. The case was not, therefore, one of refurbishing,

and Section 30(3) would not be available.

(ii) Other submissions

(a) There could be no question of allowing release and

sale of changed or impaired goods in the market with

“full disclosure”. The principle of “full disclosure”, as

enunciated in Kapil Wadhwa, applies where the goods as

FAO(OS) (COMM) 146/2024 and connected matters Page 48 of 87

such are sold in the market, not where they are changed

or impaired.

(b) The learned Single Judge could not have allowed

third parties to affix the appellant’s trade mark on the

goods. This violated Sections 29(2), (6) and (7)

35

of the

Act.

IV. Submissions of Mr. Dushyant Mahant, on behalf of Consistent

(i) Re. passing off

There was no misrepresentation by the respondents at any point,

either in the representations on the product HDDs or on the

packing thereof.

(ii) Re. reverse passing off

(i) The principle of reverse passing off is foreign to

Indian law.

(ii) In any event, for the principle to apply, the

consumer would have to identify the product as the

appellant’s at an initial glance, which was clearly not the

35

(7) A registered trade mark is infringed by a person who applies such registered trade mark to a

material intended to be used for labelling or packaging goods, as a business paper, or for advertising goods or

services, provided such person, when he applied the mark, knew or had reason to believe that the application

of the mark was not duly authorised by the proprietor or a licensee.

FAO(OS) (COMM) 146/2024 and connected matters Page 49 of 87

case here. No evidence to this effect was cited by the

appellants either.

(iii) The respondents did not use the appellant’s trade

marks at any point. No consumer would, therefore,

identify the HDDs with the appellants.

(iv) No consumer purchases the HDDs on the basis of

the shape of the silver plate or the colour on the HDDs.

The consumer, who purchases a refurbished HDD, does

so consciously and in full awareness of the fact.

(v) The identity of the appellants as the original

manufacturers of the HDDs could be discovered, if at all,

only on intensive technical analysis.

(vi) Thus, there is no question of reverse passing off.

(vii) The respondents have not, at any point of time,

tried to take advantage of the status or reputation of the

appellants’ registered trademarks.

(iii) Re. infringement

(a) The respondents were not using the appellant’s

trade marks in the course of trade. Section 29 was,

therefore, not applicable to refurbishers who were not

dealing in the goods under the registered trade marks of

FAO(OS) (COMM) 146/2024 and connected matters Page 50 of 87

the appellant. Per consequence, Section 30(3) would also

not apply.

(b) There is no material whatsoever, to indicate that

the acquisition of the HDDs by the respondents was

unlawful.

(c) No functional impairment had been caused to the

product. Rather, the respondents had improved and

repaired the HDDs and increased their life span. Section

30(4) was, therefore, not applicable.

(d) Debranding is not objectionable, as per Kerly’s

Law of Trade Marks.

(e) The extension, by the respondents, of their own

warranties and after sales service to their customers,

cannot concern the appellants in any way.

(iv) Other submissions

(a) The complaints raised by the appellants do not

pertain to the realm of intellectual property infringement

or passing off. They relate to import policy, enforcement

of the terms of the FTP, consumer protection, and the

like, which are not subject matter of these proceedings,

and could not have been adjudicated by the learned

FAO(OS) (COMM) 146/2024 and connected matters Page 51 of 87

Single Judge as part of the Intellectual Property Division

of this Court. No tort, relatable to Section 27 or 29 of the

Act, was pointed out by the appellants.

(b) The plea that the respondents were resorting to

false trade descriptions pertained to Section 103, not

Section 29 of the Act.

(c) The alternative packing suggested by the learned

Single Judge in the concluding paragraph of the

impugned judgment would allay all the apprehensions

and grievances of the appellants.

In support of his submissions, Mr. Mahant relies on paras

19.6.1, 19.9, 35.6, 36.1, 36.3, 40.1, 40.4, 40.6, 46 and 49 of the

judgment of the Supreme Court in Pernod Ricard.

V. Submissions of Ms. Rashi Bansal for Daichi and Geonix

(i) Re. passing off

(a) The appellants had no connection with the

respondents’ consumers. The appellants had not cited any

instance of any complaint being lodged, with them, by

any of the respondents’ consumers.

FAO(OS) (COMM) 146/2024 and connected matters Page 52 of 87

(a) The respondents were not riding on the appellant’s

goodwill or reputation. They were not using the

appellants’ trade marks at any stage.

(ii) Re. reverse passing off

(b) The buyer of such HDDs was prudent and

technically literate. He would know that he was

purchasing refurbished HDDs. There was, therefore, no

likelihood of confusion.

(c) Likelihood of confusion was required to be

established at the point of sale of the goods, and not at a

later stage, for a plea of passing off to succeed.

(d) The plea that the identity of the appellants as the

original manufacturers of the HDDs could be discovered

by using the Crystal Disk Info tool was, therefore,

inconsequential. Besides this tool was not available to, or

accessible by all and sundry.

(e) The appellants’ goodwill and reputation had not

been affected, in any manner, by the respondents’ acts.

The appellants had no business in refurbished goods. No

material indicating any damage to the appellants’

goodwill or reputation had been placed on record by

them.

FAO(OS) (COMM) 146/2024 and connected matters Page 53 of 87

(iii) Re. infringement

(a) Once the appellants had sold the HDDs to the

OEMs, the principle of international exhaustion applied.

(b) The respondents checked the condition of the

HDDs, gave them separate Serial and Model numbers

and thereafter sold them. They could not, therefore, be

said to have changed or impaired their condition for the

purposes of Section 30(4).

(iv) Other submissions

(a) As the appellants’ business interests, and goodwill,

were not affected by the respondents’ acts, they were not

subjected to any irreparable loss or prejudice as a result

thereof. They could, therefore, easily be compensated in

monetary terms, were they to succeed in the suit. The

balance of convenience was also, therefore, in favour of

denial, rather than grant, of injunction as sought by the

appellants.

VI. Submissions of Mr. Sidharth Chopra on behalf of Hansraj

Dugar

(i) Re. passing off/reverse passing off

FAO(OS) (COMM) 146/2024 and connected matters Page 54 of 87

Once there was full disclosure, there could be no question of

misrepresentation; ergo, there could be no passing off either.

(ii) Re. infringement

(a) Section 30(3) did not create a new specie of

infringement. Section 30 was titled “Limits on effect of a

registered trade mark”. Section 30(3), therefore, merely

articulated the principle of international exhaustion.

Infringement was required to be independently

established under Section 29. Sale of the appellant’s

HDDs, in their original condition, could never satisfy the

ingredients of Section 29. Section 29(6) was not an

independent substantive provision.

(b) That apart, even assuming Section 30(3) applied,

once the HDDs had been sold by the appellant to the

OEM, the title in the HDDs passed to the OEM. Further

sale by the OEM could not, therefore, be regarded as

illicit or illegal.

(c) Equally, once the respondent purchased the HDDs

against a valid commercial invoice, title in the HDDs

passed to the respondent. The appellant could not assert

its intellectual property rights to the derogation of the

ownership rights of the respondent.

FAO(OS) (COMM) 146/2024 and connected matters Page 55 of 87

(d) There was no material to indicate that the

acquisition of the HDDs, by the respondent, was

unlawful in the country in which they were acquired.

(e) “Change” or “impairment”, under Section 30(4),

implies a positive act, and not natural wear and tear.

G. Analysis

I. Re. the plea of “reverse passing off” and “passing off”

I.1 Plea of “reverse passing off” is foreign to our trade mark

jurisprudence, and does not clothe the appellants with an enforceable

cause of action

83. Mr. Dushyant Mahant sought to contend that the tort of “reverse

passing off” is foreign to trademark jurisprudence in this country.

84. The submission, prima facie, merits acceptance.

85. Trade mark rights, in our country, are cabined and confined

within the Trade Marks Act. The “saving clause” with reference to

passing off is contained in Section 27(2)

36

, which clarifies that nothing

in the Act would affect the rights of action against “any person for

passing off goods or services as the goods of another person or

services provided by another person, or the remedies in respect

36

(2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off

goods or services as the goods of another person or as services provided by another person, or the remedies in

respect thereof.

FAO(OS) (COMM) 146/2024 and connected matters Page 56 of 87

thereof”. It is true that the provision does not read “any person for

passing off his goods or services as the goods of another person or

services provided by another person…” However, we regarded it as

implicit, in Section 27(2), that passing off must be of one’s goods or

services as those of another. In other words, if Mr. X were to represent

the goods of Mr. Y as those of Mr. Z, it would not, to our mind,

constitute “passing off” as envisaged in Section 27(2).

86. This is also clear from various judicial pronouncements of the

Supreme Court which identify the ingredients of “passing off”.

87. In Kaviraj Pt Durga Dutt Sharma v. Navaratna

Pharmaceutical Laboratories

37

, the Supreme Court observed that “an

action for passing off is a Common Law remedy being in substance an

action for deceit, that is, a passing off by a person of his own goods as

those of another”. Similarly, in Satyam Infoway Ltd v. Siffynet

Solutions (P) Ltd

38

, the Supreme Court held that “an action for

passing off, as the phrase ‘passing off’ itself suggests, is to restrain the

defendant from passing off its goods or services to the public as that of

the plaintiff’s”. We may reproduce, to advantage, paras 13 to 15 of

Satyam Infoway thus:

“13. The next question is, would the principles of trade mark law

and in particular those relating to passing off apply? An action for

passing off, as the phrase “passing off” itself suggests, is to restrain

the defendant from passing off its goods or services to the public as

that of the plaintiff's. It is an action not only to preserve the

reputation of the plaintiff but also to safeguard the public. The

defendant must have sold its goods or offered its services in a

37

AIR 1965 SC 980

38

(2004) 6 SCC 145

FAO(OS) (COMM) 146/2024 and connected matters Page 57 of 87

manner which has deceived or would be likely to deceive the public

into thinking that the defendant's goods or services are the

plaintiff's. The action is normally available to the owner of a

distinctive trade mark and the person who, if the word or name is

an invented one, invents and uses it. If two trade rivals claim to

have individually invented the same mark, then the trader who is

able to establish prior user will succeed. The question is, as has

been aptly put, who gets these first? It is not essential for the

plaintiff to prove long user to establish reputation in a passing off

action. It would depend upon the volume of sales and extent of

advertisement.

14. The second element that must be established by a plaintiff

in a passing off action is misrepresentation by the defendant to the

public. The word “misrepresentation” does not mean that the

plaintiff has to prove any mala fide intention on the part of the

defendant. Of course, if the misrepresentation is intentional, it

might lead to an inference that the reputation of the plaintiff is such

that it is worth the defendant's while to cash in on it. An innocent

misrepresentation would be relevant only on the question of the

ultimate relief which would be granted to the plaintiff [Cadbury-

Schweppes (Pty) Ltd. v. PUB Squash Co. (Pty) Ltd.

39

; Erven

Warnink Besloten Vennootschap v. J. Townend & Sons (Hull)

Ltd.

40

]. What has to be established is the likelihood of confusion in

the minds of the public (the word “public” being understood to

mean actual or potential customers or users) that the goods or

services offered by the defendant are the goods or the services of

the plaintiff. In assessing the likelihood of such confusion the

courts must allow for the “imperfect recollection of a person of

ordinary memory” [Aristoc Ltd. v. Rysta Ltd.

41

].

15. The third element of a passing off action is loss or the

likelihood of it.”

(Emphasis supplied)

These passages stand approvingly cited by the Supreme Court in its

somewhat recent decision in Brihan Karan Sugar Syndicate Pvt Ltd

v. Yashwantrao Moyhite Krushna Sahakari Sakhar Karkhana

42

.

39

(1981) 1 WLR 193

40

(1979) 3 WLR 68

41

1945 AC 68 (HL)

42

(2024) 2 SCC 577

FAO(OS) (COMM) 146/2024 and connected matters Page 58 of 87

88. Inasmuch as Section 27(2) saves the “rights of action against

any person” for passing off, the right of action which is saved is,

clearly, the right of action against a defendant for passing off its goods

as those of the plaintiff.

89. Once Section 27(2) saves only the rights of action against a

person for passing off goods or services as those of another person,

and the Supreme Court has clarified that “passing off” involves

misrepresentation, by one person, of his goods or services, as those of

another, we cannot, by judicial fiat, expand the existing statutory

rights by including a right of action against a person for

misrepresenting goods or services of someone else as his own. That,

clearly, is not “passing off”, and the appellants acknowledge as much

by referring to it as “reverse passing off”. Section 27(2) does not save

the right, if at all, against a person for misrepresenting goods of

someone else as his own.

90. This position is fortified by a reading of Sections 134(1)

43

and

135(1)

44

of the Act.

43

134. Suit for infringement, etc. to be instituted before District Court.—

(1) No suit—

*****

(c) for passing off arising out of the use by the defendant of any trade mark which

is identical with or deceptively similar to the plaintiff's trade mark, whether registered or

unregistered,

shall be instituted in any court inferior to a District Court having jurisdiction to try the suit.

44

135. Relief in suits for infringement or for passing off. –

(1) The relief which a court may grant in any suit for infringement or for passing off referred

to in Section 134 includes injunction (subject to such terms, if any, as the court thinks fit) and at the

option of the plaintiff, either damages or an account of profits, together with or without any order

for the delivery-up of the infringing labels and marks for destruction or erasure.

FAO(OS) (COMM) 146/2024 and connected matters Page 59 of 87

91. Section 134(c) envisages institution of a suit “for passing off

arising out of the use by the defendant of any trademark which is

identical with or deceptively similar to the plaintiff’s trademark”.

Thus, the suit which may be filed under Section 134 is a suit which is

aggrieved by the use, by the defendant, of the trademark which results

in the tort of passing off. The defendant must, therefore, be the user of

the allegedly injurious trademark. This, too, indicates that the Act does

not envisage a suit by a plaintiff alleging that a defendant has passed

off the goods of the plaintiff or, for that matter, of anyone else, as his

own.

92. Section 135(1) provides for a relief of injunction, apart from

damages, delivery up and rendition of profits, “in any suit for

infringement or for passing off referred to in section 134”. No

injunction can, therefore, be granted in a suit which alleges that the

defendant is misrepresenting the plaintiff’s goods as its own, as that

would neither constitute “passing off” within the meaning of Section

27(2), nor does Section 134 envisage filing of a suit in such a case.

93. We, therefore, agree with Mr. Mahant that no right to sue, or

obtain an injunction, on the ground of “reverse passing off”, is

available in our jurisprudence, at least in trade mark law. We do not

express any view on whether any injunction, against such an act, is

available under any other statute, or law for the time being in force.

FAO(OS) (COMM) 146/2024 and connected matters Page 60 of 87

94. All arguments by the appellants, predicated on the allegation of

“reverse passing off” are, therefore, liable to be rejected even on this

ground.

I.2 Ingredients of “passing off” and “reverse passing off” are absent

95. Even if, for the sake of argument, we were to assume that

“reverse passing off” is actionable as a tort in our jurisprudence, the

ingredients of the said tort, as identified by the appellants themselves,

are, to our mind, absent in the present case.

96. “Reverse passing off”, according to learned Counsel for the

appellants, applies where a defendant seeks to misrepresent the goods

of the plaintiff as its own, but sufficient indicia exist to enable the

consumer to identify the goods as of the plaintiff. “Reverse passing

off”, therefore, involves two ingredients; the first being

misrepresentation, by the defendant, of the goods of the plaintiff as its

own, and the second being the ability of a consumer to identify the

goods as those of the plaintiff, despite attempts to the contrary by the

defendant.

97. Apropos the second ingredient, we are in agreement with the

submission of Ms. Bansal that the likelihood of identification, by a

consumer, of the goods as being those of the plaintiff, despite the

misrepresentation to the contrary by the defendant, must take place at

the time when the goods are initially seen by the plaintiff. Ms. Bansal,

FAO(OS) (COMM) 146/2024 and connected matters Page 61 of 87

therefore, seeks to incorporate, into the ingredients of “reverse passing

off”, the element of initial interest confusion.

98. The requirement of likelihood of confusion permeates both the

tort of infringement as well as that of passing off. The principle of

“initial interest confusion” requires the aspect of likelihood of

confusion by the consumer to be assessed at the point of “initial

interest”, i.e., when the consumer first sees the goods of the defendant.

This principle applies as much to passing off as to infringement, as

there is no qualitative difference between confusion in one case and

confusion in the other.

99. While “passing off” envisages confusion in the mind of the

consumer, when he sees the goods, or the mark, of the defendant,

“reverse passing off” envisages exactly the opposite, i.e., clarity in the

mind of the consumer, regarding the origin of the goods, despite the

defendant seeking to mask it. The likelihood of confusion, for the

purposes of passing off, must exist at the initial interest stage, and we

see no reason why this principle should not apply to the likelihood of

clarity, in the mind of the consumer, in a case of reverse passing off. In

other words, for a case of reverse passing off to successfully be

pleaded – assuming reverse passing off its actionable as a tort in our

jurisprudence – it must be shown that, though the defendant seeks to

misrepresent the goods as being his, though they are of the plaintiff,

by masking the plaintiff’s trademark or by any other means, the

consumer is able to identify the goods as those of the plaintiff at the

FAO(OS) (COMM) 146/2024 and connected matters Page 62 of 87

initial interest stage, i.e., when the consumer first comes across the

goods.

100. No material, to so indicate, has been cited or produced by the

appellants. Though it has been sought to be contended that the shape

and colour of the HDDs were unique to the appellants, and that they

would serve as sufficient indicia to enlighten the consumer that the

HDDs were originally manufactured by the appellants, no

corroborative material, to substantiate these assertions, is on record.

There is nothing to indicate that the shapes of the colours of the HDDs

were unique to the appellants, and were not used by anyone else in the

industry, nor is there enough material for us to come to a prima facie

conclusion that an average consumer would be able to identify the

HDDs as originating from the appellants solely on that basis. The

onus, to make out such a case, was undeniably on the appellants and,

to our mind, the onus has not been satisfactorily discharged.

101. Perhaps conscious of this chink in the appellants’ armour,

learned Counsel for the appellants have originally sought to contend

that, if the HDDs were scanned using the Crystal Disk Info tool, the

original Serial numbers and Model numbers affixed thereon by the

appellants, as well as the identity of the appellants themselves as the

original manufacturers of the HDDs, would be revealed. That,

however, would not amount to clarity in the mind of the consumer at

the initial interest stage and cannot, therefore, suffice to make out a

case of reverse passing off.

FAO(OS) (COMM) 146/2024 and connected matters Page 63 of 87

102. Besides, these submissions, again, are a matter of trial, at best.

Ms. Bansal has submitted, and we agree with her, that the Crystal Disk

Info tool may not be available for everyone to either access or source.

In fact, the appellants have led no material with respect to the ease of

accessibility of the Crystal Disk Info tool. The Court cannot, quite

obviously, accept, at face value, the contention of the appellants that

the tool is readily available or that it is frequently used or accessed.

These are all matters of evidence, which cannot constitute the basis for

deciding the Order XXXIX application.

103. A simultaneous, though somewhat fainter, submission was

advanced, by learned Counsel for the appellants, that, by

misrepresenting used and end of life HDDs as new, manufactured and

imported by the respondents, they were indulging in passing off.

Prima facie, we cannot agree. If the respondents were doing this, it

might amount to cheating the consumers and, perhaps, a ground to

proceed under consumer protection law, but it does not constitute

“passing off” as understood in trademark jurisprudence.

104. There is yet another reason why the appellants cannot, prima

facie, seek an injunction against the respondents on the ground of

“passing off” or “reverse passing off”. “Passing off” involves not

merely an aspect of misrepresentation, but also misappropriation of

the goodwill of the plaintiff, resulting in damage to the plaintiff. The

three ingredients of passing off, it is trite, are goodwill,

FAO(OS) (COMM) 146/2024 and connected matters Page 64 of 87

misrepresentation and damage

45

. If these are the ingredients of passing

off, we see no reason why they would also not be the ingredients of

reverse passing off.

105. Quite clearly, the respondents cannot be said to be

misappropriating the goodwill of the appellants in any manner. Nor

have the appellants been able to demonstrate that the goodwill which

resides in their registered trademarks has suffered any damage, or

prejudice as a result of the respondents’ acts. We agree with learned

Counsel for the respondents that, indeed, the existence of any such

damage may be doubtful, as the HDDs in which the respondents deal,

and which form subject matter of the present controversy, are end-of-

life HDDs, which effectively stand abandoned and for which the

appellants do not provide any warranty. Once the HDDs have reached

end-of-life stage, and have effectively been discarded by the OEMs,

we do not see how any goodwill of the appellants, in the marks affixed

on the said HDDs, could be said to continue to subsist.

106. Mr. Anand sought to submit, in this context, that, if the HDD

did not perform properly, and were to be serviced, the technical

persons who would then access the HDD would be able to ascertain

that the HDD was manufactured by the appellants. In such an event,

he submits that the consumer public might form an impression that the

appellant was complicit in allowing used and end of life HDDs to be

circulated in the market.

45

Refer S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, Toyota Jidosha Kabushiki Kaisha v.

Prius Auto Industries Ltd, (2018) 2 SCC 1, Cadila Health Care v. Cadila Pharmaceuticals Ltd, (2001) 5

SCC 73, Brihan Karan Sugar Syndicate

FAO(OS) (COMM) 146/2024 and connected matters Page 65 of 87

107. These are all submissions which belong to the realm of

assumption and conjecture. At the very least, they would require

evidence, to be substantiated even prima facie. In view of the fact that

the HDDs are sold, not under the trademarks of the appellants, but

under those of the respondents, we cannot accept Mr. Anand’s

submission that a consumer would form an impression that the

appellant had permitted circulation of the HDDs in the market.

108. There is, therefore, no prima facie evidence of misappropriation

of the appellants goodwill by the respondents or, for that matter, any

damage or prejudice being caused to the goodwill residing in the

appellants’ registered trade marks by the sale of the refurbished HDDs

by the respondents. Absent any such material, we are of the opinion

that no successful case of reverse passing off can be said to have been

made out.

109. We, therefore, are of the opinion that the appellants have not

been able to make out any case of passing off, or of reverse passing

off. The submissions to that effect by the appellants, therefore, deserve

to be rejected.

II. Re. infringement

II.1 Neither Section 30(3) nor Section 30(4) calls for invocation, as

no case of infringement within the meaning of Section 29 is made out

FAO(OS) (COMM) 146/2024 and connected matters Page 66 of 87

110. We have already set out, in paras 20 to 44 supra, our

understanding of Sections 30(3) and 30(4), vis-à-vis Section 29.

Viewed from that perspective, it is clear that no case of infringement,

even prima facie, can be said to be made out in the present appeals.

111. Section 30(3), as we have already observed, does not create a

new specie of infringement. It merely states that, if goods bearing a

registered trademark are lawfully acquired by a person, who thereafter

sells or otherwise deals in the said goods, then, if the circumstances

envisaged in clause (a) or clause (b) in the said sub-section apply, the

act of the person in selling or dealing in the goods would not amount

to infringement. By no stretch of imagination, to our mind, can

Section 30(3) be said to be carving out a new specie of infringement

or setting out circumstances in which the act of a person would

amount to infringement.

112. What Section 30(3) says is, therefore, that, if the sale of, or

dealing with, the lawfully acquired goods bearing the registered trade

mark of another otherwise amounts to infringement, then it would not

be infringing if either of the circumstances in clause (a) or (b) applies.

The question of applying Section 30(3), therefore, would arise only if

the sale of, or otherwise dealing in, the lawfully acquired goods

bearing the trademark of another, amounts to infringement within the

meaning of Section 29, as Section 29 constitutes a complete and self-

contained code with respect to infringement.

FAO(OS) (COMM) 146/2024 and connected matters Page 67 of 87

113. The respondents are not importers of the HDDs. They purchase

the HDDs from the importers and sell them in the market after

refurbishing. Before selling them in the market, the respondents efface

the registered marks of the appellants and affix their own trade marks.

114. It is nobody’s case that the respondents’ trade marks are either

identical with, or deceptively similar to, the appellants’ registered

trade marks. Sale of goods bearing a registered trademark, after

removing the trademark, cannot constitute “infringement” under any

of the sub-sections of Section 29. Without proceeding sub-section by

sub-section, a bare reading of Section 29 reveals that infringement,

within the meaning of the Section, takes place only where the

infringer uses the allegedly infringed registered trademark, or a

trademark which is deceptively similar thereto, in the course of trade.

“Use of a registered trademark” is defined in Section 29(6). It

includes, in clause (b), offering or exposing the goods, bearing the

registered trade mark, for sale, but does not include purchase of goods

bearing a registered trademark. Before selling the HDDs, the

respondents remove the appellants’ trademarks. They do not,

therefore, use either the appellants’ registered trademarks or any mark

which is deceptively similar thereto, in the course of trade. They do

not, therefore, commit any act of infringement, as defined in Section

29 of the Act.

115. If no act of infringement, within the meaning of Section 29, is

committed by the respondents, no occasion arises to proceed to

Section 30(3) of the Act, at all.

FAO(OS) (COMM) 146/2024 and connected matters Page 68 of 87

II.2 Assuming Section 30(3) is at all invocable, its ingredients are

fully satisfied

116. The learned Single Judge has, in the impugned judgment, held

that sale of the HDDs after effacing, therefrom, the originally affixed

trade marks of the appellants, and affixing the trade mark of the

respondents in their place, would not constitute further “sale” of the

HDDs for the purposes of Section 30(3). This observation, to our

mind, is not justified on a plain reading of Section 30(3).

117. The identity of the goods, as the goods per se, in Section 30(3),

is not dependent on, or conditioned by, the trade mark which may be

affixed or present thereon. The sub-Section refers to “goods bearing a

registered trade mark”. In other words, the registered trade mark is

only affixed on the goods, and the goods do not lose, or change, their

identity as the goods even if the trade mark is changed. Significantly,

Section 30(3) does not refer to “sale of the goods as such in the

market”, but only to “sale of the goods in the market”. The

interpretation placed by the learned Single Judge would amount to

reading, into Section 30(3), the words “as such”. This, to our mind, is

not permissible.

118. Even after effacing the originally affixed trademarks of the

appellants and substituting, in their place, the trademarks of the

respondents, the further sale of the goods in the market, with such

substituted trademark would, therefore, to our mind, constitute “sale

FAO(OS) (COMM) 146/2024 and connected matters Page 69 of 87

of the goods in the market” for the purposes of Section 30(3) of the

Act.

119. We are, however, in entire agreement with the learned Single

Judge that it cannot be said that the HDDs were not “lawfully

acquired” by the respondents.

120. We agree with Mr. Narula in his submission that if the import of

the HDDs was illegal, the subsequent acquisition of the illegally

imported HDDs by the respondents, even if under valid commercial

invoices, may not constitute “lawful acquisition”. However, there is

nothing to indicate, as the learned Single Judge has correctly

observed, that the import of the HDDs was in any manner illegal.

121. We endorse the findings of the learned Single Judge that the

appellants led no evidence to indicate that there was any proscription

on the OEMs to whom they had sold the HDDs, either contractual or

statutory, from further dealing in the HDDs, especially after they had

reached end-of-life stage and the appellants themselves provided no

further warranty. Though learned Counsel for the appellants

repeatedly asserted that the HDDs were not “meant for resale”, that

submission, besides itself being unsupported by any corroborative

material, begs the issue. The question is not whether the HDDs, as

supplied to the OEMs, were “meant for resale”, but whether there was

any proscription on the OEMs reselling them after they had reached

end-of-life stage. We endorse the finding of the learned Single Judge

that, from the material on record, no such proscription is forthcoming.

FAO(OS) (COMM) 146/2024 and connected matters Page 70 of 87

122. The extraction of the HDDs from the equipment into which they

had been installed by the OEMs, and further sale of the HDDs by the

OEMs, to the importers who later imported the HDDs into India

cannot, therefore, be regarded as unlawful.

123. Once the acquisition of the HDDs abroad, by the importers, is

not found to be unlawful, the next question to be addressed is whether

the import of the HDDs into India was illegal. The learned Single

Judge has answered this question in the negative, and we agree with

him.

124. Learned Counsel for the appellants relied, in this context, on

para 2.31 of the FTP. In the first place, the appellants could not be

permitted to rely on para 2.31 without referring to the Customs

Notification dealing with re-export of the refurbished HDDs. This is

for the simple reason that para 2.31 does not, in any way, prohibit

import of HDDs for refurbishing. In fact, it makes it clear that such

import was free. The only condition, contained in the said paragraph

of the FTP, was that the refurbished goods had to be re-exported as per

the applicable Customs Notification. At the highest, therefore, any

infraction of para 2.31 could take place only if the refurbished goods

were not re-exported as envisaged by the said paragraph. Besides the

fact that, if any infraction did take place on that count, it would not

render the import unlawful for the purposes of applicability of the

Trade Marks Act, but may constitute a ground for the Customs

authorities to proceed against the importer, no view in that regard can

FAO(OS) (COMM) 146/2024 and connected matters Page 71 of 87

be taken till the Customs Notification, governing re-export of the

refurbished goods, is there before us. None of the learned Counsel for

the appellants has produced the said Notification and, therefore, it is

not even open to us to arrive at the finding as to whether the condition

of re-export, as contained in para 2.31 was, or was not, breached.

125. In the absence of any such material, we agree with the learned

Single Judge that para 2.31 of the FTP does not, in any manner,

indicate that the import of the HDDs was illegal. Rather, para 2.31

makes it clear that the HDDs were freely importable.

126. Thus, as (i) no proscription on resale of the HDDs as sold by the

appellants to the OEMs, is forthcoming, (ii) there is no material to

indicate that the import of the HDDs into India was illegal and (iii) the

appellants had purchased the said HDDs from the importers under

commercial invoices on which GST was also paid, we endorse the

finding, of the learned Single Judge, that the appellants had “lawfully

acquired” the HDDs for the purposes of Section 30(3) of the Act.

127. Assuming that Section 30(3) at all called for invocation,

therefore, all indicia of the said provision stand fulfilled and, when

viewed in the light of Section 30(3) alone, the acts of the respondents

cannot be said to amount to “infringement”.

II.3 Section 30(4) is not applicable

FAO(OS) (COMM) 146/2024 and connected matters Page 72 of 87

128. Section 30(3), however, is subject to Section 30(4), in that, if

Section 30(4) applies, the protection of Section 30(3) would not be

available. Even in such a case, to our mind, the act of the respondents

would not ipso facto amount to infringement, if the ingredients of

Section 29 are not fulfilled in the first instance.

129. We cannot agree with Mr. Anand in his submission that, if

Section 30(4) would apply, the respondents’ acts would ipso facto

become infringing. The “exception to an exception” argument of Mr.

Anand, in our view, over-simplifies the issue. We are prepared to go

along with Mr. Anand in this submission, to the extent that Section

30(4) is in the nature of an exception to an exception. If, therefore,

Section 30(4) does apply, the only result is that the benefit of Section

30(3), which would protect the respondents’ acts from the taint of

infringement, would not apply. The acts, themselves, would

nonetheless have to be shown to be infringing, within the meaning of

Section 29, as Section 30(3), we reiterate, does not create a new and

independent specie of infringement.

130. In the facts of the present case, we are, however, of the view

that Section 30(4) would not apply. We have already advanced our

interpretation of Section 30(4) in paras 39 to 44 supra. Applying the

said interpretation, it cannot be said that legitimate reasons existed or

the appellants to oppose further dealings in the refurbished HDDs by

the respondents or, indeed, the refurbishment act itself.

FAO(OS) (COMM) 146/2024 and connected matters Page 73 of 87

131. The learned Single Judge has held, in the impugned judgment,

that the umbilical cord binding the appellants to the HDDs was

severed immediately upon the HDDs being installed, by the OEMs, in

computers or other such equipment. Learned Counsel for the

appellants countered this finding and, to justify the challenge, pointed

out that the appellants continued to extend warranty, for the HDDs,

even after they were installed in the equipment. Learned Counsel

submit that, if the OEM received any complaint from the consumer to

whom the computer or other equipment was sold, and the defect was

found to reside in the HDD, the OEM contacted the appellant, who

would effect the requisite repair, if the HDD was within warranty

period.

132. This submission, even by itself, defeats the appellants’ case,

insofar as the aspect of severing of the umbilical cord is concerned, as

it links the “umbilical cord” to the providing of warranty by the

appellants. Applying the extension, by the appellants themselves, of

the metaphor employed by the learned Single Judge, the umbilical

cord might not have been severed at the point when the HDDs were

installed in the equipment by the OEMs, but it unquestionably stood

severed when the HDDs reached end-of-life stage, and the appellants’

warranty, in respect of the HDDs, was no longer available. After that

point, we concur with the learned Single Judge that the appellants did

not have any further concern with the HDDs, or what was done with

them.

FAO(OS) (COMM) 146/2024 and connected matters Page 74 of 87

133. There is nothing to indicate that the respondents’ acts impaired

the condition of the HDDs in any manner. Indeed, no such plea of

impairment has even been seriously advanced by the appellants. The

appellants’ contention is that, by erasing the appellants’ registered

marks and affixing, on the HDDs, their own trademarks, removing the

software embedded in the HDDs by the appellants and replacing it

with their software, and changing the Serial numbers and Model

numbers of the HDDs, the respondents “changed” the condition of the

HDDs within the meaning of Section 30(4).

134. We have already opined that the word “changed”, as employed

in Section 30(4), has to be read noscitur a sociis with the word

“impaired”. Read together, applying the said principle, it cannot be

said that the respondents “changed or impaired” the condition of the

HDDs by the acts undertaken by them. Significantly, it has never been

the contention of learned Counsel for the appellants that the appellants

were in any manner concerned with, or were entitled to monitor,

further transactions in respect of the HDDs, once they reached end-of-

life stage and the appellants ceased to provide any warranty in respect

thereof.

135. In that view of the matter, irrespective of the aspect of whether

the respondents changed or impaired the condition of the HDDs, we

are further of the view that there could not be said to exist any

legitimate reason for the appellants to oppose further dealings in the

HDDs.

FAO(OS) (COMM) 146/2024 and connected matters Page 75 of 87

136. It might have been another matter if the manner in which the

respondents dealt with the HDDs was in any manner prejudicial to the

appellants, or diminished their goodwill or reputation. No material,

worth its name, is forthcoming to the said effect. Any change in the

HDDs, even if effected by the respondents, could not be said to

prejudice the appellants in any manner, so as to provide, to the

appellants, legitimate reasons to oppose further dealings in the HDDs,

within the meaning of Section 30(4) of the Act.

137. As a result, we are of the opinion that Section 30(4) would not

be available to the appellants.

II.4 The sequitur

138. The sequitur would, therefore, be that no case of infringement,

of the appellants registered marks, can be laid at the door of the

respondents.

III. Other submissions

139. Other submissions advanced by the appellants are, really, of no

substantial significance.

140. The submission that the HDDs are used in surveillance

equipment and that, if their quality is compromised, it could result in

security concerns, is really neither here nor there. No material, to

indicate that the refurbished HDDs could not be used in the

FAO(OS) (COMM) 146/2024 and connected matters Page 76 of 87

surveillance equipment, is forthcoming. In any event, this is a

consideration which is alien to the controversy before us, as it does

not impact either infringement or passing off.

141. The plea that the respondents were indulging in “false trade

descriptions” is, again, irrelevant to the issue in controversy. No

remedy, under Section 135 of the Act, is available on this ground. As

learned Counsel for the appellants themselves acknowledge, resorting

to “false trade descriptions” is covered by Section 103 of the Act,

which cannot constitute a ground to seek an injunction.

142. The learned Single Judge has proceeded on the concept of

“right to repair”. Learned Counsel for the appellants submit that the

acts of the respondents do not fall within the purview of the concept of

“repair”. To our mind, this discussion is unnecessary for the purposes

of resolution of the controversy in issue. We do not, therefore, propose

to enter into this aspect.

IV. Re. concluding directions issued by the learned Single Judge

143. Learned Counsel for the appellants sought to contend that the

respondents ought to have been altogether injuncted, and that,

therefore, the concluding directions issued by the learned Single Judge

were not justified. Mr. Anand has also sought to contend that they are

unworkable.

FAO(OS) (COMM) 146/2024 and connected matters Page 77 of 87

144. The respondents have not chosen to challenge the said

directions.

145. In view of our finding that there is no prima facie case either of

passing off, or of reverse passing off, or of infringement, the

applications of the appellants, under Order XXXIX Rules 1 and 2 of

the CPC, deserved, in our view, to be dismissed.

146. It may also be disputable whether, having found the respondents

not to be entitled to the benefit of Section 30(3), and that Section

30(4) applied – with both of which conclusions we respectfully beg to

disagree – the learned Single Judge could have proceeded to issue the

directions contained in para 116 of the impugned judgment. We may

note that this Court, in a recent decision in Mohd Talha v. Karim

Hotels (P) Ltd

46

, issued similar directions, which stand stayed by the

Supreme Court vide order dated 19 January 2026 in SLP (C)

615/2026

47

, recording the submission of learned Senior Counsel for

the appellant that the directions conflicted with the findings regarding

infringement. Till the Supreme Court finally speaks on the issue,

therefore, the existence, or otherwise, of power to issue such

directions, in an application under Order XXXIX Rules 1 and 2 of the

CPC, may be said to be somewhat of a grey area. We may, however,

note, in this context, the clear enunciation of the law, in Midas

Hygiene Industries (P) Ltd v. Sudhir Bhatia

48

, to the effect that,

where infringement is found to exist, an injunction must follow.

46

2025 SCC OnLine Del 8240

47

Karim Hotels Pvt Ltd v. Mohd Talha

48

(2004) 3 SCC 90

FAO(OS) (COMM) 146/2024 and connected matters Page 78 of 87

147. Be that as it may, we do not propose to disturb the directions

issued by the learned Single Judge, invoking the principle that a party

should not be worse off for having appealed.

H. Itemising our findings

148. For the sake of convenience, we may itemise our findings thus:

(i) “Reverse passing off” is not an actionable tort, in our

trade mark jurisprudence. This is, inter alia, apparent from a

reading of Section 27(2) read with Sections 134(1) and 135(1)

of the Act, in conjunction with the judgments of the Supreme

Court identifying the ingredients of passing off, including, inter

alia, Kaviraj Pt Durga Dutt Sharma and Satyam Infoway.

(ii) Assuming, arguendo, that “reverse passing off” was

actionable as a tort in India, its ingredients are, nonetheless,

absent in the present case as:

(a) the “initial interest” test would apply to reverse

passing off as well,

(b) the ability of the consumer to be able to identify

the goods with the original registered trade mark owner

must, therefore, be at the time of initial sale of the goods,

(c) there was nothing to indicate that, at the time of

sale of the refurbished HDDs by the respondents, the

FAO(OS) (COMM) 146/2024 and connected matters Page 79 of 87

consumer would be able to identify them as having been

originally manufactured by the appellants,

(d) the ability to identify the HDDs as having

originated from the appellant using the Crystal Disk Info

tool, could not make out a case of “reverse passing off”,

apart from the fact that the very availability and

accessibility of the said tool would be matters requiring

evidence and trial,

(e) there was no misappropriation, by the respondents,

of any goodwill of the appellants, and

(f) no material evidence of any damage which had

resulted to the appellants, as a result of the acts of the

respondents, was available either.

(iii) For the same reason, no case of passing off could, either,

be said to exist. Even if it were to be assumed that the

respondents were misrepresenting the HDDs as new and,

thereby, misleading consumers, that would not constitute

“passing off” as understood in trademark jurisprudence.

(iv) In so far as infringement was concerned, Section 30(3)

does not create a new specie of infringement but only clarifies

that, if the act of a person who lawfully acquires goods bearing

a registered trade mark of another, sells them in the market, it

would not amount to infringement, if the circumstances

envisaged in Section 30(3) applied. As such, the question of

resort to Section 30(3) would arise only if the defendants’ acts

FAO(OS) (COMM) 146/2024 and connected matters Page 80 of 87

amounted otherwise to “infringement” within the meaning of

Section 29.

(v) “Infringement”, under Section 29, requires use, by the

defendant, of the registered trademark of the plaintiff or of a

deceptively similar mark. Inasmuch as the respondents efface

the appellants’ marks from the HDDs before refurbishing and

selling them, the respondents’ acts cannot constitute

infringement. As such, Section 30(3) would not call for

application.

(vi) Assuming, arguendo, that Section 30(3) applies, its

ingredients stand satisfied, as

(a) there is no evidence of any proscription on the

OEMs further selling the HDDs, especially after they had

reached end-of-life stage,

(b) import of the HDDs was not prohibited,

(c) the respondents had purchased the HDDs against

commercial invoices on which GST was paid, and

(d) the appellants had themselves placed the HDDs on

the market.

(vii) Section 30(4) would not apply, as there was no change or

impairment of the HDDs by the respondents, the expression

“changed” having to be understood noscitur a sociis with the

word “impaired”, and there was, even otherwise, no legitimate

FAO(OS) (COMM) 146/2024 and connected matters Page 81 of 87

reason for the appellants to object to further dealings in the

HDDs by the respondents.

(viii) Thus, no case of infringement, either, could be said to

exist.

(ix) The operative portion of the impugned judgment is

maintained, as there is no challenge, thereto, from the

respondents, and the appellants could not be placed worse off

for having preferred an appeal.

I. Conclusion

149. The appeals are, therefore, dismissed.

FAO (OS) (Comm) 104/2025

J. Facts

150. The respondent, in this case, himself imported HDDs, bearing

the appellant’s trade mark, from Hong Kong and Korea. As in the case

of the other appeals decided by this judgment, the HDDs were

originally sold by the appellant to OEMs located abroad, from whom,

after they had reached end-of-life stage, they were removed from the

equipment in which they were installed and sold. Admittedly, at the

time of import, the HDDs bore the appellant’s registered trademark.

FAO(OS) (COMM) 146/2024 and connected matters Page 82 of 87

151. The appellant submitted that it had been informed

telephonically, by the Deputy Commissioner of Customs, that a

consignment of HDDs had been imported at the Kolkata Port, which

included HDDs of the appellant. The appellant proceeded to institute,

before this Court, the suit from which the present appeal emanates,

seeking a decree of permanent injunction restraining the respondent

from importing or dealing with any HDDs which had been originally

sold by the appellant and which bore the appellant’s registered trade

marks.

152. The suit was accompanied by IA 14659/2019, under Order

XXXIX Rules 1 and 2, seeking interim injunction. An ex parte ad

interim injunction was granted on 21 October 2019, for the vacation of

which the Respondent filed IA 38495/2024 under Order XXXIX Rule

4 of the CPC. Both these applications were disposed of, by the learned

Single Judge of this Court, by judgment dated 16 May 2025, against

which the present appeal has been filed.

153. The learned Single Judge, while noting that, as the goods had

been seized while in Customs area, it was not possible to ascertain the

further use to which they were intended to be put and, therefore, that it

was not possible to hold that the appellants had made any

misrepresentation to the consumer public, found the case to be

otherwise parallel, on facts, to the dispute which was decided by his

predecessor by the judgment dated 21 May 2024, which forms

subject-matter of challenge in the batch of appeals earlier decided by

this judgment.

FAO(OS) (COMM) 146/2024 and connected matters Page 83 of 87

154. The learned Single Judge, therefore, disposed of the

applications before him in the following terms:

“37. In case the defendant wishes to resell the imported goods

without refurbishment, the defendant would be free to import

second-hand goods or “end-of-life” goods bearing the trade marks

of the plaintiffs, while adhering to the disclosure norms in Xerox

Corpn. as set out above. However, in the event the goods are

refurbished and subsequently sold in the market, the disclosure

norms given in para 116 of Daichi International case

1

would

apply mutatis mutandis in respect of goods imported by the

defendant and sold after refurbishment.

38. Insofar as the goods already imported by defendant are

concerned, it is an admitted position that they are still lying in a

customs warehouse since the time of their import. This Court,

while passing an ex parte interim order dated 21-10-2019, has

specifically provided that the demurrage or other charges payable

to Custom Authority, shall be paid by the defendant.

39. In light of the discussion above, the goods seized by the

Local Commissioner and now lying with the Custom Authority are

permitted to be released to the defendant, subject to the defendant

filing an undertaking that the said goods shall be sold only as scrap

after removing all marks of the plaintiffs. The defendant shall be

free to pursue his remedies that may be available in law with regard

to demurrage charges payable to the customs.”

155. We have already noted, herein above, the submissions of Ms.

Majumder and Mr. Chopra, learned Counsel appearing for the rival

parties in this appeal.

K. Analysis

156. The only point of difference between this appeal, and the other

appeals which stand decided by this judgment, is that the respondent,

FAO(OS) (COMM) 146/2024 and connected matters Page 84 of 87

in this case, was himself the importer of the end-of-life HDDs sold by

the appellant to OEMs abroad and purchased by the respondent.

157. Though Ms. Majumder seeks to contend that the invoice on

record, whereunder the respondent had purchased the HDDs in Hong

Kong, had not been issued by the appellants’ OEM, that factor may

not be of substantial significance at this stage. In so far as the purchase

of the HDDs abroad is concerned, the findings and observations

entered by us hereinabove, with respect to the batch of appeals

challenging the order dated 21 May 2024, would equally apply to the

present case, as, here, too, the appellant has not been able to contend

that there was any restriction on further sale of the HDDs by the

OEMs after they had reached end-of-life stage. The purchase of the

HDDs abroad, by the respondent has, therefore, to be treated, at least

at this stage, to be licit.

158. Unlike the case of the respondents in the batch of appeals

covered by the order dated 21 May 2024, however, the respondent, in

the present case, himself imported the HDDs bearing the registered

trademark of the appellant. Inasmuch as import of goods bearing a

registered trade mark amounts to “use” of the registered trademark

under Section 29(6), and as the respondent was neither the proprietor,

nor the permissive user of the registered trademark of the appellant,

the import of the HDDs by the respondent was infringing in nature,

within the meaning of Section 29.

FAO(OS) (COMM) 146/2024 and connected matters Page 85 of 87

159. In this case, therefore, Section 30(3) would come into play, to

examine whether the respondent would be entitled to the benefit of the

said sub-section and, therefore, would escape the taint of

infringement.

160. The answer, to our mind, has necessarily to be in the

affirmative.

161. All conditions of Section 30(3) stand satisfied in this appeal as

well. The purchase of the HDDs by the respondent abroad is prima

facie licit. No restriction or prohibition, against import of the HDDs

into India, is forthcoming, and the findings in that regard, returned in

respect of the earlier batch of appeals, would apply mutatis mutandis

to the present appeal as well. There is no question of the respondent

having changed or impaired the condition of the HDDs, as they were

seized while in Customs area. That said, if the respondent were to deal

with the HDDs in the manner in which the respondents in the above

batch of appeals dealt, there would be no justification to invoke

Section 30(4).

162. Ms. Majumder sought to contend that the HDDs were not meant

for retail sale. For this purpose, however, she relies only on a

Technical Report of a Staff Engineer at SanDisk India Device Design

Centre Pvt Ltd. Such a report cannot form the basis of consideration at

an Order XXXIX stage, till the author of the report is subjected to

cross-examination.

FAO(OS) (COMM) 146/2024 and connected matters Page 86 of 87

163. That apart, the report merely states that (i) the HDDs were old

and some were inoperable, and could not be read, (ii) the HDDs were

not in their original Electrostatic Discharge (ESD) packaging and (iii)

there were stickers on the packaging hiding the date of manufacture.

This does not, in any way, indicate that there was any restriction or

proscription on further sale of the HDDs by the OEMs, especially

after they had reached end-of-life stage.

164. Ms. Majumder also sought to contend that the permission,

granted by the learned Single Judge to the respondents, to affix the

respondents’ mark, would violate Sections 29(2) and (7) of the Act.

The submission cannot be accepted, as, in the present case, there was

no effacing of the appellants’ mark. Besides, Section 29(2) would not

apply as there is no likelihood of confusion.

165. But for these differences, there is no substantial distinction, on

facts or in law, in the issue and controversy in the above batch of

appeals and in the present appeal.

L. Conclusion

166. For the reasons already set out earlier in this judgment,

therefore, this appeal must also fail, and is accordingly dismissed.

167. There shall be no orders as to costs.

FAO(OS) (COMM) 146/2024 and connected matters Page 87 of 87

168. Needless to say, as these appeals are directed against orders

passed by the learned Single Judge under Order XXXIX of the CPC,

observations and findings contained in this judgment shall not inhibit

the view which the learned Commercial Court may choose to take on

the merits of the disputes between the parties, while adjudicating the

substantive suits.

A closing remark

169. We believe that commendation should be granted where it is

due. We, therefore, record our appreciation for the manner in which

Ms. Rashi Bansal, whom we have had the pleasure of hearing in detail

for the first time, argued her matter, with clinical precision and

without a word out of place. She more than held her own against

seasoned stalwarts like Mr. Anand and Ms. Majumder who appeared

opposite her. We predict a bright future for her, and wish her well.

C. HARI SHANKAR, J.

OM PRAKASH SHUKLA, J.

MARCH 09, 2026/aky/yg