Khadi And Village Industries Commission vs. Rishabh Agarwal
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The Plaintiff, Khadi and Village Industries Commission, the registered proprietor of the trademark "KHADI", filed a commercial suit seeking an injunction against the Defendant, Rishabh Agarwal, from using the impugned marks "KHADIO" and "KHADIO". The Plaintiff discovered the Defendant's website "www.khadio.com" in August 2021 and subsequently issued a cease and desist notice. The Defendant agreed to discontinue the use of the impugned mark, withdraw a trademark application for "K(HADIO", remove the impugned mark from existing stock within two weeks, and cease selling products bearing the mark. The Defendant also undertook to rename his firm, M/s Shri Nath Ji Khadi Udyog, including updating his GST registration within six weeks. The Plaintiff's counsel agreed to dispose of the suit based on the Defendant's undertaking, subject to instructions regarding damages. The Court noted that the Defendant had proactively ceased operations under the impugned mark upon learning of the Plaintiff's rights.
Held
The Court held that the case did not warrant an award of damages to the Plaintiff. The reasoning was based on Section 135(3)(b)(ii) of the Trademarks Act, 1999, which provides that damages shall not be granted if the defendant demonstrates that upon learning of the plaintiff's trademark rights, they forthwith ceased to use the complained-of mark. The Court found that the Defendant herein had agreed to stop using the mark "KHADIO" and had proactively ceased its operations thereunder. Furthermore, on the first date of hearing, the Defendant, without issuance of summons, agreed not to use the impugned mark. The ratio decidendi is that prompt cessation of infringing activity upon notice of the trademark owner's rights negates the claim for damages under Section 135(3)(b)(ii) of the Trademarks Act, 1999. The suit was decreed in favour of the Plaintiff and against the Defendant, binding the Defendant to his undertaking. The Court also directed the refund of court fees to the Plaintiff. The issue of damages was expressly left undecided in favour of the Defendant based on the aforementioned provision.
Key Issues
1. Whether the Court should grant the relief of damages to the Plaintiff, considering the Defendant's actions and the provisions of Section 135(3)(b)(ii) of the Trademarks Act, 1999? The Plaintiff argued for damages, while the Defendant contended that damages should not be awarded as he ceased using the mark "KHADIO" upon learning of the Plaintiff's rights and proactively stopped its operations. The Defendant relied on Section 135(3)(b)(ii) of the Trademarks Act, 1999, which states that damages shall not be granted if the defendant demonstrates they forthwith ceased to use the trademark complained of upon learning of the plaintiff's rights. The judgment does not record any specific arguments from the Plaintiff regarding the application of this section or any other precedents.
Sections Cited
Section 135(3)(b)(ii)
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Cause title — parties, addresses and appearances
ORDER % 16.03.2023
Let the plaint be registered as a suit.
The Plaintiff, registered proprietor of the trademark "KHADI" and its formative versions mentioned in paragraph No. 13 of the plaint, has filed the instant lawsuit seeking inter alia permanent injunction restrainingDefendant from using the mark "KHADIO" and "KHADIO" [hereinafter, "impugned mark"].
Pursuant to court directions, Plaintiff served an advance copy of the paper-book to the Defendant Mr. Rishabh Agarwal, who has appeared in person.
Mr. Agarwal states as follows: a The use of the impugned mark has been discontinued and same shall (DePenDANT, In Person This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/05/2026 at 10:33:45
not be used anytime in future, without the permission of the Plaintiff. RING b) He will be using BY RISHABY AGARWAL trademark for his business and manufacturing activities, in respect whereof, he has already secured registration in class 25 [application No. 5092574]. The application No. 3685544 for registration of "K(HADIO" mark shall be withdrawn, for which he will take immediate steps. d) The impugned mark/ label shall be removed from the existing stock of goods, if any, within two weeks from today and no products bearing the impugned mark shall be sold hereinafter. He will take steps to rename his firm M/s Shri Nath Ji Khadi Udyog, which subsumes the Plaintiff's registered "KHAD!" mark. The necessary formalities, including change of name in the GST registration, with the appropriate authorities shall be undertaken immediately and completed within a period of six weeksfrom today. In the event any listings of impugned products are stillavailable on the internet, upon Plaintiff's intimation of such listings, he would immediately take appropriate action to have them removed.
Ms. Diva Arora, counsel for Plaintiff, is agreeable to disposal of the suit on Mr. Agarwal's undertaking, but states that she will have to take instructions from her client qua the relief of damages.
Heard. In August, 2021, Plaintiff first learnt of Defendant's website "www.khadio.com" and later, upon subsequent inquiries, came across Defendant's application for registration DE FENDAUTIN PERION] This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/05/2026 at 10:33:45
August, 2021, they issued a cease and desist notice to Defendant inter alia, agreed and demanding them to cease commercial activities under the said mark transfer the aforesaid domain name in Plaintiff's favour. Defendant Accordingly, Defendant rebranded itself,transferred the domain name and to comply therewith and negotitations took place between the parties. impugned products on different e- as per Mr. Agarwal, all the listings of the commerce and social media websites were also removed. The only grievance thereafter pertained to withdrawal of Defendant's trademark the application and use of labels bearing "KHADIO", on which aspect Defendant was amenable to settlement. Plaintiff did not even attempt pre-institution mediation or effect advance service on Defendant on their own. Section 135(3)(b)(ii) of the 7. if the Defendant demonstrates that upon learning of Plaintiff's Trademarks Act, 1999 provides that the Court shall not grant the relief of damages trademark complained of. Defendant herein had agreed to stop using the existence and their right in the mark, they forthwith ceased to use the mark "KHADIO" and even proactively ceased its operations thereunder. In the present proceedings, on the very first date, on advance service, without issuance of summons, Defendant has come forward and agreed not to use the impugned mark "KHADIO".
Considering the above facts and circumstances, the Court is of the opinion that instant case does not invite awardof damages to the Plaintiff. explore pre-institution mediation envisaged under the Commercial Courts
The facts of this case demonstrate a compelling need for parties to Act, 2015 before resorting to litigation. This would help bring down unnecessary lawsuits. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/05/2026 at 10:33:45
Binding the Defendant to his undertaking recorded in paragraph No. 4 of the order, the suit is decreed in favour of the Plaintiff and against the Defendant in terms of prayers (a) and (b) contained in paragraph No. 64 of the plaint.
The suit is decreed in above terms. No order as to costs.
The suit is being disposed of on the first date on Defendant's statement, who has decided not to contest, which indicates a compromise between the parties. Accordingly, Registry is directed to issue a certificate for refund of court fees in favour of the Plaintiff. SANJEEV NARULA, J MARCH 16, 2023 sti The order was dictated in the open court on the date of hearing; signatures of parties have been affixed on 231d March, 2023. Defen DANTAN PELION This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/05/2026 at 10:33:45
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.