Use of trade name: Court dismisses NIFD plea for interim injunction against firm

Tribune News Service

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Chandigarh, August 23

A local court has dismissed an application filed by directors of the National Institute of Fashion Design (NIFD), Chandigarh, for grant of ad interim injunction against Nurturing Ideas for Design Private Limited and its 42 franchisees located across the country for restraining them, their representatives, agents, etc, from using the trade name ‘NIFD’, trademark ‘INIFD’ or Trade name ‘NIFD Institute of Fashion Design Limited’ or engaging in any deceptive practice that may cause confusion with the their brand.

The company stated that it being sole holder of the trademark had the exclusive right to use and transact the same. The company also sought mandatory injunction for a direction to the defendants to cease, remove, surrender and give up all claims, advertisements, displays, practices or any semblance of assertions that borrow the goodwill of the company.

Anand Chhibbar, senior advocate along with advocate Yogesh Mittal, while appearing for the defendants, argued that the plaintiff was a limited company. Therefore, the plaintiff number 2 (one of the directors) had no authority to file the present suit as no resolution was passed in her favour.

Chhibbar argued that as per provisions of the Companies Act, 2013 , a valid resolution was required to be passed by directors authorising the person to sue the case on behalf of the company and suit filed by the plaintiffs was liable to be dismissed on this ground.

After hearing of the arguments, the court observed that though the defect of filing of suit or appeal in absence of a resolution by the Board of Directors was curable by rectification, such an eventuality was completely ruled out in the present case as a majority of shareholders were already against the applicants-plaintiffs number 2 and 3 and they had categorically stated that they had never authorised the plaintiffs number 2 and 3 to file the suit on behalf of the plaintiff company.

In view of the observations made above and law laid down by the Karnataka High Court in a case, neither any prima facie case was made out in favour of the applicants-plaintiffs nor balance of convenience lied in their favour, the court observed. In view of this, it was hereby dismissed. However, observations made above would have no bearings on the merits of the case.

The court adjourned the hearing in the case to December 4 this year.