MANU/DE/4280/2022

Equivalent/Neutral Citation: 2022:DHC :4612

IN THE HIGH COURT OF DELHI

CS (COMM) 539/2021 and I.A. 14039/2021
Decided On: 31.10.2022
Geetanjali Studio Private Limited and Ors. Vs. Rahul Mamtani
Hon'ble Judges/Coram:
Prathiba M. Singh, J.
Counsels:
For Appellant/Petitioner/Plaintiff: Manish Biala, Advocate
Case Category:
MERCANTILE LAWS, COMMERCIAL TRANSACTIONS INCLUDING BANKING - TRADE
MARKS/COPY RIGHTS/PATENTS/DESIGN ACT
DECISION
Prathiba M. Singh, J.
1. This hearing has been done through hybrid mode.
2. The Plaintiff-Geetanjali Studio Private Ltd. and Mr. Sumit Israni have filed the present
suit seeking protection of their mark 'GEETANJALI' which is used for salon, beauty
parlour, etc. The Plaintiff claims to be one of the well-known salons based out of Delhi
specializing in hair dressing, styling and make-up services, catering to national and
international customers and eminent personalities of the fashion industry. The marks of
the Plaintiff are registered in various Classes in 44 and 47. The details of which are as
under:

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3. The Plaintiff claims to have more than 100 salons/franchises across the country with
a turnover of more than 44 crores for the financial year 2019-20. The Plaintiff runs its
chain of salons under two names, 'GEETANJALI STUDIO' and 'GEETANJALI SALON',
catering to two different segments-the sales of which have been set out in the Plaint.
The plaintiff also shows promotional expense of approximately Rs. 2 crores, spent on
advertising and promotion of the said marks. The Plaintiffs have won several awards
and accolades which are set out in paragraph 10 of the plaint. The website of the
Plaintiff is https://geetanjalisalon.com and they also have an Instagram profile to
promote their brand.
4. The Defendant is Mr. Rahul Mamtani who had obtained a license from the Plaintiff for
running 'GEETANJALI STUDIO' in Vikas Puri. As per the plaint, the Defendant
approached the Plaintiff in 2017 and entered into a franchise agreement dated 27th
November, 2017. The Defendant was permitted to use the mark 'GEETANJALI" as per
the said agreement on a non-exclusive basis. The initial franchise fee of Rs. 5,00,000/-
was deposited. The Defendant was to also pay a monthly franchise fee of Rs. 50,000/-.
The case of the Plaintiff was that the franchise fee for some months was outstanding
and, accordingly a demand letter was issued to the Defendant on 23rd February, 2019
to pay the outstanding amount of Rs. 2,36,000/-. Again, further amount became due
upon which a notice dated 24th December, 2019 was issued seeking payment of a sum
of Rs. 3,24,000/-. This amount continued to increase and as of 31st August, 2022 the
due amount is stated to be Rs. 4,49,000/-. Despite repeated follow ups the Defendant
did not make the payment. The Plaintiff then terminated the franchise agreement vide
notice dated 11th September, 2022 which was, further reiterated on several dates. Since
the Defendant did not pay the franchise amount and did not also stop its use of the
mark 'GEETANJALI', 'GEETANJALI STUDIO' and 'GEETANJALI SALON', the Plaintiff filed
the present suit. Vide order dated 28th October, 2021, this Court had considered the
matter and had granted an interim injunction in the following terms:

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5. The Defendant has also been served with the suit summons and notices, as recorded
in order dated 6th July, 2022. Mr. Manish Biala, ld. Counsel submits that, despite, the
service, the Defendant is not appearing. However, it is submitted by ld. Counsel for the
Plaintiff that the Defendant has now stopped use of the mark 'GEETANJALI'. The
Defendant is accordingly proceeded ex parte.
6 . The Franchise Agreement stands admitted in this case, as the Defendant has made
payments of franchise fee to the Plaintiff. Some clauses of the franchise agreement are
set out below:
"4. ACCEPTANCE BY FRANCHISEE
Franchisee accepts this Agreement and the license granted to Franchisee, and
undertakes the obligation to develop and operate the Salon in accordance with
the System using the Marks in strict compliance with the terms and conditions
specified in this Agreement. Franchisee may not franchise, subfranchise, license
or sublicense the rights granted to Franchisee in this Agreement.
5. NON-EXCLUSIVE LICENSE
The license granted to Franchisee is non-exclusive. The Franchisor has the
absolute right to establish company-owned or franchised salons at any
locations they choose outside the Authorized Location under this Agreement.
Franchisor may operate or franchise a business under a different trademark or
name that sells goods and services similar to those offered by Franchisee and
may engage in any other operation, haircare or otherwise, at any location and
to any customer.
1 3 . DURATION, TERMINATION AND RENEWAL AND TERMINATION
CONSEQUENCES
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 13.1 This Agreement becomes effective on the date of signing and is valid for a
period of 09 years.
13.2 Termination of the license of franchise for each Salon shall be separate.
13.3 In case Franchisor shall have the right to give a written default cure
notice of 2 (Two) months to the franchisee and if the franchisee remedies the
default within the default cure notice period, then the default cure notice shall
stand waived. In the event of franchisee's failure to remedy default within the
default cure notice period, the Franchisor shall have the right to terminate this
Agreement by giving 1 (one) month written notice to the franchisee. The
License of Franchise may be terminated by the franchisor by giving one month's
notice to Franchisee in writing in any of the following events:
a) If the Franchisor stops selling of services and products for any
reason;
b) If the Franchisor commits breach of any term of this Agreement;
c) If the Franchisee fails to pay any sum due within next working day
of the due date, unless extended by the Franchisor in writing;
d) If the Franchisor is ordered to be wound up by Court or goes into
voluntary liquidation.
e) If the Franchisee activities are damaging to the Franchisor's
Reputation or business directly or indirectly.
13.4 Upon termination of this Agreement for whatever reason, the Franchisee
will not be entitled to make use of any trademarks of the Franchisor and all
Intellectual Property rights and licenses granted to the franchisee in this
Agreement shall immediately terminate upon termination. All claims or actions
that one party has against the other shall remain intact despite termination.
13.5 Franchisee can also terminate the agreement with 30 (thirty) days prior
written notice to Franchisor."
17. USE OF INTELLECTUAL PROPERTY
17.1 The Franchisor grants to the Franchisee during the term of this Agreement
a license and permission to use the brand name only in relation to the services
provided at the Salon.
1 7 .2 The use of the brand name by the Franchisee shall only be for the
purposes of this Agreement, and will not create any right, title or interest in the
brand name in favour of the Franchisee.
17.3 AIl Intellectual Property of the Franchisor is to be used only in the manner
as specified in this Agreement."
7. The above clauses are clear to the effect that the Defendant had to immediately stop
use of the mark and not use any of the Intellectual Property of the Plaintiff. In view of
the above clause, since the termination of the agreement has taken place, the Defendant
would be liable to be permanently injuncted from using the Plaintiffs' marks.

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8. Considering that the Defendant was an ex-franchisee of the Plaintiffs, and the terms
of the franchise agreement are clear to the effect, that the Defendant acknowledges the
Plaintiff's right in the mark 'GEETANJALI', no further oral evidence would be required in
this matter, as held in Disney Enterprises Inc. & Anr. v. Balraj Muttneja &Ors. [CS (OS)
3466/2012 decided on 20th February, 2014]. The relevant observations from the
judgment in Disney Enterprises Inc. (supra), are as under:
"3. Though the defendants entered appearance through their counsel on
01.02.2013 but remained unrepresented thereafter and failed to file a written
statement as well. The defendants were thus directed to be proceeded ex parte
vide order dated 04.10.2013and the plaintiffs permitted to file affidavits by way
of ex parte evidence. 4. The plaintiffs, despite having been granted sufficient
time and several opportunities, have failed to get their affidavits for leading ex-
parte evidence on record. However, it is not deemed expedient to further await
the same and allow this matter to languish, for the reason that I have in Indian
Performing Rights Society Ltd. Vs. Gauhati Town Club MANU/DE/0582/2013
held that where the defendant is ex parte and the material before the Court is
sufficient to allow the claim of the plaintiff, the time of the Court should not be
wasted in directing ex parte evidence to be recorded and which mostly is
nothing but a repetition of the contents of the plaint."
9. The Defendant shall, accordingly, stand restrained in terms of paragraphs 48 (i) and
(ii) of the prayer clause in the Plaint.
1 0 . Insofar as the rendition of accounts and profits and delivery up are concerned,
since there is no defence put up by the Defendant, considering the amounts which are
stated to be due and the costs which the Plaintiffs had to incur in filing the present suit,
the suit is decreed for a sum of Rs. 7,50,000/-in favour of the Plaintiff against the
Defendant, towards damages and costs. No other reliefs are pressed.
11. Decree sheet be drawn up in the above terms.
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