Darjeeling Tea Steams in Dispute

Darjeeling Tea seems to be in the midst of a dispute, over its GI registration and related trade mark rights. The Tea Board of India, which holds rights to the GI (a device as shown here) and a Certification mark, moved against ITC Limited for naming a ‘section’ of its hotel ITC Sonar as “Darjeeling Lounge”. 

The Tea Board of India, has asserted exclusivity over "Darjeeling", and has moved an action for infringement and passing of both the Registered GI and certification mark, as well as dilution of the "Darjeeling" brand. 

Defending the Interlocutory Petition, ITC asserted that the rights under the Trade Marks Act and GI Act were meant to be restrain “use” only on goods and not services. They specifically asserted that the GI Act sought to protect indications with respect to goods only, on account of the quality, reputation or other characteristics attributable to their geographical origin. 

In giving due weight to the arguments, the Court examined the provisions of the GI Act as well as the Trade Marks Act. The Court, recognizing a cause of action in an unauthorized use of a good's certification mark by any service provider, felt that in view of the GI Act, infringement as under Section 22(1) of the GI Act was not available to Tea Board, since the use by ITC was not in connection with any designation or presentation of good. 

The Court, further ruled that against Tea Board on the passing off action, stating that by virtue of its registration as a GI or as a certification mark, they could not claim exclusive rights to “Darjeeling”. The Tea Board of India moved in appeal to this order. 

The Division Bench addressed the question of the scope of the Tea Board’s rights in view of its existing registrations. The Bench in view of Sections 28 and 29 (dealing in Rights conferred by registration and Infringement of registered Trademarks) and Sections 75 and 78 ( corresponding to rights in Certification trademarks). 

The Court particularly deliberated upon the infringement by use of a registered trademark by a person if he uses such registered trade mark, as his trade name or part of his trade name, or name of his business concern or part of the name, of his business concern dealing in goods or services in respect of which the trade mark is registered [sec 29 (5)] and observed that a corresponding provision is absent under Section 75. 

The Court opined that extrapolating the provisions in Section 29 to rights conferred under Section 75, is hence disallowed. With respect to the passing off action, the Court held that a prima facie case was not made out, since the Tea Board I of India neither traded in tea nor is in the service of rendering hospitality. The Court found that ITC in using the word DARJEELING did not falsely assert that it had the right to certify that the tea served in the lounge grows in Darjeeling. 

Further, the Court concluded that Tea Board's prima facie failure in proving violation of its registered certification trademark in terms of sec 75 of the TM Act, as it had not registered its name as holder of the mark DARJEELING in respect of hotel business but for the purpose of certification of tea as one grown in Darjeeling where benefit of Sections 28 and 29 of the TM Act is not available. 

The suit filed by Tea Board is pending before the High Court of Calcutta and the Intellectual Property Appellate Board (IPAB) is also set to hear this dispute, in respect of a challenge in opposition proceedings. Tea Board moved to IPAB challenging ITC’s application to register "Darjeeling Lounge" under class 42. This application had earlier been abandoned by the Registrar, since ITC had failed to file its counter-statement in time.