House no. 316, Ground Floor "A" Sector, Yelahanka New Town Bengaluru- 560 064

Shivani Complex, Kanta Stri Vikas Gruh Road Rajkot - 360 002. INDIA Phone : +91 281 242 731

203,Shriji Palace,Savsar Plot, Main Road, Morbi-363641 INDIA Phone:91 2822225263

312-313, 3rd Floor, Abhishek Complex, Akshar Chowk, Old Padra Road,
Vadodara 390 020 INDIA
Phone: (0265) 2322015

In a significant ruling that reaffirms the fundamentals of trademark law in India, the Delhi High Court dismissed VIP Industries Ltd.'s appeal in a trademark case against Carlton Shoes Ltd. The central issue was whether VIP Industries, a well-known Indian luggage brand, could maintain a passing off action against another entity for allegedly using a mark deceptively similar to "Carlton", a brand name VIP had previously used for its luggage products.

VIP Industries had acquired rights in the “Carlton” trademark through a foreign company and had used it for luggage goods.
The mark “Carlton” had some international recognition, but VIP could not prove any active commercial use or goodwill in India at the relevant time.
Carlton Shoes Ltd., the Respondent, was using the “Carlton” mark in a different product category (shoes) and argued that VIP had no domestic goodwill under the Carlton mark in India for luggage or any other goods.

Legal Question:

Can a company maintain a passing off action in India based solely on foreign use or reputation, without showing actual goodwill or presence in the Indian market?

The Delhi High Court ruled in favour of Carlton Shoes Ltd., holding that VIP Industries had failed to establish goodwill or reputation in India in relation to the Carlton mark at the relevant time.

The Court clarified that under Indian law, a passing off action is grounded in the principle of protecting existing goodwill in the local market.

Simply having a foreign reputation or a registered mark is not sufficient — there must be evidence of real market presence, customer base, or promotional activity in India.

The Court emphasized that passing off protects the business reputation built within the jurisdiction and does not extend to "unused" trademarks or reputation acquired abroad but not commercialized in India.

----------------------------------------------------------------------------------------TOP

Prepared by : Drashti S. Varmora (Advocate)